THIS MERCHANT SERVICES AGREEMENT (“Agreement”) is made among PASSAGE INC, a Delaware C-Corp, (formerly CORE LLC, a Michigan limited liability company) as the payment facilitator (“PF”) and the sole proprietor or business organization listed as the “Merchant” on the Service registration page (sometimes referred to as “you,” “your”, “user”).

  1. This Agreement sets forth, among other things, the terms and conditions under which PF will provide to Merchant services that facilitate Merchant’s acceptance of credit and debit Card payments for goods and services provided to Cardholders.
  2. PF is party to an agreement with VANTIV LLC (“Processor”) and FIFTH THIRD BANK (“Bank”) under which Processor and Bank provide payment processing and Association sponsorship services to PF on behalf of Merchant and other sub-merchants of PF.
  3. As a condition of providing services to PF on behalf of Merchant, the Associations, Bank and Processor require that PF include certain terms and conditions in this Agreement relating to the payment processing services being provided to Merchant.

NOW, THEREFORE, in consideration of the foregoing recitals and of the mutual promises hereinafter set forth, the parties agree as follows:

1.     Definitions.

For the purposes of this Agreement, the following terms shall have the meanings set forth below:

Account shall mean an open checking account at a financial institution acceptable to PF that PF or its agent can access through the ACH system.

Account Change means a change in the Account or the financial institution where the Account is located.

ACH shall mean the Federal Reserve’s Automated Clearing House (“ACH”) system.

Agreement means this Merchant Services Agreement, the Merchant Rules and Regulations, and each exhibit, schedule, and addendum attached hereto or referencing this Agreement, as well as all documents and other materials incorporated herein by reference.

Association means VISA, MasterCard, Discover, or any Other Network, as the same are defined herein.

Cards shall mean MasterCard, VISA, Discover and Other Network cards.

Cardholder shall mean any person authorized to use the Cards or the accounts established in connection with the Cards.

Data Incident shall mean any alleged or actual compromise, unauthorized access, disclosure, theft, or unauthorized use of Card or Cardholder information, regardless of cause, including without limitation, a breach of or intrusion into any system, or failure, malfunction, inadequacy, or error affecting any server, wherever located, or hardware or software of any system, through which Card information resides, passes through, and/or could have been compromised.

Debit Networks means those debit card networks accepted by Processor, which debit networks may be changed without notice.

Discover shall mean Discover Financial Services, LLC.

Event of Default shall mean each event listed in Section 13.

Float Event shall mean a circumstance where PF, for whatever reason, advances settlement or any amounts and/or delays the assessment of any fees.

Force Majeure Event shall mean errors in data provided by Merchant or others, labor disputes, fire, weather or other casualty, power outages, and funding delays, however caused, governmental orders or regulations, or any other cause, whether similar or dissimilar to the foregoing, beyond Bank’s reasonable control.

Initial Term shall mean 1 year from the 1st day of the calendar month following the later of the date PF executes this Agreement or the first date that all of Merchant’s locations receive the Services from PF.

Mark(s) means Visa, MasterCard and/or Discover trademarks.

Member Bank shall mean a member of VISA, MasterCard and/or Other Networks, as applicable, that provides sponsorship services in connection with this Agreement. As of the commencement of this Agreement, the Member Bank shall be Fifth Third Bank, an Ohio banking corporation.

Merchant Supplier shall mean a third party other than Bank used by Merchant in connection with the Services received hereunder, including but not limited to, Merchant’s software providers, equipment providers, and/or third party processors.

Laws shall mean all state and federal laws, rules, and regulations which govern or otherwise affect the activities of Merchant.

MasterCard shall mean MasterCard International, Inc.

Operating Regulations means the by-laws, operating regulations and/or all other rules, policies and procedures of VISA, MasterCard, Discover, and/or Other Networks as in effect from time to time.

Other Network shall mean any network or card association other than VISA, MasterCard, or Discover that is identified in the Merchant Price Schedule and in which Merchant participates hereunder.

PCI shall mean the Payment Card Industry Data Security Standard.

Rules shall mean the attached Merchant Rules and Regulations, which are incorporated into this Agreement by reference.

Sales Draft means the written form or electronic format supplied or approved by PF used in consummating each Card transaction.

Service shall mean any and all services described in, and provided by PF, Processor or Bank pursuant to, this Agreement.

VISA shall mean VISA USA, Inc.

2.     Rules; Operating Regulations; General Services Addendum. Merchant acknowledges receipt and review of the Rules, which are incorporated into this Agreement by reference. Merchant agrees to fully comply with all of the terms and obligations in the then current Rules, as changed or updated by PF from time to time, at PF’s sole reasonable discretion with notice in accordance with PF’s standard operating procedures. Merchant agrees to participate in the Associations in compliance with, and subject to, the Operating Regulations. Without limiting the foregoing, Merchant agrees that it will fully comply with any and all confidentiality and security requirements of the USA Patriot Act (or similar law, rule or regulation), VISA, MasterCard, Discover, and/or Other Networks, including but not limited to PCI, the VISA Cardholder Information Security Program, the MasterCard Site Data Protection Program, and any other program or requirement that may be published and/or mandated by the Associations. Should any Operating Regulation(s) not be publicly available or otherwise made available to the Merchant such unavailability shall not alter or limit Merchant’s obligation to comply with the Operating Regulations. Notwithstanding PF or Bank’s assistance in understanding the Operating Regulations, Merchant expressly acknowledges and agrees that it is assuming the risk of compliance with all provisions of the Operating Regulations, regardless of whether Merchant has possession of those provisions. Both MasterCard and VISA make excerpts of their respective Operating Regulations available on their internet sites Other Services applicable to this Agreement will be contained in the

3.     Application; Change in Business. Merchant represents that all information supplied by Merchant in connection with its application or other request for services is complete and accurate. In accordance with Section 326 of the USA Patriot Act, Bank is required to review and record information from the documents used in identifying new merchant customers. The preceding sentence is intended to inform Merchant of Bank’s procedures and of Bank’s responsibility under the USA Patriot Act. Merchant agrees to provide PF with 30 days prior written notice of Merchant’s intent to change its business form or entity in any manner (e.g., a change from a limited liability company to a corporation), and/or of Merchant’s intent to sell its stock or assets to another entity.

