Last modified: November 1st, 2023
MEMBER
BANK DISCLOSURE
Member Bank (Acquirer) Information: One or
more of the Member Banks (Acquirers) listed here: www.finix.com/legal/acquirers
Important Member Bank (Acquirer)
Responsibilities:
·
A
Visa member is the only entity approved to extend acceptance of Visa products
directly to a merchant.
·
A
Visa member must be a principal party to the merchant agreement.
·
The
Visa member is responsible for, and must provide settlement funds to, the
merchant.
·
The
Visa member is responsible for all funds held in reserve that are derived from
settlement.
·
The
Visa member is responsible for educating merchants on pertinent Visa Rules with
which merchants must comply.
Important Merchant Responsibilities:
·
Ensure
compliance with cardholder data security and storage requirements.
·
Maintain
fraud and disputes below thresholds.
·
Review
and understand the terms of the merchant agreement.
·
Comply
with Visa Rules.
The responsibilities listed above do not
supersede terms of the merchant agreement and are provided to ensure the
merchant understands important obligations of each party and that the applicable
Acquirer is the ultimate authority should the merchant have any problems.
These Finix General Terms of
Service (“General Terms”) are
entered into between Finix Payments, Inc., a Delaware corporation (“Finix”); one or more Banks; and the
merchant (“Merchant”) that submitted
an Application. By accessing or using any of the
Services, Merchant agrees to comply with these General Terms, the Application,
all Services Schedules, the Documentation, and any other terms and conditions provided by Finix (which may be provided through the Finix
Dashboard, if applicable) (collectively, the “Agreement”). Finix
and Bank may be collectively referred to as “Processor” and may jointly or individually assert or exercise any
rights or remedies provided hereunder. Each of Finix, Bank, and Merchant is a “Party,” and are collectively the “Parties.”
By clicking “I Accept” or providing similar
acknowledgement of this Agreement (the date of which shall be the “Effective
Date”), or by accessing or using the Services, Merchant agrees that it has
reviewed and understands all disclosures made available to it, and Merchant
agrees to this Agreement and the Finix Privacy Policy. Each Party agrees that
the electronic signatures and equivalent indications of acceptance by the
Parties executing this Agreement are intended to authenticate this Agreement on
behalf of each Party, and will have the same force and effect as manual
signatures. By accepting this Agreement or using any
Service, Merchant consents to the electronic communications requirements
described in Section 14.1 of these General Terms.
If
there is any conflict between these General Terms and the terms of any Services
Schedule or other terms and conditions provided by Finix in connection with
Merchant’s use of the Services, then unless terms of lower precedence expressly
state to the contrary, the order of precedence is: (a) the Services Schedules;
(b) these General Terms; and (c) all other terms incorporated by reference into
this Agreement, including any additional terms provided through the Finix
Dashboard. Capitalized terms in the Services Schedules, any other terms
incorporated by reference into this Agreement, or any notice given under or in
connection with this Agreement, but not defined therein, will have the meanings
ascribed to them in these General Terms.
THIS AGREEMENT CONTAINS PROVISIONS THAT
GOVERN HOW DISPUTES BETWEEN THE PARTIES ARE RESOLVED, WHICH INCLUDE AN
AGREEMENT TO SUBMIT ANY DISPUTE RELATED TO THIS AGREEMENT OR THE SERVICES TO
BINDING INDIVIDUAL ARBITRATION RATHER THAN PROCEEDING IN COURT. THIS AGREEMENT
ALSO INCLUDES A CLASS ACTION WAIVER, WHICH MEANS MERCHANT AGREES NOT TO PROCEED
WITH ANY DISPUTE AS PART OF A CLASS ACTION.
1.1. Use of Services. Merchant will use the Services for
business purposes only and not for any personal, family, or household purposes.
Merchant agrees that it may not submit Transaction instructions on behalf of
third parties. Processor will provide the Services for Transactions submitted
from Merchant retail locations and e-commerce websites operating in the United
States. Merchant represents and warrants
that it is engaged in the business of providing goods and/or services to its
Customers at location(s) or websites owned or leased and operated by Merchant (or
through a Partner Platform, in the case of Platform Merchants) within the
United States. Merchant agrees to use the Services (i) to accept Cards and/or
ACH as a means of payment from its Customers for goods and services sold or
charitable donations received by Merchant; (ii) to make Disbursements to its
Merchant Payees, and/or (iii) to authorize Processor to originate ACH debit and
credit Entries to and from Merchant’s accounts as means of payment and
settlement, in each case in compliance with the requirements of this Agreement.
With respect to all Transactions, Merchant represents and warrants that: (i)
each Customer has authorized the debiting and/or crediting of its account; (ii)
each Transaction is for an amount the Customer has agreed to; (iii) each
Transaction is in all other respects properly authorized; (iv) each sales Transaction
occurs in connection with a bona fide purchase of goods or service from Merchant
by a Customer that has been or will be completed in accordance with Merchant’s
underlying agreement with the Customer and the Rules; and (v) Merchant does not
operate a Prohibited Business.
1.2.
Bank’s
Role. Bank is a member of various Card Brands and the
Federal Reserve permitting it to acquire Card Transactions and initiate ACH
Transactions on Merchant’s behalf. Bank
sponsors Finix under the Rules and also serves as the ODFI
for ACH Transactions transmitted through the ACH Network, allowing Finix to
process payment authorizations, transmissions, and settlement activities for Card
Transactions, ACH Transactions and Disbursements under Bank’s direction. All
funds transfers are performed by Bank based on Finix’s instructions. Any Settlement
Funds or other amounts received from Merchant in connection with the Services
sponsored by Bank shall be maintained in a pooled custodial account held by
Bank. Finix’s actions in connection with funds transfers are done on behalf of
and as a service provider to Bank and Merchant. At no point during the payment
process or otherwise does Finix receive, hold or transmit Settlement Funds or
other Merchant funds. As a technology partner, Finix implements functions on
behalf of Bank and provides ancillary services to Merchant. Bank’s
responsibilities under this Agreement are limited solely to the sponsorship and
settlement of Card Transactions, ACH Transactions and Disbursements submitted
in accordance with this Agreement and the Rules, and Bank will not have any
obligation or liability of any nature in connection with any instructions or services
of any kind provided by Finix or its affiliates or subcontractors. Except for
Bank’s specific responsibilities described in this Section 1.2, Finix is solely
responsible for the Services. Bank may be changed by Finix at any time
with notice to Merchant.
1.4. Sole Proprietors.
If Merchant is organized as a sole proprietorship, Merchant expressly
acknowledges and agrees that the sole proprietor responsible for Merchant’s
business may be held personally liable and responsible to Processor for all of
Merchant’s obligations under this Agreement, including, without limitation,
Merchant’s payment obligations and obligations to Customers.
1.5. Merchant Support.
Finix (or a Partner Platform, in the case of Platform Merchants) will provide
Merchant with support for general issues relating to Merchant’s use of the
Services through the Finix Dashboard and the Documentation.
2.1.
Compliance
with Applicable Law and the Rules. Merchant agrees to comply with Applicable Law and the Rules in
connection with this Agreement. With respect to Recurring Transactions,
Merchant will ensure that any such payments comply with the disclosure and
authorization requirements of Applicable Law, including, but not limited to,
the Electronic Funds Transfer Act and Regulation E, other applicable federal
and state laws, the Rules, and any other requirements applicable to
preauthorized or recurring payments. Merchant will provide Processor with
written notice not more than five (5) days after Merchant receives any
complaint, inquiry, subpoena, civil investigative demand, or similar request
for information from a Regulatory Authority or any other a federal, state, or
local government, agency, or entity relating to the Services or this Agreement.
2.2.
Notice
of Changes. Merchant will provide Processor with immediate notice in writing of (i) a
Change of Control of Merchant; (ii) its intent to change the nature of its
business, including the types of goods and services sold or the manner in which
sales are completed; (iii) a change to Merchant’s financial condition (within
three (3) days); (iv) any additional location or new business; (v) a
change in the identity of principals, officers, Beneficial Owners, or any other
individuals previously made known to Processor; or (vi) a change in the form of
business organization. Merchant will immediately notify Processor of any
bankruptcy, receivership, insolvency, or similar action initiated by or against
Merchant or any of its principals, and Merchant agrees that Processor may
exercise any rights set forth in this Agreement (including those of set-off) if
Merchant files for bankruptcy, including debiting of the Reserve Account.
Merchant will include Processor in the list of creditors filed with the bankruptcy
court, whether or not a claim exists at the time of filing. Except in the case
of a change to Merchant’s financial condition, Processor must receive all such
notices seven (7) days prior to the change and otherwise upon request from
Processor. Merchant is liable to Processor for all losses and expenses incurred
by Processor arising out of or related to Merchant’s failure to report changes.
Processor may immediately terminate this Agreement upon a change to the
information in the Application, whether Processor independently discovers such
change or whether Merchant notifies Processor of such change. Failure to
provide notice as required in this Section may be deemed a material breach and will
be sufficient grounds for termination of this Agreement, or, at Processor’s
option, may result in Processor amending the terms of this Agreement, holding
funds, and/or altering the Settlement Payout Schedule if Processor deems it
necessary to protect against financial loss. If any of the changes listed above
occur, Processor will have the option to amend the terms of this Agreement or
immediately terminate this Agreement.
2.3.
Merchant
Refund Policy. Merchant
agrees to maintain a written refund policy that complies with the Rules and
Applicable Law and to disclose such policy to Processor and all Customers.
Merchant will submit any changes to its refund policy to Processor in writing
at least thirty (30) days before the change and will not implement any change
to which Processor reasonably objects. If Merchant operates a website through
which sales are processed, Merchant must include its refund policy on the
website in accordance with the Rules and Applicable Law. Merchant will not make
a refund or adjustment in cash (except when required or permitted by Applicable
Law or the Rules) and will deliver to Processor all information reflecting such
refund or adjustment within three (3) days of the refund or adjustment. The
amount of any refund must not exceed the amount of the original Transaction
except for any amount which Merchant agrees to reimburse the Customer for
return postage. Merchant will not accept any payment from a Customer as
consideration for issuing a refund. Merchant is solely responsible for settling
any disputes between Merchant and its Customers. Processor will have no
responsibility in resolving or settling such disputes.
2.4.
Data
Security; Software.
Merchant will be solely responsible for the security and confidentiality of
Transactions processed by means of electronic commerce. Merchant will include
any information or disclosures required by the Rules or Applicable Law on
Merchant’s website or as otherwise specified by Processor. Merchant will be
solely responsible for its use of any fraud prevention services provided by any
third party or web software vendor selected by Merchant. Processor will not be
responsible for the security of or preventing fraud in electronic commerce
Transactions presented by Merchant or any third party providing electronic
commerce services to Merchant. Merchant will disclose to Processor and receive
prior approval for all third parties that have access to Customer Data. Merchant agrees to indemnify, defend, and hold
harmless Processor and its parent companies, subsidiaries, and Affiliates
(including, without limitation, the officers, directors, employees, attorneys,
shareholders, representatives, and agents of all of the foregoing) against all
losses from fraudulent activity related to electronic commerce (including
Chargebacks). If at any time Merchant determines or suspects that Customer Data
has been compromised, Merchant must notify Processor immediately and assist in
providing notification to such parties as may be required by Applicable Law or
the Rules, or as Processor otherwise reasonably deems necessary.
2.5.
Use
of Vendors and Service Providers. Merchant must notify Processor of its use of any third-party
vendor or service provider in connection with receiving or using the Services
or to the extent required by the Networks. All vendors and service providers
and software involved in processing, storing, receiving, or transmitting of
Customer Data must be (i) compliant with all Rules applicable to service providers;
and (ii) registered with and/or recognized by such Network, as applicable.
Merchant agrees to exercise due diligence to ensure that all vendors and
service providers, and any other agents, business partners, contractors, or
subcontractors with access to Customer Data maintain compliance with the Rules,
Applicable Law, and this Agreement.
2.6.
Third
Party Assessments and Pass-Through Costs. Merchant will be responsible for all amounts imposed, passed
through, or assessed against Finix or Bank in connection with this Agreement by
the Networks, processors, telecommunication companies, third party service
providers, or any other third party, including but not limited to Card Brand fees, interchange
fees, dues, and assessments (“Pass-Through Costs”). Finix may increase
the Fees automatically and effective immediately to reflect increases in Pass-Through
Costs, and such increased Fees will be immediately payable by Merchant when
assessed by Finix.
2.7.
Acceptance of Payments.. Merchant may accept Card, ACH, and other payments approved by Processor only at location(s) approved by Processor.
Additional locations may be added, subject to Processor’s approval. Processor may delete location(s) by providing notice as provided in this Agreement.
Merchant may not use any electronic authorization or data capture terminal
or device to process Transactions that has not been approved in writing by Processor.
3. USE OF FINIX TECHNOLOGY.
3.1.
Access
to Finix Dashboard. Finix
may provide Merchant with the ability to access an online, interactive
graphical user interface that provides Merchants with an overview of their
Finix accounts and tools to access and manage use of the Services (the “Finix
Dashboard”). Merchants may access the Finix Dashboard directly, or if a
Platform Merchant, through the Partner Platform, as may be applicable. Merchant
is solely responsible for reconciling information in the Finix Dashboard with its
transaction records and identifying any errors. Merchant agrees to promptly
notify Finix (or Partner Platform if applicable) of any errors. Finix will
investigate and, if appropriate, attempt to correct reported errors. Merchant’s
failure to report an error within sixty (60) days of it first appearing in the
Finix Dashboard will be deemed a waiver of any right to amounts that may be owed
to Merchant in connection with such error.
3.2.
License
and Restrictions. Subject at all times to Merchant’s full compliance
with this Agreement, Finix hereby grants Merchant a worldwide, revocable,
non-exclusive, non-transferable, non-sublicensable, and royalty-free license
during the Term to use and access the Finix Technology solely for accessing and
managing Merchant’s use of the Services for commercial purposes related to
Merchant’s business. Merchant will not (i) use the
Finix Technology to create any service, software, documentation, or other
material that performs substantially the same functionality as the Finix
Technology; (ii) disassemble, decompile, reverse-engineer or use any other
means to attempt to discover any source code, algorithms or trade secrets
underlying the Finix Technology or any of its components; (iii) impose (or
permit any third party to impose) any lien, security, or other encumbrance upon
the Finix Technology; (iv) adapt, combine, create derivative works of or
otherwise modify the Finix Technology; (v) disable, circumvent, or otherwise
avoid or undermine any security device, mechanism, protocol, or procedure implemented
in the Finix Technology; (vi) use or access the Finix Technology for any
unlawful, fraudulent, deceptive, malicious, or otherwise harmful or injurious
purpose; (vii) remove, obscure, deface, or alter any proprietary rights notices
on any element of the Finix Technology or Documentation; or (viii) use the
Finix Technology in any manner which could damage, disable, overburden, or
impair the Finix Technology or interfere with any third party’s authorized use
of the Finix Technology. Merchant will not utilize any software, hardware, or
other tool to scan or monitor the Finix Technology or Finix’s servers or
network infrastructure for the purpose of measuring or analyzing uptime,
operating systems, virtual environments, or other installed applications,
including without limitation for stress testing, load testing, or performance
benchmarking.
3.3.
Access
Credentials. Merchant is responsible
for securing and maintaining the confidentiality of any login or access
credentials to the Finix Technology, including without limitation those
provided by Finix or Partner Platform to Merchant to allow Merchant to access
or use the Dashboard, and Merchant will be fully responsible for all activities
that occur through the use of such credentials. Merchant agrees to notify Finix
immediately if Merchant believes the confidentiality of such credentials has
been compromised or if Merchant suspects unauthorized use of such credentials.
