US MERCHANT SYSTEMS MULTI-LOCATION PRIMARY MERCHANT AGREEMENT
Exhibit
10.16
US
MERCHANT SYSTEMS
This
Agreement is entered into between US MERCHANT SYSTEMS, LLC. (“USMS”), of ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (USMS), and NIMBLE GROUP, INC., located at
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▇▇▇▇▇▇,
▇▇▇▇
▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, herein known as “Client.”
R
E C I T A L S
WHEREAS,
USMS, Global Payments, Inc., HSBC Bank USA, N.A., and Client have entered into
a
Merchant Processing Agreement and Business Agreement dated September 7, 2005.
WHEREAS,
USMS and Client have entered into Merchant Processing Agreements for the
processing of payments of Local and County government entities (“Government
Entities”) for which Client is the Primary Merchant Account holder.
WHEREAS,
Client has agreed to be the Primary Merchant Account holder for said Government
Entities.
NOW
THEREFORE, the purpose of this Agreement is to define the terms and conditions
of both Parties arising from the fact that Client is Primary Merchant Account
holder for Government Entities, as follows:
T
E R M S A N D C O N D I T I O N S
SECTION
ONE: CLIENT DUTIES AND RESPONSIBILITIES.
| 1.0 |
Authority:
By submitting a Merchant Application on behalf of Government Entities,
Client attests that it is authorized by Government Entities to enter
into
a Merchant Processing Agreement and Business Agreement on Government
Entities’ behalf.
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| 1.1 |
Account
Applications:
All Merchant Applications from Client on behalf Government Entities
shall
fall under the terms and conditions of this Multi-Location Primary
Merchant Account Agreement as well as the Merchant Processing Agreement
and Business Agreement in place with Client and USMS.. An account
application will consist of a USMS Merchant Application filled out
by
Client, which indicates the DBA of the Government Entity, location
information, equipment information, payment information for equipment,
and
DDA account information (if other than on Primary Merchant Account
holder’s application).
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| 1.2 |
Compliance:
By entering into a Merchant Processing Agreement on behalf of Government
Entities, Client accepts complete responsibility for Client and Government
Entities to agree, abide and comply
with:
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| (a) |
Terms
and conditions of the Merchant Processing
Agreement.
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| (b) |
Operating
Regulations set forth by Card
Associations.
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| 1.3 |
Deposits:
Client acknowledges that all deposits as a result of Government Entities’
card acceptance are deposited into a DDA account designated by Client.
Client is responsible for prompt and accurate distribution of said
deposits to Government Entities. USMS shall be indemnified and held
harmless by Client and its Government Entities from any liability
as a
result of Client failing to distribute, or incorrectly distribute,
deposits made into said DDA account by
USMS.
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| 1.4 |
Fees:
During any period of time in which this Agreement and Merchant Processing
Agreement remains in full force and effect, Client is responsible
for all
rates and fees for Client’s and Government Entities’ merchant
accounts,
as
set forth in the attached Schedule A, which is made a part of this
Agreement. Client shall hold the compensation plan set forth in Schedule
A
in strict confidence. USMS may only amend Schedule A to reflect any
increases or decreases in the direct costs that it is charged by
its
vendors, Visa, MasterCard and other similar entities.
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| 1.5 |
Risk
Management and Fraud:
Client acknowledges that there is an inherent risk involved in handling
bankcard transactions. Client acknowledges that it understands its
responsibilities pertaining to all Chargebacks, Retrievals, ACH Rejects
and other liabilities as outlined in the Merchant Processing Agreement
for
all Government Entities submitted to USMS. Client understands, as
USMS
makes deposits into its designated DDA account, and where Client
is the
Primary Merchant Account holder, that Clients shall be responsible
for,
and have funds available to cover, any Chargeback and Retrieval activity
for any reason, inclusive of fraud, on any Government Entity merchant
account.
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| 1.6 |
Collection
of Fees:
Client is responsible for the collection of any fees from Government
Entities as a result of any agreements it has in place with Government
Entities. In turn USMS shall collect fees directly from
Client.
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| 1.7 |
Reports
and Statements:
Client shall be responsible for providing accurate statements, reports
and
accounting for all transaction activity and fees to Government
Entities.