4.     Card Acceptance.   When accepting any Card and completing any Card transaction, Merchant shall follow all procedures and rules in the Rules and the Operating Regulations. In the event Bank for whatever reason is unable to obtain, or due to system delays chooses not to wait to obtain, authorization from an Association, Bank may at its option “stand-in” for such entities and authorize the sales transaction based on criteria established by Bank, and Merchant remains responsible for such sales transaction in accordance with this Agreement. Merchant has identified to PF the products and/or services for which it intends to accept Cards as payment. Merchant agrees that it shall only complete and deliver to PF sales transactions produced as the direct result of bona fide sales made by Merchant to Cardholders for such identified products and/or services, unless otherwise agreed by PF in writing

5.     Transaction Processing. PF will initiate payment to Merchant of the total face amount of each sales transaction acquired and accepted hereunder, subject to the terms and conditions of this Agreement, the Rules, the Operating Regulations, and applicable law, after PF receives payment for such sales transactions. Unless otherwise agreed to in writing by PF, Merchant shall electronically deliver to PF and in a format acceptable to PF all credit vouchers and sales transaction records within two (2) business days after the applicable transaction date (or such shorter period as determined by the applicable Association), except (i) in the case of a delayed merchandise delivery, when the sales transaction record shall be delivered within two (2) business days of the merchandise delivery or (ii) as specified otherwise in the Rules. Merchant agrees that it shall deliver sales transaction records to PF at least every business day. The preparation and delivery to PF by Merchant of sales transactions shall constitute an endorsement to PF by Merchant of each sales transaction, and Merchant authorizes PF or its representative to place Merchant’s endorsement on any sales transaction at any time. PF may refuse to acquire any sales transaction or claim the amount of which, in whole or in part, it could charge back to the Merchant pursuant to this Agreement, if it had acquired the sales transaction or claim. Merchant acknowledges and agrees that PF is not responsible for any action or inaction taken by the financial institution or other entity that issued the Card(s) to the Cardholder or the processor of such Card(s). Merchant agrees that PF may set off any amounts due to PF from amounts owed to Merchant, including but not limited to any amounts owed to Merchant from PF.

6.     Exception Items. Merchant agrees to reacquire and pay PF the amount of any sales transaction, and PF shall have the right at any time to charge Merchant’s Account therefore with notice in accordance with PF’s standard operating procedure, for any return (whether or not a credit voucher is delivered to PF), chargeback, compliance case, any other Association action, or if the extension of credit for merchandise sold or services or sales transactions performed was in violation of law or the rules or regulations of any governmental agency, federal, state, local or otherwise; or if PF has not received payment for any sales transaction, notwithstanding PF’s prior payment to Merchant for such sales transaction pursuant to Section 5 above or any other section. Not limiting the generality of the foregoing, Merchant agrees that any operational and/or other Services performed on behalf of Merchant, including but not limited to, production of facsimile drafts in response to copy requests, response to compliance cases, augmentation of Merchant data for interchange, transaction stand-in, digital draft storage and retrieval, etc. shall in no way affect Merchant’s obligations and liability in this Agreement including those in the foregoing sentence. Merchant may instruct PF in the defense of chargebacks, compliance cases and similar actions, and Merchant agrees that it will promptly provide any such instructions to PF.

7.     Merchant Suppliers. Merchant may use one or more Merchant Suppliers in connection with the Services and/or the processing of some or all of its Card transactions. In no event shall Merchant use a Merchant Supplier unless such Merchant Supplier is compliant with PCI and/or the Payment Application Data Security Standard (“PA-DSS”), depending on the type of Merchant Supplier, as required by the Operating Regulations. Merchant acknowledges and agrees that Merchant shall cause its Merchant Supplier to complete any steps or certifications required by any Association (e.g., registrations, PA-DSS, PCI, audits, etc.). Merchant shall cause its Merchant Supplier to cooperate with PF in completing any such steps or certifications (if applicable), and in performing any necessary due diligence on such Merchant Supplier. Merchant shall be solely responsible for any and all applicable fees, costs, expenses and liabilities associated with such steps, registrations, and certifications. Merchant shall bear all risk and responsibility for conducting Merchant’s own due diligence regarding the fitness of any Merchant Supplier(s) for a particular purpose and for determining the extent of such Merchant Supplier’s compliance with the Rules, the Operating Regulations, and applicable law. Merchant expressly agrees that PF shall in no event be liable to Merchant or any third party for any actions or inactions of any Merchant Supplier used by Merchant, even if PF introduced and/or recommended the use of such Merchant Supplier to Merchant, or never objected to the use of such Merchant Supplier, and Merchant hereby expressly assumes all such liability.

8.     Cardholder Information. Merchant shall not disclose, sell, purchase, provide, or exchange Cardholder name, address, account number or other information to any third party other than to Bank or an Association for the purpose of completing a sales transaction unless specifically permitted by the Operating Regulations. Merchant represents and warrants that neither it nor its Merchant Supplier shall retain or store any portion of the magnetic-stripe data subsequent to the authorization of a sales transaction, nor any other data prohibited by the Operating Regulations, the Rules, and/or this Agreement.

9.     Term. The term of this Agreement shall commence the date PF executes this Agreement, and shall continue for the Initial Term as defined in Section 1 of this Agreement. Except as hereafter provided, unless either party gives written notice to the other party at least 90 days prior to the expiration of any term, the Agreement including all addenda, schedules and exhibits hereto or referencing this Agreement shall be automatically extended for additional periods equal to the Initial Term. All obligations of Merchant incurred or existing under this Agreement as of the date of termination, shall survive such termination. This Agreement will automatically terminate if an Association de-registers PF or if Bank ceases to be a customer of an Association or fails to have a valid license with an Association to use any Mark accepted by Merchant.

10.   PF Fees. Merchant agrees to pay PF the fees, expenses and all other amounts set forth in the Agreement including, but not limited to, the fees set forth on the Merchant Application. PF may change or add fees and/or charges upon notice to Merchant in accordance with PF’s standard operating procedure, and such fees and/or charges shall be immediately payable by Merchant when assessed by PF. In the event PF changes or adds its fees and/or charges pursuant to the immediately preceding sentence (“Fee Change”), Merchant may, subject to the following provisions, terminate the Agreement upon 60 days advance written notice to PF provided PF receives such written notice from Merchant of its intention to so terminate within 90 days of the date the Fee Change becomes effective. Upon PF’s receipt of Merchant’s written notice pursuant to the immediately preceding sentence, PF shall have 30 days to rescind or waive the Fee Change, and, in the event PF elects to rescind or waive the Fee Change, Merchant shall not have the right to terminate this Agreement as a result of the Fee Change and this Agreement shall remain in full force and effect notwithstanding Merchant’s written notice to terminate. Merchant acknowledges and agrees that this Section shall not be intended or construed to permit Merchant to terminate the Agreement as a result of a change or increase in fees from third parties and/or in pass through fees as referenced in this Agreement or the Merchant Price Schedule.

11.   Third Party Assessments. Notwithstanding any other provision of this Agreement, Merchant shall be responsible for all amounts imposed or assessed to Merchant and/or PF in connection with this agreement by third parties such as, but not limited to, Processor, Bank, VISA, MasterCard, Discover, Other Networks, and Merchant Suppliers (including telecommunication companies). Such amounts include, but are not limited to, fees, fines, assessments, penalties, loss allocations, etc. Any changes or increases in such amounts shall automatically become effective upon notice to Merchant in accordance with PF’s standard operating procedure and shall be immediately payable by Merchant when assessed by PF. In the event of a Float Event, PF reserves the right to assess to Merchant, and Merchant shall pay to PF, a cost of funds associated with the Float Event (which PF may at its option assess as a transaction surcharge), the amount of which shall be determined by PF in its reasonable discretion, and which may be changed by PF from time to time, and such cost of funds shall be effective as of the start of the Float Event and shall be immediately payable by Merchant when assessed by PF.

12.   Non-Exclusivity. PF reserves the right to enter into other agreements pertaining to the Services with others including without limitation other merchants. The parties agree that PF shall be the non-exclusive provider of the Services to Merchant at all of its locations and websites.

13.   Default. The following events shall be considered an “Event of Default”:

(i) 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 its inability to pay its debts as they become due; or

(ii) Merchant fails to pay or reimburse the fees, expenses or charges referenced herein when they become due; or

(iii) Merchant is in default of any terms or conditions of this Agreement whether by reason of its own action or inaction or that of another; or

(iv) PF or Bank reasonably believe that there has been a material deterioration in Merchant’s financial condition; or

(v) any standby letter of credit, if and as may be required pursuant to Section 20, will be cancelled, will not be renewed, or is not in full force and effect; or

(vi) Merchant ceases to do business as a going concern, or there is a change in ownership of Merchant which changes the identity of any person or entity having, directly or indirectly, more than 30% of either the legal or beneficial ownership of Merchant.

Upon the occurrence of an Event of Default, PF may at any time thereafter terminate this Agreement by giving Merchant written notice thereof. Termination of Merchant for any reason shall not relieve Merchant from any liability or obligation to PF. If, prior to the date on which the then current term of this Agreement is scheduled to expire, either this Agreement is terminated by PF as specifically permitted by this Agreement, or Merchant for any reason discontinues receiving the Services from PF (except as may be specifically permitted by this Agreement), Merchant shall be liable to PF for liquidated damages in an amount equal to the average monthly revenue payable to PF as a result of this Agreement for the three calendar months in which such revenue was the highest during the preceding 12 calendar months, or such shorter period if this Agreement has not been in effect for 12 months, multiplied by the number of months remaining during the then current term of this Agreement. Merchant recognizes and agrees that the liquidated damages are fair and reasonable because it is not possible to establish the actual increase in volume and activity by Merchant during the term of this Agreement. Merchant shall also reimburse PF for any damage, loss or expense incurred by PF as a result of a breach by Merchant, including any damages set forth in any addendum and/or schedule and/or exhibit hereto and including all past due, unpaid and/or future invoices for services rendered by PF in connection with this Agreement. All such amounts shall be due and payable by Merchant upon demand. Bank shall also have the option to require Merchant to reacquire all outstanding sales transactions acquired by Bank hereunder. PF may refuse to provide the Services in the event it has not been paid for the Services as provided herein.

14.   Nonperformance: In the event Merchant, in good faith, reasonably believes that PF has substantially failed to provide the Services, other than as a result of a failure by Merchant (or any Merchant Supplier, or other third party acting at the request of or on behalf of Merchant) to perform any obligation under the Agreement or any Force Majeure Event, Merchant agrees to notify PF in writing within 5 days of the date upon which such failure first occurred. Merchant agrees that such notice shall be sent in accordance with the terms of this Agreement, and shall specifically describe the nature of such failure by PF, specify the date such failure first occurred and specifically reference this section.

PF will attempt to resolve such failure within 60 days of PF’s actual receipt of such notice from Merchant. Should PF not resolve such failure within the cure period described in the foregoing sentence, Merchant may terminate this Agreement upon 90 days prior written notice to PF, provided PF actually receives such notice of termination within 30 days after the end of such cure period.

15.   Taxes. Any sales, use, excise or other taxes (other than PF’s income taxes) payable in connection with or attributable to the Services provided to the Merchant per this Agreement shall be paid by Merchant. PF may, but shall not have the obligation to, pay such taxes In the event PF pays such taxes, Merchant shall immediately reimburse PF or PF may, at PF’s sole option, charge Merchant’s Account.

16.   Binding on Successors; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, administrators, successors, transferees and assignees. Neither this Agreement nor any interest herein may directly or indirectly be transferred or assigned by Merchant, in whole or in part, without the prior written consent of PF, which will not be unreasonably delayed or withheld. Merchant will remain liable for any amounts owed under this Agreement after an unauthorized transfer or assignment by Merchant, even if PF continues to provide Services to such transferee or assignee. This Agreement is for the benefit of, and may be enforced only by, PF and Merchant and their respective successors and permitted transferees and assignees, and is not for the benefit of, and may not be enforced by, any third party.

17.   Notices. All notices, requests, demands and other communications to be delivered hereunder unless specified otherwise herein shall be in writing and shall be delivered by nationally recognized overnight carrier, registered or certified mail, postage prepaid, to the following addresses:

(i)             if to PF: 615 Griswold St, Ste 210, Detroit, MI 48226

Attention: Passage Inc Legal Department;

(ii)            if to Merchant: to the Merchant address provided above, Attention President/Owner; or to such other address or to such other person as either party shall have last designated by written notice to the other party.

Notices, etc., so delivered shall be deemed given upon receipt. Merchant must promptly provide PF with any change of address.

18.   Unenforceable Provision. If any term or provision of this Agreement or any application thereof shall be invalid or unenforceable, the remainder of this Agreement and any other application of such term or provision shall not be affected thereby.

19.   Payment. Merchant shall always maintain an open Account. Merchant irrevocably authorizes PF to debit and/or credit the Account to settle any and all fees and other amounts due PF under this Agreement, and such authority shall remain in effect for a period of one (1) calendar year following the date of termination of this Agreement, regardless of whether Merchant has notified PF of an Account Change as defined below. Merchant shall always maintain the Account with sufficient cleared funds to meet its obligations under this Agreement. In the event Merchant desires an Account Change, Merchant shall give PF 30 days prior written notice in accordance with the provisions of Section 17 of any such change, and PF shall use reasonable commercial efforts to effect such Account Change; however, such Account Change shall not be effective until the date on which PF actually makes such Account Change on PF’s system. In no event shall PF have any liability for any amounts directed to an Account that has been designated by any purported representative of Merchant or its Merchant Supplier at any time during the term of this Agreement, regardless of any Account Change. All amounts due PF under this Agreement shall be paid without set-off or deduction, and shall be due from Merchant as of the date Bank originates an ACH debit transaction record to PF’s Account. Any fees not collected from Merchant by PF when due shall bear interest at one (1) percentage point per month but in no event more than the highest rate permitted by law. The acceptance by PF of Merchant’s closing (or termination of) its Account shall not constitute a mutually agreed upon termination of this Agreement.

  1. Reserve; Letter of Credit. As a specifically bargained for inducement for PF to enter into this Agreement with Merchant, PF at its option reserves the right to i) establish from amounts payable to Merchant hereunder, and/or cause Merchant to pay to PF, a reserve of funds satisfactory to PF to cover anticipated fees, chargebacks, returns and any other applicable assessments and/or ii) require Merchant to establish an irrevocable standby letter of credit, including additional and/or replacement letters of credit if required by PF, with a beneficiary designated by PF, in a format, with an expiration date, and in an amount acceptable to PF in its sole discretion. In the event Merchant fails to establish, for any reason whatsoever, a reserve and/or a letter of credit as required above, PF shall have all of the rights and remedies available to PF in this Agreement, including but not limited to exercising the rights and remedies of PF in Section 13. In the event PF exercises its right to establish a reserve or require a letter of credit pursuant to this Section, Merchant may, subject to the following provisions, terminate the Agreement upon 30 days advance written notice to PF provided PF receives such written notice from Merchant of its intention to so terminate within 90 days of the date on which PF establishes the reserve or requires the letter of credit. Upon PF’s receipt of Merchant’s written notice pursuant to the immediately preceding sentence, PF may, at its option, return the reserve to Merchant or waive the requirement for a letter of credit, and, in the event PF elects to return the reserve to Merchant or waive the requirement for a letter of credit, Merchant shall not have the right to terminate this Agreement pursuant to this Section and this Agreement shall remain in full force and effect notwithstanding Merchant’s written notice to terminate.

