Exhibit 10.10
PROFESSIONAL SERVICES AGREEMENT
by and between
eFUNDS CORPORATION
[LOGO OF EFUNDS CORPORATION APPEARS HERE]
and
DELUXE CORPORATION
[LOGO OF DELUXE CORPORATION APPEARS HERE]
05/15/00
[LOGO OF E FUNDS, INC. APPEARS HERE] [LOGO OF DELUXE CORPORATION APPEARS HERE]
eFunds/Deluxe Corporation
Professional Services Agreement
TABLE OF CONTENTS
1.0 PURPOSE..............................................................1
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2.0 DEFINITIONS..........................................................1
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3.0 SCOPE OF WORK........................................................4
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3.1 Statements of Work..........................................4
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3.2 Authorization to Perform Services...........................4
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3.3 Authority and Responsibility of Deluxe......................4
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3.4 Work Orders Under Protest...................................5
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4.0 MANAGEMENT AND STAFFING..............................................5
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4.1 Management Plan.............................................5
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4.2 eFunds Account Manager......................................5
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4.3 Deluxe Relationship Manager.................................6
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4.4 Management Committee........................................6
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4.5 Executive Committee.........................................6
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4.6 Reporting...................................................7
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4.7 Key Employees...............................................7
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4.8 Nonsolicitation.............................................8
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4.9 Subcontractors..............................................9
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5.0 COMPENSATION.........................................................10
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5.1 Aggregate Minimum Annual Fees...............................10
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5.2 Bonuses and Credits.........................................10
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5.3 Invoices....................................................10
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5.4 Payment Terms...............................................11
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5.5 Taxes.......................................................12
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5.6 Late Payment Interest.......................................12
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5.7 Gain Sharing................................................13
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6.0 DELUXE RESPONSIBILITIES..............................................14
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6.1 Deluxe Facilities...........................................14
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6.2 Deluxe Personnel and Equipment..............................14
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6.3 Third Party Consents........................................15
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6.4 Back-ups....................................................15
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[LOGO OF E FUNDS, INC. APPEARS HERE] [LOGO OF DELUXE CORPORATION APPEARS HERE]
eFunds/Deluxe Corporation
Professional Services Agreement
7.0 PERFORMANCE STANDARDS................................................16
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7.1 Service Level Requirements and Measurement..................16
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7.2 User Satisfaction Surveys...................................16
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8.0 AUDITS...............................................................17
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8.1 Service Level Audit.........................................17
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8.2 Fee Audit...................................................18
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8.3 Service Audit...............................................19
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8.4 Benchmark Audit.............................................20
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8.5 eFunds Internal or External Audits..........................20
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8.6 Cooperation with Audits; Follow-Up..........................21
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8.7 Books and Records...........................................21
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9.0 OWNERSHIP AND LICENSES...............................................22
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9.1 Deluxe Data and Databases...................................22
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9.2 Deluxe Software.............................................23
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9.3 Third Party Software........................................24
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9.4 eFunds Materials............................................25
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9.5 Key Deliverables............................................25
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9.6 Inventions..................................................26
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10.0 CONFIDENTIALITY......................................................26
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10.1 Deluxe and eFunds Responsibilities..........................26
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10.2 Exceptions..................................................27
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11.0 WARRANTIES AND COVENANTS.............................................27
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11.1 Deluxe Warranties to eFunds.................................27
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11.2 EFUNDS Warranties to Deluxe.................................28
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11.3 Deluxe's Remedies...........................................28
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11.4 Warranty Disclaimer.........................................29
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11.5 Certain Covenants...........................................29
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12.0 INDEMNITIES..........................................................30
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12.1 Indemnity by eFunds.........................................30
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12.2 Indemnity by Deluxe.........................................31
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12.3 Indemnification Procedures..................................32
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13.0 TERM AND TERMINATION.................................................32
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13.1 Term........................................................32
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13.2 Termination of a Statement of Work or Work
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Order for Cause.............................................32
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[LOGO OF E FUNDS, INC. APPEARS HERE] [LOGO OF DELUXE CORPORATION APPEARS HERE]
eFunds/Deluxe Corporation
Professional Services Agreement
13.3 Termination of Agreement for Cause..........................33
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13.4 Termination For eFunds' Change of Control...................34
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13.5 Termination Through Insolvency..............................35
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13.6 Termination Assistance......................................35
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13.7 Survival....................................................37
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14.0 LIMITATION OF LIABILITY..............................................38
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14.1 Damage Limits...............................................38
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14.2 Damage Waiver...............................................38
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15.0 LAW AND DISPUTES.....................................................39
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15.1 Governing Law...............................................39
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15.2 Dispute Handling............................................39
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15.3 Problem Escalation Procedures...............................40
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15.4 Arbitration.................................................40
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15.5 Continued Performance.......................................42
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15.6 Limitation of Actions.......................................42
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16.0 PROVISION OF INSURANCE...............................................42
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16.1 General.....................................................42
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16.2 Coverage....................................................43
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17.0 GENERAL..............................................................44
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17.1 Notices.....................................................44
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17.2 Reasonable Behavior.........................................45
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17.3 Assignment..................................................45
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17.4 Integration; Amendment......................................46
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17.5 Severability................................................46
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17.6 Order Of Precedence.........................................46
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17.7 No Waiver...................................................46
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17.8 Force Majeure...............................................47
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17.9 Non-Use of Deluxe's Name....................................48
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[LOGO OF E FUNDS, INC. APPEARS HERE] [LOGO OF DELUXE CORPORATION APPEARS HERE]
eFunds/Deluxe Corporation
Professional Services Agreement
PROFESSIONAL SERVICES AGREEMENT
THIS PROFESSIONAL SERVICES AGREEMENT ("Agreement") is dated as of April
1, 2000 (the "Effective Date") by and between Deluxe Corporation
("Deluxe"), a Minnesota corporation having its principal place of
business at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and eFunds
Corporation ("eFunds"), a Delaware corporation having its principal
place of business at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
1.0 PURPOSE.
This Agreement (with its attached exhibits and schedules) provides the
terms and conditions under which eFunds shall provide Application
Development, Application Support and Repair, Financial Shared Services,
CI Order Entry Services and similar professional information
technology, business process and related (collectively, "IT")
outsourcing services to Deluxe and its Affiliates on a non-exclusive
basis.
2.0 DEFINITIONS.
The following capitalized terms used in the Contract Documents shall
have the meanings given below or in the context in which such terms are
used, as the case may be.
"Affiliate" means any entity that controls, is controlled by or is
under common control with a party hereto, with control meaning the
ownership of more than fifty percent (50%) of the equity or the right
to direct the management of such entity provided, however, that Deluxe
and its subsidiaries (other than eFunds and its subsidiaries) shall not
be considered Affiliates of eFunds and eFunds and its subsidiaries
shall not be considered Affiliates of Deluxe.
"Application Development" means the provision of professional services
related to the development of new application software and
enhancements.
"Application Support and Repair" means the provision of professional
services related to identifying and repairing application software
defects necessary to keep application systems operating at their
released functionality.
"CI Order Entry Services" means the provision of professional services
related to Deluxe's Customer Interface production systems.
Confidential and Proprietary 1
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[LOGO OF E FUNDS, INC. APPEARS HERE] [LOGO OF DELUXE CORPORATION APPEARS HERE]
eFunds/Deluxe Corporation
Professional Services Agreement
"Confidential Information" means the provisions of this Agreement and
other Contract Documents to the extent that such provisions or other
Contract Documents are not filed with the Securities and Exchange
Commission ("SEC") by either Deluxe or eFunds or, if filed, are granted
confidential treatment by the SEC and all proprietary information of a
party that such party treats as confidential, including, without
limitation, specifications, software, diagrams, information, data,
materials, markets, customers, suppliers, inventions, products,
procedures, designs, research and development, business plans,
financial projections, organizations, employees or consultants or any
other similar aspects of or information related to the present or
future business of either party.
"Contract Documents" mean this Agreement, its Statements of Work,
exhibits and schedules, if any, and Work Orders, as each may be amended
from time to time.
"Fees" means fees for the Services to be paid by Deluxe to eFunds under
the Contract Documents.
"Financial Shared Services" mean the provision of professional services
related to the finance functions of Accounts Payable, Accounts
Receivable, and General Accounting.
"Key Deliverables" mean any technology, software, capability, solution,
process or tangible materials to be developed by eFunds and delivered
to Deluxe that are designated in a Statement of Work or Work Order as
being subject to a formal acceptance process. Key Deliverables may be
either Written Deliverables or Software Deliverables.
"Key Employees" mean any eFunds employees listed on Exhibit A of this
Agreement or as so designated in any other Contract Document.
"Labor Category" means the labor categories in the master management
plan specified in Section 4.1, as amended from time to time by mutual
agreement, to enable proper tracking of activities as they relate to
capitalization versus expense.
"Project Plan" means a mutually agreed upon document that lists all
activities, tasks and Key Deliverables for a particular project
involving Services to be provided under a particular Work Order. The
Project Plan may include time/duration estimates, cost estimates,
acceptance test procedures for Key Deliverables and resource
assignments for each activity/task that makes up the applicable
project. The Project Plan forms the baseline parameters for that
project, which parameters may subsequently be amended only by the
written agreement of the parties.
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eFunds/Deluxe Corporation
Professional Services Agreement
"Reimbursable Expenses" mean incidental expenses reasonably incurred by
eFunds in performing its obligations under the Contract Documents.
eFunds shall observe Deluxe's Travel & Entertainment policies when such
activities are required for provision of Services under any Contract
Document.
"Services" means the Application Development, Application Support and
Repair, CI Order Entry Services, Financial Shared Services and any
other IT services performed hereunder by eFunds or an Affiliate of
eFunds pursuant to a Contract Document.
"Software Deliverables" mean Key Deliverables that are operational
software (either a completed system or any module, subsystem or
release) as designated in a Work Order.
"Specifications" mean a mutually agreed upon document which describes
the functional and technical specifications for a Key Deliverable and
which are designated in a Work Order as the specifications upon which
development of the Key Deliverable shall be based.
"Standard Operating Procedures ("SOP")" means Deluxe's documentation,
guidelines, procedures, standards and like work listed in Exhibit B of
this Agreement. Such work may be updated by Deluxe from time to time
during the term of this Agreement.
"Statement of Work" means a mutually agreed upon document which
describes generally a particular class or type of Service to be
provided by eFunds hereunder.
"Term" means the term of this Agreement as stated in Article 13.0.
"Work Order" means a document substantially in the form attached as
Exhibit C and signed by authorized representatives of both parties or,
as applicable, one of their respective Affiliates, referencing the
applicable Statement of Work under which Deluxe or an Affiliate
requests certain Services from eFunds and eFunds agrees to perform such
Services hereunder upon the terms specified therein.
"Written Deliverables" are documents, such as reports, system designs
or documentation as designated in a Project Plan or Work Order.
