Harbortouch ATM ISO Setup Information: Company Name: Address: City: State: Zip: Business Phone: Fax: Email: Mobile Phone: Website Address: Legal Status: Sole Proprietor Partnership LLC Corporation Federal Tax ID#: Bankcard Industry Reference: Principal Information Attach Driver s License Principal # 1 Name: Title: Address: City: State: Zip: Phone: Social Security #: Principal # 2 Name: Title: Address: City: State: Zip: Phone: Social Security #: Banking Information Attach Voided Check Bank Name: Account Number: Transit No: 1 Initials:
Independent Sales Organization Agreement This Independent Sales Organization Agreement ("Agreement") is made on,200 ("Effective Date") by and between Harbortouch ATM., an Massachusetts corporation with offices at 2202 North Irving Street, Allentown, PA 18109 ("HTATM"),and a corporation with offices located at ("ISO"). Recitals Harbortouch ATM provides sponsorship and processing services in certain debit card networks for ATMs. ISO markets debit card point of sale and/or ATM transaction services to merchants. ISO desires Harbortouch ATM to sponsor ISO and ISO's customers into certain debit card networks, and to provide certain services to those merchants relating to debit card transactions. Therefore, the parties agree as follows: I. Definitions The following terms when used in this Agreement will have the meanings set forth in this Section: "Adjustment" means an electronic message initiated by a Debit Network member to correct a Transaction which did not settle for the amount recorded by the Terminal or which is disputed by a Debit Card holder. "Confidential Information" means information owned by each party including, but not limited to, technical or non-technical data, a formula, pattern, compilation, program, device, method, technique, schematic, drawing, process, financial data, or list of actual or potential customers or suppliers which derives economic value, actual or potential, from not being generally known to other persons who can obtain economic value from its disclosure or use. "Debit Card" means a valid and unexpired card bearing the symbols of the Debit Networks. "Debit Networks" means the electronic funds transfer networks indicated on Exhibit A, and any entity that owns such networks, including but not limited to Visa and MasterCard. "Event of Default" means the events listed in Section 7.3. "Merchant" means a business that has entered into a Merchant Agreement and to which ISO provides services under this Agreement. "Merchant Agreement" means the written contract, a form of which is attached as Exhibit R required by HTATM to be entered into by a merchant to enable a merchant to participate in the Merchant Program. "Merchant Loss" means any loss incurred by HTAMT or Sponsor Bank for any reason attributable to a Merchant, including but not limited to losses due to the fraudulent practices of a Merchant, uncollected Merchant fees, and fines imposed by a Debit Network due to Merchant's noncompliance with the Rules. "Merchant Program" means the package of services offered by ISO, sponsored by HTATM, which enables a merchant to make sales to persons presenting Debit Cards. "Operating Account" means the deposit account established and maintained by ISO at an ACH receiving depository institution for the purpose of debiting and crediting ISO for all amounts detailed in this Agreement "Rules" means the written regulations and procedures issued by the Debit Networks. "Sponsor Bank" means that financial institution designated by HTATM that is a member of the Debit Networks. "Terminal" means an ATM or point of sale device connected to a Debit Network deployed or operated by 2 Initials:
ISO under this Agreement. "Transaction" means the purchase by a cardholder of goods or services from a Merchant, or a balance inquiry, withdrawal, deposit, or other function permitted by a Debit Network at an A TM, by use of a Debit Card. II. ISO's Obligations 2.1 Responsibilities of ISO. ISO will perform the following responsibilities: A. Locate, investigate and refer potential A TM or point of sale merchants to HTATM. B. Assist merchants in completing all documentation required to apply to the Merchant Program, and maintain signed Merchant Agreements and Merchant applications. ISO will not alter any term on any Merchant Agreement without HTATM prior written consent. ISO shall provide copies of such documents to HTATM and Sponsor Bank, their auditors and their examiners upon request. C. Perform site inspections within the times and utilizing the reporting forms required by HTATM. D. Evaluate potential merchants, and forward to HTATM the applications of only those businesses that comply with the credit criteria. E. Train Merchants (and new employees of Merchants, when necessary) on the procedures and Rules necessary to participate in the Merchant Program and the operation of Terminals. F. Input all data necessary to set up new Merchants. G. Sell, lease or place ATM Terminals and other equipment necessary to participate in the Merchant Program to Merchants. H. Install, maintain, and train Merchants on the use of Terminals and other Equipment, unless HTATM and ISO have agreed to use third-party installation providers. I. Distribute and deliver all Merchant supplies necessary for the Merchant to perform its duties under the Merchant Agreement. J. Provide HTATM a list of all sales agents and sales locations, both as of the Effective Date and within 30 days of any additions or deletions. 