SHOPPERS CHARGE ACCOUNTS CO. PRIVATE LABEL CREDIT CARD AGREEMENT
Exhibit
10.13
SHOPPERS
CHARGE ACCOUNTS CO.
THIS
AGREEMENT is made effective this 30th day of October, 2006 by
and
between Shoppers Charge Accounts Co., a division of TD Banknorth, N.A., having
an office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ (“SCA”), and New
Colorado Prime Holdings, Inc., D/B/A Colorado Prime Foods and DineWise, having
its principal office at ▇▇▇ ▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(“Merchant”).
Recitals
WHEREAS,
SCA is in the business of providing private label credit card programs to
retailers and their customers (the “Program”), and in connection therewith lends
to such customers to finance their purchases of goods, merchandise and services
sold by such retailers; and
WHEREAS
Merchant is in the business of selling goods, merchandise and services, and
seeks to sell certain of such goods, merchandise and services on credit to
its
retail customers pursuant to the Program.
NOW,
THEREFORE, in consideration of the covenants and agreements herein contained
and
other good and valuable consideration, the adequacy and sufficiency of which
is
hereby acknowledged, the parties agree as follows:
Agreement
1. The
Program; SCA’s Obligations.
(a) SCA
will
establish the Program for Merchant and provide the Program to Merchant’s retail
customers in order to finance purchases of Merchant’s goods, merchandise and
services by Program customers. In connection therewith, SCA shall lend to
qualifying Program customers under a revolving line of credit agreement (“Credit
Card Account”). Said qualifications will be established by SCA from time to time
in its sole discretion. All Credit Card Accounts are revolving lines of credit,
meaning that the customer is able to make payments and draw against the line
of
credit to make additional authorized purchases from Merchant from time to
time
while the Account is open and valid.
(b) SCA
shall
provide to Merchant application materials in such amounts as are necessary
to
operate the Program. Applications shall be on forms and pursuant to guidelines
approved by SCA in its sole discretion.
(c) SCA
shall
produce and distribute to approved card applicants private label credit cards,
the standard offering of which is a two-color process card; should the Merchant
desire a more elaborate design (subject to approval by SCA in its sole
discretion), SCA reserves the right to pass the cost differential on to the
Merchant, but Merchant will be so advised prior to a production order being
placed.
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(d) SCA
shall
make all credit analyses and determinations with respect to credit applications
for Credit Card Accounts in its sole discretion.
(e) SCA
shall
take commercially reasonable actions necessary or appropriate to assure that
all
aspects of the Program, including, without limitation, application forms,
change
in terms notices, account agreements, billing statements and servicing and
collection procedures, are in material compliance with all applicable laws,
rules and regulations, including, without limitation, the federal
Truth-in-Lending Act, the federal Equal Credit Opportunity Act, the federal
Fair
Credit Reporting Act, the federal Fair Credit Billing Act, the federal
▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and federal regulations concerning the privacy of
customer information, and federal Guidelines for Safeguarding Customer
Information.
(f) SCA
shall
provide Merchant with reports reflecting number of new account and balance
volumes, as well as any additional reports reasonably requested by Merchant,
provided that such reports are permitted under applicable law including,
without
limitation, the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and federal Regulation P. All such
reports will be in a format reasonably acceptable to Merchant.
(g) SCA
shall
pay all postage costs associated with the administration of the
Program.
(h) SCA
will
provide for the inclusion of statement inserts provided by the Merchant,
provided that (i) SCA receives such inserts ten (10) business days before
statement production, and (ii) SCA approves the content of such statements
in
its sole discretion. In the event that the statement insert causes the weight
of
the statement mailing to exceed one (1) ounce, Merchant shall be responsible
for
payment of all excess postage.
2. Processing
Fee.