21.   Right of First Refusal. Should Merchant give notice of termination or non-renewal to PF at any time, Merchant warrants that before entering into any agreement with any third party for the Services provided to Merchant by PF as specified in this Agreement, PF shall have the right of first refusal of entering into agreements with Merchant for all such Services under the same terms and conditions (except for the length of the term, which shall not be less than the length of the Initial Term of this Agreement) in lieu of Merchant entering into such agreement with a third party.

22.   Indemnification. Subject to the other limitations, terms and conditions of this Agreement, PF shall indemnify, defend, and hold harmless Merchant, and its directors, officers, employees, affiliates and agents from and against all third party proceedings, claims, losses, damages, demands, liabilities and expenses whatsoever, including all reasonable legal and accounting fees and expenses and all reasonable collection costs, incurred by Merchant, its directors, officers, employees, affiliates and agents to the extent resulting from or arising out of PF’s gross negligence, or willful misconduct. Merchant shall indemnify, defend, and hold harmless PF, and its directors, officers, employees, affiliates and agents from and against all proceedings, claims, losses, damages, demands, liabilities and expenses whatsoever, including all reasonable legal and accounting fees and expenses and all reasonable collection costs, incurred by PF, its directors, officers, employees, affiliates and agents resulting from or arising out of the Services in this Agreement, Merchant’s processing activities, the business of Merchant or its customers, any sales transaction submitted to PF, any noncompliance with the Rules and/or the Operating Regulations (or any rules or regulations promulgated by or in conjunction with the Associations) by Merchant or its agent (including any Merchant Supplier), any violation of a third party’s intellectual property rights by Merchant, any Data Incident, any infiltration, hack, breach, or violation of the processing system of Merchant, its Merchant Supplier, or any other third party processor or system, or by reason of any breach or nonperformance of any provision of this Agreement on the part of the Merchant, or its employees, agents, Merchant Suppliers, or customers. The indemnification of each party shall survive the termination of the Agreement.

23.   Review of Settlement Activity and Reports. Merchant agrees that it shall review all reports, notices, and invoices prepared by PF or its agent and made available to Merchant including but not limited to reports, notices, and invoices provided by PF. PF reserves the right to send some or all of the reports and/or invoices and/or notices of any pricing changes permitted under this Agreement via electronic transmission (e.g., via e-mail) which PF may change from time to time upon notice to Merchant in accordance with PF’s standard operating procedure. Merchant expressly agrees that Merchant’s failure to notify PF that Merchant has not received its funds within five business days from the date that receipt of such funds was due to occur, or fails to reject any report, notice, or invoice within thirty business days from the date the report or invoice is made available to Merchant, shall constitute Merchant’s acceptance of the same.

24.   Choice of Law; Jurisdiction; Venue. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Michigan without regard to conflicts of law provisions. The parties hereby consent and submit to service of process, personal jurisdiction, and venue in the state and federal courts in Detroit, Michigan or Wayne County, Michigan, and select such courts as the exclusive forum with respect to any action or proceeding arising out of or in any way relating to this Agreement, and/or pertaining in any way to the relationship between Merchant and PF. MERCHANT AND PF HEREBY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY MATTER UNDER, RELATED TO, OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTIONS OR RELATIONSHIPS CONTEMPLATED HEREBY.

25.   Limit of Liability; Force Majeure. EXCEPT FOR THOSE EXPRESS WARRANTIES MADE IN THIS AGREEMENT, PF DISCLAIMS ALL WARRANTIES, INCLUDING, WITHOUT LIMITATION, ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. MERCHANT HEREBY ACKNOWLEDGES THAT THERE ARE RISKS ASSOCIATED WITH THE ACCEPTANCE OF CARDS AND MERCHANT HEREBY ASSUMES ALL SUCH RISKS EXCEPT AS MAY BE EXPRESSLY SET FORTH HEREIN. Without limiting the foregoing, PF shall not be liable for lost profits, lost business or any incidental, special, consequential or punitive damages (whether or not arising out of circumstances known or foreseeable by PF) suffered by Merchant, its customers or any third party in connection with the Services provided hereunder. In no event shall PF be liable for any damages or losses that are wholly or partially caused by the Merchant, or its employees, agents, or Merchant Suppliers that should have been reported to PF pursuant to Section 23, or that first occurred, whether or not discovered by Merchant, more than 30 days prior to PF’s receipt of written notice from Merchant. PF’s liability related to or arising out of this Agreement shall in no event exceed an amount equal to the lesser of (i) actual monetary damages incurred by Merchant or (ii) fees paid to and retained by PF for the particular Services in question for the three calendar months immediately preceding the date on which PF received a written notice from Merchant detailing PF’s material nonperformance under this Agreement. PF shall not be deemed to be in default under this Agreement or liable for any delay or loss in the performance, failure to perform, or interruption of any Services resulting, directly or indirectly, from a Force Majeure Event. Upon such an occurrence, performance by PF shall be excused until the cause for the delay has been removed and PF has had a reasonable time to again provide the Services. No cause of action, regardless of form, shall be brought by either party more than 1 year after the cause of action arose, other than one for the nonpayment of fees and amounts due PF under this Agreement.

26.   Controlling Documents. This Agreement (including all addenda and schedules and exhibits hereto and all documents and materials referenced herein) supersedes any and all other agreements, oral or written, between the parties hereto with respect to the subject matter hereof, and sets forth the complete and exclusive agreement between the parties with respect to the Services and, unless specifically provided for herein, other services are not included as part of this Agreement. If there is a conflict between the Merchant Services Agreement and an addendum or schedule or exhibit hereto, the addendum or schedule or exhibit shall control. If there is a conflict between the Rules and this Agreement, the Rules shall prevail. If there is a conflict between Operating Regulations and this Agreement, the Operating Regulations shall prevail. If there is a conflict between the Operating Regulations and the Rules, the Operating Regulations shall prevail.

