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TRANSCRIPT
CONTRACT DATA MANAGEMENT &
FINANCIAL DATA REPORTSTO
MANAGE YOUR BUSINESS ASSETS&
EVALUATE PORTFOLIO ASSETS
Work Shop will be divided into two sessions.
Contract Data Management &
Financial Data Reports
Overview– 1st Session will cover Data Contract Management
• History• Development• Typical ATM Industry Agreements• Contract Data Points• Contract Management Systems • CMS Core Features/Reports/Examples• What To Look For In a CMS System• Closing
Continue Overview– The 2nd Session will cover developing & tracking– Two ATM Portfolio Financial Reports
• Type of Report• Relevance• Benefit• Establishing• Managing Your Portfolio
History ‐ Data Management• My first work with contracts was during my 2nd/3rd Year law
school, law clerk for General Counsel NASA Research Center.• Contracts were contained in PAPER FORMAT.• NO computers, NO software, everything was typed or written
or forms to be filled in…ALL IN PAPER FORMAT.• Paper was placed in manilla folders, FILED in file cabinets.• Cabinets were labled & stored in SEPARATE building.• Research was laborious & extremely time consuming.
History ‐ Continued ‐ 2• Following law school, I became General Counsel for an insurance company.
• For every insured, there was at minimum an insurance application, issued policy/contract, & more than likely a rider or two, with ALL such documents set forth in PAPER FORMAT.
• NO computers, NO software, as everything was hand written or typed in on application forms to be filled in, with form policies then issued with terms specific to the insured, for that type of insurance.
History ‐ Continued ‐ 3• ALL insurance docs were in PAPER FORMAT, FILED in manilla
folders, FILED in file cabinets.• Cabinets were labled & stored offsite.• Research was laborious & extremely time consuming.• Typically, department managers (legal departments) created,
updated, maintained paper lists, spreadsheets of their respective organization/departments key, critical agreements, with a separate list of key contract terms prepared & kept for such agreements on their lists.
• NO contract data software, everything was hand written or typed, all in PAPER FORMAT.
History ‐ Continued ‐ 4• Eventually large frame computers came into existence, but their
primary use was not for storing contract data or data management, but more for financial applications & word processing.
• During this time frame, most all US industries, companies, (contract) managers, legal departments primarily relied upon PAPER documents being physically stored in metal (some fireproof for important, original documents) &/or wood cabinets.
• Again, managers/legal departments continued to create, update, maintain paper lists/spreadsheets of their respective organization’s key/critical agreements, with a separate list of key contract terms prepared & kept for such agreements on their list, as there was still NO contract data software
History ‐ Continued ‐ 5• Unfortunately, contract data management performed in this
manner, also led to a litany of mistakes, such as contracts being misfiled, misplaced, incorrectly being re‐filed, or lost.
• Typically most company managers had their “own” style of filing contracts & when mangement personnel left a company, usually their mental based knowledge went out the door with them if their process/procedures were not written down.
• All of these things led to inefficiencies, excess work, missed dates for renewal, unintended termination of agreements, missed opportunities to re‐negotiate key terms, lapse in contract rights or options, audit/report nightmares, etc.
History ‐ Continued ‐ 6• Thus, these types of issues/problems resulted in unintended
costs & lost opportunities to companies. • Over time, (i) the burden of contract management, (ii) the
risks associated with paper recordation & (iii) contracts being filed in cabinets, (iv) along with the costs incurred due to ineffective & inefficient management, (v) as well as risks incurred through such contract data management, (vi) along with the ever expanding development of computer technology, led to the development of contract management software & companies transitioning to electronic‐digitized contract management systems.
History ‐ Continued ‐ 7• Before diving into current contract management software systems & their benefits, I want to first discuss a typical ATM ISO’s spectrum of Contracts & what Contract Data Points I recommend you should track & manage.
ATM Industry
• The ATM Industry has been built on extensive contractual realtionships developed over time between a multitude of parties.
