Program Agreement for Canadian Providers (excluding Quebec)



Last Updated:  August 2020

This Agreement is between Scratch Financial, Inc. (“Scratchpay”), a Delaware corporation, with corporate offices at: 225 S. Lake Avenue, Suite 250, Pasadena, CA 91101 USA, and the Provider (“Provider”), a Canadian Provider with offices located in the Canadian provinces and territories.
Scratchpay wishes to establish a financing and loan program for clients of Provider whereby Provider’s clients may obtain a loan for the purpose of financing the purchase of goods and/or services provided by the Provider, and Provider wishes to make financing available to its clients, as per the terms and conditions set forth in this Agreement.

1. Definitions:

When used in this Agreement:

  • “Aggregate Program Amount” means the aggregate of all Procedure Amounts that have not been repaid to Scratchpay by all of Provider’s Clients on the date that this Agreement is terminated;
  • “Agreement” means this Agreement and any and all schedules hereto;
  • “Client” means any individual that is a client of Provider;
  • “Client Agreement” means the agreement or transaction between the Client and the Provider pursuant to which the Provider provides goods and/or services to the Client;
  • “Client Information” means information, including personal information, pertaining to a Client;
  • “Customer Agreement” means the financing agreement between a Client and Scratchpay;
  • “Procedure Amount” means the actual amount borrowed by a Client from Scratchpay plus all accrued and unpaid interest thereon and any applicable fees;
  • “Program” means the financing program contemplated herein, as the same may be amended or modified by Scratchpay from time to time;
  • “Provider Fee” has the meaning given in Section 2;
  • “Scratchpay Payment” means, in respect of a Customer Agreement, the principal amount of the loan under such Customer Agreement, less the applicable Provider Fee;
  • “Settlement Account” means the bank account designated from time to time by Provider for receipt of any funds owing to it by Scratchpay;
  • “Trademarks” means any design, image, visual representation, logo, service mark, trade dress, trade name, or trademark used or acquired by Scratchpay in connection with the Program during the term of this Agreement.

2. Scratchpay Provider Fees:

As consideration for the services provided by Scratchpay under the Program, Provider will pay Scratchpay a one-time administration fee per approved transaction, regardless of the type (including Pay Over Time, Pay Later and Take 5) of Scratchpay Payment (“Provider Fee”), in accordance with Scratchpay’s pricing table set forth below (as the same may be amended from time to time, by Scratchpay upon thirty (30) days prior written notice to the Provider). The Provider Fee shall be retained by Scratchpay and deducted from the loan proceeds remitted by Scratchpay to Provider in respect of the loan.

Segment Provider Fee (% of total Scratchpay Payment Amount)
Veterinary 5%
Vision/Dental/Medical 7%
Addiction Treatment 15%

3. Scratchpay Obligations:

  • Scratchpay shall design, develop and administer the Program for the Providers in accordance with all applicable laws and the terms of this Agreement. Scratchpay shall provide the Provider with a training guide and all amendments thereto (such training guide as amended by Scratchpay from time to time the “Training Guide”) that sets out procedures pertaining to the Program.
  • Scratchpay reserves the right to evaluate and make periodic adjustments to the Program and its terms and features and shall give Provider reasonable prior notice of any material adjustments; however, any changes to the Program required to comply with applicable laws shall not require prior notice to the Provider by Scratchpay, provided Scratchpay shall as soon as practicable after such adjustment provide notice of same to the Provider.
  • Scratchpay will send Provider timely payment authorization notifications to the email address(es) specified and updated by the Provider.
  • Scratchpay will transfer the amount of Scratchpay Payments due to the Provider to the Settlement Account.
  • Scratchpay will contact the Provider in the event of any dispute requiring support from Provider to resolve concerning payments under the Program.

