HomeMy WebLinkAboutPhoenix Payment Systems - EPX Merchant AgreementEPX MERCHANT AGREEMENT
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Phoenix Payment Systems, Inc. doing business as Electronic Payment Exchange, a Delaware Corporation, whose
address is 1201 N. Market Street, Suite 701, Wilmington, DE 19801 ( "EPX "), The Bancorp Bank ( "Bank "), a
Delaware Corporation, whose address is 405 Silverside Road, Suite 105, Wilmington, DE 19809 and City of
Gilroy, a California municipal corporation, whose address is 7351 Rosanna Street Gilroy, CA 95020
( "Merchant"), agree as follows:
1. Definitions. For the purposes of this Agreement and the Schedules referred to herein, the following defmitions
apply unless the context otherwise requires:
1.1. "Address Verification" shall mean a service which allows Merchant to verify Cardholder's
billing address with Issuer.
1.2. "Association(s)" shall mean VISA USA, Inc., MasterCard International, Inc. and Discover
Network, a business unit of Discover Financial Services.
1.3. "Authorization" shall mean an affirmative response by or on behalf of an Issuer, to a request to
the EPX System to effect a Transaction, that a Transaction is within the Cardholder's available
credit limit and that the Cardholder has not reported the Card lost or stolen. All Transactions
require Authorization.
1.4. "BRIO" shall mean BuyerWall Recognized Identification Code. The BRIC provides future
transaction functionality typically associated with the storage of cardholder data.
1.5. "Business Day" shall mean any day other than:
i. Saturday or Sunday;
ii. A day on which banking institutions in Delaware are authorized by law or executive order to be
closed (and on which Bank and/or EPX is in fact closed); or
iii. A day on which the Federal Reserve Bank is closed.
1.6. "BuyerWall" shall mean the EPX patent pending technology that utilizes the EPX hosted front -
end applications in conjunction with a unique transaction identifier allowing Merchant to
eliminate contact with credit card numbers during the processing, transmission and storage of
data.
1.7. "Card(s)" shall mean either a Visa, MasterCard or Discover credit card or debit card.
1.8. "Cardholder" shall mean a person authorized to use a Card.
1.9. "Card- Not - Present" shall mean mail order, telephone order, e- commerce (Internet) order, or
other transactions that are not Card - Present Transactions.
1.10. "Card- Present Transaction" shall mean a Transaction in which the Card is swiped through a
terminal, register or other device, capturing the Card information encoded on the magnetic strip.
1.11. "Chargeback" shall mean a Transaction that Bank returns to Merchant pursuant to this
Agreement.
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1.12. "CVV" shall mean a service which allows Merchant to verify Cardholder's possession of Card
through the identification of unique digits on Card.
1.13. "EPX System(s)" shall mean payment processing platform.
1.14. "Forced Sale" shall mean a sales Transaction processed without an approved electronic
authorization number being obtained for the full amount of the sales Transaction at the time the
Transaction is processed.
1.15. "Issuer" shall mean an Association member that issued a Card to a Cardholder.
1.16. "IVR" shall mean interactive voice response unit used for an Authorization.
1.17. "Manuals" shall mean the EPX System and Software associated API guides, manuals and
instructions.
1.18. "Merchant Servicer" shall mean non - members other than the Merchant and EPX that receive,
pass, or store transaction data on their internal systems on behalf of the Merchant. This includes
third party servicers, Web hosting companies, shopping cart providers, and media back -up
companies. Merchant Servicers must be registered with Visa by Bank.
1.19. "Merchant Statement" shall mean an itemized daily and monthly statement of all charges and
credits to the Operating Account.
1.20. "Operating Account" shall mean a demand deposit account at Bank, or other approved financial
institution through which fees, charges and credits due in accordance with this Agreement may
be processed.
1.21. "Pre- Authorized Recurring Order Transactions" shall mean Transactions which have been pre -
authorized by the Cardholder and for which the goods or services are to be delivered or
performed in the future by Merchant without having to obtain approval from the Cardholder each
time.
1.22. "Reserve Account" shall mean an account at Bank for all future liabilities of Merchant to Bank
or EPX which may arise out of this Agreement.
1.23. "Services" shall mean the transaction processing services provided by Bank or EPX under this
Agreement.
1.24. "Software" shall mean any software programs provided by EPX.
1.25. "Transaction" shall mean the acceptance of a Card or information embossed on the Card for
payment for goods sold and/or leased or services provided to Cardholders by Merchant and
receipt of payment from Bank, whether the transaction is approved, declined, or processed as a
Forced Sale. "Transaction" also includes credits and voids.
2. Merchant Obligations and Requirements.
2.1. Merchant Card Processing. Merchant is in the business of selling and/or leasing goods and/or
providing services to its customers. To better serve those customers, Merchant has requested and
Bank and EPX has agreed to permit Merchant's participation in the card processing programs
and services. Without the prior written consent of Bank and EPX, Merchant is not authorized to
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process Transactions for payment for any other type of goods or services. Bank and EPX
reserves the right to establish certain limits on volume of daily, weekly, and monthly transactions
and dollar limits per Transaction which Merchant may process. Merchant agrees to participate in
the credit card processing services program established by Bank and EPX.
2.2. Merchant Account Changes. Merchant shall provide the information required by the Merchant
Profile Setup Form provided to Merchant by EPX and shall promptly notify EPX of any changes
in this information.
2.3. Merchant Operating Account. Prior to accepting any Cards, Merchant shall establish an
Operating Account. Merchant authorizes Bank or EPX to debit all amounts Merchant owes Bank
or EPX herein from the Operating Account, whether maintained at Bank or another financial
institution, at times deemed appropriate by Bank or EPX through the ACH Banking Network or
by a manual debit of the account. Merchant waives any claims for loss or damage arising out of
any charges or debits to the Operating Account against Bank or any other financial institution
where the Operating Account is maintained.
2.4. Reserve Account. Upon execution of this Agreement, no initial reserve is required by Bank or
EPX. For good cause, Bank or EPX may establish a Reserve Account based on future liabilities
of Merchant to Bank or EPX which may arise out of this Agreement, including, but not limited
to, Chargebacks, fines and fees. The Bank or EPX may change the amount of the Reserve
Account as reasonably necessary and Merchant shall be immediately notified of such change.
