EXHIBIT 6.4
AGREEMENT dated this 18 day of Aug 1998
BY AND BETWEEN: MPACT IMMEDIA TRANSACTION SERVICES LTD., a legal person
having a place of business at Xxxxxxxxx Xxxxx, Xxxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxx, herein represented by Xx. Xxxx
Xxxxxxx, duly authorised as he so declares,
(hereinafter referred to as "MPACT")
AND: Intercapital Global Fund, Ltd., a legal person having a
place of business at One High Street, PO Box 1302, St. Xxxx,
Antigua, West Indies, herein represented by Xx. Xxxxx
Xxxxxxxx, duly authorised as he so declares,
(hereinafter referred to as the "Client")
SECTION I - PREAMBLE
1.1 WHEREAS the Client is desirous of engaging the services of MPACT to
process, verify, settle, confirm, report and perform value added services
on certain transactions relating to the business operations of Client (the
"Processing Services");
1.2 WHEREAS MPACT is desirous of providing the Processing Services to the
Client subject to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
SECTION II - PROCESSING SERVICES
2.1 Subject to the terms and conditions set forth in this Agreement, MPACT
hereby agrees to provide the Processing Services to the Client.
Specifically, the Processing Services shall include the following:
2.1.1 real-time online authentication and approval of the credit card
information (namely, the card number and expiration date) for
each credit card transaction processed by the Processing Services
(the "Credit Card Transactions");
2.1.2 real-time online confirmation and approval that the relevant card
number accounts have sufficient credit available to cover the
amounts of the Credit Card Transactions;
2.1.3 settlements of the Credit Card Transactions that have been
approved based on positive credit card information, positive
credit availability and positive
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electronic mail verification to the extent that same are used;
2.1.4 the use of MPACT's electronic mail verification system and
of an address verification system for the purposes hereof and
the issuance of approvals based upon the electronic mail
response;
2.1.5 crediting back customers' cards upon electronic instructions
from the Client;
2.1.6 monthly written confirmations (on a calendar basis) to the
Client regarding the status of the Credit Card Transactions
including the total credit card deposits, returns, Charge-
Backs pending and Charge-Backs processed; and
2.1.7 daily reporting with respect to deposits and returns for the
preceding twenty-four (24) hours.
2.2 Nothing herein grants the Client any rights whatsoever in any of
MPACT's transaction or other software, and any use thereof by the
Client beyond the requirements of the Processing Services shall be
subject to separate agreement.
2.3 Each Tuesday of each calendar week, MPACT shall remit to the Client
the amount collected by MPACT in respect of Credit Card Transactions
processed, net of the credits identified in subsection 2.1.5 above
(the "Remittances"), subject to the deductions, and reserves set forth
in section III below.
SECTION III - FEES AND RESERVES
3.1 In consideration for Processing Services, the Client agrees to pay to
MPACT the following non-refundable fees:
3.1.1 seven percent (7.00%) of all approved and settled Credit Card
Transactions, subject to a minimum monthly fee of two thousand
dollars ($2,000);
3.1.2 Client shall pay an initial setup fee in the amount of two
thousand five hundred dollars ($2,500.00) upon execution of
this agreement;
3.1.3 Client shall reimburse MPACT for all approved and settled
Credit Card Transactions which are at any time refused, debited
or charged back by the relevant bank or credit card company for
any reason whatsoever ("Charge-Backs");
3.1.4 Client shall pay a fee in the amount of ten dollars ($10.00)
plus any incremental fees and expenses charged or debted by the
banks or credit card companies for each Charge-Back; and
3.2 Client hereby authorizes MPACT to deduct from the Remittances the amounts
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owing under subsection 3.1 above. In the event that the Remittances are
insufficient to pay the amounts owing by the Client to MPACT, the Client
shall pay the balance thereof within seven (7) business days following
receipt of MPACT's written invoice for such amount.
3.3 Client hereby further authorizes MPACT to deduct from the Remittances and
establish a reserve account (the "Reserve Account") to ensure MPACT's
recovery of any liabilities owed it or reasonably anticipated to be owed to
it by the Client pursuant to this Agreement including, without limitation,
all liabilities, in respect of actual and/or potential post-termination
Charge-Backs, post-termination fees, and charges, indemnifications and
expenses due or anticipated to be due to MPACT from Client. The Reserve
Account shall be funded and/or replenished by MPACT's withholding from the
Remittances. The amount of the Reserve Account shall be maintained in
amounts consistent with the provisions set forth in subsection 3.6 below.