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| 1.8 |
Transaction
Infrastructure:
Client shall be responsible for the upkeep, maintenance and operations
of
its VeriFone Rapid Internet Transaction Authority server and Client’s
NimBill product/service, its connectivity to POS devices and the
Global
East (NDC) platform and acknowledges that USMS does not offer technical
support for this specific product. Since POS applications loaded
onto the
POS equipment by Client are proprietary to Client, USMS shall be
held
harmless from any difficulties or errors resulting from said terminal
application, unless where this application was altered or loaded
by USMS.
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| 1.9 |
Application
Support:
Client shall be responsible for loading its proprietary POS terminal
application into the equipment provided by USMS. Client shall provide
USMS
with a copy of its POS terminal application for the sake of USMS
offering
POS terminal support to Government Entities. Client will support
USMS with
this POS terminal application as
needed.
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| 1.10 |
Supplies:
Client acknowledges primary responsibility to provide Government
Entities
with supplies for its VeriFone terminals inclusive of paper rolls.
USMS
may provide such supplies on an emergency basis for which Client
will be
billed for supplies and shipping and handling costs as set forth
in
Schedule A of this agreement.
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| 1.11 |
Security
of Information:
Client agrees that Client will be certified, within reasonable time,
by a
third-party auditor who is endorsed by both Card Associations, to
be in
compliance with Visa’s Cardholder Information Security Program and
MasterCard’s Site Data Protection programs (“CISP/SDP”). USMS shall be
indemnified and held harmless by Client and its Government Entities
from
any liability as a result of any type of security breach suffered
by, or
caused by, Client or failure to pass a CISP/SDP audit. Any and all
fines
resulting from a security breach and/or non-compliance with CISP/SDP
levied against USMS, Global Payments, Inc. and/or HSBC Bank USA,
N.A. by
the Card Associations and/or any of its Members shall be passed on
to
Client and Client shall be responsible for paying such
fines.
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SECTION
TWO: USMS DUTIES AND RESPONSIBILITIES.
| 2.0 |
Processing
Services:
USMS will provide POS credit and debit card processing services to
Client
on behalf of Government Entities as outlined in the Merchant Processing
Agreement.
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| 2.1 |
Reports
and Statements:
USMS shall provide monthly processing statements for all Client and
Government Entity processing activity and fees to Client.
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| 2.2 |
Support:
USMS shall provide access to customer service and terminal support
twenty-four hours per day, seven days per week, as follows: USMS
provides
direct support from 7:00AM until 7:00PM Pacific Time Monday though
Friday,
during all other hours and days support shall be provided directly
by
Global Payments, Inc. which has complete access to information on
authorizations, batch settlement and deposits. USMS shall provide
first-level POS application support and Client shall act in accordance
with paragraph 1.9 of this agreement. Client is responsible for obtaining
a Class A certification for its proprietary POS terminal application
in
order for Global Payments, Inc. to provide technical support on said
application.
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| 2.3 |
PIN
Encryption:
USMS shall provide the service of injecting Global East (NDC)
PIN-encryption keys for Client for a fee set forth in Schedule A
of this
Agreement.
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| 2.4 |
Equipment:
USMS shall provide POS terminal equipment for Government Entities
and ▇▇▇▇
Client on a rental fee basis as set forth in Schedule A of this Agreement.
Client is granted to keep an inventory of up to five (5) POS terminals
that will be rented to Client by USMS. POS terminal equipment shall
be
provided without a loaded POS terminal application. Client shall
be
responsible for the payment of rental fees for all equipment it orders
on
behalf of Government Entities. If a Terminal Warranty Fee is charged
by
USMS to Client, USMS shall offer free replacement of defective equipment
unless the equipment was damaged in a deliberate manner in which
case
Client shall be responsible for replacing said equipment either by
purchasing equipment from USMS or other vendor it chooses to use.
Client
shall be responsible for returning rented equipment in order for
USMS to
cease billing of rental payments, inclusive of termination of this
Agreement. In the event where Client cannot return equipment, Client
shall
be responsible for replacing lost equipment back to
USMS.
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SECTION
THREE: GENERAL
| 3.0 |
Term:
Unless otherwise terminated for cause, the term of this Agreement
shall be
for the duration of the Merchant Processing Agreement in place between
all
Parties as stated in the Recitals of this
Agreement.