The Reserve Account may be funded by deduction from payments due Merchant or a charge
against Merchant's Operating Account or against any of Merchant's accounts at Bank. The
Reserve Account will be maintained for a minimum of six (6) months from the termination date
of this Agreement or until such time as Bank or EPX determines that the release of the funds to
Merchant is prudent, commercially reasonable and Merchant's account with Bank and EPX is
fully resolved. Upon expiration of this six (6) month period, any balance remaining in the
Reserve Account will be paid to Merchant. Bank or EPX will inform Merchant in writing of any
charges debited to the Reserve Account during this period.
2.5. Adjustments and Returns. Merchant will maintain a fair exchange and return policy and make
adjustments with respect to goods and services sold and/or leased to its customers whenever
appropriate. If goods are returned, or services are terminated or canceled, or any price is
adjusted, Merchant will prepare and transmit a credit or return Transaction, either electronically
or by paper, for the amount of the adjustment as a deduction from the total amount of
Transactions transmitted that day. If the amount of credit or return Transactions exceeds the
amount of sales Transactions, EPX shall fund the excess via Merchant's Reserve Account and/or
Operating Account. Merchant shall make no cash refunds on Transactions and shall handle all
credit adjustments as provided in this paragraph. If no refund or return will be given, Cardholder
must be advised in writing that the sale is a "final sale" and "no returns" are permitted at the time
of the Transaction. Cardholder also must be advised in writing of any no -cash refund policy, in
store credit only. Merchant shall follow Association reservation/no -show policy. Merchant must
notify Cardholders in writing of this policy on all advance reservations. The Cardholder must be
notified at the time of the reservation of the exact number of days required for reservation deposit
refunds.
2.6. Customer Complaints. Merchant shall respond promptly to inquiries from Cardholders and shall
resolve any disputes amicably. Merchant agrees to maintain the following information in writing
with respect to each claim or defense asserted by a Cardholder for which Merchant has received
notice:
i. The Cardholder's name;
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ii. A unique confirmation number (transaction sequence number, or other identifier) that the
Merchant can use to reference the transaction in subsequent communications with the Bank or
EPX;
iii. The date and time the Cardholder asserted the claim or defense;
iv. The nature of the claim or defense; and
V. The action which Merchant took in an attempt to resolve the dispute.
Upon request, Merchant shall furnish Bank with this information in writing within ten (10) days.
2.7. Auditing and Credit Investi ag tion. Bank or EPX may audit Merchant's compliance with the
terms of this Agreement. Merchant shall deliver such information within ten (10) days after Bank's or
EPX's request, including without limitation, periodic financial statements and information pertaining to
Merchant's financial condition, in a format reasonably acceptable to Bank and EPX. Such information
shall be true, complete and accurate. Merchant authorizes parties contacted by Bank or EPX to release
credit information requested by Bank or EPX and Merchant agrees to provide a separate authorization
for release of credit information if requested.
2.8. Exclusivity. Merchant shall submit all Card Transactions for the payment of City utility charges
by the City's utility customers that are processed through InfoSend solely to Bank and EPX for
processing. In the event that Merchant ceases its relationship with InfoSend, then City shall not
be subject to this provision of exclusivity. If Merchant fails to comply with this provision,
Merchant agrees to pay Bank or EPX, a liquidated damages sum within ten (10) days of the date
of non - compliance. The amount shall equal the greater of
i. $250; or
ii. 80% of the product of:
The average net monthly fees; and the number of months, including any pro rata portion of a
month, then remaining prior to the date on which Merchant may terminate this Agreement in
accordance with it terms.
Merchant agrees that the damages suffered as a result of such non compliance would be extremely
difficult to calculate with precision. For that reason, the parties hereto agree that the liquidated damages
should be computed as set forth above. Any exceptions to this exclusive arrangement must be approved
by Bank and EPX in advance in writing.
2.9. Retention of Original Sales Information. Merchant or EPX on Merchant's behalf shall retain the
information required by Paragraphs 9.1 (Documenting Transactions) and 9.2 (Authorization for
Transactions) for three (3) years from the date of the Transaction. Upon request, Merchant or
EPX on Merchant's behalf shall provide such information within five (5) days of receipt of
request. Failure to meet such time frame or non - delivery of any item or delivery of an illegible
copy of.an item requested by an Issuer shall constitute a waiver by Merchant of any claims and
may result in an irrevocable Chargeback for the full amount of the Transaction.
2.10. EPX Systems. Merchant or its Agent acknowledges that its use of the EPX Systems and
Software is in accordance with the specification provided by EPX. Any Software supplied to
Merchant by EPX is owned by EPX. It is licensed to Merchant and not sold. The Manuals are
protected by copyright laws and international copyright treaties, as well as other intellectual
property laws and treaties. Merchant is prohibited from copying the Software or Manuals related
to the EPX System and Software. Merchant shall not sell, lease, encumber or otherwise dispose
of the Software or Manuals. Merchant acknowledges that the EPX Systems and Software
requires suitable computer hardware to function properly.
3. EPX Obligations and Requirements.
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3.1. EPX to Provide Services to Merchant. During the term of this Agreement, subject to the terms
and conditions of this Agreement, EPX agrees to provide EPX Systems, Software and Manuals
in order to allow Merchant to accept and process Transactions. EPX shall provide EPX Systems
technical support 24 hours per day, 7 days per week, in accordance with EPX's then - current
policies.
3.2. Data Connection. In the event Merchant requires the installation of a dedicated data connection
for electronic transmissions to EPX, Merchant will sign a separate agreement, EPX Third Party
Connection Agreement, which provides policy and guidelines for the use of network and
computing resources associated with the data connection. Merchant shall make arrangements for
such installation and the maintenance thereof with EPX. EPX shall coordinate the installation
and maintenance of the dedicated data connection. Merchant shall pay EPX for all costs related
to the installation and maintenance of the dedicated data connection.
4. Bank Obligations and Requirements.
4.1. Bank to Provide Services to Merchant. Bank agrees to sponsor Merchant's acceptance of Cards
for Transactions. Bank and EPX, as applicable, agree to provide Merchant with the Services
indicated on Schedule A, as amended from time to time by Bank or EPX, during the term of this
Agreement, subject to the terms and conditions of this Agreement.