4. Provider Obligations:

Provider's obligations include, without limitation:

  • Provider shall accept and process online applications from Clients in accordance with this Agreement, applicable law and the Training Guide. Provider agrees to comply fully with Scratchpay’s instructions regarding the Program; Provider will acknowledge that no Scratchpay Payment is authorized until Provider receives a payment authorizing email notification from Scratchpay;
  • Provider shall ensure that each of its Representatives (defined below) is trained regarding the Training Guide and applicable laws and will call Scratchpay’s Provider support line prior to completing a transaction involving suspicious or unusual circumstances;
  • Provider will not charge any Client for participation in the Program nor shall the Provider impose a surcharge in respect of transactions made, goods sold or services provided in connection with the Program, and will not, by any means, require the Client to pay all or any part of the Provider Fee or any other charge assessed against the Provider by Scratchpay;
  • Provider will process only bona fide charges and shall credit and deliver all goods and/or perform all services covered by the applicable Client Agreement in accordance with the terms in that Client Agreement and applicable laws, including any professional guidelines, licensing or other requirements applicable to veterinarians;
  • Provider will maintain fair and legally compliant refund, return and exchange policies, and ensure that any material restriction or limitation to such return and exchange policies is clearly and conspicuously disclosed in writing to Clients and Scratchpay prior to Scratchpay entering into the Customer Agreement. Policies are to be easily understood by the average client (it being agreed that any return policy that precludes reimbursement under any circumstances for services not rendered is deemed unreasonable);
  • Provider will display point-of-sale and website signage relating to the Program, which must be distributed or approved by Scratchpay;
  • Provider shall (i) actively promote Scratchpay’s services and encourage its customers to apply for Scratchpay financing at the point-of-sale and on the Provider’s website; and (ii) not make any comment, statement or take any act or encourage any third party to make any comment or statement or take any act that is disparaging to Scratchpay or the Program or which could reasonably be expected to bring Scratchpay’s reputation into disrepute;
  • Provider shall provide reasonable assistance to Scratchpay in the event of a dispute between Scratchpay and a Client requiring support from Provider to resolve;
  • The Provider is strictly responsible for complying with all laws applicable to it in connection with the Program, including any professional guidelines, licensing or other requirements applicable to veterinarians, and hereby covenants in favor of Scratchpay that it will and will cause its employees, agents, representatives and all other persons who assist it with the Program (“Representatives”) to so comply and the Provider shall fully indemnify and hold Scratchpay harmless for any failure by the Provider or its Representatives to so comply.

5. Joint Obligations:

Scratchpay and Provider shall each maintain the confidentiality of all Client Information, except as set out in this Agreement or in accordance with applicable law. Scratchpay and Provider shall each maintain appropriate privacy policies and shall not collect, use, share or disclose personal information, except in accordance with applicable law.

6. Settlement Process:

  • Upon receiving confirmation through the Provider’s online Scratchpay Dashboard (from the Provider) of the finalized Scratchpay Payment amount used by the Provider’s client, Scratchpay will send the Scratchpay Payment of Settlement Amount to the Provider. Provided that the Provider submits documentation, including the Customer Agreement signed online by the Client and authorization for Personal Pre-Authorized Payment Plan, Scratchpay will credit the amount owing to the Provider to the Settlement Account, which amount is a Scratchpay Payment including the total of (i) any Provider Fees and/or (ii) any amounts being refunded by Provider.
  • Provider acknowledges that Scratchpay may debit the bank account specified by the Provider with authorization, for the amount of any Provider Fees according to this Program and/or subtract the amount of any Provider fees from the Scratchpay Payment for settlement payment.
  • Provider will not (i) impose any surcharge on purchases made with Scratchpay, (ii) require the client to pay any part of any charge assessed by Scratchpay to the Provider, whether through any increase in price or otherwise, or (iii) set a dollar amount above or below which Provider refuses to honor otherwise valid Scratchpay Payments. If proceeds of any confirmed Scratchpay payment have been sent to Provider prior to Scratchpay’s discovery of any defects herein; Scratchpay may chargeback the amount sent to the Provider.
  • All amounts owing by Provider to Scratchpay under this Agreement that are not received by Scratchpay within 30 days of the date the amount is due shall be subject to interest at a rate per annum equal to the Prime Rate as posted by the Bank of Montreal plus three (3) percent (this may reflect the fee paid in the same ACH transaction process for funds transferred and fee returned).
  • The provisions of this section 6 (and any provisions necessary to give effect to this section 6) shall survive the termination of this Agreement.