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eFunds/Deluxe Corporation
Professional Services Agreement
3.0 SCOPE OF WORK.
3.1 Statements of Work.
Each separate professional service category under this Agreement shall
be generally described in a Statement of Work. The initial Statements
of Work for each of the following types of Services are attached to
this Agreement: Application Development (01), Application Support and
Repair (02), Financial Shared Services (03) and CI Order Entry Services
(04). Subject to Deluxe's fixed minimum annual obligations to eFunds
under Section 5.1 and the applicable Statements of Work, each party
acknowledges that a Statement of Work does not, in and of itself,
constitute authorization for the performance of any specific Services
or the commitment by Deluxe to pay any particular Fees for such
specific Services, which authorization will be contained in an
applicable Work Order.
3.2 Authorization to Perform Services.
Deluxe or an Affiliate of Deluxe may order Services from eFunds under
any current Statement of Work by executing a Work Order. Within one
hundred twenty (120) days of the Effective Date, Deluxe and eFunds
shall establish a mutually acceptable written procedure for the
preparation and appropriate approval and execution of Work Orders for
such ordered Services, including procedures for Work Orders issued by
Affilates of Deluxe. Until such time as such written procedure has been
approved by both parties, eFunds shall perform such Services as are
approved in writing by Deluxe's Relationship Manager (as defined in
Section 4.3). For the purposes of this Agreement, each such written
directive or approval shall be treated as a Work Order. Deluxe shall be
obligated to pay for Services and eFunds shall be obligated to perform
such Services only pursuant to such a duly approved and executed Work
Order. No accepted Work Order shall be deemed amended or modified
except upon the express written approval of the parties.
3.3 Authority and Responsibility of Deluxe.
Deluxe shall be entitled to enforce the terms and conditions of any
Work Order from an Affiliate as if such Work Order had been issued
directly by Deluxe. Deluxe shall be exclusively responsible for payment
of any Services performed under any Work Order issued by an Affiliate
hereunder. All invoices from eFunds for any Services performed under
any Work Order issued by Deluxe or an Affiliate shall be submitted
centrally for payment pursuant to Section 4.2.
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eFunds/Deluxe Corporation
Professional Services Agreement
3.4 Work Orders Under Protest.
If Deluxe issues a proposed Work Order that Deluxe declares in writing
to be for critical Services, in its reasonable judgment, and eFunds is
unable to agree with Deluxe about the nature or amount of compensation
to be paid to eFunds for the Services under such proposed Work Order,
eFunds shall proceed with such Services as a Work Order under protest,
and the parties shall then continue to negotiate in good faith about
such compensation terms. If the parties have not resolved their
differences on such terms within fifteen (15) days of commencement of
the relevant Services, either party may refer the matter to dispute
resolution under Article 15.0.
4.0 MANAGEMENT AND STAFFING.
4.1 Management Plan.
Within one hundred twenty (120) days after the Effective Date, after
consultation with Deluxe, eFunds shall provide Deluxe a proposed master
management plan for delivery of all Services, describing the following
management and control processes: (a) operating processes and
procedures relating to the performance of the Services, (b) periodic
reporting and measurement of actual levels of performance versus the
applicable performance standards and service levels described elsewhere
in this Agreement; and (c) descriptions of the management and control
structures and audit procedures recommended by eFunds within Deluxe and
eFunds to optimize delivery, monitoring, auditing and performance of
the Services in a timely, efficient and cost-effective manner. The
parties shall meet and confer about such master management plan and
shall adopt such plan in good faith to provide overall guidance for
their relationship. Notwithstanding the foregoing, the management plan
shall be subject to Deluxe's reasonable approval.
4.2 eFunds Account Manager.
eFunds shall appoint and notify Deluxe of the individual who shall be
the primary point of contact for eFunds under the Contract Documents
and who shall be the central manager for performance of the Services on
a full-time basis (the "eFunds Account Manager"). The eFunds Account
Manager shall receive all communications or notices directed to eFunds
and shall have authority to make binding commitments for eFunds under
the Contract Documents. Any eFunds Account Manager or replacement
manager shall be subject to Deluxe's approval, which approval shall not
be unreasonably withheld.
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Professional Services Agreement
4.3 Deluxe Relationship Manager.
Deluxe shall appoint and notify eFunds of the individual who shall be
the primary point of contact for Deluxe under the Contract Documents
and who shall be the central manager of Work Orders for the Services on
a full-time basis (the "Deluxe Relationship Manager"). The Deluxe
Relationship Manager shall receive all communications or notices
directed to Deluxe and shall have authority to make binding commitments
for Deluxe under the Contract Documents.
4.4 Management Committee.
The Management Committee shall consist of the Deluxe Relationship
Manager and the eFunds Account Manager with advisory members from each
party or its Affiliates as deemed appropriate. The responsibilities of
the Management Committee include the following: (a) ensure sufficient
and continued communications between Deluxe and eFunds; (b) attempt to
resolve disputes by mutual agreement, with escalation to the Executive
Committee as necessary; (c) review price changes and amendments to the
Contract Documents; (d) review Deluxe and eFunds responsibilities under
the Contract Documents; (e) review performance reports, including
service level reports; (f) review and analyze workload trends and
variances from plan; (g) analyze and review credits or bonuses, as
appropriate, between Deluxe and eFunds under the appropriate Statements
of Work and in light of actual payments made under invoices pursuant to
Work Orders; and (h) undertake such other responsibilities as Deluxe
and eFunds may agree from time to time. The Management Committee shall
meet monthly within fifteen (15) days following the close of the prior
month, unless Deluxe and eFunds agree to a different schedule.
4.5 Executive Committee.
The Executive Committee shall consist of senior-level executives of
Deluxe and eFunds with advisory members from each company as deemed
appropriate. The responsibilities of the Executive Committee include
the following: (a) perform a semi-annual review of Deluxe business
planning initiatives and expected changes as they relate to the
Services provided by eFunds; (b) perform a semi-annual review of eFunds
plans to support Deluxe's business; (c) review semi-annual performance
evaluation reports (d) attempt to resolve by mutual agreement any
disputes escalated by the Management Committee; and (e) undertake such
other responsibilities as Deluxe and eFunds may agree from time to
time. The Executive Committee shall meet quarterly within thirty (30)
days following the close of the prior quarter, unless Deluxe and eFunds
agree to a different schedule.
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eFunds/Deluxe Corporation
Professional Services Agreement
4.6 Reporting.
eFunds shall provide Deluxe with such documentation and other
information as may be reasonably requested by Deluxe from time to time
to verify that eFunds' performance of the Services is in compliance
with the terms and conditions of the Contract Documents. The content
and format of these reports shall be recommended by the Management
Committee and approved by the Executive Committee. eFunds shall provide
at least monthly reports to Deluxe according to the requirements and
provisions of the applicable Statements of Work and Work Orders.
4.7 Key Employees
Exhibit A is a list of individuals who shall be deemed Key Employees
under the Contract Documents. By mutual agreement, the parties may
modify or amend such list from time to time. The parties may also
designate other individuals as Key Employees from time to time under
any Statement of Work or Work Order. eFunds shall not reassign to
another account any Key Employee without (a) providing at least
forty-five (45) days prior written notice thereof to Deluxe for all Key
Employees who are identified as managers and at least ten (10) days
prior written notice thereof to Deluxe for all other Key Employees and
(b) nominating replacement personnel of at least equal competence and
experience reasonably acceptable to Deluxe. eFunds shall also promptly
replace any Key Employee who terminate their employment with eFunds or
its Affiliates or to whom Deluxe reasonably objects with another
individual with competence and experience reasonably acceptable to
Deluxe. If eFunds requests Deluxe to permit any Key Employee to take a
temporary assignment to another site or account for less than five (5)
days and if such temporary assignment will not materially and adversely
affect any Services, in Deluxe's reasonable judgment, Deluxe shall
reasonably cooperate with such request.
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eFunds/Deluxe Corporation
Professional Services Agreement
4.8 Nonsolicitation
During the Term and for a period of six (6) months thereafter, neither
party shall, either directly or indirectly, solicit for employment by
itself (or any of its Affiliates) any employee of the other party (or
any of its Affiliates) who, at the time of the solicitation is an
employee of such party, and has been involved in the performance of the
party's obligations under the Contract Documents, unless the hiring
party obtains the written consent of the other party. Notwithstanding
the foregoing, if there is a termination of this Agreement for any
reason and the entry into a period of termination assistance under
Section 13.6, Deluxe or its designee may, directly or indirectly,
solicit for employment any eFunds employees (including, without
limitation, Key Employees) who have performed Services for Deluxe
within one (1) year of the effective date of the termination notice.
For the purposes of this Section 4.8, a notice of a job listing or
opening, advertisement or similar general publication of a job search
or availability shall not be construed as a solicitation, and the
hiring of any such employee who responds thereto shall not be a breach
of this Section 4.8.
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eFunds/Deluxe Corporation
Professional Services Agreement
4.9 Subcontractors.
eFunds shall not subcontract all or any part of the Services provided
to Deluxe hereunder without the express prior written consent of
Deluxe, which consent shall not be unreasonably withheld, provided,
however, eFunds may delegate the performance of any Services to its
wholly-owned subsidiares upon written notice thereof to Deluxe. Any
work performed or to be performed by an eFunds' Affiliate which is not
a wholly-owned subsidiary shall be specifically subject to Deluxe's
approval which may be given or withheld in Deluxe's reasonable
discretion. Deluxe's approval of a subcontractor shall not relieve
eFunds of its obligations under the Contract Documents, and eFunds
shall remain responsible for the performance of each such subcontractor
and its employees and for their compliance with all Contract Documents
as though they were eFunds' own employees. eFunds shall specifically
require each subcontractor performing Services under any Contract
Document who has access to Deluxe's Confidential Information in the
course of performing such Services to be bound by the confidentiality
and intellectual property assignment or license provisions of this
Agreement, and, at Deluxe's direction, to execute a non-disclosure or
intellectual property assignment or license agreement that is
reasonably satisfactory to Deluxe. Deluxe may request that a particular
subcontractor be replaced if it reasonably believes that the Services
being provided by such subcontractor are not adequate, and eFunds shall
do so in a timely and commercially reasonable manner. Nothing contained
in any Contract Document shall create any contractual relationship
between Deluxe and any eFunds subcontractor or supplier. eFunds shall
bind each of its subcontractors and suppliers by the terms and
conditions of the Contract Documents, as far as appropriate and
applicable, to the work to be performed by the subcontractor or
supplier. eFunds shall be fully responsible to Deluxe for the acts and
omissions of any eFunds subcontractors and suppliers and of persons
directly or indirectly employed or contracted by any of them.
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Professional Services Agreement
5.0 COMPENSATION.
5.1 Aggregate Minimum Annual Fees.
In each year or prorated part of each year during the Term, Deluxe
shall pay eFunds the following aggregate minimum annual Fees (as
prorated for any part years in the Term), subject to the specific terms
and conditions set forth in each then-current Statement of Work for the
relevant services: Application Development Services and Application
Support and Repair Services (collectively, approximately U.S.