2.2 Adverse Information. ISO will inform HTAMT of information of which it has actual knowledge that may affect a potential Merchant's ability to meet a Merchant's obligations under the Merchant Program. Further, ISO will notify HTAMT in writing if ISO becomes aware of any information: A) about the financial insolvency, financial instability, or change in ownership or business of any Merchant, B) about a Merchant's noncompliance with the Rules, or C) that indicates that a Merchant's acceptance of Debit Cards is other than a bona fide sale of products or services. 2.3 Financial Statements and Audits. A. Audits. ISO will keep complete and accurate books and records relating to all transactions under this Agreement. HTATM, Sponsor Bank, Debit Networks, and regulatory agencies may at any time conduct financial and procedural audits of ISO to confirm compliance with this Agreement and the Rules. ISO will promptly supply such auditors with information requested by them. ISO will provide UCS with a copy of any audits performed by a third party or regulatory agency. 2.4 Information. ISO will promptly distribute to its sales agents changes in operations and Rules received from HTATM that may affect the manner in which services are marketed by such representatives. ISO will keep accurate records regarding Merchants' inquiries, orders, transactions and contacts under this Agreement. ISO will promptly advise HTATM of adverse or material changes in any Merchant's financial condition. 3 Initials:
III. UCS Responsibilities 3.1 UCS Responsibilities. HTATM will perform the following functions: A. HTATM will approve or deny, within its sole discretion, the participation of ISO's customers in the Merchant Program. Merchants will have a contractual relationship with HTATM and Sponsor Bank. B. HTATM will perform the ATM sponsorship services set forth in Exhibit D, if so indicated on Exhibit D. C. HTATM will respond to Merchants' inquiries regarding processing, settlement, D. HTATM will provide customer service and technical support for merchant and ISO issues relating to the ATM program. E. HTATM will offer cash replenishment and vault cash services. F. HTATM will provide transaction processing services. G. HTATM will respond to network disputes including regulation E inquiries. H. HTATM will provide a variety of sales support services including ATM leasing, ATM sales, placement programs, supplies, etc. I. HTATM will provide nationwide installation and maintenance. 3.2 Merchant Losses. The parties understand and agree that Merchant Losses will be borne by HTATM, unless a Merchant Loss is the direct or indirect result of ISO's fraud, breach of this Agreement, or willful misconduct, in which case the Merchant Loss will be owed by ISO to HTATM. 3.3 Ownership of Merchant Agreements. All right, title and interest to all Merchant Agreements is vested in HTATM. Notwithstanding the previous sentence, any time after ISO's residual compensation under this Agreement reaches $300 per month for the most recent 3 consecutive months, ISO may sell, assign or transfer its rights to receive compensation pursuant to Section 4.2 to any third party provided, however, that HTATM shall have a right of first refusal with regard to such sale, assignment or transfer. Within 30 days of ISO's written notice to HTATM specifying the terms of a bone fide third party offer for ISO's rights under Section 4.2, HTATM shall have the right to notify ISO of its exercise of such right of first refusal. HTATM shall be entitled to purchase such rights on the same terms and conditions specified in ISO's written notice within 60 days of HTATM exercise of the right of first refusal. ISO, nor any entity in which ISO or any ISO principal is an owner, director, or employee, shall not, during the term of this Agreement or after termination, solicit, entice or contract with any Merchant for services similar to those provided by HTATM under this Agreement or under any Merchant Agreement. IV. Fees and Charges 4.1 Merchant Fees. ISO will submit to UCS and will obtain HTATM approval of all fees charged to Merchants. ISO will not impose or collect any fee from any Merchant that has not been approved by HTATM. 