EXHIBIT 10.3
XXXXX
FARGO
MASTER AGREEMENT FOR TREASURY MANAGEMENT SERVICES
The Service Documentation described below contains the terms under which Xxxxx
Fargo provides treasury management services ("Services"). Xxxxx Fargo Bank, N.
A. ("Bank") and the Company to which the Services will be provided are
identified in the Acceptance of Services ("Acceptance").
Bank and Company agree:
1. SERVICE DOCUMENTATION. The Service Documentation includes:
1.1 The Service Description for each Service.
1.2 The Acceptance.
1.3 This Master Agreement for Treasury Management Services
("Master Agreement").
1.4 The account agreement for the business or commercial deposit
account(s) (each, an "Account") that Company or Company's
affiliate or subsidiary maintains at Bank or Bank's affiliate
in connection with a Service. The account agreement includes
the Dispute Resolution Program that Company and Bank agree to
use to resolve any disagreements between Company and Bank
regarding accounts and Services governed by the Service
Documentation.
1.5 User Guides which include software, software licenses, reset
diskettes, price schedules, specifications, instructions, and
notices.
1.6 The set-up form(s) for each Service.
The Service Documentation also applies to any Service that is provided
by an affiliate of Bank and any Service that is used by an affiliate or
a subsidiary of Company. "Bank" includes each such affiliate, and
"Company" includes each such affiliate and subsidiary. All terms
defined in this Master Agreement shall have the same meaning when used
in the Service Documentation. If there is a conflict among the
documents that make up the Service Documentation, the documents will
govern in the order set forth above. Company acknowledges receiving a
copy of the Service Documentation for each Service it requested when it
entered into this Master Agreement.
2. SERVICES. Bank and Company will agree upon the Service(s) to be
provided.
3. CHANGES TO SERVICES. Bank may change (or add to) the terms and fees in
the Service Documentation at any time upon prior written notification.
If Company discontinues using the affected Service before the change
becomes effective, it will not be bound by the change. If Company
continues to use a Service after the change becomes effective, it will
be bound by the change.
4. TERM AND TERMINATION. Unless terminated sooner in accordance with the
Service Documentation, this Master Agreement and all Services will
continue in effect until terminated by either party upon thirty (30)
days prior written notice to the other party (unless a Service is
terminated sooner in accordance with the Service Documentation). Bank
may terminate any Service following notice to Company of a breach of
any provision of the Service Documentation and Company's failure to
cure the breach within fifteen (15) days of the date of such notice.
Bank may also terminate any Service without notice to Company if
Company is subject to a petition under the U. S. Bankruptcy Code or if
Bank determines, in its sole discretion, that a material adverse change
has occurred in Company's ability to perform its obligations under the
Service Documentation. The termination of a Service will not affect
Company's or Bank's rights with respect to transactions which occurred
before termination. Bank shall not be liable to Company for any losses
or damages Company may incur as a result of any termination of any
Service.
5. SERVICE FEES. Company shall pay Bank the fees described in the Service
Documentation and any taxes applicable to each Service, however
designated, exclusive of taxes based on Bank's net income. Bank may
debit Company's account(s) with Bank for any fees not covered by
earnings credits and any taxes that are due, or it may send an invoice
to Company for such amounts, which Company shall promptly pay. Bank may
assess finance charges at a rate of 1.5% per month (18% per annum) or
the highest rate permitted by law, whichever is less, on any invoiced
fees or taxes that are not paid within thirty (30) days of the due date
and shall apply payments and other reductions of amounts owed first to
unpaid interest and then to other fees and charges.
MASTER AGREEMENT TM-1450 REVISED 3/1/04 PAGE 1 OF 3
6. CONFIDENTIAL INFORMATION. Unless otherwise provided in the Service
Documentation, all User Guides and computer programs provided pursuant
to this Master Agreement constitute Bank's or its vendor's confidential
information ("Confidential Information"). Bank or its vendor will
remain the sole owner of all such Confidential Information, and Company
will not acquire any interest in or rights to it as a result of
Company's use of any Service except as set forth in the Service
Documentation. Company will maintain the confidentiality of the
Confidential Information and will not disclose (or permit its employees
or agents to disclose), copy, transfer, sublicense or otherwise make
any of it available to any person or entity, other than its employees
who have a need to use the Confidential Information in connection with
the applicable Service. Company shall notify Bank immediately if it
knows or suspects that there has been any unauthorized disclosure,
possession, use or knowledge (each, an "Unauthorized Use") of any
Confidential Information, and if it is responsible for the Unauthorized
Use, it will, at its expense, promptly take all actions, including
without limitation initiating court proceedings to recover possession
or prevent further Unauthorized Use of the Confidential Information and
obtain redress for any injury caused to Bank as a result of such
Unauthorized Use. In addition, except as permitted by applicable law,
Company may not decompile, reverse engineer, disassemble, modify, or
create derivative works of any computer program provided pursuant to
this Master Agreement.
7. THIRD PARTY NETWORKS; USE OF REQUIRED SOFTWARE. If Bank determines that
any funds transfer or communications network, Internet service
provider, or other system(s) it has selected to provide a Service is
unavailable, inaccessible or otherwise unsuitable for use by Bank or
Company, Bank may, upon notice to Company, suspend or discontinue the
affected Service. Company shall use and maintain in good working order
(and at its own expense) software, hardware and other equipment
necessary for Company to use the Service(s) in accordance with the
Service Documentation.
8. NO REPRESENTATIONS OR WARRANTIES OF BANK OR SOFTWARE VENDOR. Neither
Bank nor any software vendor makes any express or implied
representations or warranties with respect to the Services or any
software used in connection with the Services including without
limitation any warranty as to the merchantability or fitness for a
particular purpose, other than those expressly set forth in the Service
Documentation.
9. LIABILITY AND INDEMNIFICATION.
9.1 Bank will perform each Service in accordance with reasonable
commercial standards applicable to Bank's business; laws,
regulations and operating circulars governing the activities
of Bank; applicable funds transfer system(s) and clearinghouse
rules; and the Service Documentation.
9.2 Bank is under no obligation to honor, in whole or in part, any
entry, file, batch release, payment order, transaction or
instruction (each, an "Order"), which a) exceeds Company's
available funds on deposit in an Account with Bank related to
the Order, unless otherwise provided in the Service
Documentation; b) is not in accordance with the Service
Documentation or Bank's applicable policies, procedures or
practices as Bank may from time to time establish and make
available to Company; c) Bank has reason to believe may not
been duly authorized, should not be honored for its or
Company's protection, or involves funds subject to a hold,
dispute, restriction or legal process that prevents their
withdrawal; or d) would possibly result in Bank violating any
applicable rule or regulation of any federal or state
regulatory authority including without limitation any Federal
Reserve risk control program or guidelines such as the
limitations on Bank's intra-day net funds position.
9.3 Company shall promptly furnish written proof of loss to Bank
and notify Bank if it becomes aware of any third party claim
related to a Service. Company shall cooperate fully (and at
its own expense) with Bank in recovering a loss. If Company is
reimbursed by or on behalf of Bank, Bank or its designee will
be subrogated to all rights of Company.
9.4 Any claim, action or proceeding against Bank for losses or
damages arising from a Service, including Bank's honoring or
dishonoring a check covered by a Service, must be brought
within one (1) year from the date of the act or omission or in
the case of a check from the date the check was first paid or
returned by Bank.
9.5 Bank will have no liability for failure to perform or delay in
performing a Service if the failure or delay is due to
circumstances beyond Bank's reasonable control.
9.6 Except in the case of Bank's gross negligence or intentional
misconduct, Company shall indemnify and hold Bank, its
directors, officers, employees and agents harmless from all
losses or damages that arise out of a) the performance of a
Service in accordance with the Service Documentation including
without limitation any warranty Bank is required to make to a
third party in connection with a Service; b) an act or
omission of any agent, courier or authorized representative of
Company; and c) if the Service includes a license or
sublicense of any software to Company, the use or distribution
of the software by Company or any person gaining access to the
software through Company that is inconsistent with the license
or sublicense.
MASTER AGREEMENT TM-1450 REVISED 3/1/04 PAGE 2 OF 3
9.7 Bank will only be liable to Company for its direct monetary
losses or damages due to Bank's negligence or breach of this
Master Agreement. Except in the case of Bank's gross
negligence or intentional misconduct, Bank's liability to
Company will be limited to an amount not to exceed ten (10)
times Bank fees incurred during the calendar month immediately
preceding the calendar month in which such loss or damages
were incurred (or, if no Bank fees were incurred in such
month, Bank fees incurred in the month in which the losses or
damages were incurred). In no event will either party to this
Master Agreement be liable to the other party for any special,
consequential, incidental (including without limitation court
costs and attorneys' fees), indirect, or punitive losses or
damages, whether any claim is based on contract or tort, or
whether the likelihood of such losses or damages was known to
the other party and regardless of the form of the claim or
action.
