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EXHIBIT 10.10
PROFESSIONAL SERVICES AGREEMENT
HERITAGE BANK OF COMMERCE, a California state-chartered banking institution,
with an address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ (hereinafter
called "Client"), and RESPONSE DATA CORPORATION, a New Jersey corporation, with
an address at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ (hereinafter called
"Vendor"), in consideration of the mutual covenants contained herein and for
other good and valuable consideration, agree as follows:
SECTION 1. DEFINITIONS.
Unless otherwise defined herein, capitalized terms used herein shall
have the following meaning:
"Completion Schedule" shall mean that schedule set forth in the
applicable Work Statement, with such amendments thereto as shall have
been approved in writing by Client and Vendor.
"Deliverables" shall mean the deliverables set forth in each Work
Statement.
"Services" shall mean those services described in the applicable Work
Statement, including preparation and delivery to Client of the
Deliverables, with such amendments thereto as shall be approved in
writing by Client and Vendor.
""Specifications" shall mean the specifications set forth in the
applicable Work Statement.
"Work Statement" shall mean one or more statements executed by Client
and Vendor substantially in the form of Exhibit A hereto, specifying
in detail Vendor's primary services to be provided, including,
without limitation, a Fee Schedule, a Completion Schedule for said
Services, and the Deliverables to be provided with respect to such
Services.
SECTION 2. SCOPE OF SERVICE.
2.1 Client's engagement of Vendor to provide Services, and Vendor's
acceptance of that engagement shall be evidenced by the parties'
execution and delivery of a Work Statement with respect to such
Services. The parties may agree upon one or more Work Statements from
time to time. Vendor shall provide to Client the Services, and shall
furnish at its expense all the materials, labor, and supplies
necessary for completion of the Services, all in accordance with the
applicable Work Statement and this Agreement.
2.2 Client understands that Vendor's performance is dependent in part
on Client's actions and that any Deliverables are intended to work
with Client's
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computer systems. Accordingly, Client will timely provide Vendor with
the items and assistance specified in the Work Statement and any
dates or time periods relevant to performance by Vendor hereunder
shall be extended day-for-day with any delays in completion by Client
of Client's tasks specified in the Work Statement.
2.3 All software provided by or used by Vendor in conjunction with
the Services shall remain the sole property of Vendor unless software
development is specified as part or the Services in a Work Statement.
Any software that is provided to Client for use by Client is licensed
and not sold to Client, and Client's use of such software shall be
subject to Vendor's standard license agreement that accompanies such
software, a copy of which is attached hereto as Exhibit B. Client
hereby agrees that it is bound by the terms of such license agreement
in connection with its use of Vendor's software.
SECTION 3. COMPENSATION.
3.1 As full compensation for the Services, Vendor shall be paid in
accordance with the fee schedule set forth in the applicable Work
Statement.
3.2 Out-of-pocket expenses, as permitted by the applicable Work
Statement or authorized in writing by an officer of Client, will be
re-billed to Client at cost, and will be reimbursed by Client in
accordance with its then-applicable travel and entertainment policies
(to the extent applicable). Vendor shall invoice Client for such
expenses no more often than once each calendar month, and paid
invoices shall be accompanied by sufficient detail to substantiate
the expenses.
SECTION 4. PAYMENTS.
Vendor will submit invoices to Client for Services rendered as
specified in the applicable Work Statement, or if not specified
therein, then monthly, accompanied by a detailed description of the
Services rendered, an hourly labor log (for services billed hourly)
and all current administrative reports as specified in the Work
Statement or reasonably requested by Client. All undisputed invoices
will be due and payable within 30 days after receipt by Client.
SECTION 5. COMPLETION SCHEDULE.
Vendor shall complete and deliver the Services in accordance with the
Completion Schedule set forth in the applicable Work Statement.
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SECTION 6. CHANGES IN SCOPE OF SERVICES IN AN EXISTING WORK STATEMENT.
If either party proposes a change in the scope of Services under a
particular Work Statement, the other party will reasonably and in
good faith consider and discuss with the proposing party the proposed
change. Both parties recognize that changes in the scope of the
Services that are requested by Client or that are caused by changes
in law or other circumstances beyond Vendor's reasonable control may
necessitate revisions to the fees payable and/or the Completion
Schedule under the applicable Work Statement. If, in the reasonable
opinion of Vendor, a change in the scope of Services to be provided
requires an increase in compensation and/or an extension of the
Completion Schedule under the applicable Work Statement, Vendor shall
notify Client in writing of the nature of the altered/additional work
and the estimated additional fees and/or hours necessary to complete
the changed Services. Vendor shall not undertake such
altered/additional work until both parties have agreed in writing
upon any adjustment in compensation and/or Completion Schedule.
SECTION 7. ACCEPTANCE.
7.1 Upon completion and delivery of the Services, Vendor shall
certify in writing to Client that the Services conform in all
respects to the warranties set forth in this Agreement. Upon receipt
of such certification, Client shall examine/test the Services and
Deliverables to determine that the Services and Deliverables conform
to the warranties set forth in this Agreement and to the acceptance
criteria set forth in the Acceptance Test Plan (to the extent one has
been developed by Client and approved in writing by Vendor).
