Merchant Processing Agreement Terms & Conditions

These Terms and Conditions apply to your card processing agreement. For simplicity, Luqra (“LQ”) refers to itself as “we,” “our,” “Processor,” or “us” in this document. We refer to you (i.e., the legal entity or individual representing a business named in the Application) as “you,” “your,” or “Merchant.” Other parties may also be parties to this Agreement (e.g., Member Bank, Guarantor, etc.). Terms that are capitalized, but not defined, are defined in Section 18 or in the Application.

1. Terms and Exclusivity

1. Term: This Agreement binds you on the earlier of your execution of this Agreement, submission of your Application, or submission of a transaction. This Agreement binds us on the earlier of (i) the date we issue you a Merchant Identification Number; or (ii) the date we process your first transaction. Unless otherwise stated in the Agreement/Application, the initial term of this Agreement is 36 months (“Initial Term”). At the end of the Initial Term or any subsequent renewal term, the Agreement automatically renews for additional terms of 12 months each, unless either party gives written notice of its intent to terminate or not renew the Agreement at least 90 days before the then-current term expires, provided that if automatic renewal of this Agreement violates any Laws, the renewal term will be 30 days. For clarity, termination of this Agreement does not terminate your equipment lease, which may be subject to different term and termination provisions.
2. Exclusivity: This Agreement is a “requirements contract.” This means you shall exclusively receive the Services and any similar services from us. Prior to exercising any right of termination or non-renewal, you agree that we shall have a right of first refusal before you enter into an agreement with a third party for the Services. Except for term length, you agree that our right includes terms and conditions that are substantially similar to those discussed with the third party.

2. Rules, Regulations and Laws

As part of this Agreement, you agree to comply with, and to cause your employees and agents to comply with: (i) the Laws; (ii) the Rules Summary; (iii) the Operating Regulations and terminal update requirements related to optional Association programs, if applicable (and any related costs); (iv) the confidentiality and security requirements of (a) the USA Patriot Act and any related laws, rules, or regulations; and (b) the Associations and Networks, including the Payment Card Industry Data Security Standard, the Visa Cardholder Information Security Program, the Mastercard Site Data Protection Program, and any other Association or Network program or requirement. You accept any responsibility or liability (e.g., data breach liability) resulting from your decision not to participate in optional Association Programs (e.g., the Association EMV program).

3. Acceptance of Cards

1. You may elect to accept all card types or only certain Visa and Mastercard card types (“Limited Acceptance”). You are solely responsible for your Limited Acceptance program. This includes: (i) policing card types at the point of sale (“POS”); (ii) paying Association fees and charges for only accepting certain card types; and (iii) paying any costs we incur in connection with your Limited Acceptance. Our obligations are limited to those expressed in the Operating Rules. Should you submit a transaction for processing for a card type you have indicated you do not wish to accept, we may process that transaction, and you agree to pay any applicable fees, charges, and assessments. The card types are: (i) Debit Cards - U.S. and non-U.S. bank-issued Visa or Mastercard cards that access consumer asset accounts within 14 days of purchase, including stored value, prepaid, EBT, gift, or consumer check cards (“Debit Cards”); and (ii) Other Cards - all Visa and Mastercard cards other than Debit Cards, including business and consumer credit cards and cards issued by non-U.S. banks. Your Limited Acceptance program only applies to U.S.-issued cards. The Visa and Mastercard Operating Regulations require merchants accepting any card product bearing a Visa or Mastercard symbol to continue accepting both debit and credit card products issued by non-U.S. members.
2. If we are unable to obtain, or choose not to obtain, authorization from an Association or Other Network, we may “stand-in” for the Association or Other Network. If we stand-in, we will authorize the card transaction based on our own criteria. Our decision to stand-in does not change your obligation(s) to us.

4. Our Responsibilities

1. We will provide the Services in accordance with our then-current systems and standards. Nothing requires us to provide you with any special programming; any system, program, or procedure implementation; or any special hardware or software.
2. We will provide reports online for each fiscal day’s activity by 10:00 AM ET the next calendar day. Such reports will include an accounting for each currency with supporting details of transaction activity, daily proceeds, reserves, and funds transfers for transaction settlement. Reports will be available for download on the online reporting tool for a period of 14 months from the date of issue. Reports may be upgraded, enhanced, and/or modified by us at any time.
3. We will initiate payment to you for the amount of each accepted Card transaction only after we receive the funds. We have no obligation to deliver payment for any Card transactions that violate the terms of this Agreement or the Operating Regulations, regardless of when we become aware of any such violation, and the proceeds from any such transactions, including any proceeds held in the Reserve Account, are not amounts due to you or held for your benefit.
4. We have the right to honor and rely on the request(s) or instruction(s) of any person we reasonably believe to be your representative. In the event we receive returned mail intended for you, we may, but are not required to, procure a replacement address according to our standard operating procedures.
5. We are only responsible for processing credits and adjustments for Card transactions that we originally processed. You authorize us to audit all Card transactions and deposits. We have the right to withhold amounts from you if we discover inaccuracies as otherwise set forth herein.
6. We may report information about your account, late payments, missed payments, or defaults to credit bureaus.
7. We may suspend or cease providing any Services to you in response to a Member Bank, Network, or Association request. We will use reasonable efforts to notify you if we suspend or cease any Services.
8. We are responsible for the security of Cardholder data we store or transmit on your behalf only while it is in our possession and control.
9. Luqra LLC has converted to Luqra Inc. All rights, obligations, and agreements of Luqra LLC have been assumed by Luqra, Inc. The company (LQ) “we,” “our,” “Processor,” or “us” continues to operate under the same management and terms as before.

All references to “Luqra LLC,” “we,” “our,” “Processor,” or “us” now refer to Luqra, Inc. No action is required by existing partners, merchants, or clients.

5. Your Responsibilities

1. We have the right to charge your Designated Account (as defined in Section 6) without notice, or to require payment from you in any appropriate situation, for the amount of any Card transactions. This right includes Card transactions: (i) where merchandise is returned; (ii) where there is no valid authorization response; (iii) where the Cardholder has not given authority (e.g., improperly drawn, accepted, or endorsed transactions); (iv) where the Card transaction record is illegible; (v) where the Cardholder disputes the sale, quality, or delivery of merchandise or performance or quality of services; (vi) where the Card transaction was drawn by, or depository credit given to, you in a way that breaches the Agreement or violates the Laws or Operating Regulations; (vii) where we have not received and retained payment for the Card transaction (even if we have already paid you for the transaction); (viii) where it is alleged that you have failed to comply with the Operating Regulations, Rules Summary, or the Laws; (ix) where an Association or Other Network action (e.g., a Chargeback or compliance case) is pending or has been resolved against you; (x) where we have incurred claims, damages, or losses from any source, including Card issuers; or (xi) where the extension of credit for a Card transaction violated the Laws or Operating Regulations. Additionally, you remain fully liable to us for any transaction returned to us for any reason, including but not limited to Chargebacks or reversals for debit Card transactions. You agree to review all Chargeback- and reversal-related notices and reports (in any format). Your failure to respond to a Chargeback or reversal within the applicable deadline may forfeit your Chargeback rights. We have no duty to assist you in defending a non-compliance allegation related to a Chargeback.
2. You represent that any information you have supplied to us is true and accurate and that the name and tax identification number (“TIN”) on the Application matches the name and TIN that you use to file your tax returns. You agree to update your information with us when it changes. We may need to share your TIN, entity name, processing volume, principal’s social security number, or other information with governmental entities. You agree to cooperate with our requests for information for any reason. We may be required to withhold processing funds or to forward processing funds to the IRS if you supply incorrect information, or the Laws or government agency so requires. You expressly release us from any liability in connection with our withholding of funds or submission of information to a government agency, even if incorrect. You are responsible for any fines or penalties assessed against you or us.
3. You shall provide us a complete and accurate list of all websites and web addresses (“URLs”) that you use to market or promote your goods. The list of URLs shall be provided for an initial compliance review in connection with your Application and upon our request at any time thereafter. It is your responsibility to update the list of URLs on an ongoing basis and to notify us of any new URLs for a compliance review prior to processing any Card transactions through such URLs. You acknowledge and agree to make any changes to the content on such URLs that we deem necessary or appropriate in our sole discretion, including for purposes of compliance with Operating Rules or Laws. Notwithstanding the foregoing, we shall have no liability whatsoever to you or any third party regarding your URLs. You shall not submit any Card transaction flowing from a URL that has not been subject to such compliance review.
4. You shall not sell, purchase, provide, share, or exchange Cardholder name, address, account number, or other information to any third party (including your Agent) other than us, the Associations, or the Networks, and then only for the purpose of completing a Card transaction.
5. You agree to balance and reconcile the Designated Account and the Reserve Account (as defined in Section 8) each day. You shall immediately notify us of any missing or improperly deposited funds. Additionally, you agree to review our (or our agents’) reports (including those made available online), notices, and invoices. You agree to accept any report, notice, invoice, Service deficiency, or billing or payment error if you fail to reject or dispute it in writing within 30 days of the date we made it available to you. We may make our reports, notices, and invoices available to you in accordance with our standard processes, which are subject to change. For 60 days following our receipt of your written notice of an error or deficiency, you agree to refrain from making any loss or expense claims against us so that we have time to investigate the situation. If you notify us that a Card transaction batch has not processed, we may, at our option, attempt to re-present the missing Card batches dated during the 90-day period preceding the date we received your notice. We have no obligation to correct any errors that flow from your failure to comply with the duties and obligations in this paragraph.
6. You agree to provide us with audited annual financial statements for your business, using generally accepted accounting principles, at any time upon request. Additionally, you agree to provide any other financial information within 75 days of a request by us.
7. You shall timely assist us in complying with all Laws and Operating Regulations related to the Services. This obligates you to execute and deliver all instruments, including documents, we deem necessary for you to meet your obligations under the Agreement. Further, you agree to allow our auditors (third-party or internal), and the auditors of any Association or Other Network, to review the documents, records, procedures, systems, controls, equipment, and physical assets related to your transactions upon reasonable notice at any time. You also agree to assist our auditors as necessary. If an Association, Member Bank, or government agency requires a third-party audit, or if the Operating Regulations or Laws require a third-party audit, we may retain a third party to perform the audit or require you to immediately retain a specific third-party auditor and provide us with a final audit report. You agree to pay our audit costs or the audit costs of Member Bank, an Association, or Other Network.
8. In the case of a delayed merchandise delivery, you agree to deliver the Card transaction record to us within two (2) business days of the merchandise delivery (or as we specify in the Rules Summary). You agree to electronically deliver all other Card transactions and credit records to us in a suitable format within two (2) business days of the transaction (unless the Associations or Networks require the records earlier). You also agree to deliver Card transactions and credit records to us at least once every business day. Your delivery constitutes an endorsement of each recorded transaction. You authorize us or our representative to place your endorsement on any Card transaction at any time. We have the right to refuse to acquire any Card transaction. You waive notice of dispute related to any individual Card transaction.
9. You shall not store Cardholder data, including Track 2 data, in violation of the Laws or the Operating Regulations. Further, you shall not retain or store magnetic stripe data following the authorization of a Card transaction.
10. You are solely responsible for the quality, accuracy, and adequacy of all transactions and information you supply. Accordingly, you shall implement and maintain adequate audit controls for monitoring the quality and delivery of data. When submitting Card transaction, settlement, and other data and information to us, you agree to follow our communications processes and document formats. You agree to only transmit information and data to us with a secure system.
11. You may use a third-party agent (“Agent”) to perform some of your obligations under this Agreement, subject to our approval. Agents include your software providers and equipment providers. You shall cause your Agent to complete any Association-required steps or certifications (e.g., registrations, PCI DSS, PA-DSS, audits, etc.). You shall ensure that your Agent complies with all applicable requirements of this Agreement. You expressly assume all responsibility for the acts or omissions of your Agent as if they were your acts or omissions. If your Agent qualifies as a service provider under applicable Operating Regulations, you agree, at your expense, to cause the Agent to cooperate with us in our due diligence requests and in performing any steps required for registration and certification. You are responsible for conducting your own due diligence on your Agents, including the fitness of their services for a particular purpose and for determining the compliance of their services with the Operating Regulations and the Laws. You expressly assume all liability for the acts and/or omissions of your Agent even if we introduce or recommend the Agent, or resell the Agent’s services.
12. You agree that it is important to notify us about changes in your business. Because of this, you agree to provide us 30 days prior written notice of your intent: (i) to change business form or entity type; (ii) to sell stock or assets to another entity; or (iii) to make changes that would affect information on your Application, including but not limited to a change in the types of products or services that you sell or the types of business activities in which you are engaged. Additionally, you shall notify us within three days of any judgment, writ, warrant of attachment, execution, or levy against any substantial part (25% or more) of your assets. Should you change or add locations, you agree to follow our standards and procedures. Unless we agree otherwise, you agree that you will only present Card transactions to us that correspond to the activities and volumes described on your Application. Accordingly, we must pre-approve in writing increases in Card transaction volume over the amount stated on your Application. Changes in monthly volume, the stated average ticket size, or any other information on your Application entitle us to increase fees, delay or withhold settlement, or terminate this Agreement. Your failure to notify us of changes under this Section subjects you to liability for any losses or expenses we incur.
13. Excessive: Notwithstanding anything in this agreement to the contrary, your presentation to us or Member Bank of Excessive Activity will be a breach of this Agreement and may result in an Excessive Activity Fee and/or immediate termination of this Agreement, in our sole discretion. “Excessive Activity” means, during any monthly period for any one of Merchant’s terminal identification numbers or merchant identification numbers: (i) the dollar amount or number of chargebacks, fraud cases and retrieval requests exceeds 7% of the average monthly dollar amount or number of Card transactions; (ii) sales activity that exceeds by 25% or more the dollar volume indicated on the Merchant Application; or (iii) the dollar amount of returns equals 3% of the average monthly dollar amount of Card transactions. You authorize, upon the occurrence of Excessive Activity, us or Member Bank to take any action deemed necessary including, but not limited to, suspension or termination of processing privileges or creation or maintenance of a Reserve Account in accordance with this Agreement. The “Excessive Activity Fee” shall be equal to up to 1% of the amount constituting Excessive Activity.
14. Inactivity: Unless you are a seasonal merchant, failing to process any sales transactions for at least two (2) consecutive calendar months is considered an Event of Default and subject to the provisions of Section 7 of this Agreement.
15. Virtual Private Network (“VPN”)/Secure Socket Layer (“SSL”): Our standard VPN and SSL services establish an internet connection between you and us for processing your transactions. You are responsible for: (i) ensuring that your communication equipment is compatible with our VPN or SSL; (ii) ensuring that each terminal with a connection to the VPN or SSL has an active personal firewall; and ensuring a secure key exchange and key management process (including a process for key revocation when your personnel leave). Our VPN or SSL communication interface relies on the internet. You agree that the internet is not always reliable, and that internet problems and issues may interfere with our ability to process your transactions. Any service levels that appear in other parts of the Agreement do not apply to the VPN or SSL connection or to transactions transmitted using the VPN or SSL connection. We provide VPN and SSL services in accordance with our own standards, which are subject to change without notice. You agree to comply with any VPN and SSL standards we or the Associations or Other Networks establish.
16. Optional Services: We may offer you products and services through one or more third parties (“Optional Services”). You agree that, as available, the applicable third-party provider (“Provider”) solely supplies and/or supports all Optional Services. We are not a party to your contracts with Providers. You are responsible for conducting your own due diligence on any Provider that you use, including the fitness of its services for a particular purpose and for determining the compliance of its services with the Operating Regulations and the Laws, even if we resell the Provider’s services. You bear all of the risks associated with using an Optional Service. Although not an exhaustive list, we are not liable for: (i) exercising control over Provider; (ii) errors related to establishing and maintaining account relationships with Providers; or (iii) ensuring service levels with respect to the Optional Service(s). Our decision to offer any Optional Service shall not limit your duty to: (i) ensure that all account numbers are correct; (ii) notify Providers of changes to your ACH, address, and account information; (iii) pay all fees, fines, damages, losses, or expenses arising in connection with your possession or use of an Optional Service; (iv) perform your own due diligence before using an Optional Service; and/or (v) perform any other proper act related to your use of the Optional Service. You agree to indemnify and hold us harmless for any damage, loss, claim, or liability arising from your possession and/or use of any Optional Service. Each Provider has the right to require you to enter into a separate agreement with it. Whether you and Provider enter into a separate agreement, you agree that: (i) your rights and duties regarding the use of an Optional Service are neither assignable nor delegable without Provider’s prior written consent; (ii) you acquire no property right, intellectual property right, claim, or interest in any of Provider’s systems, equipment, software, processes, programs, or data; and (iii) you shall protect the confidentiality of Provider’s software and documentation.
17. You agree to pay us all Provider-imposed fees and assessments in connection with your use of the Optional Service(s). Your obligation to pay us shall continue until: (i) you have notified Provider(s) of your intent to cancel the Optional Service(s); (ii) you have provided us with notice that (a) you have notified Provider of your intent to terminate, (b) you have returned all equipment and software to Provider, and (c) you have ceased receiving all Optional Services; and (iii) Provider no longer assesses us for your receipt of the Optional Services or for possession of the equipment. You waive all rights to contest, challenge, or withhold payment for any fees we assess for Optional Services until you have satisfied the conditions in the preceding sentence.
18. You authorize us to contact your customers or their Card issuing bank(s) to find out information about any Card transaction. You shall not contact a Discover Cardholder unless authorized to do so by the Operating Regulations or required by Law.
19. Bankruptcy: You agree to execute and deliver to us any documents we request to perfect and confirm the lien, security interest, and setoff rights in this Agreement. You shall immediately notify us of any bankruptcy, receivership, insolvency, or similar action or proceeding initiated by or against you or any of your principals. Further, you shall include us on the list of creditors filed with the Bankruptcy Court, even if no claim exists at the time of filing. This is an executory contract to make a loan or extend other debt financing or financial accommodations to or for your benefit and, as such, cannot be assumed or assigned in the event of your bankruptcy. This is a contract of recoupment and we are not required to file a motion for relief from the automatic stay to realize on any of the Secured Assets. Nevertheless, you agree not to contest a motion for relief from the automatic stay. You must adequately fund the Reserve Account to provide us with adequate protection under Bankruptcy Code § 362. We have the right to consume and offset against the Reserve Account to cover your obligations under this Agreement, regardless of whether they relate to transactions created before or after your bankruptcy filing. Because this Agreement contemplates the extension of credit for your benefit, you acknowledge that you cannot assign the contract in the event of a bankruptcy. We may immediately terminate the Agreement if you fail to comply with any part of this Section.
20. Wireless Service Acknowledgement: We are not responsible for verifying your wireless service coverage, for losses in coverage, or for your failure to maintain coverage. By selecting wireless service, you acknowledge that wireless coverage is not guaranteed and that we have no control over the wireless service providers or the decisions they make. Additionally, you acknowledge that if wireless service is lost in your area, the equipment will not operate with another wireless carrier. We are not liable if wireless coverage is lost in a specific area and the equipment can no longer be used as a wireless terminal.
21. Virtual Terminal Processor Services and Fees: Our Virtual Terminal Processor Service (the “Virtual Terminal Service(s)”) is an additional service (subject to separate fees and charges). It allows you to effectuate Card transactions within the merchant portal application in accordance with your user IDs. You represent and warrant that you have implemented and will maintain secure systems for using the VT Services and transmitting information to us. You are responsible for any authorized or unauthorized transactions initiated using your user IDs. You assume all liability for (i) acts or omissions arising out of your use of the VT Services; and (ii) risks associated with using software with internet connectivity.
22. Equipment: If you enter into a lease or rental agreement for the use of credit card processing equipment, you understand that such agreement is separate and apart from this Agreement and is subject to the terms and conditions of the lease or rental agreement. Neither we nor Member Bank is a party to any such lease and neither is affiliated with the third-party institutions. Such leases are typically non-cancelable 48-month leases. Termination of your Agreement with us does NOT automatically terminate your equipment lease, it only terminates your processing agreement with us. You acknowledge that you have selected the equipment set forth on the Merchant Application based upon your own independent evaluation and you are not relying upon any warranty or representation of any third party, including but not limited to the representations of a sales representative, regarding the equipment. Processor is not responsible for and is not able to provide customer service for equipment, such as POS devices, installed by and/or operated by any third party. Merchant should contact the third party for service of this equipment. Merchant shall not allow any third party to install, remove, or modify any terminal equipment or software application of ours or Member Bank without the express written consent of us or Member Bank.

6. Fees and Other Services

1. You agree to pay fees, cost escalations, assessments, tariffs, penalties, and fines we incur caused by your use of the Services, claims, or other items under this Agreement or the Operating Regulations. We will periodically (daily, monthly, etc.) calculate your fees and charges and debit the bank or deposit account(s) that you designate (“Designated Account(s)”) to collect those amounts. We have the right to determine and change the periodic basis (daily, monthly, etc.) in the previous sentence in our sole discretion, without notice. We have the right to round, assess, and calculate interchange and other fees and amounts in accordance with our standard operating procedures. We also have the right to assess some or all of the fees and charges via a separate or combined Services invoice(s). We will charge you for any fines, fees, penalties, loss allocations, assessments, registration expenses, certification expenses, telecommunication expenses, sponsorship fees, and other amounts assessed by Member Bank and/or third parties or incurred as a result of your actions, omissions, or use of the Services, or those we incurred on your behalf under the Operating Regulations, the Rules Summary, and the Laws.
2. Transaction fees are fees charged on each authorization, Card draft, credit draft, or other transaction type, regardless of the stated total (“Transaction Fee(s)”). We may charge a Transaction Fee for any transaction activity.
3. Visa, Mastercard, and Discover Interchange fees, assessments, and other amounts will be either (i) assessed to you separate from and in addition to the Discount Rate, Transaction Fee, and other fees listed in the Application; or (ii) included in the Discount Rate and/or Transaction Fee listed in the Application. For American Express Card transactions, we will assess interchange fees, assessments, and other fees in addition to the Authorization Transaction Fee and other fees described in the Application. For American Express Card transactions under Tiered Transaction Pricing, interchange fees and other amounts will be included in the Discount Rate and/or Transaction Fee listed in the Application. For Debit Card transactions under Tiered Transaction Pricing, we will assess interchange fees, sponsorship fees, switch fees, and gateway fees as pass-through, and other amounts will be included in the Discount Rate and/or Transaction Fee listed in the Application. Certain fees are available upon request or through the Associations. You are responsible for conducting your own inquiry into the nature and type of applicable fees. The Discount Rate, Transaction Fee, and other fees may be based, in whole or in part, on interchange rates, assessments, and other fees that the Associations and Other Networks periodically change.
4. You acknowledge that in order to receive the best Discount Fee and Transaction Fee on a particular Card transaction, the transaction must first “qualify” and exactly meet certain criteria. Several factors can prevent a Card transaction from qualifying, including that it: (i) was hand-entered (i.e., the encoded card information was not read by a POS device); (ii) was voice-authorized; (iii) was not authorized; (iv) was not transmitted for processing within 24 hours; (v) was a Consumer or Commercial Reward transaction, a Visa Signature transaction, or a Mastercard World Elite Card transaction; (vi) was deemed a “Non-Qualifying” transaction by the Operating Regulations (e.g., certain foreign transactions or transactions from business, commercial, purchasing, or government Cards); (vii) was difficult to capture; (viii) was difficult to authorize; (ix) was submitted incorrectly; or (x) was not eligible for the lowest electronic interchange fee for any other reason. Additionally, you might not qualify for the best Transaction Fee or Discount Rate if your average ticket differs from what we used to calculate the Transaction Fee and/or Discount Rate; if you submit more than 5% of your monthly Card drafts without electronic transmission; or if your terminal, software, or communications lines fail to function properly. The Associations change the transaction qualification criteria from time to time. For certain non-qualifying transactions, we assess a surcharge of a certain percent of the transaction amount. In the event that your Card transactions under Tiered Transaction Pricing do not qualify or only partially qualify for the qualified discount rate quoted on the Merchant Price Schedule and/or the Operating Regulations, you agree to pay the Mid-Qualified Discount Rate and/or Transaction Fee, or Non-Qualified Discount Rate and/or Transaction Fee set forth on the Application. We do not guarantee that your transactions will qualify for any given rate, and we disclaim all responsibility and liability for a transaction’s failure to so qualify. In addition, Card transactions that do not meet the necessary criteria for payment are subject to complete denial and/or Chargeback.
5. You shall pay all taxes imposed in connection with the Services. If we pay taxes for you, we can immediately debit your Designated Account or demand payment from you.
6. Your use of any service not listed on the Application or provided at the commencement of the Agreement obligates you to pay any accompanying fees, charges, and related expenses. If you receive these Services, you will be deemed to have consented to the fees, charges, and expenses. We have no obligation to enhance or customize Services or additional services, but we may choose to do so for a separate fee. You shall take all necessary steps to ensure that you can receive the Services, at your own cost. This includes procuring equipment and software and taking other steps as we direct.

7. We reserve the right to charge you a reasonable fee if we reasonably believe you are not fully compliant with the Rules Summary, Operating Regulations, the Payment Card Industry (“PCI”) Data Security Standard (“PCI DSS”) and Payment Application Data Security Standard (“PA-DSS”), or any Laws, or if you fail to prove compliance upon our request. This fee will be in addition to any other amounts payable under the Agreement.

8. After your initial conversion to us, you agree to pay all direct and indirect costs (including those we, our affiliates, or our agents incur) related to any conversion to or from us as applicable, and/or relating to any programming effort affecting the Services.
9. If we advance funds to you or delay your obligation to pay funds, we reserve the right to assess you a cost of funds in the manner and amount of our determination. After we approve your Application, we will begin assessing any applicable monthly recurring charges. This Agreement subjects you to an Annual or Semiannual Fee and a Monthly Minimum Fee, unless otherwise noted on the Application. In the event this Agreement expires or terminates for any reason, the Annual or Semiannual Fee, as applicable, will not be prorated or refunded. If applicable, we may assess the ACH Fee listed on the Application for administrative services.
10. If merchant exceeds a VAMP ratio (VISA acquirer Monitoring Program Ratio – defined as, combined VISA fraud count and dispute count divided by VISA Card Not Present transaction count) greater than 50 basis points (0.50%) and a VAMP count exceeding 5 in a given month, merchant agrees to auto-enrollment for access to the VAMP and TC40 reporting module at a cost of $149.00 per month. Additionally, if merchant meets or exceeds a VAMP ratio of 220 basis points (2.20%), merchant agrees to a monthly “VAMP Monitoring Fee” of $50.00 to be assessed.
11. If VAMP ratio (VISA Acquiring Monitoring Program Ratio – combined VISA fraud count and dispute count divided by VISA Card Not Present transaction count) exceeds a VAMP count of 5 and a ratio of 40 basis points (0.40%) in a given month, merchant will be assessed fees at the tiers and per item cost outlined in the table below.

