EXHIBIT 10.12
GLOBAL MASTER SERVICE AGREEMENT
Customer:
Name: Digital Courier Technologies, Inc. Phone:
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City: Park City State: Utah Zip: 84060
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Subject to the terms and conditions of this Service Agreement and such exhibits
or attachments as may now or hereafter be attached hereto, please enter my order
for Global Payment Systems LLC's ("Global") electronic data processing Services
or Systems (collectively the "Services") for an initial term of five (5) years.
This agreement replaces any prior agreement between these two companies or their
predecessor companies.
Customer:
Digital Courier Technologies, Inc. Global Payment Systems LLC
By: /s/ James Egide By: /s/ Suellyn P. Tomay
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Typed Name: James Egide Typed Name: Suellyn P. Tomay
Title: Chief Executive Officer Title: Vice President & Acting
General Counsel
Date: 5-31-2000O Date:
Address: Address:
P.O. Box 8000
136 Heber Ave., Suite 204 Four Corporate Square
Park City, Utah Atlanta, GA 30329-2010
Attention: James Egide Attention: Office of Corporate
Secretary
TERMS AND CONDITIONS
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1. GLOBAL SERVICES: According to the terms of this Agreement ("Agreement"),
Global will furnish Customer with the Services described in Exhibit A, Service
Description, attached hereto and incorporated herein by reference. Additional
requested Services, if available, will be furnished to Customer under the
general terms and conditions of this Agreement and in accordance with pricing
established by Global for such additional Services. Customer will purchase all
of the requirements of Customer for all information technology services and
applications described herein.
2. CHARGES: Charges for the Services shall be as set forth in Exhibit B, Service
Pricing Schedule. The amount of usage of Services to be paid for by Customer
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shall be that amount recorded by Global's computer system. Charges for requested
Services for which there is no published rate shall, in the absence of prior
written agreement, be at a reasonable rate as determined by Global. In addition,
Customer will be charged an amount equal to any taxes, however designated,
levied or based on any of the above referred to charges or Services, including
State and local taxes paid or payable by Global, excluding any federal, State of
local taxes based on Global's net income.
Customer hereby authorizes Global to charge Customer's checking account monthly
for all charges incurred by Customer, including any charges incurred by Global
on Customer's behalf, for Customer's use of the Services as provided for in this
Agreement. Prior to the account being debited, Global will send Customer a
statement detailing the amount to be debited to Customer's account. If
Customer's checking account contains insufficient funds to accommodate such
debit, Customer authorizes Global to charge its checking account a one and
one-half percent (1 %) per month service charge on all amounts that are not paid
on the due date. All payments shall be made in United States dollars. In the
event that any amount due hereunder is not timely paid as provided herein,
Global may, in addition to any other right or remedy which it may have under
this Agreement or at law, terminate this Agreement and Customer's use of the
Services if Customer does not effect payment in full within ten (10) days of
Global's written demand therefor. Customer agrees to reimburse Global for all
costs and expenses, including reasonable attorney's fees, incurred by Global in
enforcing collection of any moneys due it under this Agreement.
3. TERM AND TERMINATION:
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a. This Agreement shall remain in full force and effect for the initial term set
forth on the cover page, beginning upon the date Global executes the
Agreement, and shall be automatically extended for successive one (1) year
periods on the same terms and conditions expressed herein, or as may be
amended, unless either party gives the other party written notice of
termination at least one hundred and eighty (180) days prior to the
expiration of the initial term or any extensions or renewals thereof.
Termination of this Agreement shall not terminate Customer's obligation to
pay Global for all services performed under the Agreement prior to
discontinuance of performance by Global due to termination.
b. Except as provided in Paragraph 2 above, in the event that either party
hereto fails in the performance of its obligations hereunder or breaches the
terms or conditions hereof, the other party may, at its option, give written
notice to the party which has failed to perform or has breached this
Agreement of its intention to terminate this Agreement unless such breach or
failure in performance is remedied within sixty (60) days of such notice.