7. Refunds

  • Provider acknowledges that Provider may request to refund all or part of a previously confirmed Scratchpay Payment. If the request is made within 30 days of the previously confirmed date, the Provider’s bank account may be debited for the Settlement Amount associated with the refund request. If the request is made within 30 days of the previously confirmed date and the Provider’s bank account is not charged, the Settlement Amount associated with the refund request may be applied towards any amount Scratchpay owes Provider, subtracting the amount owed to Scratchpay from future credits to Provider until the negative balance is covered.
  • Provider acknowledges that if the refund request is made more than 30 days after the previously confirmed date, the Provider’s bank account may be charged (i) the Settlement Amount and (ii) the Transaction Fee associated with the refund request. If the request is made more than 30 days after the previously confirmed date and the Provider’s bank account is not charged, the Settlement Amount and Transaction Fee associated with the refund request may be applied towards any amount Scratchpay owes Provider.
  • In the event of a loan cancellation, Scratchpay may charge the Provider a Return Fee which is 5% and the fees shown below. In the event of a loan cancellation, Scratchpay may charge the Provider a Return Fee (i) for refunds up to 30 days of loan agreement date: the original Procedure Amount Loan cancellations are not permitted after 30 days except at the sole discretion of Scratchpay. Provider acknowledges, that if the refund request is made more than 30 days after the previously confirmed date, the Provider’s bank account may be charged (i) the Settlement Amount and (ii) the Transaction Fee associated with the refund request. If the request is made more than 30 days after the previously confirmed date and the Provider’s bank account is not charged, the Settlement Amount and Transaction Fee associated with the refund request may be applied towards any amount Scratchpay owes Provider.
  • The provisions of this section 7 (and any provisions necessary to give effect to this section 7) shall survive the termination of this Agreement.

8. Trademarks

Scratchpay hereby grants Provider a limited, non-exclusive and royalty free license to use the Trademarks solely in conjunction with and in support of the Program. Any other person for any other reason or for any other purpose may not use the Trademarks except as specifically approved for the Program. This license shall remain in effect for the duration of this Agreement, and shall apply to all Trademarks notwithstanding the transfer of such Trademarks by operation of law or otherwise to any permitted successor, corporation, organization or individual.

9. Dispute Resolution and Chargeback Rights

  • Any issue concerning this Agreement is to be initially addressed by each party’s representatives (excluding their legal counsel). If the parties are not successful in resolving an issue or dispute pursuant to such informal process within 90 days, or if the issue is material and either party believes the parties will not be successful in resolving such issue or dispute pursuant to such process, then either party may issue a formal written notice that a dispute has arisen by way of arbitration.
  • Scratchpay will bear all credit losses for Clients due to non-payment. Notwithstanding the forgoing Scratchpay may charge back to Provider (and deduct the applicable amount from the Settlement Account) in respect of any Customer Agreement if one of more of the following occurs due to non-payment: (i) Client disputes the charge of the Provider, provided Scratchpay has given Provider a ten (10) calendar day opportunity to respond and either (a) the Provider fails to respond within such ten (10) calendar day period; or (b) the Provider responds during such ten (10) calendar day period but Scratchpay determines that the Client’s dispute is valid; (ii) the Client refuses to pay, based on an assertion of a dispute about the quality of the merchandise purchased or services provided, by or on behalf of Provider, including any alleged breach of warranty provided by or through Provider.
  • Before charging back, Scratchpay will first request a written response from Provider regarding the Client’s assertions. Scratchpay will charge back Provider for the transaction if any of the following occur: (i) no written response is received within ten (10) calendar days from the date of Scratchpay’s request; (ii) a written response is received but Scratchpay determines the Client’s assertion is valid or could reasonably be expected to be valid; (iii) the charge of the Provider is disputed, and Provider cannot supply a copy of the underlying sales receipt within ten (10) calendar days of Scratchpay’s request; (iv) Scratchpay determines that any charge does not represent a bona fide sale or service (including without limitation, charges arising from fraudulent activities of Provider’s employees) by Provider; (v) charge(s) by Provider are incurred on a Client’s account opened upon submission of a defective application; (vi) the Client asserts that the goods or services purchased by the Client from the Provider have not been fully delivered, performed, provided or shipped; (vii) the Client alleges that the Provider provided false or misleading information (e.g. incorrect information about credit promotions); (viii) any disputed or fraudulent charge or credit relating to a transaction where the Client was not physically present at Provider’s location (e.g. telephone or internet); or (ix) the transaction is rescinded as permitted by and in accordance with applicable law.