7.2 Acceptance shall occur when the Services and Deliverables
successfully meet the acceptance criteria set forth above or when
Client commences commercial use of the Deliverables. At the request
of Vendor, Client will provide Vendor with a written notice of
acceptance of the Services and Deliverables, if and when the Services
and Deliverables meet the acceptance criteria or when Client
commences commercial use of the Deliverables.
7.3 If during the acceptance period, Client determines that the
Services or Deliverables, in any way, do not comply fully with the
warranties set forth in this Agreement or applicable acceptance
criteria, Client shall notify Vendor in writing of the reason for
such determination, including any errors which Client may discover.
Vendor shall thereupon have 30 days after such notice to cure the
deficiencies in the Services or Deliverables identified by Client.
When it believes that it has made the necessary corrections, Vendor
will again deliver the Services or Deliverables identified by Client
and the acceptance/rejection/correction provisions above shall be
reapplied until the Services or Deliverable is accepted; provided,
however, that upon the third or any subsequent rejection, Vendor may
terminate this Agreement by 30 days notice unless the Services or
Deliverables are accepted during the notice period. Client may not
reject a resubmitted Service or Deliverable for a failure that
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was present and reasonably discoverable in a previously submitted
Service or Deliverable, but that was not cited in the preceding
rejection notices. If Client identifies a failure with a Service or
Deliverable and Vendor shows that the failure was caused by something
other than the Service or Deliverable, Client will pay Vendor for any
related work to that time at the Vendor's standard time and materials
rates. If a Service or Deliverable is accepted, Vendor will be
conclusively presumed to have met its obligations with respect
thereto.
SECTION 8. PROJECT COORDINATORS
Client and Vendor shall each appoint a project coordinator (the
"Project Coordinator") to: (i) oversee, review and coordinate the
overall provision of the Services under each Work Statement and this
Agreement, (ii) act as a day-to-day contact with the other party, and
(iii) in the case of Client's Project Coordinator, make available to
Vendor the data, facilities, resources and other support services
required by Vendor to perform the Services hereunder. Each party's
Project Coordinator shall be selected solely by that party, but must
be appropriately qualified. The initial Project Coordinators shall be
stated in the applicable Work Statement. Each party may replace its
respective Project Coordinator at any time, upon written notice to
the other party.
SECTION 9. WARRANTIES.
9.1 Vendor warrants, represents and covenants that:
9.1.1 The work herein required shall be conducted in a
good, professional, and workmanlike manner.
9.1.2 Completion and delivery of all data will be in
accordance with the turnaround requirements stated in each
Work Statement. Turnaround is defined as working days,
excluding Saturday, Sunday and federal holidays.
9.2 Client warrants, represents and covenants that it has valid
title, lawful possession and is entitled to use all the data
collected by or provided to Vendor pursuant to this Agreement and
agrees to hold Vendor harmless from any and all damages, including
reasonable legal fees, resulting from any action or claim challenging
title, possession or use of such data.
9.3 Client and Vendor respectively warrant that:
9.3.1 Each party has the requisite and legal authority to
enter into and is capable of performing the obligations
set forth herein.
9.3.2 Each party shall comply in all material respects
with all applicable federal and state statutes, rules and
regulations in connection with each
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party's respective performance of the terms and conditions
of this Agreement.
9.3.3 Each party shall cooperate fully with the other and
provide the other with all reasonable assistance with
respect to the transaction contemplated herein.
9.3.4 The persons executing this Agreement below are
officers duly authorized to sign this Agreement and bind
each of the respective parties to its terms.
9.3.5 OTHER THAN THE WARRANTIES MADE BY VENDOR IN THIS
SECTION 9, VENDOR MAKES NO WARRANTIES TO CLIENT OR ANY
OTHER PERSON OR ENTITY WITH RESPECT TO THE SERVICES OR ANY
DELIVERABLE OR DATA AND DISCLAIMS ALL IMPLIED WARRANTIES,
INCLUDING WITHOUT LIMITATION, WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
9.4 Heritage agrees to be bound by the terms and conditions of the
Mutual Confidentiality Agreement between Vendor and Internet Access
Financial Corporation dated as of August 19, 1996, a copy of which is
attached hereto as Exhibit C.
SECTION 10. LIMITATION OF LIABILITY.
10.1 Neither Vendor nor Client shall in any event be liable for any
loss, damage or reasonable delay arising from any failure to properly
perform its respective duties hereunder if such failure is the result
of circumstances beyond Vendor's or Client's control, including but
not limited to inclement weather, natural disasters, war, declared
and undeclared, fire, flood, loss of utilities, interruption of
transportation, embargo, accident, explosion, equipment malfunctions,
shortages of equipment, governmental orders, regulations,
restrictions or strike or other labor troubles. If any such event,
loss, damage or delay shall occur, the disabled party shall use
diligent efforts to meet its obligations as set forth in this
Agreement. The disabled party shall promptly advise the other party
in writing if it is unable to perform, and of any developments (or
changes therein) that appear likely to affect the ability of that
party to perform any of its obligations in whole or in part.
10.2 Vendor shall not be liable for any inaccuracies in any data
supplied or used with the Deliverables. Vendor shall further not be
liable for the manner in which the data is utilized by Client.
