KAIZEN PAYMENT Agency Reputation & Conduct Policy Version 1.0 — Effective Upon Membership Activation

‍PREAMBLE
‍Kaizen Payment operates a competitive auction marketplace that connects small and mid-size businesses ("Debt Sellers") with licensed collection agencies ("Agencies") for the purpose of recovering outstanding commercial debt on a contingency basis. The integrity of this marketplace — and the trust that Debt Sellers place in it — depends entirely on the professional conduct of every Agency operating within it.This policy establishes the minimum standards of conduct, communication, and ethics that all Agencies must uphold when representing a Debt Seller's interests through the Kaizen Payment platform. It is not aspirational guidance. It is a binding condition of membership, and violations carry real consequences up to and including permanent removal from the platform.Every invoice uploaded to Kaizen Payment represents a real business relationship — a vendor, a contractor, a service provider — who delivered work in good faith and was not paid. Agencies bidding on these accounts are not simply purchasing paper. They are stepping into the role of a professional representative on behalf of that business. That role carries weight, and this policy defines how it must be carried.

‍SECTION 1: SCOPE & APPLICABILITY1.1 Who This Policy CoversThis policy applies to all entities and individuals who hold an active membership on the Kaizen Payment auction platform in the capacity of a collection agency, debt recovery firm, or independent collections professional. It applies regardless of membership tier and regardless of whether the Agency has actively won bids or is simply registered to bid.1.2 When This Policy Takes EffectThis policy takes effect at the moment of membership activation and remains in force continuously throughout the membership period and for any accounts the Agency is actively working, even if the membership is subsequently cancelled or suspended. Obligations related to accounts already in collection survive the termination of membership.1.3 Relationship to Applicable LawThis policy operates alongside — not instead of — all applicable federal, state, and local laws governing debt collection. Agencies must comply with the Fair Debt Collection Practices Act (FDCPA), applicable state collection licensing requirements, the Telephone Consumer Protection Act (TCPA), and any other regulatory framework governing their operations. Where this policy is more restrictive than applicable law, this policy governs. Where applicable law is more restrictive than this policy, applicable law governs.SECTION 2: LICENSING & ELIGIBILITY REQUIREMENTS2.1 Mandatory LicensingNo Agency may bid on, win, or work any account through the Kaizen Payment platform unless it holds all required collection licenses for the jurisdiction(s) in which it intends to operate. This includes a valid collection agency license in the Agency's home state of operation, any reciprocal or non-resident licenses required to contact debtors located in other states, and any surety bonds or insurance requirements mandated by state licensing authorities.2.2 License VerificationKaizen Payment reserves the right to request proof of licensure at any time, including at onboarding, upon renewal, and upon winning any individual bid. Agencies must provide documentation within five (5) business days of any such request. Failure to provide current, valid documentation will result in immediate suspension of bidding privileges pending review.2.3 License Lapse NotificationIf any required license lapses, is suspended, or is revoked by a regulatory authority, the Agency must notify Kaizen Payment in writing within twenty-four (24) hours of becoming aware of the change. The Agency must immediately cease all collection activity on platform accounts in the affected jurisdiction(s). Failure to self-report a license lapse is considered a material breach of this policy.2.4 FDCPA Compliance CertificationAll Agencies must certify at the time of membership activation, and annually thereafter, that they are familiar with and in compliance with the Fair Debt Collection Practices Act. This certification does not substitute for legal counsel, and Kaizen Payment strongly recommends that Agencies maintain ongoing compliance training programs for all collection staff.SECTION 3: REPRESENTING THE DEBT SELLER'S BRAND & REPUTATIONWhen an Agency wins a bid on Kaizen Payment, it is not simply collecting a debt. It is acting as a de facto representative of the Debt Seller's business in its final interaction with a non-paying customer. That interaction — how it is conducted, what is said, and how it concludes — reflects on the Debt Seller's reputation whether or not the Debt Seller is ever aware of it.3.1 Professional IdentificationWhen contacting a debtor, the Agency must identify itself clearly and accurately. The Agency may not claim to be the Debt Seller, its employees, or its representatives. It may not misrepresent its role as anything other than a third-party collection agency, and may not use a name or trade name that could be confused with the Debt Seller's business name. The Agency must, upon request, be able to confirm which creditor the debt originated from and provide accurate account information consistent with what was uploaded to the Kaizen Payment platform.3.2 Tone & Communication StandardsAll communication