Finix and Bank will not be liable for any loss or damage arising from
Merchant’s failure to comply with this paragraph.
3.4.
Feedback. Merchant may provide Feedback to Finix from time to time through the
Dashboard or other means of communication acceptable to Finix. Finix will have full discretion to determine whether
or not to proceed with the development of the requested enhancements, new
features or functionality. Feedback, even if
designated as confidential by Merchant, will not create any confidentiality
obligation for Finix, notwithstanding anything else in this Agreement. Merchant
will, and hereby does, grant to Finix a non-exclusive, worldwide, perpetual,
irrevocable, transferable, sublicensable, royalty-free, fully paid up license
to use and exploit the Feedback for any purpose. Nothing in this Agreement will
impair Finix’s right to develop, acquire, license, market, promote or
distribute products, software or technologies that perform the same or similar
functions as, or otherwise compete with, any products, software or technologies
that Merchant may develop, produce, market, or distribute.
3.5.
Rights
Reserved. As
between the Parties, Processor retains all right, title, and interest in and to
the Services, and all software, products, works, and other intellectual
property and moral rights related thereto or created, used, or provided by Processor
for the purposes of this Agreement, including any copies and derivative works
of the foregoing. No rights or licenses are granted except as expressly and
unambiguously set forth in this Agreement.
4. FEES
4.1.
Fees;
Payment Obligation.
Merchant agrees to pay the Fees specified in the Finix Dashboard or as
otherwise provided by Finix (or Partner Platform if applicable), as may be
amended by Finix (or Partner Platform if applicable) from time to time. Finix
may instruct Bank to deduct Fees (including Platform Fees, if applicable) owed
by Merchant from (i) amounts due to Merchant under this Agreement (including from
Settlement Funds); (ii) the Settlement Account; or (iii) the Reserve Account.
Merchant will pay the amounts due by the next Business Day if sufficient funds
are not available in the Settlement Account or the Reserve Account.
4.2.
Fee
Increases. Finix (or
Partner Platform if applicable) may increase any or all parts of the Fees by
giving Merchant at least thirty (30) days advance written notice, except that the
Fees may be immediately increased without notice to reflect increases to any
Pass-Through Costs. Merchant agrees that the Fees may be based upon Merchant’s
estimated Transaction volume or other information provided by Merchant in the Application. Finix
(or Partner Platform if applicable) reserves the right to increase Fees (including
the rates at which they are calculated) if there is any material variance from
the information provided by Merchant in the Application or other information
(such as projected volume or average ticket size) upon which Fees were
initially determined.
4.3. Payments of Amounts Owed; Invoicing. Merchant agrees to pay amounts owed to
Processor, including for all (i) Fees assessed by Finix and other charges,
penalties, or other amounts owed by Merchant; (ii) all refunds, and
Chargebacks; (iii) all Disbursements, (iv) Reserve Account amounts; (v) fees,
charges, fines, assessments, penalties, or other liabilities that may be
imposed on Processor from time to time by the Networks in connection with
providing the Services, and all related costs and expenses incurred by
Processor. Chargebacks, Disbursements or losses from fraudulent activity are
the complete, full, and sole responsibility of Merchant. Processor may deduct,
recoup, or setoff all such Fees and other amounts Merchant owes under this
Agreement from Merchant’s Settlement Funds or Settlement Account. Merchant’s
obligation to pay is not contingent upon delivery of an invoice. If Finix
issues Merchant an invoice, Merchant agrees to pay the amounts set forth in such
invoice in accordance with the invoice instructions. If payment is not received
(or if an invoice is not paid in full), Finix may charge Merchant a late
payment fee at the lesser of one-and-one-half percent (1.5%) per month or the
highest rate allowable by law, in each case compounded monthly to the extent
allowable by Applicable Law. Finix will apply all payments beginning with the
oldest amounts due.
4.4. Refunds. Fees charged for executing the original Transaction will
not be refunded in part or in whole to Merchant if such Transaction is refunded
or made subject to a Chargeback.
4.5. Fee Disputes.
If Merchant, in good faith, disputes any portion of an invoice provided
by Finix, Merchant will pay the undisputed portion of the invoice and submit a
Fee Dispute Notice to Finix within sixty (60) days from the date the invoice at
issue is received by Merchant. Merchant waives the right to dispute any Fees
not disputed within such sixty (60) day period. The Parties will negotiate in
good faith to attempt to resolve any such disputes within sixty (60) days after
Merchant’s delivery of the applicable Fee Dispute Notice.
5.
TRANSACTION
SETTLEMENT; RESERVE ACCOUNT; CHARGEBACKS.
5.1. Transaction Settlement; Settlement Account. Merchant agrees to designate and
maintain a Settlement Account that accepts ACH transfers with a balance of
available funds sufficient to accommodate Merchant’s obligations under this
Agreement. When Bank receives Settlement Funds from a Network, Bank will hold
those Settlement Funds on Merchant’s behalf in a pooled custodial account at
Bank. Finix will instruct Bank to provide provisional credit to Merchant for
each valid Transaction processed for Merchant on a gross or net basis pursuant
to the Settlement Payout Schedule, provided that Bank has received settlement
for the valid Transaction from the applicable Network. Each Business Day, Bank,
upon instruction by Finix, will remit Settlement Funds from the pooled account
at Bank to Merchant’s designated Settlement Account less (i) any amounts
Processor is authorized to deduct or withhold under this Agreement, and (ii)
any Disbursements requested by Merchant from Settlement Funds. Merchant agrees
that the transfer of Settlement Funds to the Settlement Account or the Disbursement
of such funds on behalf of Merchant will discharge Processor of its settlement
obligations to Merchant. Processor is not obligated to provide provisional
credit to Merchant for Transactions that are not valid, and Processor may
suspend or discontinue any provisional credit in Processor’s sole and absolute
discretion. If there are not sufficient available funds in the Settlement
Account to cover Merchant’s obligations hereunder, Processor may make
deductions from Settlement Funds without notice.
5.2.
Refusal
to Process; Suspension of Settlement.
5.2.1.
Processor
reserves the right to refuse to process any Transaction or return for
correction any Transaction presented by Merchant if Processor reasonably
believes that the Transaction (i) may be uncollectible from the Customer; (ii)
violates this Agreement, Applicable Law, or the Rules; or (iii) may involve
Suspicious Activity. Processor will have no liability for any losses, either
direct or indirect, which Merchant may attribute to any suspension or refusal of
settlement for Transactions.
5.2.2.
If
Processor determines, in its sole and reasonable discretion, that a Transaction
may be the result of or may result in Suspicious Activity, Processor may take
such actions as Processor deems necessary to prevent or mitigate actual or
future risks of harm, including, but not limited to (i) suspension of
processing privileges; (ii) increase of any Fees that may be charged to
Merchant; and/or (iii) creation or maintenance of a Reserve Account in
accordance with this Agreement.
5.2.3.
Merchant
shall ensure that the rate of all Chargebacks does not exceed the percentage
thresholds permitted by the Rules. In the event Chargebacks exceed such
percentage thresholds, Merchant shall provide a detailed explanation to
Processor regarding such percentage. Processor, in its sole discretion,
may immediately terminate this Agreement or suspend the Services, in whole or
in part, if (a) Merchant fails to provide such explanation, or (b) if after
investigation of Merchant's explanation, Processor reasonably determines that
Merchant will be unable to reduce the excessive rate of Chargebacks within a
commercially reasonable period of time.
5.3. Reserve Account.
5.3.1. At any time and for any reason (including,
without limitation, notice of termination or actual termination of this
Agreement, unauthorized Transactions, cessation of business, insolvency,
Suspicious Activity, or competing claims regarding funds generated via
Merchant’s processing activities), Processor may require Merchant to establish
one or more Reserve Accounts for the Services, increase the funding amount of
an existing Reserve Account, or provide other security to pay amounts due or
anticipated under this Agreement. Merchant acknowledges that Processor may
require additional or separate Reserve Account(s) in connection with Merchant’s
receipt of Services under additional Services
Schedules to this Agreement. Processor may require
that such Reserve Account(s) be funded (whether initially or due to increased
funding requirements) immediately (including, without limitation, in instances
of unauthorized transactions, suspected or actual fraud, or termination for
cause). Processor may, without prior notice, establish and fund a new Reserve
Account or increase the funding of an existing Reserve Account by deducting
amounts from Settlement Funds or by charging the Settlement Account or any
other available account of Merchant; provided that Finix will notify Merchant
of the establishment or increased funding of the Reserve Account no later than
three (3) Business Days after doing so.
5.3.2. Except as otherwise agreed upon in writing
by the Parties, funds in the Reserve Account(s) will remain in the Reserve
Account(s) for a minimum of one hundred eighty (180) calendar days following
the date on which this Agreement is terminated and until such time as Processor
is satisfied that Merchant has no further obligations to Processor under this
Agreement; provided, however, that Merchant will remain liable to Processor for
all liabilities occurring during and beyond such 180-day period. After the
expiration of such 180-day period, Finix will notify Merchant when any funds
remaining in the Reserve Account(s) are eligible to be released, and Merchant
will promptly respond with instructions for how they should be returned to
Merchant.
5.3.3. Merchant’s failure to fund the Reserve
Account (whether initially or due to increased funding requirements) may result
in immediate suspension of Services or termination of this Agreement in
Processor’s sole discretion. Merchant has no legal or beneficial interest in
the Reserve Account, which funds are held for the benefit of the Networks and
Processor, until such time as the funds are released to Merchant. Processor
will have sole control of the Reserve Account if there is any bankruptcy
proceeding. If there is a bankruptcy proceeding, Processor may exercise its
rights under this Agreement to debit the Reserve Account for amounts due to the
Networks or Processor regardless of the pre-petition or post-petition nature of
the amount due Processor. If there is a bankruptcy proceeding, Merchant agrees
that it will not contest any motion for relief from the automatic stay, which
Processor may file to debit the Reserve Account; and funds in the Reserve
Account will remain in the Reserve Account following termination for such
timeframe as determined by Processor.
5.4. Security Interest. Merchant hereby grants Finix a lien and
security interest in all of Merchant’s right, title, and interest in or to any
of the following assets or properties: (i) the Settlement Account; (ii) all
Transactions and Settlement Funds; (iii) any rights to receive credits or
payments under this Agreement; (iv) if a court of law determines the funds in
the Reserve Account(s) are owned by Merchant, then the Reserve Account(s); and
(v) all deposits and other property of Merchant that Finix or its Affiliates
possess or maintain (including all proceeds of the foregoing). Merchant will
execute, acknowledge, or deliver any documents or take any actions Finix may
from time to time request to better assure, preserve, protect, perfect,
maintain, or enforce this security interest. To the extent permitted by law,
Merchant irrevocably authorizes Finix to file any financing statements (at
Merchant’s expense) in any relevant jurisdiction or any other documents or
instruments related to this security interest. Finix will also be the
beneficiary of any insurance, surety bond, or similar indemnity or guaranty
(whether voluntary or required by law) of Merchant or for the benefit of
Merchant’s Customers, and Merchant hereby assigns to Finix the rights to make
claims or receive the benefits thereof with respect to Transactions hereunder.
Merchant represents and warrants that (a) Merchant has good and valid rights
and title to the property described herein; (b) Merchant has full power and
authority to grant Finix the security interest pursuant hereto and to execute,
deliver, and perform its obligations in accordance with the terms of this
Agreement, without the consent or approval of any other person or entity; (c)
no other person or entity has a security interest or lien in any of the
property described herein; and (d) this security interest is a first lien
security interest and secures Merchant’s obligations to Finix under this
Agreement. Finix will have all rights of a secured party and Merchant must
obtain the prior written consent of Finix before granting any subsequent
security interest or lien in the property described herein. Merchant agrees
that it is Merchant’s intent that these accounts and secured property will to
the extent allowed by law not be subject to any preference, claim, or stay by
reason of any bankruptcy or insolvency law. Merchant agrees to act consistently
with the understanding that said accounts and secured property under this
Agreement are free of all such preferences, claims, or stays by reason of and
as allowed by any such law.
5.5. Authorization to Deposit and Withdraw from
Settlement and Reserve Accounts. Merchant authorizes Bank, upon instruction of Finix, to initiate
and make deposits and withdrawals to and from the Settlement Account, the
Reserve Account, and any account to which Processor has access which may be
transmitted electronically or accessed through ACH, or to delay or place holds
on any amounts in such accounts in order to pay amounts owed to the Networks or
Processor, or to protect any of Processor’s rights and to obtain, without any
further notice or demand, payment of any amount due to Processor under this
Agreement, including, without limitation, (i) Fees and other charges,
penalties, or other amounts owed by Merchant; (ii) all refunds and Chargebacks;
(iii) all Disbursements; (iv) Reserve Account amounts; (v) fees, charges,
fines, assessments, penalties, or other liabilities that may be imposed on
Processor from time to time by the Networks in connection with providing the
Services, and all related costs and expenses incurred by Processor; and (vi)
any funds sent to Merchant in error (which shall be considered funds owed to
Processor). Merchant agrees that any depository bank may comply with
instructions originated by Processor directing dispositions of the funds in
those accounts without any further consent required by Merchant unless required
by Applicable Law. If required, Merchant authorizes Processor to enter into any
agreement with any depository institution for this purpose, including on behalf
of Merchant, to effect the security interest granted to Processor above.
Merchant agrees to enter into any such agreement. Merchant will confirm to any
institution holding any account of Merchant the existence of this authorization
and direct it to comply with Processor’s directions. Merchant will not change
any such confirmation or direction without Processor’s prior written consent.
Any such confirmation, direction, or authorization will remain in effect for at
least one hundred eighty (180) days after termination of this Agreement or, in
Processor’s discretion, longer to process trailing activity. Processor reserves
the right to terminate or suspend any or all services under this Agreement at
any time if Merchant fails to maintain authorizations for Processor to debit
and credit the Settlement Account and Reserve Account as set forth in this
Section. Merchant is solely responsible for providing Processor with and
maintaining accurate contact, payment, and account information for each
Settlement Account, including any applicable tax information.
6.
PARTNER
PLATFORM ACCOUNTS AND SERVICES. The following additional provisions apply to Platform Merchants
that access the Services through a Partner Platform. For the avoidance of doubt, Platform Merchants are subject
to the terms and conditions in this Agreement generally applicable to Merchants,
in addition to those terms and conditions specifically applicable to Platform
Merchants.
6.1. Establishment of Partner Platform Accounts. The Finix Technology
allows a Platform Merchant to access the Services through an integration
between a Partner Platform and Finix. Finix may provide options for how
Platform Merchants sign up for and receive the Services, including through
Partner Platforms, as described in the Documentation. The Partner Platform is
solely responsible for the selection of the onboarding mechanism for each
Platform Merchant. Platform Merchant must at all times be a party to an
effective Partner Platform Agreement that addresses the provision of Services
under this Agreement through the Partner Platform. Finix will not be responsible
or liable to Platform Merchants for any services provided through or in
connection with the Partner Platform outside of the Services in this Agreement.