10.3 NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT OR OTHERWISE,
VENDOR SHALL NOT BE LIABLE OR OBLIGATED UNDER ANY SECTION OF THIS
AGREEMENT OR UNDER ANY CONTRACT,
▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY (1)
FOR ANY AMOUNTS IN EXCESS, IN THE AGGREGATE, OF THE FEES PAID TO IT
HEREUNDER IN THE TWELVE MONTH PERIOD PRIOR TO THE DATE THAT THE CLAIM
AROSE OR (II) FOR ANY COST OF PROCUREMENT OF SUBSTITUTE GOODS,
TECHNOLOGY, SERVICES OR RIGHTS.
10.4 NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES, INCLUDING, BUT NOT
LIMITED TO, LOSS OF ANTICIPATED PROFITS OR REVENUES, OR LOSSES FROM
LOSS OR CORRUPTION OF DATA, EVEN IF SUCH PARTY HAS BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGES.
SECTION 11. TERMINATION.
11.1 This Agreement may be terminated by Client or Vendor upon 90
days written notice.
11.2 In the event of termination of this Agreement pursuant to
Section 11.1, Vendor shall be entitled to the compensation and
reimbursements as specified in Sections 3 and 6 for the Services and
Deliverables provided and expenses incurred up to the termination
date.
11.3 Upon termination of this Agreement pursuant to Section 11.1,
each party shall return to the other party any of the other party's
equipment, hardware, software or data that such party has in its
possession.
SECTION 12. INSURANCE.
12.1 Vendor shall maintain during the term of this Agreement the
following insurance:
12.1.1 Worker's compensation and employer's liability
insurance as prescribed by applicable law;
12.1.2 Commercial general liability insurance (bodily
injury and property damage) with contractual liability
insurance to cover liability assumed under this Agreement.
The limits of liability of such insurance shall not be
less than $1,000,000 combined single limit per
occurrence; and
12.1.3 Automobile bodily injury and property damage
liability insurance covering owned, non-owned and hired
automobiles, the limits of which shall not be less than
$500,000 combined single limit per occurrence.
12.2 Upon the request of Client, Vendor shall deliver promptly to
Client certificates of insurance made out by the applicable
insurer(s) or their authorized
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agents the insurance required under this section (the "Required
Insurance") and for any material policy amendments thereto. Each
policy shall provide for 30 days' prior written notice to be given by
the insurer to Client in the event of any termination, non-renewal or
cancellation, or of any material change in coverage or deductibles.
All Required Insurance shall be carried with responsible insurance
companies of recognized standing which are authorized to do business
in the state in which the Services are rendered and are rated A VIII
or better by A.M. Best. If Vendor fails to procure or maintain the
Required Insurance, Client shall have the right, but not the
obligation, to effect such insurance at Vendor's expense.
SECTION 13. INDEPENDENT CONTRACTOR.
It is understood and agreed that Vendor is an independent contractor,
and is not to be considered an employee or agent of Client for any
purpose. This Agreement does not obligate Client to engage Vendor to
provide any Services, and does not obligate Vendor to accept offers
to provide Services. Client does not agree to use Vendor exclusively,
and, subject to Vendor's obligations under this Agreement, Vendor is
free to contract for services for other third parties or institutions
while this Agreement is in force. Written approval from Client, which
approval shall not be unreasonably withheld, shall be required for
Vendor to contract with third parties to provide any of the Services.
SECTION 14. ASSIGNMENT
Client may assign any and all rights and delegate any and all duties
under this Agreement to one or more Affiliates, and Client may assign
its rights and delegate its duties under this Agreement to the
purchaser of all or substantially all of its assets or business. As
used in this Agreement, "Affiliate" means any individual,
corporation, partnership, association, or business that directly or
indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with Client. The term
"control" including the terms "controlling," "controlled by", and
"under common control with" means the possession, direct or indirect,
of the power to direct or cause the direction of the management and
policies of a person, whether through the ownership of voting shares,
by contract or otherwise. The Services provided under this Agreement
will be used by or for the benefit of Client and one or more
Affiliates.
SECTION 15. SECURITY AND AUDITS.
15.1 Vendor promptly shall adopt and implement any reasonable
security procedures requested by Client to protect confidential
information of Client from improper disclosure or use, such
procedures to be reasonably acceptable to Client and in compliance
with all applicable regulatory requirements.
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15.2 Upon twenty four hours notice, Vendor shall from time to time
during regular business hours permit Client representatives to
perform security audits of Vendor's facilities and equipment, and
such other audits as may be necessary to ensure Vendor's compliance
with the terms and conditions of this Agreement.
SECTION 16. ARBITRATION
16.1 Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be settled solely and
exclusively by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association ("AAA"), as
modified below:
16.2 Vendor will initiate arbitration by filing a demand at the
Regional Office of the AAA closest to Client. Client will initiate
arbitration by filing a demand at the Regional Office of the AAA
closest to Vendor. Each demand for arbitration shall describe the
claim and relief sought.
16.3 Disputes will be heard and determined by a panel of three
arbitrators who each are experienced and knowledgeable in the
practices generally of the banking and software industries, and at
least one of the arbitrators will be an attorney. One arbitrator will
be appointed by each party to serve on the panel. One neutral
arbitrator will be appointed by the two arbitrators. If the two
arbitrators selected cannot agree on the appointment of the third
arbitrator within 20 days of their appointment, or if either party
shall fail to appoint its arbitrator within 20 days after receipt of
notice of demand for arbitration, such arbitrator(s) not appointed
shall be selected and appointed by the AAA upon application of either
party.