27.   PF’s Right to Suspend or Cease Services. PF may suspend or cease providing any Service in this Agreement if , in PF’s reasonable opinion (i) such Service, violates or would violate the Operating Regulations, Rules, or any federal, state or local statute or ordinance or any regulation, order or directive of any governmental agency or court and/or (ii) if Merchant is accused by any federal, state or local jurisdiction of a violation of any applicable statute or ordinance or any regulation, order or directive of any governmental agency or court, or if PF reasonably believes, based upon the opinion of its legal counsel, that Merchant is in violation of any of the foregoing. Should Merchant not process sales transactions through PF’s system for a period of one year or more, PF may remove Merchant from PF’s systems without notice, without relieving Merchant from any of Merchant’s obligations under this Agreement.

28.   Conversion; Deconversion. Merchant shall take all necessary steps to, and shall, promptly convert to PF’s system for the Services in this Agreement not later than 90 days after the execution of this Agreement by PF. PF agrees that it shall not charge Merchant for PF’s standard and customary internal testing and conversion preparation only, in connection with Merchant’s initial conversion to PF’s system at the commencement of this Agreement, and as determined by PF in its sole reasonable discretion. The foregoing shall not be deemed to limit Merchant’s obligation to pay any third party fees and expenses incurred by PF in connection with Merchant’s conversion, which shall remain the sole responsibility of Merchant. Merchant agrees to be responsible for all direct and indirect costs (including but not limited to those incurred by PF, its affiliates and/or agents) in connection with and/or related to Merchant’s conversion from PF at the termination of this Agreement and/or related to any conversion or programming effort affecting the Services after Merchant’s initial conversion to PF.

  1.    Confidential Information.

(a)   Confidential Information Supplied by PF. Merchant acknowledges that PF will be providing Merchant with certain confidential information, including but not limited to, this Agreement and information relating to the finances, systems, methods, techniques, programs, devices and operations of PF and/or the Associations. Merchant shall not disclose any such confidential information to any person or entity (other than to those employees and Merchant Suppliers of Merchant who participate directly in the performance of this Agreement and need access to such information). Without limiting the foregoing, Merchant agrees that it will fully comply with any and all confidentiality and security requirements of the USA Patriot Act (or similar law, rule or regulation), Bank, VISA, MasterCard, Discover, and/or Other Networks.

(b)   Confidential Information Supplied by Merchant. PF acknowledges that Merchant will be providing PF with certain confidential information, including information relating to the methods, techniques, programs, devices and operations of Merchant. PF will not disclose confidential and proprietary information about Merchant to any person or entity (other than to those employees and agents of PF who participate directly in the performance of this Agreement and need access to such information). Merchant acknowledges receipt of PF’s privacy notice (“Privacy Notice”). Merchant should direct any questions or requests for another copy of the Privacy Notice to PF. Notwithstanding anything to the contrary in the Privacy Notice or this Agreement, PF may share any information provided by Merchant and/or relevant to the Services received by Merchant: (a) with Merchant’s franchisor, Merchant’s franchisee(s), association(s) to which Merchant belongs and/or belonged as of the commencement of this Agreement, (b) any affiliate of Merchant; (c) in response to subpoenas, warrants, court orders or other legal processes; (d) in response to requests from law enforcement agencies or government entities; (e) to comply with applicable Laws; and/or (f) in the proper performance of the Services contemplated herein.

(c)   Miscellaneous. The parties acknowledge that the injury that would be sustained by the party disclosing information as a result of the violation of this Section 29 cannot be compensated solely by money damages, and therefore agrees that the disclosing party shall be entitled to seek injunctive relief and any other remedies as may be available at law or in equity in the event of a violation of the provisions contained in this Section 29. The restrictions contained in this Section 29 shall not apply to any information which becomes a matter of public knowledge, other than through a violation of this Agreement or other agreements between the parties.

(d)   Publicity. Merchant acknowledges and agrees that PF may make public the execution of this Agreement by Merchant and/or any of Merchant’s affiliates, and/or the Services that may be or have been provided under the Agreement. Merchant agrees that PF may include Merchant’s name and logo on a list of PF’s customers, which may be made public. Merchant agrees that, upon PF’s request, Merchant will provide testimonial information related to the Services received by Merchant hereunder.

30.   Financial Statements. Merchant shall provide PF with an audited financial statement for Merchant’s most recent fiscal year end and/or quarterly financial statements prepared and certified by Merchant’s chief financial officer within 15 days of PF’s request therefore.

31.   No Waiver. If either party waives in writing an unsatisfied condition, representation, warranty, undertaking or agreement (or portion thereof) set forth herein, the waiving party shall thereafter be barred from recovering, and thereafter shall not seek to recover, any damages, claims, losses, liabilities or expenses, including, without limitation, legal and other expenses, from the other party in respect of the matter or matters so waived. Except as otherwise specifically provided for in this Agreement, the failure of any party to promptly enforce its rights herein shall not be construed to be a waiver of such rights unless agreed to in writing. Any rights and remedies specifically provided for in any addendum or schedule or exhibit are in addition to those rights and remedies set forth in this Agreement and/or available to PF at law or in equity.

32.   Compliance with Law. Merchant represents and warrants to PF that it will comply with all applicable Laws in connection with Merchant’s receipt of the Services and/or applicable to Merchant’s business operations.