4.2. Daily Reconciliation of Transactions.
i. Electronically Transmitted Transactions. Transactions will be settled on a daily basis. Bank shall
deliver payment to Merchant by a credit to the Operating Account equal to the reconciled
summary of Merchant's total summary Transactions since the previous credit. This credit will be
net of following charges:
1. The sum of all Cardholder charges denied, refused or charged back;
2. All refunds processed on account of Cardholders during said time period;
3. All taxes, penalties, charges and other items incurred by Bank or EPX that are reimbursable
pursuant to this Agreement; and
4. All rates, fees and charges in Schedule B.
ii. Provisional Credit. Any credits to the Operating Account are provisional only and subject to
revocation by Bank until such time that the Transaction is final and no longer subject to
chargeback by the Issuer, Cardholder or Associations.
4.3. Merchant Statement. Bank or EPX shall make available a Merchant Statement on a daily and
month -end basis. All information appearing on the Merchant Statement shall be deemed accurate
and affirmed by Merchant unless Merchant objects by written notice specifying the particular
item in dispute within thirty (30) days of the date of the Merchant Statement. Delivery of the
Merchant Statement shall be in electronic form.
4.4. Char eg backs. Bank shall be authorized to charge back to Merchant any Transactions as specified
throughout this Agreement and/or under any of the following circumstances:
1. No specific prior authorization for the Transaction was obtained from the EPX System;
2. The Transaction was based on a pre - authorization form and the Card on which the
Authorization was based has been cancelled and Merchant was so notified prior to the
Transaction;
3. The Card giving rise to the Transaction was cancelled and prior to, or at the time of, the
Transaction, Merchant received notice of the cancellation through the electronic terminal, in
writing or otherwise;
4. The Card expired prior to the date of the Transaction or the date of Transaction was prior to
the validation date, if any, indicated on the Card;
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5. The information required in Paragraphs 9.1 (Documenting Transactions) and 9.2.iii (Card -
Not- Present Transactions) was not submitted to Bank;
6. Bank or Issuer has received a complaint from or on behalf of a Cardholder stating that there
is an unresolved dispute or defense to a charge (whether or not valid) between Merchant and
Cardholder;
7. The Cardholder makes a written complaint to Bank or Issuer that the Cardholder did not
make or authorize the Transaction;
8. A setoff or counterclaim of any kind exists in favor of any Cardholder against Merchant that
may be asserted in defense of an action to enforce payment against the Cardholder in a
Transaction;
9. The Transaction was made at or by a Merchant other than Merchant named in this
Agreement;
10. The Transaction otherwise violates the terms of this Agreement or any other Association or
Issuer bylaw, rule, regulation, policy or guideline;
11. A Transaction is charged back by an Issuer; or
12. Any representation or warranty made by Merchant in connection with the Transaction is
false or inaccurate in any respect.
In any such case, Bank shall not be obligated to accept a Transaction for credit to the Operating
Account. If Bank has credited the Operating Account or Reserve Account for such a Transaction, Bank
may return the Transaction to the Merchant, and Bank shall recover the amount of the Transaction from
either aforementioned account. Merchant agrees that Bank, without prior notice to Merchant, may:
1. Charge the amount of the Transaction to the Operating Account or Reserve Account;
2. Recoup the amount of the Transaction by adjustment of the credits due to Merchant; or
3. Set off the amount of the Transaction against any account or property Bank holds for or on
behalf of Merchant.
5. Compliance.
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5.1. Associations' and Issuers' Requirements. Merchant shall comply with all bylaws, rules,
regulations, policies and guidelines of the Associations and any Issuer whose Cards are used to
process Transactions in accordance with this Agreement. EPX agrees to keep Merchant advised
of Association rules and regulations as they are applied.
5.2. Use of Marks. Merchant will display prominently at its place of business Card emblems and
other promotional material and literature provided by Bank directly or through EPX. Subject to
the prior written consent of Bank and upon such conditions as authorized by Bank, Merchant
may use Card service marks or design marks in its own advertisement and promotional materials.
5.3. Pg�ment Card Industry Security Requirements. Merchant agrees to be compliant with applicable
PCI requirements, in accordance with Payment Card Industry Data Security Standards (PCI) for
protecting Cardholder data as amended by the Associations from time to time.
i. Visa, MasterCard and Discover have implemented a program to ensure the protection of
cardholder data, whether processed, transmitted or stored, through a program of validation and
compliance. Known as PCI, information about the program and specific requirements can be
obtained at www.visa.com/cisp. The program is comprised of 12 major requirements:
1. Install and maintain a firewall configuration to protect data
2. Do not use vendor - supplied defaults for system passwords and other security parameters
3. Protect stored data
4. Encrypt transmission of cardholder data and sensitive information across public
networks
5. Use and regularly update anti -virus software
6. Develop and maintain secure systems and applications
7. Restrict access to data by business need -to -know
8. Assign a unique ID to each person with computer access
9. Restrict physical access to cardholder data
10. Track and monitor all access to network resources and cardholder data
11. Regularly test security systems and processes
12. Maintain a policy that addresses information security
ii. In the event of a security intrusion, Merchant agrees to fully cooperate with a third party approved
Payment Card Industry assessor and/or representative to conduct a thorough security review and
validate compliance with the Payment Card Industry Data Security Standards (PCI) for protecting
Cardholder data;
iii. Merchant is responsible for security of Cardholder data in possession;
iv. Bank, EPX, Merchant and each payment card brand have ownership of Cardholder data and may
use such data ONLY for assisting these parties in the completion of Transactions, supporting a
loyalty program, providing fraud control services, or for other uses specifically required by law;
V. In the event this Agreement is terminated by any of the parties, each party agrees to continue
to treat account holder data as confidential;
vi. Immediately notify Visa USA Risk Management, through its acquirer, of the use of a
Merchant Servicer; and
vii. Ensure the Merchant Servicer implements and maintains all of the security requirements, as
specified in the PCI program.
viii. Merchant must ensure PCI compliance of any residual data which may exist. Any residual
data which is destroyed must be disposed of in a secure manner.