(a) SCA
agrees to advance funds to Program customers in accordance with the terms
of
their Credit Card Account agreements to finance the purchase of goods,
merchandise and services from Merchant, provided such purchases are evidenced
by
sales slips (“Sales Slips”) processed by Merchant in accordance with procedures
established or to be established by SCA and provided to Merchant. For each
such
purchase, SCA shall fund to Merchant an amount equal to the face amount of
the
Sales Slip, minus a Processing Fee to be determined as follows:
(i) one
and
three quarters percent (1.75%) of the purchase amount for "Standard" purchases
(customers are permitted additional, authorized purchases to be charged on
the
Credit Card Account with minimum/fluctuating payment amounts due monthly
based
on the outstanding balance);
(ii) one
and
ninety-five hundredths percent (1.95%) of the purchase amount for “Promotional
Three Equal Payment” purchases (customers are required to pay three equal
minimum monthly payments with retroactive finance charges assessed to date
of
purchase if the original purchase amount is not paid in full by the end of
the
promotional period);
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(iii) two
percent (2.00%) of the purchase amount for “Promotional Four Equal Payment”
purchases (customers are required to pay four equal minimum monthly payments
with retroactive finance charges assessed to date of purchase if the original
purchase amount is not paid in full by the end of the promotional period);
(iv)
three
and
one-half percent (3.50%) of the purchase amount for “Promotional Six Equal
Payment” purchases (customers are required to pay six equal minimum monthly
payments with retroactive finance charges assessed to date of purchase if
the
original purchase amount is not paid in full by the end of the promotional
period);
(v) five
percent (5.00%) of the purchase amount for “Promotional Eight Equal Payment”
purchases (customers are required to pay eight equal minimum monthly payments
with retroactive finance charges assessed to date of purchase if the original
purchase amount is not paid in full by the end of the promotional period);
(vi)
one
percent (1.00%) of the purchase amount for “Promotional Three Equal Payment”
purchases (customers are required to pay three equal minimum monthly payments
and will pay finance charges at the rate of 15% APR on the unpaid balance
each
month, using the average daily balance method of finance charge
calculation);
(vii) one
and
one half percent (1.50%) of the purchase amount for “Promotional Four Equal
Payment” purchases (customers are required to pay four equal minimum monthly
payments and will pay finance charges at the rate of 15% APR on the unpaid
balance each month, using the average daily balance method of finance charge
calculation);
(viii) one
and
eight-tenths percent (1.80%) of the purchase amount for “Promotional Six Equal
Payment” purchases (customers are required to pay six equal minimum monthly
payments and will pay finance charges at the rate of 15% APR on the unpaid
balance each month, using the average daily balance method of finance charge
calculation); and
(ix) two
and
five-eighths percent (2.625%) of the purchase amount for “Promotional Eight
Equal Payment” purchases (customers are required to pay eight equal minimum
monthly payments and will pay finance charges at the rate of 15% APR on the
unpaid balance each month, using the average daily balance method of finance
charge calculation).
(b) SCA
and
Merchant shall agree in writing to any additions to the promotions listed
in
Section 2(a) above before any such other promotions are offered to customers.
The choice of which promotion to offer to an individual customer will be
at the
option of Merchant, provided however
that SCA
reserves the right, in its sole discretion, to make changes to any terms
with
reasonable notice to the Merchant and customers prior to any change taking
effect.
3. Merchant
Representations and Warranties and Covenants.
(a) The
Merchant represents and warrants that all sales financed by SCA are true
sales
of deliverable and merchantable goods or of services actually performed and
provided
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by
Merchant, including shipping and handling charges, applicable taxes and other
fees imposed by Merchant, and that there are no defenses, credits, set-offs,
deductions or counterclaims of which Merchant is aware, assertable now or
in the
future against the same, by customers or third parties and that Merchant
owns
such goods and proceeds, free and clear of any liens and that the related
Sales
Slips are genuine, valid and subsisting and are free and clear of all liens
and
encumbrances. Should Merchant be deemed to have breached this Agreement and
the
above stated warranty, then in that event Merchant agrees to indemnify SCA
for
any loss sustained by SCA.
(b)
The
Merchant represents and warrants that it shall take all actions necessary
or
appropriate to assure that all aspects of the Program within its control,
including, without limitation, the taking of applications, communications
with
applicants and Program customers, and the processing of Sales Slips are in
compliance with all Program policies and procedures established by SCA and
all
applicable laws, rules and regulations, including, without limitation, the
federal Equal Credit Opportunity Act, and federal Guidelines for Safeguarding
Customer Information.
