Balance Services Agreement
Last updated: December 9th, 2021
Thank you for choosing Balance.
This Balance Services Agreement (“Agreement”) is a contract between Balance Payments, Inc., a Delaware corporation with its principal office at 2261 Market Street #4149 San Francisco, CA 9411 (“Balance”) and the entity described in the signed document (“Proposal Letter”) that links to and incorporates this Agreement (“Merchant”).
This Agreement is composed of a main body and service-specific exhibits. Capitalised terms are defined inline, in Section 13, or in an exhibit. Each of Balance and Merchant is a Party, and Balance and Merchant are, collectively, the Parties.
OVERVIEW OF THE ROLES OF BALANCE AND MERCHANT
Balance has developed a software solution for merchants and their customers. Functionality provided by the solution includes payment services, that enable merchants to receive payments from their business customers, and factoring of receivables, that enable merchants to sell certain receivables owed by their business customers. Balance further allows Merchants, in their capacity as Marketplace Providers, to facilitate the provision of the Payment Processing Services and sale of receivables to Marketplace Vendors, as well as other Marketplace related services.
Merchant wishes to access and use Balance’s software solution, for its own purposes and in order to provide an improved experience to its Customers.
Merchant may contact Balance to query anything in this Agreement. Merchant’s access to and use of Balance’s software solution must at all times be in compliance with this Agreement.
1. SERVICES AND BALANCE PLATFORM.
1.1 Balance Platform. Balance offers an online platform (the “Balance Platform”) which provides access to the Services (as defined below). Subject to completion of Balance’s onboarding processes, Merchant and its Customers may access and use the Services via the Balance Platform in accordance with this Agreement and the Balance Documentation. Each Customer wishing to use the Services and Balance Platform must first agree to the applicable terms and conditions, as determined by Balance. Balance may withhold, suspend or terminate the ability of a Customer to access or utilize the Services or Balance Platform, or any related features, functionality or services, at any time in its sole discretion.
1.2 Services. The services offered by Balance (“Services”) comprise:
(a) the Payment Processing Services, as further described in Exhibit A;
(b) the ability for Merchant to offer extended payment terms to its Customers via Merchant’s sale, and Balance’s purchase, of Receivables, as further described in Exhibit B;
(c) the Balance Marketplace Services, as further described in Exhibit C; and
(d) such other services as Balance may offer from time to time.
1.3 Balance Dashboard and Balance API. Balance will provide Merchant with access to a dashboard (the “Balance Dashboard”) and application programming interfaces (the “Balance API”) from which Merchant may access and provide information related to the Services.
1.4 Modifications. Balance may modify the Services and Balance Platform from time to time at Balance’s sole discretion for any purpose deemed appropriate by Balance.
2. MERCHANT RESPONSIBILITIES.
2.1 Compliant Use. Merchant must:
(a) comply with the Balance Documentation;
(b) immediately and fully cooperate with Balance to investigate any suspected illegal, fraudulent, or improper activity on the part of the Merchant, a Customer, or any other third party;
(c) inform Balance at least 30 days’ prior to any material change to the Merchant’s business (including any change of Control), business model or the goods and/or services it sells;
(d) comply with Applicable Law, and not use any portion of the Services or Balance Platform for any illegal or illicit transaction or activity, including under the laws and regulations applicable to any Customer, or use the Services or Balance Platform for any fraudulent, unlawful, deceptive, or abusive purposes, or in any manner harmful to, or intended to harm, Balance or any third party;
(e) not circumvent Balance’ intended limitations for any feature of the Services or Balance Platform or in a manner inconsistent with the Balance’ published documentation; and
(f) cooperate with Balance in connection with the performance of the Services by making available such personnel and information as may be reasonably required and taking such other actions as Balance may reasonably request.
2.2 Merchant Bank Account. Merchant must maintain the Merchant Bank Account throughout the term of this Agreement and for such period as may be required in order to comply with the provisions of this Agreement. Merchant will notify Balance in writing in advance of any change to the Merchant Bank Account (other than general administrative changes) which it or a third party (including the relevant bank) wishes to make.
3. FEES AND TAXES; AMOUNTS OWED.
3.1 Fees. Merchant must pay to Balance the fees specified in the Proposal Letter. Balance may invoice Merchant for incurred fees, or deduct incurred fees from funds held by Balance. Any fees paid in advance are non-refundable.