10. Provider Information

Provider represents and warrants to Scratchpay that the information furnished by Provider to Scratchpay in its application for participation in the Program is complete and accurate and fairly presents the financial condition and business of Provider. Scratchpay in a separate file will maintain such information from the Provider, which will only be used: (i) in furtherance of the credit process, including to obtain and exchange credit information from and with credit reporting agencies, credit reference and other sources with whom Provider has or may expect to have financial dealings, including Scratchpay’s affiliates, to underwrite and approve this Agreement and each Customer Agreement; and (ii) to enter into, maintain and carry out this Agreement and each Customer Agreement. Additionally, Provider will approve and provide Scratchpay upon request a copy of Provider’s prepared financial statements and such other information as Scratchpay may reasonably request. Provider will also provide Scratchpay with information of any change of control involving Provider, the sale of the business of the Provider or any change in Provider’s name, business structure or form or principal, registered or head office, or province of incorporation, before such change occurs. Provider approves and authorizes Scratchpay at any time to order or obtain a consumer or commercial report on Provider and personal credit reports with approval on the principals of Provider (owners, partners, members, etc.). Subsequent reports may be ordered in connection with updating, reviewing, or continuing this agreement.

11. Confidentiality

Provider will treat as confidential all data, records, accounts, and other information regarding Scratchpay and its affiliates that become known to Provider or is generated by Provider through its activities hereunder, including information regarding Scratchpay and its affiliates’ operations, policies, procedures, methodologies, materials, employees, clients, information technology systems, and financial information and plans (“Scratchpay Confidential Information”). Provider’s confidential obligations include establishing and maintaining appropriate safeguards, procedures, and systems to avoid the unauthorized destruction, loss, alteration, access to, or disclosure of any Scratchpay Confidential Information, in accordance with the standards of the applicable industry and as otherwise required by applicable law. During and after the term of this Agreement, Provider will not use or disclose the Scratchpay Confidential Information, except for the purposes of the Program in accordance with this Agreement, or as may be required by law, regulation or court order. The obligations of confidentiality under this Section do not apply to any information to the extent it: (i) was known to the Provider prior to its receipt of or access to that information from Scratchpay, (ii) was or becomes a matter of public information or publicly available through no act or failure to act on the part of the Provider, (iii) is acquired from a third party entitled to disclose the information without obligation of confidentiality, or (iv) is developed independently and without use of the Scratchpay Confidential Information.

12. ACH Authorization

  • This Agreement governs ACH transactions initiated by Scratchpay to credit or debit the Provider. Both parties agree to be bound by NACHA Operating Rules as they pertain to all ACH transactions initiated by Scratchpay that credit or debit the Settlement Account and acknowledge that the origination of ACH transactions to the Settlement Account must comply with provisions of U.S. law. For Debits run through Canadian financial institutions using systems overseen by Payments Canada, a pre-authorization debit agreement will be generated with separate authorization for each sporadic debit.
  • This Agreement provides authorization for individual or recurring CCD transactions to be initiated by Scratchpay from Canadian Accounts when individually authorized using methods including, but not limited to, Dashboard, phone, fax, email, and written. Provider authorizes Scratchpay to initiate credit entries and to initiate, if necessary, debit entries and adjustments for any credit entries in error to the Settlement Account. Provider also authorizes Scratchpay to initiate debit entries and to initiate, if necessary, credit entries and adjustments for any debit entries in error to the Settlement Account. Provider agrees not to dispute any debits with its bank provided the transaction(s) correspond to the terms indicated in this Agreement.
  • Provider understands that this ACH authorization will remain in effect until it is canceled in writing, and agrees to notify Scratchpay in writing at least 15 days in advance of any changes in its Settlement Account information or termination of this authorization.