$43,000,000 per calendar year); Financial Shared Services
(approximately U.S. $2,200,000 in calendar 2000 and declining gradually
to approximately U.S. $1,800,000 in calendar 2004); and CI Order Entry
Services (approximately U.S. $5,900,000 in calendar 2000 and declining
gradually to approximately U.S. $2,400,000 in calendar 2004).
Such payments of Fees shall be comprised of the individual monthly or
other payments made by Deluxe to eFunds under the specific Work Orders
in effect during such periods. If Deluxe exceeds its aggregate minimum
annual Fees under any Statement of Work during any calendar year or
prorated part thereof during the Term, eFunds shall pay to Deluxe the
rebates as specified in such Statement of Work. If Deluxe falls short
of its aggregate minimum annual Fees under any Statement of Work during
any calendar year or prorated part thereof during the Term, in full
satisfaction of such commitment, Deluxe shall pay to eFunds the
compensatory payments as specified in such Statement of Work.
5.2 Bonuses and Credits.
A Statement of Work or Work Order may provide for Deluxe to pay bonuses
to eFunds if eFunds exceeds its specified service levels as and when
specified therein and may also provide for eFunds to give credits to
Deluxe if eFunds falls short of its specified service levels as and
when specified therein. Such bonuses or credits shall be in addition
to, and not in lieu of, any other remedies that either party may have
under such Contract Documents, at law or in equity. When applicable,
the measurement and monitoring methods in Section 7.1 shall be used to
determine the allocation of such bonuses and credits.
5.3 Invoices.
eFunds shall submit all invoices for Services performed for Deluxe or
any Affiliate to Deluxe at the following address:
Deluxe Corporation
Attention: Accounts Payable
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Professional Services Agreement
Unless the Statement of Work or Work Order provides otherwise, invoices
for Fees and Reimbursable Expenses shall be submitted to Deluxe monthly
by the tenth (10th) day following the end of the month in which the
Services were performed. Non-monthly invoices for any other
extraordinary items shall be submitted to Deluxe as the amounts come
due. Each invoice shall identify the Work Order to which it relates and
shall reasonably substantiate the basis for the amounts invoiced. For
any Services being invoiced on a "time and materials" basis, the
invoice shall also state the total number of hours worked by Labor
Category. Upon Deluxe's request, eFunds shall provide copies of any
third party statements or invoices to substantiate claims for
Reimbursable Expenses.
5.4 Payment Terms.
Deluxe shall pay all Fees and Reimbursable Expenses to eFunds in United
States Dollars, by wire transfer of funds to an account designated by
eFunds. eFunds' invoices are due and payable within thirty (30) days
from receipt thereof. If there are any good faith disputes related to
an invoice, Deluxe shall pay the undisputed portion of the invoice on a
timely basis and notify eFunds in writing of Deluxe's basis for
withholding payment of the disputed amount. Disputes with respect to
invoiced amounts shall be deemed waived if not raised in writing within
such thirty (30) day period. Upon receipt of Deluxe's dispute notice,
eFunds and Deluxe shall work together in good faith to resolve such
dispute in a prompt and mutually acceptable manner. If the dispute is
not resolved within thirty (30) days after eFunds' receipt of Deluxe's
dispute notice, the parties shall resolve the issue pursuant to the
provisions of Article 15.0. Deluxe shall pay any disputed amounts
within five (5) days after all questions have been resolved.
Notwithstanding, the foregoing, if Deluxe terminates a Work Order,
Statement of Work or this Agreement under Section 13.2, 13.3 or 13.5,
Deluxe shall be entitled to set off any Fees and Reimbursable Expense
otherwise payable by Deluxe to eFunds against Direct Damages or
Consequential or Incidental Damages experienced by Deluxe or its
Affiliates to the extent permitted by this Agreement.
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5.5 Taxes.
Except as otherwise provided in this Section 5.5, eFunds shall pay all
taxes, including, without limitation, any charges, fees, duties,
levies, imposts, rates or other assessments imposed by any federal,
state, local or foreign taxing authority, including, but not limited
to, income, profits, gross receipts, excise, property, license, capital
stock, franchise, transfer, payroll, withholding, social security,
other employment tax or other taxes, and any interest, penalties or
additions attributable thereto assessed or levied against eFunds or its
Affiliates in respect of the Services performed under this Agreement
("Taxes"). eFunds shall hold Deluxe, its officers, directors, employees
and agents harmless from any non-payment or underpayment of such Taxes.
Deluxe shall pay any applicable sales, use or value added tax, however
designated or levied, import or export duty or other similar tax or
charge on the Services or materials provided with the Services.
5.6 Late Payment Interest.
For any undisputed amounts not paid by Deluxe within thirty (30) days
after its receipt of the invoice therefore and for any amounts disputed
by Deluxe that are ultimately resolved in favor of eFunds, eFunds may
collect the "prime rate" as published in The Wall Street Journal
(currently defined as the base rate on corporate loans posted by at
least 75% of the nation's 30 largest banks, but however the same may be
from time to time defined; the "Prime Rate") plus 2.5%, or the maximum
rate allowed by law, whichever is less. Such interest shall begin to
accrue on the thirty-first (31st) day after Deluxe's receipt of eFunds'
invoice and shall accumulate on the outstanding balance on a daily
basis until paid in full.
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5.7 Gain Sharing.
eFunds shall work with Deluxe to identify potential savings in the
Services and shall make recommended changes to the methods and
processing used by Deluxe. Upon mutual agreement, the identified
potential savings or improved processing techniques shall be researched
and a proposal shall be presented to Deluxe. eFunds' proposal shall
include the estimated current costs, the recommended changes and the
projected savings or service improvements to Deluxe and a proposed Work
Order setting forth each party's responsibilities to achieve the
savings or improvements. In the case of improved Services, a mutually
agreed to value shall be assigned to such improved Services and shall
be used as the basis for any gain sharing. Upon the parties' execution
of a Work Order, a Project Plan shall be developed by eFunds to
accomplish the change. Deluxe shall compensate eFunds for such savings
or service improvements upon successful implementation as follows, as
the parties may elect in writing at the time of the relevant Work
Order's execution: (a) for any change initiated by eFunds resulting in
the savings or improved Services benefiting Deluxe, eFunds shall retain
fifty percent (50%) of the savings or value in improved Services for a
period of twelve (12) months, after which all further savings or
enhanced value shall be realized by Deluxe; and (b) for any change
initiated by Deluxe but as to which eFunds has substantially assisted,
either (i) Deluxe shall retain one hundred percent (100%) of the
savings or enhanced value and eFunds will be compensated directly
through Fees for its implementation Services or (ii) eFunds shall
retain thirty-five percent (35%) of the savings or enhanced value for a
period of twelve (12) months, after which all further savings or
enhanced value shall be realized by Deluxe.
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6.0 DELUXE RESPONSIBILITIES
6.1 Deluxe Facilities.
Deluxe shall permit eFunds personnel to have reasonable access to
Deluxe's facilities and systems solely as needed to provide the
Services hereunder, subject to the following conditions: (a) eFunds
personnel shall obey all generally applicable rules and procedures at
such Deluxe facilities and as provided in the SOP, including, without
limitation, facility, data and computer security rules and procedures;
(b) eFunds shall not make any structural, mechanical or electrical
alterations to Deluxe's facilities without Deluxe's prior written
approval; and (c) when such space is no longer occupied by eFunds
personnel, eFunds shall return such space to Deluxe in substantially
the same conditions as when eFunds began use of such space, reasonable
wear and tear excepted. All such Deluxe facilites shall be reasonably
safe and sanitary; shall have normal and customary utilities and office
support services suitable for an IT office environment; shall have
normal and adequate office furniture and cubicles; and shall be subject
to janitorial service furnished by Deluxe. Except as otherwise
specified by Deluxe, in any such Deluxe facility, eFunds personnel
shall observe Deluxe's normal working hours and holiday schedule as
reasonably required by Deluxe. eFunds personnel shall display any
identification cards furnished by Deluxe or otherwise establish their
identity to the reasonable satisfaction of Deluxe security personnel as
a condition to access to such Deluxe facilities.
6.2 Deluxe Personnel and Equipment.
Deluxe shall make reasonably available to eFunds and on a timely basis
the Deluxe personnel, computer or other office equipment, products and
other items, if any, as specified in any applicable Statement of Work
or Work Order. Subject to Deluxe's prior written approval, eFunds may
use such Deluxe equipment (including software) away from Deluxe's
facilities to perform the Services. In such event, eFunds shall:
a. exercise at least reasonable care in the equipment's use
and storage;
b. use such equipment solely for the performance of the
Services and not for any other account or customer of eFunds;
c. upon the end of the Term, or at such earlier time as
Deluxe shall demand, return the equipment to Deluxe in as good order
and condition as when eFunds received same, reasonable wear and tear
excepted;
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d. not surrender possession of the equipment or permit the
use of the equipment by anyone other than eFunds without Deluxe's prior
written approval;
e. not permit any lien or encumbrance to be levied upon the
equipment; and
f. assume all risk of loss or damage of the equipment during
the time that it is in eFund's possession and control, and, as between
the parties, Deluxe shall at all times retain title to such equipment.
6.3 Third Party Consents.
Using reasonable efforts and subject to the right any third party to
give or withhold consent, Deluxe shall obtain any third party consents,
if any, that are necessary for eFunds to access and use any third party
software or hardware identified in a Statement of Work or Work Order as
reasonably needed for eFunds to perform the Services. eFunds shall
reasonably cooperate with Deluxe in obtaining such consents. Deluxe
shall remain solely liable to pay, and shall pay, any reasonable and
applicable license, transfer or access fees to enable eFunds to access
and use such third party software or hardware. If and to the extent
that Deluxe, together with eFunds' reasonable cooperation, is unable to
obtain any such third party consent, eFunds shall be excused from
performance of the Services requiring such third party consent until
such time as a reasonable alternative is secured and approved by
Deluxe.
6.4 Back-ups.
Deluxe shall maintain its own back-up or duplicate copies of any Deluxe
Data, Deluxe Software or Third Party Software (as defined in Article
9.0) furnished to eFunds for performance of the Services and shall not
transfer such materials to eFunds unless and until it has made such
back-up or duplicate copies. In addition, upon receipt thereof, eFunds
shall also make appropriate back-up or duplicate copies of such
materials prior to any other use or processing thereof. In
circumstances in which eFunds provides processing or similar Services,
eFunds shall at all times observe professional standards with respect
to back-up of Deluxe Data, Deluxe Software or Third Party Software used
in or produced as a result of such Services.
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7.0 PERFORMANCE STANDARDS
7.1 Service Level Requirements and Measurement.
All Services shall comply with the applicable performance standards set
forth in each Statement of Work and Work Order. eFunds shall use all
reasonably necessary measurements and monitoring tools and procedures
required to measure and report eFunds' performance of the Services
against the applicable performance standards. Such measurements and
monitoring shall permit reporting at a level of detail sufficient to
verify compliance with such performance standards and shall be subject
to audit by Deluxe. Each party shall also provide the other party and
its auditors with information and access to its respective tools and
procedures upon a reasonable request for purposes of verification. Such
measurements and monitoring (a) may be used by Deluxe to observe and
assess the performance by eFunds of its obligations under the Contract
Documents and (b) shall be used to allocate the bonuses and credits, if
any, specified in any applicable Statement of Work or Work Order under
Section 5.2.