3.2 Taxes. Merchant is solely responsible for determining and calculating any and all taxes and duties, including sales, use, transfer, value added, withholding, income, and other taxes and/or duties (“Taxes”) assessed, incurred, or required to be collected, paid, or withheld in connection with amounts received by Merchant in connection with the Services, and for collecting, withholding, reporting, and remitting correct Taxes to the appropriate tax authority. Merchant is solely responsible for the accuracy of the calculated Taxes charged to each Customer.
3.3 Amounts Owed. Balance may recover amounts owed by Merchant under this Agreement by deducting such amounts from funds held by Balance, by requesting that Merchant promptly provide such amounts to Balance, or by debiting the Merchant Bank Account.
4. MERCHANT ACCOUNT BALANCE; PAYOUTS.
4.1 Merchant Account Balance. Merchant may be entitled to receive funds in connection with the receipt of Payments (as defined in Exhibit A); Purchased Receivables (as defined in Exhibit B); and (c) the provision of Marketplace Services (as defined in Exhibit C). Merchant’s entitlement to funds will be reflected as a balance (“Merchant Account Balance”) that may be viewed via the Balance Dashboard or Balance API. This Merchant Account Balance may increase to reflect credits from Payments, sale of Purchased Receivables and Marketplace Services fees, and may decrease by amounts due to Balance (or that Balance is entitled to withhold under this Agreement) and owed by Merchant to third parties. The Merchant Account Balance is not a bank account, and Merchant does not own any funds held by Balance unless or until such funds are credited to the Merchant Bank Account.
4.2 Payouts. Merchant may initiate, via the Balance Dashboard or Balance API, a transfer of its Merchant Account Balance to the Merchant Bank Account, provided that a Payout may be initiated immediately after the Payout Eligibility Date (defined below) for each category of Payout.
4.3 In this Section 4, “Payout Eligibility Date” means:
(a) for a Payment - the date on which Balance receives the funds with respect to a Payment;
(b) for a Purchased Receivable - the date on which the Purchase Price for the Purchased Receivable is credited to Merchant’s Balance Account; and
(c) for fees due to Merchant with respect to Marketplace Services provided to Marketplace Vendors - the date on which the fee is credited to Merchant’s Balance Account.
5.2 Merchant Data. Balance may, prior to onboarding Merchant to a Service, require Merchant to provide Balance with information about Merchant (“Merchant Data”). Balance may from time to time require Merchant to provide updated or supplemental Merchant Data, and Merchant must comply promptly with any such request.
5.3 Provided Data. If Merchant receives any information from Balance related to any Customer’s use of any portion of the Services (such information, “Provided Data”), Merchant acknowledges and agrees that it will not store, use, disclose, or permit any third party to access such Provided Data other than as expressly authorized in advance in writing by Balance.
5.4 Accuracy and Completeness. Merchant will at all times ensure that all data furnished to Balance in connection with this Agreement, including all Customer Data and Merchant Data, is complete and accurate in all respects.
6.1 Protection of Customer Data. Each Party will use commercially reasonable security measures to protect Customer Data in its possession against unauthorised disclosure or use.
6.2 System Security. Each Party is responsible for maintaining, protecting, and securing its software and hardware, including anti-virus software, security patches, and firewalls.
6.3 Merchant Access Control. Merchant must establish a password or other procedures for verifying that only designated employees of Merchant have access to any administrative functions related to the Services, and will be responsible for all use of the Services by Merchant’s personnel or through the use of any credentials or user account assigned to Merchant with or without Merchant’s knowledge or consent. Merchant will comply with all policies and procedures related to the Services which may be established by Balance and communicated to Merchant from time to time.
7.1 Confidential Information. Each Party acknowledges that it may receive Confidential Information of the other Party.
7.2 Ownership of Confidential Information. As between the Parties, each Party’s Confidential Information will remain the property of that Party. Nothing contained in this Agreement shall be construed as obligating any Party to disclose its Confidential Information to any other Party, or as granting to or conferring on a Party, expressly or impliedly, any rights or licence to the Confidential Information of any other Party, and any such obligation or grant shall only be as provided by other provisions of this Agreement.
7.3 Use and Disclosure of Confidential Information.
(a) Each Recipient will hold and maintain in confidence the Confidential Information of the Discloser and will use and disclose such Confidential Information only for the purpose of performing its obligations or exercising or enforcing its rights with respect to this Agreement or as otherwise expressly permitted by this Agreement.