5.4. Use of EPX Systems. Use of software programs approved by EPX and related equipment
installed or improved by EPX for use with the EPX System, will be subject to the following:
i. Merchant will use and operate the EPX Systems only in accordance with Manuals, as amended
from time to time by EPX;
ii. If Merchant is using EPX - provided software, Merchant will install, use and operate the Software
only in accordance with the Manuals, as amended from time to time by EPX;
iii. In processing Transactions, Merchant shall use only software programs, file formats and
processing methods that have been approved and certified by EPX's Integration staff, and
iv. Merchant shall be responsible for the custody and control of all passwords provided by EPX to
Merchant to access the EPX reporting system.
5.5. Compliance with Applicable Law. Merchant represents and warrants that it has obtained all
necessary regulatory approvals, certificates and licenses to provide any services it intends to offer
and that it is in compliance with the regulations of the Federal Trade Commission and the
Federal Communications Commission and shall comply with all present and future federal, state
and local laws and regulations pertaining to Transactions, including, without limitation, the
Federal Fair Credit Reporting Act, the Federal Truth -in- Lending Act, the Electronic Fund
Transfers Act, the Federal Equal Credit Opportunity Act, as amended, and the Telephone
Disclosure and Dispute Resolution Act, as applicable.
5.6. Web Site Requirements for E- Commerce Merchants. A web site operated by the Merchant
that accepts Card Transactions must contain all of the following information:
i. Complete description of the services offered;
ii. Return merchandise and refund policy; which includes the communication of the return policy
during the order process and the requirement that the cardholder must be allowed to select a
"click to accept" option of other affirmative button to acknowledge the policy;
iii. Terms and conditions must be displayed on the same screen view as the checkout screen used
to present the total purchase amount; or
iv. Within the sequence of web pages the cardholder accesses during the checkout process.
V. Customer service contact including e-mail address or telephone number;
6. Term.
vi. Transaction currency;
vii. Export or legal restrictions;
viii. Delivery policy;
ix. Consumer data privacy policy;
X. The security method offered for transmission of payment data such as Secure Sockets Layer or
3 -D Secure; and
xi. Address of the Merchant outlet's permanent establishment, including the Merchant outlet
country;
1. On the same screen view as the checkout screen used to present the total purchase
amount; or
2. Within the sequence of web pages the Cardholder accesses during the checkout process.
6.1. Term. This Agreement shall become effective when signed by all parties however the term shall
begin upon commencement of processing activity under this Agreement and shall remain in
effect for a term of three (3) years unless sooner terminated in accordance with this Agreement.
Merchant shall have the option to renew this Agreement for two (2) successive terms of one (1)
year each upon written notice to EPX and Bank at least thirty (30) days prior to the end of the
then current term. All existing obligations, warranties, indemnities and agreements with respect
to Transactions entered into before such termination shall remain in full force and effect and
Merchant shall remain liable for all obligations to Cardholders, Bank, and EPX incurred while
this Agreement was in effect.
6.2. Termination of Agreement by Bank or EPX.
A. Bank or EPX may terminate this Agreement upon thirty (30) days prior written notice to
Merchant under any of the below listed circumstances. During this period the Merchant shall have
the opportunity to cure the default.
i. Chargebacks exceed the Association guidelines, or appear to be the result of
fraudulent Transactions as defined by the Association. EPX will provide Merchant with
information defining the Association guidelines;
ii. Breach of this Agreement by Merchant; or
iii. Merchant fails to provide its most recent annual audited financial statements to
Bank or EPX in a timely manner upon request.
B. Bank and/or EPX may terminate this Agreement immediately, in the following
circumstances:
i. In the opinion of Bank or EPX there is a substantial negative change in the
Merchant's business or financial position which reasonably indicates an impending bankruptcy;
ii. Any act of fraud or dishonesty is committed by Merchant, its employees and/or
agents, or Bank or EPX believes in good faith that Merchant, its employees and/or agents have
committed, are committing or are planning to commit any acts of fraud or misrepresentation in
connection with transaction processing;
iii. Any representation or warranty made by Merchant in this Agreement or the
Application for Services herein that is not true and correct, in a material respect;
iv. Merchant fails to maintain sufficient funds in the Operating Account to cover the
amounts due to Bank or EPX herein, after a ten (10) day cure period; or
V. Merchant files a petition under any bankruptcy or insolvency law.
C. Bank or EPX may selectively terminate one or more of Merchant's approved locations
without terminating this entire Agreement.
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D. In the event of termination, all obligations of Merchant incurred or existing under this
Agreement prior to termination shall survive the termination. Merchant's obligations with respect to
any Transaction shall be deemed incurred and existing on the transaction date of the card Transaction.
6.3. Termination of Agreement by Bank. If the Bank's management, board of directors or legal
counsel determines that the continued performance by the Bank of its obligations under this
Agreement is not consistent with safe and sound banking practices and if the parties are unable to
agree upon modifications to this Agreement that eliminate the relevant banking concerns or cure
the violation or potential violation of said banking practices, the Bank shall have the right to
terminate this Agreement on not less than ninety (90) days' prior written notice by providing
written notice to Merchant. Any written notice provided to Merchant by the Bank pursuant to
this section shall specify the date on which this Agreement shall terminate, which date shall be
selected by the Bank in an effort to provide to Merchant as much advance notice of such
termination as is reasonably practicable, consistent with safe and sound banking practices.
6.4. Termination of Agreement by Merchant. Merchant may terminate this Agreement upon at least
thirty (30) days prior written notice to the other parties if.
i. Bank or EPX amends Schedule B pursuant to Paragraph 10.14.ii' n (Amendment to Fees and
Charges) to increase the rates, fees or charges Merchant pays herein in excess of 5% in any given
contract year, except for increases in Association fees or rates.;
ii. Any material amendment or modification to this Agreement made by Bank or EPX that adversely
affects Merchant in a material respect (excluding material amendments or modifications required
due to changes in Association Regulations or applicable federal, state or local law or regulation);
or
iii. Bank or EPX breaches a material provision of this Agreement and fails to cure such breach within
such thirty (30) day period. Bank is not obligated to provide replacement Services if EPX does
not or cannot perform.