10. GENERAL.
10.1 The Service Documentation will be governed by substantive
federal laws, regulations and rules and, to the extent such
laws, regulations and rules are not applicable, those of the
state in which the principal office of the Bank identified on
the Acceptance is located, without regard to conflicts of laws
principles. Any portion of the Service Documentation which is
inconsistent with applicable laws, regulations or rules will
be deemed modified and applied in a manner consistent
therewith, and Bank will incur no liability to Company as a
result of the inconsistency or modification and application.
If any portion of the Service Documentation is deemed
unenforceable or invalid, it will not otherwise affect the
enforceability or validity of the Service Documentation.
10.2 The Service Documentation is the entire agreement between Bank
and Company and supersedes all prior representations,
conditions, warranties, understandings, proposals or
agreements regarding a Service. No course of dealing or waiver
of any right on one occasion will constitute a modification of
the Service Documentation or be a waiver of that right on a
subsequent occasion.
10.3 Company agrees to provide Bank promptly upon Bank's request
any existing financial statements or other information
pertaining to Company's financial condition or any previously
unprepared financial statements which Bank may require Company
to prepare and/or to be audited or reviewed by independent
certified public accountants acceptable to Bank.
10.4 Company expressly warrants that a Service will not be used in
a manner which violates any federal or state law including
without limitation any sanction or control administered by the
Office of Foreign Assets Control or Bureau of Export
Administration.
10.5 Sections 4, 5, 6, 8, 9, 10.4 and 10.5 of this Master Agreement
will survive termination of this Master Agreement.
10.6 Either party may provide notice to the other party by mail,
personal delivery, or electronic transmission. Bank shall use
the most recent address for Company in Bank's records, and any
notice from Bank will be effective when sent. Company shall
use the address where Company's relationship manager or other
manager is located and address any notice to the attention of
such manager. Any notice from Company will be effective when
actually received by Bank. Bank will be entitled to rely on
any notice from Company that it believes in good faith was
authorized by an authorized representative of Company and,
except as expressly stated in the Service Documentation, shall
have no obligation to verify the signature (including an
electronic signature). Each party will have a reasonable time
after receipt of any notice to act on it.
10.7 All uses of the Services through Company's ID codes,
passwords, token cards, PINs, or passcodes (each, a "Code")
will be deemed to be authorized by and binding on Company.
Company's failure to protect Codes may allow an unauthorized
party to a) use the Services, b) access Company's electronic
communications and financial data, and c) send or receive
information and communications to Bank. Unencrypted electronic
transmissions are not secure and Company assumes the entire
risk for unauthorized use of Codes and any unencrypted
electronic transmissions.
10.8 Company may not assign or transfer its rights or obligations
with respect to the Service Documentation without Bank's prior
written consent. Bank may assign its rights and obligations
with respect to the Service Documentation to any successor by
merger, consolidation or corporate reorganization.
10.9 Unless otherwise provided in the Service Documentation, the
term "Banking Day" means that part of a business day occurring
prior to the cutoff time determined in accordance with Bank's
applicable funds availability policy.
Master Agreement TM-1450 revised 3/1/04 Page 3 of 3
XXXXX
FARGO
ACCEPTANCE OF SERVICES
PART I - CERTIFICATION
BANK: XXXXX FARGO BANK, N.A. [ ] Yes [X] NO NEW AGREEMENT
[X] YES [ ] No ADDITIONAL SERVICE
Each person singing this Acceptance of Services, ("Acceptance") certifies that:
(a) the undersigned Company has received and agrees to be bound by the Service
Documentation, as defined in Bank's Master Agreement for Treasury
Management Services ("Agreement"), and, if checked below, Bank's Security
Procedures, Sweep Services and Credit Sweep Services;
(b) he or she has full authority to execute this Acceptance on behalf of
Company, to enter into other agreements with Bank for Services now or
hereafter offered by Bank and to amend, terminate or otherwise act on
behalf of Company with respect to such agreements and Services; and
(c) Company's use of any Service confirms its agreement to be bound by the
Service Documentation relating to that Service.
All terms defined in the Agreement shall have the same meaning when used in this
Acceptance.
Company's elections with respect to Security Procedures, Sweep Services, and
Credit Sweep Services are:
[*] Yes [*] No Security Procedures-ACH
[*] Yes [*] No Security Procedures- Wire Transfers
[*] Yes [*] No Sweep Services
[*] Yes [*] No Credit Sweep Services.
PART II - SECURITY PROCEDURES
A. IMPORTANT INFORMATION ABOUT SECURITY PROCEDURES.
Company understands that when Bank acts on any instruction to transfer funds by
ACH or wire transfer from accounts Company maintains at Bank (each, an "Order"),
Bank and any beneficiary's bank may rely solely on (i) the beneficiary's account
number even if it identifies a person different from the named beneficiary, and
(ii) if provided to Bank, the identification number of any other financial
institution through or to which the funds are to be transferred, rather than the
name of the financial institution. Company expressly agrees to be bound by any
Order, whether or not authorized, issued in its name and accepted by Bank in
compliance with the security procedure(s) Company has selected as indicated
below. If Company selects a security procedure that is set forth in an Addendum,
that Addendum is incorporated in this Acceptance by this reference.
B. SECURITY PROCEDURES FOR ACH SERVICES.
OPTION 1 [*] Yes [*] No BANK'S STANDARD SECURITY PROCEDURES (as set forth
in Bank's ACH Services
Security Procedures Agreement that is incorporated
in this Acceptance by this reference).
IF COMPANY ELECTS BANK'S STANDARD SECURITY PROCEDURES, COMPANY MUST
SELECT ONE OF THE FOLLOWING SECURITY PROCEDURES:
[*] Yes [*] No INTERNET ACH SECURITY PROCEDURE.
[*] Yes [*] No OTHER ACH SERVICES SECURITY procedures
(If yes, select procedure that applies.)
Token Card/Passcode -
[*] File Transmission/Batch Release [*] Password - File Transmission
[*] Secure File Transport. [*] Password - Taped or Written
Instructions.
TM-1444 Acceptance of Services (Revised 5/11/04) Page 1 of 4
OPTION 2 [*] Yes [*] No SPECIAL SECURITY PROCEDURES. Company has refused
the security procedures set forth in Option 1 above.
Instead Company has requested use of the security
procedure(s) set forth in the Addendum.
Individual(s) authorized to receive information regarding the ACH security
procedure selected above:
Name: ________ [*] ______________ Name: ________ [*] ______________
Name: ________ [*] ______________ Name: ________ [*] ______________
C. SECURITY PROCEDURES FOR WIRE TRANSFER SERVICES.
OPTION 1 [*] Yes [*] No BANK'S STANDARD SECURITY PROCEDURES (as set forth
in Bank's Wire Transfer Services Security
Procedures Agreement that is incorporated in
this Acceptance by this reference).
IN ADDITION TO BANK'S STANDARD SECURITY PROCEDURES, COMPANY
HAS SELECTED THE FOLLOWING SECURITY PROCEDURES:
[*] Yes [*] No SECURITY PROCEDURE FOR TELEPHONE
VERIFICATION (voice-initiated Orders only).
Voice-initiated, non-repetitive Orders
exceeding $_________ will be subject to
telephone verification. (If no amount is
designated, $500,000 will be used.)
[*] Yes [*] No SECURITY PROCEDURE FOR COMMERCIAL ELECTRONIC
OFFICE(R) ("CEO(R)") WIRE TRANSFER SERVICE
(OR WELLSNET(R) WIRE TRANSFER SERVICE.)
[*] Yes [*] No SECURITY PROCEDURES FOR ELECTRONIC
COMMERCE/PAYMENT MANAGER SERVICES (If yes,
select procedure that applies.)
[*] Password - File Transmission
(Non-encrypted). (This procedure
requires that a unique eight-digit code
separately agreed upon in writing by
Company and Bank be presented with
Company's wire file. Company may be
required to change the code on a regular
basis.)
[*] Secure File Transport (Encrypted).
(This procedure uses 128-bit Secure
Sockets Layer encryption and requires
the use of a transmission ID and a
transmission password. Use of a digital
certificate is optional.)
OPTION 2 [*] Yes [*] No SPECIAL SECURITY PROCEDURES. Company has
refused the security procedures set forth in
Option 1, above. Instead Company has
requested use of the security procedure(s)
set forth in the Addendum.