13. Provider Representations, Warranties and Covenants:

Provider represents, warrants and covenants as follows:

  • If it is determined a Client is owed a refund for goods and/or services paid for under the Program, Provider shall remit the refund to Scratchpay;
  • On behalf of Scratchpay, Provider shall store original documentation of the sale of goods and/or services related to each Scratchpay Payment for at least one year from the date of the respective Scratchpay Payment;
  • Any and all information previously furnished by Provider to Scratchpay, or any information subsequently furnished by Provider, is or shall be true and correct in all material respects when furnished;
  • Provider will not accept a Scratchpay Payment for the purpose of (i) disbursing cash to the Client, or (ii) refinancing an existing debt;
  • Provider will forward to Scratchpay promptly after receipt, at any time during or following Provider’s participation in the Program, a copy of any legal proceeding, or a communication relating to a Customer Agreement or Client Agreement from a Client or from a governmental or regulatory authority;
  • Provider shall not approve a Scratchpay Payment for services not yet rendered, unless those services are (i) intended to be (and are) completed within thirty (30) days of the Scratchpay Payment, or (ii) for out-of-pocket costs incurred, within thirty (30) days of the Scratchpay Payment.

14. Term/Termination:

  • This Agreement shall continue indefinitely unless terminated by either party in accordance with its terms.
  • Provider may terminate this Agreement without cause upon fifteen (15) days written notice to Scratchpay
  • Scratchpay may terminate this Agreement, and the Program, without cause upon fifteen (15) days written notice to Provider.
  • Notwithstanding termination by either party (i) the terms of this Agreement will continue to apply to any Customer Agreements that are in effect or Scratchpay Payment(s) occurring, prior to the effective termination date (by way of example, settlement, returns, submission of credits, and processing of chargebacks), and (ii) Scratchpay may use Provider’s name and marks for purposes of administering, collecting or liquidating Customer Agreements.
  • In the event of any termination, or at any time upon Scratchpay’s request, Provider will:(i) immediately return to Scratchpay any Scratchpay proprietary materials and information in Provider’s possession or control, including without limitation all Scratchpay confidential information. Any provisions of this Agreement (including, but not limited to, confidentiality, indemnity and obligations to fund and maintain the Settlement Account for six (6) months post-termination) that by their nature expressly or implicitly extend beyond termination will remain in effect in accordance with their terms.

15. Indemnification:

Provider agrees to indemnify, defend and hold Scratchpay and its affiliates, officers, directors, employees, and agents harmless from any losses, liabilities, and damages of any kind (including without limitation any costs, expenses or reasonable attorneys’ fees incurred by any indemnified party) arising out of any claim, complaint, or chargeback (i) made or claimed by a Client with respect to any sale made by Provider, (ii) made or claimed by any person or entity with respect to the treatment provided or the products or services sold or provided by Provider, or the advertising or promotion involving such treatment, products or services; (iii) caused by Provider’s noncompliance with the terms or covenants of this Agreement or with any provision of applicable law, including without limitation, the failure of any representation, warranty or covenant made by Provider to be true and correct when made or deemed made, (iv) caused by any voluntary or involuntary bankruptcy or insolvency proceeding by or against Provider, (v) caused by circumstances relating to Provider that create harm to or loss of goodwill to Scratchpay, (vi) arising out of or relating to any breach by Provider or a Representative of Provider of this Agreement. The indemnity provided under this Section shall survive the termination of this Agreement. In addition, Scratchpay is entitled to seek injunctive relieve and specific performance as a remedy and the Provider agrees not to oppose the granting of such relief to Scratchpay.