16.4 Except as set forth below, judgment upon any award of the
majority of the arbitrators shall be final, binding and conclusive,
and may be entered upon the motion of either party in a court of
competent jurisdiction. The award of the arbitrators may grant any
relief which might be granted by a court of competent jurisdiction.
Either party, before or during any arbitration, may apply to a court
of competent jurisdiction for equitable relief where such relief is
necessary to protect its interest pending completion of the
arbitration.
16.5 Any party to an arbitration may petition the court in the state
in which arbitration was held to confirm, correct or vacate the award
on the grounds stated in the Federal Arbitration Act, or to enter
judgment on the arbitration award.
16.6 The costs and expenses of each arbitration hereunder (including
reasonable legal fees) and their apportionment between the parties
will be determined by the arbitrators in their award or decision.
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SECTION 17. EXPORT CONTROL
Client agrees to comply with the U.S. Foreign Corrupt Practices Act
(regarding among other things, payments to government officials) and
all export laws, restrictions, national security controls and
regulations of the United States and all other export or re-export
of, any software contained in the Deliverables or any copy or direct
product thereof (a) in violation of any such restrictions, laws or
regulations or (b) without all required licenses and proper
authorizations, to Cuba, Libya, North Korea, Iran, Iraq or Rwanda or
to any Group D:1 or E:2 country (or any national of such country)
specified in the then current Supplement No. 1 to part 740 of the
U.S. Export Administration Regulations (or any successor supplement
or regulations). Client shall promptly execute any documents required
by Vendor to comply with U.S. export requirements or demonstrate to
Vendor its compliance with such requirements.
SECTION 18. INTEGRATION.
This Agreement, and exhibits attached and any Work Statements
constitute the entire understanding between the parties. Its terms
can be modified only by an instrument in writing signed by both
parties.
SECTION 19. WAIVER.
Any waiver of any breach of any of the provisions of this Agreement
shall not be construed as a continuing waiver of other breaches of
the same or other provisions hereof.
SECTION 20. GOVERNING LAW.
This Agreement has been made in and its validity, interpretation,
construction and performance shall be governed by and be in
accordance with the laws of the State of New Jersey, without
reference to its laws governing conflicts of law.
SECTION 21. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon the parties hereto, their heirs,
successors, assigns and personal representatives, and reference to
the Vendor and Client shall include its successors and permitted
assigns.
SECTION 22. NOTICES
Except for invoices and billing related communications, any notice
required or permitted to be given hereunder by either party to the
other shall be made in writing,
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shall be deemed given when (1) hand delivered by courier service or
otherwise; or (2) sent by facsimile transmission to the addresses/fax
numbers set forth below; or (3) sent by first class or certified
United States mail, postage prepaid, addressed as follows:
To Client:
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Heritage Bank of Commerce
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
To Vendor:
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Response Data Corporation
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to Counsel:
----------------
▇▇▇▇▇▇▇, Phleger & ▇▇▇▇▇▇▇▇ LLP
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If either party changes its address, it shall so advice the other
party in writing and any notice thereunder required to be given shall
be sent as specified herein to such new address.
SECTION 23. SURVIVAL.
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Sections 10, 15, and 24 shall survive the termination or expiration
of this Agreement.
SECTION 24. NON-SOLICITATION.
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During the term of this Agreement and for one (1) year thereafter,
Client will not encourage or solicit any employee or consultant of
Vendor to leave Vendor for any reason and will use reasonable efforts
to ensure that none of Client's Affiliates
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encourage or solicit any employee or consultant of Vendor to leave
Vendor for any reason.
IN WITNESS WHEREOF, the parties have executed, or caused to be executed
by their duly authorized representatives, this Agreement as of the date of the
last signature below.
HERITAGE BANK OF COMMERCE
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
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Title: EXECUTIVE VICE PRESIDENT
--------------------------
Date: 2/27/98
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RESPONSE DATA CORP.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: PRESIDENT
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Date: 10/14/98
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RESPONSE DATA CORPORATION LIMITED LICENSE AGREEMENT
This Limited License Agreement ("Agreement") is entered into as of 10/14/98 by
and between Response Data Corporation ("Response Data"), a New Jersey
corporation and Heritage Bank of Commerce (the "Bank").
WHEREAS, Bank and Response Data have entered into that certain Service Agreement
of even date herewith (the "Service Agreement"), pursuant to which Response Data
has agreed to provide certain payment processing services to Bank (the
"Services"); and
WHEREAS, as part of providing the Services to Bank, Response Data desires to
grant Bank a license to use certain application software and on-line remote
access software that will be copied to certain client computers on Bank's
computer network, located at Bank's premises, to facilitate the transfer of data
from Bank to Response Data in conjunction with the Services (the "Software").