7.2 User Satisfaction Surveys.
eFunds and Deluxe shall develop jointly a Deluxe user satisfaction
survey. Within ninety (90) days after the Effective Date, eFunds shall
commence such user satisfaction interviews, provide a report to
identify any part of the Services that needs to be improved, and
subsequently to follow up on any user concerns. Upon Deluxe's request,
Deluxe may examine the original interview user score sheets,
questionnaires or other survey materials upon which any such eFunds
report is based. eFunds shall repeat such user satisfaction surveys at
least once per calendar year during the Term and more often as Deluxe
may reasonably request, based on the prior surveys' results. Deluxe may
consider such survey results in evaluating eFunds' performance of its
obligations under the Contract Documents and qualifications to be
awarded additional business. eFunds covenants that measured Deluxe user
satisfaction in such surveys shall be a material performance criterion
for eFunds' compensation of its management.
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Professional Services Agreement
8.0 AUDITS
8.1 Service Level Audit.
At any time during the Term (but not more than once per calendar year)
and at its own expense, Deluxe may engage its internal audit staff or a
third party generally in the business of performing audits of IT
services (a "Service Level Auditor") to perform a review and audit of
eFunds' performance and reporting of the Services in relation to the
required service levels in applicable Statements of Work and Work
Orders (a "Service Level Audit"); provided that the Service Level
Auditor may not be a company or a division of a company that provides
IT outsourcing services ("IT Competitor"), unless eFunds consents
thereto in its sole discretion. The Service Level Auditor shall prepare
and submit to Deluxe a written report of the results of the Service
Level Audit (a "Service Level Audit Report"). Deluxe shall deliver to
eFunds a copy of the Service Level Audit Report within ten (10) days of
Deluxe's receipt thereof. Any dispute or issue related to a Service
Level Audit shall be resolved in accordance with the procedures set
forth in Article 15.0. The Service Level Auditor shall comply with all
reasonable confidentiality, non-solicitation and security requirements
that eFunds may reasonably impose but such auditor may nonetheless
request, copy and examine any books or records which Deluxe itself
could request, copy and examine under this Agreement.
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8.2 Fee Audit.
At any time during the Term (but not more than once per calendar year)
and at its own expense, Deluxe may engage its internal audit staff or
an independent third party (a "Fee Auditor") to perform a review and
audit of all records and reports relating to any of the Fees or
Reimbursable Expenses billed to Deluxe by eFunds pursuant to this
Agreement (a "Fee Audit") covering the then-current or the previous
calendar year; provided, however, that any records and reports relating
to costs incurred by eFunds shall not be subject to review or audit in
any Fee Audit except to the extent that such records or reports relate
to pass-through Reimbursable Expenses, and, further provided, such Fee
Auditor may not be an IT Competitor, unless eFunds consents thereto in
its sole discretion. The Fee Auditor shall prepare and submit to Deluxe
a written report of the results of the Fee Audit (a "Fee Audit
Report"). Deluxe shall provide eFunds with a copy of the Fee Audit
Report within thirty (30) business days of Deluxe's receipt thereof. In
the event that the Fee Audit Report reveals that any Fees or
Reimbursable Expenses have been overbilled, eFunds shall (a) reimburse
Deluxe such sum with interest from the date upon which such sum was
first paid by Deluxe (the "Payment Date") until the date on which
eFunds makes such reimbursement, at the Prime Rate plus one percent
(1%) on the Payment Date (or the next prior date on which the Wall
Street Journal was published if not published on the Payment Date), and
(2) if the overbilled Fees or Reimbursable Expenses exceed by more than
five percent (5%) the amount which the Fee Auditor determines to have
been proper, pay the reasonable fees, costs and expenses incurred by
Deluxe in connection with the Fee Audit. Any dispute or issue related
to a Fee Audit shall be resolved in accordance with the procedures set
forth in Article 15.0. The Fee Auditor shall comply with all reasonable
confidentiality, non-solicitation and security requirements that eFunds
may reasonably impose but such auditor may nonetheless request, copy
and examine any books or records which Deluxe itself could request,
copy and examine under this Agreement.
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8.3 Service Audit.
At any time during the Term and at its own expense, Deluxe may engage
its internal audit staff or an independent third party (a "Service
Auditor") to perform a review and audit ("Service Audit") of the
Services, including, without limitation, (i) the parts of any Deluxe
facility at which eFunds is providing such Services, (ii) eFunds
personnel providing such Services, (iii) data and records relating to
such Services to verify the integrity, security and privacy of Deluxe
Data and to examine the eFunds systems that process, store, support and
transmit such data, and (iv) the provision of any Key Deliverables,
provided, such Service Auditor may not be an IT Competitor, unless
eFunds consents thereto in its sole discretion. The Service Auditor may
examine eFunds' data practices and procedures, management systems,
general controls and security practices and procedures, disaster
recovery and backup procedures, incident or investigative records and
any other aspects of such Services reasonably related to Deluxe. The
Service Auditor shall prepare and submit to Deluxe a written report of
the results of the Service Audit (a "Service Audit Report"). Deluxe
shall provide eFunds with a copy of the Service Audit Report within
thirty (30) business days of Deluxe's receipt thereof. Any dispute or
issue related to a Service Audit shall be resolved in accordance with
the procedures set forth in Article 15.0. The Service Auditor shall
comply with all reasonable confidentiality, non-solicitation and
security requirements that eFunds may reasonably impose but such
auditor may nonetheless request, copy and examine any books or records
which Deluxe itself could request, copy and examine under this
Agreement.
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8.4 Benchmark Audit.
At any time after the first anniversary of the Effective Date (but not
more than once per calendar year) and at its own expense, Deluxe may
engage its internal audit staff or a third party generally in the
business of performing audits of IT services (a "Benchmark Auditor") to
perform a review and audit of eFunds' performance under any specific
Statement of Work or for any Work Order (a "Benchmark Audit"); provided
that such Benchmark Auditor may not be an IT Competitor, unless eFunds
consents thereto in its sole discretion. A Benchmark Audit shall
measure eFunds' performance against other nationally or internationally
recognized outsourcing services providers that regularly provide the
full range of Services provided by eFunds to Deluxe under this
Agreement and on similar outsourcing engagements of those providers for
substantially similar services in substantially similar quantities and
shall consider productivity and resource cost changes. The Benchmark
Auditor shall prepare and submit to Deluxe a written report of the
results of the Benchmark Audit (a "Benchmark Audit Report"). Deluxe
shall deliver to eFunds a copy of the Benchmark Audit Report within ten
(10) days of Deluxe's receipt thereof. Any dispute or issue related to
a Benchmark Audit shall be resolved in accordance with the procedures
set forth in Article 15.0. The Benchmark Auditor shall comply with all
reasonable confidentiality, non-solicitation and security requirements
that eFunds may reasonably impose but such auditor may nonetheless
request, copy and examine any books or records which Deluxe itself
could request, copy and examine under this Agreement.
8.5 eFunds Internal or External Audits.
During the Term, eFunds shall conduct its own internal or external
audits required to test the adequacy of eFunds' internal control
environments. Such audits may include but shall not be limited to
audits in accordance with the American Institute of Certified Public
Accountants ("AICPA") Statement on Auditing Standards Number 70,
"Reports on the Processing Transactions by Service Organizations", as
the AICPA may amend the same from time to time ("SAS 70"). In addition,
eFunds may substitute, at its own expense, an SAS 70 audit performed by
an independent "Big 5" accounting firm for any applicable audit under
Sections 8.1 - 8.4 above if Deluxe agrees to such substitution.
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8.6 Cooperation with Audits; Follow-Up.
eFunds shall cooperate with any audit conducted by Deluxe pursuant to
this Article 8.0 without cost to Deluxe, except eFunds' normally
billable resources or as otherwise set forth in the Contract Documents.
The results and reports of each audit under this Article 8.0 shall be
submitted to the Deluxe Relationship Manager and the eFunds Account
Manager and, if appropriate, to the Management Committee and to the
Executive Committee for their review and consideration. If any audit
report indicates that eFunds' performance of the Services is not
materially unsatisfactory but could nonetheless be improved in specific
ways, the Deluxe Relationship Manager and the eFunds Account Manager
shall implement such recommendations as soon as commercially feasible.
If any audit report indicates that eFunds' performance of the Services
is materially unsatisfactory in any respect, eFunds shall submit to
Deluxe within thirty (30) days of its receipt of the relevant audit
report a plan to improve eFunds' performance to the level deemed
acceptable by such audit. Upon review and approval of such plan by the
Deluxe Relationship Manager and eFunds Account Manager, Management
Committee or Executive Committees, as appropriate, eFunds shall
implement such plan within the agreed-upon time frame.
8.7 Books and Records.
eFunds shall maintain all normal and customary books and records
("Books and Records") to document its performance of the Services and
to justify all Fees and Reimbursable Expenses that are invoiced to
Deluxe hereunder. At Deluxe's request, eFunds shall deliver to Deluxe
or its auditors one copy of such Books and Records in an electronic
format approved by Deluxe, provided that such electronic copies are
reasonably available to eFunds. eFunds shall maintain any such Books
and Records not delivered to Deluxe or demanded by Deluxe for at least
three (3) years after the final payment made in connection with this
Agreement. Notwithstanding any other provision herein, eFunds may not
dispose of any material Books and Records following the expiration of
such three-year period without written notification to and written
approval from Deluxe. eFunds shall assist Deluxe in meeting Deluxe's
legal obligations with respect to the retention of any Books and
Records in eFunds' possession or control, and Deluxe shall reimburse
eFunds for the reasonable costs incurred by eFunds while providing such
assistance or storage.
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9.0 OWNERSHIP AND LICENSES
9.1 Deluxe Data and Databases.
From time to time, Deluxe, its Affiliates and their customers,
suppliers or licensers may provide to eFunds certain of their
respective data or databases or eFunds may create such data or
databases for those parties as a result of the Services hereunder
(regardless of the media on which such data or databases are stored or
transmitted) (collectively, "Deluxe Data"). Deluxe, its Affiliates and
their customers, suppliers or licensers shall own all right, title and
interest in and to the Deluxe Data, and eFunds hereby releases,
transfers and assigns to such respective owners of the Deluxe Data all
of eFunds' right, title and interest (including without limitation all
present and future copyrights or database rights under the European
Copyright Directive or Database Directive or other similar legislation
in any other jurisdictions), if any, in and to such Deluxe Data. Deluxe
hereby grants to eFunds a worldwide, royalty-free, non-exclusive,
non-transferable, limited right and license during the Term to use,
copy, maintain, modify, enhance, and create derivative works of such
Deluxe Data solely as necessary for the provision of the Services
pursuant to this Agreement. Such authorization includes, without
limitation, storage, processing and transmission of the Deluxe Data for
Deluxe; maintenance, development, and modification of derivative works
as authorized by the Contract Documents; and the duplication of the
Deluxe Data for operational, developmental, and archival purposes. The
foregoing license does not give eFunds the right, and eFunds is not
authorized, to sublicense such Deluxe Data. At any time during the
Term, Deluxe may receive one or more copies of any or all such Deluxe
Data from eFunds upon Deluxe's written request, provided in or on such
media and transmitted by such means as Deluxe may reasonably specify.