6.2. Use of Services.
Platform Merchant agrees that the Partner Platform may submit Transactions and
conduct other activity involving the Services on behalf of Platform Merchant
pursuant to the terms of the Partner Platform Agreement. Additional terms,
conditions, and limitations for Platform Merchant’s access to the Services may
be set forth in the Partner Platform Agreement. Platform Merchant agrees to
comply at all times with the Partner Platform Agreement. Platform Merchant
remains liable to Processor as set forth in this Agreement, regardless of any
other provisions set forth in the Partner Platform Agreement. Platform Merchant
agrees that Finix may rely on any information provided by Partner Platform on
behalf of Platform Merchant, regardless of its accuracy or completeness.
6.3. Platform Merchant Fees. Unless
otherwise agreed to by the Parties, the Partner Platform is responsible for
setting the Platform Fees charged to Platform Merchant for the Services and
disclosing them to Platform Merchant. The Platform Fees typically include the Fees
owed to Finix under this Agreement plus any additional fees charged by the
Partner Platform. Processor is not responsible for the Platform Fees. In
addition to Finix’s rights under this Agreement, if requested by the Partner
Platform, Bank, upon direction of Finix, may deduct from Platform Merchant’s
Settlement Funds or Settlement Account any Platform Fees or other amounts owed
to Processor under this Agreement or to Partner Platform under the Partner
Platform Agreement. The Partner Platform is solely responsible for determining
whether or not Platform Fees are refundable.
6.4. Communications with Platform Merchants. Platform Merchant will
transmit all Processing Data, notices, instructions, communications, and other
information required to be sent or communicated to Processor under this
Agreement through the Partner Platform, or in some cases through the Finix
Dashboard, in accordance with the terms and conditions of the Partner Platform
Agreement. Finix will send to Partner Platform all notices, communications, and
other information required to be sent by Processor to Platform Merchant under
this Agreement, and Partner Platform will be solely responsible for communicating
that information to Platform Merchant in accordance with the Partner Platform
Agreement, including, without limitation, all notices and information from
Processor concerning the Services, Chargebacks, Fee increases, Reserve Accounts,
Network requirements, and scheduled or emergency downtime. Platform
Merchant agrees that Partner Platform is solely liable and responsible for any
failure to provide effective notice to Platform Merchant through the Partner
Platform or the Finix Dashboard. Platform Merchant agrees that Platform
Merchant is solely liable and responsible to Processor if a Partner Platform
fails to transmit any information or communication to Processor required by
Platform Merchant under this Agreement.
6.5. Liability; Disclaimer. Platform Merchant is
solely responsible for any use of or access to the Finix Technology or Services
initiated by Partner Platform on Platform Merchant’s behalf or using Platform
Merchant’s credentials, including the accuracy and completeness of any
information transmitted by Partner Platform to Processor. Platform Merchant
will indemnify and hold Processor harmless from any losses incurred by Platform
Merchant or any third party based on unauthorized activity initiated by Partner
Platform, its employees, or its agents. If Platform Merchant experiences
any Chargebacks, Platform Merchant must communicate and cooperate with Partner
Platform to resolve the Chargeback in accordance with the Rules, this Agreement,
and the Partner Platform Agreement. Processor is not responsible to Platform
Merchants for Partner Platform’s handling of Chargebacks or any services
provided by Partner Platform that are outside the scope of this Agreement. Furthermore, Processor is not responsible for and disclaims
all liability for Partner Platform’s and its Affiliates’, employees’ and
agents’ (a) acts or omissions in providing any of Partner Platform’s services
to Platform Merchants; (b) compliance with Applicable Law and obligations
related to the services provided by Partner Platform; and (c) providing
customer service, notifications, receipts, handling refunds or consumer
complaints, or taking other actions related to the services provided by Partner
Platform.
7.
TERM AND TERMINATION.
7.1. Term. The term of this Agreement commences on the Effective
Date and continues until this Agreement is terminated by Merchant or Processor pursuant
to the terms herein (the “Term”).
7.2. Termination by Merchant. Merchant may terminate this Agreement at any time by providing notice to Processor.
7.3. Termination or Suspension of Services by Processor.
7.3.1. Processor may terminate this Agreement or a
Services Schedule
with thirty (30) days’ prior notice at any time and for any reason; provided
that, this Agreement will automatically terminate if Merchant is not approved
by Processor (after submitting an Application) to use or access the Services.
7.3.2. Processor may terminate this Agreement or suspend or
terminate Merchant’s access to all or part of the Services or Finix Technology
immediately if (i) Merchant experiences, or Processor
reasonably suspects Merchant could experience, Suspicious Activity; (ii)
Processor reasonably determines that Merchant’s Transactions or the
circumstances surrounding its Transactions have otherwise become irregular or
increase Finix’s or Bank’s exposure to Chargebacks, reputational, or other
security risks; (iii) there has been a material or potentially material
deterioration of Merchant’s financial condition; (iv) Merchant becomes subject
to any voluntary or involuntary bankruptcy, insolvency, reorganization, or
liquidation proceeding, a receiver is appointed for Merchant, or Merchant makes
an assignment for the benefit of creditors, or admits inability to pay its
debts as they become due; (v) Merchant ceases doing business as a going
concern, or there is a Change of Control; (vi) Merchant is in breach of this
Agreement (including but not limited to the Documentation), the Rules, or
Applicable Law; (vii) Merchant’s name or its principals’ names are listed
on a Network terminated merchant or risk monitoring program; (viii) directed to
do so by Bank, any Regulatory Authority, or a Network; (ix) Merchant or
Merchant’s principals become subject to any criminal or civil action, suit, or
proceeding or to any government or regulatory investigation or enforcement action;
or (x) Merchant fails to process any
Transactions for at least two (2) consecutive calendar months and is not a
seasonal merchant. If Merchant was boarded through a Partner Platform, this
Agreement terminates automatically when Merchant’s Partner Platform Agreement
terminates. This Agreement will automatically terminate if Finix’s sponsorship
agreement with Bank terminates. Any
suspension or limitation pursuant to this Section will be in addition and
without prejudice to any remedy available to Processor at law or in equity if
Merchant breaches this Agreement.
7.4.
Effect
of Termination.
7.4.1.
Termination
of a Services Schedule or any individual Services will not automatically effect a
termination of the entire Agreement, any other Services Schedule, or any
Services outside the scope of the terminated Services Schedule. Any notice of
termination of this Agreement must clearly identify the terminating Party’s intent
to terminate the entire Agreement.
7.4.2.
Upon
termination of this Agreement, Merchant will return any of Processor’s
property, equipment, or forms. Merchant’s obligations under this Agreement with
respect to Transactions, Chargebacks, the Settlement Account, and Reserve
Accounts will survive termination of this Agreement. Following termination of
this Agreement, Processor reserves the right to require Merchant to establish
and fund new Reserve Account(s) or deposit additional funds into existing
Reserve Accounts. Processor’s rights and authorizations under this Agreement to
debit and credit Merchant’s Settlement Account and Reserve Account(s) will also
survive termination of this Agreement.
7.4.3.
Merchant
acknowledges that the Networks may maintain registries containing the names of
any business (and its principals) which have been terminated for certain
reasons. Merchant acknowledges that Processor may be required to report
Merchant (and its principals) to the Networks if this Agreement is terminated.
Merchant agrees and consents to such reporting if this Agreement is terminated as
may be required by the Rules. Merchant also acknowledges that Processor may
submit a derogatory report on Merchant and its principals to a consumer and/or
business credit reporting agency. Processor will not be liable to Merchant or
its principals for any damages (including prospective sales or profits) due to
termination of this Agreement or reporting to the Networks or a credit
reporting agency by Processor.
7.4.4. It is the express agreement of Processor
and Merchant that the acquisition of Transactions hereunder is a financial
accommodation and, if Merchant becomes a debtor in any bankruptcy or similar
proceeding, then (i) such event will be deemed a default for purposes of this
Agreement and Section 365(B)(1) of the United States Bankruptcy Code or any
applicable successor statutory provision thereto; and (ii) it is the intent of
the Parties that, unless otherwise agreed by Processor, this Agreement should
not be assumed or enforced by any other person and Processor should be excused
from performance hereunder.
8.
AUDIT AND RISK
MANAGEMENT.
8.1. Processor may monitor Merchant’s business
and Transactions for risk management purposes. Merchant must immediately remedy
any and all issues identified by Processor if Processor determines, in its sole
discretion, that Merchant is operating in a manner that violates Applicable
Law, the Rules, or this Agreement, or which poses a material risk of harm to
Processor. If Processor identifies any Suspicious Activity, Processor is
authorized to take protective actions including (i) closing terminals; (ii)
blocking Transactions; (iii) holding funds (including, without limitation,
charging any applicable Fees or increasing Reserve Account requirements); and
(iv) investigating such Suspicious Activity. Processor may impose caps or
limitations on Merchant’s use of the Services, including Transaction
processing, in Processor’s sole discretion. Processor may change any such caps
or limits from time to time, without prior notice to Merchant. If Merchant
exceeds an established cap or limit, Processor may suspend the processing of
Transactions beyond such cap or limit. The foregoing provision does not limit
any other rights or remedies of Processor set forth in this Agreement.
8.2. Merchant agrees to cooperate in any audit,
examination, or investigation as may be required by Processor, the Networks, or
a Regulatory Authority; and upon request and reasonable prior notice, permit
Processor, the Networks, or a Regulatory Authority to conduct an on-site
inspection of Merchant’s premises and examine Merchant’s books, records,
practices, and systems, but only to the extent that each pertains to compliance
with this Agreement. Any audit that is required by Applicable Law or the Rules
will be at Merchant’s sole expense. Except as stated otherwise herein, all
other audits will be at Processor’s expense. Processor and any other applicable
entities will have the right to retain a third party to perform any audit.
Merchant agrees to implement any changes identified pursuant to an audit
necessary to remediate or prevent any violation of Applicable Law or the Rules.
If Processor, in its discretion, determines that there is a need for an audit
regarding a potential violation of Applicable Law or the Rules, Processor may
withhold payment of amounts owed to Merchant without penalty pending completion
of the audit. If it is determined that there has been a violation of Applicable
Law or the Rules relating to this Agreement, Processor may withhold payment of
amounts owed to Merchant for a reasonable amount of time in an amount equal to
the costs, fees, and expenses incurred by Processor in investigating and
resolving the same and for any damages incurred by Processor.
9.
CONFIDENTIALITY. Receiving
Party will not use or access any Confidential Information of Disclosing Party
for any purpose outside the scope of this Agreement, or disclose Confidential
Information to any third party except with Disclosing Party's prior written
consent. Receiving Party will protect the confidentiality of Disclosing Party's
Confidential Information utilizing the same standard of care that it employs to
protect the confidentiality of its own information of a similar nature (but in
no event using less than reasonable care).
Receiving Party will promptly notify Disclosing Party if it becomes
aware of any actual or reasonably suspected breach of the confidentiality of
Disclosing Party's Confidential Information. If Receiving Party is compelled by
law to disclose Confidential Information of Disclosing Party, it will provide
Disclosing Party with prior notice of such compelled disclosure (to the extent
legally permitted) and reasonable assistance, at Disclosing Party's cost, if
Disclosing Party exercises efforts to contest the disclosure or secure a
protective order or other confidential treatment therefor. The Parties
acknowledge that any breach or threatened breach of this Agreement involving an
unauthorized use or disclosure of Confidential Information may result in
irreparable harm for which damages would not be an adequate remedy, and
therefore, in addition to its rights and remedies otherwise available at law,
the aggrieved Party will be entitled to seek injunctive or other equitable
relief, as appropriate. If a Party seeks any equitable remedies, such Party
will not be precluded or prevented from seeking remedies at law, nor will such
Party be deemed to have made an election of remedies.
10. REPRESENTATIONS
AND WARRANTIES.
10.1. Mutual Representations and Warranties. Each Party represents and warrants that:
(i) it is duly organized, validly existing and in good standing as a legal
entity under the laws of its applicable jurisdiction; (ii) the execution of
this Agreement by its representative has been duly authorized and is effective
to bind the Party; and (iii) the execution and delivery of, and the Party’s
performance under, this Agreement does not and will not breach any agreement or
other legal duty that said Party owes to any third party.
10.2. Additional Merchant Representation and
Warranties. Merchant represents and warrants to
Processor at the time of execution and with each Transaction processed
hereunder:
10.2.1.
All
information contained in the Application or any other documents delivered to
Processor in connection with this Agreement is true and complete;
10.2.2.
Merchant
will not submit any Transactions that are not in compliance with this
Agreement, Applicable Law, and the Rules;
10.2.3.
Merchant
has all licenses, if any, required to conduct its business and is qualified to
do business in every jurisdiction where it is required to do so;
10.2.4.
There
is no action, suit, or proceeding now pending or, to Merchant’s knowledge,
threatened by or against or affecting Merchant which would substantially impair
its right to carry on its business as now conducted or adversely affect its
financial condition or operations;
10.2.5.
Merchant’s
use of the Services does not violate or infringe upon any third-party rights;
and
10.2.6.
Merchant’s
business and use of the Services complies with the Documentation, Applicable
Law, and the Rules.
11. INDEMNIFICATION.
11.1.
By
Finix. Finix will defend, indemnify, and hold
harmless Merchant from and against any third party claims, damages, losses,
liabilities, costs, and expenses (including reasonable attorneys’ fees) arising
from any IP Claims; provided that Finix will have no obligation to defend,
indemnify, or hold harmless Merchant from and against any IP Claim (i)
resulting from use of the Services or Finix Technology other than as authorized
by this Agreement; (ii) resulting from a modification to the Finix Technology
that was not made by Finix; (iii) to the extent the IP Claim arises from or is
based on Merchant’s use of the Services or Finix Technology with other
products, services, or data not supplied by Finix or its Affiliates; (iv) based
on Merchant’s use of an old or outdated version of the Services or Finix
Technology following an Update, if the infringement would have been avoided had
Merchant implemented said Update; (v) if Merchant is in material breach of this
Agreement; or (vi) based on any Finix modifications made pursuant to
instructions, designs, specifications or any other information provided by or
on behalf of Merchant, if any. Finix’s obligations to indemnify Merchant for IP
Claims is conditioned on Merchant giving prompt written notice of the IP Claim
to Finix; permitting Finix to retain sole control of the investigation, defense
or settlement of the IP Claim; and using all reasonable efforts to mitigate any
actual or anticipated claims and providing Finix with cooperation and
assistance as Finix may reasonably request in connection with the IP Claim. If, as a result of an IP Claim or an
injunction, Merchant must stop using any portion of the Finix Technology, Finix
may at its expense and option either obtain for Merchant the right to continue
using the Finix Technology; replace the applicable Finix Technology with a
functionally equivalent, non-infringing Finix Technology; or modify or remove
the applicable portion of the Finix Technology through an Update so that it is
non-infringing.
11.2. By Merchant. Merchant agrees to indemnify Processor
and its affiliates, officers, directors, employees, and agents against and to
hold them harmless from any and all claims and demands of any party arising
from or based upon any breach of this Agreement or act or omission of Merchant
or its employees, representatives, agents, or service providers in connection
with or arising out of (i) this Agreement; (ii) Merchant’s obligations,
responsibilities, or duties pursuant to this Agreement; (iii) any Transactions
which Merchant submits to Processor; (iv) Merchant’s violation of the Rules or
any Applicable Law; or (v) any hacking, infiltration, or compromise of Merchant’s
systems or the systems of Merchant’s representatives, agents, or service
providers. If Processor is made a party to any litigation, proceeding,
arbitration, bankruptcy proceeding, or other legal process commenced by any
third party, Merchant will protect and hold Processor harmless from and with
respect to such litigation, proceeding, arbitration, bankruptcy proceeding, or
other legal process and will pay all costs, expenses, and attorneys’ fees
incurred or paid in connection therewith, together with any judgments rendered.
12. LIMITATIONS.
12.1.
Limitation
of Liability. Finix will
not accept responsibility or liability for errors, acts, or failures to act by
others, including, but not limited to, agents, third-party suppliers of
software, equipment, or services; or banks, communication common carriers, data
processors, or clearinghouses through which Transactions may be passed,
originated, and/or authorized. In any event, Finix’s cumulative liability to
Merchant under this Agreement, any of the Services Schedules, and any other
term incorporated by reference into this Agreement, whether arising in
contract, tort (including, without limitation, negligence and strict
liability), or otherwise, will not exceed the lesser of $10,000 or an amount
equal to the aggregate of monthly net Fees paid by Merchant in the one (1)
month period prior to the month that the incident giving rise to liability
occurred. In no case will Merchant be entitled to recover damages from
Bank.
12.2.
Limitation
of Damages. IN NO EVENT WILL
PROCESSOR BE LIABLE TO MERCHANT OR MERCHANT’S AFFILIATES FOR SPECIAL,
INCIDENTAL, INDIRECT, CONSEQUENTIAL, OR EXEMPLARY DAMAGES OR FOR ANY
INTERRUPTION OR LOSS OF USE, DATA, BUSINESS, OR PROFITS, WHETHER OR NOT SUCH
LOSS OR DAMAGES WERE FORESEEABLE OR PROCESSOR WAS ADVISED OF THE POSSIBILITY
THEREOF AND REGARDLESS OF WHETHER ANY LIMITED REMEDY HEREIN FAILS OF ITS
ESSENTIAL PURPOSE.
12.3.
Disclaimer. PROCESSOR PROVIDES THE SERVICES AND
FINIX TECHNOLOGY “AS IS” AND “AS AVAILABLE”. EXCEPT AS EXPRESSLY STATED AS A
“WARRANTY” IN THIS AGREEMENT, AND TO THE MAXIMUM EXTENT PERMITTED BY LAW,
PROCESSOR DOES NOT MAKE ANY, AND PROCESSOR SPECIFICALLY DISCLAIMS, ALL
WARRANTIES OF ANY KIND, EXPRESSED OR IMPLIED, INCLUDING, WITHOUT LIMITATION,
ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE WITH
RESPECT TO THE SERVICES PROVIDED HEREUNDER. WITHOUT LIMITING THE GENERALITY OF
THE FOREGOING, PROCESSOR DOES NOT GUARANTEE OR WARRANT THAT THE SERVICES OR
FINIX TECHNOLOGY WILL BE UNINTERRUPTED OR ERROR-FREE.
13. TAXES.
Merchant agrees to pay
all taxes and other charges imposed by any Regulatory Authority on the services
provided under this Agreement. Section
6050W of the Internal Revenue Code requires certain payment providers and
third-party payment networks to report payment settlement amounts to the IRS for each Merchant processing
through Processor. Merchant will verify its identity by providing Processor
with a tax identification number, such as a Social Security Number or Employer
Identification Number. If Merchant fails to provide this information, Processor
will place a restriction on the provision of Services to Merchant and may
restrict the receipt of funds into Merchant’s Settlement Account, or withhold a
percentage of Settlement Funds in order to satisfy the backup withholding
requirements of the IRS. Finix may charge Merchant additional fees for
associated administrative costs. To
the extent required under the Internal Revenue Code, Finix will provide
Merchant Form 1099 reporting for the Transactions processed through this
Agreement. If required under the Internal Revenue Code, Finix may perform
backup withholding by deducting and withholding income tax from reportable
Transactions if (i) Merchant fails to provide its tax identification number; or
(ii) if the IRS notifies Processor that the tax identification number (when
matched with the name) provided by Merchant is incorrect. Accordingly, to avoid
backup withholding, Merchant must provide Processor with the correct name and tax
identification number that it uses when filing its tax return that reflects the
Transactions under this Agreement. Processor will not be liable for any damages
arising out of or relating to this Section 13 which resulted from
Merchant providing incorrect information.
14. GENERAL
PROVISIONS.
14.1.
Electronic
Communications. Merchant
consents to (a) receive communications electronically; and (b) the use of
electronic signatures. Merchant agrees that communications between Merchant and
Processor that are received, sent, or signed electronically will have the same
legal effect as a signed physical document. Merchant agrees that the Services
are subject to the federal Electronic Signatures in Global and National
Commerce Act, and that this law will apply to validate Merchant’s ability to
engage electronically in transactions related to the Services.
14.2.
Updates
and Modifications to Services. From time to time, Finix may release Updates through the Finix
Dashboard or any other means that Finix may choose. Such Updates will become part
of the Services or Finix Technology, as applicable, and subject to this
Agreement. Finix will have no obligation under this Agreement or otherwise to
provide any such Updates. If an Update will cause a material adverse change to,
depreciation of, or removal of functionality from the Services or Finix
Technology used by Merchant, Finix will use commercially reasonable efforts to give
Merchant prior notice of the Update. Merchant agrees to fully install all
Updates released within thirty (30) days of Finix making an Update available to
Merchant. Merchant understands that Finix may, in its sole discretion, cease
supporting old versions or releases of the Services or Finix Technology at any
time after an Update.
14.3.
Subcontracting. Processor may subcontract its
obligations under this Agreement to third party service providers without
notice to Merchant.
14.4.
Privacy
Policy; Use of Processing Data. Finix’s Privacy Policy, which is available through the Finix
Website or the Finix Dashboard, and Bank’s Privacy Policy, found at
www.finix.com/legal/acquirers, explains how and for what purposes Processor collects,
uses, retains, discloses and safeguards Processing Data that you provide to Processor.
Merchant acknowledges that Processor and its Affiliates will receive and handle
Processing Data in connection with Processor’s performance under this
Agreement. Merchant further acknowledges, agrees, and consents to the right of Processor
and its Affiliates to receive, access, process, transmit, store, and create
derivative works of the Processing Data: (i) as reasonably required for Processor
to perform its respective obligations hereunder; (ii) to monitor and report
fraud or other unlawful or suspicious activities by Customers or any third
party; (iii) to develop and improve Processor’s products and services; (iv) as
required to comply with court order, government investigation, industry
self-regulatory guidelines, contractual requirements with financial partners, or
other legal requirements and operations of Applicable Law or the Rules; and (v)
in furtherance of its other business operations and commercial purposes.
Merchant permits Processor and its Affiliates to share Processing Data with the
Networks, between Bank and Finix, and their respective Affiliates, and with Partner Platform, as applicable,
and Merchant consents to the rights of each of the foregoing to use the same without
restriction for marketing, analysis, transactions or relationship
communication, and any other lawful business purpose. Separate from and in
addition to any other representation or warranty herein contained, Merchant
represents and warrants that: (a) it possesses all necessary rights,
authorizations, licenses, and consents to provide Processing Data to Processor
and its Affiliates (and for Processor or its Affiliates to subsequently use and
access such Processing Data) as set forth herein, including without limitation
such authorizations and consents required by Applicable Law and the Rules
governing data privacy, information security, and consumer protection; and (b)
the Processing Data does not infringe, misappropriate, or otherwise violate the
personal or proprietary rights of any third party.
14.5.
Notices.
14.5.1.
Notices
to Finix. Except with
respect to Platform Merchants, Merchant will provide Finix with all notices,
requests, or other communications required by it hereunder in electronic form by
delivering them via electronic mail to legal@finixpayments.com or through the Finix Dashboard. Finix
reserves the right to, from time to time, update or change the electronic mail
address it uses to receive Merchant’s notices, requests, or other
communications by notifying Merchant of the changed address. Notices sent by
Merchant will be deemed to have been properly given in “writing” when sent
through electronic mail to the correct Finix address or Partner Platform, as
applicable, with proof of delivery.
14.5.2.
Notices
to Merchant. Except with
respect to Platform Merchants, Finix may provide Merchant with all notices,
requests, or other communications required by Processor hereunder by: (i) delivering
them through electronic mail to the electronic mail address listed in
Merchant’s Application; (ii) posting to the Finix Website; (iii) posting or
delivering them on or through the Finix Dashboard; or (iv) delivering them to
the Merchant’s physical address, as listed in Merchant’s Application, by
certified mail or a nationally recognized overnight delivery service. Finix
reserves the right but assumes no obligation to provide certain notices
hereunder in paper format. To the fullest extent permitted by Applicable Law, all
notices or other communications regarding the Services may be provided to
Merchant electronically, and Merchant agrees to receive all communications from
Processor in electronic form. All communications delivered by Finix to Merchant
or Partner Platform, as applicable, in either electronic or paper format will
be considered to be in “writing,” and to have been received no later than five
(5) Business Days after posting or dissemination, whether or not Merchant has
received or retrieved the communication.
14.6.
Modifications
to Agreement. Processor
may modify or amend any provision of this Agreement for any reason and at any
time. Except as expressly stated otherwise in this Agreement, such
modifications and amendments will become effective as of the date the amended
Agreement is posted to the Finix Website or the Finix Dashboard. Merchant is
responsible for regularly checking the Finix Website or the Finix Dashboard for
updates to this Agreement. If Processor modifies or amends this Agreement in a
way that reduces Merchant’s rights or increases Merchant’s responsibilities
under this Agreement, Processor will give electronic written notice to Merchant
of the changes. In such cases, the modifications or amendments will become
effective as of the date stated in the notice. By continuing to use the
Services after the effective date of any modifications or amendments to this
Agreement, Merchant agrees to be bound by the amended Agreement; provided that
if Merchant does not wish to agree to such modifications or amendments, Merchant
may immediately terminate its use of the Services and this Agreement without
agreeing to the changes by providing Processor with notice of such prior to the
effective date of the applicable modifications or amendments. Merchant may not modify or amend any provision
of this Agreement.
14.7.
Dispute
Resolution, Jury Waiver, and Class Action Waiver.
14.7.1. Scope. Any and all claims, based on whatever the cause, law,
rule, or regulation, whether statutory or common law, and however
characterized, whether existing now, in the past or in the future, as to which
the Parties or any of their subsidiaries, successors, or Affiliates may be
adversarial Parties, and whether arising out of this Agreement or from any
other cause or action, will be exclusively resolved by binding arbitration
administered by the American Arbitration Association (“AAA”) pursuant to its Commercial Arbitration Rules (the “AAA Rules”). For purposes of this
Section, the term Parties and Merchant will in both cases include Merchant’s
principals.
14.7.2.
Choice
of Law and Place of Arbitration. This Agreement will be governed and construed in accordance with
and pursuant to the law of the State of California, without giving effect to
its principles of conflict of laws. The place of arbitration will be in San
Francisco, California, and each of the Parties waives any objection it may now
or hereafter have to venue or to convenience of forum, agrees that all claims
in respect of any such legal proceeding will be heard and determined only
pursuant to the AAA Rules, and agrees not to bring any legal proceeding arising
out of or relating to this Agreement in any court or before any other arbitral
body. Jurisdictional and arbitrability disputes, including disputes over the
formation, existence, validity, interpretation, or scope of this Agreement, or
regarding the identity of the proper Parties, will be submitted to and ruled on
by the arbitrator. The arbitrator has the authority to determine jurisdiction
and arbitrability issues as a preliminary matter. The arbitrator will be bound
by the provisions of this Agreement and base the award on applicable law and
judicial precedent. Upon rendering a decision, the arbitrator will state in
writing the basis for the decision, including the findings of fact and
conclusions of law upon which the decision is based.
14.7.3.
Jury
Trial Waiver; Class Action Waiver. To the extent permitted by law, the Parties hereby knowingly,
voluntarily, and intentionally waive any rights either of them may have to a
trial by jury in respect of any litigation based on, arising out of, or in
connection with this Agreement. To the extent permitted by law, Merchant
covenants that any dispute arising out of or in connection with this Agreement
will be conducted only on an individual basis and not in a class, consolidated,
or representative action, and that Merchant will not be a party to any class
action against Processor. The Parties agree that any such action, if filed, will
be dismissed upon application and will be referred for arbitration hereunder
with costs and attorneys’ fees to the prevailing Party. ANY ARBITRATION UNDER
THIS AGREEMENT WILL ONLY BE ON AN INDIVIDUAL BASIS, AND NEITHER PARTY MAY
PARTICIPATE IN ANY CLASS-WIDE ARBITRATION WITH RESPECT TO THE SUBJECT MATTER OF
THIS AGREEMENT, OR OTHERWISE ATTEMPT TO CONSOLIDATE ARBITRATION CONDUCTED
PURSUANT TO THIS PARAGRAPH WITH ANY OTHER ARBITRATIONS OR SIMILAR PROCEEDINGS.
EACH PARTY, AFTER CONSULTING (OR HAVING THE OPPORTUNITY TO CONSULT) WITH
COUNSEL OF ITS CHOICE, KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY
RIGHT TO TRIAL BY JURY IN ANY ACTION OR OTHER LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT IN FAVOR OF THE ARBITRATION PROCEDURES SET FORTH
HEREIN. Notwithstanding the foregoing, either Party may bring a claim for
preliminary or temporary injunctive relief before any court of competent
jurisdiction in order to prevent, remedy, or mitigate irreparable harm caused
to such Party by the present or ongoing breach of Agreement by the other Party.
14.7.4.
Finality
and Fees. The Parties will
share the costs, fees, and expenses of arbitrator and/or arbitration company
equally, except that the Party initiating such arbitration will be responsible
for all filing fees in connection therewith. The arbitrator’s award, including
awards of attorneys’ fees, costs, and expenses, will bind the Parties, and may
be entered as a judgment in any court of competent jurisdiction. The Parties
hereby agree that any federal or state court located in San Francisco,
California is a court of competent jurisdiction for this purpose. In addition
to finality of the award or decision, the award or decision will be eliminated
from any process, petition to, or motion of appeal except as permitted by
applicable law. Each Party hereby waives, and agrees not to assert, by way of
motion, as a defense, or otherwise, in any such suit, action, or proceeding,
any claim that it is not subject personally to the jurisdiction identified
herein, that its property is exempt or immune from attachment or execution,
that the suit, action, or proceeding is brought in an inconvenient forum, that
the venue of the suit, action, or proceeding is improper or that this Agreement
or the subject matter hereof may not be enforced. Each Party hereto submits to
the exclusive jurisdiction of the state and federal courts located in San
Francisco, California, for any action to compel or stay arbitration, for any
dispute regarding the arbitrability of a claim relating to or arising under
this Agreement or to obtain injunctive relief to enforce this Agreement
(jurisdictional, venue, and inconvenient forum objections to which are hereby
waived by all parties hereto).
14.7.5.
Covenant
Not to Sue. The Parties covenant that under no conditions
will any Party or any Affiliate file any action against the other (except only
requests for injunctive or other equitable relief) in any forum other than
before the arbitrator.
14.8.
Entire
Agreement: Assignability.
This Agreement expresses the entire understanding of the Parties with respect
to its subject matter. This Agreement will be binding upon Merchant and
Processor and their respective heirs, successors, and assigns. Except as
expressly permitted under the terms of this Agreement, Merchant may not assign
this Agreement or any of its rights, obligations, or responsibilities under
this Agreement without Processor’s express prior written consent, and any
purported assignment without such consent will be void. If Merchant
nevertheless assigns this Agreement without such consent of Processor, both
Merchant and the assignee will remain liable, and Merchant will be held
personally liable if such assignee incurs Chargebacks, Retrieval Requests, ACH
rejects, losses, fines or any other liabilities under this Agreement. This
Agreement may be assigned by Processor at any time.
14.9.
Force
Majeure. Processor will
be excused from performing any of its obligations under this Agreement that are
prevented or delayed by any occurrence not within Processor’s control
including, but not limited to, strikes or other labor matters, destruction of
or damage to any building, natural disasters, accidents, war, riots, emergency
conditions, interruption of transmission or communications facilities,
equipment failure, or any regulation, rule, law, ordinance or order of any Regulatory
Authority.
14.10.
Waiver;
Severability. Failure by
Processor to enforce one or more of the provisions of this Agreement will not
constitute a waiver of the right to enforce the same or other provision in the
future. The waiving Party must sign all waivers. If any provision of this Agreement
is illegal or unenforceable, the invalidity of that provision will not affect
any of the remaining provisions and this Agreement will be construed as if the
illegal provision is not contained in this Agreement. Merchant is responsible
for its employees’ actions while in its employ. The Parties do not intend to
confer any benefits on any person or entity other than Merchant and Processor.
15. DEFINITIONS.
“AAA”
and “AAA Rules” has the meaning set forth in Section 14.7.1 of
the General Terms.
“ACH” means an electronic funds transfer
processed through the ACH Network and subject to the N
“ACH Network” means the Automated
Clearing House Network, which is a batch processing, store-and-forward system
that accumulates and distributes ACH Transactions that are received from an
ODFI and are forwarded to a specified RDFI according to the Nacha Rules.
“ACH
Processing Services” means certain services whereby
Processor provides Merchants with the ability to originate credit and debit
Entries in accordance with the N
“ACH
Transaction” means a Transaction consisting of an Entry to the ACH
Network.
“Affiliate” means, with respect to a
Party, any other person that controls, is under common control with, or is
controlled by, such Party. For purposes of this Agreement, “control” means
possessing, directly or indirectly, the power to direct or cause the direction
of the management, policies or operations of an entity, whether through
ownership of voting securities, by contract or otherwise.
“Applicable Law” means any and all applicable federal, state,
and local laws, statutes, regulations, rules, codes, ordinances, court orders,
and regulatory guidance that govern or affect this Agreement or the subject matter
hereof, including, but not limited to, the Electronic Fund Transfer Act (15
U.S.C. 1693, et seq.), Regulation E (12 C.F.R. 1005, et seq.), the U.S.
economic sanctions laws and regulations administered by the Office of Foreign
Assets Control (“OFAC”), consumer
protection laws, data security, and privacy protection laws.
“Application” means
Merchant’s submission of a request for Services through the Finix Website,
Finix Dashboard, Finix-provided URL link, or through a Partner Platform, and
includes all information submitted by Merchant in connection with such request.
“Authorization” means approval by, or on
behalf of, the Issuing Bank or Network to validate a Transaction for a
Merchant. With respect to Card Transactions, an Authorization indicates only
the availability of the Cardholder’s credit limit at the time the Authorization
is requested and is not a guarantee that a Transaction is valid.
“Bank” means one or more banks listed at
www.finix.com/legal/acquirers. For purposes of this Agreement and to the extent
multiple banks are listed, the applicable Bank(s) is/are the one(s) identified
in the Application confirmation or other notice provided to Merchant.
“Beneficial
Owner” means a person who, directly or indirectly, either (i) exercises
substantial control over Merchant or (ii) owns or controls at least 25% of
Merchant’s voting securities or interests.
“Business Day” means any day on which Bank is open for business,
other than Saturdays, Sundays, or banking holidays.
“Card” means any valid account or
evidence of an account issued to a Cardholder under license from a Card Brand
or any representative or member of a Card Brand that Merchant accepts as
payment from Cardholders for goods, charitable donations or services. Cards
include, but are not limited to, credit cards, debit cards, or prepaid debit
cards in the form issued under a license from a Card brand.
“Cardholder” means the person to whom the
Card was issued, whose name may be embossed on the Card, and any authorized
user of such Card.
“Card Brand” means (i) MasterCard
International Inc. (“MasterCard”),
Visa U.S.A., Inc. (“Visa”), DFS
Services LLC d/b/a Discover Global Network (“Discover”) (including Diners Club International and any card issuer
of payment cards processed and settled through the Discover network), American
Express Travel Related Services Company, Inc. (“American Express”) each including applicable subsidiaries; and (ii)
Debit Networks supported by Processor.
“Card Transaction” means a Transaction
initiated using a Card from a Card Brand.
“Change of Control” means (i) an event in which any third
party or group acting together, directly or indirectly, acquires or becomes the
Beneficial Owner of, more than 50% of Merchant’s voting securities or
interests; (ii) Merchant’s merger with one or more third parties; (iii)
Merchant’s sale, lease, transfer or other disposal of all or substantially all
of its assets; or (iv) entering into of any transaction or arrangement that
would have the same or similar effect as a transaction referred to in the
foregoing; but, does not include an initial public offering or listing.
“Card Processing Services” means
services whereby Processor provides Merchant with the ability to acquire,
authorize, process, and settle Card transactions undertaken by Cardholders at
Merchant’s location (including ecommerce) in the United States.
“Chargeback” means a reversal of a Transaction
previously presented to Processor by Merchant pursuant to the Rules (which term
may include “disputes” as defined by the Rules).
“Confidential Information” means all sensitive, nonpublic, and/or proprietary
information of a Party (“Disclosing Party”) disclosed to the other Party
(“Receiving Party”), whether orally or in writing, that is designated as
confidential or that reasonably should be understood to be confidential given
the nature of the information and the circumstances of disclosure, including
the terms and conditions of this Agreement (including pricing and other terms
reflected in the Services Schedules), business and marketing plans, technology
and technical information, product designs, and business processes. Without
limiting the foregoing, all Documentation, and all Finix Technology are the
Confidential Information of Finix and the existence and terms of this Agreement
are the Confidential Information of each Party; provided, however, that each
Party may confidentially disclose the terms and conditions of this Agreement to
any actual or potential bona fide investors, acquirers or lenders who have
agreed to be bound by confidentiality obligations with respect thereto at least
as stringent as those set forth hereunder. Confidential Information will not
include any information that: (i) is or becomes generally known to the public
without breach of any obligation owed to Disclosing Party; (ii) was rightfully
known to Receiving Party prior to its disclosure by Disclosing Party without
breach of any obligation owed to Disclosing Party; (iii) was independently
developed by Receiving Party without use of or reference to any Confidential
Information; or (iv) is rightfully received from a third party without breach
of any obligation owed to Disclosing Party. For avoidance of doubt,
Confidential Information does not include Processing Data.
“Customer”
means a person who initiates a Transaction to purchase goods, services,
reservations, or other items from Merchant.
“Customer
Data” means (i) with respect to Card Transactions, information related to a
Cardholder’s Card, which is obtained by Merchant from the Cardholder’s Card, or
directly from the Cardholder in connection with his or her use of a Card (e.g.,
a security code, a PIN number, credit limits, account balances, or the
Cardholder’s zip code when provided as part of an address verification system).
Without limiting the foregoing, such information may include the Card account
number and expiration date, the Cardholder’s name or date of birth, PIN data,
security code data (such as CVV2 and CVC2), and any data read, scanned,
imprinted, or otherwise obtained from the Card, whether printed thereon, or
magnetically, electronically, or otherwise stored thereon; (ii) with respect to
ACH Transactions, Protected Information, as defined by Nacha, including a
Customer’s bank account numbers, and bank routing numbers; and (iii) with
respect to Disbursements the Merchant Payee’s account numbers and routing
numbers.
“CVV2” means card verification value.
“Debit Networks” means those debit card networks accepted by Processor.
“Disbursement Services” has the meaning
set forth in the Disbursement Services Schedule of this Agreement.
“Disbursement” means an ACH Transaction
or an intrabank transfer in which Merchant instructs Processor to send funds to
a Merchant Payee from Settlement Funds.
“Disbursement Services” means the services provided by Processor that enable
Merchants to make Disbursements to designated Merchant Payees from Settlement
Funds.
“Documentation” means the user manuals, training materials, product
descriptions and specifications and other printed information relating to the
Finix Technology provided by Finix (either directly or through the Finix
Website or Finix Dashboard), as updated from time to time.
“Effective Entry Date” means the date
the Originator intends for an Entry to be settled with the RDFI.
“Entry” or “Entries” has the meaning set forth in the Nacha Rules and will also
mean the data received from Merchant hereunder from which Processor originates
each Entry.
“Fee(s)” means any and all of the fees,
charges, or costs charged to Merchant as specified in the Application, the
Finix Website, the Finix Dashboard, or elsewhere in this Agreement for any of
the services provided by Processor under this Agreement, including, but not
limited to, the fees, liabilities, charges, costs, or amounts owed for the
Services.
“Fee
Dispute Notice” means a written
notice sent by Merchant to Finix regarding the disputed amount of an invoice,
which notice will include documentation supporting the alleged billing error.
“Feedback”
means ideas, suggestions, comments, observations or other input that Merchant
provides to Finix regarding the Services or Finix Technology.
“Finix
Dashboard” has the meaning set forth in Section 3.1 of the General
Terms.
“Finix
Technology” means the Finix Dashboard, Finix’s payment processing platform
for online e-commerce transactions, and all Finix technology used by Merchant
for managing Card Transactions, ACH Transactions, and Disbursements together
with all programs, tools, applications, application programming interfaces (“APIs”),
all Documentation, and all other software components provided by Finix
hereunder in connection with the Services.
“Finix
Website” means https://finix.com/,
and all sub-domains therein.
“IP Claim”
means a claim, suit, action, or proceeding brought against Merchant by a third party
that is based on an allegation that the Finix Technology, or Merchant’s use
thereof, infringes or misappropriates a third party’s United States (or Berne
Convention signatory country) intellectual property rights.
“Issuing Bank” means the bank which has
issued a Card to a Cardholder.
“Merchant Account Number” or “Merchant Identification Number” or “MID” means the number assigned and
issued by Finix to Merchant, if and only if Merchant is approved and this
Agreement is accepted by Processor, that numerically identifies Merchant to
Processor for accounting, billing, customer service, and other related purposes
in connection with the Services. Issuance of the approved Merchant Account
Number to Merchant will evidence the acceptance and approval of Merchant for
the Services under this Agreement.
“Merchant Payee” means a person or
entity to which Merchant owes payment and requests that Processor make a
payment to through the Disbursement Services.
“Nacha” (formerly known as the National
Automated Clearing House Association) means the organization that governs the
ACH Network.
“Nacha
Rules” means Nacha’s Operating Rules and Guidelines, as amended from time
to time.
“Network”
means the Card Brands and ACH Network, and Nacha, collectively.
“ODFI”
means Originating Depository Financial Institution, as defined in the Nacha
Rules.
“Originator”
means a person or entity that has
authorized an ODFI to transmit, for the account of that person or entity, an
Entry to the Receiver’s account at the RDFI.
“Partner Platform” means an online
or software platform, marketplace or service provider that provides services to
Platform Merchants and provides Platform Merchants with access to the Services
pursuant to this Agreement.
“Partner Platform Agreement” means
the agreement between the Partner Platform and the Platform Merchant governing
the Partner Platform’s provisions of services to the Platform Merchant,
including those services for accessing the Services under this Agreement.
“Pass-Through Costs” has the
meaning set forth in Section 2.6 of the General Terms.
“PIN” means a personal identification number.
“PIN Debit Card” means a card validly issued by a Debit Network requiring the entry of a PIN.
“Platform Fees” means any and all
of the fees, charges, or costs charged to a Platform Merchant by a Partner
Platform, as specified in a Partner Platform Agreement.
“Platform Merchant” means a
Merchant that accesses the Services through a Partner Platform.
“Prohibited
Business” means the business types listed as prohibited industries in the Documentation, as may be
updated and communicated to Merchant from time to time.
“Processing Data” means the data and
information provided to or received by Processor pursuant to this Agreement,
whether directly from Merchant or through a Partner Platform or other third parties,
which Processor uses in connection with its performance of its rights and obligations
under this Agreement, including, without limitation, all Customer Data and
Merchant information collected by, or given to, Processor pursuant to the terms
of this Agreement.
“RDFI”
means the Receiving Depository Financial Institution, as defined in the Nacha
Rules.
“Receiver” means a person who has authorized an
Originator to initiate a credit Entry or debit Entry to the Receiver’s account
at the RDFI.
“Recurring Transaction” means a Card
Transaction or ACH Transaction whereby Merchant periodically charges a
Cardholder’s Card or submits Entries at substantially regular intervals as
payment for recurring goods, charitable donations or services (e.g., monthly
insurance premiums, yearly subscriptions, annual membership fees, etc.) which
are to be delivered or performed periodically without further affirmative
action by the Cardholder or Receiver.
“Regulatory Authority” means, as the
context requires, any federal, state, or local government or any agency, board,
commission, court, department, or division thereof, having jurisdiction,
supervisory authority, or enforcement powers over any Party to this Agreement,
but which does not include any Card Brand. Such Regulatory Authorities include,
but are not limited to, the U.S. Treasury Financial Crimes Enforcement Network
(“FinCEN”), OFAC, U.S. Treasury
Department Office of the Comptroller of Currency (“OCC”), Federal Deposit Insurance Corporation (“FDIC”), Board of Governors of the Federal Reserve System (“Federal Reserve”), Internal Revenue
Service (“IRS”), Federal Trade Commission (“FTC”), Consumer
Financial Protection Bureau (“CFPB”), and State of South Dakota.
“Reserve Account” means an account or
accounts established at Bank in the manner it proscribes and managed by Finix
for the deposit of funds received from Merchant pursuant to this Agreement as
collateral to protect Processor against actual or contingent liability or
losses that might be incurred by Processor should Merchant be unable or fail to
pay Chargebacks, Disbursements, adjustments, fees, penalties, and other charges
and obligations due to Processor, any Network, or government agency. All
Reserve Accounts will be held in a pooled custodial account in Bank’s name or
as otherwise determined by the Parties.
“Retrieval Request” means a request for
information by a Cardholder or Card Brand relating to a claim or complaint concerning
a Transaction.
“Rules” means the written rules and
regulations, operating rules, system manuals, procedures and requirements,
releases and interpretations thereof, and other requirements (whether
contractual or otherwise) imposed or adopted by any Network, including the PCI
Security Standards Council, LLC, American Express Data Security Requirements (DSR), and the American Express Data Security Operating Policy (DSOP), and Nacha, as the same may be amended from
time to time.
“Sales Draft” has the meaning set forth in Section 4 of the Card Processing Services Schedule.
“Services” means the collective
activities undertaken by Processor to provide, as applicable, (i) the Card
Processing Services; (ii) the ACH Processing Services; (iii) the Disbursement
Services; and (iv) all other activities necessary for Processor to perform the
functions required by this Agreement.
“Services
Schedules” means terms in this Agreement that govern particular Services
and are set forth in a separate schedule.
“Settlement Account” means the business
checking account(s) or other acceptable deposit account(s) that Merchant
maintains at a financial institution approved by Processor for credits and
debits related to Transactions, Chargebacks, Fees, and any fines or Fees
assessed by the Networks or other governmental agency or entity having
authority.
“Settlement Funds”
means funds received by Processor from Networks for Merchant Transactions
submitted to Processor through the Services.
“Settlement
Payout Schedule” means the schedule(s) selected by Merchant or Partner Platform
and approved by Finix for settling Transactions to Merchant’s Settlement
Account, and which may include same-day settlement and similar faster payout
services to the extent offered by Processor. Processor is not responsible for
any delays impacting a Settlement Payout Schedule caused by (i) the
unavailability of a Network, telecommunications provider, or internet service
provider; (ii) incorrect payout information provided to Processor; (iii)
Merchant’s equipment, software, or other technology; or (iv) a Force Majeure
Event.
“Suspicious Activity” means (i) unusual
or suspicious activity, including, without limitation, unauthorized
Transactions, suspected or actual fraud, and/or breach or default of this
Agreement, or (ii) during any monthly period for any one of Merchant’s MIDs:
(a) the dollar amount or number of Chargebacks and Retrieval Requests exceeds
1% of the average monthly dollar amount or number of Card Transactions; (b)
sales activity that exceeds by 25% or more the dollar volume indicated on the Application;
(c) the dollar amount of returns equals 3% of the average monthly dollar amount
of Card Transactions (d) the rate at which ACH debit Entries are being returned
for administrative reasons equals or exceeds 3% during any sixty (60) day
period; (e) the rate at which ACH debit Entries are being returned on the basis
that they were unauthorized equals or exceeds 0.5% during any sixty (60) day
period; or (f) the rate at which ACH debit Entries are being returned,
regardless of the reason, equals or exceeds 15% during any sixty (60) day
period.
“Term”
has the meaning set forth in Section 7.1 of the General Terms.
“Transaction” means any payment
transaction processed under this Agreement, and includes the Authorization,
settlement, and if applicable, disputes, Chargebacks, refunds and reversals
with respect to any payment transaction. The term Transaction includes, as
applicable, all types of ACH Transactions, Card Transactions, and
Disbursements.
“Update”
means any upgrades, patches, enhancements, or fixes to the Services or Finix
Technology that requires Merchant to take some action to install or implement.
Card Processing Services
Schedule
1.
ACCEPTANCE OF CARDS. Merchant agrees to honor all valid Cards
it elects to accept pursuant to the Agreement, without discrimination, and to
submit all sales and credits for Card Transactions to Processor according to
the terms of the Agreement. Merchant agrees to properly obtain an Authorization
code for the total amount of the Card Transaction and will record the
Authorization code on the Transaction data prior to completing the Transaction.
Processor reserves the right to refuse to process any Card Transaction
presented by Merchant that does not include a proper Authorization. For in-person purchases, Merchant will use reasonable and peaceful means to recover any Card if: (i) Merchant is advised by Processor or the Issuing Bank to retain it; or (ii) Merchant has reasonable grounds to believe the Card is counterfeit, fraudulent, stolen, or not authorized by the Cardholder.
2.
DEBIT NETWORKS. Debit Networks may be added or removed from time to time by Processor in its sole discretion. Merchant shall display the logos of the Debit Networks wherever any other Card Brand marks are displayed. The Debit Network used to process a Transaction will depend on the availability of the network at the time of the Transaction, whether a particular Card is enabled for a particular Network, and the routing requirements established by the Networks. Processor may use any Debit Network available to Processor for a given transaction.
3.
AUTHORIZATION. Merchant will obtain prior Authorization for the total amount of a Card Transaction via electronic terminal, gateway, or other compliant and certified device before completing any Card Transaction, and Merchant will not process any Card Transaction that has not been authorized by the Cardholder. Merchant will follow all instructions received during the Authorization process. Merchant may complete only the Card Transaction authorized. Authorizations are not a guarantee of acceptance or payment of the Sales Draft. Authorizations do not waive any provisions of this Agreement or otherwise validate a fraudulent Card Transaction or a Card Transaction involving the use of an expired or otherwise invalid Card.
4.
SALES DRAFTS. Merchant will obtain evidence of a Cardholder’s purchase of goods or services using the form, whether paper or electronic, required by Processor or the Rules (“Sales Draft”). Each Sales Draft will be legibly imprinted with: (i) Merchant’s name, identification number, and city and state; (ii) the information embossed on the Card presented by the Cardholder (either electronically or manually); (iii) the date of the Card Transaction; (iv) a brief description of the goods or services sold; (v) the authorization number; (vi) the total amount of the sale (including any applicable taxes) or credit Transaction; and (vii) adjacent to the signature line, a notation that all sales are final, if applicable. Merchant will not prepare more than one Sales Draft for a single sale or for a single item and shall include all items or good and services purchased in a single Transaction in the total amount on a single Sales Draft except as may be otherwise permitted under the Rules. Merchant will request that each Cardholder sign for all Card Transactions greater than $25.00 when the Cardholder is present. Merchant will provide a complete and legible copy of the Sales Draft or credit voucher to the Cardholder at the time of the Card Transaction. If Merchant uses an electronic terminal to print Sales Drafts, the account number must be truncated so that only the last 4 digits of the account number appear on the Cardholder copy of the Sales Draft. The expiration date must be suppressed on receipts provided to Cardholders. Merchant will retain in a secure and confidential manner original or complete and legible copies of each Sales Draft for at least two (2) years or longer if required by Applicable Law or the Rules. Merchant will render all materials containing Cardholder account information unreadable prior to discarding. If Processor requests a copy of a Sales Draft or other Card Transaction information, Merchant will provide it within 24 hours following the request.
5.
RESTRICTIONS.
5.1.
Except
where expressly permitted by Applicable Law or the Rules, Merchant will not (i)
set a dollar amount above or below which Merchant refuses to honor otherwise
valid Cards; (ii) engage in any practice that unfavorably discriminates against
or provides unequal treatment of any Card Brand; (iii) require the Cardholder
to pay the Fees payable by Merchant under this Agreement; (iv) issue refunds
for Transactions by cash or cash equivalent (e.g., check); (v) submit a single
Transaction in multiple lower value Transactions; (vi) refuse to honor an
otherwise valid Card; (vii) accept Cardholder payments for previous charges
incurred at the Merchant location; (viii) impose any surcharge or convenience
fee on a Transaction; (ix) accept Cards for the sale of casino gaming chips,
money orders, opening deposits on financial or other accounts, wire transfer
money orders, the issuance of scrip or the like; (x) require a Cardholder, as a
condition of honoring a Card, to sign a statement that waives the Cardholder's
rights to dispute the Transaction with the Card Brand; (xi) fail to disclose to
any Cardholder the name and location of Merchant; (xii) require a Cardholder to
complete a postcard or similar device that includes any of the following in
plain view when mailed: Cardholder account number, Card expiration date,
signature or any other Card account data; (xiii) disburse funds in the form of
travelers cheques, if the sole purpose is to allow the Cardholder to make a
cash purchase of goods and services from Merchant; (xiv) accept payments for (a)
collecting or refinancing debt that has been deemed uncollectible by Merchant, (b)
previous Card charges, or (c) Transactions that represent collection of a
dishonored check; (xv) add any tax to Transactions unless required by Applicable
Law; or (xvi) request or use account numbers for any purpose other than as
payment for goods or services.
5.2.
5.2. Merchant will not accept any cash payments from Cardholders for charges included on a Card Transaction. Merchant will not make any cash disbursements or cash advances to a Cardholder as part of a Card Transaction, except as permitted by Section 8.2. Merchant
will not deposit any Transaction for the purpose of obtaining or providing a
cash advance either on Merchant’s Card or the Card of any other party. Merchant will not submit (i) any Transaction previously
submitted to Processor; (ii) any Transaction that Merchant knows or should have
known to be fraudulent or not authorized by the Cardholder; (iii) any
Transaction that results from a transaction outside of Merchant's normal course
of business; (iv) any Transaction that results from a transaction not involving
Merchant or not originated as the result of an act between Merchant and a
Cardholder; (v) any Transactions that was previously disputed and subsequently
returned to Merchant; or (vi) any Transaction that is illegal or that Merchant
knows or should have known was illegal.
5.3.
Merchant
agrees that it will not submit Transactions in connection with the sales of
goods or services for future delivery to Customers or custom-made goods without
the prior approval of Processor. If Merchant is so approved for future
delivery, Merchant agrees to maintain operations, finances, and capital
sufficient to provide for the delivery of such goods and services at the
agreed-upon future date, without reliance upon any proceeds resulting from Transactions
previously submitted for processing under this Agreement. Processor reserves
the right to refuse to process any Transaction presented by Merchant if
Processor reasonably believes that the Transaction may be uncollectible from
the Cardholder or was prepared in violation of any provision of this Agreement,
Applicable Law, or the Rules.
5.4.
If
made available by Finix, Finix will provide Merchant the account updater
services provided by the Card Brands or similar services (which may involve use
of Network tokens) in connection with processing Cards. These services enable
Issuing Banks or Networks to supply the most current Cardholder information to
U.S. acquirers and U.S.-acquired merchants. In providing this service, Finix will
obtain, on Merchant’s behalf, applicable updated Cardholder Data of eligible
Cards from participating Issuing Banks and other third-party sources with
respect to eligible Card Transactions. The account updater services will be
used to support Recurring Transactions and other account-on-file functions.
6.
DATA SECURITY; SOFTWARE.
6.1. Merchant will comply at all times with the
Payment Card Industry Data Security Standard (“PCI DSS”) and any other security
standards required by the Card Brands, including any subsequent updates
thereto. Merchant will ensure that its service providers with access to
Customer Data comply, and are able to demonstrate compliance, with the PCI DSS
and Card Brand security requirements, including any subsequent updates.
6.2.
Merchant
will retain in a secure and confidential manner original, complete, and legible
copies of each Transaction for at least two (2) years or longer if required by
law or the Rules. Merchant will render all materials containing Customer Data
unreadable prior to discarding.
6.3.
Merchant
will store Transaction data in an area limited to selected personnel, and when
record-retention requirements have been met, Merchant will destroy the records
so that Transaction data is rendered unreadable.
6.4.
Merchant
will not provide Customer Data to anyone except Processor, Card Brands, or
Merchant's agents that have been approved by Processor as required under this
Agreement and are properly registered with the Card Brands for the purpose of
assisting Merchant in completing Transactions, or as specifically required by
Applicable Law.
6.5.
Merchant
will not retain or store Customer Data, including but not limited to, Card
magnetic stripe, CVV, CVV2, CVC2, or CID data subsequent to Authorization for a
Transaction or sell, purchase, provide, or exchange Customer Data to any third
party, or to any entity other than Processor, the Card Brands, or in response
to valid legal process or subpoena. Under the Rules, Merchant does not own the
Customer Data, Card account, Cardholder, personal, or other payment transaction
information generated when a payment transaction is processed using the
Services.
6.6.
Merchant
agrees to provide Processor, upon its request, with such tests, scans, and
assessments of Merchant’s compliance with Rules as may from time to time be
required by Processor or the Card Brands. Additionally, Merchant will allow
Processor or any Card Brand to audit its compliance with the requirements of
this Section related to the Services provided in this Agreement.
6.7.
Merchant
understands that failure to comply with the Rules or the compromise of any
Customer Data may result in assessments, fines, and/or penalties by the Card
Brands, and Merchant agrees it is liable for and will indemnify and reimburse
Processor immediately for any such assessment, fine, or penalty imposed on
Processor and any related loss, cost, or expense incurred by Processor. If
Processor or any Card Brand requires a forensic examination of Merchant or any
of Merchant’s service providers, agents, business partners, contractors, or
subcontractors due to a data breach incident or suspected event, Merchant
agrees to cooperate with such forensic examination until it is completed,
including, without limitation, the engagement of an examiner acceptable to
Processor or the relevant Card Brand. Notwithstanding the foregoing, the Card
Brand may directly engage, or demand that Processor engage, an examiner on
behalf of Merchant in order to expedite the investigation of the data breach
incident or suspected event. In either scenario, Merchant agrees to pay for all
costs and expenses related to such forensic examination, including all of
Processor’s reasonable attorneys’ fees and other costs relating to such
forensic examination. Merchant will take all actions that the Card Brands
require in connection with any investigation and remediation of any real or
suspected data breach incident or event.
7.
SOFTWARE; EQUIPMENT.
7.1. Merchant agrees to use terminals and
related software systems or equipment acceptable to Processor. Merchant may,
but is not obligated to, obtain equipment from Finix. If Merchant obtains any
such software systems or equipment from Finix, the terms and conditions
governing such systems and equipment will be set forth in a separate Services Schedule,
and Merchant agrees to pay Finix any fees or charges set forth in such Services
Schedule, and comply with any additional terms and conditions provided in
connection with such systems and equipment. Merchant will allow for the
implementation of any system changes required by Finix.
7.2.
If
Merchant incorporates an interface between software solutions for data transfer
or any other means, it will be Merchant’s sole and exclusive responsibility to
create, maintain, and support such interface and Merchant will defend,
indemnify, and hold Processor harmless from and against any and all demands,
claims, losses, liabilities, damages, costs, and expense of every kind and
nature, including, but not limited to, claims of infringement, attorneys’ fees,
court costs, and litigation expenses, arising from, in connection with, or by
virtue of, either directly or indirectly, the use of any such interface. Any
such interface must be fully compatible with the processing systems and
networks established and used by Finix. Merchant agrees that Processor is not
liable for damages of any type or kind caused, by virtue of, or in connection
with, either directly or indirectly, the use, malfunction, or failure of any
interface utilized by Merchant to operate or function in whole or in part and
that Processor has no responsibility to service, maintain, or repair any
interface utilized by Merchant. If Finix elects in its sole and exclusive
discretion to implement any interfaces elected by Merchant (it being understood
that Finix has no such obligation to do so), if the implementation process
requires consulting assistance from Finix, Merchant will be billed at Finix’s then-current
rates, which will be calculated from the time the consultation assistance
began. Further, any consultation assistance provided by Finix will not negate
in any way the non-liability on the part of Processor with respect to the
utilization by Merchant of any interface.
8.
ADDITIONAL REQUIREMENTS FOR PIN DEBIT TRANSACTIONS. The following additional provisions apply to PIN Debit Card Transactions:
8.1. Merchant may not complete a PIN Debit Card Transaction without the Cardholder’s entry of the PIN through the point of sale or card terminal.
Merchant must not require or request a Cardholder signature for PIN Debit Card acceptance.
Merchant must not require additional information, other than the PIN, for the completion of the Transaction unless specifically required by the Rules.
Merchant must not process a Card Transaction to provide a refund on a PIN Debit Card Transaction. PIN Debit Card Transactions must be authorized and processed electronically. Merchant is responsible for any adjustments to PIN Debit Card transactions that are made in error. Merchant will instruct employees not to ask any Cardholder to disclose a PIN. In the event Merchant or employee(s) becomes aware of any Cardholder’s PIN, Merchant or employee(s) will not use such PIN or create or maintain any record of such PIN, and will not disclose such PIN to any other person.
8.2. If Merchant offers cashback to Cardholders when they make a PIN Debit Card purchase, cashback Transactions shall be limited to the maximum of $200.00 per Cardholder on any Transaction date. If Merchant allows Cardholders to initiate cashback Transactions, Merchant must transmit to the Debit Network in its Transactions message for each cashback Transaction the amount of cashback given to the Cardholder pursuant to the point-of-sale Transaction. If Merchant receives, in response to a request for authorization for a cashback Transaction involving the purchase of goods and services, a denial code indicating that a cashback Transaction has been denied solely because the cashback portion of the PIN Debit Card Transaction would cause the Cardholder to exceed a limit on cash withdrawals imposed on the Cardholder by the Issuing Bank, Merchant shall inform Cardholder that the Transaction was denied because it would cause the Cardholder to exceed such limit on cash withdrawals, but that a new PIN Debit Card Transaction in the amount of the purchase alone may be approved.
