EXHIBIT 10.5
Services Agreement
(Batch Processing)
This Services Agreement (Batch Processing) (the "Agreement") is between
Global Payments Inc., a Georgia corporation ("Global Payments" or "Provider")
and National Data Corporation, a Delaware corporation ("NDC" or "Recipient")
(Global Payments and NDC are each referred to as a "Party" and both are referred
to as the "Parties"), and is dated as of and is made effective as of January 31,
2001 (the "Effective Date").
Background
Prior to the Effective Date, NDC had two primary areas of business, the
processing of credit card transactions (the "Commerce Business") and the
processing of claims and related transactions among health care providers and
health care insurers (the "Health Business").
The Board of Directors of NDC has determined that it is in the best
interests of NDC and its shareholders for NDC to transfer and assign to Global
Payments the capital stock of National Data Payment Systems, Inc., Global
Payment Holding Company, NDC Holdings (UK) Ltd., Merchant Services U.S.A. and
their respective subsidiaries (the "NDC Global Payments Subsidiaries") that hold
all of the assets and liabilities that currently constitute NDC's Global
Payments business and a 0.85% general partnership interest in GPS Holding
Limited Partnership as a contribution to the capital of Global Payments and to
receive in exchange therefore shares of Global Payments common stock, and to
thereafter make a distribution (the "Distribution") to the holders of NDC common
stock of all of the outstanding shares of Global Payments common stock at the
rate of eight-tenths (0.8) of a share of Global Payments common stock for every
one share of NDC common stock outstanding pursuant to a Distribution Agreement,
dated as of the date hereof, between NDC and Global Payments (the "Distribution
Agreement"). The Parties intend that the transactions described in the
Distribution Agreement will be effective at the Effective Time (as that term is
defined in the Distribution Agreement). Upon the Effective Time, NDC's business
will be the Health Business, and Global Payments's business will be the Commerce
Business.
Although the transactions provided for in the Distribution Agreement and
the Ancillary Agreements (as that term is defined in the Distribution Agreement)
will provide for the separation of NDC and Global Payments into separate and
distinct entities and the substantial separation of their operations, and
although the Parties had, prior to the Effective Date, begun (and in some cases,
completed) the separation of certain computer system and network system
functions, other computer systems and network activities presently shared by the
Parties, such as the batch processing capabilities of the Unisys computers (the
"Batch Processing System") that serve both the Health Business and the Commerce
Business cannot be separated as of the Effective Date.
Accordingly, the Parties deem it to be appropriate and in their best
interests in connection with the Distribution that Global Payments shall provide
to NDC certain services upon the terms and conditions of this Agreement for the
period provided for herein and that NDC will reimburse
Global Payments for such services, on an allocated cost basis, plus certain fees
for administrative costs.
Terms and Conditions
Now, Therefore, in consideration of the mutual promises contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties hereto agree as follows:
Article 1 Provision of Services
"Services" means the batch processing services described in Addendum I--
Batch Processing Services.
Provider shall, subject to the terms and conditions of this Agreement,
provide Recipient with the Services.
Article 2 Allocation of Costs
All costs incurred by Provider in connection with the provision of the
Services will be allocated between the Parties as described in the body of this
Agreement or in Addendum II--Allocation of Costs.
Article 3 Invoices and Payments
Section 3.01 Invoices
Provider will provide Recipient monthly invoices which will provide
reasonable details regarding the allocation of costs and other charges for each
of the types of Services rendered.
Provider will use commercially reasonable efforts to provide Recipient with
an invoice by the tenth day of the month following the month in which the
Services were rendered.
Recipient must notify Provider of any objection within twenty (20) days
after its receipt of the invoice, and must provide reasonable details as to
specific charges to which Recipient objects, and the basis for such objection.
Section 3.02 Payment
Recipient agrees to pay Provider all costs allocated to it in accordance
with this Agreement and all other charges that Provider is entitled to charge
pursuant to this Agreement. All payments by Recipient shall be made within
thirty (30) days of Recipient's receipt of an invoice and shall be made by wire
transfer to a bank account designated by Provider.
If any portion of an amount due to Provider under this Agreement is subject
to a bona fide dispute between the Parties, Recipient shall nonetheless pay and
remit to Provider on the date such amount is due all amounts not disputed in
good faith by Recipient.
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Article 4 Term and Termination
Section 4.01 Initial Term
This Agreement shall begin on the Effective Date, and shall expire on May
31, 2001 (the "Initial Term"), unless (i) renewed as provided in Section 4.02 or
(ii) terminated earlier in accordance with the terms of this Agreement.