• For purposes of this workshop, a ‘small‘, typical ISO Company (ABC, Inc.) could have at minimium the following contractual relationships:–1. Office Lease Agreement–2. Office Equipment Lease Agreement
ATM Industry Continued ‐ 2
–3. ATM Manufacturer Agreement –4. Sponsoring Bank Agreement–5. TPSP Processor Agreement–6. Sub‐ISO (IA/C) Agreement–7. Merchant Owned Processing Agreement–8. Leasing Company Agreement for
merchant to lease‐buy ATM –9. Placement (ISO Owned) Processing
Agreement
ATM Industry Continued ‐ 3
–10. Offsite Owner Processing Agreement–11. Special Events Agreement–12. ATM Sale Agreement–13. Cash Loader/Vault Agreement–14. Third Party Service Provider (TPSP)
Agreement (Service) (Maintenance)–15. Branding Agreement
ATM Industry Continued ‐ 4
–16. ATM Portfoilo Management Agreement–17. Portfolio Acquisition Agreement –18. Other Agreements
Contract Data Points• What is a Data Point for Contract Management?• I just listed 17 Agreements on the two previous slides (not
including ‘other’ as #18).• 1. With respect to the 17 types of Agreements, the First
Data Point is identifying the “Contract Type”, the type of Aagreement you are entering into, i.e. which of the 17 types of Agreements?
• With regard to each of the prior 17 types of Agreements, the next Two through Eighteen Data Points are all applicable. They are as follows:
Data Points Continued ‐ 2• 2. Name of Contract Party• 3. Contract Party: Individual; General Partnership,
Limited Partnership; Entity: Corporation, LLC, LLM• 4. If Entity, State Domiciled• 5. Address to Send Notice
• i. By Mail• ii. By Person• iii. By Electronic Means
• 6. Primary contact telephone # re Call • 7. Primary contact telephone # re Fax• 8. Primary email address
Data Points Continued ‐ 3• 9 Physical Site (address/location) of where ATM is
Installed • 10. Effective date of Contract (vs. Date Contract Signed)
that is When Contract Term Begins• 11. Seasonal “Y–N”• 12. Length of “Initial Term” of Contract• 13. Renewal Term “Y–N”• 14. If “Y”
• i. Length of Renewal Term• ii. How many Renewal terms
– a. #– b. Evergreen– b. Sunset
Data Points Continued ‐ 4• 15. Auto Renewal Term “Y–N”• 16. If “Y”
• i. Auto Renewal unless ___ days’ prior‐notice provided• ii. Auto Renewal Term, who’s option
• 17. Auto Termination Term “Y–N”• 18. If “Y”
• i. Auto Termination unless ___ days’ prior‐notice provided• ii Auto Termination Term, who’s option
Data Points Continued ‐ 5• Most of the next Nineteen through Fifty‐One Data Points are applicable to the basic three ISO ATM “Processing Agreement Contract Types” – Merchant, Owner of ATM– Placement, ATM Owned by ISO– Offsite Owner, Owner of ATM, with:
• Tri‐Party Agreement between ISO, Offsite Owner & Merchant• or Two‐Party Agreement between ISO & Offiste Owner with a separate Two‐Party Agreement between Offiste Owner & Merchant
Data Points Continued ‐ 6• 19. Make of ATM• 20. Model of ATM• 21. ATM EMV Compliant “Y–N”
• i. Software Certified• ii. EMV Turned On
• 22. ATM NFC Configured/Operational• 23. ATM Mobile Configured/Operational• 24. ATM Contactless Configured/Operational• 25. ATM Cash Recyclable Configured/Operational
Data Points Continued ‐ 7• 26. Other Equipment• 27. Terminal Identification Number (TID)• 28. Cash Loader “Y–N”
• i. If “Y”, who is Cash Loader• 29. Sub‐ISO “Y–N”
• i. If “Y”, who is Sub‐ISO• 30. Surcharge Fee “Y–N”
• i. If “Y”, Surcharge Fee Amount $• 31. ISO Processing Fee “Y–N”
• i. If “Y”, Processing Fee Amount $
Data Points Continued ‐ 8• 32. Fee Distribution
• i. % Surcharge Fee to [__] • ii. % Surcharge Fee to [__] • iii. % Interchange Fee to [__] • iv. % Interchange Fee to [__] • v. % Processing Fee to [__] • vi. % Processing Fee to [__]
• 33. Fee Payment Schedule• 34. TPSP Processor Fee Amount Per
Transaction $