33.   Security, Data Incidents. Merchant will be solely responsible for the security, quality, accuracy, and adequacy of all transactions and information supplied hereunder, and will establish and maintain adequate audit controls to monitor the security, quality, maintenance, and delivery of such data. Without limiting the generality of the foregoing, Merchant warrants to PF that it has implemented and will maintain secure systems for maintaining and processing information and for transmitting information to PF. PF shall have no liability whatsoever for the security or availability of any communications connection used in connection with the Services provided hereunder. Merchant acknowledges that PF is responsible only for the security of its own proprietary systems, and not for the systems of any third party, including without limitation any Merchant Supplier of Merchant. Merchant shall notify PF immediately if Merchant becomes aware of or suspects a Data Incident. Merchant agrees to fully cooperate with PF, Bank and any Association with respect to any investigation and/or additional requirements related to a suspected Data Incident.

34.   Audits. At any reasonable time upon reasonable notice to Merchant, Merchant shall allow auditors, including the auditors of any Association or any third party designated by PF, Bank, or the applicable Association, to review the files held and the procedures followed by Merchant at any or all of Merchant’s offices or places of business. PF agrees that should it conduct an audit which is not required by the Operating Regulations or is not requested by Bank or an Association, such audit will be at PF’s sole expense; otherwise the audit shall be at Merchant’s expense. Merchant will assist such auditors as may be necessary for them to complete their audit. In the event that a third-party audit is requested by an Association, and/or required by the Operating Regulations, PF may, at its option, and at Merchant’s sole expense, either retain a third party to perform the audit, or require that Merchant directly retain a specific third party auditor. If PF requires that Merchant directly retain the auditor, Merchant shall arrange immediately for such audit to be performed, and will provide PF and the Associations with a copy of any final audit report.

35.   System Requirements and Upgrades. Merchant agrees that the Services shall be provided in accordance with PF’s then current systems, standards and procedures and that PF shall not be required to perform any special programming, to provide any special hardware or software or to implement any other system, program or procedure for Merchant. Unless otherwise agreed in writing by PF, all sales transaction, settlement and other data and information used in connection with the Services shall be provided to PF in PF’s then current data formats and by means of PF’s then current telecommunications configurations and protocols. PF may make changes in the Services based upon, but not limited to, technological developments, legislative or regulatory changes, or the introduction of new services by PF. Merchant shall comply with all time deadlines, equipment and software maintenance and upgrading requirements which PF may reasonably impose on Merchant from time to time.

36.   Title to the Services. Merchant agrees it is acquiring only a nontransferable, non‑exclusive right to use the Services. PF shall at all times retain exclusive title to the Services, including without limitation, any materials delivered to Merchant hereunder and any invention, development, product, trade name, trademark, service mark, software program, or derivative thereof, developed in connection with providing the Services or during the term of this Agreement.

37.   Merchant Application Information. Merchant represents and warrants to PF that all information in the Merchant Application is correct and complete. Merchant must notify PF in writing of any changes to the information in the Merchant Application, including but not limited to: (a) any additional location or new business; (b) the identity of principals and owners; (c) the form of business organization; (d) the type of goods and services provided; and (e) how sales are completed (e.g., by telephone, mail, or in person at Merchant’s place of business). The notice must be received by PF within 10 days of the change and Merchant is liable to PF for all losses and expenses incurred by PF arising out of Merchant’s failure to provide such timely notice.

38.   Limited Acceptance.If so indicated below, Merchant acknowledges and agrees that it wishes to be a Limited Acceptance merchant, which means that Merchant has elected to accept only certain VISA/MasterCard card types as indicated below, or via later notification. Merchant further acknowledges and agrees that PF has no obligation other than those expressly provided under the Operating Regulations and applicable law as they may relate to limited acceptance and that PF’s obligations do not include policing card types at the point of sale. As a Limited Acceptance Merchant, Merchant will be solely responsible for the implementation of its decision for Limited Acceptance. Merchant will be solely responsible for policing, at the point of sale, the card type(s) of transactions it submits for processing by PF. Should Merchant submit a transaction for processing for a card type it has indicated it does not wish to accept, PF may process that transaction and Merchant will pay the applicable fees, charges, and assessments associated with that transaction. For Merchant’s convenience, a general description of VISA/MasterCard card types are:

a.        Consumer Credit – a consumer credit card issued by a U.S. Issuer or a commercial credit card issued by a non-U.S. Issuer; this category does not include VISA or MasterCard branded signature-based debit cards.

b.        Consumer Debit – a VISA or MasterCard branded signature-based debit card (including certain stored-value and prepaid cards).

c.        Commercial – a VISA or MasterCard branded credit card issued by a U.S. Issuer that bears the descriptive term “Business Card”, “Corporate Card”, “Purchasing Card”, “Fleet Card”, or similar descriptive term indicated pursuant to the Operating Regulations.

Only if checked below, Merchant wishes to be a Limited Acceptance Merchant, which means that Merchant will accept only the VISA/MASTERCARD card types indicated below:

 VISA Credit Cards

 VISA Debit Cards (signature based)

 MasterCard Credit

 MasterCard Debit Cards (signature based)

39.   Security Interest. This Agreement will constitute a security agreement under the Uniform Commercial Code. Merchant grants to PF a security interest in all Merchant’s bank accounts and the Reserve Account, and the proceeds thereof (the “Secured Assets”), to secure all of Merchant’s obligations under this Agreement.  With respect to such security interest, PF will have all rights afforded under the Uniform Commercial Code, any other applicable law, and in equity. In addition to the security interest in the Secured Assets, PF shall have a contractual right of setoff against the Secured Assets.

