NOW THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which is hereby acknowledged, the parties agree with one another as follows:

 

ARTICLE 1 – DEFINITIONS

1.1 In this Agreement, the following terms will have the following meanings:

(a) “Account” means the bank account designated by the Client and into or from which all Settlement Funds are to be deposited or withdrawn by the Company.

(b) “Agreement” means this Merchant Services Agreement and any amending agreements or document(s) duly executed in accordance with the terms hereof.

(c) “Chargeback” means any Transaction which is reversed by a financial institution, leaving the Client liable for the amount of the Transaction, and any other similar charges, as more particularly described in Section 6.1.

(d) “Charges” means all amounts chargeable to the Client by the Company in accordance with the terms of this Agreement, including Chargebacks, Fees and other similar charges, the amounts referred to in Section 4.6, the amounts referred to in Section 5.1, the amounts described in Article 7, and such other amounts as are referred to in any other provisions of this Agreement, as well as any other applicable or appropriate fees or holdback amounts, as may be determined by the Company in its sole discretion.

(e) “Confidential Information” means all information regarding the Company or the Client that is confidential and/or proprietary to such party, including without limitation: (i) all Processing Data, including all personal and banking information of the Client or any  Customer; (ii) all systems required for the delivery of the Services, including general, technical and operational capabilities; (iii) marketing strategies; (iv) information relating to Client and Company; and (v) this Agreement and all terms and provisions hereof. But excludes any information provided by the Disclosing Party that: (vi) is generally available to the public or becomes generally available to the public in a manner other than as a result of disclosure by the Receiving Party or its Representatives; or (vii) becomes available to the Receiving Party or its Representatives from a source other than the Disclosing Party or any of its Representatives.

(f) “Customer” means a customer of the Client.

(g) “Disclosing Party” means whichever of the Company or the Client that discloses Confidential Information to the Receiving Party or its Representatives pursuant to this Agreement.

(h) “Entry” or “Entries” has the meaning provided in the Rules and shall also include the data transmitted by the Client to the Company to prepare such Entries for processing and clearing.

(i) “Event of Default” means and shall occur if: (i) The Client defaults in performance of its duties or obligations under this Agreement; (ii) any representation or warranty of the Client hereunder is materially inaccurate when made or at any time after the date hereof, becomes inaccurate or untrue; (iii) any course of action is taken by or on behalf of the Client for its dissolution or winding up, or the bankruptcy or insolvency of the Client or any bankruptcy or insolvency proceedings are taken by or against the Client; or (iv) Failure to inform any changes of the nature of the Client’s business as indicated on the Merchant Application & Agreement within thirty (30) days of the change; or (v) Failure to inform any changes to the ownership of the Client’s business within thirty (30) days of the change

(j) “Fee or Fees” means the fees payable by the Client to the Company, as set out in Schedule “C” plus any applicable penalties and/or interest.

(k) “Governmental Authority” means any court or tribunal or administrative, governmental or regulatory body, agency or authority, whether Canadian or foreign.

(l) “Laws” means applicable laws (including common law or civil law), statutes, by-laws, rules, regulations, Orders, ordinances, protocols, codes, treaties, mandatory directions, decrees, judgments, awards or binding  requirements, in each case of any Governmental Authority;

(m) “Losses” means any losses, damages, injuries, costs, legal fees on a substantial indemnity basis, and includes, without limitation, special, incidental or consequential damages incurred by the Company.

(n) “Merchant Application & Agreement” means the application made by the Client to the Company for the delivery of the Services, being Schedule “A” to this Agreement.

(o) “Processing Data” means any and all data necessary for the Company to perform the Services, formatted in a manner satisfactory to the Company.

(p) “Prohibited Transactions” means any Transaction including but not limited to the goods and services listed below, which may be contrary to the interests of the Company, including without limitation any Transaction which is or may be deemed to be harmful to the public image of the Company and/or in contravention of applicable Laws or the Rules: (i) pornographic or illicit material of any type, including escort services; (ii) lottery tickets and gambling operations, including “virtual casinos”; (iii) products or services that are illegal or of an illegal nature; (iv) ticket factoring; (v) any sales or other arrangement involving pyramid selling; (vi) tobacco for shipment outside of Canada; (vii) firearms; (viii) telemarketing; (ix) collection agencies; (x) the Client engages in Transactions that create an overcharge to a Customer by duplication of charges; (xi) the total dollar amount shown on the Transaction record is, or is claimed by a Customer to be, larger than the amount approved by such Customer; (xii) the Transaction is for any reason illegal, null, invalid or otherwise improper; (xiii) the Client has previously submitted the Transaction for Settlement or the Company has already credited the Account for the Transaction; (xiv) the Transaction submitted for Settlement is fictitious, or the Client has otherwise defrauded, allegedly defrauded, or attempted to defraud the Company; (xv) the Client submits for Settlement a Transaction representing goods sold or services performed (or allegedly performed) by parties other than the Client; (xvi) Credit transactions which have not been funded via wire; (xvii) the Client submits for Settlement a recurring Transaction regarding a Customer after receiving notification from such Customer to cancel future Transactions; or (xviii) such other goods or services, including addition, deletion or other modification to those listed above, as the Company, in its sole discretion, may determine from time to time on delivery of written notice to the Client, and upon receipt of such written notice any addition, deletion or other modification shall be binding upon the Client for the purposes of this Agreement.