3.4 As additional security for the payment of the obligations by the Client,
the Client agrees to provide MPACT with a security deposit (the "Security
Deposit") in the amount of twenty-five thousand dollars ($25,000.00). The
Security Deposit shall be maintained at this amount throughout the term of
this Agreement and for a period of seven (7) months thereafter, and the
Client agrees to pay any deficiency into the Security Deposit upon notice
of such deficiency from MPACT. The Security Deposit shall be made by the
Client to MPACT upon the execution of this Agreement.
3.5 As continuing and collateral security for the due and punctual payment of
any and all amounts now owing or which may hereafter become owing to MPACT
by the Client under this Agreement (the "Obligations"), as same may be
amended, renewed, extended or supplemented, the Client hereby charges and
hypothecates in favour of MPACT, with effect as of and from this date, all
right, title and interest of the Client in and to the Remittances, Security
Deposit and Reserve Account and all funds therein comprised. The Client
undertakes not to grant to any other person any hypothecary or other
security interest of equal or superior rank to MPACT's in the Remittance,
Security Deposit or Reserve Account. The Client further undertakes, upon
notice by MPACT and at its expense, to execute and register such documents
as may be necessary or desirable to perfect MPACT's first-ranking security
interest therein.
3.6 During the initial six (6) month period of the term of this Agreement,
MPACT shall deduct fifteen percent (15%) from the Remittances to fund the
Reserve Account. Thereafter, MPACT shall continue to retain within the
Reserve Account the aggregate amount of fifteen percent (15%) of the
Remittances for the six (6) most recent months of the term of this
Agreement. All interest which may accrue with respect to the Reserve
Account shall be for the sole account of Client and shall be paid twice per
year.
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3.7 MPACT shall have the right to withdraw from the Reserve Account any and
all amounts owned to it hereunder upon one day's notice. MPACT shall
have the additional right to withdraw from the Security Deposit any and
all amounts owed to it hereunder should the Client fail to pay such
amounts within five business days of written default of payment notice to
the Client. MPACT's rights to sums owed to it by Client pursuant to this
Agreement shall in no way be limited by the balance or existence of the
Reserve Account or the Security Deposit. MPACT's rights with respect to
the Reserve Account and the Security Deposit shall survive the
termination of this Agreement.
3.8 All interest which may accrue in respect of the Security Deposit and the
Reserve Accounts shall be for the sole account of MPACT. Notwithstanding
the forgoing, in the event that MPACT terminates this Agreement without
cause pursuant to subsection 5.2 below, MPACT agrees that, as and from
the date of such termination, all interest which may accrue in respect of
Security Deposit and Reserve Account shall be for the account of and be
paid or credited to the Client.
3.9 As amounts become payable to either party under this Agreement and unless
otherwise agreed in writing, the party making the payment shall do so by
facilitating a wire transfer to a pre-designated account stipulated by
the other party. Payments shall be deemed to be made upon the date of
transfer from the transferor's bank.
3.10 The Client shall be responsible for the payment of any and all
applicable sales or other taxes due upon the Credit Card Transactions.
SECTION IV - INDEMNIFICATION AND LIMITATION OF LIABILITY
4.1 The Client shall jointly and severally defend and held harmless MPACT
against and in respect to any and all claims, demands, losses, costs,
expenses, obligations, liabilities, damages, recoveries, and
deficiencies, including interest, penalties and reasonable attorney fees
that MPACT shall incur or suffer, that arise, result from, or relate to
any breach of or failure by the Client to perform any of its
representations, warranties, covenants or agreements in this Agreement or
in any schedule, supplemental agreement, appendix or other instrument
furnished or to be furnished to Client under this Agreement.
4.2 MPACT's liability to Client with respect to any Credit Card Transaction
shall not exceed the amount represented by the transaction record in
connection with such Credit Card Transaction, less the applicable fees
payable to MPACT hereunder.
4.3 ALL WARRANTIES EXPRESSED OR IMPLIED INCLUDING, BUT NOT LIMITED TO,
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR
PURPOSE OF THE PROCESSING SERVICES OR OF ANY OTHER SERVICES PROVIDED BY
MPACT HEREUNDER ARE HEREBY DISCLAIMED BY MPACT, ITS AFFILIATES, AGENTS
AND LICENSORS. IN ADDITION, MPACT, ITS AFFILIATES, AGENTS AND LICENSORS
SHALL NOT BE LIABLE
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FOR ANY INCIDENTAL, CONSEQUENTIAL, OR OTHER DAMAGES, LOSSES OR CLAIMS IN
ANY WAY CONNECTED WITH OR ARISING OUT OF THE USE OF THE PROCESSING SERVICES
OR ANY OTHER SERVICES PROVIDED BY MPACT HEREUNDER.