Section 4.02 Renewal Terms
This Agreement may be renewed for two successive renewal terms of one (1)
year (each a "Renewal Term") (the Initial Term and all Renewal Terms
collectively referred to herein as the "Term") if, during the Initial Term,
Recipient gives written notice of renewal at least thirty (30) days prior to the
last day of the Initial Term; and if, no later than at least thirty (30) days
prior to the last day of the first Renewal Term, Recipient gives written notice
of renewal for the second Renewal Term.
Section 4.03 Extension in Connection with Termination Assistance
If, pursuant to Section 4.06, Recipient requests that Provider provide
termination assistance, then this Agreement shall be extended during the period
that Provider provides such termination assistance.
Section 4.04 Termination
(a) By Recipient for Convenience
Recipient may terminate this Agreement for convenience, in whole but not in
part, by giving Provider at least three hundred sixty five (365) days prior
notice designating the termination date.
(b) By Provider for Non-Payment
Provider may terminate this Agreement if Recipient defaults in the payment
when due of any amount due to Provider and does not cure such default within 10
days after receiving notice of the default.
(c) By Either Party upon Material Default
This Agreement may be terminated by either Party if the other Party commits
a breach of a material term, obligation or condition hereof, where said breach
is not substantially cured within 30 days after receiving written notice of said
breach, or with respect to a material breach that cannot reasonably be cured
within 30 days, that the breaching Party has not commenced substantial action to
cure said breach within 30 days after receiving notice of said breach.
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Section 4.05 Cessation of Performance; Payment
Upon expiration or termination of this Agreement for any reason, except as
provided in Section 4.06, Provider will cease to have any obligation to perform
the Services hereunder, and Recipient will pay and remit to Provider all amounts
due to Provider for all Services provided and expenses incurred through the
date of such expiration or termination.
Section 4.06 Termination Assistance
In connection with the expiration or termination of this Agreement for any
reason unless this Agreement has been terminated by Provider pursuant to Section
4.04(b), Provider will, for a reasonable period, provide reasonable termination
assistance to Recipient in order to assist Recipient in transitioning the
Services from Provider to Recipient or other third party provider; provided,
however, that Recipient shall be obligated to pay all fees and expenses of
Provider incurred in connection with the rendering of said termination
assistance.
Section 4.07 Survival of Selected Provisions
Notwithstanding the expiration or earlier termination of this Agreement for
any reason, however described, the following sections of this Agreement shall
survive any such expiration or termination: Section 4.05; Section 4.06; this
Section 4.07; Article 8; Article 9, Article 10, Article 11; Section 12.06;
Section 12.08; Section 12.10; Section 12.11 and Section 12.12. Upon termination
or expiration of this Agreement, all rights and obligations of the Parties under
this Agreement will immediately cease and terminate (except for the rights and
obligations under those Sections specifically designated to survive in this
Section 4.07).
Article 5 Service Levels
Section 5.01 General
The Parties have agreed to a procedures manual (the "Procedures Manual")
that governs the performance of the Services by Provider. Provider agrees that
the performance and delivery of the Services will meet or exceed any agreed upon
service levels to be set forth in the Procedures Manual, and Recipient agrees
that its only remedies for the failure of the performance or delivery of the
Services to meet or exceed any agreed upon service levels set forth in the
Procedures Manual will be the remedies, if any, set forth in the Procedures
Manual.
Section 5.02 Measured Services
If a performance metric for a particular Service or aspect of the Services
are not set forth in the Procedures Manual, and Recipient requests that one or
more performance metrics be established for a particular aspect of the Services,
then Provider, with the assistance of Recipient shall perform an assessment of
the historical service levels as they existed for the twelve (12) month period
before the Effective Date for such aspect of the Services, and Provider will
propose performance metrics based on that assessment. When performance metrics
for such aspect of the Services have been accepted in writing by Recipient and
Provider, such service levels shall be incorporated into the Procedures Manual,
and Provider will thereafter perform in accordance with such new service levels.
The Parties intend that any and all service levels will not be less favorable
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to Recipient during the Term than they are at the initiation of the Services
pursuant to this Agreement.