INDIVIDUAL(S) AUTHORIZED TO RECEIVE INFORMATION REGARDING THE WIRE TRANSFER
SECURITY PROCEDURE SELECTED ABOVE:
Name: ________ [*] ______________ Name: ________ [*] ______________
Name: ________ [*] ______________ Name: ________ [*] ______________
TM-1444 Acceptance of Services (Revised 5/11/04) Page 2 of 4
PART III - SWEEP SERVICES
A. IMPORTANT DISCLOSURES
GENERAL. The investment instruments below that are offered, sold, or placed by
Bank are not deposits in or obligations of, and are not guaranteed by, Bank or
any affiliate (except for Repurchase Agreements, see below); are not insured by
the FDIC, the Securities Investors Protection Corporation, or the United States
of America; and are subject to investment risk including possible loss of
principal invested or the nonpayment of interest. Yields vary with market
conditions. Past performance is no guarantee of future results. Bank makes no
representation or warranty as to the suitability or safety with respect to any
investments. Bank and its affiliates and their respective employees, officers
and directors, will not be liable to Company for any reason whatsoever related
to investments or redemptions made through the Services..
ELECTRONIC DELIVERY. Confirmations and/or Statements will be sent to Company by
electronic means unless otherwise requested by Company. Electronic means include
the Commercial Electronic Office(R), facsimile or Secure E-Mail.
MUTUAL FUNDS. Xxxxx Fargo Funds Management, LLC, a wholly-owned subsidiary of
Xxxxx Fargo & Company, provides investment advisory and administrative services
for the Xxxxx Fargo Funds(R). Other affiliates of Xxxxx Fargo & Company provide
sub-advisory and other services for the Funds. The Funds are distributed by
Xxxxxxxx, Inc., Member NYSE/SIPC. Xxxxx Fargo & Company and its affiliates are
not affiliated with Xxxxxxxx, Inc. Fees for such services are disclosed in the
prospectuses for these Funds. Bank may act as agent or as principal for Company
for mutual fund transactions..
For more complete information about the Xxxxx Fargo Money Market Funds including
fees and expenses that apply to an investment in them, obtain a current
prospectus by contacting your Treasury Management sales officer, relationship or
other manager or Institutional Brokerage & Sales representative. Please read the
prospectus carefully before investing. Money market mutual funds seek to
preserve the value of your investment at $1.00 per share; it is possible to lose
money by investing in the money market mutual funds.
EURODOLLAR SWEEP. Funds invested in the Eurodollar Sweep account are not
domestic bank deposits, are not insured by the Federal Deposit Insurance
Corporation and are not guaranteed by the United States government or any agency
thereof.
REPURCHASE AGREEMENTS. Repurchase Agreement transactions are obligations of, but
not deposits with, the repurchase counterparty (Bank or affiliates).
GOVERNMENT SPONSORED ENTERPRISES ("GSE"). Bank will act as principal for all GSE
transactions. Discount notes and other short-term obligations issued by GSE's
are obligations of their respective issuers. The obligations of such issuers are
not obligations of, nor are they guaranteed by the United States of America.
B. DESIGNATION OF INVESTMETN INSTRUMENTS
Company designates the following investment instruments (Select only one per
checking account):
[*] Yes [*] No OVERLAND EXPRESS(R) SWEEP. (Xxxxx Fargo Overland
Express Sweep Fund)
[*] Yes [*] No INVESTACCOUNT(R). In addition to this Acceptance
and the Service Description, a Master Repurchase
Agreement must be completed and signed.
[*] Yes [*] No EURODOLLAR SWEEP.
[*] Yes [*] No CORPORATE CASH MANAGEMENT ACCOUNT ("CCMA"). In
addition to this Acceptance and the Service
Description, a Master Repurchase Agreement must be
completed and signed.
[*] Yes [*] No CORRESPONDENT FED FUNDS SOLD. In addition to this
Acceptance and the Service Description, a Federal
Funds Sale Agreement-Principal Only-Sweep
letter must by______ completed and signed.
TM-1444 Acceptance of Services (Revised 5/11/04) Page 3 of 4
o GOVERNMENT SPONSORED ENTERPRISE INVESTMENT OPTION (You must select at
least two)
[*] Federal Farm Credit Bank ("FFCB")
[*] Federal Home Loan Bank ("FHLB")
[*] Federal National Mortgage Association ("Xxxxxx Mae")
o CONCENTRATION ACCOUNT ELECTIONS
The Concentration Account, Interest Account and Specified Balance listed below
are subject to Bank's Corporate Cash Management Account Service Description.
------------------------------------------- -------------------------------- -----------------------------------------
Concentration Account Name Account Number Specified Balance
(if desired)
[*] [*] $ [*]
------------------------------------------- -------------------------------- -----------------------------------------
Interest Account Name Account Number
((May be the Concentration Account)
[*] [*]
------------------------------------------- -------------------------------- -----------------------------------------
AGREED TO AND ACCEPTED BY:
COMPANY: 3PEA TECHNOLOGIES, INC.
BY: SIGNED
---------------------------------
NAME: XXXX X. XXXXXXXX
TITLE: CHIEF EXECUTIVE OFFICER
DATE: NOVEMBER 4, 2004
[*] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY
BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED
TM-1444 Acceptance of Services (Revised 5/11/04) Page 4 of 4
XXXXX
FARGO
ACH SERVICES SECURITY PROCEDURE AGREEMENT
Bank and Company have entered into a Master Agreement for Treasury Management
Services (the "Agreement") which governs the ACH services to be provided by
Bank.
Bank and Company agree:
1. SECURITY PROCEDURE SELECTION. The Token Card/Passcode - File
Transmission/Batch Release security procedure described below is required
for the product known as the Internet ACH Service. If Company uses the
Internet to access ACH services, but does not use the Internet ACH Service,
the Secure File Transport security procedure is required. For each of the
other ACH services, Company acknowledges that Bank offers each of the
security procedures described below for the purpose of verifying the
authenticity of an instruction to originate an ACH credit or debit entry (a
"payment order") received by Bank in the name of Company. Company refuses
to have its payment orders verified by any security procedure other than
the security procedure it has expressly designated. Company has reviewed
various security procedures including the following and has determined that
the security procedure designated in the Acceptance of Services best meets
its requirements, given the size, type and frequency of the payment orders
it will issue to Bank:
TOKEN CARD/PASSCODE - File Transmission/Batch Release (for Internet ACH
Service) - This procedure combines a token card with a personal
identification number (PIN). A token card will be assigned to each Operator
(as defined below). The PIN is set by each Operator individually upon first
logon. The token card generates a random and unique security code every
minute. The code combines with the PIN to provide a unique password every
minute. The password must be presented with the ACH transmission or batch
release authorization and is used by Bank to authenticate the identity of
Company and/or the person originating the transmission or release. Bank
will verify each request to access the Service by determining if the
Passcode is valid for the associated Operator ID and if the Operator ID
used by the person requesting access is the Operator ID of one of the
persons Company has designated as being authorized such access. Bank has no
obligation to confirm in any other way the identity of any person making
such a request.
IF COMPANY HAS REQUESTED SELF-ADMINISTRATION OF COMPANY'S ACCESS TO THE
CEO, Bank will assign a Company ID code and will set up Company's first
Company administrator ("FCA") by assigning a personal ID code and password
to be used when the FCA first enters the CEO. The FCA can then set up
additional Company administrators (who will have access to all services
Company receive through the CEO), administrators and users. A User is an
Operator. (Administrators and Users will have access only to the specific
service(s) they are set up to access.) Any Company administrator: (a) can
set up additional Company administrators, administrators and users, issuing
them a password that will be changed upon first entry to the CEO and a
personal ID code; (b) can reset passwords for all services; and (c) shall
be required to immediately disable access to the CEO for any Company
administrator, administrator or user who ceases to be a Company
administrator, administrator or user. Administrators can set up additional
administrators and users and reset passwords for the specific service(s)
they are set up to access. Bank will not know the password of any Company
administrator, administrator, or user except the initial password assigned
to the FCA. Bank will give the Company administrators and the
administrators a token card and a personal identification number ("PIN"),
known only by them and Bank. Self-administration will allow a Company
administrator or an administrator to initiate a request to Bank to reassign
an existing token card to another Company administrator, administrator or
user.
TM-1425 ACH Services Security Procedure Agreement - Revised 6/19/2002
Page 1 of 2
IF COMPANY HAS REQUESTED SELF-ADMINISTRATION WITH DUAL CONTROL, BANK WILL
ASSIGN A COMPANY ID CODE AND WILL SET UP COMPANY'S FIRST TWO COMPANY
ADMINISTRATORS (THE FCAS) BY ASSIGNING EACH A PERSONAL ID CODE AND PASSWORD
TO BE USED WHEN EACH FIRST ENTERS THE CEO. ALL ACTIONS WHICH CAN BE
PERFORMED BY A COMPANY ADMINISTRATOR OR ADMINISTRATOR IN THE PRECEDING
PARAGRAPH WILL REQUIRE THAT ONE COMPANY ADMINISTRATOR OR ADMINISTRATOR WITH
APPROPRIATE FUNCTION ACCESS TO INITIATE THE ACTION AND A SECOND COMPANY
ADMINISTRATOR OR ADMINISTRATOR WITH APPROPRIATE FUNCTION ACCESS TO APPROVE
THE ACTION.