(c)
It
is
understood that SCA will be the owner of all Credit Card Accounts and related
receivables and, if its ownership is ever called into question, SCA has a
security interest in the goods and merchandise purchased, which security
interest, if any, Merchant hereby grants to SCA. Merchant authorizes SCA
to take
any and all action necessary to perfect this security interest. Merchant
agrees
to maintain for a period of six (6) years electronic files and paper Sales
Slips
containing details of all sales transactions under the Credit Card Accounts
and
transmitted to SCA electronically. Merchant agrees to permit a representative
of
SCA to audit such records of Sales Slips during business hours and at such
time
as shall be mutually convenient for all parties. Merchant further agrees,
either
as a result of a request made by SCA or a request directly made by the holder
of
a Credit Card Account, that Merchant will provide such information regarding
prior sales as may be required in order to comply with the Fair Credit Billing
Act, and that SCA may, at any time and its sole discretion, require that
Merchant submit hard copies of all Sales Slips and other sales documents
to SCA
in addition to electronic transmission.
(d)
It
is
understood that this Agreement covers future advances and after acquired
property with regard to the Credit Card Accounts, and SCA, as the Secured
Party
under this Agreement, has the right to make future advances which will be
secured under this Agreement and any Uniform Commercial Code filings made
in
accordance with this Agreement.
(e) For
face
to face credit card applications, Merchant agrees that it will obtain two
(2)
pieces of acceptable and valid identification documents as set forth in the
Acceptable Identification Documentation list provided by SCA, as amended
from
time to time, when processing an application with SCA. Merchant further agrees
that it will accurately record the type and required information from said
acceptable and valid identification, and that it will not process an application
where such identification appears to be fraudulent or has expired. Additionally,
Merchant agrees to review and compare the photographs and signatures that
appear
on such acceptable and valid identification to ensure that they are similar
in
appearance to the applicant’s appearance and applicant’s signature on the
application.
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Additionally,
Merchant
agrees
to the following procedure for telephone credit card applications:
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Record
all phones calls
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·
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Verify
applicants name, street address, city, state and date of birth
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·
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Obtain
applicants social security number
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(f) For
face
to face credit applications, Merchant agrees that it will store all completed
customer applications, both approved and declined, in a secure location until
such time as the applications are forwarded to SCA, said forwarding to take
place no less frequently than once per month.
(g) Merchant
consents to SCA personnel monitoring and/or recording telephone conversations
between Merchant and SCA personnel in order to evaluate the quality of SCA’s
services.
4. Accounts
Non-Recourse.
SCA
agrees that it will bear any and all losses sustained on Credit Card Accounts
and will not have any recourse against Merchant, except that SCA may chargeback
to Merchant any transaction generated under Credit Card Accounts which SCA
reasonably deems to be uncollectible as a result of unresolved customer
disputes, improper sales floor procedures, or a breach of Merchant’s
representations and warranties under this Agreement (“Chargeback”).
Improper
Sales Floor procedures include, but are not limited to:
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(i)
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the
Sales Slip and Application are not completed per SCA guidelines.
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(ii)
the
Sales
Slip is a duplicate of a transaction previously paid.
(iii) the
price
of the goods or services shown on the Sales Slip differs from the amount
shown
on the receipt delivered to the Cardholder at the time of the transaction.
(iv)
Merchant
did not obtain authorization from SCA for the transaction represented by
the
Sales Slip.
(v)
SCA
determines that Merchant has violated or not complied with any term, condition,
covenant, warranty, or other provision of this Agreement or any other agreement
between the parties, or any of SCA’s procedures, in connection with the Sales
Slip or the transaction to which it relates.
(vi)
SCA
determines that the Sales Slip is fraudulent or that the related transaction
is
not a bona fide transaction in Merchant’s ordinary course of business, or is
subject to any claim of illegality, cancellation, rescission, avoidance,
or
offset for any reason whatsoever, including without limitation negligence,
fraud, or dishonesty on the part of Merchant or any of its agents or employees.
(viii) SCA
did
not receive an Application as required.
(ix)
SCA
did
not receive a copy of the Sales Slip as required.
(x)
the
Sales
Slip is submitted prior to acceptance of merchandise by the Customer.
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(xi)
merchandise is shipped to an address other than the billing address and the
Cardholder disputes delivery of the merchandise.
(xii)
merchandise valued in excess of $1,000 is shipped or delivered without requiring
and securing a signed receipt from Customer and the Cardholder disputes delivery
of the merchandise.
Unresolved
customer disputes include, but are not limited to:
(i)
Cardholder
claims that they have not been satisfied with a purchase or service that
emanated from the Merchant.