NOW THEREFORE, THE PARTIES AGREE AS FOLLOWS:
1. LICENSE. Subject to the terms of this Agreement, Response Data grants to Bank
the non-exclusive, nontransferable right and license to use the Software but
only (i) at the Bank's facilities at __________________________ , (ii) on client
computers with a single Central Processing Unit, (iii) for purposes of
permitting Response Data to perform the Services, (iv) in accordance with any
accompanying written materials supplied by Response Data, including but not
limited to, any user manuals or guides, and (v) in compliance with any security
measures and policies established by Response Data from time to time (the
"License"). The Software may only be installed and copied by an authorized
representative of Response Data or with the prior written consent of Response
Data.
2. COPYRIGHT. All proprietary rights and trade secrets in the Software and the
accompanying written materials are owned by Response Data or its licensors and
are protected by United States copyright laws, other applicable copyright laws
and international treaty provisions. Response Data retains all rights not
expressly granted herein.
3. RESTRICTIONS. Bank may not use, copy, alter, merge, adapt, modify,
distribute, rent, lease or sublicense the Software or the accompanying written
materials, or any copy thereof, in whole or in part, except as expressly
provided in this Agreement. Bank may not reverse-engineer, decompile or
disassemble the Software or remove any proprietary notices or labels in or on
the Software. In the course of using any Software for remote access to Response
Data's computer networks, Bank and its employees and agents shall not access or
use any third party information and shall insure that Bank and its employees and
agents do not breach any security measures used by Response Data, including but
not limited to, any "firewalls". However, the foregoing restrictions are limited
so that they prohibit such activities only to the extent such activities may be
prohibited without violating applicable statutes.
4. CONFIDENTIAL. The Software, Response Data's computer networks and the
information contained therein, are confidential and proprietary to Response
Data. Bank agrees to treat the Software, Response Data's computer networks and
the information contained therein, as strictly confidential and will not
disclose the same to any third party and will comply with its obligations under
the Service Agreement or any separate Confidentiality Agreement in relation
thereto.
5. TERM. The License is effective for the duration of the Service Agreement.
However, this License may be terminated earlier by Response Data if Bank fails
to cure any breach of this Agreement within thirty (30) days after such breach
first occurs. Upon any termination Bank agrees to either return to Response Data
or
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destroy all copies and portions of the Software and the accompanying written
materials held by Bank.
6. LIMITED WARRANTY AND DISCLAIMER. Response Data warrants that the media on
which the Software is furnished is free from defects in materials and
workmanship under normal use for a period of thirty (30) days from the date of
receipt by Bank. EXCEPT FOR THE FOREGOING AND ANY WARRANTIES SET FORTH IN THE
SERVICE AGREEMENT, THE SOFTWARE AND THE ACCOMPANYING WRITTEN MATERIALS ARE
PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND, WHETHER EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE. FURTHER, RESPONSE DATA DOES NOT WARRANT, GUARANTEE, OR MAKE
ANY REPRESENTATIONS REGARDING THE USE, OR THE RESULTS OF THE USE, OF THE
SOFTWARE OR THE WRITTEN MATERIALS OR THAT THEY ARE ERROR FREE.
7. LIMITATION OF LIABILITY AND REMEDIES. RESPONSE DATA'S LIABILITY AND BANK'S
REMEDIES WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT UNDER ANY
CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY SHALL BE LIMITED AS
SPECIFIED IN THE SERVICE AGREEMENT.
8. INTERPRETATION. If one or more provisions of this Agreement are held to be
illegal or unenforceable under applicable law, such illegal or unenforceable
portion(s) shall be limited or excluded from this Agreement to the minimum
extent required so that this Agreement shall otherwise remain in full force and
effect and enforceable in accordance with its terms.
9. GENERAL. The Sections from Section 18 through to the last Section of the
Service Agreement are incorporated herein by reference and shall apply in
relation to this Agreement as well as to the Service Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
RESPONSE DATA CORPORATION BANK: HERITAGE BANK OF COMMERCE
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------- --------------------------------
Name ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------- --------------------------------
Title Pres. Title E.V.P.
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MUTUAL NONDISCLOSURE AGREEMENT
Each undersigned party (the "Receiving Party") understands that the
other party (the "Disclosing Party") has disclosed or may disclose information
relating to (i) computer programs, computer code, modules, scripts, algorithms,
features and modes of operation, inventions (whether or not patentable),
techniques, processes, schematics, testing procedures, software design and
architecture, design and function specifications, analysis and performance
information, user documentation, internal documentation or (ii) the Disclosing
Party's business (including, without limitation, names and expertise of
employees and consultants, know-how, ideas, and other technical, business,
financial, customer and product development plans, forecasts, strategies and
information), which to the extent previously, presently, or subsequently
disclosed to the Receiving Party is hereinafter referred to as "Proprietary
Information" of the Disclosing Party.