IF COMPANY DOES NOT HAVE SELF-ADMINISTRATION, COMPANY'S SECURITY
ADMINISTRATOR WILL DETERMINE WHICH OF COMPANY'S EMPLOYEES WILL BE
AUTHORIZED TO CREATE/MODIFY AND TO VERIFY ACH TRANSFER REQUESTS (EACH, AN
"OPERATOR") AND THE DOLLAR LIMITS PER TRANSACTION AND PER DAY ASSIGNED TO
EACH OPERATOR AND WILL COMMUNICATE THIS INFORMATION TO BANK. BANK WILL SET
UP THE OPERATORS BY ASSIGNING EACH AN OPERATOR ID. THE SECURITY
ADMINISTRATOR WILL ALSO BE RESPONSIBLE FOR COMMUNICATING ANY CHANGES IN
OPERATORS OR IN OPERATOR LIMITS OR AUTHORIZATION(S) TO BANK AND PROMPTLY
REPORTING ANY LOST OR STOLEN TOKEN CARDS.
SECURE FILE TRANSPORT - THIS PROCEDURE USES 128-BIT SSL ENCRYPTION AND
REQUIRES THE USE OF A TRANSMISSION ID, A TRANSMISSION PASSWORD, AND A
DIGITAL CERTIFICATE.
PASSWORD - FILE TRANSMISSION - THIS PROCEDURE REQUIRES THAT A UNIQUE
EIGHT-DIGIT CODE SEPARATELY AGREED UPON IN WRITING BY COMPANY AND BANK BE
PRESENTED WITH COMPANY'S ACH FILE. COMPANY MAY BE REQUIRED TO CHANGE THE
CODE ON A REGULAR BASIS.
PASSWORD - TAPED OR WRITTEN INSTRUCTIONS - THIS PROCEDURE REQUIRES THAT
COMPANY PRESENT TAPED OR WRITTEN INSTRUCTIONS IN A TAMPER PROOF CONTAINER
ACCOMPANIED BY A UNIQUE CODE SEPARATELY AGREED UPON IN WRITING BY COMPANY
AND BANK.
2. SECURITY PROCEDURE PROTECTION. Company and Bank will preserve the
confidentiality of the security procedure. If Company becomes aware of a
breach, or suspects that a breach may occur, it will immediately notify
Bank in a matter affording Bank a reasonable opportunity to act on the
information.
3. COMPANY BOUND BY PAYMENT ORDERS. Company will be bound by any payment
order, whether or not authorized, issued in its name and accepted by Bank
in compliance with the designated security procedure.
4. INCONSISTENCY OF NAME AND NUMBER. If a payment order describes the receiver
inconsistently by name and account number (i) payment may be made on the
basis of the account number even if it identifies a person different from
the named receiver (ii) Bank may in its sole discretion refuse to accept or
may return the payment order. If a payment order describes a participating
financial institution inconsistently by name and identification number, the
identification number may be relied upon as the proper identification of
the financial institution. If a payment order identifies a non-existent or
unidentifiable person or account as the receiver or the receiver's account,
Bank may in its sole discretion refuse to accept or may return the payment
order.
5. TERMINOLOGY. Unless specifically defined in this Security Procedure
Agreement, terms used herein have the meanings, if any, provided in the
Agreement and the other Service Documentation, as each may be amended from
time to time.
TM-1425 ACH Services Security Procedure Agreement - Revised 6/19/2002
Page 2 of 2
XXXXX
FARGO
ACH SERVICES DESCRIPTION
1. THE ACH SERVICES (THE "SERVICES"). The Services, one or more of which
have been separately designated by Company in the ACH Services Set-up
Form delivered to Bank, are generally described as follows:
1.1. ORIGINATION SERVICES.
1.1.1. DIRECT ACH ORIGINATION. The Direct ACH Origination
Service will enable Company, using Company's software, to create
entries and files in standard ACH format and send them electronically
to Bank for transmission in accordance with the Rules (see Subsection
4.1).
1.1.2. THIRD PARTY ACH ORIGINATION. The Third Party ACH
Origination Service will enable Company's agent, using that agent's
software, to create entries and files in standard ACH format and send
them electronically to Bank for transmission in accordance with the
Rules (see Subsection 4.1).
1.1.3. ACH EXPRESS. The ACH Express Service will enable
Company to create entries and files in standard ACH format at its own
personal computer and send them electronically to Bank for transmission
in accordance with the Rules (see Subsection 4.1). All files
transmitted through the ACH Express Service must be created and
transmitted to Bank using software specified by Bank which is the
original, confidential, valuable and proprietary property of Xxxxxxxx &
Xxxxx (the "Software"), which has licensed it to Bank, or to an
affiliate of Bank, with the right to sublicense it to Company. Bank
grants Company a non-exclusive and non-assignable sublicense to use the
Software solely for the purpose of initiating entries in accordance
with the provisions of the license (a copy of which is available to
Company on request), this ACH Services Description and the other
Service Documentation. This sublicense will terminate upon the earlier
to occur of termination of the license or termination of this Service.
Upon termination, Company will promptly return all copies of the
Software to Bank.
1.1.3.1. IN NO EVENT WILL BANK BE LIABLE FOR ANY
INCIDENTAL, SPECIAL, EXEMPLARY, OR CONSEQUENTIAL DAMAGES, INCLUDING BUT
NOT LIMITED TO LOST DATA, PROGRAMS, PROFITS (ANTICIPATED, ACTUAL OR
OTHERWISE), OR BENEFITS RESULTING FROM USE OF, RELIANCE UPON, OR
INABILITY TO USE THE SOFTWARE, REGARDLESS OF WHETHER OR NOT BANK HAS
BEEN INFORMED OF THE POSSIBILITY OF SUCH DAMAGES AND REGARDLESS OF
WHETHER SUCH DAMAGES ARE BASED ON CONTRACT, TORT (INCLUDING
NEGLIGENCE), STRICT LIABILITY, OR ANY OTHER THEORY OR FORM OF ACTION.
IN NO EVENT WILL BANK'S CUMULATIVE LIABILITY TO COMPANY IN RELATION TO
THIS SUBLICENSE EXCEED A SUM EQUAL TO THE TOTAL SUBLICENSE FEE ACTUALLY
PAID TO BANK. COMPANY ACKNOWLEDGES THAT NEITHER XXXXXXXX AND XXXXX NOR
BANK MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION THE WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A
PARTICULAR PURPOSE.
1.1.3.2. Company agrees that, if required by law, the
Software will not be exported directly or indirectly, separately or as
a part of a system, without first obtaining a license from the United
States Department of Commerce or any other appropriate agency of the
United States Government.
1.1.3.3. Bank may make copies of any enhanced
versions of the Software available to Company at such price as Bank
will determine at its sole discretion. Company acknowledges that
Xxxxxxxx and Xxxxx has the right to enforce the terms of the license
directly against Company in the event of a breach of its terms by
Company. Company may not assign the license or this sublicense to
anyone. Bank may discontinue to provide to Company any maintenance or
other support with respect to the Software which it now, or hereafter
provides upon prior written notice to Company.
TM-1423 ACH Services Description - Revised 7/2002 page 1 of 6
1.1.3.4. Company will not publish, disclose, display
or otherwise make the Software available to others. Company will secure
and protect the Software in a manner consistent with the protection of
its own proprietary information and take appropriate action by
instruction or agreement with its employees who are permitted access to
the Software to ensure such protection. Company acknowledges that,
except as specifically permitted in writing by Bank, Company will not
provide, transmit, further sublicense, transfer or otherwise distribute
the Software or any part of it to a third party, or copy, reverse
engineer, reverse compile, or reverse assemble, modify or alter the
Software or any part of it.
1.1.4. INTERNATIONAL ACH. The International ACH Service will
enable Company to create entries and files using a modified NACHA
format for the purpose of debiting or crediting selected country
accounts held outside the United States and send them electronically to
Bank for transmission in accordance with the Rules (see Subsection
4.1), which for purposes of International ACH shall also include the
International ACH Origination Reference Guide, the Cross-Border Payment
Operating Rules, and any other applicable ACH rules, including those
promulgated by a local ACH association or governmental body ("Other ACH
Rules." ) For purposes of originating credits and debits to a USD or
CAD denominated account located in Canada, the Other ACH Rules shall
include the Rules of the Canadian Payments Association (the "CPA
Rules.")
