MASTER SERVICE AGREEMENT
Master Service Agreement ("Agreement") dated as of February 24, 1998
entered into by and between ALPHA MICROSYSTEMS, a California corporation,
("Alpha Micro"), and ATS MONEY SYSTEMS, INC., a Nevada corporation
("Client").
RECITALS:
A. Alpha Micro is in the business of providing hardware
maintenance services.
B. Client desires that Alpha Micro perform services on products
for customers designated by Client.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. SERVICES.
(a) Customers and Products to be Serviced. Alpha Micro will
provide service for products of Client's customers on a non-exclusive
basis as mutually agreed upon from time to time by Client and Alpha
Micro. The service will be performed by qualified technicians and in a
professional and workmanlike manner.
Client and Alpha Micro agree to document the products and customers
to whom Alpha Micro will provide service on Schedule "A" attached to this
Agreement, as it shall be amended from time to time. It is the intention
of Client and Alpha Micro to have a separate Schedule "A" for each
customer covered by this Agreement. In the event a customer or product
is included on a Schedule "A", Client shall be entitled to remove said
customer, a customer location and/or product from Schedule "A" if the
customer terminates its arrangement for Client to provide maintenance
services, closes a customer location and/or a product no longer requires
service.
Alpha Micro acknowledges that it has been informed by Client that it
is presently using another company (the "Vendor") to provide similar
services for Client's customers and that Client intends to transfer some
of its customers to Alpha Micro. In the event the Vendor refuses to
continue to service the Client's customers and/or terminates its
relationship with Client, Alpha Micro agrees to provide service to said
customers in accordance with the provisions of this Agreement within
forty five (45) days after requested to do so by Client. Furthermore,
the Client shall not be obligated hereunder with respect to the customer
reflected on Schedule "A" until such time as Client has terminated its
relationship with the Vendor with respect to said customer.
(b) Types of Services to be Provided. Services shall include
those designated below:
Alpha Micro will provide service and maintenance for the
products listed on Schedule "A". Such maintenance services
shall consist of repairs, when required, and routine
preventative maintenance, as determined by Alpha Micro, but
not less than once per year per site. Preventative
maintenance will include required cleaning, lubricating,
adjusting and testing for good operating results. Alpha Micro
will diagnose defective equipment, repair such equipment by
means of adjustment, if possible, or replacement of defective
parts or modules with components which are new or near
equivalent to new in performance or, if necessary, provide a
replacement unit. Alpha Micro will, when necessary, reinstall
software furnished by Client in connection with the repair or
replacement of equipment.
(c) Exclusions from Service.
Not included under this Agreement shall be warranty services
or post warranty maintenance services for (i) cosmetic damages due to
normal wear and tear; (ii) consumable items such as ribbons and paper;
(iii) damages due to abuse, neglect or shipping; (iv) software
maintenance or support (Alpha Micro will, when necessary, reinstall
software furnished by Client in connection with the repair or replacement
of equipment); (v) electrical work external to the equipment being
serviced; or (vi) damages due to any cause external to the equipment
adversely affecting its operability or serviceability which shall
include, but not limited to, fire, flood, wind and lightning.
(d) Response Time.
Alpha Micro will respond to all service requests during its
normal business hours (generally 8:00 a.m. to 6:00 p.m., local time,
Monday through Friday, excluding national holidays). The response time
for each customer covered by this Agreement is set forth in the Schedule
"A" annexed for that customer.
Requests for service shall be accepted by Alpha Micro from
Client or, if authorized by Client, directly from customer. Alpha Micro
shall not provide weekend service without Client's prior approval. If
weekend service is provided the rates listed on Schedule B shall apply.
In the event that Client's customers contact Alpha Micro directly for
service Alpha Micro will notify the Client of such request.
2. SPARE PARTS AND REPLACEMENT OF EQUIPMENT THAT CANNOT BE
REPAIRED.
(a) Client Responsibility to Provide Spare Parts and Swap Units.
Client shall provide Alpha Micro, at Client's cost, with all
parts necessary to perform the services contemplated hereunder
on currency counters and MICR encoders ("Client Equipment").
Client shall provide Alpha Micro with an inventory of parts to
be maintained by Alpha Micro for such services in not less
than those quantities necessary to enable Alpha Micro to
provide service on a one-stop diagnose and correct basis. In
addition, Client shall provide Alpha Micro, for each agreed
upon Alpha Micro regional center, with a functioning unit of
each type of Client Equipment covered by this Agreement
("Client Swap Unit(s)"). The Client Swap Units shall be used
as provided for in Section 2(c) below. At no time shall
Alpha Micro acquire title to such inventory or Client Swap
Units, and all parts and equipment furnished by Client shall
remain the property of Client until installed on equipment
covered by this Agreement or exchanged for equipment covered
by this Agreement. Alpha Micro shall not permit any lien or
encumbrance to be asserted against such inventory or Client
Swap Units, and shall indemnify Client for all parts or
equipment damaged, lost or otherwise unrecoverable while in
Alpha Micro's possession, and shall return to Client all parts
and Client Swap Units in its possession promptly upon
termination of this Agreement.
(b) Alpha Micro Responsibility to Provide Spare Parts and Swap
Units.
Alpha Micro shall maintain, at its cost, an inventory of
sufficient spare parts to meet the intent of this Agreement as
it relates to devices other than Client Equipment ("Alpha
Micro Equipment"). In addition, Alpha Micro shall maintain,
at each agreed upon Alpha Micro regional center, a functioning
unit of each piece of Alpha Micro Equipment ("Alpha Micro Swap
Unit(s)"). The Alpha Micro Swap Units shall be used as
provided for in Section 2(d) below. All parts and equipment
and Alpha Micro Swap Units removed from Client's customers'
and replaced by Alpha Micro, other than Client Equipment or
parts thereof, shall become the property of Alpha Micro.
(c) Responsibility for Replacement of Client Equipment That Cannot
Be Repaired.
Alpha Micro shall make every reasonable effort to repair, at
the customer's location, each piece of Client Equipment
covered by this Agreement. If Alpha Micro cannot repair a
piece of Client Equipment at the customer's location within
the agreed upon time frame, Alpha Micro will arrange to
replace the customer's piece of Client Equipment with a Client
Swap Unit. Alpha Micro will then attempt to repair the Client
Equipment removed from the customer's location at Alpha
Micro's facility. If the Client Equipment can be repaired,
Alpha Micro will use the repaired Client Equipment as a Client
Swap Unit. In the event Alpha Micro cannot repair a piece of
Client Equipment covered by this Agreement ("Non Serviceable
Client Equipment"), Alpha Micro shall notify Client. In such
event Client shall supply Alpha Micro with a replacement piece
of Client Equipment and Alpha Micro will return the Non
Serviceable Client Equipment to Client. If Client determines
that the Non Serviceable Client Equipment can be repaired,
Alpha Micro shall reimburse Client for the reasonable cost of
said repair, which for purposes of this Agreement shall be an
amount equal to the annual service fee for that piece of
equipment plus shipping costs for returning the Non
Serviceable Client Equipment and delivering the replacement
piece of equipment.
(d) Responsibility for Replacement of Alpha Micro Equipment That
Cannot Be Repaired.
Alpha Micro shall make every reasonable effort to repair, at
the customer's location, each piece of Alpha Micro Equipment
covered by this Agreement. If Alpha Micro cannot repair the
Alpha Micro Equipment at the customer's location within the
agreed upon time frame, Alpha Micro will arrange to replace
the customer's piece of Alpha Micro Equipment with an Alpha
Micro Swap Unit.
3. TECHNICAL SUPPORT.
Unless otherwise noted on Schedule "B", Client will provide
technical assistance to Alpha Micro's technical support personnel for the
products covered by this Agreement as may be reasonably requested by
Alpha Micro. When necessary, and as appropriate, Client will provide
Alpha Micro with all necessary manuals, technical documentation,
bulletins, diagnostics and other materials, for performance of remedial
and preventative maintenance ("Technical Data"). All Technical Data, and
all copies thereof, shall be subject to the provisions of Section 7
below, shall remain the property of Client and will be returned to Client
upon termination of this Agreement.
4. TRAINING.
When necessary, as appropriate, and unless otherwise set forth on
Schedule "B", Client will provide Alpha Micro with training to enable
Alpha Micro to perform the services contemplated pursuant to this
Agreement. Such training will occur in a manner, time and place mutually
agreed to by Client and Alpha Micro.
In the event that Client should terminate this Agreement prior to
Alpha Micro providing services on behalf of Client under this Agreement,
Client agrees to reimburse Alpha Micro training expenses at the rates
below but in no event shall said amount exceed $20,000.00:
$20.00 per hour per person for actual training time and two hours of
travel per person trained.
$70.00 per day per person trained for meals, lodging and travel
expense.
Number of Alpha Micro employees to be trained is 100.
5. FEES; TERMS OF PAYMENT.
Client shall pay to Alpha Micro for the services hereunder those
amounts set forth on Schedule "A". Alpha Micro will invoice for services
monthly, in advance. Invoices are due and payable within thirty (30)
days of issuance. Past due invoices are subject to an interest charge
equal to the lesser of one percent (1%) per month or the maximum rate
permitted by law. Charges listed on Schedule "A" do not include
applicable taxes. Applicable taxes, if any, shall be added to the
invoices and paid when due.
6. TERM.
This Agreement shall remain in effect for an initial period of two
(2) years from the date Alpha Micro first provides service to a Client
customer under this Agreement. This Agreement shall automatically renew
for additional one (1) year terms, unless either party gives notice to
the other of its intent not to renew. Alpha Micro shall give notice of
its intent not to renew six (6) months prior to the expiration of the
then current term and Client shall give notice of its intent not to renew
sixty (60) days prior to the expiration of the then current term.
Notwithstanding the foregoing, this Agreement may be terminated by
either party if the other party is in default of a material obligation
under this Agreement and said default has not been cured within thirty
(30) days after receipt of said notice. In the event Client has given
Alpha Micro two (2) prior notices that Alpha Micro was in default of its
obligation to provide service as required by this Agreement ("Service
Default"), Client shall be entitled to terminate this Agreement or delete
from this Agreement the customer involved with the Service Default
without affording Alpha Micro time to rectify a Service Default
subsequent to the two (2) initial Service Defaults.
7. PROPRIETARY INFORMATION.
In the course of performing services under this Agreement, and the
training which may take place hereunder, Alpha Micro may, from time to
time, be made aware of Client's confidential and/or proprietary
information ("Proprietary Information"), including, without limitation,
Client's products, customer lists, Technical Data, training techniques,
service techniques, and information regarding Client's business
operations. Alpha Micro will hold such Proprietary Information
confidential, will not employ same other than in fulfillment of the
purpose of this Agreement, will not disclose same to any persons other
than as necessary for Alpha Micro to discharge its duties under this
Agreement, and then only to such persons who have been advised of the
confidential nature of the information. The covenants hereunder shall
not apply to (i) information which was known to Alpha Micro prior to
receipt from Client; (ii) information which Alpha Micro receives from a
third party which has the right to convey such information; (iii)
information which is independently developed by Alpha Micro; or (iv)
information which becomes known to the public, if a breach of an
undertaking hereunder was not cause of such item becoming known to the
public.
8. NON-COMPETE.
During the term hereof and for an additional period of two (2) years
after the termination of this Agreement, Alpha Micro shall not, directly
or indirectly, for its own benefit or purposes, or for the benefit or
purposes of any other person or entity: (i) solicit or attempt to entice
away or employee any employee/consultant of Client; or (ii) solicit or
attempt to entice away or do business with any customer of Client for
whom Alpha Micro has provided services under this Agreement and/or was
introduced to by Client during the term of this Agreement ("Existing
Client Customer"). The foregoing restriction shall not prohibit Alpha
Micro from providing services to an Existing Client Customer in
connection with equipment other than (a) Client Equipment, (b) equipment
supplied by Client and used in connection with Client Equipment, or (c)
equipment serviced by Client and used in connection with Client
Equipment.
During the term hereof and for an additional period of two (2) years
after the termination of this Agreement, Client agrees that it shall not,
directly or indirectly, solicit or entice away or employee any
employee/consultant of Alpha Micro.
9. LIMITATION OF LIABILITY, INDEMNIFICATION AND INSURANCE.
(a) Except as otherwise provided herein, Alpha Micro shall not be
liable for loss of use of any of the items of equipment serviced
hereunder, or for any loss or damage occasioned by such loss of use, or
by any failure of any of the equipment to perform properly. Maintenance
service provided under this Agreement does not assure uninterrupted
operation of the equipment. In no event shall Alpha Micro be responsible
for any loss of data or information in connection with the servicing or
supporting of the equipment.
(b) In the event Alpha Micro is in breach of this Agreement, Alpha
Micro's liability for damages sustained by Client shall not exceed fifty
percent (50%) of the total annual maintenance fee provided for in this
Agreement at the time the breach occurred (e.g. if the total annual
maintenance fees at the time of a breach was $50,000, Alpha Micro's
maximum exposure for damages would be $25,000). The limitation of
damages shall not apply to a breach of Sections 7 and 8 of this Agreement
(c) Except as otherwise provided herein, ALPHA MICRO AND CLIENT
SHALL NOT BE LIABLE FOR LOSS OF PROFITS OR SAVINGS, OR ANY OTHER DIRECT,
INCIDENTAL OR CONSEQUENTIAL DAMAGES, EVEN IF THEY HAVE BEEN ADVISED OF
THE POSSIBILITY OF SUCH DAMAGE.
(d) Alpha Micro agrees to defend, hold harmless and indemnify
Client of, from and against any and all claims, liabilities, damages and
expenses (including reasonable attorneys' fees) for personal injury
and/or property damage caused by Alpha Micro or its agents or employees.
(e) Client agrees to defend, hold harmless and indemnify Alpha
Micro of, from and against any and all claims, liabilities, damages and
expenses (including reasonable attorneys' fees) for personal injury
and/or property damage caused by Client or its agents or employees.
(f) Alpha Micro, at its cost and expense, shall obtain and
maintain liability insurance for an amount of not less than $1,000,000.
The insurance policy shall designate Client as an additional named
insured. The policy shall state that the insurance company cannot cancel
or refuse to renew without at least 10 days written notice to Client.
Alpha Micro shall provide Client with evidence of the required insurance.
10. MISCELLANEOUS
(a) Relationship of Parties. Nothing contained in this
Agreement shall be construed as creating a joint venture, partnership or
employment relationship between the parties. Neither party shall have
any right or authority to create any obligation or duty, express or
implied, on behalf of the other.
(b) Entire Agreement. Except as mentioned in Section 10(p) below,
this Agreement, together with its Schedules incorporated by reference,
constitutes the entire understanding between the parties with respect to
the subject matter hereof, superseding all negotiations, prior
discussions and preliminary agreements. This Agreement may not be
changed except in writing executed by both parties.
(c) Assignment. This Agreement may be assigned by either party to
any wholly owned subsidiary and to any successor by merger, consolidation
or acquisition of a substantial part of its assets. Except as specified
hereinabove, this Agreement shall not be assigned, extended or otherwise
transferred in whole or in part, by either party, without the prior
written consent of the other party hereto, which consent shall not be
unreasonably withheld.
(d) Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
(e) Severability. If any term or provision of this Agreement,
or the application thereof to any person or circumstance, shall to any
extent be found to be invalid, void or unenforceable, such provision
shall be limited as necessary to render it valid and enforceable and the
remaining provisions and any application thereof shall continue in full
force and effect without being impaired or invalidated in any way.
(f) Notice. Except as otherwise expressly provided herein, any
notice herein required or permitted to be given shall be in writing and
shall be personally served (obtaining a signed receipt) or sent by
overnight courier, by registered mail or certified mail, postage prepaid
with a copy sent by fax and shall be deemed to have been given when such
writing is received by the intended recipient thereof. For the purposes
hereof, the addresses of each party hereto and their fax number (until
notice of a change thereof served as provided in this Section 10(f) shall
be as follows:
If to Alpha Micro: Alpha Microsystems
0000 X. Xxxxxxxx Xxxxxx
Xxxxx Xxx, Xxxxxxxxxx
Attn: President
Fax Number: 000-000-0000
If to Client: ATS Money Systems, Inc.
00 Xxxxxxxx Xxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: President
Fax Number: 000-000-0000
(g) Construction of Agreement. This Agreement shall be construed
in accordance with its plain meaning and not against either party as the
drafting party. Headings contained in this Agreement are for convenience
only and are not a part of this Agreement and do not in any way
interpret, limit or amplify the scope, extent or intent of this Agreement
or any of the provisions hereof.
(h) Governing Law. This Agreement shall be deemed to be a
contract under the laws of the state of New Jersey and for all purposes
shall be governed by and construed and enforced in accordance with the
internal laws (as opposed to conflicts of law provisions) of the State of
New Jersey.
(i) Waiver. No waiver of any term, provision or condition of
this Agreement, whether by conduct or otherwise, in any one or more
instances, shall be deemed to be or be construed as a further or
continuing waiver of any such term, provision or condition or as a waiver
of any other term, provision or condition of this Agreement.
(j) Force Majeure. Except for Client's obligation to make
payment hereunder, neither party shall be liable to the other for any
delay or inability to perform its obligations under this Agreement or
otherwise if such delay or inability arises from any act of God, fire,
natural disaster, act of government, or any other cause beyond the
reasonable control of such party ("Force Majeure Event"). If a Force
Majeure Event occurs, the party who cannot perform shall give immediate
notice to the other party and the notice shall include the reason for the
delay or inability to perform and the estimated length of the delay.
Furthermore, if a Force Majeure Event occurs that prevents Alpha Micro
from performing the service obligations as required by this Agreement and
the delay is estimated to last or actually lasts ten (10) business days
(if the Force Majeure Event is limited to only one (1) state the time
period shall be extended to twenty (20) days) Client shall have the
right to terminate this Agreement.
(k) Arbitration. Any dispute or controversy related to this
Agreement shall be submitted to JAMS/Endispute ("JAMS") for binding
arbitration by the complaining party providing written notice to JAMS and
the other party. The arbitration shall take place in a location mutually
agreed upon by the parties and, if they cannot agree upon a location, the
arbitration shall take place in Chicago, Illinois. The parties may agree
on a retired judge from the JAMS panel for the binding arbitration. If
they are unable to agree, JAMS will provide a list of three available
judges in close proximity to the location where the arbitration will take
place and each party may strike one. The remaining judge will serve as
the arbitrator. Judgment on the decision of the arbitrator may be
entered in the highest court of any forum, federal or state, having
jurisdiction. The cost for JAMS shall initially be shared equally by the
parties, with the prevailing party being entitled to recover its share of
said cost from the other party as provided for in Section 10(l). The
arbitrator shall set the guidelines for discovery.
(l) Attorneys' Fees and Costs. In the event of the bringing of
any proceeding, including under the provisions of Section 10(k), by a
party hereto against the other party by reason of a breach of any of the
covenants, conditions, agreements or provisions of this Agreement, the
prevailing party shall be entitled to recover from the other party costs
and expenses of suit or arbitration, including reasonable attorneys' fees
and the cost of JAMS.
(m) Further Actions. Each of the parties hereto agrees to take any
and all actions reasonably necessary in order to carry out the provisions
of this Agreement.
(n) Counterparts. This Agreement may be executed in one or more
counterparts and counterparts signed in the aggregate by the parties
shall constitute a single original instrument.
(o) Survival. Any termination, cancellation or expiration of this
Agreement notwithstanding, provisions of this Agreement and obligations
which are intended to survive and continue shall so survive and continue.
(p) Canadian Maintenance Agreement. Client and Alpha Micro are
parties to a Maintenance Agreement dated January 12, 1998 that pertains
to the servicing of products at Home Depot stores in Canada ("Canadian
Maintenance Agreement"). Upon the Effective Service Date for Home Depot
as reflected on Schedule "A", the Canadian Maintenance Agreement will be
deemed terminated and the products at the Home Depot stores in Canada
covered by the Canadian Maintenance Agreement will be included in this
Agreement.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date written above.
ALPHA MICROSYSTEMS ATS MONEY SYSTEMS, INC.
By:_____________________ By:_____________________
Its:____________________ Its:___________________