Except as otherwise requested or approved by Deluxe, eFunds shall cease
all use of the Deluxe Data upon expiration or termination of this
Agreement, and shall immediately return or destroy the same at Deluxe's
direction.
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9.2 Deluxe Software.
From time to time, Deluxe, its Affiliates and their customers,
suppliers or licensers may provide to eFunds certain of their
respective software or eFunds may develop such software for those
parties as a result of the Services hereunder (regardless of the media
on which such software is stored or transmitted) (collectively, "Deluxe
Software"). Deluxe, its Affiliates and their customers, suppliers or
licensers shall own all right, title and interest in and to the Deluxe
Software, and eFunds hereby releases, transfers and assigns to such
respective owners of the Deluxe Software all of eFunds' right, title
and interest (including without limitation all present and future
copyrights or database rights under the European Union directives or
regulations or other similar legislation in any other jurisdictions),
if any, in and to such Deluxe Software. Deluxe hereby grants to eFunds
a worldwide, royalty-free, non-exclusive, non-transferable, limited
right and license during the Term to use, copy, maintain, modify,
enhance, and create derivative works of such Deluxe Software solely as
necessary for the provision of the Services pursuant to this Agreement.
Such authorization includes, without limitation, operation of the
Deluxe Software for Deluxe; maintenance, development, and modification
of derivative works as authorized by the Contract Documents; and the
duplication of the Deluxe Software for operational, developmental, and
archival purposes. The foregoing license does not give eFunds the
right, and eFunds is not authorized, to sublicense such Deluxe
Software. Except as otherwise requested or approved by Deluxe, eFunds
shall cease all use of the Deluxe Software upon expiration or
termination of this Agreement, and shall immediately return or destroy
the same at Deluxe's direction.
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9.3 Third Party Software.
If and to the extent that Deluxe or its Affiliates reasonably requires
eFunds to access or use any third party software ("Third Party
Software") to perform the Services under any Contract Document, and,
subject to Deluxe's compliance with Section 6.3, if applicable, Deluxe
hereby grants to eFunds a worldwide, royalty-free, non-exclusive,
non-transferable, limited right and sublicense or other right to use
during the Term to use, copy, maintain, modify, enhance, and create
derivative works of such Third Party Software solely as necessary for
the provision of the Services pursuant to this Agreement. Such
authorization includes, without limitation, operation of the Third
Party Software for Deluxe; maintenance, development, and modification
of derivative works as authorized by the Contract Documents; and the
duplication of the Third Party Software for operational, developmental,
and archival purposes. The foregoing sublicense does not give eFunds
the right, and eFunds is not authorized, to further sublicense such
Third Party Software. Except as otherwise requested or approved by
Deluxe, eFunds shall cease all use of the Third Party Software upon
expiration or termination of this Agreement, and shall immediately
return or destroy the same at Deluxe's direction.
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9.4 eFunds Materials.
If and to the extent that Deluxe or its Affiliates reasonably requires
access to or use of any preexisting or later developed eFunds data,
databases or software (collectively, "eFunds Materials") to enjoy the
benefits of the Services under any Contract Document or if any such
eFunds Materials are incorporated by eFunds in any Key Deliverables,
eFunds hereby grants to Deluxe and its Affiliates a worldwide,
royalty-free, non-exclusive, transferable, perpetual license to use,
copy, maintain, modify, enhance, and create derivative works of such
eFunds Materials solely for their internal use as herein provided or
otherwise authorized under the Contract Documents. Such authorization
includes, without limitation, operation of the eFunds Materials by or
for Deluxe; maintenance, development, and modification of derivative
works for solely for the benefit of Deluxe or its Affiliates and their
successors and assigns but not for any other parties or otherwise as
authorized by the Contract Documents; and the duplication of the eFunds
Materials for reasonable operational, developmental, and archival
purposes. The foregoing sublicense includes the right, and Deluxe and
its Affiliates are hereby authorized, to sublicense such eFunds
Materials to any other IT or other business process services
outsourcing provider serving Deluxe or its Affiliates, provided, such
sublicense may only be for the benefit of Deluxe and Affiliates and
their successors and assigns but not for any other parties unless
further sublicensing is authorized by the Contract Documents. Deluxe
and its Affiliates and their successors and assigns may continue their
use of and access to such eFunds Materials under this Section 9.4 upon
expiration or termination of this Agreement.
9.5 Key Deliverables.
Unless otherwise specified in any Statement of Work or Work Order,
eFunds shall deliver to Deluxe source and any other reasonably
necessary documentation or components for any Key Deliverables to
enable Deluxe to use, service and repair such materials with its own
internal IT resources or with another IT and business process
outsourcing services provider.
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9.6 Inventions.
During the Term, either of the parties or the parties jointly may
conceive of an enhancement, improvement or invention (collectively,
"Invention") which may be capable of protection under the copyright or
patent laws of the United States of America, India or another country.
In such event, Deluxe shall be the sole and exclusive owner of any
Invention, whether made by eFunds alone, by Deluxe alone or by eFunds
and Deluxe jointly. eFunds hereby assigns all right, title and interest
it has or may have in and to any such Invention under the laws of any
nation, including, without limitation, the laws of the United States
and India. Deluxe shall solely determine the manner and means for
patent or other intellectual property protection for such Invention,
shall select and control the patent counsel to seek such protection,
shall be responsible for the enforcement of any such patents obtained
and shall retain the proceeds from any such enforcement. If and only to
the extent reasonably necessary to perform the Services during the
Term, Deluxe shall be deemed to have granted to eFunds a limited,
worldwide, royalty-free and non-transferable license to use and
practice any Invention for the benefit of Deluxe under the Contract
Documents. Notwithstanding this Section 9.6, eFunds grants no rights to
Deluxe, and Deluxe acquires no rights from eFunds, as to any other
intellectual property of eFunds that are outside the scope of the
Services and that are not incorporated into any deliverables under the
Contract Documents.
10.0 CONFIDENTIALITY
10.1 Deluxe and eFunds Responsibilities.
All Confidential Information shall be deemed confidential and
proprietary to the party disclosing such information hereunder. Each
party may use the Confidential Information of the other party during
the Term only as permitted or required for the receiving party's
performance hereunder. The receiving party shall not disclose or
provide any Confidential Information to any third party and shall take
reasonable measures (including, without limitation, the use of
nondisclosure agreements consistent with and not less restrictive than
this Article 10.0) to prevent any unauthorized disclosure by its
employees, agents, contractors or consultants. The foregoing duty shall
survive any termination or expiration of this Agreement for a period of
ten (10) years from the effective date of such termination or
expiration. Notwithstanding the foregoing, with respect to any Deluxe
Data of any kind, the foregoing duty shall be perpetual.
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10.2 Exceptions.
Notwithstanding Section 10.1, the following information shall not be
deemed Confidential Information for purposes of this Article 10:
a. information required to be disclosed in public under a
subpoena, request for documents, or other validly issued judicial or
administrative process, provided that the party so required promptly
notifies the other party of the receipt of process and permits the
other party a reasonable opportunity to respond to such process (and,
if the other party secures a protective order, such information shall
remain Confidential Information to the extent therein specified);
b. information which is or becomes generally available to
the public other than as a result of any unauthorized disclosure by the
receiving party;
c. information available to the receiving party from a third
party who received such information on a non-confidential basis and
without obligation to the disclosing party;
d. information already known to the receiving party prior to
its disclosure by the other party;
e. information independently developed by the receiving
party without any use of or reliance on the disclosing party's
Confidential Information; or
f. information as the parties may mutually agree in writing
can be disclosed publicly.
11.0 WARRANTIES AND COVENANTS
11.1 Deluxe Warranties to eFunds.
Deluxe hereby warrants to eFunds that;
a. the execution and delivery of this Agreement by Deluxe
has been duly authorized and performance by Deluxe hereunder shall not
result in the breach of any material term or provision of any charter,
bylaw or agreement to which Deluxe is a party or by which it is bound;
b. this Agreement constitutes a valid and binding agreement;
and
c. Deluxe owns or otherwise has the right to grant herein
the licenses or sublicenses or other rights of use for the Deluxe Data,
the Deluxe Software and the Third Party Software.
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11.2 EFUNDS Warranties to Deluxe.
eFunds hereby warrants to Deluxe that:
a. the execution and delivery of this Agreement by eFunds
has been duly authorized and performance by eFunds hereunder shall not
result in the breach of any material term or provision of any charter,
bylaw or agreement to which eFunds is a party or by which it is bound;
b. this Agreement constitutes a valid and binding agreement;
c. eFunds owns or otherwise has the right to grant the
licenses or sublicenses herein for the eFunds Materials;
d. all Services rendered hereunder shall be performed in a
professional, workmanlike manner in accordance with the applicable
Contract Documents;
e. all Key Deliverables and other items provided as a result
of the Services shall materially conform with the applicable Contract
Documents;
f. all Software Deliverables shall be free of any virus or
other surreptitious code and of any disabling or shut down code or
features;
g. all Software Deliverables shall be "Year 2000 Compliant"
as defined in the coding standards referred to in Exhibit B hereto; and
h. the performances of the Services and all Key Deliverables
and other items provided as a result of the Services shall not infringe
the intellectual property rights (including, without limitation, any
patents, copyrights, trademarks or trade secrets) of any third party
anywhere in the world.
11.3 Deluxe's Remedies.
Deluxe shall give reasonable written notice to eFunds of any Services,
Key Deliverables or other items provided as the result of or related to
the sufficiency of the Services which Deluxe believes to be deficient,
defective or non-conforming to the foregoing warranties in Section
11.2. In such case, the parties shall have the following duties and
rights, respectively:
a. eFunds' sole initial obligation and Deluxe's sole initial
remedy hereunder shall be for eFunds to remedy such deficiency, defect
or non-conformity within a reasonable time at no charge to Deluxe;
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b. if eFunds is unable to remedy such deficiency, defect or
non-conformity within a reasonable time period, then Deluxe's exclusive
final remedy and eFunds' entire liability for Direct Damages (as
defined in Article 14.0) in contract, tort or otherwise shall be a
refund of the amount paid hereunder as Fees or Reimbursable Expenses
for the deficient, defective or non-conforming Services or
deliverables; and
c. notwithstanding clauses (a) or (b) above, if and to the extent
that there are any Consequential or Incidental Damages (as defined in
Article 14.0) in such case, then Deluxe's exclusive final remedy and
eFunds' entire liability for such Consequential or Incidental Damages
shall be the payment of same to Deluxe by eFunds, subject to the
applicable limitation established in Section 14.1.