4.2 ISO Compensation. Each month ISO will receive from HTATM compensation in accordance with the attached Pricing Schedule A. Such compensation may be amended by HTATM at any time after the first 12 months of this Agreement upon 30 days prior written notice to ISO. If ISO solicits or encourages any Merchant to terminate the Merchant Agreement, all of ISO's rights to receive compensation will cease. 4.3 Pass Through Fees. HTATM reserves the right to pass through to ISO or to Merchants certain existing or additional fees imposed or increased by any Debit Network. 5.1 Debit Network Requirements. V. Third Party Requirements A. Fines. ISO will reimburse HTATM within 5 business days for any fines imposed upon HTATM due to 4 Initials:
noncompliance on the part of ISO with any of the Rules. B. Locations. ISO has disclosed and will continue to disclose to HTATM the identity and location of each Terminal. C. Priority of Rules. HTATM and ISO agree that, in the event of any inconsistency between this Agreement and any Rules, the Rules will apply. D. Rule Compliance. ISO acknowledges that it has received, understands, and that it agrees to comply fully with all applicable Rules. E. No Delegation. ISO will not delegate any of its rights or obligations under this Agreement to any other person or entity. F. Records. Upon request, ISO will provide records containing Merchant information to HTATM, any Debit Network or any regulatory agency as soon as possible but no later than 7 days from ISO's receipt of a request for such information. G. Merchant Fee Disclosure. All merchant fees must be clearly and conspicuously disclosed to the Merchant in writing prior to any payment or application. H. Contact. ISO must promptly volunteer a name or title of and a telephone number for an employee of UCS upon request of a merchant, or if the ISO is unable or unwilling to respond to a merchant question. 5.2 Notification. Each party will promptly notify the other if it receives notice from any Debit Network or governmental agency that may affect that party's performance under this Agreement. VI. Representations and Warranties and Confidentiality 6.1 Representations and Warranties. Each party represents and warrants to the other that: A. Good Standing it is a corporation authorized, validly existing and in good standing under the laws of the state indicated in the opening paragraph, and has its principal office located in such state. B. Full Authority. It has full authority and corporate power to enter into this Agreement and to perform its obligations under this Agreement. C. No Violation. Its performance of this Agreement will not violate any applicable law or regulation or any agreement to which it may now or hereafter be bound. D. Enforceability. This Agreement represents a valid obligation of that party and is fully enforceable against it according to its terms. E. Compliance. It will comply with the terms of this Agreement, with the Rules, and with all applicable state and federal laws and regulations. F. No Litigation. That party and its officers and directors are not a party to any pending litigation that will affect its performance of this Agreement and have never been fined or penalized by any Debit Network. 6.2 Confidentiality. ISO and HTATM each agree that it will retain in strictest confidence the Confidential Information and all information and data belonging to or relating to the business of the other party (including without limitation the terms of this Agreement), and that each party will safeguard such information and data by using the same degree of care and discretion that it uses to protect its own confidential information. No party will use the other party's Confidential Information for its own benefit other than for the purposes contemplated by this Agreement, nor will it allow any third party to use such information. VII. Term, Termination, Default 7.1 Term. This Agreement will become effective on the Effective Date, and will remain in effect for a period of 5 years from the Effective Date ("Initial Term"). This Agreement will automatically renew for 5 5 Initials:
year periods ("Renewal Term") unless terminated earlier in accordance with the provisions of this Agreement. 7.2 Termination. Notwithstanding the above, the parties will have the following rights. A. Automatic Termination. This Agreement will automatically terminate if: (i) any Debit Network prohibits ISO from providing, or prohibits HTATM from allowing ISO to provide, the services set forth in this Agreement, or (ii) HTATM contract with Sponsor Bank terminates. B. Termination For Cause. Any party may terminate this Agreement immediately upon the occurrence of an Event of Default. 7.3 Default. Each of the following occurrences will constitute an Event of Default under this Agreement: A. Nonpayment. Any party fails to pay the other when due any amount due under this Agreement and such failure continues for a period of 15 business days after written notice has been sent to the nonpaying party. B. Financial Instability. Any party: (i) files for bankruptcy, receivership, insolvency, reorganization, dissolution, liquidation or any similar proceeding, (ii) has such a proceeding instituted against it and such proceeding is not dismissed within 60 days, (iii) makes an assignment for the benefit of its creditors or an offer of settlement, extension or composition to its creditors generally; or (iv) a trustee, conservator, receiver or similar fiduciary is appointed for that party or substantially all of that party's assets. C. False Representation. Any representation or warranty made by a party or any of its employees, officers, or directors proves to have been false or misleading in any material respect as of the date made, or becomes false or misleading at any time, including but not limited to material misrepresentation of information on Merchant applications. D. ISO Action. HTATM reasonable, good faith determination that ISO's action or omission may result in financial risk to HTATM. 7.4 Certain Post-Termination Rights. A. Other Rights. No termination of this Agreement will affect any right of: 1) HTATM with regard to the collection of Adjustments, fees owed, or ISO liabilities, or 2) ISO with regard to Merchant Agreements. B. Compensation. Upon termination of this Agreement for any reason, ISO will continue to receive compensation from HTATM, provided ISO has received compensation in the amount of at least $300 per month for the most recent 3 consecutive months. If ISO solicits or encourages any Merchant to terminate the Merchant Agreement, all of ISO's rights to receive compensation under this Agreement will cease. VIII. Names and Trademarks 8.1 HTATM Name. Neither party will use the other's name in any promotional or marketing materials, nor will it promote the other's programs in any way, without the other's consent. ISO acknowledges and agrees that the trademarks owned by HTATM are registered trademarks of HTATM and that it has no rights to use such trademarks without HTATM consent. All correspondence, materials and/or oral solicitations directed by ISO to customers, or produced by any third party, concerning HTATM programs must prominently identify HTATM by its name and the city in which HTATM is located. 8.2 Debit Network Trademarks. ISO acknowledges that the Debit Networks are the sole owners of their trademarks. ISO will not contest the ownership of such marks, and the Debit Networks may at any time and immediately without advance notice prohibit ISO from using its marks for any reason. ISO may not use Debit Network trademarks on any material without HTATM prior written consent. All material that uses Debit Network trademarks must clearly identify ISO as HTATM agent or representative. ISO will 6 Initials:
have no authority to permit use of the trademarks owned by the Debit Networks, or UCS by any of its own agents. Solicitation material used by ISO must clearly disclose that any Merchant Agreement will be between the Merchant, ISO and HTATM. IX. Indemnification and Limitation of Liability 9.1 Indemnification. ISO agrees to indemnify, defend and hold harmless HTATM and the Debit Networks and their officers, directors, employees, agents, affiliates, and assigns from and against any and all losses, costs, claims, damages, fines, penalties, expenses (including reasonable attorney's fees), or liabilities they may incur as a result of (a) any failure by ISO, or by any entity that ISO controls or contracts with (including Merchants), to fulfill any of ISO's or Processor's duties under this Agreement, under the contract with the Processor, or under the Rules; (b) any failure by a Merchant to fulfill any of its duties under the Merchant Agreements or the Rules or any action of any Merchant; (c) any failure to comply with applicable laws, rules or regulations; (d) otherwise resulting from UCS sponsorship of ISO; (e) any Merchant Loss; or (f) any action by any Merchant arising out of HTATM decision to terminate such Merchant. HTATM, having only undertaken to act as a sponsor for ISO to the Debit Networks, shall not be liable for any acts or omissions on the part of ISO or any third party (including Merchants) whether with respect to Transactions generated through Terminals or otherwise, and shall not be responsible for any losses or damages incurred by ISO or others in connection with. the operation of Terminals. ISO further covenants and agrees to indemnify and hold harmless the Debit Networks, their parent or affiliates, and their respective officers, directors, employees and permitted assigns, from and against any and all direct or contingent liabilities, claims, damages, losses or expenses, including reasonable attorneys' fees, arising from any claim, demand or suit against the Debit Networks as a result of any misrepresentation, breach of warranty or non-fulfillment of any covenant of this Agreement, to the extent said liabilities, claims, damages, losses and expenses are a result of the acts or omissions of ISO or Merchants, and to indemnify and hold harmless the Debit Networks as set forth in the Rules. 