(ii)
the
Cardholder disputes the execution of the Sales Slip, or the sale, delivery,
quality, or performance of the goods or services.
(iii)
the
Cardholder contends that it did not authorize the transaction represented
by the
Sales Slip or did not authorize the transaction in the amount shown on the
Sales
Slip.
(iv)
the
Cardholder alleges that a credit adjustment was requested within the parameters
of Merchant’s documentable return policies and refused, or that a credit
adjustment was issued by Merchant but SCA did not receive the
credit.
Merchant
shall be fully responsible for Chargebacks upon SCA’s determination and notice
pursuant to Section 5 hereof.
5. Calculation
of Chargebacks.
SCA may
determine at any time in its sole reasonable opinion that a transaction should
be classified as a Chargeback. Upon appropriate notice from SCA that a
transaction is a Chargeback, Merchant shall pay SCA the amount of the Sales
Slip
plus all added fees including, but not limited to, finance charges, late
fees,
NSF fees and the like, less any amounts received by SCA on account of such
transaction, and Merchant shall thereafter own such Chargeback, and, as such,
shall be entitled to pursue any collection efforts the Merchant deems necessary
and appropriate, with any subsequent recoveries as a result of said collection
efforts being the sole property of the Merchant.
6. Payments
for Chargebacks.
Payment
to SCA in accordance with Sections 4 and 5 herein shall be made by deduction
against monies due from SCA to Merchant under this Agreement. Any balance
which
may be still due and owing to SCA after accounting for such set-off shall
be
immediately payable by Merchant.
7. SCA
Authority regarding Chargebacks.
In the
event Merchant fails to make prompt payment pursuant to the demand of SCA,
as
provided in Sections 4, 5 and 6 herein, SCA shall have the right to litigate,
extend the time of payment, compromise or settle any Chargebacks, or to set-off
any amounts owed to SCA pursuant to Section 8 herein. Any such action by
SCA
shall not be deemed to be a waiver of any rights of SCA against
Merchant.
8. Reserve.
In
addition to the agreed rates of discount set forth in Section 2 hereof, and
pursuant to the Merchant’s Chargeback obligations as defined in Sections 4, 5
and 6 hereof, SCA shall deduct from the amount of the Sales Slips of current
Credit Card Accounts in the ordinary course of business an additional sum
of one
half percent (0.50%) (the “Reserve”) which
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SCA
shall
hold cumulatively. It is further agreed that SCA shall reconcile said Reserve
to
an amount equal to three percent (3.00%) of
the
outstanding Credit Card Account balances then being owned by SCA, at the
end of
each calendar quarter and such Reserve account shall not be diminished below
three percent (3.00%) of such balances. In the event that there exists an
overage in the Reserve at the point(s) of reconciliation, SCA will return
to the
Merchant, after deducting any sum that may be due SCA from said Reserves,
the
excess thereof, if any. In the event that there is a deficit in the Reserve
at
the point(s) of reconciliation, the Merchant shall remit the amount of said
deficit to SCA immediately upon notification. Within 15 days of each calendar
quarter, SCA will pay the Merchant interest on the Reserve at a rate that
is one
percent (1.00%) below the domestic Prime Rate as published in The Wall Street
Journal on Friday of each full calendar week.
SCA
will
hold the Reserve for as long as the Program is ongoing. In the event that
the
Program is terminated for any reason by either party as provided for herein,
SCA
will continue to hold the Reserve until such time as the aggregate outstanding
balance of all Credit Card Accounts is zero. SCA may, at its sole option,
return
the Reserve in partial settlements, refunding to the Merchant any excess
in the
Reserve above the actual total amount of outstanding Credit Card Accounts
after
termination of this Agreement.
9. SCA
Right of Set-Off and Collateral Security.
Merchant
hereby grants to SCA the right of set-off. SCA may apply any monies due and
owing to Merchant, or any monies in its possession belonging to Merchant,
against monies which become due and owing to SCA by Merchant pursuant to
any of
the provisions of this Agreement. Merchant hereby grants to SCA a
contractual possessory security interest in, and hereby assigns, conveys,
delivers, pledges, and transfers to SCA all Merchant’s right, title and interest
in and to, all deposit accounts Merchant may open in the future at TD Banknorth,
N.A.
10. Handling
of Customer Payments.