11.4 Warranty Disclaimer.
THE LIMITED EXPRESS WARRANTIES OF THE PARTIES SET FORTH RESPECTIVELY IN
SECTION 11.1 AND 11.2 ARE IN LIEU OF ALL OTHER WARRANTIES BY EITHER
PARTY, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
11.5 Certain Covenants.
eFunds shall obtain all applicable permits and licenses in any such
jurisdiction generally applicable to entities in the IT services
business as required in connection with its obligations hereunder.
eFunds shall comply in all material respects with any applicable
federal, state and local laws and regulations in the United States of
America, India or any other jurisdiction where it may operate and
perform the Services hereunder. Without limiting the foregoing, if and
to the extent that any U.S. or other national export licenses may be
required for the export of any software or other materials or equipment
hereunder or for eFunds to perform the Services, the exporting party
shall obtain such licenses and shall otherwise comply with such
applicable export control laws and regulations. eFunds shall pay its
subcontractors all sums due and owning to such entities in accordance
with the terms of its agreements with such subcontractors.
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12.0 INDEMNITIES
12.1 Indemnity by eFunds.
eFunds shall indemnify, hold harmless and defend Deluxe and its
Affiliates and their respective directors, officers, agents and
employees from and against any loss, costs (including reasonable
attorney's fees) damages, injury, liability, claims, demands, or causes
of action arising out of or resulting from the Services for:
a. personal injury or death;
b. any material and uncured breach of eFunds' warranties in
Section 11.2, subject to the limitation in Section 11.3;
c. property damage;
d. claims of infringement of any third party's proprietary,
privacy or other rights, including, but not limited to, patent,
copyrights, trademarks, or trade secret (collectively, "Third Party
Right");
e. any act or omission of eFunds as an employer; or
f. any debt or other duty of any kind or amount owed to an
eFunds subcontractor
except and to the extent such loss, cost, damage, injury, liability,
claim, demand or action is due to Deluxe's negligence or misconduct.
If the use of any Key Deliverable or other item or Service delivered or
provided by eFunds hereunder is found to infringe or misappropriate a
Third Party Right, eFunds shall, at its own option and expense, replace
the infringing or misappropriated materials or Services with a
substitute free of the infringement or misappropriation, or shall
procure for Deluxe's benefit a license or other right to use the same;
or shall remove the enjoined materials or Services and reimburse Deluxe
for all amounts paid or expenses incurred with respect thereto.
Notwithstanding the foregoing, eFunds shall have no obligation or
liability under this Section 12.1 to the extent any claim(s) is based
solely upon any changes or modifications made independently by Deluxe
to such materials or arising from specifications or design requirements
required by Deluxe as contained in any applicable Work Order.
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12.2 Indemnity by Deluxe.
Deluxe shall indemnify, hold harmless and defend eFunds and its
Affiliates and their respective directors, officers, agents and
employees from and against any loss, costs (including reasonable
attorney's fees) damages, injury, liability, claims, demands, or causes
of action arising out of or resulting from its performance under this
Agreement for:
a. personal injury or death;
b. any material and uncured breach of Deluxe's warranties in
Section 11.1;
c. property damage;
d. claims of infringement of any Third Party Right;
e. any act or omission of Deluxe as an employer; or
f. any debt or other duty of any kind or amount owed to any
other Deluxe vendor or supplier,
except and to the extent such loss, cost, damage, injury, liability,
claim, demand or action is due to eFunds' negligence or misconduct.
If the use of any Deluxe Data, Deluxe Software or Third Party Software
delivered or provided by Deluxe hereunder is found to infringe or
misappropriate a Third Party Right, Deluxe shall, at its own option and
expense, replace the infringing or misappropriated materials with a
substitute free of the infringement or misappropriation, or shall
procure for eFunds' benefit a license or other right to use the same;
or shall remove the enjoined materials and reimburse eFunds for all
amounts paid or expenses incurred with respect thereto. Notwithstanding
the foregoing, Deluxe shall have no obligation or liability under this
Section 12.2 to the extent any claim(s) is based solely upon any
changes or modifications made independently by eFunds to such
materials.
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12.3 Indemnification Procedures.
With respect to any third party claims for which a party seeks
indemnification under this Article 12.0, the indemnification procedures
set forth in Section 7.01(d)-(f) of the IPO and Distribution Agreement
between eFunds and Deluxe Corporation dated as of March 31, 2000 shall
apply, and are hereby incorporated herein and made a part hereof for
all purposes as if fully set forth herein. With respect to any claims
for indemnification which do not involve a claim by a third party, the
procedures set forth in Article 15.0 hereof shall govern the parties,
rights and obligations with respect thereto.
13.0 TERM AND TERMINATION
13.1 Term.
This Agreement shall commence as of the Effective Date and shall expire
on the fifth (5th) anniversary of that date unless sooner terminated as
provided in this Article 13.0. Thereafter, this Agreement shall
automatically be renewed for successive one (1) year periods, unless a
party provides the other party with written notice at least one
hundred-eighty (180) days prior to the next scheduled renewal date
stating that it does not wish for this Agreement to be renewed. If this
Agreement expires or is otherwise terminated under this Article 13.0,
its terms and conditions shall continue to apply to any Statements of
Work and Work Orders then in effect until such Statements of Work or
Work Orders expire or are terminated.
13.2 Termination of a Statement of Work or Work Order for Cause.
If there is a material breach of any Statement of Work or Work Order,
the non-breaching party shall give written notice thereof to the
breaching party. If the breaching party does not, within thirty (30)
calendar days after receiving such written notice, either (a) cure the
material failure or (b) if the breach is not one that can reasonably be
cured within thirty (30) days, develop a mutually agreed to plan to
cure the failure and diligently proceed according to the plan until the
material failure has been cured, then the non-breaching party may
terminate the affected Statement of Work or Work Order, in whole or in
part, for cause by written notice to the breaching party. Prior to
giving notice of termination of a Statement of Work or Work Order for
cause, the purported breaching party shall be afforded an opportunity
to meet with a senior management representative of the non-breaching
party to explain its position.
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13.3 Termination of Agreement for Cause.
If there is a material breach of this Agreement, including, without
limitation, due to repeated or chronic breaches of individual
Statements of Work or Work Orders, the non-breaching party shall give
written notice thereof to the breaching party. If the breaching party
does not, within thirty (30) calendar days after receiving such written
notice, either (a) cure the material failure or (b) if the breach is
not one that can reasonably be cured within thirty (30) days, develop a
mutually agreed to plan to cure the failure and diligently proceed
according to the plan until the material failure has been cured, then
the non-breaching party may terminate this Agreement for cause by
written notice to the breaching party. Prior to giving notice of
termination of this Agreement for cause, the purported breaching party
shall be afforded an opportunity to meet with a senior management
representative of the non-breaching party to explain its position.
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13.4 Termination For eFunds' Change of Control.
If control of eFunds is to be acquired, directly or indirectly, in a
single transaction or series of related transactions, or all or
substantially all of the assets or business of eFunds are to be
acquired by any organization that is not affiliated with eFunds, then,
within five (5) days of eFunds' execution of any letter fo intent,
memorandum of understanding or similar document or, in the absence of
same, upon eFunds' execution of a definitive transaction agreement,
eFunds shall give written notice thereof to Deluxe in confidence with
sufficient detail about the proposed transaction and the proposed
acquiring party to enable Deluxe to determine if continuation of this
Agreement would be in Deluxe's best interest. If control of any
Affiliate of eFunds providing Services under a specific Statement of
Work or Work Order is to be acquired, directly or indirectly, in a
single transaction or series of related transactions, or all or
substantially all of the assets or business of such Affiliate of eFunds
are to be acquired by any organization that is not affiliated with
eFunds, then, within five (5) days of eFunds' execution of any letter
of intent, memorandum of understanding or similar document or, in the
absence of same, upon eFunds' execution of a definitive transaction
agreement, eFunds shall give written notice thereof to Deluxe in
confidence with sufficient detail about the proposed transaction and
the proposed acquiring party to enable Deluxe to determine if
continuation of such Statement of Work or Work Order by such Affiliate
of eFunds would be in Deluxe's best interest. In either case, Deluxe
shall have fifteen (15) days from the receipt of such notice to make
such determination and, upon written notice to eFunds given within such
15-day period, may terminate this Agreement or such Statement of Work
or Work Order, as applicable, upon consummation of the transaction
decribed in the aforesaid notice, provided such termination notice
shall designate an actual termination date that is not less than three
(3) months nor more than twelve (12) months after the date of such
termination notice and, provided further, the parties shall pay each
other all sums owed as specified in open Work Orders, net of all
outstanding rebates, compensatory payments, bonuses or credits. If
Deluxe does not give such termination notice within such 15-day period
or does not respond to such eFunds' notice of the proposed transaction,
Deluxe shall be deemed to have consented to the transaction described
therein and Deluxe shall have no further termination rights as to this
Agreement or such Statement Work or Work Order, as the case may be,
under this Section 13.4. In any event, upon the occurrence of any such
acquisition transaction, Deluxe may direct eFunds to implement
additional and commercially reasonable security measures to prevent the
disclosure of any Deluxe Confidential Information to the acquiring
entity.
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13.5 Termination Through Insolvency
Either party may immediately terminate this Agreement upon written
notice in the event that (a) the other party becomes insolvent, enters
into receivership, is the subject of a voluntary or involuntary
bankruptcy proceeding, or makes an assignment for the benefit of
creditors; or (b) a substantial part of the other party's property is
or becomes subject to any levy, seizure, assignment or sale for or by
any creditor or governmental agency. If a party's Affiliate is bound
under the terms of any Statement of Work or Work Order, the other party
may immediately terminate such Statement of Work or Work Order upon
written notice in the event that (a) such Affiliate becomes insolvent,
enters into receivership, is the subject of a voluntary or involuntary
bankruptcy proceeding, or makes an assignment for the benefit of
creditors; or (b) a substantial part of such Affiliate's property is or
becomes subject to any levy, seizure, assignment or sale for or by any
creditor or governmental agency, provided, however, such termination
may not occur if such Affiliate's performance thereunder is guaranteed
or otherwise covered by the party (eFunds or Deluxe) responsible for
such Affiliate. Notwithstanding the foregoing, as reasonably required
for Deluxe to enjoy the benefits of the Services under the Contract
Documents, any licenses of Deluxe Data, Deluxe Software or Third Party
Software from Deluxe to eFunds or any licenses of eFunds Materials to
Deluxe hereunder shall be deemed within the meaning of Section 365(n)
of the U.S. Bankruptcy Code and shall remain in full force and effect
in such event.