In consideration of the parties' discussions and any access the
Receiving Party may have to Proprietary Information of the Disclosing Party, the
Receiving Party hereby agrees as follows:
1. The Receiving Party agrees (i) to hold the Disclosing Party's
Proprietary Information in strict confidence and to take all reasonable
precautions to protect such Proprietary Information (including, without
limitation, all precautions the Receiving Party employs with respect to its
confidential materials), (ii) not to divulge any such Proprietary Information or
any information derived therefrom to any third person (including, but not
limited to, any affiliated person or entity), (iii) not to make any use
whatsoever at any time of such Proprietary Information except to evaluate
internally whether to enter into an agreement with the Disclosing Party relating
to the Automated Balance Transfer Service (the "Transaction"), (iv) not to
remove or export from the United States or reexport any such Proprietary
Information or any direct product thereof to Afghanistan, the Peoples' Republic
of China or any Group Q, S, W, Y or Z country (as specified in Supplement No. 1
to Section 770 of the U.S. Export Administration Regulations, or a successor
thereto) or otherwise except in compliance with and with all licenses and
approvals required under applicable export laws and regulations, including
without limitation, those of the U.S. Department of Commerce, and (v) not to
copy or reverse engineer any such Proprietary Information. Any employee given
access to any such Proprietary Information must have a legitimate "need to know"
and shall be similarly bound in writing. Without granting any right or license,
the Disclosing Party agrees that the foregoing clauses (i), (ii), (iii) and (v)
shall not apply with respect to any information after five (5) years following
the disclosure thereof or any information that the Receiving Party can document
(a) is or (through no improper action or inaction by the Receiving Party or any
affiliate, agent, consultant or employee) generally available to the public, or
(b) was in its possession or known by it prior to receipt from the Disclosing
Party, or (c) was rightfully disclosed to it by a third party, provided the
Receiving Party complies with restrictions imposed by such third party, or (d)
was independently developed without use of any Proprietary Information of the
Disclosing Party. The Receiving Party may make disclosures required by court
order provided the Receiving Party uses diligent efforts to limit disclosure and
to obtain confidential treatment or a protective order and has
15
allowed the Disclosing Party to participate in the Proceeding.
2. Immediately upon (i) the decision by either party not to enter
into the Transaction contemplated by paragraph 1, or (ii) a request by the
Disclosing Party at any time (which will be effective if actually received or
three days after mailed first class postage prepaid to the Receiving Party's
address herein), the Receiving Party will turn over to the Disclosing Party all
Proprietary Information of the Disclosing Party and all documents or media
containing any such Proprietary Information and any and all copies or extracts
thereof. The Receiving Party understands that nothing herein (a) requires the
disclosure of any Proprietary Information of the Disclosing Party, which shall
be disclosed if at all solely at the option of the Disclosing Party (in
particular, but without limitation, any disclosure is subject to compliance with
export control laws and regulations), or (b) requires the Disclosing Party to
proceed with any proposed transaction or relationship in connection with which
Proprietary Information may be disclosed.
3. Except to the extent required by law, neither party shall disclose
the existence or subject matter of the negotiations or business relationship
contemplated by this Agreement.
4. This Agreement will apply only to disclosures made within two
years of the date of this Agreement. However, the obligations hereunder with
respect to any disclosure made within that period will survive any termination
or expiration of this Agreement.
5 The Receiving Party acknowledges and agrees that due to the unique
nature of the Disclosing Party's Proprietary Information, there can be no
adequate remedy at law for any breach of its obligations hereunder, that any
such breach may allow the Receiving Party or third parties to unfairly compete
with the Disclosing Party resulting in irreparable harm to the Disclosing Party,
and therefore, that upon any such breach or any threat thereof, the Disclosing
Party shall be entitled to appropriate equitable relief in addition to whatever
remedies it might have at law and to be indemnified by the Receiving Party from
any loss or harm, including, without limitation, attorney's fees, in connection
with any breach or enforcement of the Receiving Party's obligations hereunder or
the unauthorized use or release of any such Proprietary Information. The
Receiving Party will notify the Disclosing Party in writing immediately upon the
occurrence of any such unauthorized release or other breach of which it is
aware. In the event that any of the provisions of this Agreement shall be held
by a court or other tribunal of competent jurisdiction to be illegal, invalid or
unenforceable, such provisions shall be limited or eliminated to the minimum
extent necessary so that this Agreement shall otherwise remain in full force and
effect. This Agreement shall be governed by the law of the State of New Jersey
without regard to the conflicts of law provisions thereof. This Agreement
supersedes all prior discussions and writings and constitutes the entire
agreement between the parties with respect to the subject matter hereof. The
prevailing party in any action to enforce this Agreement shall be entitled to
costs and attorneys' fees. No waiver or modification of this Agreement will be
binding upon either party unless made in writing and signed by a duly authorized
representative of such party and no failure or delay in enforcing any right will
be deemed a waiver.
In witness whereof, the parties have executed this Agreement as of
the day and
2
16
year set forth below.
October 8, 1997
RESPONSE DATA CORPORATION INTERNET ACCESS FINANCIAL CORPORATION
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------- --------------------------------
Name ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Name ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------- --------------------------------
Title President Title Chief Operating Officer
----------------------------- --------------------------------
3
17
ADDENDUM TO
PROFESSIONAL SERVICES AGREEMENT
BETWEEN
HERITAGE BANK OF COMMERCE AND RESPONSE DATA CORPORATION
Heritage Bank of Commerce ("Client") and Response Data Corporation
("Vendor") hereby agree to the addition of the following terms to the
Information Services Agreement between Client and Vendor dated 10/14/98:
1. PERFORMANCE STANDARDS. While this Agreement is in effect, Vendor
shall at all times maintain the necessary telephone line, computer capacity and
staff necessary to provide the Services in accordance with the procedures, time
frames and other performance standards set forth in the Work Statement and as
otherwise agreed in writing between Vendor and Client.