(a) In
connection with the Program, SCA will send monthly billing statements to
the
account holder(s), which statements will contain an envelope addressed to
SCA’s
lockbox. However, in the event that Merchant receives any payments on Credit
Card Accounts, it will promptly forward such payments to SCA in the form
received (or by check covering multiple payments), or it shall electronically
advise SCA of the receipt thereof. If a notification of payments is transmitted
electronically to SCA, SCA shall deduct the total amount of said payments
from
monies owed to Merchant. In the event that the total amount of said payments
exceeds monies owed to Merchant, then, in that case, Merchant shall make
payment
to SCA within five (5) days after notification that such a situation exists.
Even if a Credit Card Account holder’s payment check is made payable to the
order of Merchant, Merchant acknowledges that it holds such funds solely
for the
benefit of SCA. Merchant assumes all risk of loss of said funds while in
Merchant’s possession and in transit to SCA. In the event that Merchant fails to
pay such amount to SCA, then SCA may, at its discretion exercise any and
all
rights of set-off provided for herein.
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(b) Merchant
irrevocably constitutes and appoints SCA, a division of TD Banknorth, N.A.
as
its attorney-in-fact to endorse the name of Merchant on any payments received
by
SCA on Credit Card Accounts. In the event that there are filings on Merchant’s
behalf of any forms and documents required by the Uniform Commercial Code,
Merchant agrees that it will sign said forms and documents on a timely basis,
or
will instead allow SCA to sign said forms and documents on its
behalf.
11. Returns.
Merchant
may, in its sole discretion, accept returns of products under a Credit Card
Account and shall advise SCA within twenty-four (24) hours of granting any
such
return. Thereupon, SCA will credit the appropriate Credit Card Account for
the
charge imposed for such returned products. SCA may deduct the amount paid
to
Merchant for the purchases of such returned goods or merchandise from other
monies, if any, due Merchant. If there are no monies due from SCA to Merchant,
then in that event Merchant shall forthwith upon notice pay such amount to
SCA.
In the event that Merchant fails to pay such amount to SCA, then SCA may,
at its
discretion exercise any and all rights of set-off provided for herein. Merchant
acknowledges that it does not have the right to make any adjustments to Credit
Card Accounts with respect to any fees or charges imposed by SCA.
12. Settlement.
Settlement of monies due the Merchant for Sales Slips transmitted to SCA
shall
be made on a daily basis, Monday through Friday, not later than twenty-four
(24)
hours after the file is received by SCA, except if the file is received after
3
PM (Eastern Time) or if one of those days is a national holiday, in which
case
settlement will be made on the following business day. Settlement will be
transmitted electronically through the Automated Clearing House to the
Merchant’s designated account or another method if mutually agreed to by both
parties.
13. Restrictions
on Competitor Financing.
Merchant
agrees, during the term of this Agreement, that it will not provide or arrange
for any other competing retail private label credit card charge program.
It is
understood that this Section shall not be deemed to include universal credit
card plans such as, but not limited to, Visa, MasterCard, American Express,
Diners Club, ▇▇▇▇▇ ▇▇▇▇▇▇▇ and Discover Card.
14. Submission
of Financial Statements.
Merchant
agrees to provide SCA with copies of its annual financial statements and
annual
reports within one hundred-eighty (180) days after each fiscal year end.
Filing
with the Securities and Exchange Commission is deemed delivery.
15. Merchant
Default.
Merchant
shall be in default under this Agreement (“Merchant Default”) if: (a) a petition
in bankruptcy is filed by or against Merchant and is not dismissed within
sixty
(60) days; (b) Merchant makes or offers to make an assignment or compromise
for
the benefit of its creditors; (c) Merchant ceases to do business as a going
concern (unless cessation is the result of Merchant being acquired by another
entity that will be continuing the business); (d) a receiver or trustee of
Merchant’s assets is appointed; (e) Merchant fails to forward any payments on
Accounts it receives as provided for in this Agreement; or (f) Merchant
materially breaches any obligation under this Agreement and fails to cure
such
breach within ten (10) days after written notice from SCA specifying the
nature
of such breach, or if
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said
breach is of such nature that cannot be cured within ten (10) days, Merchant
fails to commence actions and diligently work toward effecting a cure to
SCA’s
satisfaction, determined in SCA’s sole discretion.
16. Term
of Agreement.