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| 3.1 |
Termination
of Agreement:
Either party may terminate this Agreement upon occurrence of a material
breach of any of the provisions of this Agreement or associated Merchant
Processing Agreement if such breach is not reasonably cured to the
satisfaction of the offended party within thirty (30) days upon receipt
of
written notice of such breach. Termination of agreement shall not
apply to
the terms of any lease associated with this agreement.
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| 3.2 |
Notice:
Any notice required pursuant to this Agreement shall be deemed valid
if
delivered through the following methods: certified mail-return receipt
requested, and postage prepaid, facsimile with verification of
transmission, or in overnight courier addressed as set forth
below:
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If
to Client
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If
to USMS
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▇▇▇▇▇▇▇,
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Attn:
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Attn:
Cihat Zeyt
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| 3.3 |
Assignment:
This Agreement may not be sold, assigned, transferred or pledged,
in whole
or in part, by Client without the express prior written consent of
USMS,
which consent shall not be unreasonably withheld. This clause shall
not
limit Client’s ability to transfer this agreement in the event of sale of
Client’s business.
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| 3.4 |
Corresponding
Agreements:
Client acknowledges that this Agreement incorporates by reference
all
terms and conditions stated in the accompanying documents including
but
not limited to the Merchant Processing Agreement as provided HSBC
Bank
USA, N.A. or other such sponsoring member bank, as may be used to
execute
this agreement and the Merchant Application inclusive of the terms
and
conditions stated therein, and any other documents executed and referenced
herein.
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| 3.5 |
Waiver:
Failure on the part of Client or USMS to exercise any rights or privileges
granted to each shall not be construed as waiving any such rights,
privileges, obligations, or duties, or as creating any custom contrary
hereto. Any waiver of any right, privilege, obligation, or duty must
be in
writing, and if not in writing will not be binding in anyway. Any
written
waiver of any right, duty, or obligation by Client or USMS shall
not
operate beyond its term.
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| 3.6 |
Governing
Law; Consent to Jurisdiction: This
Agreement shall be governed by, interpreted and construed in all
respects
in accordance with and under the laws of the State of California.
The
Parties hereto agree that, with respect to any claim arising out
of this
Agreement, such claims shall be submitted for dispute resolution
in the
County of Alameda, State of California. In such case the prevailing
party
shall be entitled to reimbursement of court costs and attorney’s fees as
adjudicated in any such proceeding.
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| 3.7 |
Force
Majeure:
Client agrees that USMS will not be liable for any loss, expense
or cost
incurred by Client, any Affiliate or Customer of Client or any other
person or entity resulting from the failure of USMS to perform under
this
Agreement due to causes beyond the reasonable control of USMS, including,
but not limited to; war, fire, earthquakes, acts of God, power failures,
Government priorities, labor stoppage, ill employees, supplier failure
to
deliver or delay products or services, civil disorder, or breakdown
or
malfunction of utilities, communication systems, machinery, transportation
facilities or other systems of any nature, provided, however, that
USMS
shall, take all reasonable, practical and necessary steps in such
event or
events to affect prompt resumption of performance
hereunder.
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| 3.8 |
Severability: Any
finding by a court of competent jurisdiction of the invalidity of
any part
of this Agreement shall not affect the validity of any of the remaining
provisions of this Agreement.
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| 3.9 |
Entire
Agreement:
This Agreement and other agreements referenced herein constitute
the
entire Agreement between USMS and Client. No modification or amendments
to
this Agreement shall be effective until it is set forth in writing,
executed by the Parties and attached as an amendment
hereto.
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| 3.10 |
Agency:
USMS is a registered agent of HSBC Bank USA, N.A. and Global Payments,
Inc. and acts accordingly in this
Agreement.
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The
above
stated terms and responsibilities are entered into freely as represented by
Parties signatures below.
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Nimble
Group, Inc.:
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US
Merchant Systems, LLC:
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By:
/s/
▇▇▇▇ ▇. ▇▇▇▇
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By:
___________________________
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Date:
July 1, 2006
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Date:
__________________________
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Print
Name: ▇▇▇▇ ▇. ▇▇▇▇
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Print
Name: Cihat Zeyt
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Title:
Controller
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Title:
COO
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