Failure to remedy such a breach shall make this Agreement terminable, at the
option of the aggrieved party, at the end of such sixty (60) day period
unless notification is withdrawn.
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c. In the event that Customer becomes or is declared insolvent or bankrupt, is
the subject of any proceedings related to its liquidation, insolvency, or for
the appointment of a receiver, conservator, or similar officer for it, makes
an assignment for the benefit of all or substantially all of its creditors,
or enters into an agreement for the composition, extension, or readjustment
of all or substantially all of its obligations, then the liquidator, trustee,
receiver, conservator, new owner, manager, or other agent or representative
shall have sixty (60) days to notify Global that it is terminating the
Agreement as of a date within such sixty (60) day period. If Global is not so
notified, this Agreement shall not be terminated, but shall continue on all
of the terms and conditions stated herein, including, without limitation, the
payment terms specified in Section 2. All Services provided to Customer by
Global pursuant to this Agreement shall be deemed to be administrative
expenses in the event of Customer's insolvency or bankruptcy or the
appointment of a receiver, conservator, or similar officer for Customer.
d. In the event that Global terminates this Agreement pursuant to Sections 3(b)
or 3(c) hereof or that Customer terminates this Agreement in breach of
Section 3(a) hereof, the parties agree that Global's damages resulting from
the breach will be difficult if not impossible to ascertain. Such damages may
include without limitation deconversion costs, personnel and administrative
costs, dedicated computer time, equipment, office space, supplies, printing
and microfiche costs, telecommunications, audit costs, training costs,
software, damages to contracts and leases with third parties, lost profits,
and maintenance costs.
If Global terminates this Agreement pursuant to Section 3(b) or 3(c) hereof
or if Customer terminates this Agreement in breach of Section 3(a) hereof,
then in lieu of all other damages to which Global may be entitled, except for
payment obligations for Services already provided hereunder (or that Global
may continue to provide), which shall be an additional cost, Customer shall
remit to Global within thirty (30) days of the date of the termination a
termination fee equal to the sum of the following:
(i) One Hundred percent (100%) of the costs (both out-of-pocket and
internal) of Global incurred in connection with such termination; and
(ii) Fifty percent (50%) of the revenues Global would have received in the
absence of such termination, which revenues shall be calculated by
multiplying (A) the average of the monthly revenues received by Global
pursuant to this Agreement in the preceding six (6) months, by (B) the
number of months remaining before the expiration date of the then
current term.
The termination fees provided for herein are hereby agreed by the parties
hereto to be a reasonable amount of liquidated damages to compensate Global
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for its termination expenses, lost profits, and all other damages under the
circumstances in which such termination fees would be payable.
4. CHANGE OF CHARGES: Global shall have the right to change the prices for any
of the Services at any time on or after the expiration of the first year's
anniversary date of this Agreement upon not less than thirty (30) days prior
written notice to Customer. Such new price shall be guaranteed to remain at the
same level for a period of two (2) years from the effective date of such change.
Notwithstanding the above requirements, Global shall have the right to increase
the fees and charges paid by Customer to offset any increase in rates charged by
the communications common carriers and/or equipment providers. Any such increase
shall become effective on the same day as the increase in rates charged by the
communications common carrier and/or equipment providers becomes effective.
Further notwithstanding the above requirements, Global shall have the right to
increase such fees and charges to offset any increase to Global in the costs of
providing the Services hereunder or if any change in the rules, regulations or
operating procedures of any payment system sponsoring organization (including,
without limitation, MasterCard, VISA, Diner's, American Express, Discover or
JCB) or any cognizant Federal, State or local governmental agency or regulatory
authority results in such cost increase. Any such increase shall become
effective as of the date on which Global notifies Customer of such increase.
5. USE OF THE SERVICES: Customer agrees to utilize the Services in accordance
with this Agreement, its exhibits or attachments and Global's instructions and
specifications and to provide Global with the necessary data in the proper
format to enable Global to properly furnish the Services. Customer agrees to
provide Global with at least sixty (60) days written notice of any proposed
changes in method of employment of the Services which could significantly alter
the volume.