Data Points Continued ‐ 9• 35. Termination Rights• i. Breach With Cause• a. Notice Requirements “Y–N”• b. If “Y”, time• c. Cure Rights “Y–N”• ii. Breach Without Cause
a. Notice Requirements “Y–N”b. If “Y”, time
• c. Cure Rights “Y–N”• iii. Definition of Breach “Y–N”• 36. Liquidated Damage Clause “Y–N”• i. If “Y”, amount
Data Points Continued ‐ 10• 37. Assignability Clause • i. Unilateral – Bilateral• ii. Sole option “Y–N”• iii. Not Unreasonably Withheld “Y–N”• iv. Over 51% sold re assignment “Y–N”• 38. Restriction on Relocating Biz• 39. Restriction on Relocating ATM• 40. Restriction on Sell of ATM• 41. Right of Offset
Data Points Continued ‐ 11• 42. Controlling Law• 43. Venue• 44. Attorney Fees• 45. Hold Harmless/Indemnification• i. Unilateral or bilateral• 46. Compliance Clause• i. Statutory• a. Unilateral or bilateral• ii. Network• a. Unilateral or bilateral• 47. Insurance
• i. Written• ii. Both Parties
Data Points Continued ‐ 12• 48. Amendment• i. Written• ii. Both Parties• 49. Advertising/Branding of ATM• 50. Executed by All Parties “Y–N”• 51. Exhibits “Y–N” • i. ID & Description• ii. ID & Description
Contract Management Systems• As stated earlier, companies transitioned to electronic‐digitized contract management systems to:– save time– reduce costs– reduce risks– generate & expedite enumerable types of reports for management to facilitate more efficient mangement of company assets & thereby increase the value of their long term contracts
Contract Management Systems ‐ 2• Over time, more digital contract management systems
were developed & are available in the market place.• The primary core functionalities of any CMS to
consider are:– An extensive online (cloud) SECURE DEPOSITORY to hold complete contracts in a VIRTUAL file cabinet that can be accesible REMOTELY, with REDUNDANT sites to prevent loss of contracts.
– Ability to IMPORT DATA POINTS initially & periodically at anytime related to a contract, to allow immediate DISCOVERY, RECOVERY of data for reports and/or alerts.
Contract Management Systems ‐ 3– Ability to facilitate the TRACKING & LOCATION of DATA POINTS for specific contracts or groups of contracts that meet various criteria, variables.
– The AGGREGATION of contracts and/or their identified DATA POINTS for reporting purposes.
– EASE of INPUTTING (importing) data, use of SYSTEM.
•
CMS REPORTS• What kind of reports can you generate?• What does a report look like?• The following three slides gives you an idea what types of reports you can genertate after you have imported whatever Data Points you have chosen to track for your contracts.
Processing & Surcharge Fees• l
ATM Status Quick Audit
Contract Renewal & Termination
Summary of What To Look For In a CMS
• Contract Storage:–What Manner–What Capacity
• Ease of Data Entry– Can it be Customized
• Alerts– How & Ease to Set re Key Terms– To Whom
Summary of What To Look For ‐ 2• Data Points
– Fields Searchable
• Search Criteria – Refined– Filtered– Saved– Entire Contract
Summary of What To Look For ‐ 3• Search Info Exported to a Report• Type of Reports• Cost• Training
Closing• You are good & knowledgeable of how to sell & service Your ATM Portfolio Accounts!!! BUT
• Do You realize the substantial business, financial & legal repercussions & risks in not effectively managing Your Contracts?
INEFFECTIVE MANAGEMENT• Inefficient Contract Management results in…
• Missing Key Contract Dates, • Waiving Contract Rights• Loss of Contract Documents• Increase costs to research terms & recover documents
EFFECTIVE MANAGMENT• The MORE KNOWELEDGEABLE YOU ARE ABOUT ALL OF YOUR CONTRACT TERMS THROUGH CONTRACT DATA
MANAGEMENT, THE MORE VALUABLE YOUR BUSINESS CAN
BECOME!!!
QUESTIONS
THANK YOU
CONTRACT DATA MANAGEMENT &
FINANCIAL DATA REPORTSJack Milford Ford, JMFord Law Office