13.6 Termination Assistance.
If this Agreement is to expire or be terminated in accordance with this
Article 13.0, the parties shall do the following for the resulting
transition of the Services:
a. eFunds shall continue to perform the Services then being
performed by eFunds;
b. eFunds shall develop, with the assistance of Deluxe or
its designee, a plan for the transition of the Services from eFunds to
Deluxe or its designee;
c. eFunds shall provide training for personnel of Deluxe or
its designee in the performance of the Services then being transitioned
to Deluxe;
d. if Deluxe has terminated eFunds under Section 13.2, 13.3,
13.4 or 13.5, eFunds shall waive, and hereby does waive, Section 4.8
and eFunds's contractual right, if any, under any employment agreement
to prohibit (i) any eFunds employee engaged principally in performing
the Services from accepting
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an offer of employment from Deluxe or its designee or (ii) any eFunds
subcontractor or consultant performing any portion of the Services from
entering into a contractual relationship with Deluxe or its designee.
In addition, eFunds shall allow Deluxe reasonable access to such
personnel for interviews and recruitment;
e. eFunds shall use reasonable commercial efforts to grant,
subject to reasonable terms and conditions, or to assist Deluxe or its
designee to obtain, a sublicense or other right to use any software
owned or licensed by eFunds that is primarily then used by eFunds to
perform the Services. In addition, eFunds shall use reasonable
commercial efforts to provide Deluxe or its designee with appropriate
interface information for software that is not commercially available,
provided that eFunds has or can reasonably obtain the necessary rights,
and further provided that Deluxe reimburses eFunds for any reasonable
costs that it incurs in connection with obtaining such rights,
provided, however, if Deluxe has terminated eFunds under Section 13.2,
13.3, 13.4 or 13.5, Deluxe may recover such fees as Consequential or
Incidental Damages hereunder;
f. eFunds shall make available to Deluxe or its designee,
pursuant to reasonable terms and conditions of purchase, any hardware
owned or leased by eFunds that is substantially dedicated to the
performance of the Services. If Deluxe or its designee elects to
purchase any such hardware, the purchase price for any such hardware
owned by eFunds shall be eFunds's then-current book value and, if
Deluxe or its designee elects to assume any lease, subject to the terms
of the applicable lease, Deluxe or its designee may assume eFunds's
rights and obligations with respect to any such hardware leased by
eFunds, provided, however, if Deluxe has terminated eFunds under
Section 13.2, 13.3, 13.4 or 13.5, Deluxe may recover such payments as
Consequential or Incidental Damages hereunder;
g. eFunds shall use reasonable commercial efforts to assist
Deluxe or its designee to obtain (on a non-exclusive basis) the
continuation of any third party services then being used by eFunds in
the performance of the Services that Deluxe desires to continue;
h. To the extent any part of Deluxe's data or communications
network services are being provided by eFunds using a proprietary
network, eFunds shall, at Deluxe's request, continue to provide such
network services to Deluxe, subject to reasonable terms and conditions,
for a period not to exceed one (1) year following the effective date of
expiration or termination, provided, however, if Deluxe has terminated
eFunds under Section 13.2, 13.3, 13.4 or 13.5, Deluxe
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may recover such payments as Consequential or Incidental Damages
hereunder; and
i. If prior to termination, eFunds has prepaid charges for a
license to use any licensed program, to the extent that Deluxe has the
benefit of such license and prepayment following termination, Deluxe
shall reimburse eFunds an appropriate portion of the prepaid charges,
provided, however, if Deluxe has terminated eFunds under Section 13.2,
13.3, 13.4 or 13.5, Deluxe may recover such payments as Consequential
or Incidental Damages hereunder.
eFunds shall provide the above-described termination assistance for the
Services until the effective date of expiration or termination of this
Agreement and, if commercially necessary, for up to ninety (90)
additional days after the effective date of expiration or termination.
If such termination assistance requires eFunds to incur expenses in
addition to the Fees or Reimbursable Expenses that eFunds would
otherwise incur in the performance of this Agreement, then eFunds shall
notify Deluxe of the nature and extent of such additional expenses and,
upon Deluxe's approval of same, eFunds shall proceed and invoice Deluxe
therefor. Deluxe shall pay eFunds for such additional expenses incurred
within thirty (30) days of the date of such invoice in accordance with
Article 5.0, provided, however, if Deluxe has terminated eFunds under
Section 13.2, 13.3, 13.4 or 13.5, Deluxe may recover such payments as
Consequential or Incidental Damages hereunder.
13.7 Survival.
Articles 5.0 (Compensation), 9.0 (Ownership and Licenses), 10.0
(Confidentiality), 11.0 (Warranties and Covenants), 12.0 (Indemnities),
13.0 (Term and Termination), 14.0 (Limitation of Liability), 15.0 (Law
and Disputes), 17.0 (General) and the applicable portions of Article
16.0 (Insurance) hereof shall survive any termination or expiration of
this Agreement.
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14.0 LIMITATION OF LIABILITY
14.1 Damage Limits.
For purposes of the Contract Documents, "Direct Damages" shall mean any
damages categorized as direct damages under the law of the State of
Minnesota and "Consequential or Incidental Damages" shall mean any loss
of anticipated revenues, income, profits or savings; loss of or damage
to business reputation or good will; loss of customers; loss of
business or financial opportunity; or any other indirect or special
damages of any kind categorized as consequential or incidental damages
under the law of the State of Minnesota which is a loss of a kind that
is insured (without application of any deductible amount) by eFunds'
errors and omissions insurance coverage as required under Section
16.2(e). There shall be no limit on Direct Damages arising out of or
resulting from the Services. There shall be a limit on Consequential or
Incidental Damages arising out of or resulting from the Services equal
to the then-applicable amount of errors and omission insurance coverage
(without the application of any deductible amount) required to be
carried by eFunds under Section 16.2(e), provided, however, that if the
amount of insurance available under such errors and omission insurance
policy is reduced by the amount of claims or payments made against such
insurance during any applicable insurance period, whether by or to
Deluxe or other claimants, the aforesaid limitation on Consequential
and Incidental Damages shall be reduced to equal the amount of
insurance then remaining and available to pay such damages.
14.2 Damage Waiver.
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY HEREUNDER
FOR ANY LOST PROFITS OR OTHER CONSEQUENTIAL, INCIDENTAL, INDIRECT,
SPECIAL OR OTHER SIMILAR DAMAGES, EVEN IF SUCH PARTY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES, IN EXCESS OF THE AMOUNTS SET FORTH
IN SECTION 14.1 AND IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE
OTHER FOR EXEMPLARY OR PUNITIVE DAMAGES. The limitations of liability
set forth in this Article14.0 shall survive and apply notwithstanding
the failure of any limited or exclusive remedy for breach of warranty
set forth in the Contract Documents.
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15.0 LAW AND DISPUTES
15.1 Governing Law.
The Contract Documents shall be governed by the laws of the State of
Minnesota, without regard to any provision of Minnesota law that would
require or permit the application of the substantive law of any other
jurisdiction.
15.2 Dispute Handling.
eFunds and Deluxe shall endeavor to resolve any dispute, whether
arising during the Term or at any time thereafter which involves the
validity, construction, meaning, performance, termination, expiration
or effect of this Agreement or any Contract Documents, or the rights or
liabilities of the parties, promptly and in an amicable and
professional manner by negotiations between the parties.
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15.3 Problem Escalation Procedures.
eFunds through its Account Manager and Deluxe through its Relationship
Manager may refer any dispute to the Management Committee. The
Management Committee shall then meet as soon as reasonable in light of
the nature and impact of the issue under consideration. If a dispute
cannot be resolved by the Management Committee within a time period
that is satisfactory to the party raising the issue under consideration
and, in any event, within thirty (30) days after the initial referral,
the Management Committee shall refer the dispute to the Executive
Committee. The Executive Committee shall then meet as soon as
reasonable in light of the nature and impact of the issue under
consideration. If a dispute cannot be resolved by the Executive
Committee within a time period that is satisfactory to the party
raising the issue under consideration, and, in any event, within thirty
(30) days after such referral, the Executive Committee shall refer the
dispute to the Chief Executive Officer of Deluxe and the Chief
Executive Officer of eFunds. Such Chief Executive Officers shall meet
as soon as reasonable in light of the nature and impact of the issue
under consideration. If a dispute cannot be resolved by the Chief
Executive Officers within a time period that is satisfactory to the
party raising the issue under consideration and, in any event, within
thirty (30) days after such referral, either party may submit the
dispute for final and binding arbitration as provided in Section 15.4.
Notwithstanding the provisions of this Section 15.3, neither party
shall be required to use this dispute escalation procedure if there is
an actual or alleged violation of such party's Confidential Information
or any other intellectual property rights, and, as to such actual or
alleged violation, either party reserves all rights to seek judicial
remedies and relief, including, without limitation, any injunctive
relief that may be granted by any court of competent jurisdiction.
15.4 Arbitration.
Any dispute between the parties arising out of or resulting from this
Agreement that is not resolved through negotiation pursuant to Section
15.3 and not subject to the litigation exception therein, shall be
settled exclusively by final and binding arbitration in accordance with
the following:
a. except as specified below or otherwise agreed in writing,
the arbitration shall be conducted in accordance with the then-current
Commercial Arbitration Rules of the American Arbitration Association
(such organization, the "AAA" and such rules, the "AAA Rules");
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b. the arbitrators shall be three (3) neutral persons
selected by agreement of the parties or, failing such agreement in the
thirty (30) day period after the initial list of available arbitrators
has been provided to both parties by the AAA, in accordance with the
AAA Rules. Unless otherwise agreed in writing by the parties, one
arbitrator shall be an information technology professional with
technical experience; one arbitrator shall be a certified public
accountant with a major international accounting firm that is not then
serving either party and that has experience in long-term project
contracts; and one arbitrator shall be an experienced business attorney
with experience in information technology transactions and contracts.
If the amount in dispute is less than two hundred fifty thousand
dollars ($250,000), the arbitration shall be conducted by one
arbitrator who shall be an experienced business attorney with
experience in information technology transactions and contracts;
c. any demand for arbitration or any counterclaim shall
specify in reasonable detail the facts and legal grounds forming the
basis for the claimant's request for relief, and shall include a
statement of the total amount of damages claimed, if any, and any other
remedy sought by the claimant;
d. the arbitration proceedings shall take place in
Minneapolis or St. ▇▇▇▇, Minnesota;
e. upon the request of either party, and in the arbitration
panel's or sole arbitrator's discretion, the parties shall be entitled
to limited pre-hearing discovery including depositions of testifying
witnesses, exchanges of documents and lists of testifying witnesses,
and written interrogatories. The arbitration panel or sole arbitrator
shall conduct a hearing within thirty (30) days after the end of
discovery and shall issue an award, supported by a written opinion,
within thirty (30) days after the end of the hearing;
f. the arbitration panel or sole arbitrator may render an
award of monetary damages to either party and direct either or both
parties to take or refrain from taking action, or both. However, the
arbitration panel may not award any exemplary or punitive damages or
any monetary damages or order any action whose fair market value would
be in excess of or beyond the damage limits allowed under Article 14.0;
g. the arbitration panel or sole arbitrator may, at its
discretion, require one party to the arbitration to reimburse the other
party to the arbitration for all or any part of the expenses of the
arbitration paid by the other
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party and the reasonable attorneys' fees and other expenses reasonably
incurred by the other party in connection with the arbitration in
addition to any other relief granted in the award; and
h. judgment upon the award rendered in the arbitration may
be entered in any court of competent jurisdiction.