Customer agrees to comply with all operating instructions pertaining to the
Services as issued by Global from time to time. In order to continuously improve
the efficiency and quality of the Services, Global reserves the right to make
such software, hardware, and operational changes as it shall reasonably deem
necessary and Customer shall be notified of any changes affecting the Services
to Customer. Customer acknowledges that Global shall provide the Services using
such software, whether owned by Global or others, as Global in its sole
discretion determines appropriate.
Customer is solely responsible for providing, installing, and maintaining all
telecommunications lines and equipment, including terminals and control units,
data lines, and any other equipment as Global may require to perform services
hereunder. Customer shall bear the complete responsibility including, but not
limited to, the costs of procurement, operation, installation, and maintenance
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of such equipment, although Global may, at Customer's request, advise Customer
in the selection process. If authorized by Customer, Global shall arrange for
and coordinate installation of such equipment in conjunction with Customer's
conversion to Global's Systems for a mutually agreeable fee. All equipment
provided by Customer shall be acceptable to Global.
Customer will distribute, inspect, and review all reports created from
information transmitted or delivered by Global and reject all incorrect reports
within three (3) business days after receipt thereof for daily reports and
within five (5) business days after receipt thereof for other than daily
reports. Notwithstanding the foregoing time limits, Customer shall promptly
inform Global of any errors, deficiencies, or irregularities reflected in any
such statements that Customer discovers. Failure to so reject any report
collected from such information shall constitute acceptance thereof.
Customer's electronic data processing system, if any, shall be administered in a
manner compatible with Global's Systems. Customer will cooperate with Global to
accommodate any reasonable changes or modifications to Global's Systems which
may occur from time to time.
Customer will (i) comply with (A) all applicable state and federal laws and
regulations `and shall be solely responsible for compliance with Regulation Z,
Fair Credit Reporting Act, or any other state or federal law or regulation
governing Customer's relationship with its cardholders or merchants (B)
applicable by-laws and regulations of VISA U.S.A., Inc., Visa International and
MasterCard International Incorporated, and (C) Global's operating policies and
procedures set forth in the documentation or otherwise, as the same may be
modified from time to time by Global, (ii) use written material, advice and
technical information provided by Global in connection with the Services, (iii)
effect all collections of its accounts, (iv) bear all losses from uncollected
accounts, all costs or expenses incurred in connection with the collection of
accounts, and costs or expenses incurred in connection with accounts with
respect to which there is any controversy, claim, or dispute, and (v) arrange
for such action as may be appropriate or necessary because of misuse or abuse in
the use of any account opened or accepted by it, and other terms and conditions
applicable to transactions effected through it.
Customer is responsible for the quality and accuracy of all data input to Global
and will insure that such data is organized in the proper input sequence and
format as specified by Global. Any data submitted by Customer for processing
which is incorrect, illegible, or otherwise not in proper form may be, at
Global's option, returned to Customer for correction before processing. In the
event Customer fails to furnish its data to Global in the form and in accordance
with the schedule agreed upon, Global will use all reasonable efforts to
reschedule and process the work as promptly as possible, it being understood
that all expenses to Global occasioned by such failure will be borne by
Customer.
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6. OWNERSHIP OF PROGRAMS: Customer agrees that the Systems (which are defined as
the computer programs, including without limitation, software, firmware,
application programs, operating systems, files, and utilities and (2) supporting
documentation for such computer programs, including without limitation, input
and output formats, program listings, narrative descriptions, operating
instructions and programming instructions, and (3) any tangible media upon which
such programs are recorded, including without limitation, chips, tapes, disks,
any diskettes and which includes all changes, additions and/or enhancements to
any of the foregoing) supplied or made available to it by Global or used by
Global to provide the Services are the exclusive property of Global, its agents,
suppliers, or contractors. Customer further agrees that the Systems or any part
thereof will not be copied or used in any manner or for any purpose other than
that specifically authorized by this Agreement and shall not be used in
connection with the systems or services of any entity other than Global. The
Systems and all computer tapes, disks, programs, specifications and enhancements
developed in connection with the Services are and shall remain at all times
during and after the term of this Agreement the exclusive property of Global.