1.1.4.1. With respect to credit entries, Bank will
convert the amount to be transferred from United States Dollars to the
currency of a designated foreign government or intergovernmental
organization ("Foreign Currency") at Bank's buying rate for exchange in
effect on the date the entry is transmitted by Bank to the ACH or
gateway operator. If the financial institution designated to receive
the funds does not pay the beneficiary specified in the entry, or if
the entry is subsequently determined to be erroneous, Bank will not be
liable for a sum in excess of the value of the entry after it has been
converted from Foreign Currency to United States Dollars at Bank's
selling rate for exchange at such time as the entry is returned to
Bank.
1.1.4.2. With respect to debit entries (where
permitted), Bank will convert the amount of each Entry from Foreign
Currency at Bank's selling rate for exchange in effect on the
settlement date of the entry. If the financial institution designated
to receive the entry subsequently returns it, Bank may charge the
Account (see Subsection 4.2) for the sum equal to the value of the
returned entry as measured in Foreign Currency at Bank's buying rate
for exchange at such time as the entry is returned to Bank.
1.1.4.2.1. Before Company may intiate any debit
entries that settle to a USD or CAD denominated account located in
Canada , it will be required to: (a) sign and return to Bank the Payee
Letter of Undertaking for Canadian Pre-Authorized Debits provided by
Bank; and (b) collect from each payor of a debit a debit authorization
in a form which complies with the CPA Rules. Company acknowledges that
Bank has provided it with a means for accessing the CPA Rules,
including Rule H1.
1.1.4.3. Bank will not be liable for any failure or
delay by a gateway operator, any intermediary financial institutions,
or the receiving depository financial institution in the designated
foreign country in processing or failing to process any entry Bank
transmits, or for acts or omissions by a third party, including by way
of example and not by way of limitation, the delay or failure of any
third party to process, credit or debit any entry.
1.1.4.4. Company acknowledges that the ACH system may
not be used to conduct any transaction in violation of Federal law.
Company expressly warrants that no Entry delivered to Bank will, if
acepted by Bank, cause Bank to be in violation of any sanction
administered by the Office of Foreign Assets Control.
1.1.5. INTERNET ACH. Internet ACH will enable Company to
originate ACH transactions via the Internet. Company will provide for
its own access to the Internet through either an Internet service
provider or through a local area network connection to an Internet
service provider. If Company's service provider is unable to provide
access at any time, Company will not be able to access the Service.
After Company has successfully completed the authentication process and
obtained access to the Service.
TM-1423 ACH Services Description - Revised 7/2002 page 2 of 6
Company will build a database of payment transactions. Company's database
and applications will reside on a Bank owned and managed server. Company
will, from that database, create a batch. Company will be responsible for
verifying its batch totals and settlement date. Once verified, Company
will only need to press a button to "release" that batch to Bank for
processing. Bank will create a file of released batches in standard ACH
format and process the file in accordance with the Rules (see Subsection
4.1)
1.2. RECEIVING SERVICES.
1.2.1. ACH TRANSACTION FILTER. The ACH Transaction Filter Service will
enable Company to better protect its accounts at Bank from unauthorized debit
entries. Bank offers three options that monitor the debit entries posted to
accounts. Company has elected one of the following options on the ACH Services
Set-up Form:
o to have all debit entries automatically blocked from its account(s);
o to have all debit entries presented to it for review and its request
for further action; or
o to authorize specific debit entries to be posted to its account(s).
If Company has chosen the review option (see the middle bullet above), it will
immediately review each Intercept Report and notify Bank in the manner and by
the applicable cutoff time as required in the Guide of any debit entry listed on
the Intercept Report which is unauthorized. If it does not, Bank will be
entitled to post the debit entry to Company's account.
1.2.2. ACH INVESTMENT FUND. The ACH Investment Fund Service will enable
Company to offer direct deposit or direct payment arrangements to its customers.
Bank will prepare detailed transaction information which it will send to Company
in one file each morning on a business day. Company has elected either
individual postings or a consolidated settlement of transactions on the ACH
Services Setup Form.
2. PROVISIONS APPLICABLE ONLY TO ORIGINATION SERVICES.
2.1. SECURITY PROCEDURE. Bank will verify that Company has authorized,
canceled or amended an entry that constitutes a payment order (as that term is
defined in Section 4A-103(a)(1) of the Uniform Commercial Code, as amended from
time to time) solely by means of the security procedure separately agreed to in
writing by Bank and Company. The security procedure will not be used to detect
errors. Company will promptly notify Bank in writing of the identity of each
person authorized to receive information regarding the security procedure (each
singly or in the aggregate, an "authorized person") and of any change in an
authorized person. Bank will have a reasonable time after receipt of a notice to
act on it. Company will establish and maintain effective internal procedures to
safeguard against unauthorized transmissions and batch releases. Company
warrants that no individual will be allowed to initiate transfers or batch
releases in the absence of proper supervision and safeguards, and Company will
take reasonable steps to maintain the confidentiality of the security procedure
and any passwords, codes, security devices and related instructions provided by
Bank. If Company believes or suspects that any such information or instructions
have been known or accessed by unauthorized persons, Company will notify Bank
immediately followed by written confirmation. Bank will have a reasonable time
after receipt of notice to act on it. If a payment order, or a request for
cancellation or amendment of a payment order, received by Bank purports to have
been transmitted or authorized by Company, it will be deemed effective as
Company's payment order or request and Company will be obligated to pay Bank the
amount of the payment order even though the payment order or request was not
authorized by Company, provided Bank accepted the payment order in good faith
and acted in compliance with the security procedure. If a payment order, or
request for cancellation or amendment of a payment order, received by Bank was
authorized by Company, Company will pay Bank the amount of the payment order,
whether or not Bank complied with the security procedure with respect to that
payment order.
2.2. REJECTED ENTRIES. Without limiting Bank's general right to reject
entries or files under the Rules, Bank may reject any entry or file which does
not comply with the requirements in this Service
TM-1423 ACH Services Description - Revised 7/2002 page 3 of 6
Description, the Rules or the security procedure, or with respect to which the
Account (see Subsection 4.2) does not contain sufficient available funds to pay
for the entry. Bank may reject an entry received for credit to an account
maintained at Bank (an "on-us entry") for any reason for which an entry may be
returned under the Rules. If an entry or file is rejected, Bank will make a
reasonable effort to notify Company promptly so that Company may repair and
retransmit the entry or file. A notice of rejection will be effective when
given. Bank will have no liability to Company by reason of the rejection of any
entry or file, the fact that notice is not given at an earlier time than that
provided for in this Service Description or for any loss resulting from Bank's
failure to provide notice. If Company requests that Bank repair an entry or file
and Bank endeavors to do so, Bank will not be liable for its failure to make the
requested repair. Company will pay all charges and expenses Bank incurs in
connection with file repairs.
2.3. PAYMENT OBLIGATIONS; SETTLEMENT. Company will maintain in the
Account (see Subsection 4.2) as of the applicable settlement date and time
immediately available funds sufficient to cover all credit entries Company
originates through Bank. If requested, the funds will be prepaid to Bank before
Bank delivers the credit entries to the ACH or gateway operator. Company's
obligation to pay Bank for each credit entry matures at the time Bank transmits
or otherwise delivers the credit entry to the ACH or gateway operator and is
unaffected by termination of the Services. Bank is authorized to debit the
Account for the total amount of all credit entries on or before the applicable
settlement date. Bank is not, however, intending to make a loan to Company.
Notwithstanding any other provision of this Service Description or the other
Service Documentation, Bank is authorized upon notice to Company to place a hold
on an equal amount of funds in the Account or in any other accounts at Bank or
any affiliate of Bank owned in whole or in part by Company, or to take any other
action it deems appropriate to ensure that it receives payment. Bank may charge
the Account or any other Company account at Bank or any affiliate of Bank for
any debit, correcting or reversing entry which is later returned to Bank. Bank
may also set off against any amount it or an affiliate of Bank owes to Company
in order to obtain payment of Company's obligation as set forth in this Service
Description.
2.4. CANCELLATION OR AMENDMENT. Company will have no right to cancel or
amend any entry or file after its receipt by Bank. However, if the request
complies with the security procedure Bank may use reasonable efforts to act on
it prior to transmitting the entry or file to the ACH or gateway operator or, in
the case of an on-us entry, prior to crediting a receiver's account, but will
have no liability if the cancellation or amendment is not effected. Company will
reimburse Bank for any expenses, losses or damages Bank may incur in effecting
or attempting to effect Company's request.