Either
party may terminate this Agreement immediately upon the occurrence of an
event
of default by the other party. Unless either party terminates this Agreement
upon a default by the other party, this Agreement shall remain in effect
through
December 2, 2007 (“Present Term”) and will automatically renew for an additional
year at the end of the Present Term and each subsequent anniversary unless
either party has given written notice of non-renewal at least ninety (90)
days
prior to the renewal date. Subject to Section 15, upon termination of this
Agreement for any reason, including as a result of either SCA or Merchant
ceasing to do business, the obligations of both parties, including without
limitation the obligations under Section 4, shall continue with respect to
all
Credit Card Account balances arising during the life of this Agreement.
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17.
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Confidential
Information.
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Notwithstanding
anything to the contrary contained in section 17, it is expressly understood
that merchant may use Cardholders personal information in the course of
conducting it's day to day business requirement. Such use includes but is
not
limited to: (a) sharing information with any third party for the purpose
of
building a marketing or shared coop database, (b) List exchanges, (C) List
brokerage or list sale. It is further understood that Merchant shall not
disclose any personal financial information, including social security numbers,
account balances, or any other credit related confidential information.
(a)
Except as required by law, court of competent jurisdiction or regulatory
body,
SCA and Merchant shall keep strictly confidential and shall not disclose,
copy
or use any Confidential Information, except to implement the provisions of
this
Agreement. “Confidential Information” shall mean the following: (a) Cardholder
names, account balances, addresses and any non-public personal information
of
customers as defined under federal Regulation P; (b) information regarding
the Program, and SCA’s customers, pricing policies, methods of operation,
proprietary computer programs, sales, products, profits, costs, markets,
key
personnel, product applications and technical processes; and (c) information
disclosed by the parties in writing or machine readable form and the writing
or
machine readable form has been marked "Proprietary," "Confidential," or in
any
similar manner which gives notice of its confidential nature. It is understood
that the aforesaid will in no way limit SCA from providing such information
as
is required relating to the customers, their balances and their addresses,
in
order for SCA to provide the appropriate credit and collection analysis and
services as are required of it under this Agreement, including, but not limited
to, submitting customer names, addresses and balances to credit bureaus for
credit and collection purposes, and the like. Confidential Information may
be
disclosed pursuant to a subpoena issued by any court or government agency,
and
may also be disclosed to any governmental agency or regulators of TD Banknorth,
N.A. Nothing in this Section 17 shall preclude SCA from disclosing Confidential
Information to any state or federal body or agency with regulatory authority
over TD Banknorth, N.A. or Merchant.
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(b)
Without limiting the foregoing, Merchant agrees as follows: All capitalized
terms used in this subsection and not otherwise defined shall have the meanings
set forth in the Office of the Comptroller of the Currency’s “Privacy of
Consumer Financial Information” Regulation (12 C.F.R. Part 40), as amended from
time to time (the “Privacy Regulation”), and the “Interagency Guidelines
Establishing Standards for Safeguarding Customer Information” (12 C.F.R. Part
30), as amended from time to time (the “Safeguarding Guidelines”), issued
pursuant to Section 504 of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act (15 U.S.C. 6801 et
seq.).
Merchant acknowledges that the Privacy Regulation and Safeguarding Guidelines
govern the use, disclosure, privacy and security of Nonpublic Personal
Information about consumers. Merchant hereby represents and warrants with
respect to any Nonpublic Personal Information obtained by Merchant in connection
with this Agreement that it shall:
(i) Comply
with the terms and provisions of the Privacy Regulation, including, without
limitation, the provisions regarding the sharing of Nonpublic Personal
Information (as defined in the Privacy Regulation);
(ii) Comply
with the terms and provisions of the Safeguarding Guidelines, including,
without
limitation, adopting, implementing and maintaining written policies and
procedures to (A) ensure the security and confidentiality of Nonpublic Personal
Information; (B) protect against any anticipated threats or hazards to the
security or integrity of the Nonpublic Personal Information; and (C) protect
against unauthorized access to or use of the Nonpublic Personal Information
that
could result in substantial harm or inconvenience to any consumer;
(iii) Not
disclose or use any Nonpublic Personal Information except to perform its
obligations under this Agreement, or as otherwise permitted by the Privacy
Regulation and other applicable laws;
(iv) Not
make
any changes to its security measures that would increase the risk of any
unauthorized access;
(v) Not
disclose any Nonpublic Personal Information to any other entity;
(vi) In
the
event Merchant knows or reasonably believes that there has been any unauthorized
access (or attempted unauthorized access) to Nonpublic Personal Information
in
the possession or control of merchant that compromises (or threatens to
compromise) the security, confidentiality or integrity of such Nonpublic
Personal Information:
(A) promptly
notify SCA of such unauthorized access or attempted unauthorized
access;
(B) identify
to SCA (at no cost to SCA) what specific Nonpublic Personal Information may
have
been accessed, including (if applicable) the name and account number of each
affected consumer;
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(C) take
reasonable steps to remedy the circumstances that permitted any such
unauthorized access to occur; and
(D) take
reasonable steps to prohibit further disclosure of Proprietary
Information.