Customer hereby assigns all its rights, title and interest, if any, in such
tapes, disks, programs, specifications and enhancements to Global. This clause
shall survive the termination of this Agreement.
7. LIMITATION OF LIABILITY:
a. Global shall not be liable for failure to provide the Services if such
failure is due to any cause or condition beyond its reasonable control. Such
causes or conditions shall include but shall not be limited to, acts of God
or of the public enemy, acts of the Government in either its sovereign or
contractual capacity, fires, floods, epidemics, quarantine restrictions,
strikes, shortages of labor or materials, freight embargoes, unusually severe
weather, electrical power failures, telecommunication failures, unavoidable
delays, or other similar causes beyond Global's control and Global shall have
no liability for losses, expenses or damages, ordinary, special or
consequential resulting directly or indirectly from such causes. If Global's
failure to provide the Services is caused by the default of a subcontractor,
and if such default arises out of causes beyond the control of both Global
and the subcontractor, Global shall not be liable unless the supplies or
Services to be furnished by the subcontractor were obtainable from other
sources on commercially reasonable terms and in sufficient time to permit
Global to fulfill its obligations hereunder.
b. Global agrees to use its commercially reasonable efforts at all times to
provide prompt and efficient services; however, Global makes no warranties or
representations regarding the Services except as specifically stated in this
Paragraph 7.b. Global shall use due care in providing the Services hereunder
and agrees that it will, at its expense, correct any errors which are due
solely to malfunction of Global's computers, operating systems or programs,
or errors by Global's employees or agents. Correction shall be limited to
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rerunning of the job or jobs and/or recreating of data or program files.
Global shall not be responsible in any manner for errors or failures of or
errors in proprietary systems and programs other than those of Global, nor
shall Global be liable for errors or failures of Customer's software or
operational systems. THIS WARRANTY IS EXCLUSIVE AND IS IN LIEU OF ALL OTHER
WARRANTIES, AND CUSTOMER HEREBY WAIVES ALL OTHER WARRANTIES, EXPRESS,
IMPLIED, OR STATUTORY INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR USE FOR A PARTICULAR PURPOSE. Should there be
any failure in performance or errors or omissions with respect to the
information being transmitted, Global's liability shall be limited to using
commercially reasonable efforts to correct such failure in performance or
errors or omissions. In no event, except as specifically set forth herein,
shall Global be liable to Customer or any third parties (including Customer's
clients) for any claim, loss or damage, ordinary, special or consequential,
or otherwise, even if Global has been advised of the possibility of such
damage.
Due to the nature of the services being performed by Global, it is agreed
that in no event will Global be liable for any claim, loss, liability,
correction, cost, damage or expense caused by Global's performance or failure
to perform hereunder which is not reported by Customer within thirty (30)
days of such failure to perform.
c. Customer shall indemnify and save Global harmless from and against any and
all loss, damage, or expense (or claims of damage or liability) asserted
against Global by third parties and arising out of information provided to
Global by Customer or Customer's customers, or arising out of the use of such
information when furnished by Global to Customer's customers or to other
third persons at Customer's request, or to officers, employees and agents of
Customer.
d. Liability of Global in any and all categories and for any and all causes
arising out of this Agreement shall, in the aggregate, not exceed one (1)
month's average billing to Customer taken over the twelve (12) months
preceding the month in which the damage or injury is alleged to have
occurred, but if this Agreement has not been in effect for twelve (12) months
preceding such date, then over such fewer number of preceding months that
this Agreement has been in effect.