Section 5.03 Review and Remedy
The Parties will review the extent to which the Services were performed in
accordance with the Procedures Manual as part of each Monthly Review (as that
term is defined below). If the Services have been performed at a level below any
applicable service levels included in the Procedures Manual, each Party may
propose one or more remedies if no specific remedy is set forth in the
Procedures Manual. These remedies can include modification of the applicable
service levels, equipment changes or changes in operational processes. If,
after the involvement of the Senior Representatives, the Parties are unable to
agree to remedies, either Party may invoke the provisions of Article 11.
Notwithstanding the foregoing, in the event that the Parties cannot reach
agreement regarding a remedy after resort to the dispute resolution procedures
set forth in Article 11, then the Parties may pursue all other remedies
available under this Agreement and the Procedures Manual.
Article 6 Project Management
Section 6.01 Senior Representatives; Monthly Reviews
Provider and Recipient each shall appoint a senior member of management to
represent them with respect to the relationship of the Parties hereunder (each,
a "Senior Representative"). The Provider Senior Representative and the Recipient
Senior Representative shall meet at least one time each calendar month (the
"Monthly Review") to review Provider's performance under this Agreement.
Section 6.02 Account Managers; Weekly Meetings
Provider and Recipient will each appoint an account manager to serve as
such Party's main contact with the other Party for project and request
submissions, status reporting, disputes and other issues related to this
Agreement (each, an "Account Manager"). The Account Managers shall hold weekly
meetings (the "Weekly Meetings") to discuss performance under this Agreement and
all operational and administrative issues relating thereto.
Section 6.03 Personnel Decisions
(a) Provider will consult with Recipient in each instance prior to
transferring, reassigning, terminating, hiring or making other changes in any of
the human resources allocated by Provider as of the Effective Date to the
performance and delivery of the Services. Provider will use commercially
reasonable efforts to maintain continuity of the persons performing Services
under this Agreement.
(b) If Recipient reasonably and in good faith determines that it is not in
Recipient's best interests for any Provider or subcontractor employee to be
appointed to perform or to continue performing any of the Services, Recipient
shall give Provider written notice specifying the reason for its position and
requesting that such employee not be appointed or be removed from the Provider
group servicing Recipient and be replaced with another Provider employee.
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Promptly after its receipt of such a notice, Provider shall investigate the
matters set forth in the notice, discuss with Recipient the results of the
investigation, and the Parties will use commercially reasonable efforts to
resolve the matter on a mutually acceptable basis.
Article 7 Software
Section 7.01 Third Party Software
Prior to the Effective Date, NDC was a licensee of certain software from
third parties (the "Third Party Software"). NDC used the Third Party Software,
together with the Shared Software (as that term is defined below) and the
computer hardware and other devices owned or leased by it to operate the Batch
Processing System. Provider represents and warrants that it has obtained all
Required Consents (as defined below) under the contractual, leasing and
licensing arrangements used by Provider to provide the Services (the "Third
Party Agreements"). The Parties believe that the terms and conditions of the
licenses to the Third Party Software permit Provider to provide the Services to
Recipient pursuant to the terms of this Agreement without any increase in any
royalty fee or any other adverse change in the terms and conditions of such
licenses; however, to the extent that Provider determines or has notice of any
claim that any such license restricts Provider from providing any of the
Services, Provider shall promptly negotiate an amendment to such license so that
it may provide the Services (whether by the grant of a sublicense or otherwise),
and in such event if Provider incurs any increase in the cost of the royalty fee
or other adverse change in the terms and conditions of an existing license, or
renewal or extension thereof, Recipient will reimburse Provider for that portion
of the cost of such license (or the increased royalties or the cost of any other
adverse change in the terms and conditions) that corresponds to Recipient's
proportionate use of such Third Party Software.
Except as provided above, Provider will be responsible for the payment of
all license fees, royalty fees, maintenance fees, acquisition costs or similar
costs incurred in connection with the use of Third Party Software, all of which
will be included as part of the cost allocation process described in Addendum
II--Allocation of Costs. Recipient will be responsible for the payment of all
license fees, royalty fees, maintenance fees, acquisition costs or similar costs
of any Third Party Software used by Provider solely to provide Services to
Recipient, none of which will be included as part of the cost allocation process
described in Addendum II--Allocation of Costs.
Section 7.02 Application of Current Technology
In providing Services hereunder, Provider will continue to utilize the
technology that was used prior to the Effective Date. Provider may not make
changes to its technology that materially and adversely affects the Services,
but, notwithstanding the foregoing, in the event that Provider makes certain
technology changes that materially and adversely affect the Services, Recipient
will have a right to terminate this Agreement for convenience as provided by
Section 4.04(a).