Every such right of setoff shall be deemed to have been exercised immediately upon the occurrence of an Event of Default hereunder without any action by PF or notation in the PF’s records, although PF may enter such set off on its books and records at a later time.  Merchant warrants and represents that no other person or entity has a security interest in the Secured Assets. If a bankruptcy proceeding is filed by or against Merchant under the Bankruptcy Code (whether the petition is filed voluntarily and/or involuntarily), it waives any applicable protection related to the automatic stay provisions of 11 U.S.C. §362 (or any replacement section) and consents to an appropriate reserve of funds being established between the parties pursuant to this Agreement or by Court Order.

40.   Modification of Agreement. Except as provided in this Agreement, this Agreement including any addendum or schedule or exhibit hereto shall only be modified or amended by an instrument in writing signed by each party hereto. Any changes, additions, stipulations or deletions, including lining out, by Merchant, except where indicated by a space to be filled in (e.g., the space for Merchant’s name and address), shall not be deemed to be agreed to or binding upon PF unless agreed to in writing in the form of an amendment signed by each party hereto.

41.   Headings and Construction. The headings used in this Agreement are inserted for convenience only and will not affect the interpretation of any provision. Merchant and Bank each acknowledge that the limitations and exclusions contained in this Agreement have been the subject of active and complete negotiation between the parties and represent the parties’ voluntary agreement. The parties agree that the terms and conditions of this Agreement shall not be construed in favor of or against any party by reason of the extent to which any party or its professional advisors participated in the preparation of this document.

42.   Authorization. Each of the parties hereto represents and warrants on behalf of itself that it has full power and authority to enter into this Agreement; that the execution, delivery and performance of this Agreement has been duly authorized by all necessary corporate, limited liability company or partnership or other appropriate authorizing actions; that the execution, delivery and performance of this Agreement will not contravene any applicable by‑law, corporate charter, operating agreement, partnership or joint venture agreement, law, regulation, order or judgment; that execution, delivery and performance of this Agreement will not contravene any provision or constitute a default under any other agreement, license or contract which such party is bound; and, that this Agreement is valid and enforceable in accordance with its terms.

43.   Counterparts. The parties agree that electronic signatures will have the same legal effect as original (i.e., ink) signatures and that an electronic, scanned, facsimile, or duplicate copy of such signatures may be used as evidence of execution.This Agreement may be executed and delivered in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

44.   Facsimile Deemed Original. Merchant and PF agree that any facsimile or other copy of this Agreement evidencing the execution by both parties shall be deemed an original.

45.   Inconsistencies. In the event of any inconsistency between any provision of this Agreement and the Operating Regulations, the Operating Regulations will govern.

46.   Member Bank. The Processor and Member Bank may jointly or individually assert or exercise any rights or remedies provided to Bank hereunder. Processor and Member Bank reserve the right to allocate Bank’s duties and obligations amongst themselves, as they deem appropriate in their sole discretion. As of the commencement of this Agreement, Member Bank shall be Fifth Third Bank, an Ohio banking corporation, located at 38 Fountain Square Plaza, Cincinnati, OH 45263.  The Member Bank may delegate certain or all of its duties to an affiliate of the Member Bank at any time, without notice to Merchant. The Member Bank may be changed, and its rights and obligations assigned to another party by Bank at any time without notice to Merchant.

47.   Bound by Electronic Form Submission. Merchant and Guarantor (defined below) agree that the electronic application process in which they are currently engaged uses an electronic signature process that allows the use of an electronic form submission to enter into and agree to the terms of this Agreement. Merchant and Guarantor acknowledge that they each intend to use this electronic application process to provide their respective agreements electronically. Merchant and Guarantor understand that these agreements by submission are legally binding, and are governed by the Federal Electronic Signatures in Global and National Commerce Act, and/or the Uniform Electronic Transactions Act governances (or an amended version thereof) as applicable in Merchant’s state of organization or incorporation and Guarantor’s domicile, and each agrees to be bound by these governances.

48.   Personal Guarantee: As a primary inducement to PF to enter into this Agreement, the Guarantor(s) indicated below jointly and severally, unconditionally and irrevocably, guarantee the continuing full and faithful performance and payment by Merchant of each of its duties and obligations under this Agreement, as it now exists or as amended from time to time, with or without notice. This guaranty is a guaranty of payment, and not of collection, and a debt of Guarantor for his or her own account. PF shall not be required to first proceed against Merchant or enforce any other remedy before proceeding against the undersigned individual. This is a continuing guarantee and shall not be discharged or affected by the death of the undersigned and shall bind the heirs, administrators, representatives and assigns and be enforced by or for the benefit of any successors of PF. The term of the guarantee shall be for the duration of the ATM Services Agreement and any addendum thereto and shall guarantee all obligations during the term thereof, though enforcement may be sought subsequent to any termination. The guaranty shall not be discharged or otherwise affected by any waiver, indulgence, compromise, settlement, extePFon of credit, or variation of terms of this Agreement made by or agreed to by PF and/or Merchant. I/We waive any notice of acceptance of this guaranty, notice of non-payment or non-performance of any provision of this Agreement by Merchant, and all other notices or demands regarding this Agreement. I/We agree to promptly provide to PF any information requested from time to time concerning my/our financial condition, business history, business relationships and employment information. Guarantor(s) understand that the inducement to PF to enter into this Agreement is coPFderation for the guaranty, and that this guaranty remains in full force and effect even if the Guarantor(s) receive no additional benefit from the guaranty.