8. PROPRIETARY INFORMATION:
a. All proprietary information disclosed by either party to the other in
connection with this Agreement shall be identified as such in writing if not
already identified as such herein, and shall be protected by the recipient
party from disclosure to others. All Systems provided by Global under this
Agreement or used by Global to provide the Services are herein identified as
the proprietary information of Global and Customer may not transfer, modify,
reverse engineer, emulate, copy or use in any way other than as specifically
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authorized in this Agreement. Any software and related documentation
furnished by Customer to Global in connection with this Agreement is
identified as the proprietary information of Customer, but may be retained by
Global until performance under this Agreement is completed or until this
Agreement is terminated, at which time such information and all copies
thereof shall be returned to Customer upon request.
b. Global and Customer acknowledge that all proprietary information disclosed by
either party to the other party for the purpose of work, or which comes to
the attention of one of the parties, its employees, officers, and agents
during the course of such work, constitutes a valuable asset. Therefore,
Global and Customer agree to hold such information in confidence and shall
not, except in the performance of the duties under this Agreement or with the
express prior written consent of the other party, disclose or permit access
to any such information to any person, firm or corporation other than
persons, firms or corporations authorized by that party, and Global and
Customer shall cause their officers, employees, agents, and representatives
to take such action as shall be necessary or advisable to preserve and
protect the confidentiality of such information.
c. Global's and Customer's obligations and agreements under this paragraph shall
not apply to any information supplied that:
(1) was known to either party prior to the disclosure by the other, or
(2) is or becomes generally available to the public other than by breach of
this Agreement, or
(3) otherwise becomes lawfully available on a nonconfidential basis from a
third party who is not under an obligation of confidence to either
party; or
(4) which is disclosed pursuant to a requirement or request of a court of
competent jurisdiction or a government agency (provided that the
receiving party notifies the disclosing party regarding the receipt of
such request prior to its provision of information to the requesting
party).
9. MISCELLANEOUS:
a. This Agreement shall be construed in all respects under the laws of the State
of Georgia, without giving effect to conflicts of laws provisions.
b. This Agreement contains the full understanding of the parties with respect to
the subject matter hereof, and no waiver, alteration or modification of any
of the provisions hereof, except for new Service Pricing Schedule(s), shall
be binding unless in writing and signed by officers of both parties. In the
event Customer issues a purchase order or memorandum or other instrument
covering the Services herein offered and provided, it is hereby specifically
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agreed and understood that such purchase order or memorandum or instrument is
for Customer's internal purposes only and any and all terms and conditions
contained therein, whether printed or written, shall be of no force or
effect.
c. If any part of this Agreement shall be held to be void or unenforceable, such
part will be treated as severable, leaving valid the remainder of this
Agreement notwithstanding the part or parts found to be void or
unenforceable.
d. Except as otherwise provided in this Agreement, notices required to be given
pursuant to this Agreement shall be effective when received, and shall be
sufficient if given in writing, hand delivered, sent by telegraph or First
Class United States Mail, postage prepaid and addressed to the appropriate
party at the address set forth on the cover page hereof.
The parties hereto may change the name and address of the person to whom all
notices or other documents required under this Agreement must be sent at any
time by giving written notice to the other party.
e. Neither party to this Agreement may assign its rights or obligations under
this Agreement without the express written consent of the other party, except
that the obligations of Global under this Agreement may be provided or
fulfilled by any parent, subsidiary, affiliate, successor corporation or
subcontractor of Global so long as Global assumes full responsibility for
such obligations. In the event that Customer merges or consolidates with any
other person or entity, the result of which is that Customer is not the
surviving entity, the obligations and liabilities under this Agreement shall
survive and be binding upon such successor with respect to the Services then
being provided by Global. In the event Customer assumes additional processing
business, as soon as practicable consistent with the terms of any data
processing contracts that Customer is required to assume in connection with
such acquisition, Global shall provide the information technology services
therefor, including all credit card processing. Customer shall give Global
reasonable notice of any such additional processing if such additional
processing would significantly impact the amount of Customer's volume to be
processed by Global.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers and to be effective as of the date executed by
Global.
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EXHIBIT A-2
SERVICE DESCRIPTION FOR MERCHANT PROCESSING SERVICES
For purposes of this Exhibit A-2 defined terms used herein will have the
meanings ascribed thereto in the Agreement.