7. Termination or Suspension of Services

1. Default Event: You are in default under this Agreement (“Event of Default”) if: (i) we believe there has been a material or potentially material deterioration of your financial condition; (ii) you become subject to any voluntary or involuntary bankruptcy, insolvency, reorganization, or liquidation proceeding, a receiver is appointed for you, or you make an assignment for the benefit of creditors, or admit your inability to pay your debts as they become due; (iii) you cease doing business as a going concern, or there is a Change in Control; (iv) you are in breach of any of the terms of the Agreement; (v) we reasonably believe fraud may be occurring including, without limitation, splitting tickets or laundering tickets; (vi) your name or your principals’ names are listed on the MATCH (Membership Alert to Control High Risk Merchants) System, Discover Merchant Control, or other security or credit alert systems, or you are identified under an Association risk monitoring program; (vii) we determine that your Card transactions or the circumstances surrounding your Card transactions have become irregular or increase our exposure to Chargebacks, reputational, or other security risks; (viii) we receive instructions from an Association or Other Network to close your account; (ix) you become subject to any criminal or civil action, suit, or proceeding or to any government or regulatory investigation or enforcement action; (x) circumstances exist that could cause harm or loss of goodwill to the Associations or Other Networks; (xi) you no longer meet the eligibility requirements of an Association or Network; (xii) you present Excessive Activity for processing; (xiii) you experience returns greater than 3% in a month or Chargebacks greater than 1% in a month; or VAMP (VISA Acquirer Monitoring Program) Ratio (combined fraud count and dispute count) are equal to or greater than 200 basis points (2.00%) in a month; (xiv) you cease doing the kind of business described in the Application; (xv) you fail to process any sales transactions for at least two (2) consecutive calendar months and are not a seasonal merchant; (xvi) you fail to pay any amount owed under this Agreement to us when due; (xvii) we believe that you have violated or are likely to violate the Operating Regulations, Rules Summary, or the Laws; (xviii) you engage in, or are suspected to have engaged in any of the following acts: (a) illegal business activities; (b) collusive fraudulent transactions with Cardholders; (c) laundering or aggregating illegal and/or brand damaging transactions; (d) establishing your account with us through identity theft; or (e) any other fraudulent act (each such act, an “Improper Transaction”); (xix) you assign this Agreement without our prior consent; or (xx) you solicit or accept mail orders or telephone orders or any transaction in which the Cardholder and Card are not present without prior written authorization from us. We shall determine the existence of an Event of Default and our determination is conclusive unless you contest it in writing within 90 days following our determination. Upon the occurrence of an Event of Default, we may exercise any right or remedy in this Agreement with or without notice, or may decide to pursue no remedy at all in our sole discretion. Our remedies for an Event of Default include: (i) terminating the Agreement; (ii) suspending or ceasing to provide the Services; (iii) collecting the Early Termination Fee, if applicable; (iv) diverting all Card transaction proceeds to a Reserve Account; (v) collecting any amounts you owe us by means of setoff, recoupment, or any other legal means; (vi) recovering fees and costs, including attorneys’ fees associated with the investigation of any suspected fraudulent activity or Event of Default; and/or (vii) damages equal to your average monthly fees for the three (3) calendar months that your revenue was highest during the preceding twelve (12) months (or during the period of the Agreement if it has not been in effect for twelve (12) months), multiplied by the number of months then remaining in the term of the Agreement. You agree that any damages assessed by us are fair and reasonable because it is difficult or impossible to estimate our damages following an Event of Default, and that the pricing we extended to you assumed that you would use and pay for the Services during the entire Term. Notwithstanding the foregoing, any Improper Transaction shall result in immediate termination of this Agreement by us. Termination for any reason shall not relieve you of any liability or obligation you owe us. We have a right to assess fees and recover all costs associated with our investigation of suspected fraudulent activity or Event of Default. If you accept transactions in connection with an Event of Default, we have the right to hold settlement funds and to subject them to a per month fraudulent transaction fee equal to 15% of the amount held to offset our losses and anticipated losses. We have no liability to you for any direct or indirect losses you may suffer as a result of our suspension of funds disbursement or failure to pay transactions in connection with an Event of Default.
2. Early Termination: If you terminate the Agreement prior to the end of the Initial Term, or if we terminate this Agreement due to inactivity as specified in Section 5.N of this Agreement or any other reason set forth in this Agreement, you shall pay us a fee to compensate us for early termination of the Agreement in the amount specified in the Merchant Application (“Early Termination Fee”) for each merchant identification number (“MID”) and Merchant location.
3. Returning of Equipment/Materials: You shall return our equipment, promotional materials, advertising displays, emblems, Card drafts, credit memoranda, and other forms within 14 days of termination. You agree to immediately pay any amounts you owe for equipment. Without limiting the foregoing, if you fail to return equipment loaned to you by us within 21 days of termination of this Agreement or cancellation of your account for any reason, or if you return equipment in any damaged condition not due to normal wear and tear (in our sole discretion), we reserve the right to assess and collect from you the fair market value of the equipment, in our determination.
4. Remedies: Our rights and remedies under this Agreement and/or at law or in equity are cumulative.
5. Terminated Merchant File/ Discover Merchant Control: You acknowledge and consent to our obligation to report your business name and the name of your principals to the Associations if we terminate you due to the reasons listed in the Operating Regulations, including for breaching this Agreement. You agree to refrain from bringing any claims against us for reporting you to the Associations.
6. No Effect on Lease: Termination of this Agreement for any reason does not automatically terminate your equipment lease, if applicable.
7. Effect of Termination: Upon termination of this Agreement for any reason at any time, you agree to pay us in addition to any other amounts required by this Agreement (i) any unpaid fees or invoices due; and (ii) any damages, losses, expenses, fees, fines, penalties, Chargeback amounts, and adjustments we incur in connection with the Agreement. You authorize us to debit your Designated Account to deduct amounts you owe us under this Section from the settlement funds we owe you, or to deduct such amounts from the Reserve Account. You are responsible for any collection fees, legal fees, and other expenses we incur in recovering your delinquent amounts.
8. MATCH/TME: You acknowledge that we may, in accordance with Association rules, add you, any person who signed the Application, and any Guarantor to Mastercard’s MATCH system, Visa’s Terminated Merchant File, and/or any other similar system or list.

8. Authorization, Setoff, Reserve, and Security Interest

1. You authorize us, our agents, and third parties to initiate ACH credit/debit entries to or from the Designated Account, the Reserve Account, or any other account you maintain at any financial institution that is a member of an ACH Network, including for amounts you owe us, that we owe you, or for correction of errors, including but not limited to any liabilities or losses owed to us. This authorization applies even if and after you change the Designated Account. It survives the termination of this Agreement until the later of (i) two (2) years from the Agreement’s expiration; or (ii) the date you have satisfied all of your obligations to us. You shall ensure the Designated Account(s) have funds sufficient to satisfy your contingent and accrued obligations and duties under this Agreement. No attempt to change or alter the bank or deposit account you identify as the Designated Account (an “Account Change”) is effective until we acknowledge the change on our system. Accordingly, you shall not close a previous Designated Account until the new Designated Account receives its third deposit under this Agreement. We are not responsible for checking the accuracy of any Account Change your purported representatives submit in connection with an Account Change. Additionally, we are not responsible for liability associated with any Account Change unless it is due to our gross negligence or willful misconduct. You are solely liable for all fees and charges your financial institution assesses, including overdraft and non-sufficient funds charges. You release and hold us harmless from any financial institution fees or charges, regardless of cause. We are not liable for any delays in receipt of funds or errors in debit and credit entries caused by unaffiliated third parties, including the Associations, Other Networks, a clearinghouse, or your financial institution. We may audit and verify all Card and credits you accept. You agree that we may debit or credit your Designated Account for any inaccuracies. You also agree to be bound by the National Automated Clearing House Association’s operating rules.
2. You agree that payment is due the date we originate an ACH debit transaction record to your Designated Account. Fees not paid when due bear interest at the rate permitted by law. You are responsible for paying all fees without setoff or deduction. We have the right to setoff amounts you owe us from amounts we owe you or your affiliates.
3. The closing of your Designated Account does not constitute a mutually agreed upon termination of this Agreement, although it may be considered a termination of this Agreement by you.
4. All funds resulting from transactions are held in a pooled clearing account (“Clearing Account”) with our banking partner. We will settle funds to and from the Clearing Account in the manner described in this Agreement; however, you have no rights to the Clearing Account or to any funds held in the Clearing Account, you are not entitled to draw funds from the Clearing Account, and you will not receive interest from funds maintained in the Clearing Accounts.
5. In some circumstances based upon your processing history, your potential risk of loss to us or Member Bank as we may determine from time to time, your business type, your time in business, your financial information, your requested average/high ticket, your online reputation, or any combination of these or other similar factors, we may require you to create a reserve of funds (“Reserve Account”) in an amount determined in our sole discretion (“Reserve”). For example, and without limitation, we may require a Reserve if you have violated or are likely to violate this Agreement, or your account with us has an elevated or abnormally high number of Chargebacks or disputes, if we determine you are committing fraud or violating the Laws, or if you become subject to a civil, criminal, regulatory, or administrative investigation or litigation. If we impose a Reserve, we will establish the terms of the Reserve and provide you notice of the amount, timing, and conditions upon which the funds in the Reserve Account will be released to you. Unless otherwise specified by us or Member Bank in writing, the Reserve Account shall be fully funded upon three (3) days’ notice to you, or in instances of fraud or suspected fraud, an Event of Default, Reserve Account funding may be immediate. Reserve Account funding may occur by all or any combination of the following: (i) from settlement amounts, transaction proceeds, or any other amount otherwise payable to you; (ii) debits to any other accounts held by us or Member Bank; and/or (iii) your payment to us of the amount needed to fund a Reserve Account during this Agreement at the Reserve amount. We may change or condition the terms of the Reserve based on our continuous assessment and understanding of the risks associated with your account, including if required to do so by the Member Bank. We have the right to use any Reserve to cover any amounts due or that might become due to us at any time, including any amounts that remain unpaid after we debit (or attempt to debit) your Designated Account. Reserve Account funds may be commingled with other funds and need not be maintained in a separate account designated in your name. Subject to the other terms of this Agreement, we have the right and discretion to retain funds placed into the Reserve Account until the later of: (i) 270 days after the termination of this Agreement; (ii) 180 days after the last Card processing activity under this Agreement; or (iii) the conclusion of any pending criminal, civil, administrative, or regulatory investigation or litigation (the later of these three dates shall be the “Refund Request Date”). After the Refund Request Date, you must request in writing to receive the funds in the Reserve Account, and such request must include current information delivery of such funds.
6. We or Member Bank, without prior notice to you, may deduct from the Reserve Account any obligation of you to us or Member Bank under this Agreement, including all Chargebacks, liabilities, losses, and any and all additional fees, and sums sufficient to reimburse Bank for the amount of any fines, penalty amounts, and charges due to the Card Associations.
7. You shall not sell, assign, transfer, or encumber any part of your interest in the Reserve Account, or any present or future rights under this Agreement, including your right to receive payments or funds. Neither we nor Member Bank are obligated to honor any purported attempt to sell, assign, transfer, or encumber any interest, rights, or payments. In the event you breach this Section, we have the right to withhold funds payable to you, in addition to any other rights we may have at law or equity. You shall indemnify and hold us harmless from and against any claims, liabilities, and damages that any person (including a purported assignee) may assert against us arising out of your purported sale, assignment, transfer, or encumbrance of all or any of your present or future rights under this Agreement.
8. This Agreement is a security agreement under the Uniform Commercial Code. You grant us a security interest in and lien upon all: (i) funds in the Designated Account; (ii) funds in the Reserve Account; (iii) amounts due you under this Agreement, including rights to receive payments or credits; and (iv) proceeds in any account or from any Card transaction (collectively, the “Secured Assets”), to secure all of your obligations under this Agreement. For Secured Assets maintained by Member Bank, you authorize Member Bank to comply with our demands regarding the Secured Assets. Our control of the Secured Assets with Member Bank constitutes a perfected interest under Article 9 of the Uniform Commercial Code. We may direct the disposition of the Secured Assets without further consent from you. You represent and warrant that we have the only security interest in the Secured Assets. You agree not to grant a security interest in the Secured Assets to a third party without our prior written consent. Additionally, we have a contractual right of setoff against the Secured Assets. Our right of setoff shall be deemed to have been exercised immediately upon the occurrence of an Event of Default without any action by us or notation in our records, even if we enter the setoff on our books and records at a later time.

9. Ideminification and Limitation of Liability

1. You shall indemnify and hold us, and our directors, officers, employees, affiliates, and agents harmless from and against all proceedings, claims, demands, losses, liabilities, damages, and expenses (including any fines, fees, assessments, audit fees, card replacement costs, or penalties levied against us by an Association, any Card issuer, or any Other Network, and attorneys’ and collection fees and expenses) resulting from or otherwise arising out of: (i) your use of the Services; (ii) any breach of any term or condition of this Agreement; (iii) any misrepresentation by you under this Agreement and Application; (iv) your acts or omissions in connection with the Services under this Agreement, including the acts and omissions of your employees and agents; (v) your processing activities and provision of goods and services to Cardholders; (vi) any violation of the Operating Regulations, the Rules Summary, or the Laws by you; (vii) any guarantees we provide to a third party for your benefit, including lease guarantees; (viii) any infiltration, hack, breach, or violation of the processing system resulting from, arising out of, or in any way related to your ability to use the Services, including your use of an Agent or any other third-party processor or system, or your ability to connect to the Internet or an external network; (ix) any act or omission of a third party with which you have contracted; (x) any bankruptcy proceeding; (xi) effecting transactions with the use of a lost, stolen, counterfeit, or misused Card; (xii) any action you institute against any Association, Other Network, or Card issuer following a Chargeback or fine; or (xiii) any action we take against the Designated Account, Reserve Account, or any other account you own, pursuant to this Agreement. You shall also defend, indemnify, and hold harmless the institution that maintains your Designated Account for acting in accordance with any instruction from us regarding the Designated Account. This indemnification shall survive the termination of the Agreement.
2. EXCEPT FOR THOSE EXPRESS WARRANTIES MADE IN THIS AGREEMENT, WE DISCLAIM ALL WARRANTIES, INCLUDING ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. You acknowledge and assume all risks associated with the acceptance of cards. We are not 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 us) you or your customers or any third party suffers in connection with the Services. We are not liable for damages or losses wholly or partially caused by you or your employees or agents. Nor are we liable for any damages or losses you may sustain as a result of our exercise of post-default rights or remedies under this Agreement, provided we had a good-faith, reasonable basis to believe an Event of Default occurred. Our liability related to or arising out of this Agreement shall not exceed the fees paid to us for the particular Services in question for the calendar month preceding the date of our relevant act or omission. The parties acknowledge that the limitations in this Section are integral to the amount of fees we charge for the Services. Except as otherwise described in this Section, your exclusive remedy for any claim against us is termination of the Agreement. We are not 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 errors in data you or other parties provide to us, or any event beyond our reasonable control, including the Force Majeure Events defined below.
3. We are not liable for, nor in default under this Agreement, for any delays, failure to perform, loss of performance, or interruption in service resulting directly or indirectly from a Force Majeure Event. A “Force Majeure Event” includes labor disputes; fire; weather; acts of God; acts of a public enemy; other casualty; pandemic; power outages; funding delays (however caused); governmental orders or regulations; errors in data provided by you or others; international, domestic, and/or economic terrorism; or any other cause, whether similar or dissimilar to those just mentioned, beyond our reasonable control.
4. Except for actions related to your failure to pay amounts due under the Agreement, no cause of action shall be brought by either party more than one (1) year after it accrued.
5. You recognize and agree that any limitations of liability set forth in this Agreement are fair and reasonable.

10. Confidentiality

1. We will be providing you with Confidential Information. “Confidential Information” includes information relating to our methods, techniques, programs, devices, and operations and those of Providers, the Associations, and Other Networks. You shall not disclose Confidential Information to any person or entity, other than to your employees and agents who participate directly in the performance of this Agreement and need access to the information. You agree to comply with the confidentiality and security requirements of the Rules Summary, the Laws, and the Operating Regulations. This includes the Visa Cardholder Information Security Program found at https://usa.visa.com/partner-with-us/pci-dss-compliance-information.html; the Mastercard Site Data Protection Program, found at https://www.mastercard.us/en-us/business/overview/safety-and-security/security-recommendations/site-data-protection-PCI.html; and the American Express Data Security Operating Policy, found at https://www.americanexpress.com/us/merchant/us-data-security.html; and any similar Association or Other Network program requirement. You acknowledge receipt of our privacy notice, as applicable (“Privacy Notice”), which is incorporated by reference herein. Notwithstanding anything to the contrary in the Privacy Notice or this Agreement, we have the right to use, disclose, share, and retain any information you provide or that arises out of the Services, during the term and thereafter: (i) with your franchisor or franchisee(s), association(s) you belong to or belonged to at the commencement of this Agreement; (ii) with your affiliates; (iii) in response to subpoenas, warrants, court orders, or other legal processes; (iv) in response to requests from law enforcement or government agencies; (v) to comply with Laws; (vi) with our affiliates, business partners, and agents; (vii) to Associations and Other Networks and their designees, (viii) to Providers and their designees; (ix) to any other referral source or processor, including the applicable referrer, ISO/MSP, or independent Card office; (x) to perform analytic services for you, us, and/or others, including analyzing, tracking, and comparing transaction and other data to develop and provide insights for those parties as well as for developing, marketing, maintaining, and/or improving our products and services; and/or (xi) to offer or provide the Services under this Agreement. You authorize us to (i) make public the execution of this Agreement, this Agreement, and/or the provision of Services under this Agreement; and (ii) include your name and logo on a list of our customers that may be shared with the public.
2. You must secure and prevent the unauthorized access of any systems and media containing account, Cardholder, or transaction information (physical or electronic, including account numbers, Card imprints, and terminal identification numbers). Except for Card drafts you maintain in accordance with this Agreement or the Laws or Operating Regulations, you shall render inoperative and unreadable any media you no longer deem necessary or appropriate to store. You shall notify us of the identity of any third party who will have access to Cardholder data (“Merchant Provider(s)”). You shall also ensure that: (i) Merchant Providers cannot access Cardholder data unless authorized by the Operating Regulations; (ii) Merchant Providers have proper security measures to protect Cardholder data; (iii) you and Merchant Providers comply with the PCI DSS and PA DSS, as applicable; and (iv) you have written agreements with Merchant Providers requiring compliance with the terms of this Section. You shall immediately notify us of any suspected or confirmed loss or theft of any transaction information. This includes any loss or theft from a Merchant Provider. You are responsible for demonstrating your and Merchant Providers’ compliance with the PCI DSS and PA-DSS. You agree to provide us reasonable access to your locations and the locations of your Merchant Providers so that we can, at our option, verify whether you and your Merchant Providers can prevent future security violations. In the event of a suspected or confirmed loss or theft of information, you agree, at your expense, to provide any information, whether requested by us, an Association, financial institutions, or a local, state, or federal official in connection with the event. You further agree to cooperate in any ensuing investigation, including any forensic investigation. The information you provide in response to an investigation shall be considered our confidential information. The requirements of this provision apply to Cardholder data regardless of the medium in which the information is contained and regardless of whether you process transactions via internet, mail, phone, face-to-face, or any other method.
3. Our proprietary and confidential online portal service provides reporting detail about your use of the Services (“Portal Services”). We reserve the right to disallow, discontinue, suspend, or change your use of Portal Services at any time without notice, including if we determine that you are committing fraud, violating the Laws, or are involved in any civil, criminal, regulatory, or administrative investigation or litigation. You agree to maintain the confidentiality of any Portal Services passwords in your possession. If we provide Portal Services to you, our only obligation is to make the Portal Services available in accordance with our standard operating procedures (e.g., then-current timeframes, standards, scheduling, and procedures, including those for setup, account access, and suspension of Portal Services). You shall provide us with prompt written notice of account or user ID changes, including User IDs that are no longer active or should be deleted. You are solely responsible for any unauthorized access to Portal Services, including unauthorized employee or agent access, or third-party access. We have no liability for third-party interruptions in Portal Services (e.g., internet providers), or errors or inaccuracies in the data reported to you.

11. Continuing Unlimited Guaranty

This Section (“Continuing Unlimited Guaranty”) applies to each person who signs this Agreement as a guarantor (each a “Guarantor”). To induce us to enter the Agreement, each Guarantor jointly and severally guarantees the prompt and full payment of all Obligations (defined below) when due.

1. “Obligation” means any obligation in the most comprehensive sense of the word. Obligation includes all indebtedness, debts, and liabilities (including principal, interest, late charges, collection costs, attorneys’ fees, and the like) that Merchant owes us including under this Agreement, whether Merchant created the obligation alone or with others, and whether Merchant is primarily or secondarily responsible. Obligations can be secured or unsecured, absolute or contingent, liquidated or unliquidated, and direct or indirect. Obligations can be evidenced by note, draft, a guaranty agreement, or otherwise. Obligations can exist now or arise in the future. It includes all payment obligations, indemnification obligations, and indebtedness Merchant owes us arising from or related to the transactions or Services under this Agreement.
2. Guarantor promises to pay any Obligation that Merchant has not promptly paid when due. Guarantor promises to pay irrespective of our actions or inactions regarding the Obligations, or whether we have enforced any security interest created under this Agreement. Guarantor further promises to pay irrespective of the invalidity, insufficiency, or unenforceability of any Obligation. Guarantor’s obligations shall not be affected, modified, or impaired by any counterclaim, set-off, deduction, or defense based upon any claim the Guarantor may have against you (Merchant) or us, except payment or performance of the Obligations.
3. Guarantor waives notice of any acceptances of this Continuing Unlimited Guaranty. Guarantor waives presentment, demand, protest, notice of protest, and notice of dishonor or other non-payment of any Obligations. Further, Guarantor waives notice of sale or other disposition of any collateral or security we now hold or later acquire. The duties of Guarantor shall not be released, discharged, or modified by (i) our extending the time for payment (for Merchant or Guarantor); or (ii) our delay or omissions in exercising any rights, taking any actions, or pursuing any remedies against Merchant or Guarantor. Guarantor agrees that we may release or modify any collateral, security, or other guaranties without notice or consent from Guarantor and without modifying Guarantor’s duties to us. This is a guaranty of payment and not of collection. We have no obligation to demand or pursue any rights against Merchant, anyone else (including another Guarantor), or to exhaust any rights or remedies related to any collateral, security, or other guaranties before demanding payment from Guarantor. Guarantor waives all defenses based on suretyship or impairment of collateral. Following a default under this Agreement, we may apply and/or set-off against amounts due to us any deposits, account balances, or other credits of Guarantor in our possession. Guarantor grants us a security interest in the items just described.
4. The obligations of each Guarantor shall be joint and several with Merchant and any other Guarantor under this Agreement. The property described in any collateral security documents Guarantor provides, whether previously, contemporaneously, or in the future, secures this Continuing Unlimited Guaranty. This Continuing Unlimited Guaranty shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, successors, transferees, and assignees.

12. Dispute Resolution, Governing Law, Jury Waiver, and Class Action Waiver

This Section applies to you, any Guarantor, or any other party who claims an interest in this Agreement.

1. Dispute Resolution:  The parties will attempt to resolve any disputes relating to this Agreement in good faith and in a timely manner by mutual consultation. If a dispute remains unresolved for more than sixty (60) days, then such dispute shall be resolved as set forth in Section 12.B of this Agreement. Nothing in this Section 12.A prohibits a party from applying to a court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other equitable relief at any time.
2. Governing Law/Jurisdiction: The parties have entered into this Agreement in California. The laws of California govern the interpretation, construction, and enforcement of this Agreement, including the Continuing Unlimited Guaranty. We, you, and each Guarantor agree to bring any legal suit, action, or proceeding arising out of or related to this Agreement, the Services, or pertaining in any way to the relationship between us and you, or us and Guarantor, each an “Applicable Claim,” in state or federal court located in Orange County, California. With respect to any Applicable Claim brought by us, you or Guarantor, you/Guarantor waive any objection to venue and submit to the personal jurisdiction of the courts located in Orange County, California. You/Guarantor agree that our service of any summons and complaint at the address listed in the Agreement constitutes proper service and subjects you/Guarantor to the personal jurisdiction of the courts located in Orange County, California. Unless the Operating Regulations require otherwise, you shall bring any claim you have against Member Bank against us (subject to the limitations and restrictions of the Agreement), and not against Member Bank.
3. Jury: WE, YOU, AND GUARANTOR KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVE ANY RIGHT TO HAVE ANY APPLICABLE CLAIM OR OTHER CLAIM ARISING OUT OF THIS AGREEMENT OR THE SERVICES DECIDED BY A JURY. YOU AND/OR GUARANTOR AGREE THAT OUR FILING OF A COPY OF THIS PARAGRAPH IN ANY PROCEEDING CONCLUSIVELY PROVES YOUR WAIVER AND THE WAIVER BY GUARANTOR.
4. Class Action Waiver: YOU AND GUARANTOR WAIVE ANY RIGHT TO PARTICIPATE, AS A NAMED CLASS REPRESENTATIVE OR NAMED PLAINTIFF, IN A CLASS ACTION AGAINST US OR MEMBER BANK IN CONNECTION WITH THIS AGREEMENT OR THE SERVICES.

13. Next Day Funding

If you request and are approved for Next Day Funding, we will generally initiate an ACH of settlement funds due to you to the Designated Account within one business day (i.e., any day Federal Reserve Banks are open for business), provided we receive the complete transaction data by the applicable cutoff time. We have no liability to you if we do not ACH your settlement funds within one business day. If you are not approved for Next Day Funding, we will set you up with Premium ACH for your deposit timeframe. We can change your deposit timeframe from Next Day Funding to Premium ACH without notice. We can also, in our sole discretion, delay your settlement payments for up to thirty days from the date we received the settlement payment. This does not preclude us from exercising our right to establish a Reserve Account or to suspend payments pursuant to other provisions of this Agreement. On the next business day following the expiration of the delay period, we will begin crediting the settlement payments to your Designated Account, less any amounts you owe us. This delay of the settlement payments will be ongoing and will continue as long as we are providing you with processing Services (i.e., it will be a rolling delay). Additionally, we have the right to delay, in our sole discretion, crediting the Designated Account with funds evidenced by submitted Card transactions. You are responsible for verifying the amount of funds actually deposited to and available in your Designated Account on a daily basis. We are not responsible for the availability of funds represented by submitted Card transactions, or for any charges you incur for overdrawing the Designated Account.

14. Security Services

Security Services may individually or collectively mean EMV Support, PCI Program, and point-to-point encryption (“P2PE”), or such other service as designated by us. You may utilize P2PE products and services on select terminals using services provided wholly or partially by a third party with our support (collectively referred to as “Security Services”). You bear all risk and responsibility for conducting your own due diligence regarding the fitness of Security Services for a particular purpose and for determining compliance with the Rules Summary, the Operating Regulations, and the Laws. Accordingly, your use of Security Services is at your own risk. Our decision to offer Security Services shall not limit your duties and obligations contained in this provision or the Agreement. You acknowledge that the receipt of Security Services may require the use or upgrading of certain terminals and/or equipment or new message specifications (which shall be at your sole expense) and may not be supported on all terminals/equipment. We do not warrant or guarantee that use of the Security Services, in itself, will: (i) result in your compliance with Rules Summary, Operating Regulations, and/or Laws; (ii) prevent any and all unauthorized breaches of your terminals, systems, or facilities; or (iii) be uninterrupted or error-free. You shall not acquire any interest in (ownership, intellectual property or otherwise) any of the third-party provider software used to provide the Security Services. You shall not, and shall have no right to, own, copy, distribute, sub-lease, sub-license, assign or otherwise transfer any portion of such third-party provider software used to provide the Security Services or any materials provided by us or to modify, decompile, or reverse engineer any such software, materials, or the Services.

1. EMV Support: Europay, Mastercard, and Visa (“EMV”) is a set of global standards for credit, debit and contactless card payments. EMV chip cards help prevent in-store fraud and are nearly impossible to counterfeit. If you have not made the investment in chip-enabled technology, you may be held liable for card-present EMV acceptance requires an EMV enabled standalone terminal or POS system. We are enabled to process in-store EMV transactions to help reduce fraud liability.
2. EMV Non-Enabled Fee:  The EMV Non-Enabled Fee is effective if you do not have EMV enabled equipment and/or software. The EMV Non-Enabled Fee is determined based on the Chargeback liability risk of your MCC as determined by us. Transactions will be evaluated and assessed monthly at the MID level. This fee is based on the gross sales amount of each card present transaction.
3. Point to Point Encryption: The P2PE Service is a two-part service designed to (i) encrypt (make unreadable) Card data information at the origin of the payment transaction, which is a PCI-approved secure cryptographic device (“SCD”) that has licensed P2PE functionality that aligns with the P2PE technologies hosted by us; and (ii) decrypt card data information at the destination of the transaction, which are our data systems. You acknowledge and agree that SCD P2PE functionality is required and may require you to engage an appropriate third-party provider or authorized reseller, and said licensed functionality may incur fees in addition to those set forth herein. Card data information protected by the P2PE Service may include Track 1 or Track 2 data (i.e., Card data obtained through a Card swipe read) or PAN data (i.e., manually entered personal account number Card data) as appropriate to the type of transaction processed. The SCD functionality supporting the P2PE Service is designed to securely store or generate encryption keys which are used in conjunction with the P2PE functionality to encrypt card data at the moment that the card data is captured by the SCD. The P2PE Service applies only to transactions that were encrypted by the SCD and sent from the terminal to our authorization and settlement systems pursuant to the Agreement. Supported transactions include those associated with credit (signature), debit (signature), and debit (personal identification number, “PIN”). Our provision of P2PE Service to you is subject to the availability of the licensed encryption software from the applicable third-party provider and your compliance with the Agreement.
4. PCI Program: The Card Organizations have mandated that all merchants must comply with the PCI DSS found at pcisecuritystandards.org (see www.visa.com/cisp for additional information). We have a program to assist merchants with PCI DSS validation (“PCI Program”). Member Bank is not a party to or liable for PCI Program.
5. Benefits of PCI Program: Upon enrollment of the PCI Program, you are eligible to receive:
   
   1. Access to an online PCI Certificate validation system, where you can complete your SAQ;
   2. Access to remote scanning services, which include monthly vulnerability scanning for up to five (5) of your computer website IP addresses (additional fees apply if you have more than five IPs). This applies to PC/IP merchants only; and
   3. Access to https://123pci.pcicompliance.ws.
6. PCI Compliance Validation Process:
   
   1. Validation Requirement: In order to take full advantage of the PCI Program, you must validate your compliance with the PCI DSS on an annual basis or as otherwise required by us or a Card Organization as more fully set forth herein. To validate your compliance with the PCI DSS, you must successfully complete a SAQ and, if applicable, a vulnerability scan as provided below.
   2. Self-Assessment Questionnaire (“SAQ”): A SAQ is a list of questions developed by the PCI Security Standards Council
   3. Vulnerability:  A vulnerability scan is necessary for PC, IP enabled terminal, or integrated ECR merchants. Here are the steps to receive your Scan:
      
      • Once you have completed your SAQ, the system will guide you to schedule a Scan, if applicable.
      • The Scan will identify vulnerabilities or gaps that may allow unauthorized or malicious users to gain access to your network and potentially compromise cardholder data. The Scan does not require you to install any software, and no denial-of-service attacks will be performed.
      • Upon completion of the Scan, you will receive a link to your full compliance report. A network vulnerability review failure means that the Scan discovered areas of severe vulnerability. The report describes the issues found and provides you with recommendations for scan resources to begin fixing the problems. The tool will guide you to remediate the failed Scan and work toward achieving compliance. Once you have addressed the vulnerabilities, simply schedule a follow-up Scan to ensure your remediation of the problem meets the PCI DSS requirements.
   4. Certificate of Validation: Upon successful completion of the SAQ and Scan, if applicable, your Certificate of Validation will be issued. You can print your Certificate through our online portal or, if you have completed a paper version of the SAQ, your Certificate will be mailed to you.
   5. Re-Validation:  You must maintain a current, successfully completed SAQ and timely pass quarterly Scans, if applicable, in order to take full advantage of the PCI Program. An SAQ is no longer current if the Certificate of Validation issued by us to you is more than one (1) year old. You are also required to re-validate by completing a new SAQ and passing Scans, if applicable, when you make a change in your processing environment or if you fail to timely complete a required quarterly Scan.
      
      • A change in your processing environment requiring re-validation occurs when you transition from one card-processing environment to another such that your SAQ Classification changes, necessitating re-validation under a new SAQ. With respect to a re-validation required due to a change in your processing environment, you must complete the re-validation process within twenty-four (24) hours of such change in order to maintain your validation of compliance with the PCI DSS.
      • With respect to a re-validation required due to your failure to complete a required quarterly Scan, we will deem your failure to complete a Scan within ten (10) days of the end of the preceding quarter to require re-validation under the PCI Compliance Validation Process, in order to maintain your validation of compliance with the PCI DSS.
      • With respect to a re-validation required due to the expiration of the annual SAQ or any other reason for which Re-Validation is required, you will have five (5) days to complete the PCI Compliance Validation Process, in order to maintain your validation of compliance with the PCI DSS. Once you have successfully completed the re-validation of your PCI DSS compliance, we will issue you a new Certificate of Validation for the current validation period.
7. Costs: We may assess you a non-compliance fee if you do not validate your compliance with PCI DSS.
8. Security Policy:  As part of PCI DSS, the Card Organizations require that you have a security policy that covers the security of credit card information.
9. Amendment: The Security Services is subject to change from time to time by us. Any changes will be effective fifteen (15) days following the date notice of such change is sent to you, even if it was not received by you.
10. Further Information: To speak with our customer service representative, please call us at 1-866-849-2445.
11. Waiver: Limitations on Waiver:  Upon your successful validation of compliance with the PCI DSS under the PCI Program, we agree to waive your liability to us, up to $50,000, for the following fees and costs incurred as a result of a verified compromise of cardholder data that are otherwise your liability under this Agreement: (1) fees and costs associated with a required forensic audit conducted by an approved Qualified Incident Response Assessor (QIRA); (2) fines or assessments levied by a Card Organization as a result of the required forensic audit; and (3) fees and costs associated with the production and distribution of replacement credit cards for compromised card numbers (the “Waiver”).

1. The Waiver provided under this Section is also subject to the following:
   
   1. Our agreement to waive your liability to us for the fees and costs described in this Section is only effective upon (1) your continued validation of compliance with the PCI DSS and participation in the PCI Program; and (2) your successful completion of the PCI Compliance Validation Process described in Section 14.F. above; provided, however, that there is no change in your business practices regarding Card acceptance. Your continuing qualification for the PCI Program is premised upon initial validation of your compliance with the PCI DSS and timely re-validation of your compliance with the PCI DSS, including annual completion of a SAQ and passing quarterly vulnerability Scans, if applicable, payment of the PCI Program cost, and otherwise complying with the terms of the PCI Program and the Agreement.
   2. If you are in compliance with the requirements of subsection (i) above, we agree to waive up to $50,000 in fees and costs described in this Section for each unique MID. If you have multiple MIDs that have the same federal tax identification number (or in the case of a sole proprietorship, the same social security number), then the maximum aggregate Waiver amount for those MIDs is limited to $700,000. In addition, if a MID is one of a group of MIDs that are eligible for and receive a multi-merchant discount for the PCI Program fees, the aggregate Waiver for all MIDs in such group is $700,000.
   3. Your validation of compliance with the PCI DSS through the PCI Program is required to be eligible for the Waiver. You will not be eligible for the Waiver if your SAQ is not current, if you have not timely completed the quarterly vulnerability Scans, or if you have otherwise failed to maintain compliance with the PCI DSS through the PCI Program.
   4. The Waiver of up to $50,000 described in this Section is limited to one (1) compromise of Cardholder data incident per PCI Program year. Any subsequent incidents occurring during the same PCI Program year are not eligible for the Waiver, and any costs and fees associated with such incident(s) remain your liability under this Agreement. Chargebacks are not eligible for the Waiver under any circumstances.

15. Representations and Warranties

You represent and warrant that:

1. Information: Any information you have submitted to us is true, complete, and accurate. This includes information about your entity type, the nature of your business (e.g., products and services sold, manner of sale, etc.), and the financial condition, ownership, and executive structure of your business.
2. Corporate Power: You and any person signing the Application on your behalf have the power to execute this Agreement and to perform under this Agreement. The person signing the Application may execute any future documents and take any future action on your behalf.
3. Existence/Organization: You are a person or an entity validly existing and organized in the United States.
4. No Litigation: You have no knowledge of an actual or threatened action, suit, investigation, or proceeding against you that might impair your financial condition or prevent you from operating your business as you now conduct it. You have never appeared on Mastercard’s MATCH system or Visa’s Terminated Merchant File or any combined terminated merchant file, except as already disclosed in writing.
5. Transactions: The Card transactions you submit to us: (i) represent the obligations of the authorized Cardholder for merchandise or services actually sold, rented, or rendered (except for any delayed delivery or advance deposit authorized by the Rules) and must not involve any element of credit for any other purpose; (ii) represent bona fide Card/rentals of merchandise and/or services not previously submitted and do not represent a refinancing of any prior obligation; (iii) are not subject to any dispute, setoff, or claim against the price; (iv) are not, to your knowledge or notice, fraudulent, unauthorized by the Cardholder, or subject to any other infirmity or impairment; and (v) do not result from any sale outside your normal course of business, as described in the Application.
6. Products and Services: The following items are true: (i) you have complete power and authority to sell the products and services you offer and to display the advertisements you use; (ii) your products and services are not illegal, and you will not accept a Card for any illegal transaction; (iii) you will prominently and unequivocally inform each Cardholder of your identity at all points of interaction during the transaction to distinguish you from any other party; (iv) your products, services, and business name do not infringe upon the rights of any other person, including trademark, copyright, confidentiality, or patent rights; and (v) you will not sell, market, or display any products or services that would violate any Law or jeopardize our reputation. You shall provide to us information to support the representations regarding your products, goods, and services, including copies of your sales and marketing materials, online advertisements, proof of delivery documents for tangible goods, and proof of services provided for services. All such information shall be provided to us within three (3) business days from and in the form specified in our request.
7. Debit & EBT Card Processing Services: Availability of Terminals: We will process Debit Card transactions for you if indicated in the Application or an amendment. If you accept EBT Cards, the terms in Addendum A shall apply. We will provide sponsorship services to you (through a third party bank), if applicable. You will take all steps necessary to ensure that POS devices and PIN pads will be available for Cardholder use and will function in a reliable manner.
8. Wireless Operator: You hereby authorize your wireless operator (AT&T, Sprint, T-Mobile, US Cellular, Verizon or any other branded wireless operator) to use your mobile number, name, address, email, network status, customer type, customer role, billing type, mobile device identifiers (IMSI and IMEI) and other subscriber status details, if available, to allow verification of your identity and to compare information you have provided to us with your wireless operator account profile information for the duration of the business relationship.

16. Special Association Considerations

Rules regarding your participation in the Discover or American Express Card programs are attached as Schedule VI attached hereto.

17. Miscellaneous Terms and Conditions

1. Headings and Construction: The parties have used the headings in this Agreement for convenience only. No heading shall affect the interpretation of any Terms and Conditions, which are subordinate to the Rules Summary, the Operating Regulations, and the Application (unless the Application is blank). Our approval of the Application does not guarantee you a right to receive processing. The parties have chosen the language in this Agreement to express their mutual intent. No rule of strict construction shall operate against any party. This Agreement constitutes the entire agreement between the parties with regard to the Services and supersedes all prior or other agreements or representations regarding the Services, whether written or oral. All prior understandings have merged into this Agreement.
2. Other Rights and Acknowledgements: We may change Member Banks at any time without notifying you. Any Member Bank may delegate all or part of its duties to its affiliate at any time, also without notifying you. We are an agent of Member Bank in connection with Visa and Mastercard transactions and may use an ISO/MSP in connection with this Agreement. The ISO/MSP is an independent contractor and not our agent. Accordingly, ISO has no authority to execute an Agreement on our or Member Bank’s behalf. You owe Member Bank the same obligations you owe us. We may exercise any rights or remedies in this Agreement individually or jointly with Member Bank and may likewise exchange or allocate the duties and obligations each owes to you.
3. Attorney’s Fees: You shall pay us for all attorneys’ fees and other costs and expenses we incur or pay in: (i) defending our rights under this Agreement; (ii) enforcing the Agreement; or (iii) collecting any amounts you owe us under the Agreement. In the event of a lawsuit under this Agreement, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs.
4. Survival: Provisions that impose or could impose a continuing obligation on you shall survive the expiration or termination (for any reason) of this Agreement. This includes your liability for Chargebacks and reversals, your duty to indemnify us and Member Bank, and your duties with respect to account maintenance.
5. Association/Other Network: You may sign an agreement with an Association or Other Network ("Other Merchant Agreement"). Each Other Merchant Agreement is a separate and independent agreement. We have no responsibility for Association’s, Other Networks, or your breach of an Other Merchant Agreement. We do not have to comply with the terms or conditions of an Other Merchant Agreement. We have a right to cease providing Services for any Other Networks or Associations in our sole discretion. You agree to pay all fees, fines, assessments, and penalties the Associations or Other Networks impose. We may allocate any such fees, fines, assessments, or penalties imposed on us in any manner and in our sole discretion. You agree that all POS terminals operate with unique keys according to Network requirements.
6. Routing: You authorize us to decide where to route a Card transaction.
7. Non-Discrimination: If applicable, we and you shall abide by the requirements of 47 CFR § 60-1.4(a), 60-300.5(a) and 60-741.5(a). These regulations prohibit discrimination against qualified individuals based on their status as protected veterans or individuals with disabilities, and prohibit discrimination against all individuals based on their color, race, religion, sex, or national origin. Moreover, these regulations, if applicable, require each of us to take affirmative action to employ and advance in employment individuals without regard to race, color, religion, sex, national origin, protected veteran status or disability.
8. Title to the Services: You agree that the Services are licensed and not sold. As a result, you only acquire a nontransferable, revocable, non-exclusive right to use the Services. The right exists only during the term of the Agreement, and only for the purpose of accepting and managing payments. We retain all rights, title, and interest in and to the Services. This includes rights in materials we deliver to you, and any invention, development, product, trade name, trademark, service mark, software program, or derivative from any item just listed. You shall not: (i) copy, reproduce, alter, modify, create derivative works, publicly display, republish, upload, post, transmit, resell, or distribute any of our material; (ii) permit any third party to use or benefit from the Services through a rental, lease, timesharing, service bureau, or other arrangement; (iii) work around, bypass or circumvent any of the technical limitations of the Services, use any tool to enable disabled functionalities, or decompile, disassemble, or reverse engineer the Services (unless the restriction is prohibited by the Laws); (iv) perform any act that interferes with proper access or use of the Services; or (v) use the Services in any manner not expressly allowed under this Agreement.
9. Notices: Unless otherwise stated, you shall deliver notices and other communications in writing via certified mail or reputable overnight courier (postage prepaid) to the following address: Luqra, Attention: Legal, 4100 Newport Place Drive, Suite 500; Newport Beach, CA Notices delivered in this manner become effective upon our actual receipt. Our communications to you shall be delivered via email, facsimile (effective upon transmission confirmation), ordinary or certified mail (effective the seventh day after mailing), reputable overnight courier (effective the first day after submission to the courier), or via a report, communication via Portal Service or invoice (effective when made available).
10. No Obligation to Process: We have no obligation to process any Visa or Mastercard transaction beyond the authority of a U.S. member of Visa and Mastercard or any Discover or American Express transaction outside the United States and other United States territories.
11. Account Debiting Authorization: In addition to our other collection rights in this Agreement, you expressly authorize us or our affiliate to collect amounts due us or our affiliate by debiting any deposit account you maintain or have on file with us or Member Bank.
12. Amendments: We may amend this Agreement or change rates at any time. You do not have the same right. We will provide notice of changes in accordance with the notice Section of this Agreement. If you continue to process transactions after, or fail to notify us that you contest a change within seven days of actual or constructive notice, you will be deemed to have accepted that change. We have the right to make Association and Other Network changes and increases in interchange, fees, or assessments without providing you notice. You agree to pay these increased fees and charges throughout the term. We are not bound by any changes, additions, or deletions you make to the Agreement unless they are part of a written amendment that is signed by you and us. Notwithstanding anything in this Agreement to the contrary, we reserve the right to correct minor typographical or other errors that do not affect the material content of this Agreement without recourse.
13. Assignment: We have a right to assign this Agreement. Unless you obtain our prior written consent, you do not. This means that any assignment, even an assignment by operation of law, is prohibited without our consent. This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, executors, administrators, successors, transferees, and assignees (if applicable). If you assign this Agreement without our consent, the assignee will be bound by the terms of this Agreement, and we reserve the right to pursue remedies for an Event of Default as set forth in herein. Your sale of the business does not relieve the original owner or original Guarantors of Chargeback or other liabilities, even those occurring after sale.
14. Independent Contractors: We are not your agent, and we are not in a joint venture, or partnership with you (or vice-versa). We and you are independent contractors.
15. No Third-Party Beneficiary: Unless expressly stated in these Terms and Conditions, this Agreement is for the benefit of, and may be enforced by, only you and us, and our successors and permitted transferees and assigns. It is not for the benefit of any third-party.
16. Employee and Agent Actions: You are responsible for the acts or omissions of your employees, independent contractors, and agents related to this Agreement and the use of the Services.
17. Severability and Non-Waiver: The invalidity or illegality of any part of this Agreement shall not invalidate the rest of the Agreement. The Agreement shall instead be construed as if the invalid or illegal provision were not part of the Agreement. Our delay or failure to exercise any right under this Agreement shall not operate as a waiver or estoppel of that right.
18. Signature: An original, a copy, facsimile copy, or digital, photographic or electronic copy of your signature serves as the signature for this Agreement. Further, duplicate original records of this Agreement (digital, photographic, or otherwise) have the same force and effect as the original. The parties agree that contracting through electronic means including e-signature or "click to agree" processes is an acceptable form of showing and proving mutual assent to this Agreement.

18. Additional Definitions

The following terms shall have the meaning specific below when used in this Agreement. Certain other capitalized terms are defined elsewhere in this Agreement in the context of the provision in which they are used.

1. “ACH” means an electronic funds transfer processed through one of the automated clearing house systems and subject to the Nacha Network Rules.

   “Agreement” means the Merchant Processing Agreement (including Terms and Conditions), Merchant Application, Rules Summary, Operating Regulations, and any attached addenda, exhibits, schedules, or other documents.

   “Application” and “Merchant Application” mean either the physical/virtual form or the act of making an application by providing information via a web page user interface to obtain Service from us.

   “Associations” means, collectively, Mastercard, Inc. (“Mastercard”), Visa, Inc. (“Visa”), Discover Financial Services (“Discover”), and American Express Company (“American Express”), each including its applicable affiliates and payment networks, and certain similar entities.

   “Card(s)” means Association or Other Network branded cards that enable consumers to purchase goods and services from Merchants.

   “Cardholder(s)” means persons authorized to use Association or Network branded cards.

   "Change in Control" means the consummation by Merchant of a transaction or series of transactions in which any one or more of the following occurs: (1) any person becomes the beneficial owner, directly or indirectly, of 25% or more of Merchant’s business; (2) the sale, lease, exchange, or other disposition of 25% or more of all of Merchant’s consolidated assets; or (3) a complete liquidation or dissolution or a plan of complete liquidation or dissolution of Merchant.

   "Chargeback" means a Transaction for which payment has been refused or reversed in accordance with the Operating Regulations. The term also means, where appropriate, a Card reject or any other credit or return initiated by a Merchant’s customer or Card issuing bank.

   "Discount Rate" means a percentage of the total transactions submitted to Member Bank for processing.

   "Effective Date" means the later of (i) the date you signed the Application; or (ii) the date we approved the Application.

   "ISO/MSP" means an independent sales organization/member service provider operating under the Operating Regulations.

   "Laws" means all applicable state, federal, and local laws, rules, and regulations.

   "Member Bank" means a member of Visa, Mastercard and/or Other Networks, as applicable, that provides sponsorship services in connection with this Agreement.

   "Operating Regulations" means the Association and Network bylaws, operating regulations, rules, policies and procedures. The Operating Regulations may be changed or updated from time to time without notice.

   "Other Networks" or "Networks" means, collectively, all our supported payments networks not defined above as Associations.

   "Rules Summary" means the document containing a summary of key Operating Regulations governing this Agreement as amended from time to time. In case of a conflict between the Rules Summary and the Operating Regulations, the Operating Regulations control.

   "Service" means any services described in this Agreement and/or provided by us.

Exhibit A - Rules Summary

All capitalized terms not defined below will have the meanings ascribed in the Bank Card Merchant Agreement/Merchant Processing Agreement.

Good Business Practices That Will Help You Reduce Your Processing Costs

• Use an imprinted sales ticket with a signature for all “key entered” transactions. This will assist you with issues such as chargebacks.
• Close and settle your sales transactions daily. This will help reduce those instances where “Mid-Qualified” or “Non-Qualified” discount rates are assessed.
• Balance your Merchant Account, processing statements from Processor, Member Bank, Associations, and Third-Party Service Providers, and your sales slips to assure that you are receiving anticipated funds in a timely fashion, as more fully described below. Because of the number of parties involved in the processing of credit card and other electronic transactions, the only way to ensure that you receive all funds is by balancing each day’s sales tickets against daily ACH deposits.
• Respond within the acceptable time frame to retrievals and/or chargebacks to ensure the most favorable outcome possible.
• Do not call the voice authorization center for services other than authorization.
• Settle disputes with your customers before they reach “chargeback” status. A chargeback is like a returned check; it is expensive and time-consuming.
• Read your Merchant Processing Agreement and these Rules closely and thoroughly.
• Shipping products overseas without a card present should be closely monitored. The merchant has little ability to prevent a chargeback in this type of situation.
• You should carefully reconcile sales tickets against deposits daily, particularly in the following situations: installation of new equipment, new downloads, adding new products to your terminal, power outages, changes in your Merchant Account.

1. Honoring Cards

1. You shall honor all Cards when presented in accordance with these Rules for the purchase of goods or services or in processing a request for credit resulting from such a transaction, by an authorized holder of a Card without imposing any special conditions not required by any Rules. However, if you do not deal with the public at large (for example, if your business is a private club), you are required to honor a valid Card only if presented by a cardholder who has purchasing privileges or a membership with you. You may attempt to steer customers who initially present a Card to an alternative method of payment, such as by providing discounts for cash, but you may not do so in a confusing manner that denies consumer choice. You may also consider whether present circumstances create undue risk, for example, if the sale involves high-value electronics, but the card signature panel is not signed, and the Cardholder does not have any other identification.
2. Cardholder Identification:You will identify the Cardholder and check the expiration date and signature on each Card. You will not honor any Card if: (i) the Card has expired; (ii) the signature on the Sales Draft does not correspond with the signature on the Card; or (iii) the account number embossed on the Card does not match the account number on the Card’s magnetic stripe (as printed in electronic form) or the account number is listed on a current Electronic Warning Bulletin file. Unless permitted or required under the Laws and Rules, you will not require a Cardholder to provide personal information, such as a home or business telephone number, a home or business address, or a driver’s license number, as a condition of honoring a Card.
3. Responsibility for Transactions: Merchant is responsible for ensuring that the Cardholder understands that the Merchant is responsible for the transaction, including goods or services included as part of the transaction, and for related customer service, dispute resolution, and performance of the terms and conditions of the transaction. A Merchant must prominently and unequivocally inform the Cardholder of the identity of the Merchant and all actions so that the Cardholder readily can distinguish the Merchant from any other entity such as a supplier of goods or services.
4. Card Recovery: You will use your reasonable, best efforts to recover any Card: (i) on Visa Cards, if the printed four digits above the embossed account number do not match the first four digits of the embossed account number; (ii) if you are advised by Member Bank (or its designee), the issuer of the Card or the designated voice authorization center to retain it; (iii) if you have reasonable grounds to believe the Card is counterfeit, fraudulent or stolen, or not authorized by the Cardholder; or (iv) for Mastercard Cards, the embossed account number, indent printed account number and/or encoded account number do not agree, or the Card does not have a Mastercard hologram on the lower right corner of the Card face. This obligation upon you in no way authorizes a breach of the peace or any injury to persons or property, and you will hold Processor or Member Bank harmless from any claim arising from any injury to person or property or other breach of peace.
5. Return Policy: You will properly disclose to the Cardholder, at the time of the transaction and in accordance with the Rules, any limitation you have on accepting returned merchandise.
6. No Claim Against Cardholder: You will not have any claim against, or right to receive payment from a Cardholder unless Member Bank or Processor refuses to accept the Sales Draft or revokes its prior acceptance of the Sales Draft (after receipt of a chargeback or otherwise). You will not accept any payments from a Cardholder relating to previous charges for merchandise or services included in a Sales Draft, and if you receive such payment, you will promptly remit them to Member Bank. You may not reimburse a Cardholder in cash or check for any transaction.
7. Disputes With Cardholders: You must ensure that the Cardholder understands that you are responsible for the transaction, for any related customer service, dispute resolution, and performance of the terms and conditions of the All Disputes between you and any Cardholder relating to any transaction will be settled between you and the Cardholder. Neither Processor nor Member Bank bears any responsibility for such transactions. You shall not require a Cardholder to waive his or her rights to dispute the transaction as a condition of the sale.
8. Employee Actions:You are responsible for your employees’ actions while in your employ.
9. Prohibitions on Card: You shall not: (i) submit for payment into interchange any transaction that is illegal or that you should have known was illegal; (ii) require a Cardholder to complete a postcard or similar device that includes the Cardholder’s account number, expiration, signature or any other account-related data in plain view when mailed; (iii) add any tax to a transaction, unless applicable law expressly requires you to impose a tax, and in such event the tax amount must be included in the transaction amount and not collected separately; (iv) request or use an account number for any purpose other than as payment for goods or services, except as permitted by the Rules; (v) disburse funds in the form of travelers cheques, if the sole purpose is to allow cardholder to make a cash purchase of goods or services from you; (vi) permit a Cardholder to purchase travelers cheques, or other similar item, if the sole purpose is to allow the Cardholder to make a cash purchase of goods or services from Merchant; (vii) accept a Card to collect or refinance an existing debt that has been deemed uncollectible; (viii) enter into interchange a transaction that represents collection of a dishonored check; (ix) require a Cardholder to waive his/her rights to dispute a transaction as a condition of sale; (x) accept Cardholder payments for previous Card charges incurred at the Merchant location; (xi) submit for payment into interchange any transaction that may in the sole discretion of a Card Organization, damage the goodwill of such Card Organization or reflect negatively on a Card Organization’s brands; (xii) add any surcharge to a transaction; (xiii) enter into interchange any transaction for a transaction that was previously charged back to Member Bank and subsequently returned to you, irrespective of Cardholder approval (you may pursue payment from the customer outside of the Card Organization system); (xiv) accept a Card for the purchase of Scrip; (xv) accept a Visa Electron Card or a Visa TravelMoney Card for manual cash disbursement; and/or (xvi) redeem a Visa Prepaid Card for cash. You may establish a minimum sale amount as a condition for honoring Cards, provided that the minimum transaction amount does not differentiate between Card Organizations and/or issuers and the minimum transaction amount does not exceed $70.00 (or any higher amount established by applicable law or the Rules). Unless otherwise set forth below or otherwise allowed by applicable law or the Rules, you may not establish a maximum sale amount as a condition for honoring Cards. You may establish a maximum sale amount as a condition for honoring Cards if you are a department, agency or instrumentality of the U.S. Government, a corporation owned or controlled by the U.S. Government, or your primary business is reflected by one of the following MCCs: 8220 (Colleges, Universities, Professional Schools and Junior Colleges), 8244 (Schools, Business and Secretarial), or 8249 (Schools, Trade and Vocational), provided that the maximum transaction amount does not differentiate between Card Organizations and/or issuers.
10. Security Features: You are required to examine the Card security features prior to completing a sale. You should examine the Card to be sure there has been no tampering to the signature panel. Specific Card security features are as follows:
    
    1. Visa:
       
       1. The “DOVE” hologram should appear to fly when tilted
       2. All Visa account numbers begin with a “4” and can be up to 79 digits long.
       3. The first four digits of the embossed account number match the four digits printed on the account number of the Card.
       4. The “V” to the right of the expiration date should be a special letter (a “Flying V” not a normal “V”). The “DOVE” hologram should appear to fly when tilted.
    2. MasterCard:
       
       1. The MasterCard Global hologram or the Debit MasterCard hologram and the MasterCard brand mark stacked within a retaining line, or the MasterCard brandmark without a retaining line if the hologram is on the back.
       2. All MasterCard account numbers are 76 digits long.
       3. The first four digits of the embossed account number match the four digits printed on the account number of the Card. The last four digits of the account number are embossed over the hologram.
    3. Discover Network: (certain valid devices (e.g., radio frequency enabled Cards, key fobs, contactless Cards, and JCB, CUP and DCI Cards) may not display the features described below).
       
       1. Card numbers are at least 76 digits embossed on the front of the Card.
       2. The word DISCOVER or DISCOVER NETWORK will appear in ultraviolet ink on the front of the Card when it is held under an ultraviolet light.
       3. An overprint on the signature panel reads Discover Network.
       4. The Discover Network three-dimensional hologram, bearing a distinct circular shape and images of a globe pierced by an arrow, water and stars on a repetitive pattern background (“Discover Network Hologram”), appears on the front of certain Discover Network Cards. The hologram reflects light and appears to move as the Card is rotated.

1. 1. When an Electronic Cash Register or Electronic Draft Capture terminal reads the magnetic stripe on the Card, you must check the Card account number on the terminal (if displayed) against the account number embossed on the Card or follow other security checks mandated by the Processor from time to time. If the Card is read with a terminal that displays the Card number and the Sales Draft is printed, verify that the account number displayed on the terminal and the printed card numbers on the Sales Draft match the embossed numbers on the Card. If they do not match, the sale must not be completed. Failure to follow these checks and procedures exposes you to chargebacks. If the terminal requires you to key the last four or more digits of each Card used for a sale, and the terminal indicates that the numbers keyed are not the same as those present on the Card, the sale must not be completed.

11. Advertising: You must display Visa, MasterCard, Discover Network and any other applicable Card issuer, Debit Network and EBT Network decals and program marks on promotional materials that Processor furnishes, including, if applicable, the JCB, CUP, DCI and/or Electron symbol, in equal prominence near the point-of-sale devices and as otherwise required by the Rules. Your use of the promotional materials of Visa, MasterCard, Discover Network or any other Association or State will not indicate, directly or indirectly, that Visa, MasterCard, Discover Network or any other Association or State endorse any goods or services other than their own and you may not refer to Visa, MasterCard, Discover Network or any other Association or State in stating eligibility for your products or services.
12. Acceptance Procedures: You may ask or incentivize your customers to use alternative forms of payment other than Visa or MasterCard. Discounts can be offered on alternate card brands, card types, or payment types. Card brand or payment method preference can be promoted, as well as the ability to inform your customers of the costs associated with accepting a particular card type or brand.
    
    1. MasterCard Specific Requirements: You may request or encourage a customer to use a payment card with an acceptance brand other than MasterCard or other form of payment or a Card of a different product type (e.g., traditional cards, premium cards, rewards cards) than the Card the consumer initially presents. You may do so by methods that include, but are not limited to:
       
       1. Offering the customer an immediate discount from your list, stated, or standard price, a rebate, a free or discounted product or service, or any other incentive or benefit if the customer uses a particular payment card with an acceptance brand other than MasterCard or another particular form of payment;
       2. Offering the customer an immediate discount from your list, stated, or standard price, a rebate, a free or discounted product or service, or any other incentive or benefit if the customer, who initially presents a MasterCard, instead uses another payment card or another form of payment;
       3. Expressing a preference for the use of a particular payment card or form of payment;
       4. Promoting the use of a particular general-purpose payment card with an acceptance brand other than MasterCard, or the use of a particular form or forms of payment through posted information, through the size, prominence, or sequencing of payment choices, or through other communications to customers (provided that merchants will abide by the MasterCard trademark standards relating to the display of its marks); or
       5. Communicating to customers the reasonably estimated or actual costs incurred by you when a customer uses particular payment cards or forms of payment, or the relative costs of using different general-purpose payment cards or forms of payment.

    You are free to engage in the POS practices described above, or any other substantially equivalent practices.

    2. Visa Specific Requirements: You may steer customers to use a particular network brand, such as Visa or MasterCard, to a type of payment card, such as a “non-reward” credit card, or to another preferred form of payment. You may also encourage a customer who initially presents a Visa card to use a payment card with a different network brand, a different type of payment card, or a different form of payment. You may engage in any of the following steering activities:
       
       1. Offering a customer a discount or rebate, including an immediate discount or rebate at the point of sale;
       2. Offering a free or discounted product;
       3. Offering a free or discounted or enhanced service;
       4. Offering the customer an incentive, encouragement, or benefit;
       5. Expressing a preference for the use of a particular brand or type of general-purpose card or a particular form of payment;
       6. Promoting a particular brand or type of general-purpose card or a particular form or forms of payment through promoting a particular brand or type of general-purpose card or a particular form or forms of payment through posted information, through the size, prominence, or sequencing of payment choices, or through other communications to customers;
       7. Communicating to a customer the reasonably estimated or actual costs incurred by the merchant when a customer uses a particular brand or type of general-purpose card or a particular form of payment or the relative costs of using;
       8. Engaging in any other practices substantially equivalent to these.

    You are not required to display the Visa mark in a size as large as other payments marks. You may promote acceptance brands other than Visa through the size, prominence, or sequencing of payment choices. However, you must continue to respect a cardholder’s ultimate decision to pay with Visa; you still have an obligation to accept for payment properly presented Visa cards, including rewards cards. In addition, surcharging of Visa cards and steering among Visa cards based on the issuing bank are not permitted, and you must ensure that your steering practices are not performed in a confusing manner.

    3. American Express Specific Requirements: If you accept American Express cards, you must comply with the American Express rules regarding card acceptance. You should review your agreement with American Express for further details on the requirements for American Express card acceptance.

2. Authorization

1. Required on all Transactions: You will obtain prior authorization via electronic terminal or similar device before completing any transaction, including MO/TO transactions. You will follow any instructions received during the authorization process. Upon receipt of authorization, you may consummate the authorized transaction and must note the authorization number on the Sales Draft. Where authorization is obtained, you will be deemed to warrant the true identity of the customer as the Cardholder. If you receive a negative authorization response, you may not complete the sale and may be requested to recover the Card if you can do so by reasonable and peaceful means. If you do recover the Card, you should notify the voice authorization center and ask for further instructions. Transactions will be deemed invalid on Cards that are expired, regardless of whether an authorization has been obtained. For electronic commerce transactions, you must attempt to obtain the Card expiration date and forward it as part of the authorization request. You may not, after receiving a negative response or decline on an authorization request, split the sale amount into multiple transactions to obtain a valid authorization for each one, so that the separate transactions total the original dollar amount of the sale.
2. Effect: Authorizations are not a guarantee of acceptance or payment of the Card transaction and will not waive any provision of this Agreement or otherwise validate a fraudulent transaction or a transaction involving the use of an expired Card. Obtaining an authorization will not assure payment to you for a Card transaction. The fact that an authorization is obtained by you will not affect Processor’s or Member Bank’s right thereafter to revoke the authorization of a Card transaction or to charge back the transaction to you. In no event will the fact that an authorization is obtained by you be deemed Processor’s or Member Bank’s representation or warranty, either express or implied, that the particular Card transaction is in fact a valid, authorized, or undisputed transaction entered into by the Cardholder.
3. Unreadable Magnetic Stripes: If you authorize and present Card transactions electronically and your terminal is unable to read the magnetic stripe on the Card, you will obtain an imprint of the Card and the Cardholder’s signature on the imprinted draft before presenting the Sales Draft to Member Bank and Processor for processing.
4. Procedures: If an unsigned Card is presented at the point of sale, you must request that the Cardholder provide proof of identification and sign the card before completing the sale. Details of the identification provided must be placed on the Sales Draft unless prohibited by local law. If the Cardholder refuses to do so, the sale must not be completed. In any of the following cases, you shall obtain authorization from the voice authorization center, designated or approved by Processor or Member Bank, before completing a sales transaction:
   
   1. paper merchants whose sales exceed your floor limit as established by Processor or Member Bank, or amended from time to time;
   2. an unsigned Card is presented;
   3. if you believe the Card may be counterfeit or stolen or that the sale is in some other manner suspicious or unusual, you should state to the voice authorization clerk, ‘This is a Code 10″ and await further instruction; or
   4. in any other circumstances established by Processor or Member Bank or stated in the Rules and/or this Agreement.
5. If you are approved to utilize batch authorization by Processor, you may obtain batch authorization for certain sales after such sales have occurred provided, however, that authorization for each transaction is obtained by end of the calendar day upon which such sale was initiated and that you do not presort the batch by account number or BIN. Further, you explicitly agree that you will be responsible for any fines, fees, chargebacks, assessments, and declined or disputed transactions that may result from using a batch authorization process.

3. Sales Drafts

1. Forms: You will use a sales draft (“Sales Draft”) to document each Card transaction. Each Sales Draft will be legibly imprinted with: (i) Merchant’s name, identification number, and city and state; (ii) the information embossed on the Card presented by the Cardholder (either electronically or manually); (iii) the date of the transaction; (iv) a brief description of the goods or services involved; (v) the transaction authorization number; (vi) the total amount of the sale (including any applicable taxes) or credit transaction; and (vii) adjacent to the signature line, a notation that all sales are final, if applicable. If you use an electronic terminal to print Sales Drafts, the account number must be truncated on the cardholder copy of the Sales Draft. This means that only the last 4 digits of the account number may appear. The entire expiration date must be suppressed on receipts provided to cardholders.
2. Signatures: Sales Drafts must be signed by the Cardholder. The requirement for the Cardholder’s signature on the Sales Draft will only be waived if the Card transaction is a valid MO/TO or electronic commerce card transaction, which fully complies with the requirements set forth in this Agreement, or if otherwise permitted by the Rules.
3. Delivery and Retention of Sales Drafts: You will deliver a complete and legible copy of the Sales Draft or credit voucher to the Cardholder at the time of the transaction. You shall store all Sales Drafts and transaction records in a limited access area for at least one (1) year after the date of sales. You will retain the Merchant copy of the Sales Draft or credit memorandum for at least 12 months following the date of completion of the transaction for Visa Card transactions, at least 18 months following the date of completion of the transaction for MasterCard Card transactions and at least three (3) years following the date of completion of the transaction for Discover Network Card transactions (or such longer period as the Rules may require), and documentation must be maintained in a secure manner in accordance with your obligations under the Bank Card Merchant Agreement. You will submit to Processor or Member Bank a legible copy of a Sales Draft if any Card issuer requests such retrieval. The time for providing Processor or Member Bank a legible copy of the requested Sales Draft will be ten (10) days after your receipt of issuer’s retrieval request, as specified in the notice from Processor or Member Bank. Unless specifically permitted by Processor, any products purchased must be delivered to Cardholder at the time of sale. You shall not disclose a Cardholder’s account number or personal information to third parties other than your agents for the purpose of completing the transaction, and as permitted by the Laws or by the Rules.
4. Electronic Transmission: If you utilize electronic authorization and/or data capture services, you will enter the data related to a sales or credit transaction into a computer terminal or magnetic stripe reading terminal no later than the close of business on the date the transaction is completed. If you provide your own electronic terminal or similar device, such terminals must meet Processor’s requirements for processing transactions. Information regarding a sales or credit transaction transmitted with a computer or magnetic stripe reading terminal will be transmitted by you to Processor or its agent in the form Processor from time to time specifies or as required under the Laws or Rules. If Member Bank or Processor requests a copy of a Sales Draft, credit voucher, or other transaction evidence, you will provide it within three (3) business days following the request. If your terminal cannot successfully read the magnetic stripe, you must imprint the Card, even if it is a key entered transaction. You must imprint the Card on the same Sales Draft containing the remainder of the transaction information and the Cardholder signature. Failure to obtain a signed and imprinted Sales Draft when a transaction is not captured by swiping through a magnetic stripe reader will expose you to a chargeback regardless of the authorization that may or may not be received. Failure to read the magnetic stripe on the Card may result in a discount rate tier downgrade.
5. Daily Settlement of Transactions: You must Batch Out each POS terminal every day. Failure to Batch Out daily will delay the deposit of funds. “Batch Out” is the process by which you total and settle all transactions, on each POS terminal, which occurred before midnight (12:00 a.m.) and transmit the information to Processor. In all cases, Merchant must present the record within three (3) business days (two (2) business days for Electron Cards) after the transaction date, unless otherwise permitted by the Rules. Transactions contained in an untimely Batch Out may be refused, held for a 180-day period, become subject to chargeback or be transferred to a Reserve Account and held in accordance with the terms of the Bank Card Merchant Agreement. Merchant is responsible for resubmitting a Batch Out or ticket if the POS terminal fails to properly Batch Out or if the Batch Out data does not process through the normal payment cycle. Processor is not liable to Merchant for amounts it did not collect, including but not limited to amounts collected by Third Party Service Providers.

4. Chargebacks

1. Failure to comply with the Rules will reduce Processor or Member Bank’s ability to reverse chargebacks and increase the likelihood of your receiving a chargeback. You may be subject to a chargeback on sales for a minimum period of 180 days from the date the sale was entered into the Association’s processing system. Processor may hold funds from your account to cover any chargebacks for the later of: (i) 270 days after the termination of this Agreement; (ii) 180 days after the last Card processing activity under this Agreement; or (iii) the conclusion of any pending criminal, civil, administrative, or regulatory investigation or litigation. Processor or Member Bank will mail or otherwise deliver all chargeback documentation to the address provided by you. You agree to respond promptly to all chargebacks. If Processor or Member Bank elects, at its discretion, to take action on chargebacks after the Association time limits have expired, such action shall be done at an additional cost. You will not redeposit sales that have been previously charged back and not represented. This restriction applies whether or not the Cardholder consents to such activity. If you receive a chargeback for an international Cardholder, you are responsible for any currency conversion differences in the dollar amount. You will be charged the fee indicated on the Merchant Application for each chargeback.

5. Chargeback Reasons

1. Summary: The summary of reasons for chargebacks include, but are not limited to, anyone of the following:
   
   1. An invalid Card account number submitted by you;
   2. Neither the Cardholder nor a person authorized by the Cardholder received the goods or services requested;
   3. The Cardholder never received the good or service;
   4. The Cardholder received the good or service but disputes the quality;
   5. The Cardholder never received credit for a returned item or a canceled order;
   6. The Cardholder was charged incorrectly;
   7. The amount of the sale exceeded the floor limit and an authorization was not obtained or was denied;
   8. The sale was authorized but not for the correct amount;
   9. The authorization code provided is invalid;
   10. The Card was expired at the time of the sale or had not reached its effective date;
   11. The Sales Draft was not signed. An exception will be made where MO/TO sales are permitted by Processor;
   12. The Card issuer has information that a Merchant fraud has occurred;
   13. The Card account number and the amount of sale is missing from Sales Draft or is illegible;
   14. The Sales Draft bears the imprint of a Card which to the Associations is a counterfeit Card because the Card is not embossed in accordance with the standards set forth in the Rules, even if the sale was authorized.

6. Chargeback Monitoring Programs

1. If you exceed a 7% chargeback-to-interchange ratio for all incoming chargebacks, you are considered an excessive chargeback merchant and may be subject to a Card Organization’s monitoring programs. You are responsible for monitoring your monthly chargeback percentage and developing chargeback reduction plans as required by the Card Organizations. Excessive chargeback activity for an unreasonable period may result in the termination of this Agreement. You must pay Member Bank or Processor for any fine or charge levied by the Associations on Member Bank, Processor, or Merchant due to your chargeback activity. This section may be amended from time to time as a result of action by the Associations.
2. Other Monitoring Programs: : If you are identified by certain Association monitoring programs, Processor or Member Bank’s ability to reverse chargebacks may be severely restricted. Certain monitoring programs review the number of lost, stolen, and counterfeit Cards accepted by you in the normal course of business and the percentage of Cards used for sales that were not read electronically by terminals or Electronic Cash Registers. The purpose of these programs is to reduce the use of lost, stolen, fraudulent, and counterfeit Cards. If you are identified under these programs as exceeding the acceptable threshold value of such Cards, you may become liable for chargebacks and sales on lost, stolen, or counterfeit Cards regardless of the Card acceptance procedures followed, and this Agreement may be terminated by Processor or Member Bank and/or Processor or Member Bank may immediately cease providing services to Merchant without notice.
3. Excessive: Your presentation to Processor of Excessive Activity will be a breach of this Agreement and cause for immediate termination. “Excessive Activity” means, during any monthly period for any of Merchant’s terminal identification numbers or merchant identification numbers: (i) the dollar amount of chargebacks and retrieval requests exceeds 7% of the average monthly dollar amount or number of Card transactions; (ii) sales activity that exceeds by 25% or more the dollar volume indicated on the Merchant Application; or (iii) the dollar amount of returns equals 3% of the average monthly dollar amount of Card transactions. You authorize, upon the occurrence of Excessive Activity, us or Member Bank to take any action deemed necessary including but not limited to suspension or termination of processing privileges or creation or maintenance of a Reserve Account in accordance with this Agreement.

7. Credits

1. Credit Memoranda: You will issue a credit memorandum instead of making a cash advance, disbursement, or cash refund on any Card transaction. Member Bank will debit the Merchant Account for the total face amount of each credit memorandum submitted to Processor. You will not submit a credit relating to any Sales Draft not originally submitted to Processor, nor will you submit a credit that exceeds the amount of the original Sales Draft. You will, within the time period specified by applicable law, provide Processor with a credit memorandum or credit statement for every return of goods or forgiveness of debt for services which were the subject of a Card transaction.
2. Revocation of Credit: Member Bank or Processor may refuse to accept any Sales Draft or revoke its prior acceptance of a Sales Draft in the following circumstances: (i) the transaction giving rise to the Sales Draft was not made in compliance with this Agreement, the Laws and the Rules; (ii) the Cardholder disputes his/her liability to Member Bank for any reason, including but not limited to those chargeback rights enumerated in the Rules; or (iii) the transaction giving rise to the Sales Draft was not directly between you and the Cardholder. You will pay Member Bank or Processor, as appropriate, any amounts previously credited to you for a Sales Draft not accepted by Member Bank or Processor or, where accepted, is subsequently revoked.
3. Returns: If you agree to credit a Cardholder for any merchandise or service that was the subject of a sale, you must provide a Credit Transaction Receipt using the same Card as in the original sale. Such credit shall not exceed the original sale. You shall not make any cash refund on sales. You may limit the acceptance of returned merchandise or establish a policy to make price adjustments for any sale provided proper disclosure is made and purchased goods are delivered to the Cardholder at the time of the sale. Proper disclosure means the words “NO REFUND,” “EXCHANGE ONLY,” or “IN-STORE CREDIT ONLY” are printed in large letters near the signature line on all copies of the Sales Draft prior to obtaining the Cardholder’s signature on the Sales Draft. You may stipulate other special circumstances or terms of the sale on the Sales Draft. For each credit transaction, you must be able to provide Processor or Member Bank with evidence of the original purchase.
4. Fraud and Factoring:  You agree that, except as otherwise specified herein or permitted by Processor, you will use the services provided by Processor solely for your own internal and proper business purposes. You will not resell, directly or indirectly, any portion of the services to any third party. Transactions deposited must directly result from Cardholder transactions at your merchant locations. Do not deposit transactions resulting from any Card transaction between a Cardholder and another entity (except for Payment Service Providers (PSPs) depositing transactions from a transaction between a Cardholder and a Sponsored Merchant of the PSP). Do not present for processing or credit any transaction not originated directly between you and a Cardholder, or any transaction you know or should know is fraudulent or unauthorized. Fraudulent transactions will be referred to law enforcement. Do not sell or disclose Card account information to third parties, except as required to perform your obligations under this Agreement. Do not deposit any Sales Draft representing the refinancing of an existing Cardholder obligation. Processor and Member Bank may establish and maintain a Reserve Account, and suspend disbursement of Sales Draft funds for investigation of suspicious or unusual activity. Upon completion of the investigation, Processor may transfer funds to a Reserve Account. Processor and Member Bank are not liable for losses due to suspension of funds disbursement. Engaging in the aforementioned activities may result in research fees and termination of this Agreement.

8. Other Types of Transactions

1. Mail Order and Telephone Order. You may not solicit or accept mail orders, telephone orders, or any transaction in which the Cardholder and Card are not present ("MO/TO") without prior written authorization. MO/TO transactions completed without prior written consent of Processor or Member Bank will be a breach of this Agreement and an Event of Default, causing immediate termination in addition to other remedies available under the Laws and Rules. You may be required to use an address verification service ("AVS") on MO/TO transactions and are encouraged to use AVS even if not required. AVS is not a guarantee of payment and does not waive any provision of this Agreement or validate a fraudulent transaction. You will obtain the expiration date of the Card for a MO/TO transaction and submit the expiration date when obtaining authorization of the Card transaction. For MO/TO transactions, you will type or print legibly on the signature line of the Sales Draft the following applicable words or letters: mail order or "MO" or telephone order or "TO". If specifically authorized by Processor or Member Bank to accept MO/TO sales, no sale shall be submitted for processing before shipping the product or providing the services purchased by the Cardholder. If you supply goods and/or services under a preauthorization order, you shall not charge a Cardholder for goods after receiving notice from a Cardholder that the authorization for goods or services is canceled. The shipping documents indicating the address the goods were shipped to and a signature of an individual (even Cardholder) will not normally be sufficient to reverse an unauthorized purchaser reason code. You assume the risk associated with accepting MO/TO sales transactions.
2. Recurring/Quasi Cash:  You may not accept transactions where the goods or services are performed periodically without Processor's consent. If you receive such consent, you must obtain a written request from the Cardholder for such goods and services to be charged to the Cardholder's account, the frequency of the recurring charge, and the duration of time during which such charges may be made. You will not complete any recurring transaction after receiving: (i) a cancellation notice from the Cardholder; (ii) notice from Processor or Member Bank indicating that you may not accept such a transaction; or (iii) a response that the Card is not to be honored. You must print legibly on the Sales Draft the words "Recurring Transaction". You shall not accept sales for processing that are classified as "Quasi Cash Transactions" including but not limited to the sale of casino gaming chips, money orders, opening deposits on financial or other accounts, wire transfer money orders, or the issuance of scrip. You shall not accept a Card or use a Visa and MasterCard processing terminal to issue scrip exchangeable for cash, products, or services as a result of a sale. You must not submit for payment into interchange any transaction that represents the refinancing or transfer of an existing Cardholder obligation that is deemed to be uncollectible, or that arises from the dishonor of a cardholder's personal check.
3. Multiple Sales Drafts: You will include a description and total amount of goods and services purchased in a single sales transaction on a single Sales Draft or transaction record, unless: (i) partial payment is entered on the Sales Draft or transaction record and the balance of the transaction amount is paid in cash or by check at the time of the transaction; or (ii) a Sales Draft represents an advance deposit in a Card transaction completed in accordance with this Agreement and the Rules. If the total amount of both Sales Drafts exceeds the floor limit, authorization must be obtained. The use of multiple Cards for one purchase is permissible as long as an individual Sales Draft is used for each Card. The use of multiple sales on one Card for one purchase is not permitted.
4. Deposits:
   
   1. Prior Consent: You will not accept payment by Card for any amount representing a deposit or partial payment for goods or services to be delivered in the future without the prior written consent of Processor. The acceptance of a Card for payment or partial payment of goods or services to be delivered in the future without prior consent will be deemed a breach of this Agreement and cause for immediate termination in addition to any other remedies available under the Laws or Rules.
   2. Acceptance: If you have obtained prior written consent, then you will complete such Card transactions in accordance with this Agreement, the Rules, and the Laws. Cardholders must execute one Sales Draft upon making a deposit with a Card and a second Sales Draft upon paying the balance. You will note upon the Sales Draft the words "deposit" or "balance" as appropriate. You will not deposit the Sales Draft labeled "balance" until the goods have been delivered to Cardholder or you have fully performed the services.
5. Future Delivery:  You will not present any Sales Draft or other memorandum to Member Bank or Processor for processing (whether by electronic means or otherwise) which relates to the sale of goods or services for future delivery without Processor’s prior written authorization. If Member Bank or Processor have previously given such consent, you represent and warrant to Member Bank and Processor that you will not rely on any proceeds or credit resulting from such transactions to purchase or furnish goods or services. You will maintain sufficient working capital to provide for the delivery of goods or services at the agreed upon future date independent of any credit or proceeds resulting from Sales Drafts or other memoranda taken in connection with future delivery transactions.
6. Luqra Transactions:
   
   1. Luqra:  You must obtain the consent of Processor to process Luqra (“LQ”) transactions, and you may process such transactions only if the transactions comply with the Payment Card Industry Security Standard requirements set forth below. If you submit LQ transactions without Processor’s consent, Processor may immediately terminate this Agreement. You understand that transactions processed via LQ are high risk and subject to a higher incidence of chargebacks. A Merchant must not refuse to complete an LQ transaction using a MasterCard card solely because the Cardholder does not have a digital certificate or other secured protocol. You are liable for all chargebacks and losses related to LQ transactions, whether or not: a) LQ transactions have been encrypted; and/or b) you have obtained the consent of Processor to engage in such transactions. Encryption is not a guarantee of payment and will not waive any provision of this Agreement or deter a fraudulent transaction. You are responsible for contracting with a third party payment engine, payment gateway or other internet service provider. You must ensure that such third parties transmit Sales Drafts to Processor and Member Bank in an accurate manner and in compliance with the Rules, including but not limited to PCI DSS. All communication costs related to LQ transactions are your responsibility. You understand that Processor will not manage the LQ telecommunications link and that it is your responsibility to manage that link. All LQ transactions will be settled by Member Bank into a depository institution of the United States in U.S. currency.
   2. Requirements: For goods to be shipped on LQ transactions, you may obtain authorization up to 7 calendar days prior to the shipment date. You need not obtain a second authorization if the Sales Draft amount is within 15% of the authorized amount provided that the additional amount represents shipping costs. Further, your website must contain all of the following information: a) complete description of the goods or services offered, b) returned merchandise and refund policy c) customer service contact, including electronic mail address and/or telephone number, d) transaction currency (such as U.S. or Canadian dollars), e) export or legal restrictions, if known, and f) delivery policy. If you store Cardholder accounts numbers, expiration dates, and other personal Cardholder data in a database, you must follow Association guidelines in securing such data. If you store Cardholder account numbers, expiration dates, and other personal Cardholder data in a database, you must follow Association guidelines on securing such data.
   3. Cardholder Information Security Program:   If you accept LQ transactions, you must: install and maintain a working network firewall to protect data accessible via the Internet, keep security patches up-to-date, encrypt stored data and data sent over open networks, use and update anti-virus software, restrict access to data by business “need-to-know”, assign a unique ID to each person with computer access to data, not use vendor-supplied defaults for system passwords and other security parameters, track access to data by unique ID, regularly test security systems and processes, maintain a policy that addressed information security for employees and contractors, and restrict physical access to Cardholder information.
   4. Physical Address. If you accept LQ transactions, your website must include the physical address of your permanent establishment, along with your country of domicile either:
      • On the same screen view as the checkout screen used to present the total purchase amount; or
      • Within the sequence of webpages the Cardholder accesses during the checkout process.
   5. You acknowledge and agree that you will only submit LQ Card transactions in U.S. Dollars that arise from a Cardholder’s purchase over the Internet. If software is to be purchased by you, you will be responsible for sublicensing fees and all other fees for software and the software program utilized by you that enables you to connect to and maintain communication between you and the Internet. You will, at all times, maintain in effect a sublicense agreement for any such software. You agree to use any such software and the software program properly and for the purposes for which it was intended.
7. Third Party Service Provider:
   
   1. Authorization: Upon your request, Processor will provide access to authorization and/or data capture services for Third Party Service Provider transactions, such as American Express. All settlement and chargeback obligations and similar financial responsibilities arising from your transactions involving Third Party Service Providers will be governed exclusively by your agreement with such Third-Party Service Providers. You must enter into a separate agreement with such Third-Party Service Providers and abide by their terms and conditions. Neither Processor nor Member Bank are responsible for funding such transactions. The terms of this Agreement apply to Third Party Service Providers. Processor may notify you in writing of the fees applicable to Third Party Service Provider transactions. Third Party Service Providers separately invoice Merchants for their services, and their fees are not necessarily included in this Agreement (including the Merchant Application). Any applicable fees and charges for third party services will be disclosed by the applicable Third-Party Service Provider and may be subject to adjustment in accordance with the Third Party Service Provider’s terms and conditions. Additionally, Processor charges a transaction fee for such transactions in addition to those charged by Third Party Service Providers (see the Merchant Application). Your acceptance of cards bearing the symbols of organizations other than the Debit Networks or the Card Organizations, such as American Express, and transmission of such card transactions to Processor constitute your agreement to the terms of this Agreement with regard to such cards. Termination of your Agreement with Processor does not automatically terminate your agreement with Third Party Service Providers.
   2. Information: Processor and Member Bank reserve the right, and you agree and consent, to allow Processor and Member Bank to share your credit report and credit history with all Third-Party Service Providers. Changes made to this agreement, such as address or ACH changes, do not automatically make the same changes to the Third-Party Service Provider. You must contact the Third-Party Service Provider to make the changes. Processor is neither liable nor responsible for any fees or charges incurred if Processor or the Merchant Account has had any suspected fraudulent activity. Processor reserves the right to share such false or suspected fraudulent information with other financial entities.
   3. Statements: You must reconcile your sales tickets for each Third-Party Service Provider’s transactions against deposits to your bank account daily. Each Third-Party Service Provider provides its own statement, and you are responsible for reviewing each statement and resolving all issues regarding the transactions directly with that Third-Party Service Provider. Each Third-Party Service Provider sets its own rates and fees for its services and may adjust such rates and fees in accordance with your agreement with the Third-Party Service Provider. Processor and Member Bank are not liable or responsible for these transactions and have no legal access to them.
   4. JCB: The following special provisions apply (notwithstanding any contrary provision in this Agreement) to your JCB Card transactions: (i) you must retain original sales drafts and credit vouchers for at least 720 days after the transaction and must retain microfilm or legible copies of sales drafts and credit vouchers for at least three (3) years after the transaction; (ii) for purposes of your chargeback liability with respect to JCB Card transactions, an Authorization obtained on a transaction does not override any chargeback reason which may apply to the item; (iii) if you process JCB Card transaction data electronically, your account number must be included in the JCB Card transaction data transmitted to us, in addition to the other information required to be included on each sales draft or credit voucher; (iv) if you are a lodging merchant, JCB Cardholders must be allowed to cancel reservations at resort establishments until 4:00 p.m. on the scheduled arrival date; and (v) by contracting for JCB settlement services, you authorize JCB to publish your name, address and telephone number in JCB solicitation materials.
8. Age Restricted Products: If you are engaged in the sale of age-restricted products such as alcoholic beverages, tobacco products, weapons, and/or any other applicable age-restricted products or services, you must comply fully with all local, state, and federal laws governing the distribution of age-related products. You certify herein that you will implement age verification procedures governing the sale of such products, including age verification of each customer against an official government records database before entering certain transactions into the credit card payment system. For face-to-face sales, you will require the signature of the Cardholder. To verify legal age, you will also require the Cardholder to present a valid, government-issued photo identification card in the same name and address as the Cardholder. For sales made via mail, telephone, and/or the Internet, you will (1) only deliver age-restricted products to the name and address listed as belonging to the Cardholder; and (2) require, without exception, the signature of the Cardholder, as well as the presentation of a valid, government-issued photo identification card in the same name and address as the Cardholder to verify legal age upon delivery of the merchandise. Failure to abide by all applicable age verification laws may result in fines and/or loss of credit card merchant charge privileges, as well as termination of your account with Processor and Member Bank.

9. Cash Transactions

1. You shall not receive money from a Cardholder and subsequently prepare a credit voucher for the purpose of depositing it into the Cardholder’s account. Cash disbursement by you to a Cardholder is not permitted. Additionally, you shall not make any cash advance to an employee, principal, or family member of Merchant who is a Cardholder. You will not accept sales from Cardholders where the primary purpose of the transaction is the provision of working capital to the business and not the purchase of goods and/or services from the business.

10. Thirds Parties

1. Services: You may be using special services or software provided by a third party to assist you in processing transactions, including authorizations and settlements, or accounting functions. You are responsible for ensuring compliance with the requirements of any third party in using their products. This includes making sure you have and comply with any software updates. You are also responsible for demonstrating compliance by your Merchant Suppliers and other Agents with the requirements of the Cardholder Information Security Program and other security requirements. Processor has no responsibility for any transaction until that point in time when Processor receives data about the transaction.
2. Use of Terminals Provided by Others: You will notify Processor immediately if you decide to use electronic authorization or data capture terminals or software provided by any entity other than Processor or its authorized designee (“third-party terminals”) to process transactions. If you elect to use third-party terminals, you agree (i) the third party providing the terminals will be your agent in the delivery of Card transactions to Member Bank via a data processing network; and (ii) to assume full responsibility and liability for any failure of that third party to comply with the Rules or this Agreement. Neither Member Bank nor Processor will be responsible for any losses or additional fees incurred by you as a result of any error by a third-party agent or a malfunction in a third-party terminal. 

11. Vehicle Rental Authorization Procedures

1. Estimate: A special authorization procedure is available if you estimate the transaction amount based upon the Cardholder’s intended rental length at the time of rental, the applicable rental rate, tax, and/or mileage rates. Such an estimated transaction amount shall not include ancillary charges representing amounts to cover potential vehicle damages or insurance deductibles when the Cardholder waives insurance at the time of rental.
2. Procedures: Special terminal downloads may be required to qualify for certain rates on Vehicle Rental transactions. You shall record on the Sales Draft the date, amount, and all authorization approvals obtained. You shall disclose to the Cardholder the amount authorized at the time of rental.
   
   1. If no authorization was obtained at the time of rental and you, based upon Cardholder’s actual charges, later estimate that the transaction amount will exceed the applicable floor limit, you may obtain an Authorization approval code for the new estimated amount.
   2. You may obtain authorization for additional amounts (above any amount not authorized) on the car rental pickup date or prior to the car rental return. Additional authorization is not necessary if the sales transaction does not exceed the sum of the authorized amounts plus 75% of the sum of the authorized amounts.

12. Paper Processing Merchants

1. Paper processing merchants shall authorize by using the established floor limits. Any Merchant that wishes to accept a sales transaction that is under the established floor limits and that is not authorized is liable for the resulting chargebacks from those Card numbers listed on the Electronic Exception File. In the case of a Merchant depositing paper drafts, such drafts shall be deposited with Processor or Member Bank within 5 days of the sale date.

13. Forensic Investigations

1. You will fully cooperate with any forensic investigation initiated by an Association (including but not limited to any investigation that is ongoing at the time your Merchant Agreement is signed) until such time as the investigation is completed.

14. T&E Services

1. Travel and Entertainment (“T&E”) Merchants: A merchant whose primary function is to provide travel-related services shall be referred to as a Travel & Entertainment (“T&E”) Merchant. These include, but are not limited to, car rental, lodging, and central reservation services. A T&E Merchant may process delayed or amended charges if the Cardholder has consented to be liable for those charges. These charges may NOT include charges for loss, theft, or damage.
2. Services: T&E Merchants may participate in any of the following Visa T&E Services:
   • Priority Checkout Service
   • T&E Advance Deposit Service
   • T&E Cash Disbursement Service
   • Visa Reservation Service
3. Visa Priority Check-Out Service: You agree to
   
   1. accept all Visa Cards in accordance with this Agreement;
   2. have Card holder complete, sign, and return a Priority Check-out Agreement (“PCO Agreement”) which includes the Cardholder’s mailing address;
   3. complete a Sales Draft which includes the total sales amount and the words “Priority Check-Out” on the signature line;
   4. review the completed PCO Agreement and ensure the account number matches the account number on the Sales Draft if applicable;
   5. comply with normal authorization and deposit requirements
   6. at the Cardholder’s request, you must mail the Sales Draft copy, the itemized bill, and the signed PCO agreement to the Cardholder within three (3) business days of the Cardholder’s departure; and
   7. you must retain the itemized bill and signed PCO Agreement for a minimum of 6 months after the transaction date.
4. T&E ADVANCE DEPOSIT SERVICE: You agree to:
   
   1. accept all Visa Cards in accordance with this Agreement;
   2. obtain the Cardholder name, account number, expiration date on the Card, telephone number, mailing address, scheduled date of arrival/embarkation/rental, and intended length of stay/term/rental;
   3. determine the advance deposit amount, which is the cost of the intended length of stay, cost of the cruise, or cost of the intended term of rental, not to exceed 14 days;
   4. apply the deposit amount to the total obligation;
   5. provide: (l) reservation confirmation code to the Cardholder advising that it be retained; (2) advance deposit amount; and (3) cancellation policy requirements;
   6. advise the Cardholder the accommodations will be held according to the reservation and provide written confirmation if requested;
   7. advise the Cardholder that you will retain the deposit amount if the Cardholder has not canceled the reservation within the specified time frames;
   8. you must not charge for a no-show transaction;
   9. complete the Sales Draft including advance deposit amount, Cardholder name, mailing address, telephone number, account number, expiration date, the words “Advance Deposit” on the signature line, confirmation code, scheduled date of arrival/embarkation/rental, and the date and time the cancellation privileges, if any, expire without forfeiture;
   10. follow normal authorization procedures;
   11. mail a Sales Draft copy and cancellation policy to the Cardholder within three (3) business days of the sales date;
   12. accept all Cardholder cancellations within the time limits specified by you
   13. upon cancellation, you shall complete a Credit Transaction Receipt with the information set out in (ix) above and include the cancellation code. You must deposit the Credit Transaction Receipt within 5 days of the transaction date and mail a copy to the Cardholder within 3 days of the transaction date of the Credit Transaction Receipt;
   14. for a a Lodging Merchant, if the reserved accommodations are unavailable, you must provide the Cardholder the following services without charge: (l) refund the entire advance deposit amount; (2) a copy of the Credit Transaction Receipt to the Cardholder; (3) comparable accommodations at an alternate establishment for the number of nights specified in the reservation not to exceed 14 nights or until the reserved accommodations become available; (4) two three-minute telephone calls;
       (5) message forwarding to the alternate establishment; and (6) transportation to the alternate establishment and return to the original establishment and, if requested, daily transportation to and from the alternate establishment and your location; and
   15. for a Car Rental Merchant if the reserved vehicle is unavailable, you must provide the Cardholder the following services without charge: (l) refund the entire advance deposit amount; and (2) provide a comparable vehicle for the number of days specified in the reservation, not to exceed 14 days or until the reserved vehicle becomes available.
   16. for a Cruise Line Merchant if the reserved accommodations are unavailable, and no comparable accommodations are available on the ship, the Merchant may offer: (l) a comparable cruise within the same approximate sailing dates and number of sailing days specified in the reservation; (2) any extra nights’ accommodations or air fare to a different port city necessitated by the Cardholder’s acceptance of alternate accommodations.

   The Merchant must refund the entire T&E deposit amount if comparable accommodations are not available or the Cardholder does not accept the offered accommodations. The Merchant must provide a credit receipt to the Cardholder and the Merchant must provide all of the following without charge: (l) one night’s hotel accommodation, if required; (2) transportation to the hotel as well as the airport; (3) Airline transportation to the airport nearest the Cardholder’s residence; and (4) reasonable out-of-pocket expenses incurred by the Cardholder because the guaranteed accommodations were not available.

5. T&E Cash Disbursement Service:
   
   1. Cardholder indicates at registration the intent to pay for services with a Visa Card;
   2. Before disbursement, you review positive identification, and, if permitted by applicable law, record type and number on the Sales Draft;
   3. You complete an 80 column Cash Disbursement Sales Draft or a 51 column Cash Disbursement T&E Sales Draft that includes the Cardholder’s positive identification or a Cash Disbursement Record;
   4. You do not disburse more than $250.00 during the Cardholder’s stay. Cash availability may limit cash disbursements; and
   5. You must not include any additional fees or charges except taxes or charges imposed by law on the transaction amount.
6. Visa Reservation Service: Any Merchant who accepts Cards to guarantee reservations must do so in accordance with the following requirements:
   
   1. You must accept all Visa Cards in accordance with this Agreement;
   2. You must obtain the Cardholder’s account  number, expiration date, and name embossed on the Card. You must quote to Cardholder the rate of reserved accommodation, Merchant’s name and address, and the Confirmation Code advising that it be retained. Advise the Cardholder that if he/she has not checked in by checkout time the following day after his/her scheduled arrival date or the reservation was not properly canceled, the Cardholder will be billed for one night’s lodging plus applicable taxes. If requested, you will provide a written confirmation with the above information including the Visa reservation service provisions relating to the Cardholder’s obligation, and any other reservation details;
   3. You must accept all cancellations prior to the specified time. The Merchant must not require more than 72 hours cancellation notification prior to the scheduled arrival date. But, if the Cardholder makes the reservation within 72 hours of the scheduled arrival date, the cancellation deadline must be no earlier than 6:00 p.m. on the arrival date. If you require that the Cardholder cancel before 6:00 p.m. on the arrival date, you must mail the cancellation policy to the Cardholder;
   4. If the reservation is properly canceled, you must provide a cancellation code and advise the Cardholder to retain it. If requested, you must mail a confirmation of cancellation that includes the Cardholder name, account number, card expiration date, cancellation code, and details related to the canceled reservation;
   5. If Cardholder  has  not  claimed  or  canceled  the accommodation by the specified time, the room(s) must be held available to accordance with the reservation until checkout time the following day. You may then complete a Sales Draft for 7 night’s lodging plus applicable tax, indicating. The Cardholder’s account number, expiration date, and name embossed on the Card and the words “No Show” on the Cardholder signature line. You must obtain an authorization code for the no show transaction;
   6. guaranteed accommodations are unavailable, you must provide Cardholder with comparable accommodations as described in Section 14.C.xiv above. These services shall be provided at no cost to Cardholder.

15. Healthcare Transactions and Programs

1. Preauthorized HealthCare Transactions:
   
   1. Order Form: Merchants accepting preauthorized health care transactions must have the cardholder complete an order form containing the following:
      
      1. a request for the services to be charged to the cardholder’s account;
      2. assignment of insurance benefits to you;
      3. authorization for you to charge the cardholder’s account for only that portion of the bill subsequent to your receipt of any applicable insurance payment;
      4. duration of time, not to exceed one (1) year, for which permission is granted;
   2. Procedures:  Merchants accepting preauthorized health care transactions must:
      
      1. retain a copy of the order form during the period it is in effect;
      2. provide a copy of the order form upon processor or member bank’s request;
      3. type or print the words “Preauthorized Health Care” on the signature line of the sales draft; and submit a sales draft within 90 days of the service date and request authorization for the amount due upon receipt of notice of adjudication from cardholder’s insurance company;
   3. Cancellation: You must not complete a preauthorized health care transaction after receiving a decline response or a notice of cancellation for cardholder, processor or member bank.
2. Health Care Auto-Substantiation: Merchants participating in Health Care Auto-Substantiation must comply with the provisions of the Visa Health Care Auto-Substantiation Transactions Documents. The Merchant must also obtain a license from and be certified by SIGIS, the Special Interest Group for IIAS Standards.

3. Health Care Eligibility Service: Merchants participating in the Health Care Eligibility Service must comply with the provisions of the Visa Health Care Eligibility Service Implementation Guide.

16. Visa Supermarket Program

1. A merchant that wishes to participate in the Visa Supermarket Incentives Program must first obtain a Supermarket Incentives Agreement with the Processor or Member Bank.

17. Telephone Services

1. A telephone service merchant must not accept payment for a telephone call when the card number is either entered via touchtone keypad or provided to an operator. This prohibition excludes the following:
   
   1. Telephone service transactions conducted at an unattended cardholder-activated terminal;
   2. Transactions for which the issuer has a contract with the carrier;
   3. Transactions involving telephone services that have been explicitly approved by Visa and provide appropriate risk controls;
   4. Telephone orders for goods and services; and
   5. Transactions provided by inbound teleservices merchants, as specified in the Visa Merchant Data Standards Manual.

18. Automated Fuel Dispenser

1. Procedures:
   
   1. When an Automated Fuel Dispenser ("AFD") transaction takes place, the card must be presented and the entire, unaltered contents of either Track 1 or Track 2 of the magnetic stripe must be read and transmitted along with a value of "90" in the POS entry mode code.
   2. The Merchant name, city, state, and zip code of the station location where the transaction took place must be included in any authorization and clearing message.
   3. A transaction receipt must be produced, and the transaction must be cleared within two (2) days of the transaction date.
   4. You must obtain an authorization for the exact amount of the transaction or use the status check procedure, which requires you to request an authorization for no more than $1.00.
   5. You must use the status check procedure if the floor limit is zero and the actual transaction amount is no more than the maximum set by Visa and MasterCard, which amounts are currently $125.00 for Visa transactions and $100.00 for MasterCard transactions.
   6. You must have an established self-service terminal operating plan on file with Processor or Member Bank and must establish a velocity check program that monitors the volume and frequency of account.
   7. The transaction ratio of chargebacks to total Visa Interchange for Merchant must not exceed an average of 0.30% for the previous six months.
   8. The transaction ratio of fraud to total Visa Interchange for Merchant must not exceed an average of 0.40% for the previous six months.
   9. Under no circumstances should you use an arbitrary estimation of the transaction amount to obtain an authorization.
   10. An AFD must not dispense scrip.
   11. Terminals at automated fuel dispensers not qualified for the Qualified Rate set forth on the Merchant must obtain authorization within 7 days of the transaction date. The sale must be for less than the maximum amount set by Visa and MasterCard, currently $125.00 for Visa transactions and $100.00 for MasterCard transactions.
2. Programming: Processor is not responsible for programming or reprogramming of fuel dispensers.

19. Imprinters

1. You must be in possession of a working imprinter, a supply of blank Sales Drafts, and an accurate imprinter plate showing your DBA name, city, state, and Merchant Identification Number. If you are not in possession of the above equipment, you must contact Processor to obtain such equipment. Failure to use the equipment and supplies listed above will seriously increase your liability for chargebacks. You must obtain an imprint of a Card when a Card will not swipe. Obtaining an imprint of a Card will greatly reduce your chances of a chargeback.

20. Merchant Identification Number

1. You are responsible for ensuring that your Merchant Identification Number (“MID”) is kept confidential. When a change to your Merchant Account is required, you must disclose your MID to the Processor representative to confirm that the person requesting the change has the authority to do so. If the person requesting the change discloses the proper MID, Processor or Member Bank shall assume that person has the proper authority to make the change. You shall be fully liable for any changes to your Merchant Account after disclosing the MID. Processor or Member Bank may request additional information from you to further verify your identity.

21. Use of Third-Party Terminals and/or Software

1. If you elect to use the terminal of a third-party software provider (such as POS or Accounting System vendors) to capture and transmit to Processor or Member Bank, you assume full responsibility and liability for any failure of such third-party provider to comply with the Rules. The third-party provider is the source of information regarding authorizations and reversals that may be needed by Processor or Member Bank. Certain reversals require authorization information to reverse. You are responsible for obtaining this information from the third-party provider. Processor and Member Bank are not liable for sales that were not received by them. In addition, Processor will not be liable for third-party software or clearing of Association transactions.

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THE FOLLOWING RULES APPLY ONLY IF MEMBER BANK OR PROCESSOR SETTLES YOUR DISCOVER NETWORKS CARD TRANSACTIONS

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22. Discover Network Marks

1. You are prohibited from using the Discover Network Program Marks, as defined below, other than as expressly authorized in writing by Processor or Member Bank. “Discover Network Program Marks” mean the brands, emblems, trademarks, and/or logos that identify Discover® Network cards. Additionally, you shall not use the Discover Network Program Marks other than to display decals, signage, advertising, and other forms depicting the Discover Network Program Marks that are provided to you by Processor or Member Bank pursuant to this Agreement or otherwise approved in advance in writing by Processor or Member Bank. You may use the Discover Network Program Marks only to promote the services covered by the Discover Network Program Marks by using them on decals, indoor and outdoor signs, websites, advertising materials, and marketing materials; provided that all such uses must be approved in advance by Processor or Member Bank in writing. You shall not use the Discover Network Program Marks in such a way that customers could believe that the products or services offered by you are sponsored or guaranteed by the owners of the Discover Network Program Marks. You recognize that you have no ownership rights in the Discover Network Program Marks. You shall not assign to any third party any of the rights to use the Discover Network Program Marks. Your authority to use the Discover Network Program Marks will terminate immediately upon notice from Processor, Member Bank, or Discover Network.

23. Priority Check-Out Service

1. "If you offer priority check-out services, you must comply with the following requirements: (i) require the Cardholder to sign the registration card at the time of check-in, acknowledging responsibility for all charges, and obtain an authorization for the estimated amount of the accommodations at check-in; (ii) complete a sales draft at check-out by entering the total amount of charges incurred during the stay, including restaurant bills, telephone charges, convenience bar charges, missing item fees, and miscellaneous expenses; (iii) write the words “Priority Check-out” on the Cardholder signature line of the sales draft; (iv) obtain a final authorization code for any additional amounts from the check-in estimate to equal the total amount to be billed to the Cardholder by following the normal authorization procedures; and (v) mail (at the address shown on the registration card) or otherwise deliver a copy of the sales draft and the itemized lodging bill (portfolio) to the Cardholder within seven (7) calendar days of check-out."

24. Card Checks

1. Card checks are frequently issued to cardholders by Discover Network. You agree to accept card checks on a basis consistent with the terms of your policy applicable to acceptance of other payment card checks. You should handle these card checks like any other personal check drawn upon a bank in the United States.

25. Cardholder Contact

1. You must not contact any Discover Network cardholder with respect to any matter arising under the Discover Rules, except as required or permitted in the Discover Rules.

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IN ADDITION TO THE OTHER REQUIREMENTS SET FORTH IN THIS DOCUMENT, THE FOLLOWING RULES APPLY TO PIN-DEBIT CARD TRANSACTIONS.

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26. Honoring PIN-Debit Cards

1. You shall not require cardholders to provide personal information (such as telephone number or address) as a condition for honoring a PIN-debit card, unless required by the rules. You may not require or request the cardholder’s signature or any other means of verifying the cardholder’s identity. You shall place the PIN entry device in an area accessible by all cardholders and that will reasonably prevent others, including merchant employees, from observing the PIN. Any penalties incurred by you for failure to comply with debit network rules will be your responsibility. You assume exclusive responsibility for the consequences of any oral or written instructions you may give to Processor and/or Member Bank, for your failure to properly access the services in the manner prescribed by Processor or Member Bank, and for your failure to supply accurate input information. You will be responsible for auditing, balancing, verifying, and reconciling any out-of-balance condition, and for notifying Processor of any errors in the foregoing after receipt of the applicable report from Processor or Member Bank. You will reject all incorrect reports or output within two (2) business days after receipt of the reports or output. Note, also, that neither Processor nor Member Bank warrant the continuing availability of any debit network.

27. PIN-Debit Card Sales Drafts

1. Procedures: You shall deliver to the Cardholder at the time of a sale a true and completed copy of the Sales Draft evidencing a sale involving use of a PIN-Debit Card (“PIN-Debit Sales Draft”). The PIN-Debit Sales Draft must comply with the Rules and Laws. The following information must be included on the PIN-Debit Sales Draft: (i) the PIN-Debit Card account number; (ii) your DBA name; (iii) your city and state; (iv) the amount of sale; and (v) the sale date. A PIN-Debit Sales Draft shall be made available to the Cardholder at each terminal. You may not require or request the Cardholder to provide or disclose their PIN in any oral or written manner to the Merchant. You shall not impose any fee or charge for a PIN-Debit Card transaction without the prior written consent of Processor or Member Bank. If surcharging is approved by Processor, it must be a separate line item on the PIN-Debit Sales Draft and must be in compliance with all Debit Networks’ rules and federal and state laws and regulations. You shall not process any sale if an authorization code is not received through the electronic terminal. When a denial to an authorization request is received, the POS transaction shall not be completed unless completed as a store and forward transaction or resubmission transaction. A sale shall not be completed if you know or should know that the sale is fraudulent or not authorized by the Cardholder.

2. Reversal: A sale may be reversed or voided electronically, but only if such reversal/void is entered prior to midnight of the calendar day on which the sale was initiated. To effect a reversal or void, Cardholder must reenter the PIN, the magnetic stripe reader must read the card, and you must transmit the trace number and the exact dollar amount of the sale to be reversed or voided. A reversal or void must be initiated at the same Merchant identified on the PIN-Debit Sales Draft at which the original sale was initiated, but it need not be initiated at the same POS terminal.

3. Returns:  All returns shall be processed in accordance with your normal procedures except that you or Cardholder shall not attempt to reverse a previously approved POS transaction unless otherwise permitted in accordance with the Debit Network Rules. Any sale known by you to be erroneous should be canceled and re-billed in the Cardholder’s presence.

4. Balance Inquiry: Balance inquiries may be performed only by the Cardholder at a Cardholder-operated terminal and shall at all times require the Cardholder to enter the PIN and use the magnetic stripe reader.

28. Promotional Materials

1. You will adequately display promotional materials to inform the public that PIN-Debit Cards will be honored by you. All uses by you of decals, signs, printed and broadcast materials and other promotional materials must be in conformity with the requirements of the Debit Networks, Processor, and Member Bank. You will not at anytime do, or cause to be done, any act or deed in anyway impairing or intended to impair Processor or Member Bank’s exclusive right, title and interest in and to its respective protected marks.

29. Reversals

1. You agree to pay Processor or Member Bank for any Debit Network fees, fines or charges imposed on you, Processor or Member Bank. Such reimbursement will be accomplished by the debit of the sum(s) involved from your Merchant Account. If Processor or Member Bank elects, at its discretion, to take action on reversals after the Debit Network time limits have expired, such action shall be done at additional cost. Upon request of a Debit Network, processor, Processor, or Member Bank, you will retrieve and forward to Processor or Member Bank, within the time frame required, either the original or a readable copy of the terminal journal tape or duplicate transaction receipt for the transaction in question and, if requested, will give the Debit Network such information from such transaction records as it requests by telephone. You will, on request of the Debit Network, cooperate fully with the Debit Network and the Card issuing participant in order that the participant may comply with the error resolution procedures.

30. Your Name and Address

1. All forms submitted to Processor or Member Bank must bear both your Legal/Corporate and “Doing Business As” (“DBA”) name.

31. Equipment

1. Use: You shall take all necessary steps to ensure that all POS Terminals and PIN Entry Devices operated in all of your locations:
   
   1. are placed in an area accessible by all Cardholders;
   2. are available for use whenever you are open for business;
   3. will function with minimal error, meeting all applicable technical specifications and security regulations; and
   4. will require the Cardholder to enter the Cardholder's PIN at or near the checkout location when initiating a POS transaction.
2. Standards: A PIN Entry Device must meet the ANSI standard format X9.8, I99S or newer requirements, as they are released. A PIN Entry Device must comply with the PCI DSS requirements for POS and PED equipment. Terminals must have a magnetic stripe capable of reading Track 2 on the PIN-Debit Cards. PINs used in conjunction with any store and forward transaction or your resubmission must be encrypted and stored within a tamper-resistant security module. If your authorization system is capable of store and forward, it must comply with the Debit Networks’ rules and regulations regarding this capability. Processor or Member Bank, the Issuer and the Debit Networks shall not be liable for any losses suffered by you arising from the use of the store and forward function. A PIN must never be logged in any form as a function of software either in the clear or encrypted.

32. Supply of Information

1. You must submit all information requested by the Debit Networks, Processor, or Member Bank, including but not limited to lists and mailing addresses of terminals. You shall not sell, purchase, provide, or exchange account number information in any form, including but not limited to transaction receipts, carbon copies of transaction receipts, mailing lists, tapes, to any third party other than to your agents for the purpose of assisting you in your business, or to the Debit Networks, Processor, or Member Bank, or pursuant to a government request.

33. Distribution and Storage of Information

1. You shall not disclose a Cardholder’s account information or any other personal information to third parties other than to your agents for the purpose of completing the sale or as specifically required by law or by the Rules. You shall store in a limited access area for at least one (1) year after the date of sales all transaction records, and you shall make and retain for at least two (2) years the original or legible microfilm copies of both sides of all transaction records. Prior to discarding, you shall destroy or make unreadable all containing Cardholder account numbers. There are no voice authorizations for PIN-Debit Card transactions and no manually imprinted PIN-Debit Sales Drafts. You may not store the Cardholder’s PIN in any manner.

34. Left PIN-Debit Card

1. PIN-Debit Cards that are inadvertently left at your location must be held under dual control during the time they are retained. PIN-Debit Cards inadvertently left at your location may be returned to the Cardholder by you under the following conditions: (A) the Card was inadvertently left by the Cardholder at an on-premise location, (B) the Cardholder requests the Card within 1 business day, and (C) the Cardholder provides two (2) forms of current identification, at least one of which is a photo identification. If the Cardholder has not requested the Card within one (1) business day, the Card should be destroyed by cutting it in half through the stripe.

Schedule I – EBT Transactions

Capitalized terms that are used herein but not defined herein will have the meaning as set forth in the Agreement.

If elected by Merchant on the Application, Merchant wishes to purchase from Processor and Member Bank and Processor and Member Bank wish to sell to Merchant certain services necessary for the authorization, processing, and settlement of point-of-sale EBT transactions submitted to the EBT Networks and which transactions are initiated through Merchant in connection with the authorization, providing, and/or issuance of United States Department of Agriculture, Food and Nutrition Services (“FNS”) food stamp benefits (“FS Benefits”) and/or Temporary Assistance to Needy Families (“TANF”) benefits and/or other government-delivered cash assistance benefits (“Cash Benefits” with FS Benefits, “Benefits”) to benefit recipients in the EBT Project areas (“Recipients”) supported by Processor and Member Bank through the applicable gateway through the use of a State-issued Benefit Security Card (“EBT Card”) issued by a state participating in the EBT Project and benefit recipients of other states not within the Project area (“Other Recipients”). Merchant agrees to provide and/or issue Benefits at each of its locations to the Recipient as hereinafter provided and in accordance with the procedures specified by Processor and/or Member Bank, the applicable EBT Network or State’s EBT rules and regulations as amended from time to time and all applicable laws governing the issuance and/or provision of Benefits. Merchant will provide each Recipient a receipt for each Benefit issuance transaction undertaken by Merchant. Merchant will be solely responsible for the issuance of Benefits other than in accordance with authorizations received from us.

Merchant will provide Processor, upon execution of this Agreement, with a complete list of all of its locations in the continental United States where Merchant desires to accept EBT Cards, with correct and complete mailing addresses and complete telephone numbers, in location number order. Merchant will provide an updated list at Processor’s request and as required. All locations from which Merchant accepts EBT Cards will be subject to this Agreement and will be identified in writing from time to time by Merchant.

Merchant will honor any valid EBT Card properly tendered for use when it is presented with a valid personal identification number (PIN). Merchant will not engage in acceptance practices or procedures that discourage the use of any valid EBT Card. Merchant will not complete any point-of-sale EBT Card transaction that has not been authorized. Merchant will ensure that if Recipient enters a valid PIN, Merchant will not require another form of identification from Recipient unless Merchant has grounds to suspect fraud.

Merchant will provide and/or issue Benefits to Recipients, in accordance with the policies and Rules in the amount authorized through Merchant’s point-of-sale terminal, with PIN Pad and printer (“Equipment”), upon presentation by Recipient of an EBT Card and Recipient entry of a valid PIN. Merchant agrees that in the event of failure of the Equipment to print Benefit issuance information as approved and validated as a legitimate transaction, Merchant will comply with Processor’s and Member Bank’s procedures and rules for authorization of Benefits in such instance. If Merchant has agreed to Cash Benefits, Merchant agrees to maintain adequate cash on hand to issue and/or provide confirmed Cash Benefits and will issue and/or provide Cash Benefits to Recipients in the same manner and to the same extent cash is provided to Merchant’s other customers. Merchant will not require, and will not in the advertising suggest, that any Recipient must purchase goods or services at its facilities as a condition to the issuance and/or provision of Cash Benefits to such Recipient, unless such condition applies to other customers as well. Merchant will not designate special checkout lanes restricted to use by Recipients, provided that if Merchant designates special checkout lanes for electronic debit, or credit cards and/or other payment methods such as checks or other than cash, Recipients may be directed to such lanes so long as other customers are directed there as well.

If Merchant supports the issuance and/or provision of FS Benefits through manual benefit issuance procedures during the period of time when normal benefit issuance is not possible, then the following limitations will apply to manual issuance and/or provision of FS Benefits by Merchant:

1. Merchant must receive an authorization number for the amount of the purchase via telephone at the time of sale.
2. Specified Recipient, clerk and sales information, including the telephone authorization number, must be entered properly and legibly on the manual sales draft.
3. The manual sales draft must be submitted to the applicable EBT Network for processing within ten (10) calendar days following the date of authorization or any such earlier period of time specified in any applicable Rules or regulations.
4. Except as otherwise specifically provided by any applicable Rules or laws, Merchant will not be reimbursed and will be solely responsible for all manual transactions when Merchant fails to obtain an authorization number at the time of sale or otherwise fails to process the manual transactions in accordance with any applicable Rules or regulations.
5. Except as otherwise specifically provided by any applicable Rules or laws, Merchant may not "resubmit" a manual sales draft for payment if insufficient funds exist at the time that the manual sales draft is presented for processing and payment.

Merchant agrees to comply with all applicable laws and rules in the performance of its obligations under this Schedule I and the Agreement, including without limitation, laws pertaining to delivery of goods and service to Benefit Recipients and Benefit Recipient confidentiality, and the federal Civil Rights Act of 1964, Rehabilitation Act of 1973, Americans with Disabilities Act of 1990, Clean Air Act, Clean Water Act, Energy Policy and Conservation Act, Immigration Reform and Control Act of 1986, and regulations issued by the Department of Agriculture pertaining to Food Stamp Program regulation.

Merchant agrees to comply with Quest Operating Rules issued by the National Automated Clearing House Association ("NACHA") as approved by FNS or the Federal Reserve Bank and such other Rules and regulations as may be applicable to the providing and/or issuance of Benefits by Merchant hereunder. Merchant agrees to comply with all additional procedures specified by the State or EBT Networks, regarding lost EBT Cards, forgotten PINs, discrepancies in Benefits authorized and similar matters.

Merchant will not accept any EBT Card for any purpose other than the providing and/or issuance of Benefits, including without limitation as security for repayment of any Recipient obligation to Merchant. In the event of any violation of this provision, Merchant will be obligated to reimburse the State for any Benefits unlawfully received by either Recipient or Merchant.

Merchant agrees to separately maintain records of EBT transactions as may be reasonably requested or required by the State or its designated agent and to promptly make such records available for audit upon request to representatives of the State or its designated agent, or other authorized State or Federal government agency during normal business hours.

To assure compliance with this Agreement, the State, its designated agent, or other authorized State or Federal governmental agency, will at all times have the right to enter, during normal business hours, Merchant’s premise to inspect or evaluate any work performed under this Agreement, or to obtain any other information required to be provided by Merchant or otherwise related to this Schedule I or the Agreement.

Merchant agrees to maintain and preserve all financial records or documentation arising hereunder during the course of this Agreement and for a period of three (3) years following Benefit provision and/or issuance, or for such additional period as applicable regulations or law may require. Records involving matters in litigation will be kept for a period of not less than five (5) years following the termination of the litigation.

If Merchant provides or issues FS Benefits under this Agreement, Merchant represents and warrants to Processor and Member Bank that Merchant is a FNS authorized retailer and Merchant is not currently disqualified or withdrawn from redeeming food stamps or otherwise disqualified or withdrawn by FNS. Merchant agrees to secure and maintain at its own expense all necessary licenses, permits, franchises, or other authorities required to lawfully effect the providing and/or issuance and distribution of Benefits under this Schedule I and the Agreement, including without limitation, any applicable franchise tax certificate and non-governmental contractor’s certificate, and covenants that Merchant will not issue Benefits at any time during which Merchant is not in compliance with the requirements of any applicable law.

Merchant’s authority to issue Benefits may be suspended or terminated by the State or its agents or contractors, in their sole discretion, effective upon delivery of a notice of suspension or termination specifying the reasons for such suspension or termination if there will be (i) any suspension, injunction, cessation, or termination of Processor’s or Member Bank’s ability to provide EBT processing services; or (ii) failure by Merchant, upon not less than thirty (30) days prior written notice, to cure any breach by Merchant of the provisions of these terms and conditions, including without limitation, Merchant’s (a) failure to support the issuance of Benefits during its normal business hours consistent with Merchant’s normal business practices, (b) failure to comply with issuance procedures, (c) impermissible acceptance of an EBT card, or (d) disqualification or withdrawal of the FS program. Processor and/or Member Bank may terminate this Schedule I if Merchant is disqualified or withdrawn from the Benefit issuance program(s) indicated on the Merchant Application.

If Merchant provides and/or issues EBT Benefits in more than one State pursuant to this Schedule I and the Agreement, the laws of the State in which the Benefits were issued will apply to information arising out of that transaction. Processor and Member Bank will charge Merchant a fee for each EBT Card transaction as set forth on the Merchant Application regardless of whether said transaction is approved, declined or determined invalid. Merchant acknowledges that the fees set forth on the Merchant Application are based upon certain EBT Network, State, gateway and access fees currently in effect, and upon certain sponsorship arrangements made by us with an EBT Network for Merchant’s sponsorship needed to participate in the EBT project and to certain other States not within the EBT Project area. Merchant agrees that should any State or U.S. government entity or any of a State’s or U.S. government’s designated agents charge a fee or assess any charges or increase any fees on or in connection with EBT Card transactions, then Processor and Member Bank will have the right to adjust its fees. Merchant agrees to pay for all gateway and access fees, EBT Network fees, setup, adjustment or chargeback fees which may be imposed by Processor or Member Bank, an EBT Network or a State participating in the EBT Project. Processor and Member Bank will charge Merchant the daily/monthly fees as set forth on the Merchant Application for the services to be provided pursuant to this Schedule I and such amounts will be payable as provided for in Section 6 of the Agreement. Said fees may be collected hereunder in accordance with the terms and provisions of this Schedule I, the Agreement and the Merchant Application.

Schedule II – Wireless Terminals Using GPRS Services or CDMA

If the Merchant elects to use wireless terminals and receives wireless services from the carriers noted below, the following terms and conditions shall apply: Capitalized terms that are used herein but not defined herein will have the meanings as set forth in the Agreement.

1. If the Merchant (the “End User”) has a wireless terminal that uses the GPRS Services of AT&T (“Wireless Service Carrier” or “Underlying Carrier”), the following terms and conditions apply:
   
   1.  THE END USER HAS NO CONTRACTUAL RELATIONSHIP WITH THE UNDERLYING WIRELESS SERVICE CARRIER AND IS NOT A THIRD-PARTY BENEFICIARY OF ANY AGREEMENT BETWEEN TRANSACTION NETWORK SERVICES, INC. AND THE UNDERLYING CARRIER. THE END USER UNDERSTANDS AND AGREES THAT THE UNDERLYING CARRIER SHALL HAVE NO LEGAL, EQUITABLE, OR OTHER LIABILITY OF ANY KIND TO THE END USER. IN ANY EVENT, REGARDLESS OF THE FORM OF THE ACTION, WHETHER FOR BREACH OF CONTRACT, WARRANTY, NEGLIGENCE, STRICT LIABILITY IN TORT OR OTHERWISE, THE END USER’S EXCLUSIVE REMEDY FOR CLAIMS ARISING IN ANY WAY IN CONNECTION WITH THIS AGREEMENT, FOR ANY CAUSE WHATSOEVER, INCLUDING BUT NOT LIMITED TO ANY FAILURE OR DISRUPTION OF SERVICE PROVIDED HEREUNDER, IS LIMITED TO PAYMENT OF DAMAGES IN AN AMOUNT NOT TO EXCEED THE AMOUNT PAID BY THE END USER FOR THE SERVICES DURING THE TWO (2) MONTH PERIOD PRECEDING THE DATE THE CLAIM AROSE.
   2. THE END USER SHALL INDEMNIFY AND HOLD HARMLESS THE UNDERLYING WIRELESS SERVICE CARRIER AND ITS OFFICERS, EMPLOYEES, AND AGENTS AGAINST ANY AND ALL CLAIMS, INCLUDING WITHOUT LIMITATION CLAIMS FOR LIBEL, SLANDER, OR ANY PROPERTY DAMAGE, PERSONAL INJURY, OR DEATH, ARISING IN ANY WAY, DIRECTLY OR INDIRECTLY, IN CONNECTION WITH THIS AGREEMENT OR THE USE, FAILURE TO USE, OR INABILITY TO USE THE NUMBER EXCEPT WHERE THE CLAIMS RESULT FROM THE UNDERLYING CARRIER’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. THIS INDEMNITY SHALL SURVIVE THE TERMINATION OF THE AGREEMENT.
   3. THE END USER HAS NO PROPERTY RIGHT IN ANY NUMBER ASSIGNED TO IT AND UNDERSTANDS THAT ANY SUCH NUMBER CAN BE CHANGED FROM TIME TO TIME.
   4. THE END USER UNDERSTANDS THAT TRANSACTION NETWORK SERVICES, INC. AND THE UNDERLYING CARRIER CANNOT GUARANTEE THE SECURITY OF WIRELESS TRANSMISSIONS AND WILL NOT BE LIABLE FOR ANY LACK OF SECURITY RELATING TO THE USE OF THE SERVICES.
2. If Merchant (the “End User”) has a wireless terminal that uses the CDMA Services of Verizon or Sprint (“Wireless Service Carrier” or “Underlying Carrier”), the following terms and conditions apply.
   
   1. END USER HAS NO CONTRACTUAL RELATIONSHIP WITH THE UNDERLYING WIRELESS SERVICE CARRIER AND END USER IS NOT A THIRD PARTY BENEFICIARY OF ANY AGREEMENT BETWEEN TRANSACTION NETWORK SERVICES, INC. AND UNDERLYING CARRIER. END USER UNDERSTANDS AND AGREES THAT THE UNDERLYING CARRIER SHALL HAVE NO LEGAL, EQUITABLE, OR OTHER LIABILITY OF ANY KIND TO END USER. IN ANY EVENT, REGARDLESS OF THE FORM OF THE ACTION, WHETHER FOR BREACH OF CONTRACT, WARRANTY, NEGLIGENCE, STRICT LIABILITY IN TORT OR OTHERWISE, END USER’S EXCLUSIVE REMEDY FOR CLAIMS ARISING IN ANY WAY IN CONNECTION WITH THIS AGREEMENT, FOR ANY CAUSE WHATSOEVER, INCLUDING BUT NOT LIMITED TO ANY FAILURE OR DISRUPTION OF SERVICE PROVIDED HEREUNDER, IS LIMITED TO PAYMENT OF DAMAGES IN AN AMOUNT NOT TO EXCEED THE AMOUNT PAID BY END USER FOR THE SERVICES DURING THE TWO (2) MONTH PERIOD PRECEDING THE DATE THE CLAIM AROSE.
   2. END USER SHALL INDEMNIFY AND HOLD HARMLESS THE UNDERLYING WIRELESS SERVICE CARRIER AND ITS OFFICERS, EMPLOYEES, AND AGENTS AGAINST ANY AND ALL CLAIMS, INCLUDING WITHOUT LIMITATION CLAIMS FOR LIBEL, SLANDER, OR ANY PROPERTY DAMAGE, PERSONAL INJURY OR DEATH, ARISING IN ANY WAY, DIRECTLY OR INDIRECTLY, IN CONNECTION WITH THIS AGREEMENT OR THE USE, FAILURE TO USE, OR INABILITY TO USE THE NUMBER EXCEPT WHERE THE CLAIMS RESULT FROM THE UNDERLYING CARRIER’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. THIS INDEMNITY SHALL SURVIVE THE TERMINATION OF THE AGREEMENT.
   3. END USER HAS NO PROPERTY RIGHT IN ANY NUMBER ASSIGNED TO IT AND UNDERSTANDS THAT ANY SUCH NUMBER CAN BE CHANGED FROM TIME TO TIME.

END USER UNDERSTANDS THAT TRANSACTION NETWORK SERVICES, INC. AND THE UNDERLYING CARRIER CANNOT GUARANTY THE SECURITY OF WIRELESS TRANSMISSIONS AND WILL NOT BE LIABLE FOR ANY LACK OF SECURITY RELATING TO THE USE OF THE SERVICES.

Schedule III – Voyager Fleet Card Merchant Addendum

If Merchant elects to accept Voyager Fleet Cards, the following terms and conditions shall apply. Capitalized terms used but not defined in these Terms and Conditions shall have the meanings ascribed to them in the Agreement.

1. General

1. Processor and Voyager Fleet Systems ("VFSI") each have adopted rules and regulations relating to all aspects of acceptance and processing of Voyager Fleet Cards ("Voyager Cards"). Such rules and regulations, as amended from time to time, are incorporated into these Terms and Conditions by reference and shall be referred to as the "Voyager Rules". The current Voyager Rules are set forth in Section 5 of these Terms and Conditions.
2. As a result of Merchant submitting transactions resulting from acceptance of Voyager Cards ("Voyager Sales") for processing to Processor, Processor will process such Voyager Sales and credit or debit Merchant's Merchant Account with the resulting proceeds. In addition, when a disputed transaction or chargeback occurs, Merchant agrees to provide all requested information to Processor and Processor agrees to forward such information to VFSI in accordance with the Voyager Rules. Processor is not responsible for the outcome of any chargeback.
3. Merchant agrees that these Voyager Terms and Conditions are confidential and will not disclose them to any third party without the prior written consent of Processor.
4. Merchant shall comply with the Voyager Rules as amended from time to time. Processor may amend the Voyager Rules at any time. Submission by Merchant of Voyager Sales any time after 7 days from the date of distribution of amended Voyager Rules to Merchant’s address, shall be evidence that Merchant has received the amended Voyager Rules and has agreed to abide by them.

2. Processing Restrictions Due to Third Party Providers

Processor can only process Voyager Sales received by Processor, and Merchant is responsible for ensuring Voyager Sales are formatted and transmitted to Processor in accordance with the then current requirements of Processor and VFSI. Processor may increase processing fees if a third party presents Voyager Sales transactions not in accordance with the then current requirements. Merchant assumes full responsibility and liability for a Third Party Service Providers’ failure to comply with the Voyager Rules. Merchant is responsible for obtaining from the Third Party Service Provider any information needed by Processor. Merchant understands that disputes involving a Third Party Service Provider must be dealt with independently from Processor. If disputes are unresolved and relate to these Terms and Conditions, Merchant shall notify Processor at the address set forth below. Merchant must pay Processor pursuant to the Agreement and these Terms and Conditions regardless of any disputes Merchant has with any Third Party Service Provider.

3. Tax Calculation Payment and Amenities

1. Tax Liability: Merchant shall be liable for the reporting, calculating, remittance or payment of tax, interest, and penalties associated with the use of Voyager Cards at its location(s). Processor shall not be liable for and Merchant agrees to indemnify and hold harmless Processor, its parent, their subsidiaries and affiliates, and all of the foregoing entities’ respective officers, directors, employees, and agents from and against any claims, demands, or judgments, made or recovered against it, arising out of the reporting, calculating, and payment of tax associated with the use of the Voyager Card at Merchant location(s). Processor may defend on its own any such claims or demands or request Merchant to take up such defense. In either event Merchant will further indemnify Processor for reasonable attorney’s fees or any other necessary expenses incurred by Processor by reason of such defense.
2. Registration Form: For tax calculation purposes, Merchant shall be required to sign the Registration Form attached hereto and fully incorporated by this reference. Receipt of the signed registration form must be received by Processor prior to acceptance of any Voyager Cards by Merchant.

4. Voyager Discount Program and Discount  Payment

1. Participation in Voyager Discount Program: Merchant shall immediately notify Processor in writing if Merchant is participating in a Voyager Discount Program. Processor will begin processing the discount 60 days from the date Processor receives written notice of participation.
2. Liability Related to Discount Program: Merchant shall be liable for the reporting, calculating, remittance or payment of the discount. Processor shall not be liable for and Merchant agrees to indemnify and hold harmless Processor, its parent, their subsidiaries and affiliates, and all of the foregoing entities’ respective officers, directors, employees, and agents from and against any claims, demands, or judgments, made or recovered against it, arising out of the reporting, calculating, and payment of the discount. Processor may defend on its own any such claims or demands or request Merchant to take up such defense. In either event Merchant will further indemnify Processor for reasonable attorney’s fees or any other necessary expenses incurred by Processor by reason of such defense.

5. Rules

1. Merchant shall honor all valid Voyager Cards for purchases pursuant to the Agreement. Merchant shall check the expiration date and any printed restrictions for both electronic and manual transactions.
2. Merchant shall obtain a valid authorization for each transaction. Merchant shall bear all risks of accepting a Voyager Card without obtaining a valid authorization. If Merchant receives a decline, the Voyager Card shall not be used to complete the Voyager Sale. There shall be a $0.00 floor limit for all electronic transactions.
3. For customer-activated terminals, Merchant shall pre-authorize the Voyager Card to VFSI with values indicating that the Voyager Sale is a customer-activated transaction. Upon approval, Merchant shall ensure that the fuel dispenser authorizes for up to $150.00. It is the responsibility of Merchant to find a third-party processor or system integrator that is certified by VFSI to process Voyager transactions.
4. Merchant shall ensure that all cashier-assisted electronic sales drafts and credit vouchers are completed to include POS terminal print showing the Voyager Card account name encoded in the mag-strip (if POS function is applicable), account number (if permitted by Law), sub number, expiration date of the Voyager Card, the signature of the authorized user, the transaction date and time, type of fuel sold, a description of the service rendered (if requested), odometer reading (as permitted by the electronic POS device), total Voyager Sale price, and the authorization code.
5. Merchant shall not process manually prepared sales.
6. If there is a time-out or response message on the POS device indicating that the authorization system is unavailable, Merchant must telephone VFSI for assistance.
7. If an electronic authorization cannot be achieved at a card-activated POS device due to technical difficulties. The Voyager cardholder shall be referred to the station attendant if during Merchant’s open business hours.
8. Merchant shall establish a fair policy for the exchange and return of merchandise. Merchant shall promptly submit credits for any returns that are to be credited to the Voyager cardholder account.
9. Merchant shall not give any cash refunds to any Voyager cardholder in connection with a Voyager Sale.

Schedule IV – Clover Terms

1. Clover Service

DEFINITIONS: Capitalized terms used herein shall have the meanings given to such terms as set forth in this Addendum or as defined elsewhere in the Agreement.

• “Clover Marks” means the names, logos, emblems, brands, service marks, trademarks, trade names, taglines, or other proprietary designations of Clover Network, an affiliate of Processor.
• “Clover Service” means the website associated with the Clover Service, the object code version of Clover software applications (whether owned or licensed by Clover) resident on a Device at the time we provide you with the Device and the object code version of the software that enables the applications resident on a Device at the time of provisioning, and any related updates (including software maintenance or bug fixes) and any materials, documentation and derivative works released by Processor from time to time. For the avoidance of doubt, the term software in the preceding sentence does not include any software that may be obtained by you separately from the Clover Service (e.g., any applications or software downloaded by you through an application marketplace). The Clover Service is deemed part of the “Services,” as defined in and provided under the Agreement.
• “Customer” means a Person who makes a purchase of goods or services from you, the transaction for which utilizes the Clover Service.
• “Customer Information” means information about your Customers (e.g., name, mailing address, e-mail address, telephone number) obtained in connection with your use of the Clover Service.
• “Device” means a tablet, smartphone, or other mobile or fixed factor identified by Processor from time to time as compatible with and capable of supporting the Clover Service.
• “Third Party Services” are the services, products, promotions or applications provided by someone other than Processor.

2. License Grant

• During the term of this Addendum, Processor grants you a personal, limited, non-exclusive, revocable, non-transferable license, without the right to sublicense or assign in any way, to electronically access and use the Clover Service for your internal business use solely in the United States to manage your establishment and conduct associated point of sale activities within the United States in accordance with this Addendum.
• For the purposes of this Addendum, “United States” does not include U.S. Territories or possessions. The Clover Service is for your internal business use only. This Addendum does not grant you any rights to the Clover Marks. All intellectual property and proprietary rights in or related to the Clover Service and the Clover Marks are and will remain our, our affiliates’, our vendors’, or our licensors’ (as applicable) sole and exclusive property, and any and all right, title and interest associated with the Clover Service not expressly granted by Processor in this Addendum are deemed withheld.

3. Restrictions

1. All right, title and interest in and to all confidential information and intellectual property related to the Clover Service (including Clover Marks, all software, the content of any materials, web screens, layouts, processing techniques, procedures, algorithms, and methods and any updates, changes, alterations, or modifications to or derivative works from such intellectual property), owned, developed or licensed by us at any time or employed by us in connection with the Clover Service, shall be and will remain, as between us and you, our or our affiliates’, vendors’ or licensors’ (as applicable) sole and exclusive property and all right, title, and interest associated with the Clover Service not expressly granted by us in this Addendum are deemed withheld. You shall not use Clover Marks in any manner, including in advertisements, displays, or press releases, without our prior written consent.
2. Merchant shall obtain a valid authorization for each transaction. Merchant shall bear all risks of accepting a Clover Card without obtaining a valid authorization. If Merchant receives a decline, the Clover Card shall not be used to complete the Clover Sale. There shall be a $0.00 floor limit for all electronic transactions.
3. You shall not and shall not permit any third party to do any of the following: (a) access or attempt to access the Clover Service (or any part) that is not intended to be made available to you or made available for public use; (b) decompile, disassemble, reverse engineer, or otherwise attempt to reconstruct or discover by any means any source code, underlying ideas or algorithms of the Clover Service (or any part), except to the extent that such restriction is expressly permitted by law; (c) modify, translate, or alter in any manner, the Clover Service (or any part) or the Clover Marks; (d) create derivative works of or based on the Clover Service (or any part) or the Clover Marks; (e) except for backup and archival purposes, directly or indirectly copy the Clover Service (or any part); (f) republish, upload, post, transmit, disclose, or distribute (in any format) the Clover Service (or any part) except as permitted herein; (g) access or use (in any format) the Clover Service (or any part) through any time-sharing service, service bureau, network, consortium, or other means; (h) rent, lease, sell, sublicense, assign, or otherwise transfer your rights to any third party, whether by operation of law or otherwise; (i) use or ship the Clover Service (or any part) outside of the United States, or access the Clover Service (or any part) from outside the United States, without in any case obtaining our advance written consent; (j) remove, relocate, or otherwise alter any proprietary rights notices from the Clover Service (or any part) or the Clover Marks; (k) use or permit others to perform any actions that would interfere with the proper working of the Clover Service, prevent access to or use of the Clover Service by other users, or in our reasonable judgment impose an unreasonable or disproportionately large load on the Clover Service or its infrastructure; or (l) use the Clover Service (or any part) except as permitted in Section 2. You shall not take any action inconsistent with the stated title and ownership in Section 2. You will not file any action, in any forum that challenges the ownership of any part of the Clover Service, any related software, materials or documentation. Failure to comply with this provision will constitute a material breach of this Addendum. We have the right to immediately terminate this Addendum and your access to and use of the Clover Service in the event of a challenge by you.

4. Clover Service

1. You may access the Clover Service through your Device using a wired (Ethernet) or wireless (Wi-Fi or cellular) connection to the internet.
2. You may use the Clover Service to conduct point of sale activities. Transactions initiated offline will be queued until an internet connection is restored.
3. The Clover Service does not function with every mobile device. Processor may alter which devices are approved as compatible with the Clover Service in our discretion from time to time.
4. The default version and functionality of Clover software applications that are accessible at the time you acquire a device may vary from time to time as determined by Processor or an affiliate of Processor. Notwithstanding anything to the contrary herein, software for certain Clover devices may only be offered by Processor or an affiliate of Processor as applications via an application marketplace.
5. We may perform maintenance on the Clover Service from time to time, which may result in service interruptions, delays, or errors. We will not be liable for any such interruptions, delays, errors, or bugs. You agree that we may contact you in order to assist you with the Clover Service and obtain information needed to identify and fix any errors or malfunctions.
6. You shall at all times comply with any operating procedures, requirements, or guidelines regarding your use of the Clover Service that are posted on the Clover website or otherwise provided or made available to you (collectively, “Clover Ops Guide”).
7. You shall comply with the following requirements in connection with your use of the Clover Service:
   
   1. With respect to each of your Customers who requests the delivery of marketing materials, transaction receipts, or other communications from you via text message or email, such Customer must give his consent in writing or enter his phone number or email address in the appropriate space on the device and provide such consent via a check box himself on the Device. You are not permitted to add or modify any Customer Information (including but not limited to phone number and email address) or any Customer’s consent indication on behalf of a Customer.
   2. You (or your agents acting on your behalf) may only send marketing materials or other communications to the Customer’s provided phone number, street address, and/or email address if the Customer has specifically consented by checking (himself) the applicable box displayed on the Device.
   3. NOTWITHSTANDING THE CAPABILITY OF THE CLOVER SERVICE TO COLLECT AND STORE CUSTOMER INFORMATION AND TO ALLOW YOUR CUSTOMERS TO ELECT TO RECEIVE MARKETING MATERIALS FROM YOU, SOME STATES MAY LIMIT YOUR USE OF SUCH INFORMATION AND ONCE COLLECTED AND/OR YOUR DISCLOSURE OF SUCH INFORMATION TO THIRD PARTIES. YOU ACKNOWLEDGE AND AGREE THAT (I) YOUR USE OF INFORMATION OBTAINED IN CONNECTION WITH THE CLOVER SERVICE MAY BE SUBJECT TO LOCAL, STATE, AND/OR FEDERAL LAWS, RULES, AND REGULATIONS; AND (II) YOU WILL AT ALL TIMES STRICTLY COMPLY WITH ALL SUCH LAWS, RULES, AND REGULATIONS.
   4. You shall provide and obtain any disclosures and consents related to the E-SIGN Act that may be required in connection with your communications and agreements with your Customers through the Clover Service.

5. Third Party Services

1. The Clover Service may contain links to additional services provided by Processor or its affiliates as well as Third Party Services (e.g., an application marketplace). If you decide to use Third Party Services, you will be responsible for reviewing and understanding the terms and conditions associated with Third Party Services (including obtaining and maintaining any required third party hardware and/or software that is required for the Third Party Services to work with the Clover Service). Any access of or content downloaded or otherwise obtained through the use of Third Party Services is at your own risk. Third Party Services are not governed by the terms and conditions of this Addendum or the Agreement.
   ANY CONTENT DOWNLOADED OR OTHERWISE OBTAINED THROUGH THE USE OF THIRD-PARTY SERVICES (E.G., APPLICATION MARKETPLACE AND ANY APPS AVAILABLE AT SUCH APPLICATION MARKETPLACE) IS DOWNLOADED AT YOUR OWN RISK. PROCESSOR WILL NOT BE RESPONSIBLE FOR ANY ACTIONS OR ANY FAILURES TO ACT OF ANY THIRD PARTY, AND PROCESSOR EXPRESSLY DISCLAIMS ANY LIABILITY RELATED TO ALL THIRD PARTY SERVICES. PROCESSOR DOES NOT WARRANT, ENDORSE, GUARANTEE, OR ASSUME RESPONSIBILITY FOR ANY PROVIDER OF A THIRD PARTY SERVICE OR ANY THIRD PARTY SERVICE OR PRODUCT ADVERTISED OR OFFERED THROUGH THE CLOVER SERVICE OR ANY HYPERLINKED WEBSITE OR SERVICE, OR FEATURED IN ANY BANNER OR OTHER ADVERTISING, AND PROCESSOR WILL NOT BE A PARTY TO OR IN ANY WAY MONITOR ANY TRANSACTION BETWEEN YOU AND PROVIDERS OF THIRD PARTY SERVICES OR PRODUCTS.

6. Account Registration

1. We may require you to register and create a “Member” or “Merchant” account to use the Clover Service. If and when prompted by our registration process, you agree to (a) provide true, accurate, current and complete information about yourself and/or your business, and (b) maintain and update this information to keep it true, accurate, current and complete. If any information provided by you is untrue, inaccurate, not current or incomplete, we have the right to terminate your Clover Service account (“Account”) and refuse any and all current or future use of the Clover Service.

7. Privacy and Data Use

1. All data collected from you at www.clover.com or in connection with your use of the Clover Service, including Customer Information, transaction information, and information about your business and employees used with or stored in or by the Clover Services (collectively, “Account Data”), is collected by Clover Network, Inc. and not Processor or Bank; therefore, the use and sharing of such Account Data is controlled by the Clover Network, Inc. Privacy Policy (available at https://www.clover.com/privacy-policy). You acknowledge and agree that we may access your Account Data upon our request to Clover, and our use of your Account Data is governed by the terms set forth in the Agreement.

8. Protecting Your Information

1. You are solely responsible for ensuring that your account numbers, passwords, security questions and answers, login details and any other security or access information used by you to use or access the Clover Service are kept safe and confidential. You must prevent unauthorized access to and use of any Account Data. You are responsible for all electronic communications sent to us or to any third party (including Clover Network,) containing Account Data and for all uses of the Clover Service or any software provided or approved by Processor to authenticate access to, and use of, the Clover Service and any software. When we receive communications containing Account Data, we assume you sent it to us. Processor has the right to rely on user names, passwords and other sign-on credentials, access controls for the Clover Service or any software provided or approved by Processor to authenticate access to, and use of, the Clover Service and any software. You must immediately notify us if you become aware of any loss, theft or unauthorized use of any Account Data (see Clover Service support center contact information below). We reserve the right to deny you access to the Clover Service, in whole or in part, if we believe that any loss, theft or unauthorized use of Account Data or access information has occurred.
2. You may submit comments or ideas about the Clover Service, including, without limitation, about how to improve the Clover Service. By submitting any idea, you agree that:
   
   1. we expressly disclaim any confidentiality obligations or use restrictions, express or implied, with respect to any idea;
   2. your submission will be non confidential; and
   3. we are free to use and disclose any idea on an unrestricted basis without notifying or compensating you. You release us from all liability and obligations that may arise from our receipt, review, use or disclosure of any portion of any idea.

9. Accuracy of Information

1. You are solely responsible for ensuring the accuracy, quality, integrity, legality, and appropriateness of all information and data regarding your business that you provide to us or our service providers in connection with the Clover Service. Additionally, you are solely responsible for verifying that all information and data loaded onto a Device by us or our service providers at your request are accurate before your business use of such Device. We and our service providers disclaim any and all liability arising from any inaccuracies regarding such information or data you provide.

10. Clover Service Disclaimer

1. USE OF THE CLOVER SERVICE IS AT YOUR OWN RISK. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE CLOVER SERVICE IS PROVIDED “AS IS” AND PROCESSOR MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND (EXPRESS OR IMPLIED) TO YOU OR ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, WARRANTIES REGARDING QUALITY, SUITABILITY, ACCURACY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT, OR THAT THE CLOVER SERVICE WILL FUNCTION OR OPERATE UNINTERRUPTED OR ERROR-FREE, OR THAT THE CLOVER SERVICE IS SECURE, FREE OF VIRUSES OR OTHER HARMFUL COMPONENTS, OR DOES NOT INFRINGE ON THE RIGHTS OF ANY PERSON.

11. Indemnity

1. Without limiting your indemnification obligations in the Agreement, you agree to indemnify and hold us harmless from and against all losses, liabilities, damages, and expenses (including reasonable attorneys' fees) arising out of or relating to:
   
   1. Your failure to comply with all terms and conditions in this Addendum, including but not limited to the Clover Ops Guide;
   2. Your use of any Customer Information obtained in connection with your use of the Clover Service;
   3. The content or delivery of any marketing messages that you send or cause to be sent to any Customer phone number or email address collected through the use of the Clover Service; or
   4. Any other party’s access and/or use of the Clover Service with your user names, password, other appropriate security code, or any other sign on credentials/access controls for the Clover Service or any software provided by or approved by us to authenticate access to, and use of, the Clover Service and any software.

12. Bundles

1. By selecting the Data Protection Service, the terms and conditions set forth in Section 13 shall apply. By selecting the TransArmor Solution Services, the terms and conditions set forth in Section 79 shall apply (and certain provisions of Section 2 as incorporated therein and set forth below).

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DATA PROTECTION

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13. Data Protection Service

If you elect the Data Protection Service, the terms and conditions set forth in this Section 13 shall apply.

DEFINITIONS:  Capitalized terms used herein shall have the meanings given to such terms as set forth in this Addendum or as defined elsewhere in the Agreement.

• “Data Protection Service” or “Encryption and Tokenization” means those services described in Section 15 below.

• “Multi-Pay Token”  means the option to support businesses that need to submit a financial transaction in a card-not-present situation. These tokens are unique to each merchant that uses them and are stored in place of the primary account number (PAN). With these tokens, merchants can initiate new or recurring payments in their own environment instead of using the original card number. Multi-Pay Token allows a Token Registration to process a non-financial transaction to request a token to be placed in their payment page or e-wallet for future or recurring payments. It is common for e-commerce merchants to ask their customers to register by providing profile information such as name, address, and phone number to the merchant website before or upon checkout.

• “Registered PAN” means the processing of creating a Client Specific Token for a PAN.

• “Token/Tokenization” means a form of data substitution replacing sensitive payment card values with non-sensitive token, or random-number, values. Post-authorization transactions are handled via Processors Safe Proxy tokenization technology, which returns a token with the transaction’s authorization to the merchant. Tokens are shared universally with other merchants and cannot be used to initiate a financial transaction. 

• “Token Request” means your ability to obtain a Multi PayToken for credit card information only without an immediate authorization required which permits you to store a Multi-Pay Token for future transactions involving its customer.

14. Grants of License

1. Subject to the terms of this Addendum, Processor grants to you a non-transferable, non-assignable, non-exclusive, revocable sub-license during the term of this Addendum to use the Data Protection Service and the Data Protection Service Marks (as identified in the Data Protection Rules and Procedures) in the United States in accordance with this Addendum, including without limitation the Data Protection Rules and Procedures. Any rights with respect to the Data Protection Service not expressly granted by Processor in this Addendum are deemed withheld.

15. Services

1. The Data Protection Service applies only to Card transactions sent from you to us for authorization and settlement pursuant to the Agreement, and specifically excludes electronic check transactions. Processor will provide an encryption key to you to be used to encrypt (make unreadable) Card data during transport of the authorization request from your point of sale to Processor’s systems. During the period when the transaction is being transmitted to Processor for authorization processing, all historical transaction data, including Card number and full magnetic stripe data (track data and expiration date), will be encrypted. Processor will then generate or retrieve a unique, randomly generated token assigned to the Card number that will be returned to you in the authorization response (the “Token”).

16. Responsibilities of Clients

You are responsible to comply with the following regarding your use of the Data Protection Service:

1. You are required to comply with the Card Organization Rules, including taking all steps required to comply with the Payment Card Industry Data Security Standards (PCI DSS). You must ensure that all third parties and software used by you in connection with your payment processing are compliant with PCI DSS. Use of the Data Protection Service will not, on its own, cause you to be compliant or eliminate your obligations to comply with PCI DSS or any other Card Organization Rule. You must demonstrate and maintain your current PCI DSS compliance certification. Compliance must be validated either by a Qualified Security Assessor (QSA) with a corresponding Report on Compliance (ROC) or by successful completion of the applicable PCI DSS Self-Assessment Questionnaire (SAQ) or Report on Compliance (ROC), as applicable, and if applicable to your business, passing quarterly network scans performed by an Approved Scan Vendor, all in accordance with Card Organization Rules and PCI DSS.
2. Use of the Data Protection Service is not a guarantee against an unauthorized breach of your point of sale systems or any facility where you process and/or store transaction data (collectively, “Merchant Systems”).
3. You must deploy the Data Protection Service (including implementing any upgrades to such service within a commercially reasonable period of time after receipt of such upgrades) throughout your Merchant Systems including replacing existing Card numbers on your Merchant Systems with Tokens. Full Card numbers must never be retained, whether in electronic form or hard copy.
4. You must use the Token in lieu of the Card number for ALL activities subsequent to receipt of the authorization response associated with the transaction, including, without limitation, settlement processing, retrieval processing, chargeback and adjustment processing, and transaction reviews.
5. If you send or receive batch files containing completed Card transaction information to/from Processor, you must use the service provided by Processor to enable such files to contain only Tokens or truncated information.
6. You must use truncated report viewing and data extract creation within reporting tools provided by Processor.
7. You are required to follow rules or procedures we may provide to you from time to time related to your use of the Data Protection Service ("Data Protection Rules and Procedures"). We will provide you with advance written notice of any such rules or procedures or changes to such rules or procedures.
8. You have no right, title, or interest in or to the Data Protection Service, any related software, materials or documentation, or any derivative works thereof, and nothing in this Addendum assigns or transfers any such right, title or interest to you. You shall not take any action inconsistent with the stated title and ownership in this Addendum. You will not file any action, in any forum, that challenges the ownership of the Data Protection Service, any related software, materials or documentation. Failure to comply with this provision will constitute a material breach of this Addendum. We have the right to immediately terminate this Addendum and your access to and use of the Data Protection Service in the event of a challenge by you. No additional rights are granted by implication, estoppel or otherwise.
9. You will not: (1) distribute, lease, license, sublicense or otherwise disseminate the Data Protection Service or any portion of it to any third party; (2) modify, enhance, translate, supplement, create derivative works from, reverse engineer, decompile or otherwise reduce to human-readable form the Data Protection Service or any portion of it; (3) sell, license or otherwise distribute the Data Protection Service or any portion of it; (4) make any copies, or permit any copying, of the Data Protection Service or any portion of it as a standalone program or in any way independently from the Data Protection Service; or (5) use any portion of the Data Protection Service as a standalone program or in any way independently from the Data Protection Service. If any portion of the Data Protection Service contains any copyright notice or any other legend denoting the proprietary interest of Processor or any third party, you will not remove, alter, modify, relocate or erase such notice or legend on such item.
10. You will only use the Data Protection Service for your internal business purposes in a manner consistent with this Addendum.
11. You will use only unaltered version(s) of the Data Protection Service and will not use, operate or combine the Data Protection Service or any related software, materials or documentation, or any derivatives thereof with other products, materials or services in a manner inconsistent with the uses contemplated in this Addendum.
12. You will promptly notify us of a breach of any terms of this Addendum.

17. Tokenization Limited Warranty

1. Processor warrants that the Token returned to you, as a result of using the Data Protection Service, cannot be used to initiate a financial sale transaction by an unauthorized entity/person outside the Merchant Systems. This warranty by Processor is referred to herein as the “Limited Warranty” and is subject to the terms and conditions set forth in this Addendum. To be eligible for the Limited Warranty, you must maintain a processing relationship with Processor and be in compliance with all the terms of the Agreement, including this Addendum, and any other agreement relating to Cards eligible for the Data Protection Service. Subject to the terms, conditions and limitations set forth in the Agreement, including the limitation of liability provisions, Processor agrees to indemnify and hold you harmless from direct damages, including third party claims, resulting from Processor’s breach of the Limited Warranty. The express remedy for Processor’s breach of the Limited Warranty set forth in this paragraph constitutes Processor’s entire liability and your sole and exclusive remedy for Processor’s breach of the Limited Warranty. The Limited Warranty is void if (i) you use the Data Protection Service in a manner not contemplated by, or in violation of, the Agreement, including this Addendum, or any other agreement relating to Cards eligible for the Data Protection Service; or (ii) you are grossly negligent or engage in intentional misconduct.

18. Data Protection Disclaimer

1. IN ADDITION TO THE DISCLAIMERS SET FORTH IN THE AGREEMENT, THE FOLLOWING DISCLAIMER APPLIES TO THE DATA PROTECTION SERVICE: EXCEPT AS EXPRESSLY PROVIDED IN THIS ADDENDUM, PROCESSOR MAKES NO REPRESENTATIONS, WARRANTIES OR COVENANTS, EXPRESS OR IMPLIED WITH REGARD TO THE DATA PROTECTION SERVICE INCLUDING THE UNINTERRUPTED OR ERROR-FREE OPERATION OF THE DATA PROTECTION SERVICE.

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TRANSARMOR SOLUTION

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19. TransArmor Solution Services

If you elect the TransArmor Solution Services, the terms and conditions set forth in this Section 19 shall apply.

DEFINITIONS: Capitalized terms used herein shall have the meanings given to such terms as set forth in this Addendum or as defined elsewhere in the Agreement.

• “Cardholder Information” means the data contained on a Card or otherwise provided to Customer, that is required by the Card Organization as the result of (i) a Data Security Event; or (ii) a security assessment conducted as the result of a Data Security Event; the Card Organizational Assessment shall not exceed the maximum monetary assessment, fee, fine or penalty permitted upon the occurrence of a “Data Security Event” by the applicable rules or agreement in effect as the inception date of this Addendum for such Card Organization;
• “Card Replacement Expenses” means the costs that we or you are required to be paid by the Card Organization to replace compromised Cards as the result of (i) a Data Security Event; or (ii) a security assessment conducted as the result of a Data Security Event;
• “Data Security Event” means the actual or suspected unauthorized access to or use of Cardholder Information, arising out of your possession of or access to such Cardholder Information, which has been reported (i) to a Card Organization by you or us; and (ii) to you or us by a Card Organization. All Security Event Expenses and Post Event Services Expenses resulting from the same, continuous, related or repeated event or which arise from the same, related or common nexus of facts, will be deemed to arise out of one Data Security Event;
• “EMV Upgrade Costs” means cost to upgrade payment acceptance and processing hardware and software to enable you to accept and process EMV-enabled Card in a manner compliant with PCI Data Security Standards;
• “Forensic Audit Expenses” means the costs of a security assessment conducted by a qualified security assessor approved by a Card Organization or PCI Security Standards Council to determine the size and extent of a Data Security event;
• “Liability Waiver” has the meaning as set forth in Section 24 below;
• “Pollutants” means, but are not limited to, any solid, liquid, gaseous, biological, radiological or thermal irritant or contaminant, including smoke, vapor, dust, fibers, mold, spores, fungi, germs, soot, fumes, asbestos, acids, alkalis, chemicals and waste. “Waste” includes, but is not limited to, materials to be recycled, reconditioned or reclaimed and nuclear materials; and
• “Post Event Services Expenses” means reasonable fees and expenses incurred by us or you with our prior written consent, for any service specifically approved by us in writing, including without limitation, identity theft education and assistance and credit file monitoring. Such services must be provided by or on behalf of us or you within one (1) year following discovery of a Data Security Event to a Cardholder whose Cardholder Information is the subject of that Data Security Event for the primary purpose of mitigating the effects of such Data Security Event;
• “Program Year” means the period from June 1st through May 31st of each year; and
• “Security Event Expenses” means Card Organization Assessments, Forensic Audit Expenses and Card Replacement Expenses. Security Event Expenses also includes EMV Upgrade Costs you agree to incur in lieu of a Card Organization Assessment.
• “TransArmor Solution Services” or “TransArmor Solution Services Full Bundle” those services described in Section 20 below.

20. TransArmor Solution Services

The following is a description of the TransArmor Solutions Services available to you, subject to the terms of this addendum. The TransArmor Solution Services are available during a calendar year only if you have less than 1 million Visa Card transactions and less than 1 million MasterCard transactions in such year.

1. Data Protection: The terms and provisions of Sections 13-18 are incorporated in this Section 20 and made a part of Section 20.
2. POS software monitor (“POS Software Monitor”) that provides a suite of monitoring, scanning, and anti-virus software services to help protect point of sale computer systems;
3. PCI Rapid Comply (“PCI Rapid Comply Service”) which provides access to online PCI DSS Self-Assessment Questionnaires (SAQ) to validate PCI data standards. If an internet scan is required to complete the SAQ, you will have access to such scanning services;
4. POS hardware monitor (“POS Hardware Monitor”) which is a tool to assist in detecting physical terminal tampering and substitution, in accordance with additional terms and conditions provided to you upon downloading the POS Hardware Monitor.

21. POS Software Monitor

1. Software as a Service: Subject to the terms and conditions of this Addendum, we agree to provide you with the POS Software Monitor software application, including all updates, upgrades, new versions, and other enhancements or improvements thereto (the “Software”), to the extent the applicable fees are paid. You hereby authorize us or our vendors to begin scanning immediately upon your installation and/or deployment of the Software. The Software can only be used with certain computer operating systems. It is your responsibility to ensure that your computer has the software in order to use the POS Software Monitor.
2. License Grant: Subject to the terms of this Addendum, we hereby grant to you a non-exclusive, non-transferable, non-assignable, revocable sub-license during the term of this Addendum to: (i) access and use the Software solely for the benefit of you and only for systems owned or licensed by you; (ii) access and use the Software solely for its intended use; and (iii) use all applicable end user documentation provided.
3. Revocation of  License: Upon expiration or termination of the Agreement or this Addendum for any reason, your license shall automatically be revoked. Furthermore, your right to use or access the Software shall cease.

22. IP & Other Data Retrieval, Transmission and Scanning

1. IP/Data Retrieval and Transmission:  You hereby grant us or our vendors the right to retrieve, transmit, and monitor, for the intended purpose of the POS Software Monitor, any dynamic or static IP address and other data, including without limitation policy and system settings, point of sale system type, version, security event logs, or other related information, from any system with the POS Software Monitor loaded, deployed, or otherwise installed. You shall not, in any event or in any manner, impede the retrieval or transmission of such IP addresses or data. You hereby assume full responsibility for all damages and losses, of any nature, for all adverse results caused by your impeding the retrieval and transmission of the IP addresses and data. You further agree to defend, indemnify, and hold us harmless from any third-party claim resulting from your impeding this process.
2. IP Scanning & Log Monitoring: You acknowledge and understand that provisioning of the Software will enable static or dynamic IP addresses associated with the POS Software Monitor to be scanned. You further acknowledge that such IP addresses may be for external network devices which protect the POS Software Monitor host system. You hereby grant us and our vendors: (i) the right to access and scan the IP addresses associated with the POS Software Monitor whether they are dynamic or static IP addresses (the “Authorized IP Addresses”); (ii) the right and authority to gather and transmit system data, including point of sale system information, to us or our vendors; and (iii) the right and authority to collect, transmit and review security event logs from the systems on which the Software is deployed. You further agree to provide us or our vendors reasonable assistance to enable such access and scanning. You understand that your failure to cooperate with the provision of services may significantly impair the services.
3. Updates: You acknowledge and understand that the POS Software Monitor, in our sole discretion, can automatically install, download, and/or deploy updated and/or new components (“update process”), which may include a new version of the POS Software Monitor itself. You shall not, in any event or in any manner, impede the update process. You hereby assume full responsibility for all damages and losses, of any nature, for all adverse results caused by your impeding the update process. You agree to defend, indemnify, and hold us harmless from any third-party claim resulting from your impeding the update process.
4. Authorized Disclosure: You acknowledge that, in conjunction with providing the Software, we may make certain “pass” or “fail” determinations regarding your online security and the vulnerability of your IP addresses. You hereby authorize us or our vendors to share these “pass/fail” results, point of sale data, and other information collected during the scans to Card Organizations, Payment Card Industry Security Standards Council, or any Card Organization sponsor bank.

23. PCI Rapid Comply Service

1. License Grant: Subject to the terms of this Addendum, we hereby grant to you a non-exclusive, non-transferable, non-assignable, revocable sub-license to: (i) access and use the PCI Rapid Comply Service solely for the benefit of you and only on a single computer or computer network owned or licensed by you; (ii) access and use the PCI Rapid Comply Service solely for its intended use; and (iii) use all applicable end-user documentation. Upon expiration or termination of the Agreement or this Addendum for any reason, your license shall automatically be revoked. Furthermore, your right to use or access the PCI Rapid Comply Service shall automatically be revoked. Furthermore, your right to use or access the PCI Rapid Comply Service shall cease.
2. Access: You acknowledge and agree that, although you will generally have access to the PCI Rapid Comply Service twenty-four hours per day, seven days per week (except in the event of a force majeure event), access to customer accounts and certain other services may not be available on a continuous basis and the PCI Rapid Comply Service will be subject to periodic downtime to permit, among other things, hardware and/or software maintenance to take place.
3. Data Disposal: From time to time, your account data or information, which is over 180 days old, may be deleted, purged, or otherwise disposed. In addition, only a limited amount of data or information may be available. Therefore, you are advised to print and download your account data and information, for record-keeping purposes, on a periodic basis. You specifically agree that we are authorized to delete or dispose of your data or information and shall not be responsible for the deletion or disposal of your data or information from the PCI Rapid Comply Service. You assume full responsibility to backup and/or otherwise protect your data against loss, damage, or destruction prior to and during all phases of the PCI Rapid Comply Service, and to take appropriate measures to respond to any potential adverse impact of the systems or disruption of service.
4. Copyrighted Material: The PCI Rapid Comply Service (including the website), contains copyrighted material, trademarks, and other proprietary information, including, but not limited to, text, software, photos, video, and you may not modify, publish, transmit, participate in the transfer or sale, create derivative works, or in any way exploit any of the content, in whole or in part, whether copyrighted, trademarked, or proprietary, or otherwise. You may download copyrighted material solely for your own internal use as contemplated under this Addendum. Except as expressly provided by copyright law, any copying, redistribution, or publication must be with the express permission of the owner. In any copying, the redistribution or publication of copyrighted material and any changes to or deletion of author attribution or copyright notice is expressly prohibited.
5. TransArmor Solution Services PCI Only: To the extent you elect the Data Protection Service set forth in Section 13 above, but still want a PCI service, as set forth on the first page above, you may separately elect to receive the PCI Rapid Comply Service.

24. Liability Waiver

1. Data Security Event Expenses: Subject to the limitations, terms and conditions of this Section 24, we agree to waive liability (the “Liability Waiver”) that you have to us under the Agreement for Security Event Expenses and Post Event Services Expenses resulting from a Data Security Event first discovered by you or us while this Addendum is in effect. Except for the Liability Waiver for expenses as specifically set forth in this Addendum, (i) you remain responsible to perform all agreements and obligations under the Agreement and this Addendum including, without limitation, your obligation to comply with data security requirements; and (ii) we waive no rights or remedies under your Agreement including, without limitation, our right to terminate the Agreement in the event of a Data Security Event.
2. Maximum Waiver Amount:
   1. The maximum amount of liability that we shall waive under the Agreement for all Security Event Expenses and Post Event Services Expenses arising out of or relating to your Data Security Events first discovered during any Program Year regardless of the number of such Data Security Events is as follows:
      1. $100,000.00 maximum per each MID (merchant identification number) you have; and
      2. $500,000 aggregate maximum for all of your MID’s.
   2. The maximum amount of liability during any Program Year that we will waive:
      1. $10,000 maximum per each MID you have; and
      2. $25,000 aggregate maximum for all of your MIDs.

For avoidance of doubt, the limit set forth in this Section 24.2B is part of and not in addition to the maximums set forth in Section 24.2A.

25. Duties in the Event of Data Security Breach

1. You shall contact us immediately and, as directed by us, investigate, perform all remedial actions and cooperate fully with us, in the event of a Data Security Event. In all events, you shall not take any action, or fail to take any action, without our prior written consent, which prejudices our rights hereunder.
2. Under all circumstances, you shall not admit any liability, assume any financial obligation, pay any money, or incur any expense in connection with any Data Security Event without our prior written consent. If you do so, it will be at your own expense.

26. Exclusions

The Liability Waiver hereunder shall not apply to:

1. Any Security Event Expenses and Post Event Services Expenses arising out of or resulting, directly or indirectly, from any dishonest, fraudulent, criminal, or malicious act, error, or omission, or any intentional or knowing violation of the law, if committed by you or your employees, officers, agents, or director;
2. Any Security Event Expenses and Post Event Services Expenses arising out of or resulting from a claim, suit, action, or proceeding against you that is brought by or on behalf of any federal, state, or local government agency;
3. Any Data Security Event relating to you which has experienced a prior Data Security Event unless you were later certified as PCI compliant by a qualified security assessor;
4. Any Data Security Event arising out of your allowing any party (other than its employees or us) to hold or access Cardholder Information;
5. Any Data Security Event if Client: (i) is categorized by any Card Organization as “Level 7” or (ii) processes more than six million (6,000,000) Card transactions during the twelve (12)-month period prior to the date this Addendum became effective;
6. Any expenses, other than Security Event Expenses and Post Event Services Expenses, incurred by you arising out of or resulting, directly or indirectly, from a Data Security Event, including without limitation, expenses incurred to bring you into compliance with the PCI Data Security Standard or any similar security standard;
7. Any Security Event Expenses, and Post Event Services Expenses arising out of or resulting, directly or indirectly, from physical injury, sickness, disease, disability, shock, or mental anguish sustained by any person, including without limitation, required care, loss of services, or death at any time resulting therefrom;
8. Any Security Event Expenses, and Post Event Services Expenses arising out of or resulting, directly or indirectly, from any of the following:
9. Any Security Event Expenses, and Post Event Services Expenses arising out of or resulting, directly or indirectly, from the presence of or the actual, alleged, or threatened discharge, dispersal, release, or escape of Pollutants, or any direction or request to test for, monitor, clean up, remove, contain, treat, detoxify, or neutralize pollutants, or in any way respond to or assess the effects of pollutants;
10. Your failure to comply with this Addendum or the Agreement in connection with a Data Security Event;
11. Any Data Security Event occurring before the effective date of this Addendum;
12. Any expenses incurred for, or as a result of, regularly scheduled, recurring or routine security assessments, regulatory examinations, inquiries or compliance activities;
13. Any fines or assessments levied against you that are not the direct result of a Data Security Event;
14. Any Data Security Event arising out of any software not within your control; provided, however, this exclusion shall not apply to a Data Security Event arising out of a virus, Trojan horse or other software used by a third party to obtain fraudulent access to data to your computer system or to collect data in transit to or from your computer system; or
15. Any Data Security Event arising out of a breach in a computer system in which you and other merchants, with no legal relationship to one another, have hosted accounts or share a common database, operating system or software applications.

27. Processor Technology and IP

1. All technology used by us or our licensors in connection with performing the TransArmor Solution Services, including software, portals, data processing systems (each of the foregoing, in object code and source code form), report templates, documentation, and materials (collectively, “Processor Technology”), and any of our or our licensors' patents, trademarks, copyrights, trade secrets, and other intellectual property (“Processor IP”), and any derivative works of or modifications to the Processor Technology or Processor IP, is the sole and exclusive property of, and is valuable, confidential, and proprietary to, Processor or its licensors. Except as otherwise expressly provided herein, you shall not acquire any rights in any Processor Technology or IP as a result of receiving the TransArmor Solution Services. You will not file any action, in any forum, that challenges the ownership of the Processor Technology or Processor IP. Failure to comply with this provision will constitute a material breach of this Addendum. We have the right to immediately terminate your access to and use of the TransArmor Solution Services in the event of a challenge by you. No additional rights are granted by implication, estoppel, or otherwise.

28. Processor Technology and IP

1. In the course of providing the TransArmor Solution Services, we may collect information relating to activities on your network (the “Data”), including, but not limited to, network configuration, TCP/IP packet headers and contents, log files, malicious codes, and Trojan horses. We retain the right to use the Data or aggregations thereof for any reasonable purpose.

29. Service Does Not Guarantee Compliance or Security

1. You acknowledge and agree that your use of the TransArmor Solution Services does not guarantee your compliance with any of the rules or security standards established by the Card Organizations. You further acknowledge and agree that your use of the TransArmor Solution Services does not guarantee the security of your IP addresses or that your systems are secure from unauthorized access. You are responsible for establishing and maintaining your own security policies and procedures, and for compliance with the Card Organization Rules and security standards, including any obligation to notify a Card Organization and/or us of any suspected breach of your systems or any suspicious transactions or fraudulent activity. You are responsible for any fines or penalties imposed by any Card Organization or any other expenses and liabilities pursuant to the Agreement less only the benefits to which you may be entitled under the Liability Waiver provisions of this Addendum. In the event of a suspected breach of your systems or any suspicious transactions or fraudulent activity, you authorize us to share the details of any questionnaire or compliance report with the Card Organizations, and grant us and our vendors the right to access and perform a scan of the IP addresses identified within your profile. You agree and authorize payment for the additional scan. You further agree to cooperate with an investigation into such matter to include complying with the Card Organization and us pursuant to the terms of the Agreement.

1. In addition to your obligations under the Agreement to comply with all laws, you are solely responsible for monitoring legal developments applicable to the operation of your business, interpreting applicable laws and regulations, determining the requirements for compliance with all applicable laws and regulations, and maintaining an ongoing compliance program.

30. Scanning Authority: Scanning Obligations

1. You represent and warrant that you have full right, power, and authority to consent for the TransArmor Solution Services to scan for vulnerabilities the IP address and/or URL and/or domain names identified to us by you for scanning, whether electronically or by any other means, whether during initial enrollment or thereafter. If applicable, you shall obtain all consents and authorizations from any third parties necessary for us or our vendors to perform the TransArmor Solution Services, including, without limitation, third party data centers, co-locations and hosts. We will not be required to execute agreements with any such third parties. You agree to defend, indemnify and hold us and our vendors harmless from any third-party claim that such access was not authorized. You may use the TransArmor Solution Services and portals only to scan IP addresses, URLs and domain names owned by and registered to you. You understand that your failure to provide a complete list of and complete access to your IP addresses will significantly impair the scanning services and may result in incomplete or inaccurate results. You agree that all TransArmor Solution Services hereunder, including without limitation their functionality and contents, is confidential information, and Client’s use and/or access to the TransArmor Solution Services is subject to the terms of Confidentiality in the Agreement.

31. Scanning Risks

1. You acknowledge and understand that accessing, retrieving, transmitting, and scanning IP addresses and other data involves inherent risks, including, without limitation, risks related to system or network performance and availability, and data corruption. You assume full responsibility to backup and/or otherwise protect your data against loss, damage or destruction, and to take appropriate measures to respond to any potential adverse impact of the systems or disruption of service.

32. Use of TransArmor Solution Services and Portals

1. Your use of our or our vendors’ services, portals, reports, and scanning solution is subject to the following restrictions: (i) TransArmor Solution Services, portals, and reports may only be used for the stated purposes in this Addendum for your internal business purposes in accordance with all applicable laws (including any export control laws); (ii) TransArmor Solution Services and portals utilized for scanning may only scan IP addresses, URLs and domain names owned by and registered to you; and (iii) you shall limit access to the portals to only those employees and/or contractors who have an obligation of confidentiality with you and only to those who have a requirement for such access on a “need to know” basis and you shall be solely responsible for disabling portals accounts for those employees and/or contractors who no longer require access. You shall promptly notify us of any unauthorized use of the TransArmor Solution Services. You shall not: (i) decompile, reverse engineer, disassemble, or otherwise derive the source code from any component of the TransArmor Solution Services or portals including the software embedded therein; (ii) modify, enhance, translate, alter, tamper with, upgrade or create derivative works of the portals, software or documentation; (iii) distribute, lease, license, sell, assign, sublicense or otherwise disseminate or transfer its rights to use any portion of the TransArmor Solution Services to any third party; or (iv) strip out or alter any trademark, service mark, copyright, patent, trade secret, ownership or any other proprietary or Intellectual Property notices, legends, warnings, markings or indications on or within any component of the portals, software or documentation, or attempt (i), (ii), (iii) and/or (iv) above. You shall notify us immediately if you know, suspect or have reason to know that you or anyone you have granted access to the TransArmor Solution Services violated any provision of this Addendum. Further you agree not to share your personal information (ODA, tax ID, MID, etc.) with a third party so they may gain access to the TransArmor Solution Services.

33. Disclaimers

1. We do not make and hereby expressly disclaim all representations or warranties including, without limitation: (i) that access to the TransArmor Solution Services will be uninterrupted or error-free; (ii) that security breaches will not occur with respect to any information communicated through the TransArmor Solution Services, the Internet, or any common carrier communications facility; and (iii) as to the results that may or may not be obtained by you in connection with your use of the TransArmor Solution Services.
   WE DO NOT MAKE ANY WARRANTY, GUARANTEE OR REPRESENTATION (EITHER EXPRESS OR IMPLIED) OF ANY KIND INCLUDING, WITHOUT LIMITATION, THE MERCHANTABILITY, TITLE, NONINFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE OF ANY SERVICES PROVIDED UNDER THIS ADDENDUM, AND ALL SUCH WARRANTIES, GUARANTEES AND REPRESENTATIONS ARE HEREBY EXPRESSLY DISCLAIMED. ALL SERVICES PROVIDED UNDER THIS ADDENDUM ARE PROVIDED ON AN “AS IS, WITH ALL FAULTS.” USE OF THE SERVICES DOES NOT GUARANTY SECURITY OR PREVENT A SECURITY BREACH OR COMPROMISE. WE MAKE NO WARRANTIES, EITHER EXPRESSED OR IMPLIED THAT PARTICIPATION AND/OR USE OF OUR SERVICES WILL DETECT EVERY VULNERABILITY ON YOUR SYSTEM, IF ANY, OR THAT OUR VULNERABILITY ASSESSMENTS, SUGGESTED SOLUTIONS OR ADVICE WILL BE ERROR-FREE OR COMPLETE. CUSTOMER AGREES THAT WE SHALL NOT BE RESPONSIBLE OR LIABLE FOR THE ACCURACY OR USEFULNESS OF ANY INFORMATION PROVIDED BY US, OR FOR ANY USE OF SUCH INFORMATION.
2. You acknowledge and agree that we shall not be liable to you for any claims, damages, losses, obligations, costs or expenses or other liability arising directly or indirectly from or otherwise concerning: (i) any termination, suspension, delay or disruption of service (including billing for a service) by the Internet, any common carrier or any service provider; (ii) any failure, disruption or malfunction of any of the TransArmor Solution Services, the Internet, or any communications network, facility or equipment beyond our or a third party’s reasonable control, whether or not attributable to one or more common carriers; (iii) your failed attempts to access the TransArmor Solution Services or to complete transactions via any of the TransArmor Solution Services; (iv) any failure to transmit, obtain or collect data or any machine or software errors or faulty or erroneous input by you; (v) any damages resulting from any delays and/or losses arising in connection with the TransArmor Solution Services provided hereunder; or (vi) any loss of or inability to access data or information generated by TransArmor Solution Services.

34. Limitation of Liability

1. Notwithstanding anything to the contrary in this Addendum or elsewhere, our cumulative liability to you for any claim related to this Addendum, and your use of the Services (whether arising from tort, statute, contract or otherwise) shall in all cases be limited to the actual, direct and proven out-of-pocket losses, damages or expenses suffered or incurred by you. Furthermore, our cumulative liability to you shall not, in any case, exceed the TransArmor Solution Fees paid to us by you during the twelve (12) month period immediately preceding the date the event giving rise to the claim occurred. Notwithstanding anything to the contrary in this Addendum or elsewhere, in no event shall we be liable to you or to any third party for any indirect, special, incidental, consequential, punitive or unproven losses, damages or expenses of any kind, including, without limitation, lost profits or loss of goodwill arising from the use or inability to use the Services including, without limitation, the inability to access your data or information generated or stored on the Services, and regardless of whether such claim arises in tort, in contract or by statute or regulation, each of which is hereby excluded, regardless of whether such damages were foreseeable or whether you have been advised of the possibility of such damages. The parties acknowledge and agree that the provisions and limitations of Section 34 are of the essence of this Addendum and that absent them, the parties would not have agreed to this Addendum.

35. Miscellaneous: Termination

1. Except as may be provided in the Agreement, a person who is not a party to this Addendum shall have no rights or remedies under this Addendum. Our obligations hereunder are subject to our ability to obtain and maintain any and all required governmental licenses, permits or other authorizations, and our ability to comply with any and all laws, regulations, orders and other governmental directives which may be imposed related to the TransArmor Solution Services. We may terminate any or all of the TransArmor Solution Services at any time for any reason.

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GENERAL TERMS

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36. Fees

1. Service Fees: You shall pay Processor the fees for Services as set forth (a) on the first page above; (b) in the Merchant Processing Application; or (c) in the lease agreement or equipment purchase agreement, as applicable. Processor may increase your fees for the Services as provided in your Agreement.
2. Processing Fees: Processing fees for transactions processed in connection with the use of the Services are the same as for non-Services transactions, which are set forth in the Application.
3. High Risk Violation Fees: We reserve the right to assess additional processing fees for activities exceeding normal thresholds up to the amounts specified below;
   • Excessive Chargebacks: Additional $10.00 per chargeback when the total exceeds over 3% in chargebacks
   • Excessive Post Closure Chargebacks: Additional $15.00 per chargeback over 100 when the account has been closed
   • Excessive Prepaid Cards: Additional $0.25 per transaction when the total exceeds 1% in prepaid cards
   • Excessive Declines: Additional $0.25 per authorization when the total declines exceeds 40%
   • Excessive Rapid Dispute Resolution (RDR): Additional $10.00 per RDR when the total account exceeds over 3%
4. Chargeback Management Enrollment: We reserve the right to enroll you in chargeback management programs via Verifi & Ethoca at default pricing of $30.00 per Alert or lower to assist with minimizing disputes and consumer complaints.

37. Term and Termination

1. This Addendum shall become effective on the day we begin providing the Services to you and shall end when terminated as set forth herein. For the avoidance of doubt, except as set forth below, termination of this Addendum will not terminate the Agreement. This Addendum may be terminated at any time by either party upon thirty (30) days’ written notice to the other party. Notwithstanding the foregoing sentence, upon as much advance notice as is commercially practicable, we may suspend the Services or terminate this Addendum if: (i) we determine that you are using Services for any fraudulent, illegal, or unauthorized purpose; (ii) you violate the terms of this Addendum or an Event of Default occurs under the Agreement; (iii) we terminate our agreement with any third parties that are involved in providing the Services; or (iv) Processor otherwise decides to discontinue providing the Services. You acknowledge and agree that an occurrence of (i) or (ii) above may be deemed an Event of Default under the Agreement, thereby affording Processor and Bank all rights and remedies as set forth in the Agreement triggered by such an Event of Default, which may include immediate termination of the Agreement (and this Addendum) without notice. This Addendum will terminate automatically upon the termination of the Agreement.

38. Notices

1. 38. Notices We may provide notices and other information regarding the Services to you via the method(s) described in the Agreement or in the E-Sign Consent Agreement set forth below.

39. Amendment

1. We have the right to change or add to the terms of this Addendum at any time, and to change, delete, discontinue, or impose conditions on any feature or aspect of the Services with notice provided to you as set forth in the Notices section of this Addendum. Any use of the Services after our publication of any such changes shall constitute your acceptance of this Addendum as modified.

40. Third Party Beneficiaries

1. Processor’s affiliates and any Persons Processor uses in providing the Clover Service are intended third party beneficiaries of this Addendum, and each of them may enforce its provisions as if it was a party hereto. Except as expressly provided in this Addendum, nothing in this Addendum is intended to confer upon any Persons any rights or remedies, and the parties do not intend for any Persons to be third-party beneficiaries of this Addendum.

41. Ratification

1. The terms of this Addendum shall serve to supplement the terms of your Agreement. Nothing contained herein alters any existing contractual obligations. Except as expressly set forth herein, the Agreement is hereby ratified in all respects and shall remain in full force and effect.

Consent Agreement

1. Consent
   1. Processor can provide disclosures required by law and other information about your legal rights and duties to you.
   2. Where required or requested, your electronic signature (via “click-through” or other method) on agreements and documents relating to the Services has the same effect as if you signed them in ink.
   3. Processor, its affiliates and its third-party subcontractors and/or agents, can send all communications, billing statements, amendments to this Addendum, notices, and other disclosures or information regarding the Services or your use of the Service or the Services as defined herein and in the Agreement (collectively defined as “Disclosures”) to you electronically: (1) via e-mail; (2) by access to a website that we designate in a notice we send to you at the time the information is available; (3) via SMS and text messages; or (4) to the extent permissible by law, by access to a website that we will generally designate in advance for such purpose.
   4. If you want a paper copy, you can print a copy of the Disclosure or download the information for your records.
   5. You agree that Processor, its affiliates and its third-party subcontractors and/or agents, may contact you via telephone, live or artificial, even if the number you provided is a cellular or wireless number or if you have previously registered on a Do Not Call list or requested not to be contacted for solicitation purposes.
   6. This consent applies to all future Disclosures sent to you in connection with this Addendum, the Agreement, or your use of the Clover Service or the other Services as defined herein and in the Agreement.
2. Legal Effect:
   1. By consenting, you agree that electronic Disclosures have the same meaning and effect as if Processor provided paper Disclosures to you. When Processor sends you an email or other electronic notification alerting you that the Disclosure is available electronically and makes it available online, that shall have the same meaning and effect as if Processor provided a paper Disclosure to you, whether or not you choose to view or print or download the Disclosure.

42. Investment of Funds

To the extent of Law, the applicable Services Terms permit: (a) We may invest the funds that we hold in pooled accounts into liquid investments; (b) We own the earnings from these investments; and (c) you irrevocably assign to us all rights you have (if any) to earnings from these investments.