(b) Each Recipient may disclose Confidential Information to the extent such Confidential Information is required to be disclosed by Applicable Law, including in the course of an examination by a regulatory authority with supervisory and examination authority over such Party; provided (i) that, except in connection with disclosure in the ordinary course of an examination by any such regulatory authority, the Party subject to such Applicable Law shall notify the Discloser of any such use or requirement prior to disclosure of any Confidential Information obtained from the Discloser in order to afford the Discloser an opportunity to seek a protective order to prevent or limit disclosure of the Confidential Information to third parties, and (ii) that the Party subject to such Applicable Law shall disclose Confidential Information of the Discloser only to the extent required by such Applicable Law.
(c) Each Recipient shall (i) limit access to the Discloser’s Confidential Information to those employees, authorized agents, vendors, consultants, service Merchants and subcontractors who have a reasonable need to access such Confidential Information in connection with this Agreement, and (ii) ensure that any Person with access to the Discloser’s Confidential Information is bound to maintain the confidentiality of Confidential Information in a manner consistent with the obligations of this Section 6.
(d) In the event that a Recipient becomes aware of any unauthorized use or disclosure of Confidential Information of the Discloser, the Recipient must inform the Disclosure of this event within a reasonable time of becoming aware, any in any event within the time period required by Applicable Law.
7.4 Survival. For clarity, this Section 6 survives termination or expiration of this Agreement.
8. INTELLECTUAL PROPERTY RIGHTS.
8.1 Ownership. Subject to the terms and conditions of this Agreement, as between the Parties, each Party and the Party’s Affiliates will exclusively retain all rights, title, and interests in and to Technology, and Intellectual Property Rights in Technology, that is conceived, developed, reduced to practice, created, or acquired (collectively, “Created”) by or on behalf of such Party or its Affiliate, whether Created prior to or after the start of the Term (as defined below). Nothing contained in this Agreement shall be construed as constituting a transfer or an assignment by one Party to the other Party of any Technology or Intellectual Property Rights, and except as expressly granted under this Agreement or otherwise agreed to in writing by the Parties, neither Party grants the other Party any right, license, or covenant not to sue with respect to any Technology or Intellectual Property Rights. There are no implied licenses granted under this Agreement.
8.2 Technology. Subject to the terms and conditions of this Agreement, each Party on behalf of itself and its Affiliates grants to the other Party and its Affiliates a limited non-exclusive, royalty-free, fully paid up, non-assignable, non-sub-licensable, non-transferable (other than in accordance with Section 13.2), worldwide right and license to use, any items of Technology that the other Party provides or otherwise makes accessible to the other Party in connection with the Services, solely to the extent necessary for the other Party to exercise, perform and comply with its rights and obligations under this Agreement in connection with the Services and solely during the Term. This license shall be further subject to any additional terms and restrictions as agreed by the Parties prior to or contemporaneous with the delivery of such Technology. For the avoidance of doubt, nothing herein shall be construed as obligating either Party to provide specific Technology to the other Party, except as expressly contemplated herein.
8.3 Publicity. Notwithstanding anything to the contrary, Merchant grants Balance the right to disclose the name of Merchant and the existence of the relationship between Merchant and Balance for purposes of marketing and advertising the Balance’s Services.
8.4 Feedback. Merchant may, but is not required to, provide ideas, concepts, comments, or feedback to Balance regarding the Services (“Feedback”). Except to the extent that the Parties have agreed in writing to a different set of rights in advance of the disclosure of such Feedback, Merchant grants to Balance an irrevocable, perpetual, royalty-free right to use, disclose and otherwise exploit any Feedback, and the Intellectual Property Rights embodied therein for any purpose.
8.5 No Joint Intellectual Property Rights. The Parties shall not be obligated to jointly develop any Technology in connection with this Agreement and shall use best efforts not to do so. If the Parties, in their sole discretion, determine to jointly develop any Technology, the Parties shall first enter into a separate and binding written agreement confirming the scope of such joint development efforts and the respective rights of the Parties in any jointly developed Technology, including ownership of the Intellectual Property Rights in any such jointly developed Technology including any ideas, technology, designs, know-how, methods or processes jointly developed.
9. REPRESENTATIONS AND WARRANTIES.
9.1 Merchant Representations and Warranties. Merchant represents and warrants to Balance that:
(a) This Agreement is valid, binding, and enforceable against Merchant in accordance with its terms.
(b) Merchant is a validly existing corporation, in good standing and is authorized to conduct business in each state in which the nature of Merchant’s activities makes such authorization necessary.
(c) Merchant has the full power and authority to execute and deliver this Agreement and to perform all its obligations under this Agreement. The provisions of this Agreement and the performance by the Merchant of its obligations under this Agreement are not in conflict with Merchant’s charter, bylaws or any other organizational document, agreement, contract, lease or obligation to which Merchant is a party or by which it is bound.