9.2 Limitation of Liability. The liability, if any, of HTATM under this Agreement for any claims, costs, damages, losses and expenses for which it is or may be legally liable, whether arising in negligence or other tort, contract, or otherwise, will not exceed in the aggregate the amount of any revenue received by HTATM under this Agreement for the preceding 3 month period, measured from the date the liability accrues. In no event will HTATM or its agents, servants, representatives or employees be liable for indirect, special, or consequential damages, nor will they be responsible for any losses or claims by Merchants. 10.1 Assignability; Sale or Merger. X. General A. Assignment. ISO may not assign its rights under this Agreement and any unauthorized assignment will be null and void. B. Purchase. If ISO enters into a purchase or stock exchange agreement with a third party which would effectuate a sale or merger of ISO's business, HTATM will have the right to terminate this Agreement immediately. 10.2 Notice. All communications under this Agreement will be in writing and will be delivered in person or by mail courier, return receipt requested, addressed to the addresses set forth in the opening paragraph of this Agreement, to the attention of: if to ISO: Attn: President. If to UCS: Attn: President. The parties may, from time to time, designate different persons or addresses to which subsequent communications will be sent by sending a notice of such designations in accordance with this Section. 10.3 Entire Understanding, Amendment. This Agreement, including the attached Exhibits which are incorporated by reference, sets forth the entire understanding of the parties relating to its subject matter, and all other understandings, written or oral, are superseded. Except as otherwise provided in this Agreement, this Agreement may not be amended except in writing, executed by both parties. 7 Initials:
10.4 Severability. If any provision of this Agreement is illegal, the invalidity of such provision will not affect any of the remaining provisions, and this Agreement will be construed as if the illegal provision is not contained in the Agreement. This Agreement will be deemed modified to the extent necessary to render enforceable its provisions, and to comply with the Rules. 10.5 No Waiver of Rights. No failure or delay on the part of any party in exercising any right under this Agreement will operate as a waiver of that right, nor will any single (partial exercise of any right preclude any further exercise of that right. 10.6 Successors and Assigns. This Agreement will inure to the benefit of and will be binding upon the parties and their respective permitted successors and assigns. This Agreement will not be deemed to be for the benefit of any third party. 10.7 Applicable Law. The Agreement will be deemed to be a contract made under the laws of the State of New Jersey, and will be construed in accordance with the laws of New Jersey without regard to principles of conflicts of law. 10.8 Independent Contractors. HTATM and ISO will be deemed to be independent contractors and will not be considered to be agent, servant, joint ventures or partner of the other. 10.9 Construction. The headings used in this Agreement are inserted for convenience only and will not affect the interpretation of any provision. All sections mentioned in the Agreement reference section numbers of this Agreement. The language used will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party. 10.10 Force Majeure. Neither party will be liable to the other for any failure or delay in it performance of this Agreement in accordance with its terms if such failure or delay arises out of causes beyond the control and without the fault or negligence of such party. 10.11 Survival. All agreements that by their context are intended to survive the termination of this Agreement, including but not limited to Sections 2.3, 4.2, Article VI, Section 7.4, Article VIII, and Article IX will survive termination of this Agreement. Harbortouch ATM ISO (Name of ISO) By: Name: Steve Skrzenksi Title: Operations Manager By: Name: Title: Exhibit A Debit Networks Harbortouch ATM is sponsored by Prosperity Bank into all of their available Regional and National ATM and POS Debit networks. Exhibit B Form of Merchant Agreement See Attached ATM Merchant Agreement 8 Initials: