AGREEMENT dated this 29 day of July, 1998
BY AND BETWEEN: MPACT IMMEDIA TRANSACTION SERVICES LTD., a legal person having
a place of business at Xxxxxxxxx Xxxxx, Xxxxxx Xxxxxx,
Xxxxxxxx, Xxxxxxx, herein represented by Xx. Xxxx Xxxxxxx,
duly authorised as he so declares,
(hereinafter referred to as "MPACT")
AND: Go Call Inc, a legal person having a place of business at 00
Xxxxx Xx. Xxxx, Xxxxxxxxx, Xxxxxxx, herein represented by
Xxxxxxx Xxxx, duly authorised as he so declares,
(hereinafter referred to as the "Client")
SECTION 1- PREAMBLE
1.1 WHEREAS the Client is desirous of engaging the services of MPACT to
process, verify, settle, confirm, report and perform value added
services on certain transactions relating to the business operations
of Client (the "Processing Services");
1.2 WHEREAS MPACT is desirous of providing the Processing Services to the
Client subject to the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
SECTION II - PROCESSING SERVICES
2.1 Subject to the terms and conditions set forth in this Agreement, MPACT
hereby agrees to provide the Processing Services to the Client.
Specifically, the Processing Services shall include the following:
2.1.1 real-time online authentication and approval of the credit
card information (namely, the card number and expiration
date) for each credit card transaction processed by the
Processing Services (the "Credit Card Transactions");
2.1.2 real-time online confirmation and approval that the relevant
card number accounts have sufficient credit available to
cover the amounts of the Credit Card Transactions;
2.1.3 settlements of the Credit Card Transactions that have been
approved based on positive credit card information, positive
credit availability and positive electronic mail verification
to the extent that same are used;
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2.1.4 the use of MPACT's electronic mail verification system and of
an address verification system for the purposes hereof and
the issuance of approvals based upon the electronic mail
response;
2.1.5 crediting back customers' cards upon electronic instructions
from the Client;
2.1.6 monthly written confirmations (on a calendar basis) to the
Client regarding the status of the Credit Card Transactions
including the total credit card deposits, returns,
Charge-Backs pending and Charge-Backs processed; and
2.1.7 daily reporting with respect to deposits and returns for the
preceding twenty-four (24) hours.
2.2 Nothing herein grants the Client any rights whatsoever in any of
MPACTs transaction or other software, and any use thereof by the
Client beyond the requirements of the Processing Services shall be
subject to separate agreement.
2.3 Each Friday of each calendar week, MPACT shall remit to the Client
the amount collected by MPACT in respect of Credit Card
Transactions processed, net of the credits identified in
subsection 2.1.5 above (the "Remittances"), subject to the
deductions, and reserves set forth in section III below.
SECTION III - FEES AND RESERVES
3.1 In consideration for Processing Services, the Client agrees to pay to
MPACT the following non-refundable fees:
3.1.1 six and three quarter percent (6.75%) of all approved and
settled Credit Card Transactions, subject to a minimum
monthly fee of four thousand dollars ($4,000);
3.1.2 Client shall pay an initial setup fee in the amount of two
thousand five hundred dollars ($2,500.00) upon execution of
this Agreement;
3.1.3 Client shall reimburse MPACT for all approved and settled
Credit Card Transactions which are at any time refused,
debited or charged back by the relevant bank or credit card
company for any reason whatsoever ("Charge-Backs");
3.1.4 Client shall pay a fee in the amount of ten dollars ($10.00)
plus any incremental fees and expenses charged or debited by
the banks or credit card companies for each Charge-Back; and
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3.2 Client hereby authorizes MPACT to deduct from the Remittances the
amounts owing under subsection 3.1 above. In the event that the
Remittances are insufficient to pay the amounts owing by the Client to
MPACT, the Client shall pay the balance thereof within seven (7)
business days following receipt of MPACTs written invoice for such
amount.
3.3 Client hereby further authorizes MPACT to deduct from the Remittances
and establish a reserve account (the "Reserve Account") to ensure
MPACTs recovery of any liabilities owed it or reasonably anticipated
to be owed to it by the Client pursuant to this Agreement including,
without limitation, all liabilities in respect of actual and/or
potential post-termination Charge-Backs, post-termination fees, and
charges, indemnifications and expenses due or anticipated to be due to
MPACT from Client. The Reserve Account shall be funded and/or
replenished by MPACTs withholding from the Remittances. The amount of
the Reserve Account shall be maintained in amounts consistent with the
provisions set forth in subsection 3.6 below.
3.4 As additional security for the payment of the obligations by the
Client, the Client agrees to provide MPACT with a security deposit
(the "Security Deposit") in the amount of fifty thousand dollars
($50,000.00). The Security Deposit shall be maintained at this amount
throughout the term of this Agreement and for a period of seven (7)
months thereafter, and the Client agrees to pay any deficiency into
the Security Deposit upon notice of such deficiency from MPACT. The
Security Deposit shall be made by the Client to MPACT upon the
execution of this Agreement.
3.5 As continuing and collateral security for the due and punctual payment
of any and all amounts now owing or which may hereafter become owing
to MPACT by the Client under this Agreement (the "Obligations"), as
same may be amended, renewed, extended or supplemented, the Client
hereby charges and hypothecates in favour of MPACT, with effect as of
and from this date, all right, title and interest of the Client in and
to the Remittances, Security Deposit and Reserve Account and all funds
therein comprised. The Client undertakes not to grant to any other
person any hypothecary or other security interest of equal or superior
rank to MPACT's in the Remittances, Security Deposit or Reserve
Account. The Client further undertakes, upon notice by MPACT and at
its expense, to execute and register such documents as may be
necessary or desirable to perfect MPACT's first-ranking security
interest therein.
3.6 During the initial six (6) month period of the term of this Agreement,
MPACT shall deduct fifteen percent (15%) from the Remittances to fund
the Reserve Account. Thereafter, MPACT shall continue to retain within
the Reserve Account the aggregate amount of fifteen percent (15%) of
the Remittances for the six (6) most recent months of the term of this
Agreement.
3.7 MPACT shall have the right to withdraw from the Reserve Account any
and all amounts owed to it hereunder upon one day's notice. MPACT
shall have the
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additional right to withdraw from the Security Deposit any and all
amounts owed to it hereunder should the Client fail to pay such
amounts within five business days of written default of payment notice
to the Client MPACT's rights to sums owed to it by Client pursuant to
this Agreement shall in no way be limited by the balance or existence
of the Reserve Account or the Security Deposit. MPACTs rights with
respect to the Reserve Account and the Security Deposit shall survive
the termination of this Agreement. It is understood that all interest
which may accrue with regards to the Reserve Account shall be for the
sole account of MPACT
3.8 All interest which may accrue in respect of the Security Deposit shall
be for the sole account of MPACT. Notwithstanding the forgoing, in the
event that MPACT terminates this Agreement without cause pursuant to
subsection 5.2 below, MPACT agrees that, as and from the date of such
termination, all interest which may accrue in respect of Security
Deposit shall be for the sole account of MPACT.
3.9 As amounts become payable to either party under this Agreement, and
unless otherwise agreed in writing, the party making the payment shall
do so by facilitating a wire transfer to a pre-designated account
stipulated by the other party. Payments shall be deemed to be made
upon the date of transfer from the transferor's bank.
3.10 The Client shall be responsible for the payment of any and all
applicable sales or other taxes due upon the Credit Card Transactions.
SECFION IV - INDEMNIFICATION AND LIMITATION OF LIABILITY
4.1 The Client shall jointly and severally defend and hold harmless MPACT
against and in respect to any and all claims, demands, losses, costs,
expenses, obligations, liabilities, damages, recoveries, and
deficiencies, including interest, penalties and reasonable attorney
fees that MPACT shall incur or suffer, that arise, result from, or
relate to any breach of or failure by the Client to perform any of its
representations, warranties, covenants or agreements in this Agreement
or in any schedule, supplemental agreement, appendix or other
instrument furnished or to be furnished to Client under this
Agreement.
4.2 MPACTs liability to Client with respect to any Credit Card Transaction
shall not exceed the amount represented by the transaction record in
connection with such Credit Card Transaction, less the applicable fees
payable to MPACT hereunder.
4.3 ALL WARRANTIES EXPRESSED OR IMPLIED INCLUDING, BUT NOT LIMITED TO,
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR
PURPOSE OF THE PROCESSING SERVICES OR OF ANY OTHER SERVICES PROVIDED
BY MPACT HEREUNDER ARE HEREBY DISCLAIMED BY MPACT, ITS AFFILIATES,
AGENTS AND LICENSORS. IN ADDITION, MPACT, ITS AFFILIATES, AGENTS AND
LICENSORS SHALL NOT BE LIABLE FOR ANY INCIDENTAL, CONSEQUENTIAL, OR
OTHER DAMAGES, LOSSES OR CLAIMS IN ANY WAY CONNECTED WITH OR ARISING
OUT OF THE USE OF THE PROCESSING SERVICES OR ANY OTHER SERVICES
PROVIDED BY MPACT HEREUNDER.
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4.4 MPACT, its affiliates, agents or licensors shall not be liable for any
loss resulting from erroneous statements or errors in transmission,
nor for any loss resulting from any delay, interruption or failure to
perform hereunder due to any circumstances beyond MPACTs reasonable
control including without limitation, acts of god, fire, explosion,
earthquake, riot, war, sabotage, accident, embargo, storms, strikes,
lockouts, any interruption, failure or defects in Internet, telephone,
or other interconnect services or in electronic or mechanical
equipment. MPACT's obligations hereunder shall be suspended during any
of the foregoing circumstances, which suspension shall not be a cause
for termination of this agreement by the Client.
SECTION V - TERM AND TERMINATION
5.1 This Agreement shall be effective commencing on the date first
mentioned above (the "Effective Date") until the first anniversary of
the Effective Date, and thereafter shall be renewed automatically for
additional consecutive three (3) month periods, unless earlier
terminated in accordance with the terms of subsections 5.2, 5.3 or 5.4
hereof.
5.2 Notwithstanding subsection 5.1, MPACT shall have the right to
terminate this Agreement immediately: (i) in the event of breach by
the Client of its representation, warranties or obligations under this
Agreement, or (ii) in the event that the Client is delinquent in any
payment hereunder ten (10) days after the same has become due. MPACT
may also terminate this Agreement with or without cause upon twenty
(20) business days' written notice to Client.
5.3 Notwithstanding subsection 5.1, Client may terminate this Agreement,
with or without cause, upon fifteen (15) business days written notice
to MPACT. Client's use of MPACT's services hereunder are completely at
will and non-exclusive.
5.4 Notwithstanding subsection 5.1, the parties agree that either of them
may, by notice to the other party, initiate negotiations on amendments
to this Agreement where such amendments would take effect on as of the
six (6) month anniversary of the Effective Date. In the event that
notice to negotiate has been given by a party hereunder, but the
parties have failed to reach agreement on amendments by such six (6)
month anniversary, this Agreement shall terminate on such six (6)
month anniversary.
5.5 Upon any termination of this Agreement, the Client shall immediately
discontinue the use of all of the Processing Services. All provisions
regarding indemnification, warranty, liability and limits thereon, and
confidentiality and/or protection of proprietary rights and trade
secrets shall survive indefinitely or until the expiration of any time
period specified elsewhere in this Agreement with respect to the
provision in question, and termination of this Agreement shall not
relieve the Client of its obligations to pay accrued fees.
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5.6 Upon any termination of this Agreement, MPACT shall be entitled to
retain as security for the payment of the Obligations each of the
Security Deposit and the Reserve Account for a period of seven (7)
months thereafter, save that the Reserve Account shall be reduced by
fifteen percent (15%) at the end of each month following termination,
and such amount shall be remitted to the Client net of any deductions
properly made hereunder during such month, until the whole of the
Reserve Account is Exhausted.
SECTION VI - REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE CLIENT
6.1 The Client hereby agrees to abide by the following good business
practices:
6.1.1 to offer for sale through its Web Site only products and
services that are available for delivery in the normal course
of the Client's business, based upon the type of product or
service being offered; and
6.1.2 to offer products or services for sale only if the Client has
legitimate rights to market and sell such products or
services.
6.2 The Client hereby represents and warrants to MPACT that throughout
the term of this Agreement:
6.2.1 it will maintain the value and reputation of MPACT to the
best of its reasonable ability;
6.2.2 it will conduct its business affairs in an ethical manner and
in accordance with the terms and intent of this Agreement,
and in compliance with all applicable government regulations;
6.2.3 it shall not use the Processing Services in connection with
any illegal or fraudulent business activities; and
6.2.4 it shall not permit or authorize any other person to use the
Processing Services.
6.3 The Client acknowledges to MPACT that they are independent contractors
and that nothing herein shall be construed as creating a joint venture
or partnership between them. For greater certainty, the Client
acknowledges that MPACT is not involved in the Client's business.
6.4 The Client agrees that at any time and from time to time during the
term of this Agreement, MPACT shall have the right to post a banner of
its design on the application/deposit page of website(s) incorporating
Processing Services, without any charge whatsoever to MPACT and in
addition to any other rights it may have hereunder.
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SECTION VII - GUARANTORS
7.1 As a primary inducement to MPACT to enter into this Agreement, (the
"Guarantors"), unconditionally and irrevocably, guarantee the
continuing full and faithful performance and payment by Client of each
of its duties and obligations to MPACT pursuant to this Agreement,
whether before or after termination or expiration and whether or not
any of the Guarantors has received notice of any amendment. If Client
breaches this Agreement, MPACT may proceed directly against any or all
of the Guarantors or any other persons or entity responsible for the
performance of this Agreement, without first exhausting its remedies
against any other person or entity responsible therefor to it or any
security held by MPACT.
SECTION VIII - AMENDMENTS
8.1 MPACT may amend this Agreement at any time by mailing written notice
to Client of any amendment at least thirty (30) days prior to the
effective date of the amendment, which amendment shall not (without
Client's written consent) modify or retroactively affect or apply to
fees, reserves or transactions occurring prior to the effective date
of the amendment. The amendment shall become effective on the date
specified by MPACT unless MPACT receives Client's notice of
termination of this Agreement before such effective date.
SECTION IX - NOTICES
9.1 Any notice, demand, request or other communication required or
permitted to be given under this Agreement shall be faxed (to MPACT
at____________ and to Client at ________________) delivered
personally, or sent to the other party by prepaid registered mail,
return receipt requested, at the addresses first hereinabove set out
or to such other address as either party may have previously indicated
to the other in writing in accordance with the foregoing. Any such
notice, request, demand or communication shall be deemed to have been
received on the day it was delivered personally, on the fifth (5th)
day following mailing, unless there is a disruption of any kind of
postal service in Canada, in which event all deliveries shall be made
personally or by fax, or on the business day after the date of a faxed
notice.
SECTION X - MISCELLANEOUS
10.1 This Agreement together with supplemental agreements, appendixes and
schedules constitutes the entire agreement between the parties
pertaining to the subject matter contained in it and supersedes all
prior and contemporaneous agreements, representations and
understandings of the parties. No waiver of any of the provisions in
this Agreement shall be deemed or shall constitute, a waiver of any
other provision, whether or not similar, nor shall any waiver
constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver.
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10.2 The Client may not assign this Agreement or any rights hereunder,
directly or by operation of law, without the prior written consent of
MPACT which consent may be withheld for any reason in MPACT's sole
discretion. For purposes of this Agreement assignment shall include,
but not be limited to, transfer of control of the Client and any
ownership change which results in a new majority owner.
10.3 The Client shall be liable for and shall indemnify and reimburse MPACT
for any and all attorneys' fees and other costs and expenses paid or
incurred by MPACT in the enforcement of this Agreement, or in
collecting any amounts due from the Client hereunder, or resulting
from any breach of any of the terms or conditions of this Agreement.
10.4 All remedies of either party hereunder are cumulative and may be
exercised concurrently or separately. The exercise of any one remedy
shall not be deemed to be an election of such remedy and shall not
preclude the exercise of any other remedy. No failure on the part of
either party to exercise and no delay in exercising any right or
remedy hereunder shall operate as a waiver of such right or remedy.
10.5 If any provision of this Agreement is held invalid or unenforceable by
any court of final jurisdiction, it is the intent of the parties that
all other provisions of this Agreement be construed to remain fully
valid, enforceable and binding on the parties.
10.6 The subject headings of the paragraphs and subparagraphs of this
Agreement are included for convenience only and shall not affect the
construction or interpretation of any of its provisions.
10.7 References to "this Agreement" include any supplementary agreements,
addendum, appendixes and amendments and any other agreements,
schedules appendixes and amendments promulgated by MPACT and furnished
to the Client from time to time.
10.8 All dollar amounts referred to in this Agreement are in United States
funds.
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IN WITNESS WHEREOF, the parties have signed as of the date first hereinabove
mentioned.
MPACT IMMEDIA TRANSACTION SERVICES LTD. Go Call Inc.
per: /s/ Xxxx Xxxxxxx per: /s/
------------------------- -------------------------
Xx. Xxxx Xxxxxxx
per: /s/
-------------------------
Guarantors:
per: /s/ per: /s/
------------------------- -------------------------
Go Call Inc. Go Call Inc.