8.3. 8.3. Merchant must place PIN-pad(s) where Cardholders can input PINs without revealing PINs to another individual, including Merchant or its employee(s). Merchant must ensure the PIN message is encrypted, using a compliant encryption method, from the PIN-pad to the point-of-sale terminal, and from the point-of-sale terminal to the Debit Network and back (end-to-end). The PIN encryption method considered compliant is the method mandated by the Networks and the Rules. Merchant may only use a PIN entry device certified by Processor and listed as compliant by the Networks and Rules for submitting PIN Debit Card Transactions. Merchant will comply with any other requirements relating to PIN security as required by Processor or any Network. Merchant agrees that if Merchant does not use a point-of-sale terminal that has been certified EMV chip card compliant and enabled or when a lost or stolen chip and PIN card is used at an EMV enabled terminal capable of processing chip and signature only, Merchant may be liable for payment of any Transactions submitted for chargeback by the applicable EMV chip card issuer(s).
9.
ADVERTISING AND PROMOTION.
9.1. Merchant will display Card Brand and
Processor marks, advertising, and promotional materials in compliance with the
Rules, this Agreement, and any usage guidance provided by Processor. Merchant will
make no other use of the emblems or marks of any Card Brand, Bank, or Finix without
Processor’s prior written consent. Merchant will not use the Card Brand marks
other than to display decals, signage, advertising, and other forms depicting
the Card Brand marks that are provided to Merchant by Processor. Merchant will
not use Card Brand marks in such a way that Cardholders could believe that the
products or services offered by Merchant are sponsored or guaranteed by the
Card Brand. Merchant recognizes that it has no ownership rights in the Card
Brand or Processor marks and agrees not to assign to any third party any of the
rights to use the Card Brand marks.
9.2. Merchant will immediately discontinue use
of all Card Brand and Processor marks, emblems, or names upon the sooner of (i)
direction to do so from Processor or any Card Brand; or (ii) termination of
this Agreement.
10.
CHARGEBACKS.
10.1. Merchant has full liability and
responsibility for all Chargebacks. If Merchant has a reason to dispute or
respond to a Chargeback, then Merchant must do so by the date provided on the
applicable Chargeback notice. Processor will not investigate or attempt to
obtain a reversal or other adjustment to any Chargeback if Merchant has not
timely responded to the notice.
10.2. Each Chargeback is immediately due and
payable by Merchant. Without limiting Processor’s other remedies or Processor’s
security interest described in this Agreement, Processor may deduct, debit, and
withhold the amount of a Chargeback or anticipated Chargeback from Settlement
Funds, the Settlement Account, Reserve Account, or any amounts owed to Merchant
by Processor under this Agreement. Merchant must immediately pay any fines or
fees imposed by a Card Brand or Processor relating to Chargebacks.
10.3. Merchant will store and retain Transaction
data in compliance with the Rules, including any periods set forth therein.
Within seven (7) days (or such shorter time as the Rules may require) of
Processor sending Merchant a Retrieval Request, Merchant must provide to Processor
(i) written resolution of Merchant’s investigation of such Retrieval Request;
and (ii) legible copies of any supporting documentation requested or required
by the Retrieval Request. Merchant acknowledges that failure to fulfill a
Retrieval Request timely and in accordance with the Rules may result in an
irreversible Chargeback.
10.4. To the extent that Processor has paid or
may pay a Chargeback or return, Merchant will be obligated to reimburse
Processor for any sums Processor has paid. If Merchant does not reimburse
Processor, Processor will have all of the rights and remedies of Cardholders
under law and may assert any claim on behalf of a Cardholder individually or on
behalf of all Cardholders as a class.
11.
AMERICAN EXPRESS TRANSACTIONS.
11.1. Finix, and not Bank, will provide all Services
to Merchant for its Transactions submitted to American Express. With respect to participation in an American
Express acceptance program, if a conflict between the terms below and other
terms of this Agreement, the terms in this Section will control. Merchant’s
participation in an American Express acceptance program may be subject to the
approval of American Express. Merchant
authorizes Finix to submit American Express Transactions to, and receive Settlement
Funds on such Transactions from, American Express on behalf of Merchant into the pooled custodial account at Bank as set forth in Section 5.1 of the General Terms. Merchant agrees to be bound by the American Express Merchant Operating Guide:
www.americanexpress.com/merchantopguide, which may be updated from time to time by American Express. Merchant will ensure that data quality (including Transaction data and customer information) is processed promptly, accurately and completely, and complies with the American Express Technical Specifications. Merchant may opt out of accepting American Express Cards at any time without penalty and without directly or indirectly affecting its rights to accept other payment products.
11.2. 11.2. Merchant agrees not to assign to any third party any American Express Transaction Settlement Funds due to it under this Agreement, and that all indebtedness arising from American Express Transactions will be for bona fide sales of goods and services (or both) at its locations and free of liens, claims, and encumbrances other than ordinary sales taxes; provided, however, that Merchant may sell and assign future Transaction Settlement Funds to Finix, its affiliated entities, and/or any other cash advance funding source that partners with Finix or its affiliated entities, without consent of American Express.
11.3. Finix may disclose information regarding
Merchant and Merchant’s Transactions to American Express, and American Express
may use such information to (i) perform its responsibilities in connection with
American Express Card acceptance; (ii) promote American Express; (iii) perform
analytics and create reports; and (iv) for any other lawful business purposes,
including commercial marketing communications purposes within the parameters of
American Express Card acceptance, and to provide important transactional or
relationship communications from American Express. American Express may also
use such information about Merchant obtained in connection with this Agreement
at the time of setup to screen and/or monitor Merchant in connection with
American Express marketing and administrative purposes.
11.4. Merchant may opt-out of receiving future
commercial marketing communications from American Express by contacting Finix.
Note that Merchant may continue to receive marketing communications while
American Express updates its records to reflect this choice. Opting out of
commercial marketing communications will not preclude Merchant from receiving
important transactional or relationship messages from American Express.
11.5. Merchant acknowledges that it may be
converted from American Express Card OptBlue program to a direct relationship
with American Express if and when its Transaction volumes exceed the
eligibility thresholds for the OptBlue program. If this occurs, upon such
conversion, (i) Merchant will be bound by American Express’s then-current Card
Acceptance Agreement; and (ii) American Express will set pricing and other fees
payable by Merchant.
11.6. Notwithstanding anything in the Agreement
to the contrary, American Express will have third-party beneficiary rights, but
not obligations, to the terms of this Agreement applicable to American Express
Card acceptance to enforce such terms against Merchant.
11.7. Merchant’s refund policies for American
Express purchases must be at least as favorable as its refund policy for
purchase on any other Card Brand. Merchant may not bill or attempt to collect
from any Cardholder for any American Express Transaction unless a Chargeback
has been exercised, Merchant has fully paid for such Chargeback, and it
otherwise has the right to do so.
ACH Processing Services
Schedule
This ACH Processing Services Schedule governs
Merchant’s use of the ACH Processing Services provided by Processor pursuant to
the Agreement. For purposes of this ACH Processing Services Schedule, the term
“Receiver” may include a Customer or Merchant Payee. The General Terms continue to apply with
respect to the provision of the ACH Processing Services. In connection with the
ACH Processing Services, Bank will act as the ODFI with respect to Entries and
Merchant authorizes Processor to originate Entries on behalf of Merchant to
Receivers’ accounts. In connection with the ACH Processing Services, Merchant
agrees to comply with: (i) the Nacha Rules for all Entries; (ii) any operating
rules and procedures established by Processor; and (iii) Applicable Law.
Merchant acknowledges that a copy of the Nacha Rules is available through Nacha.
If there are any inconsistencies between the ACH Processing Services Schedule
and the Nacha Rules, the Nacha Rules will govern. Capitalized terms not defined
in this ACH Processing Services Schedule have the meanings in the General
Terms.
1. PROCESSOR’S
AGREEMENT TO PROCESS ENTRIES. Finix agrees to use reasonable care to (i)
comply with instructions of Merchant; and (ii) process Entries received from
Merchant to conform with the specifications set forth in the Nacha Rules or as
otherwise required by Processor. Bank agrees
to use reasonable care to (i) transmit such Entries as an ODFI to the ACH
Operator (as determined in Processor’s sole discretion); and (ii) settle such
Entries as provided in the Nacha Rules and this ACH Processing Services
Schedule. Merchant will be solely responsible for ensuring the validity,
accuracy, and completeness of all information, data, files, and instructions
provided or transmitted to Processor. Processor will be entitled to rely upon
all such information in providing the ACH Processing Services and will have no
liability in connection with such reliance. Processor will not be required to
act on instructions provided by Merchant if Processor reasonably doubts an
instruction’s contents or Merchant’s compliance with Applicable Law, the Nacha
Rules, or this Agreement. Merchant will prepare each Entry or file or API transmitting
requested Entries in accordance with the Nacha Rules and any additional
requirements that may be provided by Processor. All Entries transmitted by
Merchant to Processor for processing must comply with the formatting and other
requirements in the Nacha Rules or as otherwise required by Processor.
2. MERCHANT
AUTHORIZATION. Merchant
hereby authorizes Processor to initiate debit and credit Entries to Merchant’s
Settlement Account. Merchant’s authorization will continue in effect for at
least one hundred eighty (180) days after termination of this Agreement, or for
a longer period as is determined necessary by Processor in the exercise of its
sole discretion. Merchant agrees that
Merchant is only authorized to originate CCD (Corporate Credit or Debit Entry),
PPD (Prearranged Payment and Deposit), and WEB (Internet-Initiated/Mobile)
Entries.
3. PROCESSING
ACH TRANSACTIONS. Processor
will process each Entry in accordance with Processor’s then-current processing
schedule and any instructions regarding the date an Entry is to be settled that
Merchant furnishes with the Entry (including any instructions provided for
same-day Entries), provided that: (i) Processor receives the Entry by
Processor’s applicable cutoff time on a Business Day (“Cut-Off Time”); and (ii) the ACH Operator
is open for business on such day. Entries will be deemed received by Processor
when the transmission of the Entry to Processor is completed and authenticated
in compliance with Processor’s policies and procedures. If Processor receives
an Entry after the applicable Cut-Off Time, the Entry will be treated as having
been received prior to Processor’s applicable Cut-Off Time the next Business
Day on which the ACH is open for business. Processor, in its sole discretion,
may process Entries it receives from different merchants in any order Processor
determines and may select such means and routes for the transfer of funds as
Processor considers appropriate under the circumstances. Processor will not be
liable to Merchant for any delays in processing or settlement. Processor will instruct
the ACH Operator to settle with the Receiver’s RDFI in the amount of such Entry
on the Effective Entry Date contained in such Entry, provided (i) such Entries
are received by Processor’s Cut-Off Time; and (ii) the ACH Operator is open for
business on such Business Day. If either of these requirements is not met,
Processor will use reasonable efforts to settle with the Receiver’s RDFI no
later than the next Business Day.. In addition to the applicable Cut-Off Time
for same-day Entries, Merchant agrees to comply with any other instructions or
limitations established by Processor or Nacha for such Entries.
4. SETTLEMENT. All payments received by Processor on
behalf of Merchant for legitimate and authorized ACH Transactions will be
transmitted to Merchant’s Settlement Account pursuant to the Settlement Payout
Schedule. Chargebacks received after an ACH Transaction has been settled may be
offset and deducted from Settlement Funds or Chargebacks may be charged back to
Merchant’s Settlement Account or Reserve Account at Processor’s discretion.
Merchant specifically authorizes Processor to debit Merchant’s Settlement
Account or Reserve Account via ACH for any previously funded ACH Transaction
that is returned, and Merchant warrants to Processor that Merchant will
maintain a sufficient balance to cover return Entries and to promptly notify
Processor of any changes to Merchant’s Settlement Account. In addition,
Processor may require additional monetary sums for the Reserve Account in
connection with the ACH Processing Services, and Processor reserves the right
to hold additional monies as necessary to reduce any risk associated with the
daily processing of ACH Transactions, as requested by Merchant. Merchant
understands that due to the nature of ACH Transactions and the electronic
networks, payment to Merchant can be delayed. In such cases, Merchant agrees to
work with Processor to resolve any issues in crediting or debiting Merchant’s
Settlement Account. For a credit
Entry subject to Article 4A of the Uniform Commercial Code, credit given by an
RDFI to the Receiver for an Entry is provisional until the RDFI has received
final settlement through a Federal Reserve Bank or otherwise has received
payment as provided for in Section 4A-403(a) of Article 4A of the Uniform
Commercial Code. If the RDFI does not receive payment for the Entry, the RDFI
is entitled to a refund from the Receiver in the amount of the credit to the
Receiver’s account, and Merchant, as the Originator, will not be considered to
have paid the amount of the credit Entry to the Receiver.
5. RETURNS
AND CREDITS.
5.1.
Refunds,
Returns, Receipts.
Merchant will be responsible for making all cash, check, or ACH refunds to Receivers
after an ACH Transaction has been batched out for settlement. Unless otherwise
approved by Processor, Merchant must initiate a credit receipt for the same
amount as the original ACH entry to effect voids, which occur the same day as
the day of Authorization and prior to batching out. Prior to Merchant requesting Processor to process a
debit or credit Entry to a Receiver’s account, Merchant shall secure all
authorizations and approvals from its Receivers and deliver any notifications
pertaining to that entry which are required by the Nacha Rules and/or
applicable laws and regulations. Merchant shall retain such consents and
authorizations for two (2) years from the termination or revocation of the
authorization and provide copies of such authorizations to Processor upon
reasonable request. Each void, debit, and credit Entry will constitute a
separate Transaction for which Fees may apply. If it becomes necessary for a
reversal of a Transaction to be initiated, Merchant will submit a request to
Processor to initiate such reversal pursuant to Processor’s requirements.
Merchant will give Processor enough information to create such reversal.
5.2. Cancellation, Amendment, Reversal. Merchant has no right to cancel, amend,
or reverse an Entry after Processor has received such Entry. If Merchant
requests Processor to cancel, amend, or reverse an Entry, Processor may, in its
sole discretion, attempt to honor such request, but will have no liability for
its failure to do so. Merchant agrees to reimburse Processor for any expenses,
losses, or damages Processor incurs in effecting or attempting to effect
Merchant’s request.
5.3. Returned Entries. Finix will notify Merchant of the
receipt of a returned Entry no later than two (2) Business Days after the day
on which Processor receives such returned Entry. To the extent Processor has
complied with this ACH Processing Services Schedule with respect to the
original Entry, Processor will have no obligation to re-transmit a returned
Entry to the ACH Operator. Merchant will not knowingly resubmit debit Entries
returned due to stop payment or a revocation or termination of the Receiver’s authorization.
Merchant agrees to reimburse Processor for any returned debit Entries on the
same day Merchant receives notice of such returned Entry.
5.4. Late and Rejected Entries. Any Entries received after the Cut-Off
Time will be processed the following Business Day. Any exceptions that may be
allowed, in Processor’s sole discretion, may be subject to a late fee assessed
by Processor. Finix will notify Merchant of late or rejected Entries. Processor
may reject any Entry that does not, in Processor’s sole determination, comply
with the requirements of this Agreement.
5.5. Inconsistency of Name and Number. Merchant agrees that if an Entry identifies
a Receiver by both name and identifying number, the RDFI may pay the Entry on
the basis of the identifying number, even if the number identifies a person
different from the named Receiver. If an Entry describes the RDFI by name and
identifying number, Processor, an ACH Operator, or another financial
institution handling the Entry may rely on the identifying number to identify
the RDFI, even if the identifying number refers to an institution other than
the named RDFI.