If Provider makes changes to its technology that materially increases the
quality of the Services, any increased development costs, expenses or fees
associated with such technology
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changes will be shared by Provider and Recipient based on the proportionate use
of the Services that were materially improved in quality.
Article 8 Warranties And Additional Undertakings
Section 8.01 By Provider
Provider will perform the Services in a professional and workmanlike
manner.
Section 8.02 Security
Provider is responsible for running a professional data center with the
normal safeguards of an "average" business. Provider shall perform the Services
in accordance with the physical and data security procedures set forth in the
Procedures Manual.
Section 8.03 Virus Avoidance
Each Party will take commercially reasonable measures to ensure that no
virus or similar items are coded or introduced into any software used to provide
the Services and the operating environments used to provide the Services. Both
Parties will continue to perform and maintain at least the virus protection and
correction procedures and processes in place at Provider prior to the Effective
Date. If a virus is found to have been introduced into any software or
operating environment used to provide the Services, both Parties shall use
commercially reasonable efforts and diligently work to eliminate the effects of
the virus. However, Provider shall take immediate action to remediate the
virus' proliferation in the operating environment used to provide the Services.
The Party causing or permitting a virus to be introduced into any software or
operating environment used to provide the Services shall bear the costs
associated with such efforts and the Losses caused by such a virus. If
Recipient introduces or permits the introduction of a virus, Provider shall be
relieved of the affected services levels described in the Procedures Manual to
the extent such virus impacts Provider's ability to satisfy such service levels.
Section 8.04 Disabling Codes
Each Party agrees that it will not insert or use disabling codes in any
software or equipment used to provide the Services. The Parties further covenant
that with respect to any disabling code that may be part of any software or
equipment used to provide the Services, neither Party will invoke such disabling
code at any time, including upon expiration or termination of this Agreement for
any reason.
Section 8.05 Pass-Through Warranties
Provider agrees to pass through to Recipient any warranties given by its
third party vendors in connection with hardware, software or other products or
services used by Provider to provide the Services to the extent permitted by the
terms and conditions of such warranties.
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Section 8.06 Disclaimer of Warranties.
Except as otherwise expressly provided heren, neither party makes any other
representations or warranties, of any kind, nature or description, including
without limitation any warranties of merchantability or fitness for a particular
purpose.
Section 8.07 Noninfringement
Each of the Parties covenants that it will perform its responsibilities
under this Agreement in a manner that does not infringe, or constitute an
infringement or misappropriation of, any patent, trade secret, copyright or
other proprietary right of any third party.
Section 8.08 Regulatory Proceedings and Compliance with Laws
Each Party agrees, at its cost and expense, to obtain all necessary
regulatory approvals applicable to its business, to obtain any necessary permits
for its business, and to comply with all laws and regulatory requirements
applicable to the performance of its obligations under this Agreement. If a
Party seeking a regulatory approval or a necessary permit is dependant upon the
cooperation of other Party in order to obtain such approval or permit, the other
Party will provide such cooperation as is reasonably necessary provided that the
Party seeking such cooperation shall reimburse the cooperating Party for all
costs incurred in connection therewith.
Article 9 Confidential Information
Section 9.01 Confidential Information of Recipient.
Provider covenants and agrees to keep and hold in confidence all of
Recipient's data and other confidential or proprietary information (collectively
the Recipient Confidential Information) provided hereunder or obtained in
connection herewith, and will use said Recipient Confidential Information only
in connection with the performance of the Services. Provider will employ
substantially the same safeguards, but not less than reasonable safeguards, in
protecting the Recipient Confidential Information that it uses in safeguarding
confidential data of its own, or the confidential data of its customers, against
accidental or unauthorized deletion, destruction or alteration.
Section 9.02 Confidential Information of Provider
Recipient covenants and agrees to keep and hold in confidence all of
Provider's data and other confidential or proprietary information (collectively
the Provider Confidential Information) provided hereunder or obtained in
connection herewith, and will use said Provider Confidential Information only in
connection with its receipt of the Services. Recipient will employ substantially
the same safeguards, but not less than reasonable safeguards, in protecting said
Provider Confidential Information that it uses in safeguarding confidential data
of its own, or confidential data of its customers, against accidental or
unauthorized deletion, destruction or alteration.
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Section 9.03 Exclusions
Notwithstanding Sections 9.01 and 9.02, this Article 9 will not apply to
any information which Provider or Recipient can demonstrate, based on
documentary evidence, was: (a) without a breach of duty owed to the disclosing
party, is in the possession of the receiving party at the time of disclosure to
it; (b) received after disclosure to it from a third party who had a lawful
right to and, without a breach of duty owed to the disclosing party, did
disclose such information to it; or (c) independently developed by the receiving
party without reference to Company Information of the disclosing party.
Further, either Party may disclose the other Party's Confidential Information to
the extent required by law or order of a court or governmental agency. However,
the recipient of such Confidential Information must give the other Party prompt
notice and make a reasonable effort to obtain a protective order or otherwise
protect the confidentiality of such information, all at the discloser's cost and
expense. Disclosure
Each Party may disclose the other Party's Confidential Information to those
of the recipient Party's attorneys, auditors, insurers (if applicable),
subcontractors and full time employees who have a need to have access to such
information and have agreed to hold the information confidential.
Article 10 Indemnities
Section 10.01 Losses Defined
"Losses" shall mean all losses, liabilities, damages, penalties and claims
(including taxes and all related interest and penalties incurred directly with
respect thereto), and all related costs, expenses and other charges (including
all reasonable attorneys' fees and reasonable costs of investigation,
litigation, settlement or judgment, interest and penalties).
Section 10.02 Indemnities for Certain Losses
Each Party shall indemnify (in such case, that Party is referred to as the
"indemnitor") the other Party (in such case, that Party is referred to as the
"indemnitee") from all Losses arising out of:
(a) any claim for rent or utilities at any location where the indemnitor
is financially responsible under this Agreement for such rent or
utilities, or
(b) any claim for wages, benefits, third party fees, taxes, assessments,
duties, permits or other charges of any nature for which the
indemnitor is financially responsible under this Agreement, as well as
any additions to tax, penalties, interest, fees or other expenses
incurred by the indemnitor as a result of such charges not being paid
at the time or in the manner required by applicable law, or
(c) an act or omission of the indemnitor in its capacity as an employer of
a person and arising out of or relating to (1) federal, state or other
laws or regulations for the protection of persons who are members of a
protected class or category of persons, (2) sexual discrimination or
harassment, (3) accrued employee benefits not expressly assumed by the
indemnitee and (4) any other aspect of the
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employment relationship or its termination (including claims for
breach of an express or implied contract of employment) and which,
with respect to each of clauses (1) through (4), arose when the person
asserting the claim, demand, charge, actions, cause of action or other
proceeding was or purported to be an employee of the indemnitor, or
(d) any claims of infringement of any patent or any copyright, trademark,
service mark, trade name, trade secret, or similar property right
conferred by contract or by common law or by any law of any country or
any state alleged to have been incurred because of or arising out of
any aspect of the Services provided by Provider in its performance of
the Services, or
(e) any claims for personal injuries, death or damage to tangible personal
or real property of third parties including employees of a Party, and
its subcontractors caused by the negligence or willful misconduct of
such Party, its employees, affiliates or subcontractors. However,
neither Party will have any obligation under this part, to the extent
the same arise out of or in connection with the negligence or willful
misconduct of the non-indemnifying Party, its employees, affiliates or
subcontractors.
Section 10.03 Limitation of Liability
Except for a breach of Section 3.02, Article 9, or liabilities arising from
the Parties' indemnification obligations under Section 10.02, the liability of
each Party to the other for all damages arising out of or related to this
Agreement, regardless of the form of action that imposes liability will be
limited to $100,000.00; provided however, that this limitation of liability also
will not apply to the liability of either Party to the extent such liability
results from (a) that Party's acts of intentional misconduct in the performance
or nonperformance of its obligations under this Agreement; (b) that Party's
nonperformance of its payment obligations to the other expressly set forth in
this Agreement (including, with respect to Recipient, Recipient's obligation to
make payments to Provider, whether in the form of charges for Services performed
hereunder, payments upon termination of this Agreement, or for payment or
reimbursement of taxes, out-of-pocket expenses or pass-through expenses).
Section 10.04 Exclusion of Certain Damages
Except for a breach of Section 3.02, Article 9, or liabilities arising from the
Parties indemnification obligations under Section 10.02, in no event will either
Party be liable for any amounts for loss of income, profit or savings or
indirect, incidental, consequential, exemplary, punitive or special damages of
any Party, including third Parties, even if such Party has been advised of the
possibility of such damages in advance, and all such damages are expressly
disclaimed.
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Section 10.05 Duty to Mitigate
Each Party has a duty to mitigate the damages that would otherwise be
recoverable from the other pursuant to this Agreement by taking appropriate and
reasonable actions to reduce or limit the amount of such damages.
Section 10.06 Time Limit to Make Claims
No claim and demand for mediation or arbitration or cause of action which
arose out of an event or events which occurred more than two (2) years prior to
the filing of a demand for mediation or arbitration or suit alleging a claim or
cause of action may be asserted by either Party against the other.
Article 11 Dispute Escalation and Mediation
Section 11.01 Resolution of Disputes by Account Managers
All disputes between the Parties regarding charges, work activities,
quality of service or any other issue hereunder shall be first raised by
Recipient with the designated Provider Account Manager and the Parties shall
endeavor to amicably resolve the same.
Section 11.02 Involvement of Senior Representatives
In the event of any dispute between the Parties regarding charges, work
activities, quality of service or any other issue hereunder that cannot be
resolved by Recipient with the Provider Account Manager, Recipient is required
to submit its complaint in writing to the Provider Senior Representative within
30 days of the event or circumstance giving rise to said dispute, or as soon
thereafter as reasonably practical. Any such written complaint shall
specifically reference this dispute provision and shall provide reasonable
details regarding the nature and facts surrounding the complaint. The Provider
Senior Representative shall respond to each complaint received hereunder within
30 calendar days of receipt of said complaint. The Provider Senior
Representative and the Recipient Senior Representative shall endeavor to
amicably resolve any such dispute.
Section 11.03 Involvement of Chief Executive Officers
In the event that negotiations in accordance with Section 11.01 and Section
11.02 have failed to resolve a dispute hereunder, the matter shall be referred
to the Chief Executive Officers of Provider and Recipient for attempted
resolution. In the event that the dispute cannot be resolved satisfactorily
between Provider and Recipient at that level, each Party agrees to submit first
to non-binding mediation as provided below.
Section 11.04 Non-binding Mediation
(a) In the event non-binding mediation is required by Section 11.03, the
Parties shall submit the dispute to non-binding mediation to be held in Atlanta,
Georgia. The Parties will choose a neutral mediator from a list of mediators
maintained by the American Arbitration
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Association (the "AAA") office located in Atlanta, Georgia. If the Parties are
unable to agree on the mediator, the mediator will be selected by the AAA.
(b) Notwithstanding any other provision of this Article 11, either Party
may resort to court action for injunctive relief at any time if the dispute
resolution processes set forth in this Article 11 would permit or cause
irreparable injury to such Party or any third Party claiming against such Party,
due to delay arising out of the dispute resolution process.
Section 11.05 Expenses of Mediation
Each Party shall be responsible for its costs of mediation, and the Parties
will each pay one-half of the expenses of the mediator and the AAA.
Section 11.06 Recipient's Sole Remedy Upon Failure of Mediation
In the event that a dispute is not resolved after mediation to the
satisfaction of Recipient, the sole remedy of Recipient is to terminate this
Agreement for convenience as provided in Section 4.04(a), and, in the case of
an overcharge revealed by an audit made pursuant to Section 12.01, to bring suit
for the amount of such overcharge; provided however, the Parties may pursue any
and all remedies available at law or in equity (in each case subject to the
limitations of Section 10.03, Section 10.04, Section 10.05 and Section 10.06)
(other than termination of this Agreement) for breaches of Sections 3.02,
Article 9 or for acts of intentional misconduct in the performance of, or
intentional nonperformance of, the Services or the obligations of the Parties
pursuant to Article 2, Section 8.03, Section 8.04 or Section 10.02.
Section 11.07 Continuation of Services and Obligations Pending Resolution of
Disputes
Notwithstanding the existence of a dispute, Provider shall continue to
provide the Services during any dispute resolution proceedings (whether informal
or formal) and Recipient will continue to perform its obligations (including the
making of all payments which are not the subject of a good faith dispute to
Provider) in accordance with this Agreement.
Article 12 Miscellaneous
Section 12.01 General Audit Rights
Recipient shall have the right to have the books and records of Provider
that relate to the Services provided under this Agreement quarterly by its
internal audit staff, or its external auditors (provided that any person that is
a member of such audit staff or auditors participating in the audit must first
sign a confidentiality agreement containing the same provisions of Article 9)
Recipient shall be solely responsible for the costs and expenses of any such
audit. In the event of such audit, Provider shall provide Recipient's auditors
reasonable access to all relevant books, records and personnel during normal
business hours. In the event an audit reveals an overcharge or undercharge, the
Party who, based on the results of the audit, owes money to the other Party
shall have a reasonable time to review audit and documents that provide the
basis for the conclusions reached by the audit. After such a review, to the
extent such Party does not dispute the conclusions of the audit, such Party
shall pay the other Party the undisputed amounts owed. The disputed amounts, if
any, may be resolved pursuant to Article 11.