Merchant's right to terminate pursuant to this Paragraph 6.4.i or 6.4.ii shall expire sixty (60) days
following the receipt of notice to any such increase or material amendment of modification.
Notwithstanding the above, if the EPX Electronic Transaction Processing Agreement, which is being
executed by and between the City of Gilroy and Phoenix Payments Systems, Inc. (dba Electronic
Payment Exchange ( "EPX ")) concurrently with this Agreement, is terminated for any reason by any
party, then Merchant may immediately terminate this Agreement by giving written notice to EPX and
to Bank.
7. Merchant Billing.
7.1. Fees. Merchant shall pay all fees, including, but not limited to monthly service fees, Chargebacks
and set -up fees as specified on and in accordance with Schedule B. In addition to Schedule B
fees, Merchant shall be charged a $50.00 NSF fee when EPX attempts to debit Merchant
for any Chargebacks, returns, fines, fees and assessments and such charges are returned
to EPX for insufficient funds. Bank and EPX shall provide the Merchant with reasonable
notification of all fee or rate changes, including any Association fee or rate changes. Merchant
also agrees to pay Bank or EPX the amount of any fees, charges or penalties assessed against
Bank or EPX by any Association or Issuer for Merchant's violation of the by -laws, rules,
regulations, guidelines, policy statements or threshold requirements of such parties.
7.2. Taxes. Each party hereto shall report its income and pay its own taxes to any applicable
jurisdiction. If excise, sale or use taxes are imposed on the Transactions, Merchant shall be
responsible for the collection and payment thereof. If Bank or EPX funds any taxes, interest,
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fine or penalties that are the responsibility of the Merchant, Bank or EPX shall be immediately
charged to the Operating Account or Reserve Account or recouped by adjustment of any credits
due to Merchant.
7.3. Billing. All amounts Merchant owes Bank and EPX may be charged to the Operating Account or
Reserve Account or recouped by adjustment of any credits due to Merchant.
8. Liability and Indemnification.
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8.1. Conversion. Bank will have no liability to Merchant if any conversion is delayed or cannot be
completed. EPX will not have liability to Merchant if any conversion is delayed or cannot be
completed unless due to the negligence of EPX;
8.2. EPX System. EPX will have no liability to Merchant if the EPX System or Software fails to
operate because of-
i. Merchant's inappropriate, inadequate or faulty computer hardware;
ii. The failure of Merchant, its employees or agents to operate the EPX System or Software properly
in accordance with the instructions provided by EPX; or
iii. The neglect or misuse of the EPX System or Software by Merchant, its employees or agents.
8.3. Limitation of Liability. Neither Bank nor EPX shall be liable to Merchant or Merchant's
customers or any other person for any of the following:
i. Any loss or liability resulting from the denial of credit to any person or Merchant's retention of
any Card or any attempt to do so;
ii. Any loss caused by a Transaction downgrade resulting from defective or faulty software
regardless if owned by Bank, EPX or Merchant; or
iii. Interruption or termination of any Services caused by any reason except for the gross negligence
of EPX; and in such case, any liability shall be solely that of EPX and the liability of EPX shall
be limited to a full or partial waiver of terminal or Software fees due under this Agreement.
8.4. Limitation on Damaizes. In no case shall Merchant be entitled to recover damages from EPX or
Bank which exceed the fees retained by Bank and EPX pursuant to this Agreement during the
one (1) month period immediately prior to the event giving rise to the claim for damages.
8.5. Indemnification. Merchant agrees to indemnify and hold Bank and EPX harmless from any and
all losses, claims, damages, liabilities and expenses, including attorneys' fees and costs arising
out of any of the following:
i. Merchant's failure to comply with this Agreement;
ii. Any recklessness, willful misconduct or negligent act or omission of Merchant;
iii. Merchant's failure to comply with the Manuals;
iv. Merchant's failure to comply with any bylaw, rule, regulation, guideline or policy of any
Association or Issuer;
V. Merchant's failure to comply with any applicable law, rule or regulation;
vi. Any Cardholder dispute concerning the quality, condition or delivery of any Merchant
merchandise or the quality of performance of any Merchant service;
vii. The fraud or dishonesty of Merchant or Merchant's employees, licensees, successors, agents
and/or assigns;
viii. Merchant's selection of an Internet service provider or other telecommunication services provider;
ix. The theft of, misuse of, damage to or destruction of any Software; or
X. Card- Not - Present Transactions, unauthorized Transactions or prohibited Transactions.
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Bank and EPX agree to defend through counsel approved by Merchant (which approval shall not be
unreasonably withheld), indemnify and hold harmless Merchant, its officers, representatives, agents
and employees, against any and all suits, damages, costs, fees, claims, demands, causes of action,
losses, liabilities and expenses, including without limitation attorneys' fees, to the extent arising or
resulting directly or indirectly from the negligence, recklessness or willful misconduct of Bank or EPX,
including their respective assistants, employees or agents.
NEITHER BANK NOR EPX SHALL BE LIABLE FOR ANY PUNITIVE, INDIRECT, SPECIAL
OR CONSEQUENTIAL DAMAGES TO MERCHANT OR TO ANY THIRD PARTY IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE SERVICES
TO BE PERFORMED BY BANK OR EPX PURSUANT TO THIS AGREEMENT.
MERCHANT ACKNOWLEDGES THAT NEITHER BANK NOR EPX HAS PROVIDED ANY
WARRANTIES, EXPRESS OR IMPLIED, WRITTEN OR ORAL, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
PURPOSE, WITH RESPECT TO ANY SOFTWARE INSTALLED OR PROVIDED BY EPX.
BANK HAS NO LIABILITY WITH RESPECT TO ANY SOFTWARE. NEITHER BANK NOR
EPX MAKES ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED,
REGARDING THE SERVICES IT PROVIDES HEREIN. SHOULD THERE BE ERRORS,
OMISSIONS, INTERRUPTIONS OR DELAYS RESULTING FROM BANK'S OR EPX'S
PERFORMANCE OR FAILURE TO PERFORM OF ANY KIND, BANK'S AND EPX'S
LIABILITY SHALL BE LIMITED TO CORRECTING SUCH ERRORS IF COMMERCIALLY
REASONABLE OR REIMBURSING MERCHANT FOR ANY DIRECT DAMAGES INCURRED
BY MERCHANT.