15.5 Continued Performance.
Unless and until a termination occurs under Section 13.2, 13.3, 13.4 or
13.5, each party shall continue performing its respective obligations
under the Contract Documents, to the extent any of the same have not
been terminated and are in force, in good faith while any dispute
submitted to arbitration under this Article 15.0 is being resolved and
until such obligations are terminated by the expiration of this
Agreement or by a final and binding arbitral award to the contrary
under this Article 15.0.
15.6 Limitation of Actions.
No proceeding, regardless of form, arising out of or related to the
Contract Documents may be brought by either party more than two (2)
years after the accrual of the cause of action, except that (a)
proceedings related to violation of a party's proprietary rights or any
duty to protect Confidential Information may be brought at any time
within the applicable statute of limitations, and (b) proceedings for
non-payment may be brought up to two (2) years after the date the last
payment was due.
16.0 PROVISION OF INSURANCE
16.1 General.
All insurance policies eFunds is required pursuant to this Article 16.0
shall:
a. be primary as to eFunds' negligence and non-contributing
with respect to any other insurance or self-insurance eFunds may
maintain;
b. be provided by reputable and financially responsible
insurance carries with a Best's minimum rating of "A-" (or equivalent)
and Best's minimum financial performance rating of "VII" (or any other
future equivalent);
c. require the insurer to notify Deluxe in writing by
registered or certified mail at least thirty (30) days in advance of
cancellation or material modification, which shall be deemed approved
by Deluxe unless Deluxe notifies eFunds in writing of its disapproval
within fifteen (15) days of receiving such notice from the insurer. In
the event that Deluxe notifies eFunds of its good faith
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disapproval in accordance with this subsection (c), eFunds shall use
commercially reasonable efforts to prevent such cancellation or
modification until eFunds and Deluxe reach a mutual agreement regarding
such change in insurance coverage; and
d. name Deluxe as an Additional Insured on the Commercial
General Liability, Automobile Liability and Professional Liability
policies.
16.2 Coverage.
Commencing on the date that eFunds is no longer a majority owned
subsidiary of Deluxe and during the Term, eFunds shall maintain and
keep in force, at its own expense, the following minimum insurance
coverage and minimum limits:
a. workers' compensation insurance, with statutory limits as
required by the various laws and regulations applicable to the
employees of eFunds performing work hereunder;
b. employer's liability insurance, for employee bodily
injuries and deaths, with a limit of at least US$500,000;
c. comprehensive or commercial general liability insurance,
covering claims for bodily injury, death and property damage, including
premises and operations, independent contractors, products, services
and completed operations (as applicable to the services), personal
injury, contractual, and broad-form property damage liability coverage,
with limits of at least US$5,000,000 per occurrence for bodily injury,
death and property damage and at least US$5,000,000 in aggregate;
d. comprehensive automobile liability insurance, covering
owned, non-owned and hired vehicles, with limits of at least
US$5,000,000;
e. professional liability (errors and omission) insurance
with a single limit of liability of the greater of (i) US$17,500,000 or
(ii) thirty-five percent (35%) of the total Fees and Reimbursable
Expenses paid by Deluxe to eFunds hereunder during the preceding twelve
(12) month period prior to the event causing such damages, net of
rebates, compensatory payments, bonuses and credits, provided, however,
if neither of the foregoing is obtainable by eFunds at commercially
feasible rates and can be so demonstrated in writing to Deluxe's
reasonable satisfaction, such other amount of errors and omission
insurance as the parties may mutually establish in writing, which
insurance policy shall be maintained for the Term and for a period of
not less than three (3) years after termination of the Agreement; and
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f. fidelity/crime insurance for the dishonest acts of
eFunds' employees in a minimum amount of US$5,000,000, which insurance
policy shall name Deluxe as a "loss payee, as their interests may
appear" and which shall cover eFunds' responsibility for the loss of
property belonging to Deluxe and its customers, directly or indirectly.
17.0 GENERAL
17.1 Notices.
Any notice or other communication required or permitted to be made or
given by either party pursuant to the Contract Documents shall be in
writing, in English, and shall be deemed to have been duly given: (a)
five (5) business days after the date of mailing if sent by registered
or certified U.S. mail, postage prepaid, with return receipt requested;
(b) when transmitted if sent by facsimile, provided a confirmation of
transmission is produced by the sending machine and a copy of such
facsimile is promptly sent by another means specified in this Section;
or (c) when delivered if delivered personally or sent by express
courier service. All notices shall be sent to the other party at its
address as set forth below or at such other address as such party shall
have specified in a notice given in accordance with this Section:
----------------------------------------------------------------------
In the case of Deluxe: With a copy to:
----------------------------------------------------------------------
Deluxe Financial Services, Inc. Deluxe Financial Services, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇ Attn: Legal Department
Fax: (▇▇▇)▇▇▇-▇▇▇▇ Fax: (▇▇▇)▇▇▇-▇▇▇▇
----------------------------------------------------------------------
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--------------------------------------------------------------
In the case of eFunds: With a copy to:
--------------------------------------------------------------
eFunds Corporation eFunds Corporation
▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇ F ▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Attn: Legal Department
Fax: (▇▇▇)▇▇▇-▇▇▇▇ Fax: (▇▇▇)▇▇▇-▇▇▇▇
--------------------------------------------------------------
17.2 Reasonable Behavior.
Each party shall act in good faith in the performance of its respective
responsibilities under the Contract Documents and shall not, except as
otherwise expressly provided in the Contract Documents, unreasonably
delay, condition or withhold the giving of any consent, decision or
approval that is either requested or reasonably required by the other
party in order to perform its responsibilities under the Contract
Documents.
17.3 Assignment.
Neither party may assign or otherwise transfer the Contract Documents
or any of the rights that they grant without the prior written consent
of the other party, provided, however, subject to Section 13.4, no such
consent shall be required if a party makes such assignment or transfer
in the course of a sale or acquisition of all or substantially all of
the assets or business of such party and the surviving or acquiring
entity agrees in writing to be bound by all the terms and conditions of
the Contract Documents. Any purported assignment in violation of the
preceding sentence shall be void and of no effect. The Contract
Documents shall be binding upon the parties' respective successors and
permitted assigns.
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17.4 Integration; Amendment.
The Contract Documents constitute the entire agreement between the
parties, and supersede all other prior or contemporaneous
communications between the parties (whether written or oral) relating
to the subject matter of the Contract Documents. The Contract Documents
may be modified or amended solely in a writing signed by both parties
executed by an officer thereof or by the eFunds Account Manager or the
Deluxe Relationship Manager. Each Work Order adopted under this
Agreement shall incorporate the terms and conditions of this Agreement
and shall constitute a separate contract between the parties. A Work
Order may amend the terms and conditions of this Agreement only as they
apply to that particular Work Order and shall not have any general
effect on this Agreement.
17.5 Severability.
The provisions of the Contract Documents shall be deemed severable, and
the unenforceability of any one or more provisions shall not affect the
enforceability of any other provisions. In addition, if any provision
of the Contract Documents, for any reason, is declared to be
unenforceable, the parties shall substitute an enforceable provision
that, to the maximum extent possible in accordance with applicable law,
preserves the original intentions and economic positions of the
parties.
17.6 Order Of Precedence.
In the event of any conflict between or among the provisions contained
in the Contract Documents, the following order of precedence shall
govern: (a) Work Order or applicable Project Plan, (b) Statements of
Work; (c) this Agreement, exclusive of its Exhibits; and (d) Exhibits
to this Agreement.
17.7 No Waiver.
No failure or delay by either party in exercising any right, power or
remedy shall operate as a waiver of such right, power or remedy, and no
waiver shall be effective unless it is in writing and signed by the
waiving party. If either party waives any right, power or remedy, such
waiver shall not waive any successive or other right, power or remedy
the party may have under the Contract Documents.
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17.8 Force Majeure.
Neither party shall be liable for any losses arising out of the delay
or interruption of its performance of its obligations under the
Contract Documents due to any act of God, act of governmental
authority, act of public enemy, or due to war, riot, flood, civil
commotion, insurrection, severe weather conditions, or any other cause
beyond the reasonable control of the affected party (collectively, a
"Force Majeure Event").
a. In and during a Force Majeure Event, the affected party
shall be excused from any further performance or observance of its
obligation(s) , provided such party uses commercially reasonable
efforts to recommence performance or observance whenever and to
whatever extent possible without delay. The affected party shall
immediately notify the other party by telephone or by the most timely
means otherwise available (to be confirmed in writing within two (2)
days of the inception of such event) and describe in reasonable detail
the circumstances of such event;
b. If a Force Majeure Event delays or interrupts the
Services more than the time limits specified in any applicable
Statement of Work or Work Order, Deluxe may, at its option and upon
written notice thereof to eFunds, (i) procure such Services from an
alternate source until eFunds is again able to provide such Services,
or (ii), if the delay or interruption exceeds the earlier of one
hundred eighty (180) days or the termination date of the applicable
Statement of Work or Work Order or the other time therein provided for
termination for Force Majeure Events, if any, terminate the same. If
Deluxe elects option (i), Deluxe shall continue to pay eFunds the Fees
established in the applicable Statement of Work or Work Order during
such period, and eFunds shall be liable for all payments made and costs
incurred by Deluxe required to obtain cover Services from an alternate
source until eFunds notifies Deluxe that eFunds is again able to
provide the Services and Deluxe's contractual commitment to such
alternate source has expired. If Deluxe elects option (ii), Deluxe may
make such termination upon ten (10) days prior written notice,
effective as of a date specified therein, and Deluxe shall pay all Fees
and Reimbursable Expenses due and payable through the termination date,
but in no event shall Deluxe be obligated to pay any Compensatory
Payments described in the applicable Statement of Work or Work Order.
c. Notwithstanding any other provision of this Section 17.8,
a Force Majeure Event shall not relieve eFunds of its obligation to
provide disaster recovery services in accordance with plans described
in the applicable Statement of Work.
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17.9 Non-Use of Deluxe's Name.
eFunds shall not, in the course of performance of this Agreement, or
thereafter, use Deluxe's name in any advertising or promotional media
without the prior written consent of Deluxe, which consent shall not be
unreasonably withheld. The foregoing shall not be deemed to prohibit
any disclosure by eFunds of the existence of the Deluxe customer
relationship or the material terms and conditions of this Agreement
under any applicable securities laws and regulations or the rules of
any stock exchange where the securities of eFunds may be traded.
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WHEREFORE, each party has caused its authorized representative to
execute this Agreement as of the Effective Date.
eFunds Corporation
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Deluxe Corporation
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
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