18. Customer
Solicitations.
SCA
shall not, except as expressly permitted in this Agreement, send any material,
information or documents to any customers without the express prior written
consent of the Merchant, except for any materials, information or documents
relating solely to the servicing of the Credit Card Accounts, including,
but not
limited to, collection letters and compliance notifications.
19. Promotional
Allowance.
On an
ongoing basis during each Contract Year, SCA will make available to the Merchant
an amount equal to one half percent (0.50%) percent of the prior Contract
Year’s
net sales volume defined as gross sales less returns (“Promotional Allowance”),
such Promotional Allowance to be used specifically by the Merchant toward
the
marketing of the Program. However, in the present Contract Year which ends
on
December 2, 2006, SCA agrees to provide the Merchant with a Promotional
Allowance of fifteen thousand Dollars ($15,000). The Merchant understands
that it must receive pre-approval of all marketing initiatives and materials
contemplated prior to submitting an invoice for reimbursement to SCA.
There will be no carry over of any unused promotional funds at the end of
each
Contract Year. No more than ten percent (10.0%) of each Contract Year’s
Promotional Allowance may be used to offset the cost of print advertisements,
including, but not limited to, newspaper advertisements, newspaper inserts,
catalogs and the like. Merchant represents and warrants that is shall abide
by
the promotional guidelines provided by SCA, as amended from time to
time.
20. Merchant
Marks.
Merchant
grants to SCA the right, license and privilege to use Merchant’s trademarks,
retail marks and service marks (“Merchant Marks”) on Program materials,
specifically including, but not limited to, application forms, periodic
statements and other Program related communications, as determined by SCA
in its
commercially reasonable discretion. SCA shall use the Merchant Marks solely
in
the forms and formats approved by Merchant prior to any such use.
21. Governing
Law; Jurisdiction/Venue; Waiver of Jury Trial.
(a)
This
Agreement shall be governed by, and construed and enforced in accordance
with
the laws of the State of New Jersey. In the event of any controversy, claim
or
dispute between the parties arising out of or relating to this Agreement,
such
controversy, claim or dispute shall be resolved in a state or federal court
of
the States of New Jersey, and the parties hereby irrevocably consent to the
jurisdiction and venue of such courts.
(b) Merchant
and SCA voluntarily and irrevocably consent and agree that all claims for
any
special, consequential, incidental, indirect, punitive or exemplary damages
arising out of or relating to this Agreement, or for the other’s attorneys’
fees, are waived.
(c) MERCHANT
AND SCA HEREBY VOLUNTARILY AND IRREVOCABLY WAIVE ANY RIGHT TO A TRIAL BY
JURY IN
ANY DISPUTE ARISING
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PURSUANT
TO THE TRANSACTIONS, PAST, PRESENT AND FUTURE, UNDER THIS
AGREEMENT.
22. Restrictions
on Assignment.
This
Agreement is not assignable by either party without the prior written approval
of the other party. In the event of an acquisition of Merchant or a majority
of
its assets by merger, consolidation, asset purchase or the like, SCA shall
use
its best efforts to reach an agreement for the continuation of the Program
with
the acquirer. It
is
understood that on July 14, 2006, the Merchant completed a reverse acquisition
with Simplagene USA, Inc.
23. Limited
Invalidity.
The fact
that any clause or paragraph in this Agreement may be determined to be
unconstitutional, illegal, or otherwise ineffective shall in no way affect
any
other clause or paragraph of this Agreement, which shall remain in full legal
force and effect.
24. Verifications
of Sales.
SCA may,
without notice, make test verifications of Merchant’s sales under Credit Card
Accounts. The test verification will be carried out by means of a letter
sent to
the account holders asking them to confirm the sale.