9. Collection and Use of Transaction Information.
qi 9 I yg�
9.1. Documenting Transactions. Merchant or EPX on its behalf shall submit the following
information to Bank in connection with Transaction processing:
i. The DBA name of Merchant, name of Merchant and Merchant's address;
ii. Merchant customer service telephone number;
iii. Merchant Internet address;
iv. Merchant Number assigned by Bank;
V. The Card account number, validation date and/or expiration date of the Card, if one appears on
the Card;
vi. Name, address and telephone number of Cardholder; and
vii. Such additional information as may be required by Bank, EPX and/or the Associations, from time
to time.
Merchant or EPX on its behalf shall not submit a Transaction to Bank (electronically or otherwise)
until Merchant has performed its obligations to the Cardholder in connection with the Transaction or
obtained Cardholder's consent for a Pre - Authorized Recurring Order Transaction. Merchant must not
initiate a Transaction to Bank that Merchant knows or should have known to be fraudulent or not
authorized by the Cardholder. Merchant is responsible for its employees' actions. Merchant may
transmit a Transaction which effects a prepayment of services or full prepayment of custom - ordered
merchandise, manufactured to a Cardholder's specifications, if Merchant advises Cardholder of the
immediate billing at the time of the Transaction and within time limits established by the Associations.
9.2. Authorization for Transactions. Merchant or EPX on Merchant's behalf shall obtain
Authorization of Transactions as follows:
i. Electronically Transmitted Transaction. Merchant or EPX on its behalf shall submit each
Transaction for Authorization to the EPX System. The EPX System shall respond with the
I 1 e 11 of 20
Issuer's authorize or decline to a Transaction transmitted for Authorization and shall capture and
process for Merchant the information relating to the Transaction.
ii. Card- Present Transactions. The following additional requirement applies to Card- Present
Transactions: If a terminal or software application is inoperable at the time of an Authorization
request, the Transaction may be manually authorized. In that case, the Transaction shall be
entered as a Forced Sale, provided the approval number is also entered, and Merchant shall be
subject to an additional IVR authorization fee as outlined in Schedule B.
iii. Card- Not - Present Transactions. The following additional requirements apply to Card- Not - Present
Transactions:
1. All Card- Not - Present Transactions are at Merchant's risk. As to each, Card- Not - Present
Transactions Merchant warrants to Bank that the person whose name is submitted to Bank
as Cardholder either made or authorized another to make the purchase. Upon breach of this
warranty, Bank may charge back the Transaction to Merchant. If Bank charges back the
Transaction to Merchant, Merchant shall pay Bank the amount of the Transaction, any
Chargeback fee in Schedule B, plus any Association fine or assessment. Bank may charge
the Transaction to the Operating Account or Reserve Account without prior notice to
Merchant;
2. All Card- Not - Present Transactions must be electronically authorized and, in addition to the
information required in Paragraph 9.1 (Documenting Transactions), also shall indicate: an
authorization code, if required; customer address and address verification; and in lieu of
Cardholder's signature, a notation of (a) mail order, (b) telephone order, (c) e- commerce
order, or (d) pre- authorized order, on the signature line;
3. If Merchant accepts a Pre - Authorized Recurring Order Transaction, the Cardholder shall
execute and deliver to Merchant a written request for this pre - authorization. This written
request shall be maintained by Merchant and made available upon request to Bank. All
annual billings must be reaffirmed at least once a year. Merchant shall not deliver goods or
perform services covered by a Pre - Authorized Recurring Order Transaction after receiving
notification from the Cardholder that the pre- authorization is cancelled or from Bank that
the Card covering the Pre - Authorized Recurring Order Transaction is not to be honored;
and
4. Merchant shall verify Cardholder's address from the Association network. For telephone or
mail order sales, Merchant shall transmit a ticket /invoice number and shall perform Address
Verification and only accept as approved those Transactions receiving at least a partial
match or system unavailable response.
9.3. Prohibited Transactions. Merchant shall not do any of the following with respect to any
Transaction:
i. Impose a surcharge on a Cardholder who elects to use a Card in lieu of payment by cash, check or
other mode of payment;
ii. Charge a Cardholder more than the amount the Cardholder would pay if payment were made by
cash or check;
iii. Establish a minimum or maximum dollar Transaction amount;
iv. Obtain multiple authorizations for amounts less than the total credit sale amount;
V. Obtain authorization for purposes of setting aside Cardholder's credit line for use in future sales;
vi. Make any special charge to or extract any special agreement or security from any Cardholder in
connection with any Transaction;
vii. Initiate or accept for payment any Transaction which was not originated directly between
Merchant and a Cardholder for the sale or lease of goods or the performance of services of the
type indicated in Merchant's application for card processing services initially submitted to and
approved by Bank;
viii. Honor or accept a Card as payment for any legal services or expenses arising out of or related to
(1) the defense of any crime other than a traffic violation; (2) any domestic relations matter where
such services or expenses are furnished to a person whose name is not embossed on a Card; or (3)
l� I
I i 11,6 ,11,
11Ail° 12 of ��:
any bankruptcy, insolvency, compromise, composition or other process affecting Cardholder's
creditors;
ix. Use Merchant's own Card, or one to which Merchant has access, to initiate a Transaction for the
purpose of obtaining credit for Merchant's own benefit;
X. Redeposit a previously charged Transaction, regardless of whether Cardholder consents;
xi. Initiate a Transaction credit without a balance in the Operating Account equal to the credit;
xii. Use the EPX System or Software and any data received thereon for any other purpose except for
determining whether or not Merchant should accept Cards in connection with a current sale or
lease of goods or services;
xiii. Use the EPX System or Software and data received thereon for credit inquiry purposes or any
other purpose not authorized by this Agreement;
xiv. Draw or convey any inference concerning a person's credit worthiness, credit standing, credit
capacity, character, general reputation, personal characteristics or mode of living when any
Card is processed as non - accepted;
xv. Disclose any information obtained through the EPX System or Software to any person except
for necessary disclosures to affected Cardholders, Bank, EPX and/or the Issuer;
xvi. Add any tax to Transactions unless applicable law expressly requires that Merchant collect
such a tax. Any tax, if allowed, must be included in the Transaction amount and not collected
separately;
xvii. Disburse funds in the form of traveler's checks, if the sole purpose is to allow the Cardholder
to make a cash purchase of goods or services from Merchant;
xviii. Disburse funds in the form of cash, except:
1. In the case of a cashback Transaction and in such case the cashback portion of the
Transaction is the only portion disbursed as cash; or
2. Merchant is dispensing funds in the form of traveler's checks, Visa TravelMoney Cards
or foreign currency. In this case, the Transaction amount is limited to the value of said
form of dispensation plus any fee or commission charged to the Merchant.