2.5. RETURNED ENTRIES. Except for an entry or file retransmitted by
Company in accordance with the requirements of this Service Description, Bank
will have no obligation to retransmit a returned entry or file to the ACH or
gateway operator if Bank complied with the terms of this Service Description
with respect to the original entry or file.
2.6. PREPARATION OF ENTRIES AND FILES; PROCESSING SCHEDULES;
RECONSTRUCTION. Each entry and file delivered to Bank, including any amendments,
cancellations, reversals, corrections or changes related to it will be prepared
in accordance with the Rules, the Service Documentation and Bank's then current
instructions. Bank will process each entry or file in accordance with its then
current processing schedule, provided (i) the entries or files are received by
Bank's applicable cut-off time on a business day and (ii) the ACH is open for
business on that business day. Entries or files will be deemed received by Bank,
in the case of transmittal by tape, when received by Bank at the location stated
in the ACH Services Set-up Form, and in the case of transmittal by electronic
transmission, when the transmission (and compliance with any applicable security
procedure) is completed. If Bank receives an entry, file or batch release after
its processing deadline, Bank will not be responsible for failure to meet the
deadlines of the ACH operator for processing and transmitting the entries or
files. If any of the requirements of clause (i) or (ii) of this Subsection 2.6.
are not met, Bank will use reasonable efforts to transmit the entries or files
to the ACH by the next applicable deadline of the ACH which is on a business day
on which the ACH is open for business. Except as provided in Subsection 2.4, in
the case of an on-us entry, Bank will credit the receiver's account in the
amount of the entry on the Effective Entry Date contained in any instructions
accompanying the entry, provided the requirements set forth in clauses (i) and
(ii) of this Subsection 2.6 are met. If either of those requirements is not met,
Bank will use reasonable efforts to credit the receiver's account in the amount
of the entry no later than the next business day following the Effective Entry
Date. Company will retain copies of each entry and file delivered to Bank or
will be able to fully and
TM-1423 ACH Services Description - Revised 7/2002 page 4 of 6
completely reconstruct each entry and file for a period of five (5) business
days after the applicable settlement date and will submit the copy or
reconstructed entry or file to Bank upon request.
2.7 EFFECTIVE ENTRY DATE. The instructions accompanying an entry or
file will specify a business day on which the entry or file is to be delivered
to the ACH or gateway operator (the "Effective Entry Date").
3. PROVISIONS APPLICABLE ONLY TO RECEIVING SERVICES.
3.1. NOTICE TO RECEIVER. Unless required by applicable law, Bank will
have no obligation to notify Company of the receipt of an entry, other than by
showing it on the periodic statement for the affected deposit account (see
Subsection 4.2).
4. PROVISIONS APPLICABLE TO BOTH ORIGINATION AND RECEIVING SERVICES.
4.1. RULES. Origination, receipt, return, adjustment, correction,
cancellation, amendment and transmission of ACH entries must be in accordance
with the Operating Rules of the ACH in which Bank is a participant and, with
respect to credit entries which constitute payment orders, Article 4A of the
Uniform Commercial Code as adopted in the state whose law governs the Agreement,
as both are varied by this Service Description and the other Service
Documentation, and as both are amended from time to time (the "Rules"). Company
acknowledges that it has had an opportunity to review and agrees to comply with
and be bound by the Rules. Company will be responsible for promptly obtaining
all future amendments.
4.2. ACCOUNT. Company will maintain at least one deposit account with
Bank as designated in the ACH Services Set-up Form (the "Account").
4.3. PROVISIONAL CREDIT. Any credit Bank gives to Company is
provisional until Bank receives final settlement and the entry for which credit
was given is deemed to be finally paid as provided in this Service Description,
the Rules and all laws, rules and regulations governing any aspect of the entry,
including the laws, rules and regulations of the country to which the entry was
sent. If Bank does not receive final settlement, it is entitled to a refund from
the credited person and Company will not be deemed to have paid that person.
4.4. REVERSING ENTRIES. At Company's request, Bank will make a
reasonable effort to reverse an entry, but will have no responsibility for the
failure of any other person or entity to honor Company's request.
4.5. WARRANTIES. Company acknowledges that under the Rules, Bank makes
certain warranties with respect to each entry. Company agrees to reimburse Bank
for any loss Bank incurs, including its reasonable attorneys' fees and legal
expenses, as the result of a breach of a warranty made by Bank unless the breach
resulted solely from Bank's own negligence or intentional misconduct.
4.6. Indemnification. Company acknowledges that under the Rules, Bank
indemnifies certain persons. Company agrees to reimburse Bank for any loss Bank
incurs, including its reasonable attorneys' fees and legal expenses, as the
result of the enforcement of an indemnity, unless enforcement resulted solely
from Bank's own negligence or intentional misconduct.
4.7. IDENTIFY AUTHORIZED PERSONS. Any person identified by Company in
the ACH Services Set-up Form or any certification, notice or other communication
delivered to Bank may receive information, communications and notices regarding
the Services, and is authorized to transact all business, make all agreements
and sign and deliver all documents in connection with the Services. If the
identity of such a person changes Company will promptly notify Bank in writing.
Bank will have a reasonable time after receipt of a certification, notice or
other communication to act on it.
4.8. AGENTS. If Company elects to use an agent with respect to the
Services, Company, and not Bank, will be solely responsible for the acts and
omissions of Company's agent, and its agent will,
TM-1423 ACH Services Description - Revised 7/2002 page 5 of 6
without limitation, be authorized to originate, receive, return, adjust,
correct, cancel, amend and transmit entries and files, and select the security
procedure used to authenticate entries. Company agrees that any security
procedure selected by its Agent will be treated as commercially reasonable for
all purposes. Bank may rely on instructions it receives from Company's agent and
need not make any inquiries to verify or confirm that instructions are within
the scope of the agency.
4.8.1. Company will certify each agent's identity and any changes to
Bank in writing. Bank will be fully protected in relying on each certificate and
on the obligation of Company to promptly certify any change in the agents so
certified. Bank will have a reasonable time after receipt of a certification or
change to act on it.
4.8.2. Bank may at any time use agents and/or independent contractors
to process entries or provide all or any other portion of the Services, and will
be solely responsible for the acts and omissions of its agents and independent
contractors. However, Bank will not be deemed to be the agent of, nor
responsible for the acts or omissions of any other person, including without
limitation any Federal Reserve Bank, ACH, Internet service provider or
transmission or communications facility, any receiver or receiving depository
financial institution (including without limitation the return of an entry by
such receiver or receiving depository financial institution), and no such person
will be deemed Bank's agent.
4.9. SOFTWARE, HARDWARE AND BACKUP REQUIREMENTS. Subject to Paragraph
1.1.3, Company will, at its own cost and expense, obtain, install and, at all
times during its utilization of the Services, maintain in good working order all
software, hardware and other equipment necessary for it to perform in accordance
with this Service Description. Except with respect to the Internet ACH Service,
Company agrees to implement, on a periodic basis not less than weekly,
backup-measures, including, among other things, copying onto a diskette(s) each
week's current data base files. With respect to the Internet ACH Service, Bank
will perform data base backup on a scheduled basis. In the event of any failure
of such software, hardware or other equipment, Company will deliver to Bank all
data which it would otherwise have provided that is necessary for Bank to
perform Bank's obligations in connection with the Services.
4.10. SURVIVAL. Subsections 2.3, 4.3, 4.5, 4.6 and 4.10 will survive
termination of the Services.
4.11. TERMINOLOGY. Unless specifically defined in this Service
Description, terms used in this Service Description have the meanings, if any,
provided in the Rules, as amended from time to time. As used in this Service
Description, "negligence" will mean a material failure to use that degree of
care that would be used under the same or similar circumstances by a national
banking association having substantially the same volume and type of ACH
activity and approximately the same number, size and diversity of ACH customers.
TM-1423 ACH Services Description - Revised 7/2002 page 6 of 6
XXXXX
FARGO
COMMERCIAL ELECTRONIC OFFICE ("CEO")
SERVICE DESCRIPTION
1. DESCRIPTION OF THE CEO SERVICE. The CEO Service will allow Company to
enter Bank's CEO website and access those treasury management services
offered through the CEO (each, a "Service") for which Company has
enrolled. Company agrees to use the CEO only as provided in the Service
Documentation (which term includes notices and information posted on
the CEO website.) Persons entering the CEO for Company (the "Users")
must also accept the Terms of Use for the CEO which appears on the CEO
when a User initially logs on. Before Company may use a Service,
Company must sign or accept the Service Documentation for that Service.
2. SECURITY PROCEDURES.
2.1 Unless Company requests self-administration of its access to
the CEO, Bank will give each User an ID code and a password to
be used when the User first enters the CEO.