25. Capacity;
Authority; Validity.
Merchant represents and warrants that it has all necessary corporate power
and
authority to enter into this Agreement and that consummation of the transactions
contemplated hereby have been duly and validly authorized by all necessary
corporate action. This Agreement, when executed, constitutes the valid and
binding obligation of Merchant, enforceable in accordance with its terms.
Neither execution of this Agreement nor the consummation of the transactions
contemplated hereby will (i) conflict with, result in the breach of, constitute
a default under, or accelerate the performance required by, the terms of
any
order, law, regulation, contract, instrument or commitment to which Merchant
is
a party or by which it is bound, (ii) violate the articles of incorporation
or
bylaws or any other equivalent organizational document of Merchant, (iii)
require any consent, approval, authorization or filing under any law,
regulation, judgment, order, writ, decree, permit, license or agreement to
which
Merchant is a party or by which it is bound or to which it is subject, or
(iv)
require the consent or approval of any other party to any material contract
to
which Merchant is a party.
26. Notices. All
notices and other communications required or permitted to be given to a party
pursuant to this Agreement shall be in writing, and shall be deemed duly
given
(i) on the date delivered if personally delivered, (ii) on the date sent
by
telecopier with automatic confirmation by the transmitting machine showing
the
proper number of pages were transmitted without error, (iii) on the business
day
after being sent by overnight courier service which utilizes a written form
of
receipt for next day or next business day delivery, or (iv) two (2) business
days after mailing, if mailed by United States postage-prepaid certified
or
registered mail, return receipt requested, in each case addressed to the
applicable party at the address set forth on the first page of this Agreement;
provided that a party hereto may change its address for receiving notice
by the
proper giving of notice hereunder. In addition, copies of all notices sent
to
SCA shall also be provided to TD Banknorth Legal Department, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇., ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇.
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27. Waiver.
Waiver
by either party of any breach of this Agreement, or of any portion or provisions
thereof, shall not be construed as a waiver of any subsequent or other breach;
nor shall failure of either party to exercise any right, remedy, privilege
or
option granted to it under this Agreement operate as a waiver thereof or
give
rise to any estoppel in favor of the other party. No waiver by either party
shall be effective unless it is a duly authorized and signed writing, and
then
only to the extent specifically stated. All rights, remedies, and privileges
of
either party under this Agreement are cumulative and not alternative and
may be
exercised concurrently or seriatim, and are in addition to and not in lieu
of
any and all rights and remedies of either party at law, in equity, under
statute, or otherwise.
28.
Indemnification.
SCA and
Merchant agree to defend, indemnify and hold harmless the other from any
actual
damages that may arise for all actual or alleged violations of any local,
state
or federal consumer protection law or regulation by virtue of the other’s
alleged acts or omissions which occur after the effective date of this
Agreement.
29.
Entire
Agreement.
This
Agreement incorporates the entire understanding of the parties and supersedes
any and all existing agreements, whether written or oral, with respect to
the
subject matter hereof, and no representation, warranty or agreement not set
forth herein or in a writing delivered pursuant hereto shall be binding on
either party.
30.
Captions;
Counterparts.
The
captions in this Agreement are for convenience only and shall not be considered
a part of or affect the construction or interpretation of any provision of
this
Agreement. This Agreement may be executed in counterparts, each of which
shall
be an original, but all of which together shall constitute one and the same
instrument.
31.
Amendments
and Waivers.
None of
the terms or provisions of this Agreement may be waived, altered, modified
or
amended except by an instrument in writing duly executed by both
parties.
32.
Further
Assurances.
On and
after the date hereof, each party shall, at the other party’s request, execute,
acknowledge and deliver all such acknowledgments and other instruments as
may be
reasonably necessary or appropriate to fully and effectively carry out the
transactions contemplated hereby.
Remainder
of Page Intentionally Left Blank
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IN
WITNESS WHEREOF,
the
parties have executed and delivered this Agreement on the date first above
written.
New
Colorado Prime Holdings, Inc. Shoppers
Charge Accounts Co.,
D/B/A
Colorado Prime Foods and
a
division of TD Banknorth,
N.A.
DineWise
BY:
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇ BY:
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇
▇▇▇▇▇▇▇ Name:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VP-CFO Title:
Division President
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