xix. Accept a Card to collect or refinance an existing debt;
xx. Initiate a Transaction credit for return goods or services acquired in a cash transaction;
xxi. Make any cash refund to a Cardholder who has made a purchase with a Card. All Transaction
credits will be issued to the same Card account number as the sale;
xxii. Require a Cardholder to complete a postcard or similar device that includes the Card's
account number, Card expiration date, signature or any other Card account data in plain view
when mailed; or
xxiii. Accept Visa Card or Visa Electron Card for the purchase of scrip.
9.4. Disclosure and Storage of Transaction Information.
i. Neither Merchant nor EPX may disclose a Card account number, personal information, or
other Transaction information to third parties other than to Merchant Servicers, the Bank, or
EPX for the sole purpose of:
1. Assisting the Merchant in completing the transaction; or
2. As specifically required by law.
3. Merchant may only disclose Transaction information to approved third parties for the
sole purpose of-
a. Supporting a loyalty program; or
b. Providing fraud control services.
ii. Merchant or EPX:
1. Must store any material containing Card account numbers or imprints (such as transaction
receipts, car rental agreements and carbons) in an area limited to selected personnel and:
2. Render all data unreadable prior to discarding;
3. Must not retain or store full contents of any track on the magnetic stripe subsequent to a
Transaction;
4. Must not retain or store CVV data subsequent to Authorization of a Transaction;
1, = I l E 20
5. Must not request the CVV data on any paper form.
iii. The sale or disclosure of databases containing cardholder account numbers, personal
information, or other Card transaction information to third parties is prohibited.
9.5. Use and Disclosure of BIN Information. A Merchant that receives BIN information from
Bank or EPX must not use such information for any reason other than to identify Visa debit
category products at the point of sale, unless authorized by Visa.
10. General Provisions.
10.1. Confidentiality. Merchant shall treat all information received in connection with this Agreement
as confidential. Merchant shall prevent the disclosure of this information except for necessary
disclosures to affected Cardholders, to Bank, to EPX and to Issuers.
10.2. Independent Contractor. In the performance of its duties herein, each party shall be an
independent contractor, not an employee or agent of another party.
10.3. Cooperation. In their dealings with one another, each party agrees to act reasonably and in good
faith and to fully cooperate with each other in order to facilitate and accomplish the matters
contemplated by this Agreement.
10.4. Entire Agreement. This Agreement, together with the Schedules attached hereto, supersedes any
other agreement, whether written or oral, that may have been made or entered into by any party
(or by any officer or officers of any party) relating to the matters covered herein and constitutes
the entire agreement of the parties hereto, except for the EPX Electronic Transaction Processing
Agreement, which is being executed concurrently herewith.
10.5. Assi ment. This Agreement may not be assigned by any party without the prior written consent
of the other parties, which such consent shall not be unreasonable withheld.
10.6. Captions. Captions in this Agreement are for convenience of reference only and are not to be
considered as defining or limiting in any way the scope or intent of the provisions of this
Agreement.
10.7. Financial Accommodations. Bank, EPX and Merchant intend this Agreement to be construed as
a contract to extend financial accommodations for the benefit of Merchant.
10.8. Venue. Unless otherwise agreed to by all parties in writing, any dispute arising out of and/or in
the course of the relationship established by this Agreement, or by the Agreement itself, shall be
decided in and according to the State where the defendant is physically located, and, the parties
hereby submit to said jurisdiction and venue.
10.9. Setoff. In addition to any other legal or equitable remedy available to it in accordance with this
Agreement or by law, Bank and/or EPX may set off any amounts due to Bank and/or EPX under
this Agreement against any property of Merchant in the possession or control of Bank or EPX.
10.10. No Waiver. Any delay, waiver or omission by a party to exercise any right or power arising from
any breach or default of the other party in any of the terms, provisions or covenants of this
Agreement shall not be construed to be a waiver of any subsequent breach or default of the same
or any other terms, provisions or covenants on the part of the other party. All remedies afforded
by this Agreement for a breach hereof shall be cumulative.
i
10. 11. Waiver. To the extent that Merchant becomes a debtor under any chapter of title 11 of the United
States Code and such event does not result in the termination of this Agreement, Merchant
hereby unconditionally and absolutely waives any right or ability that Merchant may otherwise
have had to oppose, defend against or otherwise challenge any motion filed by Bank or EPX for
relief from the automatic stay of 11 U.S.C. § 362(a) to enforce any of Bank's or EPX's rights or
claims under this Agreement.
10.12. Force Majeure. The parties shall be excused from performing any of their respective obligations
under this Agreement which are prevented or delayed by any occurrence not within their
respective control including but not limited to strikes or other labor matters, destruction of or
damage to any building, natural disasters, accidents, riots or any regulation, rule, law, ordinance
or order of any federal, state or local government authority.
10.13. Severability. If any provisions of this Agreement shall be held, or deemed to be, or shall, in fact,
be, inoperative or unenforceable as applied in any particular situation, such circumstance shall
not have the effect of rendering any other provision or provisions herein contained invalid,
inoperative or unenforceable to any extent whatsoever. The invalidity of any one or more
phrases, sentences, clauses or paragraphs herein contained shall not affect the remaining portions
of this Agreement or any part hereof.