(Self-administration may not be available for all services
offered through the CEO.) Bank will also assign a Company ID
code for use each time a User enters the CEO. Although the
Company ID code and the ID codes for each User will remain the
same for each entry into the CEO, the password Bank assigns to
each User must be changed to a new password the User selects
when the User first enters the CEO. Bank will not know the new
passwords or any subsequent passwords selected by the Users.
2.2 If Company requests self-administration of its access to the
CEO, Bank will assign a Company ID code and will set up the
first Company administrator ("FCA") by assigning a personal ID
code and password to be used when the FCA first enters the
CEO. The FCA can then set up additional Company administrators
(who will have access to all Services Company receives through
the CEO) and administrators or Users (each of whom will have
access only to the specific Service(s) they are set up to
access.) Any Company administrator: (a) can set up additional
Company administrators, administrators and Users, issuing them
a password and a personal ID code; (b) can reset passwords for
all Services; and (c) shall be required to immediately disable
access to the CEO for any Company administrator, administrator
or User who ceases to be a Company administrator,
administrator or User. Administrators can set up additional
administrators and Users and reset passwords for the specific
Service(s) they are set up to access. The Company ID and each
personal ID code will remain the same for each entry into the
CEO, but the password assigned to each Company administrator,
administrator, and User must be changed to a new password they
select when they first enter the CEO. Bank will not know the
password of any Company administrator, administrator, or User
except the initial password assigned to the FCA. Company's
administrative contact with respect to the CEO will be the
FCA.
2.3 If Company requests self-administration of Company's access to
the CEO, Bank will give the Company administrators and the
administrators a token card and a personal identification
number ("PIN"), known only by them and Bank, to use each time
they give personal ID codes and passwords to Company
administrators, administrators, and Users. Token cards and
PINs will be given to Users by Bank only if they have access
to a Service which requires a token card for access. The token
card generates a random and unique security code for each
token card every minute. The code combines with the PIN to
provide a unique password (the "Passcode") every minute.
2.4 Company will be able to manage and control who in Company has
access to the CEO and the Services by the ID codes, passwords,
token cards, PINs, and Passcodes. It is Company's
responsibility to ensure that the ID codes, passwords, token
cards, PINs, and Passcodes are known to, and used only by,
persons who have been properly authorized by Company to access
the CEO and use the Services through the CEO.
TM-1426 Commercial Electronic Office Service Description (Rev. 9/02 )
Page 1 of 3
2.5 FAILURE TO PROTECT ID CODES, PASSWORDS, TOKEN CARDS, PINS, OR
PASSCODES MAY ALLOW AN UNAUTHORIZED PARTY TO (1) USE THE
SERVICES, (2) CORRECT, CHANGE, VERIFY, OR SEND DATA USED WITH
THE SERVICES, (3) SEND INFORMATION AND COMMUNICATIONS TO, OR
RECEIVE INFORMATION AND COMMUNICATIONS FROM, BANK OR (4)
ACCESS COMPANY'S ELECTRONIC COMMUNICATIONS AND FINANCIAL DATA.
ALL ENTRIES INTO THE CEO, ALL COMMUNICATIONS SENT, AND ALL
USES OF THE SERVICES, THROUGH COMPANY'S ID CODES, PASSWORDS,
TOKEN CARDS, PINS, OR PASSCODES WILL BE DEEMED TO BE ENTRIES,
COMMUNICATIONS, AND USES AUTHORIZED BY COMPANY AND BE BINDING
UPON COMPANY. COMPANY ASSUMES THE ENTIRE RISK FOR THE
FRAUDULENT OR UNAUTHORIZED USE OF ALL ID CODES, PASSWORDS,
TOKEN CARDS, PINS, AND PASSCODES. Company acknowledges the
importance of developing internal procedures to limit such
risk, which procedures will include, at a minimum, (a) if
Company is not on self-administration, notifying Bank
immediately when any new person becomes a User or when any
existing User stops being a User, (b) if Company is on
self-administration, disabling access to the CEO immediately
for each Company administrator, administrator, and User who
stops being a Company administrator, administrator, or User,
and (c) not keeping, in any form or in any place, lists of ID
codes, passwords, PINs or Passcodes.
2.6 Company agrees to notify Bank immediately when Company becomes
aware of any loss or theft of, or any unauthorized use of, any
ID codes, passwords, token cards, Pins, or Passcodes. Company
also agrees to notify Bank immediately when Company becomes
aware of any unauthorized entry into the CEO.
3. FINANCIAL INFORMATION. Financial market data, quotes, news, research,
and other financial information developed by third parties and
transmitted to Bank (collectively, "Financial Information") will be
available at the CEO. The posting of any Financial Information or any
other information or data at the CEO will not be a recommendation by
Bank that any particular Service or transaction is suitable or
appropriate for Company or that Company should receive or in any way
use any Service. Bank does not guarantee the accuracy, completeness,
timeliness or correct sequencing of any Financial Information, nor is
it in any way responsible for the actions or omissions of the third
parties developing or transmitting Financial Information or for any
decision made or action taken by Company in reliance upon any Financial
Information.
4. USE OF CERTAIN SOFTWARE TO ACCESS THE CEO. In using the CEO, Company
will be sending financial and other data as well as electronic messages
directly to Bank through the Internet. Company acknowledges that when
the Internet, or any other electronic communications facilities, are
used to transmit or receive data and messages, the data and the
messages may be accessed by unauthorized third parties. To reduce the
likelihood of such third party access, Company agrees to transmit and
receive data and messages through the CEO using only software,
including, but not limited to, browser software, or other access
devices that support the Secure Socket Layer (SSL) protocol- or other
protocols required by, or acceptable to, Bank, and to follow the Bank
log-on procedures that support such protocols.
5. DISCLAIMERS. Bank will not be Company's advisor or fiduciary with
respect to this Agreement or any Service.
6. LIMITATION OF LIABILITY. Bank will not be liable to Company for any
direct or indirect damages or losses suffered or incurred by Company in
connection with the CEO, any of the Services, any Financial
Information, any other information or data Company receives through the
CEO, or any failure to provide, or delay in providing, access to the
CEO, any Service, or any Financial Information, except to the extent
any Service Documentation specifically provides otherwise and except to
the extent such damages or losses arise directly from the negligence or
willful misconduct of Bank .
TM-1426 Commercial Electronic Office Service Description (Rev. 9/02 )
Page 2 of 3
7. RESTRICTING OR TERMINATING ACCESS TO THE CEO. In addition to, and not
in substitution for, any provision in this Agreement or any of the
other Service Documentation, Company understands and agrees that Bank
will not in any way be obligated to permit Users access to any
Financial Information or the use of any Service through the CEO if (a)
such use or access is not in accordance with any term or condition
applicable to the Service or the CEO or to the information to be
accessed, (b) such use or access is not permitted by any state or
federal law or regulation, (c) Bank has reasonable cause to believe
that such use or access may not be authorized by Company or any third
person whose authorization Bank believes is necessary for such use or
access, or (d) Bank has reasonable cause to deny such use or access for
Company's protection or the protection of Bank . If any Service cannot
be used through the CEO, Bank will make reasonable efforts for such
Service to be used by other means. Bank shall not have liability to
Company for any losses or damages Company may suffer or incur as a
result of any such termination.
8. SURVIVAL. Sections 3,6,7 and 8 will survive termination of the Service.
9. TERMINOLOGY. Unless specifically defined in this Service Description,
capitalized terms used in this Service Description have the meanings,
if any, provided in the Master Agreement for Treasury Management
Services (the "Agreement"), as amended from time to time.
TM-1426 Commercial Electronic Office Service Description (Rev. 9/02 )
Page 3 of 3
XXXXX
FARGO
WIRE TRANSFER SERVICES DESCRIPTION
1. DESCRIPTION OF THE WIRE TRANSFER SERVICES (THE "SERVICES"). The
Services will enable Company to give instructions ("Orders") to Bank to
(i) transfer funds by wire from the account(s) designated in the Wire
Transfer Services Set-up Forms (the "Account"), and (ii) instruct
another depository institution to debit an account at that institution
and transfer the funds to Bank or debit the Account at Bank and
transfer the funds to that institution ("Drawdown Requests"). In this
Service Description, the term "Transfer Instruction" refers to both
Orders and Drawdown Requests. This Service Description is in addition
to, and not in place of, any other agreement which Company may have
entered into with Bank regarding Wire Transfer Instructions.