2. RECORDS RETENTION. Vendor shall maintain account records and
transaction documentation regarding the Services described in the Work Statement
("Service Records"), and shall retain copies of all Service Records for a
minimum of five years. Vendor shall not obtain any proprietary rights in any
Service Records, and all Service Records shall remain the property of Client.
Upon termination of this Agreement, all Service Records shall be returned to
Client in machine-readable format.
3. DISASTER RECOVERY PLANS. Vendor has created a disaster recovery
plan and shall provide suitable off-premises storage for copies of all Service
Records and computer programs used in connection with the performance of the
Services in order to provide adequate backup in the event of loss, damage or
destruction of any equipment or information. Vendor's disaster recovery plan is
attached hereto as Exhibit A. Client may make reasonable requests that Vendor
review or revise its disaster recovery plan and may request copies of any
revised disaster recovery plan.
4. CONFIDENTIAL INFORMATION. Each party agrees to hold in the most
strict and absolute confidence all information, data and materials of the other
party or any third party dealing with Client or Vendor which are disclosed,
received, acquired, or learned by Vendor or Client in the course of rendering
the Services described in the Work Statement, including without limitation the
Service Records. Each party shall maintain strict security controls over all
items, records, input materials, and instruments delivered to it, and over all
communications lines and facilities used in connection with the Services, all in
accordance with the security standards ordinarily followed by the party. The
provisions of this paragraph may be enforced by injunction or other equitable
relief, and the parties do hereby specifically recognize that neither party has
18
any adequate remedy at law in order to compel the enforcement of the provisions
of this paragraph. Upon termination of this Agreement, each party agrees to
return to the other any customer or other information or materials provided by
that party during the term of this Agreement, including but not limited to all
Service Records, and shall not use such materials thereafter. The
confidentiality provisions of this paragraph shall survive the termination of
this Agreement.
5. REGULATION AND EXAMINATION. The performance of services by Vendor
in accordance with this Agreement will be subject to regulation and examination
on Vendor's premises by the government agencies which regulate and examine
Client as if such services were being performed by Client itself on its own
premises. Client shall notify Vendor of any pending regulatory examination of
which Client has knowledge.
6. FINANCIAL STATEMENTS. Vendor shall provide Client with a copy of
Vendor's reviewed financial statements within 90 days of the end of each fiscal
year of Vendor.
7. TERMINATION FOLLOWING INSOLVENCY. Client may immediately terminate
this Agreement in the event Vendor (i) is dissolved, becomes insolvent,
generally fails to pay or admits in writing its inability to pay its debts as
they become due; (ii) makes a general assignment, arrangement, or composition
agreement with or for the benefit of its creditors; or (iii) files a petition in
bankruptcy or institutes any action under federal or state law for the relief of
debtors or seeks or consents to the appointment of an administrator, receiver,
custodian, or similar official for the wind up of its business (or has such a
petition or action filed against it and such petition action or appointment is
not dismissed or stayed within 30 days).
8. ASSIGNMENT BY VENDOR. Vendor shall not assign its interest under
this Agreement without the advance written consent of Client, which consent
shall not be unreasonably withheld.
Dated: 2/27/98 HERITAGE BANK OF COMMERCE
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
Title: E.V.P
----------------------------
Dated: 10/14/98 RESPONSE DATA CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Title: Pres.
----------------------------
2
19
STATEMENT OF WORK
INTERNET ACCESS FINANCIAL CORPORATION AND RESPONSE DATA
CORPORATION
1. Data Acquisition - RDC will receive balance transfer transactions from
NextCard cardholders via daily (Monday through Friday) data transmissions
from FDR Bankcard Program Services. The data transmission will be in a
format consistent with the Balance Transfer Input Format provided by RDC
to both Internet Access Financial Corporation and FDR Bankcard Program
Services. Cardholders may initiate multiple balance transfers transactions
per request.
2. Data Validation - RDC will perform data validation on each balance
transfer transaction request to ensure that the required data elements
necessary to process are present on the day that the balance transfer
request is received by RDC. The data validation criteria are as follows:
- Cardholder Account Number is Non-Numeric
- Cardholder Name and Address is Incomplete
- Payment is Not Unique
- Payee Account Number is Blank
- Payment Amount is Zero or Non-Numeric
- Total Payments are Less Than $500.00
- Payee Name Matches Cardholders's Or Cash
- Payee Address Matches Cardholder's
- PAYEE NAME IS INCOMPLETE
- Payee Account Number Matches Client
RDC will segregate all balance transfer transaction requests which do not
pass data validation and make them resident in an "Edit Reject Queue" to
be reviewed/worked on a daily basis by Internet Access Financial
Corporation personnel. RDC will process the queue on a daily basis,
capturing all record changes made to the items in the queue.
3. Authorization Request - RDC will send a batch file to FDR, Internet Access
Financial Corporation's third-party batch authorization system, for
authorization on the day that the balance transfer transaction request is
received by RDC. Upon receipt of the appropriate response file from FDR,
RDC will on the same day segregate all rejected authorizations and make
them resident in an "Authorization Reject Queue" to be reviewed/worked on
a daily basis by Internet Access Financial Corporation personnel. RDC will
process the queue on a daily basis, capturing all record changes made to
the items in the queue.