TRAINING
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Global shall provide to Customer a training program conducted at Global's
facilities for the purpose of training Customer's personnel in the proper use of
Global's procedures, systems, and reports. The training program will include
Global personnel competent to train Customer personnel on the use of the
Services for up to two (2) business days. Customer shall provide competent
personnel for such training and shall cooperate with Global in properly
scheduling such training in conjunction with Customer's conversion to the
Services. If requested by Customer, additional training will be provided at
mutually agreeable rates, plus all related expenses which may include without
limitation, the costs of air fare, meals, lodging, and rental car. In the event
Customer desires to have the initial training conducted at Customer's location,
Customer agrees to reimburse Global for the related travel and lodging expenses
(as described above) of the Global personnel conducting the training.
SECTIONS 1,2 & 3.
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BASIC MERCHANT SERVICES
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1. Global will provide a merchant data base system for Customer to access
on-line account information for inquiry and update.
2. Global will maintain and perform daily data processing and update cycles for
the merchant accounting records of Customer maintained by Global, in
accordance with established Global policies and procedures.
3. Global will provide sales transaction data processing services including:
(a) receiving electronic files in accordance with Global's published
specifications, containing monetary transaction data from third party
point-of-sale vendors, Customer, and/or merchants for data processing of
account data; and
(b) transmitting outgoing interchange fees and settlement; and
(c) processing incoming interchange fees and settlement.
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4. Global will calculate merchant fees and/or discount rates, prepare merchant
account statements, and all merchant and bank reports. Merchant account
statements and merchant and Customer report forms will be provided by Global.
Distribution and delivery shall be in accordance with methods and prices
agreed upon by both parties.
5. Global will receive electronic files containing authorization data from third
party point-of-sale vendors at Customer's direction and in accordance with
Global's published specifications.
6. Customer shall pay the reasonable charges of Global for reruns necessitated
by incorrect or incomplete data or erroneous instructions supplied to Global
and for correction of programming, operator, and other processing errors
caused by Customer, its merchants, or their employees or agents.
7. Generic forms and supplies required to support Customer are included unless
otherwise specified in this Exhibit A-2. Forms may be individualized by
Customer at Customer's expense, provided that such forms, envelopes, or
printed materials are in accordance with Global specifications and processing
requirements. Global, at its option, may assess an additional handling fee
for procuring and storing individualized forms. All legal aspects of all
forms are the responsibility of Customer. Global shall provide Customer
copies of generic forms upon request for Customer to ensure that such forms
are legally appropriate for Customer's program.
SECTIONS 4 & 5.
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RETRIEVAL AND CHARGEBACK SERVICES
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1. Basic Service: Global will provide the processing system for retrieval and
chargeback support for use by Customer.
2. Global will also provide the system and/or staff support for collection
letters, compliance cases, and arbitrations.
3. Reimbursements received from VISA and MasterCard (or other applicable
entities) for retrieval processing will be retained by Global.
SECTIONS 6 & 7.
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OPTIONAL SERVICES
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1. Global will perform merchant plastic and imprinter plate preparation services
upon request by Customer.
2. Global will provide basic microfilm/microfiche services for the copy and
reproduction of reports and account statements.
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3. Global may provide computer systems and computer programming services in
response to specific requests from Customer which is not otherwise provided
as part of the Basic Services.
4. Global will provide preparation, filming, data entry, and balancing of all
merchant paper.
5. Global will provide Special Support Services.
SECTION 8.
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PASS THROUGH SERVICES
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Global shall provide select Services on a pass-through cost basis, as defined in
Exhibit B-2.
The pricing for the services set forth in this Exhibit A-2 which are provided to
Customer are set forth in Exhibit B-2.
Customer:
Digital Courier Technologies, Inc. GLOBAL PAYMENT SYSTEMS LLC
By: /s/ James Egide By:
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Print Name: James Egide Print Name: Suellyn P. Tornay
Title: Chief Executive Officer Title: VP & Acting General Counsel
Date: 5-31-2000 Date:
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