4.4 MPACT, its affiliates, agents or licensors shall not be liable for any loss
resulting from erroneous statements or errors in transmission, nor for any
loss resulting from any delay, interruption or failure to perform hereunder
due to any circumstances beyond MPACT's reasonable control including,
without limitation, acts of god, fire, explosion, earthquake, riot, war,
sabotage, accident, embargo, storms, strikes, lockouts, any interruption,
failure or defects in Internet, telephone, or other interconnect services
or in electronic or mechanical equipment MPACT's obligations hereunder
shall be suspended during any of the foregoing circumstances, which
suspension shall not be a cause for termination of this agreement by the
Client
SECTION V - TERM AND TERMINATION
5.1 This Agreement shall be effective commencing on the date first mentioned
above (the "Effective Date") until the first anniversary of the Effective
Date, and thereafter shall be renewed automatically for additional
consecutive three (3) month periods, unless earlier terminated in
accordance with the terms of subsections 5.2, 5.3 or 5.4 hereof.
5.2 Notwithstanding subsection 5.1, MPACT shall have the right to terminate
this Agreement immediately: (i) in the event of breach by the Client of its
representation, warranties or obligations under this Agreement or (ii) in
the event that the Client is delinquent in any payment hereunder ten (10)
days after the same has become due, MPACT may also terminate this Agreement
with or without cause upon twenty (20) business days' written notice to
Client.
5.3 Notwithstanding subsection 5.1, Client may terminate this Agreement with
or without cause, upon fifteen (15) business days written notice to MPACT.
Client's use of MPACT's services hereunder are completely at will and non-
exclusive.
5.4 Notwithstanding subsection 5.1, the parties agree that either of them may,
by notice to the other party, initiate negotiations on amendments to this
Agreement where such amendments would take effect on as of the six (6)
month anniversary of the Effective Date. In the event that notice to
negotiate has been given by a party hereunder, but the parties have failed
to reach agreement on amendments by such six (6) month anniversary, this
Agreement shall terminate on such six (6) month anniversary.
5.5 Upon any termination of this Agreement, the Client shall immediately
discontinue the use of all of the Processing Services. All provisions
regarding indemnification, warranty, liability and limits thereon, and
confidentiality and/or protection of proprietary rights and trade secrets
shall survive indefinitely or until the expiration
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of any time period specified elsewhere in this Agreement with respect to
the provision in question, and termination of this Agreement shall not
relieve the Client of its obligations to pay accrued fees.
5.6 Upon any termination of this Agreement, MPACT shall be entitled to retain
as security for the payment of the Obligations each of the Security Deposit
and the Reserve Account for a period of seven (7) months thereafter.
SECTION VI - REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE CLIENT
6.1 The Client hereby agrees to abide by the following good business practices:
6.1.1 to offer for sale through its Web Site only products and services
that are available for delivery in the normal course of the
Client's business, based upon the type of product or service
being offered; and
6.1.2 to offer products or services for sale only if the Client has
legitimate rights to market and sell such products or services.
6.2 The Client hereby represents and warrants to MPACT that throughout the term
of this Agreement:
6.2.1 it will maintain the value and reputation of MPACT to the best of
its reasonable ability;
6.2.2 it will conduct its business affairs in an ethical manner and in
accordance with the terms and intent of this Agreement, and in
compliance with all applicable government regulations;
6.2.3 it shall not use the Processing Services in connection with any
illegal or fraudulent business activities; and
6.2.4 it shall not permit or authorize any other person to use the
Processing Services.
6.3 The Client acknowledges to MPACT that they are independent contractors and
that nothing herein shall be construed as creating a joint venture or
partnership between them. For greater certainty, the Client acknowledges
that MPACT is not involved in the Client's business.
6.4 The Client agree that, at any time and from time to time during the term of
this Agreement, MPACT shall have the right to post a banner of its design
on the application/deposit page of website(s)incorporating Processing
Services, without any charge whatsoever to MPACT and in addition to any
other rights it may have hereunder.