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Section 12.02 Subcontracting
Subject to the provisions of Section 6.03 hereof. Provider may subcontract
non-material portions of the Services without consent or approval of Recipient,
provided that (i) the subcontractors sign and deliver to Recipient appropriate
confidentiality agreements in advance of undertaking any of the Services and
(ii) Provider remains primarily liable and obligated to Recipient for the timely
and proper performance of all of its obligations hereunder and for the proper
and timely performance and actions of any person or entity to which it delegates
or subcontracts any such obligation.
Section 12.03 Assignment
Except as provided in this Section 16.5, neither Party may assign this
Agreement, in whole or in part, without the prior written consent and approval
of the other Party hereto, which consent shall not be unreasonably withheld
(provided however, in the case of any assignment by Provider, the Parties agree
that the only basis on which Recipient may withhold such consent is if the
assignee in not competent to provide the Services), except that either Party
may, in connection with the sale of all or substantially all of its assets, any
merger, consolidation, reorganization, or other business combination to which a
Party is a party, assign its obligations and responsibilities hereunder to the
purchaser in the case of a sale of assets, or the surviving entity in the case
of a merger, consolidation or business combination, without the approval of the
other Party. An assignment will not relieve a Party of any obligations under
this Agreement. Any purported transfer, assignment or delegation that does not
comply with the terms of this Section 16.5 shall be null and void and of no
force or effect. Notwithstanding the foregoing, neither Party shall have the
right to assign this Agreement and the obligations hereunder to any successor of
such Party by way of merger, consolidation, reorganization or the acquisition of
substantially all of the business and assets of the assigning Party relating to
the Agreement if such successor's principal business is the business of the
other Party (i.e., the Health Business or the eCommerce Business).
Section 12.04 Consents and Approvals
Each Party will obtain all governmental and other consents necessary for
it to provide or use, as the case may be, the Services.
Section 12.05 Relationship of the Parties
The sole relationship between the Parties shall be that of independent
contractors. No partnership, joint venture, or other formal business
relationship is hereby created between the Parties hereto. Neither Party shall
make any warranties or representations, or assume or create any obligations, on
the other Party's behalf except as may be expressly permitted hereunder or in
writing by such other Party. Each Party shall be solely responsible for the
actions of all their respective employees, agents and representatives.
Section 12.06 Non-solicitation or Hiring of Employees
During the Term and for eighteen (18) months thereafter neither Party will
encourage or solicit any employee or consultant to leave the employ of the other
Party; provided however, that
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the foregoing does not prohibit mass media "want ads" not specifically directed
towards employees or consultants of a Party.
Section 12.07 Expenses
Except as otherwise expressly provided for herein, each Party shall bear
its own costs and expenses in connection with this Agreement and the performance
of its obligations and responsibilities hereunder.
Section 12.08 Notices
All notices and communications under this Agreement shall be deemed to have
been given (a) when received, if such notice or communication is delivered by
facsimile, hand delivery or overnight courier, and, (b) three (3) business days
after mailing if such notice or communication is sent by United States certified
mail, return receipt requested, postage prepaid. All notices and
communications, to be effective, must be properly addressed to the Party to whom
the same is directed at its address as follows:
If to Recipient, to:
National Data Corporation Inc.
Two National Data Plaza
Atlanta, GA 30329
Attention: General Counsel
If to Provider, to:
Global Payments Inc.
4 Corporate Square
Atlanta, GA 30329
Attention: General Counsel
Either Party may, by written notice delivered to the other Party in
accordance with this Section, change the address to which delivery of any notice
shall thereafter be made.
Section 12.09 Amendment and Waiver
This Agreement may not be altered or amended, nor may any rights hereunder
be waived, except by an instrument in writing executed by the Party to be
charged with such amendment or waiver. No waiver of any terms, provision or
condition of or failure to exercise or delay in exercising any rights or
remedies under this Agreement, in any one or more instances, shall be deemed to
be, or construed as, a further or continuing waiver of any such term, provision,
condition, right or remedy or as a waiver of any other term, provision or
condition of this Agreement.
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Section 12.10 Entire Agreement
This Agreement constitutes the entire understanding of the Parties hereto
with respect to the subject matter hereof, superseding all negotiations, prior
discussions and prior agreements and understandings relating to such subject
matter.
Section 12.11 Severability
The provisions of this Agreement are severable and should any provision
hereof be void, voidable or unenforceable under any applicable law, such
provision shall not affect or invalidate any other provision of this Agreement,
which shall continue to govern the relative rights and duties of the Parties as
though such void, voidable or unenforceable provision were not a part hereof.
Section 12.12 Governing Law
This Agreement shall be construed in accordance with, and governed by, the
laws of the State of Georgia, without regard to the conflicts of law rules of
such state. This Agreement is expressly made subject to any United States
government laws, regulations, orders or other restrictions regarding export from
the United States of computer hardware, software, technical data or derivatives
of such hardware, software or technical data.
Section 12.13 Force Majeure
Provider will not be liable for any failure of performance of the Services
under this Agreement due to any cause beyond its reasonable control, including
acts of war, acts of God, earthquake, flood, embargo, riot, sabotage, labor
shortage or dispute or governmental act or any other causes beyond Provider's
reasonable control, whether or not of the same class or kind as those
specifically named above.
Section 12.14 Counterparts
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original instrument, but all of which together shall
constitute one and the same Agreement.
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IN WITNESS WHEREOF, the Parties hereto have executed and delivered this
Agreement as of the day and year first above written.
NATIONAL DATA CORPORATION
By: /s/ Randolph L. M. Hutto
--------------------------
Name: Randolph L. M. Hutto
Title: Chief Financial Officer
Global Payments Inc.
By: /s/ Paul R. Garcia
--------------------------
Name: Paul R. Garcia
Title: Chief Executive Officer
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Addendum I--Batch Processing Services
General
Provider will provide to Recipient batch claims processing, printing
services, provision of backup tapes, system backup and offsite storage.
Locations
The Services will be provided at Recipient's Atlanta location.
Specific Services
(a) Batch Runs
Conduct daily claims processing batch runs Monday through Friday.
Conduct five claims processing batch runs over each Saturday through Sunday
period.
Conduct four weekly claims processing batch runs.
Conduct ten monthly claims processing batch runs.
(b) Printing Services
Print daily claims processing print files (HC/RX).
Print weekly Customer Profile System files.
Conduct ten Customer Profile System print runs per month.
(c) Provision of Tapes for System Backup
Provide Tandem backup tapes as needed.
Provide Unisys backup tapes as needed.
(d) Offsite Storage
Provide off-site storage for Tandem back-up tapes as needed.
Provide [off-site] storage for generic daily tapes as needed.
Provide [off-site] storage for VAX/CLINIX backup tapes as needed.
Addendum II--Allocation of Costs
Recipient will pay monthly fees to Provider for the Services. The Fees
will be based on the allocated cost of the Services.
As of the Effective Date, Provider has estimated that the Services will
have an allocated cost of $28,523.50, calculated as follows:
Provider estimates that the following personnel time will be required to
provide the Services: (i) thirty minutes of manpower per day for print time,
(ii) one hour of manpower per day for batch run set-up, (iii) three hours of
manpower per day for tape handling, (iv) two hours of manpower per day for
offsite handling, (v) thirty minutes of manpower per day for customer support
and (vi) two hours of manpower per day for system operations, for an estimated
monthly allocated cost of $6,000.00.
Provider estimates that (i) it will print an estimated 9,100 daily claims
processing print files (HC/RX) per month; (ii) print an estimated 1,733 weekly
Customer Profile System files per month, (iii) conduct ten Customer Profile
System print runs per month for an estimated total of 34,234 files per month,
for an estimated monthly allocated cost of $902.00
Provider estimates that the estimated time requirement by Provider to
conduct all of the above batch runs is 37 hours per month, for an allocated
monthly cost of $18,500.00.
Provider estimates that Recipient will require an estimated 6,604 Tandem
backup tapes annually and an estimated 5,034 Unisys backup tapes annually, for
an allocated monthly cost of $969.00.
Provider estimates that Recipient will require (i) off-site storage for 225
total Tandem back-up tapes; (ii) [off-site] storage for 3,960 total generic
daily tapes, and (iii) [off-site] storage for twelve cases of VAX/CLINIX backup
tapes, for an estimated fee to an outside vendor of $2,152.50 for such offsite
storage.