4. Payment Processing - RDC will identify which balance transfer transaction
requests that have been authorized can be made electronically and will
route these payments
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through MasterCard's Remittance Processing Service for payment. The
payment file will be sent to RPS on the same day that the authorization
response file is returned to RDC by FDR. Payments which were deemed by RDC
as incapable of being made electronically will be placed into a paper
check file and transmitted to the Standard Register Company on the same
day that the authorization response file is returned to RDC by FDR. The
paper checks will be printed by the Standard Register Company the day
following receipt of the paper check file and placed into the USPS
mailstream via first class mail. Internet Access Financial Corporation
will establish a postage escrow account at Standard Register to fund
outgoing postage costs. Any rejected RPS payments will be placed into the
paper check file of the following day and transmitted to the Standard
Register Company.
5. Posting Debits to Cardholder's Accounts - For Payments processed through
MasterCard Remittance Processing Service, RDC will send a Post file to FDR
to debit the cardholder's account for the Balance Transfer transaction.
The Post file for electronic transfers will be transmitted the day
following authorization. The Post file for paper check payments will be
transmitted seven (7) days following authorization.
6. CIS Memos (Non-Mon 115) - RDC will transmit to FDR on a daily basis CIS
Memos to appear on the event tracking customer service screens. These
messages, as specified by Internet Access Financial Corporation, will
indicate the status of each cardholder balance transfer transaction
request.
7. Settlement - All RPS electronic payments will be funded by a demand
account (account number ▇▇▇▇▇▇▇) at Heritage Bank, San Jose, CA. RPS will
draw down funds for settlement at 2 p.m. (Eastern Time), the day following
the submission of the payments. RDC and RPS will provide Internet Access
Financial Corporation with daily reports to be used for settlement and
funding. All paper checks will be drawn against a demand account, separate
from the demand account used for electronic payments, (account number
▇▇▇▇▇▇▇) at Heritage Bank, San Jose, CA. RDC will provide Internet Access
Financial Corporation with reports to be used to assist in reconciliation.
On a daily basis, RDC will transmit to Heritage Bank a checks issued file
containing the following:
- Issue Date
- DDA Account Number
- Serial Number
- Amount
In return, Heritage Bank will provide RDC with a daily checks paid file
via transmission listing all paper checks which have cleared account
number ▇▇▇▇▇▇▇.
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8. Cardholder Correspondence - RDC will create and send via e-mail a
cardholder letter to be used in the following instances:
- Confirmation- All balance transfer requests were successful
- Retraction- No balance transfer requests were successful
- Partial Retraction- Some balance transfers successful, some
not.
- Stop Pay- Paper check used to make balance transfer payment
has not been cashed.
The letter text used will be the copy approved by Internet Access
Financial Corporation. Only the last 4 digits of the cardholder account
number will be reflected on all correspondence.
9. Returned Cardholder Correspondence - In the event that an e-mail letter is
returned, or an e-mail address is not provided, RDC will then produce a
paper letter to be sent to the cardholder. Internet Access Financial
Corporation will supply RDC with letter stock and single window #10 outer
envelopes. Additionally, a postage escrow account will be established by
Internet Access Financial Corporation to fund outgoing postage costs. All
correspondence will be placed into the mailstream using first-class
postage.
10. On-Line System - RDC will provide its on-line system which will give
designated Internet Access Financial Corp. employees immediate, current
customer service inquiries and review capability. The on-line system will
allow the following:
- View transaction histories and obtain dates when events
occurred.
- Obtain and verify trace numbers for electronic payments.
- Obtain payment clearing dates (providing the successful
transmission of a checks cleared file by Heritage Bank)
- Review authorization status.
- Review letter status.
- Provide on-line reporting access.
- Queue data validation and authorization transaction
failures.
11. Report Generation - RDC will provide Internet Access Financial Corp. with
reports on-line on a daily basis as follows:
- Electronic Balance Transfer Register
- Paper Check Register
- Balance Transfer Reconciliation
- Top Payee Listing
- Balance Transfer Breakdown/Analysis
Requests for any additional custom reports should be made in writing and
will be reviewed when submitted.
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12. Stop Payment - RDC will provide Heritage Bank with a daily paper report
indicating all paper checks which require the placement of a stop pay. Any
paper checks outstanding for 30 DAYS will be subject to the placement of a
stop pay. Additionally, any paper checks returned by payees that cannot be
applied, due to missing data, inaccurate data, or such reasons, will also
be included on the stop pay report. A contact at Internet Access Financial
Corporation will be made available to RDC for the purpose of reconciling
such returns and having the responsibility of crediting cardholder
accounts.
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RESPONSE DATA CORP. PRICING FOR HERITAGE BANK OF COMMERCE
- One time programming, development and implementation charge of $12,000 due
at the end of six months from the date of contract.
- Transaction cost: $1.50 per transaction.
- Monthly project management fee for first 12 months:
Month Fee
----- ---
Dec 1000
Jan 1000
Feb 1000
Mar 2000
Apr 2000
May 2000
Jun 3000
Jul 3000
Aug 3000
Sep 4000
Oct 4000
Nov 4000
Monthly beginning December, 1998: $2500/mo.
- Postage costs for letters sent to Heritage Bank Customers- at cost.
RPS Electronic Transfer (non-RDC) Associated costs:
- $250/month.
- $.045 per transaction.