2. SECURITY PROCEDURE. Company agrees that Bank may verify that Company
has authorized a Transfer Instruction solely in accordance with the
Wire Transfer Services Security Procedure Agreement then in effect (the
"Security Procedure"). The Security Procedure will not apply to
Transfer Instructions delivered to Bank in person by Company or its
authorized representative. The Security Procedure will not be used to
detect erroneous Transfer Instructions. Company agrees that the
Security Procedure it selected is commercially reasonable and is the
Security Procedure that best meets its requirements given the size,
type and frequency of the Transfer Instructions Company will issue to
Bank. Company further agrees to safeguard any number, code, password,
test key, or other identifier assigned to it from discovery by any
unauthorized person. If Company has chosen the telephone verification
option and the individual contacted by Bank identifies himself or
herself as an individual designated by Company and confirms that the
Transfer Instruction was sent to Bank by Company, Bank will be
conclusively deemed to have complied with the telephone security
procedure. If Company becomes aware of a breach of the Security
Procedure, or suspects that a breach may occur, it will immediately
notify Bank in a time and manner that gives Bank a reasonable
opportunity to act on it.
3. IDENTIFY AUTHORIZED PERSONS. Company will notify Bank in writing of the
identity of each individual authorized to receive information regarding
the Security Procedure. Company will promptly notify Bank in writing of
any change in an authorized individual. Company's notice will be
binding on Bank if it is received in a time and manner that gives Bank
a reasonable opportunity to act on it. Bank will be fully protected in
relying on Company's notices. Bank may, but will not be required to,
electronically record any oral communication that it receives from
Company.
4. AUTHORIZATION TO PAY. Company authorizes and instructs Bank to pay any
Order that complies with the Security Procedure. For each Transfer
Instruction executed by Bank in accordance with the terms of this
Service Description, Company authorizes Bank to debit or credit, as
applicable, the account specified in the Transfer Instruction (and if
no account is specified, the Account or any other account of Company at
Bank or an affiliate) even if a debit results in an overdraft. Company
agrees to have sufficient available funds in the account specified in
the Transfer Instruction (and if no account is specified, the Account)
at the time of each debit.
5. FINALITY OF TRANSFER INSTRUCTIONS. A Transfer Instruction will be final
and will not be subject to stop payment or recall, except that Bank
may, at Company's request, make an effort to effect such stop payment
or recall. In that case, Bank will incur no liability for its failure
or inability to do so.
TM-1440 Wire Transfer Service Description Page 1 of 3
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6. INCONSISTENCY OF NAME AND NUMBER. If a Transfer Instruction describes
the person to receive payment inconsistently by name and account number
(i) payment may be made on the basis of the account number even if the
account number identifies a person different from the named person or
(ii) Bank may in its sole discretion refuse to accept or may return the
Transfer Instruction. If a Transfer Instruction describes a
participating financial institution inconsistently by name and
identification number, the identification number may be relied upon as
the proper identification of the financial institution. If a Transfer
Instruction identifies a nonexistent or unidentifiable person or
account as the beneficiary or beneficiary's account, Bank may in its
sole discretion refuse to accept or may return the Transfer
Instruction.
7. COMPANY'S DUTY TO EXERCISE ORDINARY CARE. Company will exercise
ordinary care to determine whether a Transfer Instruction accepted by
Bank was either erroneous or not authorized and to notify Bank of the
facts within a reasonable time not exceeding fourteen (14) days after
Company has received notification from Bank that the Transfer
Instruction was accepted or that the Account was debited or credited
with respect to the Transfer Instruction, whichever is earlier. Company
will be precluded from asserting that Bank is not entitled to retain
payment for a Transfer Instruction unless Company objects within the
fourteen (14) day period.
8. INFORMATION REQUESTS. Company may request the issuance of tracer
messages concerning uncompleted transfers. Company will provide Bank
with any transaction information it considers necessary to process
Company's inquiry. In addition to Bank's fees for this service, Company
will reimburse Bank for any charges it incurs from third parties in
connection with Company's requested tracer messages.
9. INTERNATIONAL WIRE TRANSFERS. A Transfer Instruction expressed in U.S.
Dollars will be sent in
U.S. Dollars. Company may request that prior to executing an Order or
outgoing Drawdown Request, Bank converts the amount to be transferred
from U.S. Dollars to the currency of a designated foreign government or
intergovernmental organization ("Foreign Currency") at Bank's selling
rate for exchange in effect on the date the Order or outgoing Drawdown
Request is executed by Bank. If the financial institution designated to
receive the funds does not pay the beneficiary specified in the Order
or outgoing Drawdown Request and it is payable in Foreign Currency,
Bank will not be liable for a sum in excess of the value of the Order
or outgoing Drawdown Request after it has been converted from Foreign
Currency to U.S. Dollars at Bank's buying rate for exchange at the time
the cancellation of the Order or outgoing Drawdown Request is confirmed
by Bank.
10. RESPONSIBILITY OF BANK. Bank is only responsible for making a good
faith effort to execute Company's Transfer Instructions. Transfer
Instructions may be sent by wire, telegraph, telephone, cable l or
whatever other transmission method Bank considers to be reasonable.
Orders and outgoing Drawdown Requests may be transmitted directly to
the beneficiary's financial institution, or indirectly to the
beneficiary's financial institution through another financial
institution, government agency or other third party that Bank considers
to be reasonable. Bank may execute an incoming Drawdown Request that
conforms with instructions it receives through Fed Wire, SWIFT or any
other funds transfer system, provided such instructions are not
inconsistent with instructions contained in an applicable Set-up Form.
The authority to execute the incoming Drawdown Request shall continue
until Bank receives express written notice from Company that such
authority is revoked. Bank will not be liable for any third party's
failure to or delay or error in processing a Transfer Instruction. If
the beneficiary bank does not pay the beneficiary specified in the
Transfer Instruction, a refund will be made only after Bank has
received confirmation of the effective cancellation of the Transfer
Instruction and Bank is in free possession of the funds debited or
earmarked in connection with the Transfer Instruction. If
TM-1440 Wire Transfer Service Description Page 2 of 3
Revised 10/02
Bank is notified that it did not transfer the full amount stated in a
Transfer Instruction, Bank's sole obligation will be to promptly
execute a second Transfer Instruction in the amount of the stated
deficiency. If Bank executes a Transfer Instruction in excess of the
amount stated in the Transfer Instruction, to the extent that the
originator does not receive the benefit of the Transfer Instruction,
Bank will only be liable for any loss of the principal amount
transferred in excess of the amount stated in the Transfer Instruction.
Additionally, Bank will be liable for the amount of interest the
originator has lost due to the transfer of the excess amount, computed
at the then current Federal Funds rate. However, Bank's liability for
loss of interest will be limited to twenty (20) calendar day's
interest. This section sets forth Bank's complete liability for a
Transfer Instruction issued or received under this Service Description.
IN NO EVENT WILL BANK BE LIABLE FOR DAMAGES ARISING DIRECTLY OR
INDIRECTLY IF THE TRANSFER INSTRUCTION IS EXECUTED BY BANK IN GOOD
FAITH AND IN ACCORDANCE WITH THE TERMS OF THIS SERVICE DESCRIPTION.
As used in the Master Agreement for Treasury Management Services (the
"Agreement"), with respect to the Services, "negligence" means a
material failure to use the degree of care used under similar
circumstances by a national bank having a similar volume of funds
transfers and similar number, size and diversity of funds transfer
customers.
11. GOVERNING LAW; RULES AND REGULATIONS. Bank's and Company's rights and
obligations regarding Transfer Instructions will be governed solely by
this Service Description and the other Service Documentation and, to
the extent applicable, federal law and the law of the state in which
Bank's principal office is located, as amended from time to time.
Article 4A of the Uniform Commercial Code will, to the extent possible,
be applied by analogy to any Drawdown Requests. All Transfer
Instructions will also be subject to the rules and regulations of any
funds transfer system used by Bank as amended from time to time. If a
Transfer Instruction is to be processed in accordance with a statute,
rule, regulation or license of the United States, or any federal
agency, the Transfer Instruction will be governed by that statute,
rule, regulation or license.
12. NOTICES; RECEIPT OF CONFIRMATIONS. In addition to the notice provision
set forth in Section 10.6 of the Agreement, the following will apply: A
bank statement showing a Transfer Instruction sent by first class mail
to Company's last address as shown in Bank's records and not returned
will be conclusively presumed to have been received by Company seven
(7) days after it is sent.
13. AGENTS. Bank may use agents of its choice to perform any of its
obligations.
14. SURVIVAL. Sections 4, 7, 9, 10 and 14 will survive termination of the
Services.
15. TERMINOLOGY. Unless specifically defined in this Service Description,
terms used in this Service Description have the meanings, if any,
provided in Article 4A of the Uniform Commercial Code, as amended from
time to time. Each Bank request, instruction and set-up form completed
by or on behalf of Company in connection with the Services will be
deemed to be a "Set-up Form" as that term is used in the Service
Documentation.
TM-1440 Wire Transfer Service Description Page 3 of 3
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