with debtors must be conducted in a professional, respectful, and non-threatening manner. The following conduct is strictly prohibited regardless of the debtor's responsiveness, payment history, or attitude: using profane, abusive, or demeaning language of any kind; making threats of legal action that the Agency does not intend to carry out or does not have authority to pursue; calling outside of legally permitted hours; contacting debtors at their place of employment when the Agency has reason to know the employer prohibits such communication; engaging in repeated or continuous calls intended to harass rather than communicate; and disclosing the existence of the debt to any third party except as expressly permitted by law.3.3 Accuracy of ClaimsAgencies must only communicate accurate, verified information about the debt. This includes the original creditor name, the outstanding balance, and any interest or fees that have been properly disclosed and authorized. Agencies may not inflate the balance beyond what is documented in the uploaded invoice, claim that legal proceedings have been initiated when they have not, or misrepresent the legal status of the debt including its collectability or statute of limitations status.3.4 Written Communication StandardsAll written correspondence — letters, emails, and text messages — must comply with FDCPA disclosure requirements, including the required validation notice on initial written communication. Agencies must retain copies of all written communications for a minimum of three (3) years and make them available to Kaizen Payment upon request.3.5 Protecting the Underlying Business RelationshipMany Debt Sellers on the Kaizen Payment platform have ongoing or previously positive relationships with the debtor in question. Agencies are expected to approach collection as a resolution-focused process, not an adversarial one. They must explore and offer reasonable payment arrangements before escalating to more aggressive tactics, and must avoid any conduct that would permanently damage the Debt Seller's reputation or relationship with the debtor beyond what the non-payment itself has already caused.SECTION 4: ACCOUNT HANDLING & REPORTING OBLIGATIONS4.1 Account Acceptance & ScopeBy winning a bid on the Kaizen Payment platform, the Agency accepts full operational responsibility for the account as described in the uploaded invoice. The Agency may not reassign, subcontract, or sell the account to a third party without prior written approval from Kaizen Payment, expand the scope of collection activity beyond the specific invoice and debtor identified in the platform listing, or pursue the debtor for any obligation not related to the Kaizen Payment account without separately disclosing this relationship.4.2 Progress ReportingAgencies are required to provide status updates on active accounts as follows: an initial contact attempt confirmation within five (5) business days of winning the bid; a status update at thirty (30) days including number of contact attempts, debtor response status, and any payment arrangements made; a status update at sixty (60) days including any material changes to account status; and a final resolution report upon account closure, whether by payment, settlement, return, or formal write-off.4.3 Payment HandlingAll payments collected on behalf of a Debt Seller must be deposited into a properly maintained trust or escrow account separate from the Agency's operating funds. They must be remitted to the Debt Seller net of the agreed contingency fee within thirty (30) days from the date of collection, accompanied by a clear and itemized accounting of the gross amount collected, the contingency fee retained, and the net amount remitted.4.4 Account Return ObligationsIf an Agency determines that an account is uncollectable or wishes to cease work for any reason, the Agency must formally return the account to Kaizen Payment with a written summary of all collection activity taken. Accounts may not simply be abandoned. Formal return releases the Agency from future reporting obligations but does not release it from obligations related to any payments already collected.SECTION 5: DATA PRIVACY & INFORMATION SECURITY5.1 Permitted Use of Debt Seller InformationAll information provided by or about a Debt Seller through the Kaizen Payment platform is confidential and may only be used for the specific purpose of collecting the account for which it was provided. Agencies may not use Debt Seller or debtor information for marketing, prospecting, or any unrelated purpose; share Debt Seller information with any third party except as strictly necessary for collection activity; or retain debtor data beyond statutory and regulatory retention requirements after an account is closed.5.2 Data Security StandardsAgencies must maintain reasonable and industry-standard data security measures to protect all information accessed through the Kaizen Payment platform. In the event of a data breach or unauthorized access affecting any Debt Seller or debtor data obtained through the platform, the Agency must notify Kaizen Payment within forty-eight (48) hours of discovery.5.3 Consumer Dispute HandlingUpon receipt of a consumer dispute, the Agency must immediately cease collection activity on the disputed amount, verify the debt using the documentation provided by the Debt Seller through the platform, respond to the consumer