16. Miscellaneous:

  • Ownership of Customer Agreements and Information. Provider acknowledges that Scratchpay owns all Customer Agreements, and all information concerning borrowers, applicants and Customer Agreements obtained in connection with the Program, and that Provider has no ownership rights therein.
  • Assignability. Provider may not assign this Agreement, or its rights or obligations hereunder without the prior written consent of Scratchpay.
  • No Consequential Damages. Except with respect to indemnification of third-party claims set forth herein, (i) in no event shall either party be liable to the other for any special, incidental or consequential damages arising from such other party’s actions under this Agreement, and (ii) both parties waive any claim for punitive damages arising from the other party’s actions under this Agreement.
  • Choice of Law and Venue. This Agreement and the rights of the parties hereunder shall be determined, governed by and construed in accordance with the internal laws of the State of California without regard to conflicts of laws principles. Any dispute under this Agreement shall be resolved solely by arbitration having its situs within Los Angeles County, CA. USA. The parties consent and submit to the Arbitration Provision: By signing below, Provider agrees to this Jury Trial Waiver and to agree to Arbitration, and waive the right to go to court and waive Jury Trials
  • Attorneys’ Fees and Costs. For the parties’ mutual benefit, if any action is commenced to enforce or interpret, or in any way relates to this Agreement, the prevailing party is entitled to its reasonable attorneys’ fees and costs (legal costs, on a solicitor-own client basis).
  • Set-off. Scratchpay may set-off any amounts owing to Scratchpay by Provider from any amounts owing to Provider by Scratchpay. Scratchpay’s failure to set-off or deduct any amount will not constitute a waiver of Scratchpay’s right to set-off, deduct or collect such amount.
  • Entire Agreement; Written Modification Required. This Agreement constitutes the entire agreement pertaining to the subject matter hereof between the parties and is the final expression of the parties’ understanding in respect to all matters governed by this agreement. No prior discussions or communications shall form any part of this Agreement, unless expressly noted herein. Any modification to this Agreement must be in writing and must be accepted by the party undertaking the obligation. The Provider may not assign this Agreement, in whole or in part, without the prior written consent of Scratchpay. Provider may not subcontract (i) any of its obligations hereunder or (ii) the provision of goods or services to its Client who have entered into a Client Agreement without Scratchpay’s prior written consent. Any attempt to assign or subcontract without consent is void. Any approved subcontracts will be subject to all conditions of this Agreement, and Provider will be responsible for the performance of its subcontractors to the full extent as if employed directly by Provider. If any provision of this Agreement is held to be invalid or unenforceable, but would be valid and enforceable if appropriately modified, then such provision will apply with the modification necessary to make it valid and enforceable in accordance with its objectives. In any case, the remaining provisions of this Agreement will remain in full force and effect. The failure or delay of either party to insist on strict performance of any term or condition, or to exercise any right or remedy in this Agreement, is not intended, and will not be construed as, a waiver of any such right or remedy. Provider is an independent contractor with respect to Scratchpay, and nothing in this Agreement constitutes the parties as partners, joint venturers, co-owners or otherwise as participants in a joint or common undertaking, or allow either party to create or assume any obligation on behalf of the other party for any purpose whatsoever. This Agreement may be signed in two or more counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.
  • Notices. All notices and other communications under this Agreement shall be given in writing and shall be deemed to have been duly given and effective upon receipt if delivered in person, by recognized messenger service or by email. Any notice to Scratchpay must be sent to Scratchpay, 225 S. Lake Avenue, Suite 250, Pasadena, CA 91101 unless a different address for notice is later provided in writing by Scratchpay.
  • Provider Marks. Provider hereby grants Scratchpay a nonexclusive license to use its name, trademarks, logos and other marks in connection with the administration and operation of the Program, during and after the term of this Agreement.
  • Currency Indemnity. All payments to be made under this Agreement will be made in Canadian dollars (“Original Currency”). If Provider makes any payment to Scratchpay in a currency (the “Other Currency”) other than in Canadian dollars (whether voluntarily or pursuant to an order or judgment of a court or tribunal of any jurisdiction), such payment will constitute a discharge of the liability of Provider hereunder in respect of the amount owing only to the extent of the amount of the Original Currency which Scratchpay is able to purchase with the amount it receives on the date of receipt. If the amount of the Original Currency which Scratchpay is able to purchase is less than the amount of such currency originally due to it, Provider will indemnify and save Scratchpay harmless from and against any loss or damage arising as a result of such deficiency. This indemnity will constitute an obligation separate and independent from the other obligations contained in this Agreement, will give rise to a separate and independent cause of action, will apply irrespective of any indulgence granted by Scratchpay and will continue in full force and effect notwithstanding any judgment or order in respect of any amount due hereunder or under any judgment or order.
  • Taxes. All payments to be made by Provider hereunder will be made without deduction or withholding for any taxes (excluding taxes on Scratchpay’s net income), levies, duties, fees, restrictions or conditions of any nature whatsoever (collectively, “Indemnified Taxes”), unless required by applicable law. If at any time any applicable law requires Provider to make any such deduction or withholding from any such payment, Provider shall make any required deductions or withholdings, and if the required deduction or withholding is in respect of any Indemnified Tax then the amount payable to Scratchpay shall be increased so that the amount Scratchpay receives, after required deductions or withholdings, is the same as it would have received had such payments been made without such deduction or withholdings. Provider shall pay or remit the amounts deducted or withheld to the applicable governmental authority within the required time.