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SECTION VII - GUARANTORS
7.1 As a primary inducement to MPACT to enter into this Agreement, the
undersigned (the "Guarantors"), being all the registered and beneficial
shareholders of the Client, by signing this Agreement, jointly and
severally, unconditionally and irrevocably, guarantee the continuing full
and faithful performance and payment by Client of each of its duties and
obligations to MPACT pursuant to this Agreement, whether before or after
termination or expiration and whether or not any of the Guarantors has
received notice of any amendment. If Client breaches this Agreement MPACT
may proceed directly against any or all of the Guarantors or any other
persons or entity responsible for the performance of this Agreement,
without first exhausting its remedies against any other person or entity
responsible therefor to it, or any security held by MPACT.
SECTION VIII - AMENDMENTS
8.1 MPACT may amend this Agreement at any time by mailing written notice to
Client of any amendment at least thirty (30) days prior to the effective
date of the amendment, which amendment shall not (without Client's written
consent) modify or retroactively affect or apply to fees, reserves or
transactions occurring prior to the effective date of the amendment. The
amendment shall become effective on the date specified by MPACT unless
MPACT receives Client's notice of termination of this Agreement before such
effective date.
SECTION IX - NOTICES
9.1 Any notice, demand, request or other communication required or permitted to
be given under this Agreement shall be faxed (to MPACT at _______________
and to Client at 514-878-6335) delivered personally, or sent to the other
party by prepaid registered mail, return receipt requested, at the
addresses first hereinabove set out or to such other address as either
party may have previously indicated to the other in writing in accordance
with the foregoing. Any such notice, request, demand or communication
shall be deemed to have been received on the day it was delivered
personally, on the fifth (5th) day following mailing, unless there is a
disruption of any kind of postal service in Canada, in which event all
deliveries shall be made personally or by fax, or on the business day after
the date of a faxed notice.
SECTION X - MISCELLANEOUS
10.1 This Agreement together with supplemental agreements, appendixes and
schedules constitutes the entire agreement between the parties pertaining
to the subject matter contained in it and supersedes all prior and
contemporaneous agreements, representations and understandings of the
parties. No waiver of any of the provisions in this Agreement shall be
deemed or shall constitute, a waiver of any other provision, whether or
not similar, nor shall any waiver constitute a continuing waiver. No waiver
shall be binding unless executed in writing by the
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Party making the waiver.
10.2 The Client may not assign this Agreement, or any rights hereunder,
directly or by operation of law, without the prior written consent of
MPACT which consent may be withheld for any reason in MPACT's sole
discretion. For purposes of this Agreement assignment shall include,
but not be limited to, transfer of control of the Client and any
ownership change which results in a new majority owner.
10.3 The Client shall be liable for and shall indemnify and reimburse MPACT
for any and all attorneys' fees and other costs and expenses paid or
incurred by MPACT in the enforcement of this Agreement, or in
collecting any amounts due from the Client hereunder, or resulting
from any breach of any of the terms or conditions of this Agreement.
10.4 All remedies of either party hereunder are cumulative and may be
exercised concurrently or separately. The exercise of any one remedy
shall not be deemed to be an election of such remedy and shall not
preclude the exercise of any other remedy. No failure on the part of
either party to exercise and no delay in exercising any right or
remedy hereunder shall operate as a waiver of such right or remedy.
10.5 If any provision of this Agreement is held invalid or unenforceable by
any court of final jurisdiction, it is the intent of the parties that
all other provisions of this Agreement be construed to remain fully
valid, enforceable and binding on the parties.
10.6 The subject headings of the paragraphs and subparagraphs of this
Agreement are included for convenience only and shall not affect the
construction or interpretation of any of its provisions.
10.7 Reference to "this Agreement" include any supplementary agreements,
addendum, appendixes and amendments and any other agreements,
schedules appendixes and amendments promulgated by MPACT and furnished
to the Client from time to time.
10.8 All dollar amounts referred to in this Agreement are in United States
funds.
IN WITNESS WHEREOF, the parties have signed as of the date first hereinabove
mentioned.
MPACT IMMEDIA TRANSACTION SERVICES LTD.
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per: /s/ Xx. Xxxx Xxxxxxx per: /s/ Xx. Xxxxx Xxxxxxxx
-------------------------- -----------------------------
Xx. Xxxx Xxxxxxx Xx. Xxxxx Xxxxxxxx
Guarantors:
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per: /s/ Xx. Xxxxx Xxxxxxxx
--------------------------
Xx. Xxxxx Xxxxxxxx