in writing within thirty (30) days with verification or a statement that the debt cannot be verified, and notify Kaizen Payment of the dispute and its resolution within five (5) business days of resolution.SECTION 6: REPUTATION SCORING & PERFORMANCE STANDARDS6.1 The Kaizen Reputation ScoreKaizen Payment maintains a proprietary Reputation Score for each registered Agency. This score is calculated based on collection recovery rate relative to account age and type, timeliness and completeness of status reporting, number and nature of consumer complaints received, number and outcome of regulatory inquiries or enforcement actions, Debt Seller satisfaction ratings submitted after account closure, and speed and accuracy of payment remittance.6.2 Minimum Performance ThresholdsAgencies must maintain a Reputation Score above the minimum threshold established for their membership tier in order to retain active bidding privileges. Agencies whose scores fall below the minimum threshold will be placed on a sixty (60) day performance improvement period during which bidding privileges may be restricted and a formal remediation plan must be submitted within ten (10) business days.6.3 Debt Seller ReviewsAfter each account is resolved, Kaizen Payment will invite the Debt Seller to submit a rating and review of the Agency's performance. These reviews are a material input into the Reputation Score and may be made visible to prospective Debt Sellers in an anonymized aggregate form. Agencies may not contact Debt Sellers directly to influence, request, or discourage reviews.SECTION 7: PROHIBITED CONDUCT & ZERO-TOLERANCE VIOLATIONSThe following conduct constitutes a zero-tolerance violation and will result in immediate and permanent suspension from the Kaizen Payment platform without refund of any membership fees, regardless of circumstances or prior record:Misappropriation of funds collected on behalf of a Debt Seller.Providing false or materially misleading information to Kaizen Payment, including falsified license documentation, fabricated reporting, or concealed regulatory actions.Any collection conduct that constitutes harassment, abuse, or oppression under the FDCPA or applicable state law.Unauthorized resale, subcontracting, or transfer of any account won through the platform.Contacting or soliciting Debt Sellers outside of the Kaizen Payment platform in connection with accounts accessed through the platform.Using debtor or Debt Seller information obtained through the platform for any purpose other than the specific collection engagement.Retaliating against a Debt Seller for submitting a negative review or complaint.Operating without required licensure in any jurisdiction in which collection activity is conducted.SECTION 8: COMPLAINT & GRIEVANCE PROCESS8.1 Reporting a ViolationDebt Sellers, debtors, and third parties who believe an Agency has violated this policy may submit a formal complaint to Kaizen Payment through the designated compliance channel. Complaints must include the account identifier, a description of the alleged conduct, and any supporting documentation. Anonymous complaints will be accepted but may limit the scope of investigation.8.2 Investigation ProcessUpon receipt of a complaint, Kaizen Payment will acknowledge receipt within two (2) business days, notify the Agency of the complaint and provide ten (10) business days to respond, conduct a review of available evidence, and issue a determination within thirty (30) days of complaint receipt. Determinations may include no action, a formal warning, suspension, remediation requirements, or permanent removal.8.3 Agency Right to AppealAgencies may appeal any adverse determination by submitting a written appeal within fifteen (15) days of the determination notice. Appeals must present new evidence or arguments not previously considered. Kaizen Payment will issue a final determination on the appeal within twenty-one (21) days. The decision on appeal is final.SECTION 9: ENFORCEMENT LEVELSLevel 1 — Minor: Late reporting, incomplete updates, minor communication lapses. Consequence: formal written warning and remediation plan required.Level 2 — Moderate: Repeated minor violations, a single substantiated FDCPA complaint, failure to self-report a license issue. Consequence: sixty (60) day remediation period, bidding restrictions, and Reputation Score impact.Level 3 — Serious: Multiple substantiated complaints, misrepresentation in reporting, repeated failure to remit timely. Consequence: suspension pending investigation and possible permanent removal.Level 4 — Zero Tolerance: Misappropriation, fraud, harassment, unauthorized data use, unlicensed collection. Consequence: immediate permanent removal and referral to regulatory authorities as appropriate.SECTION 10: AMENDMENTS & POLICY UPDATESKaizen Payment reserves the right to amend this policy at any time. Agencies will be notified of material changes via the email address associated with their membership account no fewer than fourteen (14) days before changes take effect. Continued use of the platform after the effective date of any amendment constitutes acceptance of the revised policy.By activating or maintaining an active membership on the Kaizen Payment auction platform, the Agency acknowledges that it has read, understood, and agrees to be bound by this Reputation & Conduct Policy in its entirety.Questions? Contact compliance@kaizenpaymement.com