5.6. Notice of Changes. Finix will provide Merchant with all
information required by the Nacha Rules with respect to each Notification of
Change (“NOC”)
Entry or Corrected Notification of Change (“Corrected NOC”) Entry received by Processor relating to
Merchant’s Entries. Finix will provide such information to Merchant within one
(1) Business Day of the Settlement Date of each NOC or Corrected NOC Entry.
Merchant will ensure that changes requested by the NOC or Corrected NOC are
made within six (6) Business Days of Merchant’s receipt of the NOC information
from Processor or prior to initiating another Entry to the Receiver’s account,
whichever is later.
6. MERCHANT
COMPLIANCE.
6.1.
Merchant will not
request Processor to initiate Entries that violate Applicable Law or Nacha
Rules. Merchant
is solely responsible for any and all losses incurred by Merchant or Processor if
Merchant initiates any Transaction prohibited by Applicable Law or Nacha Rules.
Merchant will provide such information and certifications as Processor may
reasonably require from time to time within two (2) Business Days of a request
(subject to Processor’s right, in its sole discretion, to provide extensions)
so that Processor may determine Merchant’s compliance with this ACH Processing Services
Schedule, the Nacha Rules, and Applicable Law. Before Merchant initiates any
Entry, Merchant will obtain from the Receiver such authorization as is required
by the Nacha Rules and Applicable Law. Merchant will not initiate an Entry
after such authorization has been revoked or the arrangement between Merchant
and the Receiver has terminated. Merchant represents and warrants with respect
to all Entries originated by Merchant and processed by Processor for Merchant
that (i) each Receiver has authorized the debiting and/or crediting of its
account; (ii) each Entry is for an amount agreed to by the Receiver; and (iii)
each Entry is in all other respects properly authorized. Merchant is prohibited
from disclosing a Receiver’s account number or routing number to any third
party for use in initiating a debit Entry that is not part of the original authorization.
Merchant agrees that the ACH payment instructions it sends to Processor will
constitute authorization for the origination of an Entry on Receiver’s behalf.
6.2.
Once
Processor authorizes an ACH Transaction, Merchant will ensure that the proof of
purchase contains the following correct information: (i) Merchant’s correct
name and business address; (ii) the date of the Transaction; and (iii) the
total cash price of the sale or ACH transfer (including all applicable state, federal,
or local surcharges and taxes. Merchant will deliver to the person presenting
the ACH Transaction a true and completed copy of the proof of purchase with the
goods and services purchased. No ACH Transaction may be altered after Processor
authorizes acceptance of the ACH Entry. Merchant may not resubmit an ACH Entry
electronically or deposit it by any means once Processor authorizes a Transaction.
Failure to comply with the above requirements may, in addition to other
penalties, be grounds for immediate suspension/termination of services and
indemnification of Processor by Merchant pursuant to this Agreement.
6.3.
Merchant
agrees not to submit any of the following Transactions to Processor for
electronic processing: (i) any ACH debit drawn on any depository institution
that is not federally insured or part of the ACH Network; (ii) any ACH debit or
credit drawn on the personal checking account of Merchant or any of its agents
or employees; (iii) any third-party items for electronic processing or ACH
debit made payable where the purpose is for the Receiver to receive cash or
cash back; (iv) any Transaction representing the financing of an existing
obligation whether previously owed to Merchant, arising from the dishonor of an
ACH Entry or arising from a dispute with Merchant; (v) a Transaction which
represents an attempt to collect a Chargeback; (vi) an ACH debit Entry for
goods or services that are not concurrently provided to the Receiver, including
any ACH debit given for gift certificate, a layaway (except for the final
payment) or for a similar Transaction, or for goods or services provided to a
third party; (vii) any Entry that is altered by Merchant in any way; (viii) an
ACH Entry on an account for which Processor previously denied authorization.
Merchant’s submission of any of the above Transactions for electronic
processing may subject Merchant to immediate suspension or termination, and all
funds of Merchant, including those in Merchant’s Reserve Account or Settlement
Account, may be placed on hold; or (ix) any ACH Entry initiated on account of a
third party other than Merchant.
7. SECURITY
PROCEDURES.
7.1.
Merchant
will comply with the security procedures described herein and in the Nacha Rules (“Security Procedures”)
with respect to Entries
transmitted by Merchant to Processor. Merchant acknowledges that the
purpose of such Security Procedures is for verification of authenticity and that
the Security Procedures are not designed or intended to detect errors in the
Entries initiated by Merchant and that Merchant bears the sole responsibility
for detecting and preventing such errors. Processor reserves the right to
change, amend, replace, or cancel any or all Security Procedures, at any time
and from time to time at Processor’s discretion. Processor may make any change
in Security Procedures without advance notice to Merchant if Processor, in its
judgment and discretion, believes such change to be necessary or desirable to
protect the security of Processor systems and assets.
7.2.
Merchant
acknowledges and agrees that the Security Procedures, including any code,
password, personal identification number, user identification technology, token,
certificate, or other element, means, or method of authentication or
identification used in connection with a Security Procedure (“Security Devices”) constitute
commercially reasonable security procedures under Applicable Law for the
origination of Entries or the request for cancellation or amendment of an
Entry.
7.3.
Merchant
authorizes Processor to follow any and all instructions entered and
Transactions initiated using applicable Security Procedures. Merchant’s
initiation of a Transaction using applicable Security Procedures constitutes
authorization for Processor to execute such Transaction, and Merchant agrees
and intends that the submission of Entries and instructions using the Security
Procedures will be considered the same as Merchant’s written signature in
authorizing Processor to execute such Transaction. Merchant acknowledges and
agrees that Merchant will be bound by any and all Entries initiated through the
use of such Security Procedures, whether authorized or unauthorized, and by any
and all Transactions and activity otherwise initiated by any person(s) authorized
by Merchant to initiate Transactions (“Authorized User(s)”), to the
fullest extent allowed by Applicable Law.
7.4.
Merchant
acknowledges and agrees that it is Merchant’s responsibility to keep all
Security Procedures and Security Devices protected and to provide or make
available the same only to Authorized User(s). Merchant warrants that no
individual will be allowed to initiate transfers of Entries in the absence of
proper supervision and safeguards, and agrees to take reasonable steps to
maintain the confidentiality of the Security Procedures and any Security Devices
provided by Processor in connection with the Security Procedures described in
the Nacha Rules. Merchant agrees to instruct each Authorized User not to
disclose or provide any Security Procedures or Security Devices to any
unauthorized person. Merchant agrees to notify Processor immediately if
Merchant believes that any Security Procedures, information, or instructions
have been compromised, or otherwise become known to or accessed by persons
other than Authorized User(s), or if Merchant believes that any Entry or
activity is unauthorized or in error. Merchant agrees to notify Processor
immediately if the access of any Authorized Users will change or be revoked.
The occurrence of unauthorized access will not affect any transfers of Entries
made in good faith by Processor prior to receipt of such notification and within
a reasonable time period to prevent unauthorized transfers.
7.5.
Merchant
is solely responsible for providing for and maintaining the physical,
electronic, and procedural security of data and systems in Merchant’s
possession or under Merchant’s control. Processor is not responsible for any
computer viruses (including, without limitation, programs commonly referred to
as “malware,” “keystroke loggers,” and/or “spyware”) resulting from any
computer viruses. Merchant is solely responsible for maintaining and applying
anti-virus software, security patches, firewalls, and other security measures
with respect to Merchant’s operating systems, and for protecting, securing, and
backing up any data and information stored in or on Merchant’s operating
systems. Processor is not responsible for any errors or failures resulting from
defects in or malfunctions of any software installed on Merchant’s operating
systems or accessed through an Internet connection. Merchant agrees that
Processor is not responsible for any losses, injuries, or harm incurred by
Merchant as a result of any electronic, e-mail, or Internet fraud.
7.6.
If
there is a breach of any Security Procedure, Merchant agrees to assist
Processor in determining the manner and source of the breach. Such assistance will
include, but will not be limited to, providing Processor, or Processor’s agent,
access to Merchant’s hard drive, storage media, and devices, systems, and any
other equipment or device that was used in breach of the Security Procedure.
Merchant further agrees to provide to Processor any analysis of such equipment,
device, or software or any report of such analysis performed by Merchant, Merchant’s
agents, law enforcement agencies, or any other third party. Failure of Merchant
to assist Processor will be an admission by Merchant that the breach of the
Security Procedure was caused by a person who obtained access to transmitting
facilities of Merchant or who obtained information facilitating the breach of
the Security Procedure from Merchant and not from a source controlled by
Processor.
7.7.
Merchant
will implement and maintain security policies, procedures, and systems related
to the initiation, processing, and storage of Entries and resulting Customer
Data. The policies, procedures, and systems will protect the confidentiality and
integrity of Customer Data, will protect against anticipated threats or hazards
to the security or integrity of Customer Data, will protect against the
unauthorized use of Customer Data, and will include controls on system access.
In addition, Merchant will ensure proper storage and destruction of authorizations,
converted checks, phone recordings, etc. The definition of Customer Data not
only covers financial information, but also includes sensitive non-financial
information (such as non-financial account information contained in addenda records
for bill payments) that may be incorporated into the Entry or any related addenda
record.
8. ADDITIONAL
TERMINATION RIGHTS. In
addition to Processor’s termination rights under the Agreement, Processor may
immediately terminate Merchant’s participation in the ACH Processing Services
or suspend provision of the ACH Processing Services if it determines in its
sole discretion that (i) the number of returned debit Entries originated is excessive;
or (ii) Merchant has breached the Nacha Rules, Applicable Law, or this
Agreement. Any termination of this ACH Processing Services Schedule will not
affect any of Processor’s rights and Merchant’s obligations with respect to
Entries initiated by Merchant prior to such termination, or the payment
obligations of Merchant with respect to services performed by Processor prior
to termination, or any other obligations that survive termination of this
Agreement.
Disbursement Services Schedule
This Disbursement Services Schedule
governs Merchant’s use of the Disbursement Services provided by Processor
pursuant to the Agreement. The General Terms continue to apply with respect to
the provision of the Disbursement Services. Capitalized terms not defined in
this Disbursement Services Schedule have the meanings in the General Terms.
1. DISBURSEMENT
PROCESS.
1.1.
Merchant
understands and acknowledges that the Disbursement Services operate on a good
funds model and that Processor must have received sufficient Settlement Funds
from the Networks in advance of the date on which Merchant instructs Processor
to make a payment to the Merchant Payee. At Merchant’s request, and if approved
by Processor, Processor will debit such payments from Settlement Funds and
Processor will remit such payments to the Merchant Payee through ACH or other
approved Disbursement methods, on behalf of, and in accordance with,
instructions provided by Merchant. Merchant
will be solely responsible for ensuring the validity, accuracy, and
completeness of all Disbursement information, data, files, APIs, or other instructions
provided or transmitted to Processor. Processor will be entitled to rely upon
all such information in providing the Disbursement Services and will have no
liability in connection with such reliance. Processor will not be required to
act on instructions provided by Merchant if (i) Processor reasonably doubts an
instruction’s contents or Merchant’s compliance with Applicable Law or this
Agreement; (ii) there are multiple or conflicting instructions; or (iii)
complying with the instruction may expose Processor to financial or reputational
risk or liability. If an instruction contains inconsistent or conflicting
information, including with respect to name and account number, Merchant agrees
that Processor may rely exclusively on the information provided. Merchant
agrees that it will be solely responsible for conducting identity verification
on each payee prior to submitting a Disbursement instruction to Processor.
1.2.
All
payments made to Merchant Payees will be remitted via ACH or such other
Disbursement methods that Processor may support, as such methods will be subject
to change in Processor’s sole discretion from time to time. The terms and
conditions set forth in the ACH Processing Services Schedule to this Agreement will
apply with respect to Disbursements made through ACH in connection with the
Disbursement Services. If Merchant instructs Processor to use Settlement Funds
for a Disbursement, Merchant agrees that such sending of funds by Processor to
the Merchant Payee satisfies Processor’s obligation to settle such Network
funds to Merchant.
1.3.
For
an ACH credit Entry subject to Article 4A of the Uniform Commercial Code,
credit given by an RDFI to the Receiver for an Entry is provisional until the
RDFI has received final settlement through a Federal Reserve Bank or otherwise
has received payment as provided for in Section 4A-403(a) of Article 4A of the
Uniform Commercial Code. If the RDFI does not receive payment for the Entry,
the RDFI is entitled to a refund from the Receiver in the amount of the credit
to the Receiver’s account, and Merchant, as the Originator, will not be
considered to have paid the amount of the credit Entry to the Receiver.
1.4.
Processor
may implement Cut-Off Times for the submission of Disbursement instructions,
which Cut-Off Times will be provided to Merchant, and which times will be
subject to change in Processor’s sole discretion from time to time. If
Processor receives a Disbursement instruction after the Cut-Off Time, Processor
will generally initiate the Disbursement on the next Business Day.
1.5.
Merchant
has no right to cancel, amend, or reverse a Disbursement instruction after
Processor has received such instruction. If Merchant requests Processor to
cancel, amend, or reverse an instruction, Processor may, in its sole
discretion, attempt to honor such request but will have no liability for its
failure to do so. Merchant agrees to reimburse Processor for any expenses,
losses, or damages Processor incurs in effecting or attempting to effect
Merchant’s request.
1.6.
Merchant
agrees that Processor may impose limits on the Disbursement Services in its
sole discretion. Merchant acknowledges that Disbursements may only be made to
accounts within the United States, unless otherwise approved by Processor in
its sole discretion. Merchant agrees that it may not submit Disbursement
instructions on behalf of third parties. Merchant will only submit Disbursement
instructions for payments that comply with Applicable Law, the Rules and this
Agreement.
1.7.
Merchant
agrees to assist Processor in any investigation or prosecution of claims for
unauthorized Disbursements.
2. MERCHANT
PAYEES.
2.1.
Merchant
will provide to Processor any information that Processor requests for purposes
of satisfying Processor’s internal compliance policies and procedures in
connection with the remittance of funds to the Merchant Payee. Merchant
acknowledges and agrees that Processor may, in its sole discretion, decline or
refuse to provide a payment to a Merchant Payee at any time pursuant to
Processor’s internal compliance policies and procedures.
2.2.
For
any Disbursements through the ACH Networks, Merchant agrees that it will be the
Originator as defined by the Nacha Rules, and that Merchant will comply with
the Nacha Rules and Applicable Law.
3. TRANSACTION
LIABILITY.
3.1.
Merchant
acknowledges that Processor is reliant on Merchant alone for instructions with
respect to payments made to Merchant Payees in connection with the Disbursement
Services. Processor will not be liable if a Merchant Payee makes a claim or
complaint with regard to Processor’s actions to the extent that such actions
result from instructions received from Merchant.
3.2.
Merchant
hereby assumes all liability for any costs or losses either Merchant or
Merchant Payees incur as a result of errors or omissions in the data and
instructions provided by Merchant to Processor, including any costs for any
errors or returns.
4. TAX
REPORTING AND WITHHOLDING.
Merchant acknowledges and agrees that Merchant is in the best position to
determine the nature of the payments delivered to Merchant Payees through the
Disbursement Services and whether any such payments are subject to reporting or
withholding obligations under Internal Revenue Code Section 6050W or other
Applicable Law. Merchant hereby accepts responsibility for such withholding and
reporting obligations and agrees to furnish to Processor such documents and
certifications related to its withholding obligations or those of Processor
upon request.