(q) “Receiving Party” means whichever of the Company or the Client that receives Confidential Information from the Disclosing Party or its Representatives pursuant to this Agreement.

(r) “Representatives” means: (i) in the case of a corporation, a corporation’s directors, officers, employees, agents, lawyers, accountants and other individuals, firms or corporations engaged by the corporation to advise it, as well as any parents, subsidiaries and/or affiliates of the corporation; and (ii) in the case of an individual, that person’s employees, agents, executors, administrators, powers of attorney, lawyers, accountants and other individuals, firms or corporations engaged by the person to advise her/him.

(s) “Reserve” means funds collected by the Company as a non-interest bearing security deposit, which shall be held by the Company as security for the obligations of the Client pursuant to this Agreement, as is or may be more particularly described in Schedule “C” or in such other pricing schedule agreed by the Company and the Client and hereby expressly incorporated by reference.

(t) “Reserve Account” means a general non-interest bearing non-client specific account created and maintained by the Company, in which the Reserve shall be managed and maintained;

(u) “Rules” has the meaning provided in the Recitals to this Agreement.

(v) “Services” means electronic data processing and settlement services provided to the Client by the Company in order to facilitate payment and collection of electronic cheques, bills of exchange or other similar instruments, which services are usually described as “ACH/EFT” services.

(w) “Settlement” or “Settlement Funds” means the value of Transactions, less any applicable Charges and Fees and unfunded or returned Transactions, as noted in a Settlement Report.

(x) “Settlement Report or Settlement Summary” means a statement produced by the Company for the benefit of the Client when Transactions have been processed, as more particularly described in Section 2.3.

(y) “Transactions” means processing of electronic cheques, bills of exchange or other similar instruments, adjustments, refunds, returns, or credits to and from a Customer, where such transaction is in the ordinary course of business of the Client and facilitates a legitimate provision of goods or services to a Customer.

(z) “Transaction Processing Date” means the date on which an authorized Transaction is scheduled to be processed by the Company on behalf of the Client.

 

ARTICLE 2 – SERVICES

2.1 The Company agrees to provide the Services on behalf of the Client for Transactions to, from, by or with Customers, subject to the following: (a) All Transactions shall comply with the terms, conditions, representations and warranties set out in this Agreement or other documents delivered to the Client from time to time governing the Services, whether or not such documentation is referred to herein, including all procedures established by the Company and that the Client must follow relating to the use of the Services; (b) All Transactions shall comply with all applicable Laws, including without limitation the Rules; and (c) The Client acknowledges and agrees that the Company may use the services (the “Bank Services”) of any bank, credit union, or other provider, as it may deem advisable in its sole discretion in connection with the delivery of the Services.  Such bank, credit union, or other registered financial institution shall not, in any circumstance, be responsible or liable to the Client by reason of any act or omission of such bank, credit union, or other registered financial institution in the performance of such Bank Services, or by reason of the loss, theft, destruction or delayed delivery of any instrument while in transit to or from or in the possession of such bank, credit union, or other registered financial institution.

2.2 The Company shall establish necessary security and identification procedures for electronic processing pursuant to the Rules and the applicable law and the Client agrees to comply with such procedures. The Company shall establish minimum and maximum amount limitations for electronic processing by Client subject to prior written notice and mutual agreement.

2.3 The Company shall provide the Client with a Settlement Report on each settlement day which shall include all settled Transactions.  Settlement Funds, if applicable, shall be drawn or sent commencing the fourth business day following the processed date of each transaction. 

2.4 The Client shall review Settlement Reports provided by the Company and notify the Company in writing within ninety (90) days of the receipt of such Settlement Reports regarding any incorrect information.  In the event that the Client does not so notify the Company of any discrepancies in accordance with this Agreement, the Client shall be deemed to agree that all Transactions and Fees listed in the subject Settlement Report are correct and the Client hereby agrees that the Company will be thereafter released and forever discharged from any complaint, claim, demand, action or proceeding relating to any item on such Settlement Report.  Notwithstanding anything to the contrary in this Agreement, the Company shall not be subject to any limitations (other than applicable limitation periods prescribed by the Laws) with respect to the correction of any discrepancies with respect to the Transactions or Fees.

 

ARTICLE 3 – PROCESSING REQUIREMENTS

3.1 The Client acknowledges and agrees that Transactions will be submitted for processing to the Company in accordance with and subject to the following: (a) The Client shall accept only electronic cheques as source documents to initiate ACH/EFT Entries through the Company which are drawn on or payable through a participating bank, credit union or other financial institution; (b) The Client shall obtain, and make available to the Company, a Customer authorization in the form of a written pre-authorized agreement, in accordance with the Rules, for each electronic cheque transaction submitted for electronic processing, unless otherwise stated in the original customer authorization agreement. The Client understands and acknowledges that it is a violation of applicable law or the Rules to process Entries against a Customer’s bank account without the Customer’s express written authorization and consent.  The Client agrees that it will not submit any Transactions for processing or payment where the Customer has withdrawn or otherwise revoked its written authorization and consent as required by the Rules; and (c) The Client acknowledges that the Customer’s authorization allows the Client to instruct the Company to initiate an Entry for the Client against such Customer’s account and that the Company is permitted to reinitiate an Entry if the original Entry is returned. If an electronic cheque is returned unpaid, the Company shall be entitled to debit the Account for the amount of the electronic cheque or other similar or related bill of exchange.

3.2 The Client acknowledges and agrees that the following Transactions are unacceptable for electronic processing, that it shall not submit any of the following Transactions to the Company for electronic processing and that the Company is entitled to reject any such Transactions or withhold any Settlement Funds, in its sole discretion: (a) Any electronic cheques drawn on a bank that is not insured by the Federal Deposit Insurance Corporation (“FDIC”) insurance or a credit union that is not insured by the National Credit Union Administration (“NCAU”) insurance or a similarly uninsured financial institution, all collectively referred to as a “Non-Participating FI”; (b) Third party items for electronic processing or any Transaction resulting from goods sold or services performed (or alleged to be performed) by parties other than the Client; (c) Any Transaction representing the financing of an existing obligation arising from a dishonoured electronic cheque or other similar or related bill of exchange, or from a credit card, debit card or smart card disputed with a Customer; (d) Any Transaction by the Client on behalf of any other person, partnership, firm, corporation or entity, whether or not related to the Client, for which proper written approval and authorization has not been obtained from all interested parties to the Transaction; (e) Any Prohibited Transaction; (f) An attempt to collect a chargeback; (g) An electronic cheque or other similar or related bill of exchange which is altered by the Client in any way; (h) A Transaction regarding an account on which the Company was previously denied authorization and was unable to rectify and/or to obtain new authorization; or (i) A Transaction where acceptance of an Entry does cause or may cause the Company to violate the Rules or any federal, provincial/state or local law, rule, statute, or regulation, including without limitation any regulations or other directives of the Federal Reserve, Bank of Canada, CPA, NACHA or other regulatory risk control program or organization.

3.3 The Client understands and agrees that the Client’s submission of any of the Transactions described in Section 3.2 for electronic processing may result in the immediate suspension or termination of the Services provided by the Company, in which event all Settlement Funds of Client, including those in the Account, may be held by the Company in accordance with the provisions of the Agreement.

3.4 The Company may return any item to the Client for correction or proper processing.

3.5 The Client agrees to adhere to the procedures that the Company provides to the Client for dealing with Transactions.  The Client acknowledges that the Company may amend these procedures from time to time because of changes in the Rules or for other reasons, and such amendment shall be forwarded by the Company to the Client.

3.6 The Client shall not impose any surcharge on the Services, including any electronically processed electronic cheque Transaction.  The Client shall collect all required taxes at time of sale.  The Client shall be responsible for remitting to the appropriate authorities all taxes collected in a timely manner.

3.7 Client agrees that a batch file shall consist of all Transactions submitted by 8:00 PM (EST) on each calendar day prior to the Transaction Processing Date, excluding weekends and holidays.  The Client acknowledges and agrees that failure to submit batch files for processing will delay performance of the Services.

3.8 The Company will accept Entries via electronic cheque software on a 24-hour per day basis. 

3.9 The Client agrees that the Company may reject the Client’s Entries for any reason permitted in this Agreement and/or if acceptance of such Entry would cause the Company to potentially violate the Rules or any federal, provincial/state or local law, rule, statute, or regulation, including without limitation any regulations or other directives of the Federal Reserve, Bank of Canada, CPA, NACHA, or other regulatory risk control program or organization.

3.10 The Client acknowledges that all Transactions between the Company and the Client under this Agreement, except assessment of Fees, shall be treated as a single Transaction for purposes of Settlement between the Client and the Company.

3.11 The Client shall utilize electronic cheque software provided by the Company for processing all electronic cheque Transactions.

3.12 The Client shall, at its own expense, maintain and operate all systems, computer and other equipment and software necessary for processing Transactions.

 

ARTICLE 4 – SETTLEMENT

4.1 The Client acknowledges and agrees that this Agreement provides for the provisional settlement of Transactions, subject to the terms and conditions of this Agreement.

4.2 Subject to deduction of Charges and Fees, all Settlement Funds received on behalf of the Client for authorized Transactions shall be electronically transmitted to the Account as of the date of settlement.

4.3 In the event that payment is rejected by the Client’s bank, credit union or other financial institution, or such payment is not received by the Company within five (5) days from the date of submission, the Company may periodically wire transfer Settlement Funds due to the Client until the problem is corrected, at the Client’s expense.

4.4 Charges and Fees may be deducted by the Company from amounts owing to the Client with respect to any Transaction submitted for processing or may be debited against the Account with prior written notification and report. 

4.5 The Client hereby authorizes the Company to initiate Entries to the Account. The Client’s authorization shall continue in effect for one hundred and twenty (120) days after termination of this Agreement, or for such longer period as determined necessary by the Company in order to properly effect any termination of this Agreement.

4.6 If the Company is investigating a Transaction for breach of representation, warranty or covenant by the Client or for any other reason(s), the Client acknowledges and agrees that the Company may hold back from Settlement Funds such amount as the Company determines, when necessary and will provide written notification. The Client acknowledges that the Company shall monitor the Client’s transactional activity and the Client agrees that the Company may delay delivery of Settlement Funds for up to thirty (30) business days. If additional hold time is necessary, Company will provide prior written notice at least ten (10) business days in advance. The Company will attempt to notify the Client of any investigation but the Client acknowledges and confirms that the Company shall have no liability to the Client or any other party, for any such actions taken by the Company.  The Client agrees that, subject to being provided written notification, the Company may hold, setoff or retain Settlement Funds to protect against amounts owed to the Company or based on the Client’s financial condition.

4.7 In addition to the provisions set forth in this Agreement and notwithstanding any provision to the contrary, the Company shall have no obligation to reimburse Client for Transactions that are: (a) not honoured by a Customer’s bank, credit union or other financial institution due to such Customer’s instructions to prevent or otherwise “stop payment” on the Transaction; (b) in any way fraudulent by virtue of the acts or omissions of the Client or its Representatives, either as a principal or as an accessory to such fraudulent activity; and (c) with respect to electronic cheques that are lost, stolen, altered or counterfeit, and the Company has reason to believe that the Client failed to use reasonable care in verifying the relevant Customer’s identity.

4.8 The Client acknowledges and agrees that, when EFT/ACH clearing/collection services are required, the Company may utilize an appropriately licensed party to perform such clearing/collection services as the Company in its sole discretion may select.

 

ARTICLE 5 – RESERVES

5.1 The Company acknowledges that no Reserve or Reserve Account is initially required to be established. The Client acknowledges that it may become necessary for the Company to hold a Reserve from the Client to be held by the Company in a Reserve Account. If it becomes necessary for the Company to hold a Reserve, the Company will notify the Client in writing at least thirty (30) days in advance of a requirement to fund a Reserve Account. Upon both the Company and Client mutually agreeing upon the amount and terms and conditions of the Reserve and Reserve Account, both parties agree to append the language to this Agreement.

 

ARTICLE 6 – CHARGEBACKS

6.1 The Client shall bear all risk of loss arising out of or in connection with this Agreement, without recourse to the Company, for the amount of any Transaction, applicable Fees, amounts due to the Company or any other expenses or losses incurred by the Client from the Company’s provision of the Services, absent breach of this Agreement by the Company. The Company shall have the right to debit the Client’s incoming Transactions, the Account or any other Settlement Funds of the Client in the Company’s direct or indirect control by reason of the Company’s security interest granted by the Client in Section 7.2, and to charge back such transactions to the Client including, but not limited to, the circumstances set out in Section 6.3.

6.2 The Company may change, increase or alter any discount rate, Transaction Fee or other rate or fee as provided in in Schedule “C” to this Agreement or in such other pricing schedule as may have been acknowledged and agreed by the Company and the Client upon sixty (60) days written notice to the Client.

6.3 The Client agrees that any of the following shall constitute a matter which will entitle the Company to a Chargeback: (a) failure by the Client to disclose to the Company any evidence of alleged fraud obtained by the Client that is in any way related or relevant to a Transaction; (b) the Client has Chargebacks exceeding one percent (1%) of the total number of Transactions completed by the Client; (c) a return code of R10 or R29 when the Company receives requests from Customers or issuing banks, credit unions or other financial institutions for retrieval of documentation; (d) a return code of R07 when goods or services have been returned to a Customer or were not received by a Customer or are claimed by a Customer to be unsatisfactory, leading the Customer to revoke authorization from the originator; (e) a Customer has received a refund notice issued by the Client for which a Customer has not been compensated; and/or (f) the Transaction represents a previously settled Transaction, which has been subject to a Chargeback to the Client.

6.4 The Client understands and agrees that, in the event of a Chargeback, the Company: (a) is entitled to refuse to credit the Account for the amount of the Transaction; or (i) may Chargeback all or a part of the Transaction to the Client by debiting the Account, the Reserve Account or the  deducting an amount from the Settlement Funds; or (ii) has the right to access the Account.

6.5 The Client agrees to settle all Customer claims and disputes about a Transaction directly with the affected Customer.  The Client agrees that the Company shall not be responsible for attending to or servicing any Customer queries, complaints or requests regarding any Transaction.

 

ARTICLE 7 – FEES AND OTHER CHARGES

7.1 The Client acknowledges and agrees that attached to this Agreement as Schedule “C” and incorporated herein by reference is a schedule of fees and other terms and conditions in effect as of the commencement date of this Agreement. The Company reserves the right at all times to change all or part thereof or any other terms of this Agreement, upon sixty (60) days written notice to Client and mutual agreement.

7.2 The Client further covenants and agrees with the Company as follows: (a) The Client acknowledges and agrees that each debit and credit Entry shall constitute a separate transaction for which a processing fee will apply. (b) The Client unconditionally agrees and promises to pay all Fees and all Chargebacks, without set-off or deduction for any reason whatsoever, and further acknowledges that all Fees and all Chargebacks may be deducted from the Settlement Funds in the Company’s sole discretion. (c) In the event that there are insufficient Settlement Funds to cover the amounts owed by the Client under this Agreement, the deficit shall constitute a debt of the Client payable on demand, and the Client shall pay all invoices in respect thereof immediately upon receipt.  The Company may, subject to prior notice to the Client, debit the Account or Settlement Funds for any amount then owed by the Client to the Company hereunder. (d) The Client agrees that the Company may deduct any outstanding balance from the Account, the Reserve or from any Settlement Funds due to the Client.  In the event that the Company is required to pursue collection of any outstanding sums, the Client agrees to the maximum amount of civil, legal and collection fees/charges as allowed by law, including without limitation the Company’s actual legal fees, costs and disbursements.

 

ARTICLE 8 – REPRESENTATIONS, WARRANTIES AND COVENANTS

8.1 The Client represents, warrants, covenants and agrees to and with the Company as follows, (and acknowledges that the Company is relying on such representations, warranties and covenants in entering into this Agreement and providing the Services) that:

(a) The Client is a legal entity duly organized, validly existing and in good standing under the laws of its jurisdiction of formation. The Client has all requisite corporate power and authority to own, operate and lease its properties and to carry on its business as presently conducted. 

(b) The Client is duly qualified to transact business and is in good standing as a foreign corporation in all jurisdictions where it is required to be so qualified.

(c) The Client has all requisite corporate power and authority to execute and deliver this Agreement and the other Transaction Agreements, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby.  No further corporate proceedings on the part of or with respect to the Client are necessary to approve and authorize the execution and delivery of this Agreement or any of the Transaction Agreements, the performance by the Client of its obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby.  This Agreement has been, and, when signed or entered into, each of the Transaction Agreements will be, duly executed and delivered by the Client and, upon execution and delivery thereof by the Client, will constitute a valid and binding agreement of the Client, enforceable against the Client in accordance with its terms except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights in general and subject to general principles of equity.

(d) The execution and delivery by the Client of this Agreement and the Transaction Agreements to which it is a party, the performance of all obligations of the Client hereunder and thereunder and the consummation of the transactions contemplated hereby and thereby, will not: (i) materially violate any Law applicable to the Client or any of its Subsidiaries; (ii) violate, conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under: (a) any provision of the Articles of Incorporation or the Client Bylaws (in each case, as amended to date); or  (b) any provision of any Contract to which the Client or any of its Subsidiaries is a party or by which any of their assets may be bound; (iii) result in the creation of, or impose upon the Client or any of its Subsidiaries the obligation to create, any Encumbrance upon the assets of the Client or any of its Subsidiaries, or trigger any charge, payment or requirement of Consent, cancellation right, change of control event or the acceleration or increase of the maturity of any payment date under any Contract or any applicable Law or Order to which the Client or any of its Subsidiaries, or any of their respective properties, is subject; or  (iv) impair the ability of the Client or any of its Subsidiaries to operate the Business.  The Client has previously delivered or made available to the Company true, correct and complete copies of the Articles of Incorporation and bylaws (including all amendments to the same) of the Client, as in effect on the date hereof.

(e) Neither the execution and delivery by the Client and/or the Guarantors of this Agreement and/or the Transaction Agreements, as applicable, nor the consummation or performance by the Client and/or the Guarantors of the transactions contemplated hereby or thereby, requires any Consent from, authorization or approval or other action by, notice to or declaration, filing or registration with, any Governmental Entity, with respect to the Client or any of its Subsidiaries.

(f) The Client shall fully comply with all applicable Laws and Rules, as amended from time to time, including those with respect to consumer protection;

(g) The Client has not committed an act of bankruptcy, is not insolvent, has not proposed a compromise or arrangement to its creditors generally and has not had a receiver, trustee or encumbrancer take possession of its property and has not had a petition in bankruptcy order filed against it;

(h) the execution and delivery of this Agreement shall not violate or breach the provisions of, constitute a default of under or conflict with any agreement, judgment, order, decree, award, license, permit, Laws, the Rules which may be binding on the Client or to which the Client may be subject;

(i) all information, documents and statements disclosed by the Client to the Company are true and correct and the Client has no information or knowledge of any fact that might reasonably be expected to deter the Company from entering into this Agreement and providing the Services to the Client;

(j) the Client has fully disclosed to the Company the true ownership of the Client’s business, including any operating business entity or entities, and to notify the Company of any future modifications to ownership within thirty (30) days of such changes;

(k) If the Client changes the nature of its business as indicated on the Merchant Application & Agreement, the Client must notify the Company within thirty (30) days of such changes;

(l) with respect to each Transaction presented to the Company by the Client for processing, the Client specifically represents and warrants that: (i) any and all such Transactions are and shall be bona fide; (ii) each Customer debit or credit Entry was authorized by the person named on the Account or the authorized representative of such person; (iii) the proof of purchase is valid in form and has been completed in accordance with the Rules and all applicable Laws and provisions set forth in this Agreement; and (iv) the Client has or will deliver the goods or complete the services identified in the authorized proof of purchase draft in a timely manner and as specified in the Customer debit or credit authorization; and

(m) it shall observe and perform all of its obligations under this Agreement in a timely manner.

8.2 The Client acknowledges and agrees that all representations, warranties and covenants contained herein shall survive the execution and delivery of this Agreement and for so long as the Agreement remains effective, notwithstanding any investigation made or done at any time by the Company.

 

ARTICLE 9 – INDEMNITY

9.1 The Client agrees to indemnify, defend and hold the Company and its Representatives (the “Indemnified Parties”) harmless from and against any and all Losses incurred by or made against the Indemnified Parties to which the Company shall or may become liable for or suffer arising from, relating to or in connection with: (a) the failure of the Client or its Representatives to observe or perform any provision or its obligations pursuant to this Agreement; (b) negligence, willful misconduct (including, without limitation, fraud or any other criminal act) or unreasonable delay by the Client in performing its obligations pursuant to this Agreement; (c) any claims, liabilities and issues of any kind or nature whatsoever arising from, relating to or in connection with the acts or omissions of the Client, including without limitation any action, suit or other proceeding in which the Company is named arising from, relating to or in connection with such acts or omissions of the Client, whether or not the Client has also been named; and (d) any material inaccuracy in any representation or warranty made by Client hereunder.

 

ARTICLE 10 – EXCLUSIVITY

10.1 The Client shall be granted the ability to process electronic cheque Transactions related to its business through another processor that is not a Non-Participating FI, without this Agreement being terminated, in which case the Client shall endeavor to provide reasonable written notice of any such intended use in advance of using such secondary processor together with the reason for using such secondary processor, including any service that is not being delivered by the Company.

 

ARTICLE 11 – LIMITATION OF LIABILITY

11.1 The Company shall not be responsible for any other persons or entity’s errors, acts, omissions, failures to act, negligence or intentional conduct, including without limitation entities such as the Company’s communication carrier or any clearing institution.  In no event shall the Company be liable to the Client for any consequential, incidental, punitive or special damages that the Client, its Representatives, or its Customers, may incur or suffer in connection with this Agreement arising from, relating to or in connection with the Company’s acts or omissions pursuant to this Agreement.

11.2 Company shall not be responsible for delays, non-performance, damages, lost profits or other losses caused directly or indirectly by any Act of God, including without limitation fires, earthquakes, floods, tornadoes, hurricanes, wars, labour disputes, communication failures, legal constraints, power outages, or any other event outside the direct control of the Company.

11.3 The Company shall not be liable to the Client and the Client hereby fully and forever releases and discharges the Company from any and all liability whatsoever with respect to consequential damages or economic loss (including but not limited to loss of income, expenses incurred to minimize or avoid loss of business or loss of service to customers), whether or not caused by an act or omission or breach of contract of the Company or by an act or omission of a person for whom the Company is responsible. Should any action or omission by the Company or its representatives result in a loss of income or substantial financial losses for the Client, this agreement will be deemed immediately terminated, and any outstanding settlements, net of charges and fees, owed to the Client shall be paid within thirty (30) days.

 

 

ARTICLE 12 – TERMINATION

12.1 This Agreement shall continue indefinitely unless and until terminated by either the Company or the Client.  The Client may terminate this Agreement upon thirty (30) days’ written notice to the Company.  The Company shall have the right to suspend the Services upon written notice to the Client. The Company may terminate this Agreement by providing the Client with thirty (30) days’ prior written notice.  The Company may terminate this Agreement at any time, with written notice to the Client, upon the occurring of an Event of Default, provided that all representations, warranties and covenants of the Client shall survive in full force and effect until such time as all amounts owing to the Company have been paid in full.

 

ARTICLE 13 – CONFIDENTIALITY

13.1 The Company and the Client acknowledge that in performing the terms and conditions of this Agreement, each party and its Representatives may be given, receive, or have access to Confidential Information. Each party and its Representatives shall use such Confidential Information solely for the purposes of performing such party’s obligations hereunder and shall keep the Confidential Information confidential and shall not disclose any such information except as provided in this Agreement.  Confidential Information may be disclosed to the Representatives of the Receiving Party, provided that knowledge of the Confidential Information is required by such Representatives for the purposes of advising the Receiving Party regarding the performance of this Agreement.

 

ARTICLE 14 – GENERAL PROVISIONS

14.1 Client’s Public Disclosure Responsibilities. The Company may design educational and promotional materials into the software and send such to the Client for the Client to disseminate to its Customers.  Upon receipt of written notification from the Company of any suspension or termination of this Agreement, the Client agrees to discontinue the use of all of the Company’s promotional materials and properly remove said materials. The Client shall make no use of the Company’s software, without the Company’s prior written consent.  In no way shall the Client indicate that the Company’s services are an endorsement of the Client, its business or its business practices.

14.2 Compliance and Disclosure of Information. The Client shall provide such information and certifications as the Company may reasonably require to determine the Client’s compliance with the terms and conditions of this Agreement and applicable law, including, but not limited to, credit reports, personal and/or business financial statements, income tax returns, or such other information as Company may request.  The Client further agrees to provide to the Company such information as and when requested. 

14.3 Authority for Credit Verification.  The Client and the Guarantor(s) grant to the Company continuing authority to pull credit reports, conduct electronic credit checks and background investigations and inquiries concerning the Client, the Client’s owner(s) and the Guarantor(s) including, but not limited to, character and business references and the financial condition of the Client, the Client’s owner(s) and the Guarantor(s).  The Client and the Guarantor(s) expressly authorize the Company or its Representatives to provide and receive such information from all third parties directly, without further consent or authorization on the part of the Client or the Guarantor(s).

14.4 Data Retention.  The Client and the Company shall retain all records related to authorization for a period of no less than two (2) years following the termination of this Agreement.

14.5 Information Storage. All information relating to the account of the Client may be recorded or stored by the Company in such form and by means of such devices as the Company may see fit.  The Company is under no obligation to retain original documents, instruments or vouchers other than those belonging to or entrusted to the Company by the Client.  The Company may use the services of any electronic data processing service bureau or organization in the connection with keeping any account of the Client.  The Company shall not be liable to the Client due to any act or omission of such service bureau or organization in the performance of the services required of it. The Company agrees to maintain compliance and provide proof of such to the Client upon request. The Client may, at any time, request documentation and proof of the security measures taken by the Company to protect the data and records entrusted to it.

14.6 Audit.  The Client agrees to permit the Company to audit the Client’s Transaction data upon reasonable notice.

14.7 Non-Waiver.  Neither the failure nor any delay on the part of the Company to exercise any right, remedy, power or privilege hereunder shall operate as a waiver thereof or give rise to an estoppel nor be construed as an agreement to modify the terms of this Agreement, nor shall any single or partial exercise of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence.

14.8 Assignment.  The Client may not assign or transfer any rights under this Agreement unless and until it receives the prior written approval of the Company.  The Company may assign or transfer any of its rights under this Agreement to its clearing institution without prior notice to the Client.

14.9 Entire Agreement.  This Agreement, including all schedules, exhibits, appendices or attachments appended to or delivered pursuant to this Agreement or the Merchant Application & Agreement shall form part of this Agreement to form the  complete and exclusive agreement between the Company and the Client with respect to the subject matter hereof and supersedes any prior agreement(s) between the Company and the Client.  In the event that the performance of the Services provided herein in accordance with the terms of this Agreement would result in a violation of any present or future statute, regulation or government policy to which Company, any Originating Depository Financial Institution, or any clearing institution is subject, then this Agreement shall be deemed amended to the extent necessary to comply with such statute, regulation or policy.

14.10 Amendments.  Amendments to operations or procedures shall become effective upon receipt by the Client of written notice from the Company, as provided for herein, or upon such date as may be provided in the Rules referenced in any such written notice, whichever is earlier in time.  In the case of any other amendments or waivers, no such amendment or waiver of this Agreement, or any part thereof, shall be binding unless executed in writing by the party to be bound thereby and no such amendment or waiver shall extend to anything other than the specific subject matter thereof.

14.11 Strict Performance Not Required.  The failure at any time of any party to insist upon strict performance of any provision of this Agreement shall not limit the ability of that party to insist at any future time whatsoever upon the performance of the same or any other provision, except insofar as that party may have given a valid and effective written waiver or release.

14.12 Binding Agreement.  This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective legal representatives, successors and assigns.

14.13 Legal Fees.  In the event that it becomes necessary for the Company to retain legal counsel to enforce, interpret, litigate, defend, mediate or arbitrate this Agreement or any issues or matters arising from, relating to or in connection with this Agreement or the Client (even if not relating to this Agreement), including (but not limited to) any investigation, inquiry, audit, action, charge, claim or suit brought or initiated by any Governmental Authority, the Client agrees and acknowledges that the Company shall be entitled to recover its actual fees, costs, and disbursements related to any such dispute or proceeding from the Client.

14.14 Governing Law, Venue, & Jurisdiction.  Notwithstanding any language to the contrary, all issues related to the electronic processing of Transactions under the terms of this Agreement shall be determined in accordance with the Rules.  All other matters shall be governed by the laws of the Province of Ontario, and the laws of Canada as applicable in that province, and the parties hereby attorn to the exclusive jurisdiction of the Ontario Superior Court of Justice.

14.15 Interpretation.  This Agreement shall be construed and interpreted in accordance with the laws of the Province of Ontario.

14.16 Headings.  All headings in this Agreement are included for referenced purposes only.  They shall not be deemed to be part of this Agreement and shall not be understood in any way to affect its interpretation.

14.17 Severability.  If any provision of the Agreement is determined to be illegal, invalid, or unenforceable, in whole or in part, by a court of competent jurisdiction from which no further appeal lies or is taken, or by a statute, regulation or any of the Rules, then such provision shall be deemed to be severed from this Agreement and the remaining provisions shall not affected thereby.  All remaining provisions, or parts thereof, shall remain in full force and effect and this Agreement shall be deemed modified to the extent necessary for such remaining provisions to remain enforceable.

14.18 Counterparts.  This Agreement may be executed manually or by facsimile signature and may be executed in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and such counterparts shall together constitute one and the same instrument.  To the extent that this Agreement is executed by facsimile signature, the parties who so execute shall forthwith deliver to the other parties manually executed copies thereof.  It shall not be necessary in making proof of this Agreement to produce more than one counterpart.

14.19 Canadian Anti-Spam Legislation.  The Client hereby gives authorization to Company to communicate via email transmission in delivery of the services contained herein and any other communication the Company may see fit in forwarding to Client.  Email communications sent to Client will only be done by an employee or department of Company. Client may unsubscribe to such emails when terminating this Agreement. The Company website is www.acceptpayglobal.com and to unsubscribe, Client may send an email to support@acceptpayglobal.com or 1-800-424-8551.

14.20 Effective Date. This Agreement shall be effective only upon execution and acceptance by Company.

 

In their personal capacity, the undersigned, being directors of the Client, have read, understand and acknowledge the terms and provisions of this Agreement, including the Guarantee in Section 9.2 hereof and shall comply in all respects with the terms contained herein, both in a personal and corporate manner.  The undersigned hereto acknowledge that they: (a) have each had sufficient time to review and consider this Agreement thoroughly; (b) have read and understand the terms of this Agreement and the obligations hereunder; (c) have been given an opportunity (and have been encouraged) to obtain independent legal advice, or such other advice as they may desire, concerning the interpretation and effect of this Agreement; and (d) agree to be bound by the terms of this Agreement as of the date first set forth in the Agreement.