10.14. Amendments to this Agreement. From time to time Bank and/or EPX may amend this
Agreement as follows:
i. Amendment to Cards and/or Services. Bank and/or EPX may amend or delete Cards or Services
listed in Schedule A by notifying Merchant in writing of any amendment with a minimum of
thirty (30) days prior written notice if reasonably practicable. All provisions of this Agreement
shall apply to Cards or Services added to this Agreement. Bank or EPX shall notify Merchant of
the fees to be charged for processing the additional Cards and Services. Acceptance by Merchant
of a new approved Card as payment for a Transaction or use of a new Service after Bank or EPX
has sent Merchant notice of an amendment shall constitute Merchant's agreement to the
amendment and the fees or charges related to these additions.
ii. Amendment to Fees and Charges. From time to time, Bank and/or EPX may change all non -pass
through rates, fees and charges set forth in Schedule B. Bank or EPX will provide written notice
to Merchant of all amendments with a minimum of ninety (90) days prior written notice. Notice
may not be given on the Merchant Statement. All non -pass through rates, fees and charges will
become effective on the third month following the month in which said written notice is given
unless Merchant terminates this Agreement in accordance with Paragraph 6.4 ( "Termination of
Agreement by Merchant ").
10.15. Notices. Except for notices provided by Bank to Merchant on the Merchant Statement, all
notices, requests, demands or other instruments which may or are required to be given by any
party herein shall be in writing and each shall be deemed to have been properly given
i. When served personally on an officer of the party to whom such notice is to be given;
ii. Upon expiration of a period of three (3) Business Days from and after the date of mailing thereof
when mailed postage prepaid by registered or certified mail, requesting return receipt; or
iii. Upon delivery by a nationally recognized overnight delivery service, addressed as follows:
If to Bank: If to EPX:
r
The Bancorp Bank
405 Silverside Rd.
Suite 105
Wilmington, DE 19809
If to Merchant:
City of Gilroy
Finance Department
7351 Rosanna Street
Gilroy, CA 95020
Electronic Payment Exchange
1201 N. Market Street
Suite 701
Wilmington, DE 19801
Any party may change the address to which subsequent notices are to be sent by notice to the
others given as aforementioned.
By signing below, the parties agree to the terms of this Agreement. If Merchant is a
corporation, its proper corporate officers sign. This Agreement may be signed in one or more
counterparts and all signed agreements shall be considered as one.
Agreed to and accepted on: AN uy+ 28 201?
M����
The Bancorp Bank
By: Dated: I 12--
or
Authoriz Representative
Authorized Representative
electronic payment exchange
Electronic Payment Exchange
By:
Au orized Repr ntative
Title.
Merchant
City of Gilroy
Dated: Y ��-
By: Dated:
City 'A mi istrator
Attest: All h'
Shaw reels, Cit
Approved As To Form:
Lindar allon, City Attorney
SCHEDULE A
CARDS SERVICES AND EQUIPMENT /SOFTWARE
1. Cards Available to Merchant.
1.1. Bank and EPX currently provides Card services from the following card issuers: Visa, MasterCard
and Discover transaction processing services. EPX also provides authorization services for
American Express, Diners Club and JCB.
2. Services Available to Merchant.
2.1. As of the date of this Agreement, Merchant has requested use of the following services:
i. Authorization services for Visa, MasterCard, American Express, Diners Club, JCB and
Discover Card
ii. Transaction processing services for Visa, MasterCard and Discover
iii. Cardholder Address Verification
iv. PINless Debit
V. PINbased Debit
2.2. The services provided by the EPX System will be available to Merchant 24 hours a day, 7 days a
week. Every effort will be made to keep the system operational except for normal maintenance,
which will normally occur during off peak hours. The telephone number of the IVR is 866 -660-
7065.
3. Access Methods.
3.1. EPX shall provide the following access method(s) to Merchant:
i.
BuyerWall
ii.
HTTPS Post
iii.
SSL Streamed Socket
iv.
Batch File via SFTP
V.
Dial -up
vi.
IVR
y. > 20
SCHEDULE B
RATES, FEES AND CHARGES
Credit Card Processing
§1
Visa / MasterCard / Discover, Authorization
$0.25
AMEX / Diners Club / JCB, Authorizations
$0.25
Voice Authorization
$0.45
Visa / MasterCard / Discover Settlement
$0.00
Retrieval Request
$4.50
Visa / MasterCard / Discover Chargeback
$15.00
Visa Dues / Assessments & Fees
Pass Through
MasterCard Dues / Assessments & Fees
Pass Through
Discover Dues / Assessments & Fees
Pass Through
Visa / MasterCard / Discover Interchange (Utility Discount Rate)
Pass Through
Network Fees
Pass Through
Visa / MasterCard / Discover Setup Fee
$0.00
EPX Gateway Fees Per Transaction
$0.00
EPX Discount
0.00%
Miscellaneous Fees
Monthly Account Maintenance Fee (Per merchant ID) $15.00
BANK DISCLOSURE PAGE
Sponsoring Member The Bancorp Ban
Member Bank Information Agent Information
The Bancorp Bank Phoenix Payment Systems, dba EPX
409 Silverside Road 1201 N. Market Street
Suite 105 Suite 701
Wilmington, DE 19809 Wilmington, DE 19801
302 - 385 -5000 302- 288 -0600
Important Bank Responsibilities
1. The Bancorp Bank is the only entity approved to extend acceptance of VISA products directly to a Merchant.
2. The Bancorp Bank must be a principal (signor) to the Merchant Agreement.
3. The Bancorp Bank is responsible for educating Merchants on pertinent VISA Operating Regulations with
which Merchants must comply.
4. The Bancorp Bank is responsible for and must provide settlement funds to the Merchant.
5. The Bancorp Bank is responsible for all funds held in reserve that are derived from settlement.
Merchant Information
Merchant Name: City of Gilroy
Merchant Address: 7351 Rosanna Street
Merchant Phone: 408.846.0420
Important Merchant Responsibilities
1. Ensure compliance with cardholder data security and storage requirements.
2. Maintain fraud and chargebacks below thresholds.
3. Review and understand the terms of the Merchant Agreement.
4. Comply with VISA, MasterCard and Discover Operating Regulations.
The responsibilities listed above do not supersede terms of the Merchant Agreement and are provided to ensure
therchant understands some important obligations of each party and that the VISA Member —The Bancorp
R nk is the ultimate authority should the Merchant have any problems.
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Merchant's Printed Name & T
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