(d) As of the start of the Term (as defined below), there are no pending or, to the knowledge of Merchant, threatened, claims or litigation against Merchant that would adversely impact Merchant’s ability to perform its obligations under this Agreement.
9.2 Balance Representations and Warranties. Balance represents and warrants to Merchant that:
(a) This Agreement is valid, binding, and enforceable against Balance in accordance with its terms.
(b) Balance is a validly existing corporation, in good standing and is authorized to conduct business in each state in which the nature of Balance’s activities makes such authorization necessary.
(c) Balance has the full power and authority to execute and deliver this Agreement and to perform all its obligations under this Agreement. The provisions of this Agreement and the performance by Balance of its obligations under this Agreement are not in conflict with Balance’s charter, bylaws or any other organizational document, agreement, contract, lease or obligation to which Balance is a party or by which it is bound.
(d) As of the start of the Term (as defined below), there are no pending or, to the knowledge of Balance, threatened, claims or litigation against Balance that would adversely impact Balance’s ability to perform its obligations under this Agreement.
10.1 Indemnification. Each Party (the “Indemnifying Party”) agrees to indemnify, defend and hold harmless the other Party and their respective Affiliates, sureties, officers, directors, agents, employees, parents and subsidiaries (each, an “Indemnified Party”), from and against any and all liability, damages, costs, or expenses, including reasonable legal fees and expenses, for any third party claim or demand (“Claim”) arising out of or related to:
(a) the Indemnifying Party’s breach of any representation, warranty, covenant or obligation under this Agreement;
(b) gross negligence, fraud or willful misconduct on the part of the Indemnifying Party or any of its officers, directors, employees, representatives or service providers, or any of their respective officers, directors and employees;
(c) any actions taken by an Indemnified Party in accordance with or in good faith reliance upon information or instructions provided by the Indemnifying Party or any of its agents or representatives;
(d) obligations owed to any Customer or other third party by the Indemnifying Party, or any third party retained by the Indemnifying Party; and
(e) any actual or alleged infringement or misappropriation of any Intellectual Property Rights of any third party by the Indemnifying Party.
The defense obligation of the Indemnifying Party attaches if the Claim alleges any of the foregoing violations, breaches, acts or omissions.
10.2 Indemnification Procedures. If any Claim is asserted against an Indemnified Party by any person who is not a party to this Agreement in respect of which the Indemnified Party may be entitled to indemnification under the provisions of Section 9.1 above, written notice of such Claim shall promptly be given to the Indemnifying Party. The Indemnifying Party shall have the right, by notifying the Indemnified Party within ten (10) Business Days of its receipt of the notice of the Claim, to assume the entire control (subject to the right of the Indemnified Party to participate at the Indemnified Party’s expense and with counsel of the Indemnified Party’s choice) of the defense, compromise or settlement of the matter, including, at the Indemnifying Party’s expense, employment of counsel of the Indemnifying Party’s choice. The Indemnified Party must provide reasonable cooperation in the defense. The Indemnifying Party shall not compromise or settle a Claim against the Indemnified Party without the Indemnified Party’s prior written consent, which shall not be unreasonably withheld or delayed; provided that the Indemnifying Party may, however, effect a compromise or settlement of any action without the Indemnified Party’s consent if the following conditions are met: (a) there is no admission of guilt or liability by the Indemnified Party; and (b) the sole relief provided is monetary damages that are paid in full by the Indemnifying Party.
11. LIMITATION OF LIABILITY; DISCLAIMER OF WARRANTIES.
11.1 LIMITATION OF LIABILITY. IN NO EVENT WILL EITHER PARTY (OR ANY OF ITS AGENTS, AFFILIATES, LICENSORS OR SUPPLIERS) BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, PUNITIVE, INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES, OR COST OF PROCUREMENT OF SUBSTITUTE GOODS, SERVICES OR TECHNOLOGY, ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE USE OF THE SERVICES OR ANYTHING PROVIDED IN CONNECTION WITH THIS AGREEMENT, THE DELAY OR INABILITY TO USE THE SERVICES OR ANYTHING PROVIDED IN CONNECTION WITH THIS AGREEMENT OR OTHERWISE ARISING FROM THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS OR LOST SALES, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR OTHERWISE, EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF DAMAGES. EXCLUDING CLAIMS UNDER SECTION 6 (OTHER THAN CLAIMS RELATED TO CUSTOMER DATA) AND SECTION 9.1(E), AND AMOUNTS PAYABLE BY MERCHANT PURSUANT TO SECTION 5, THE TOTAL LIABILITY OF EITHER PARTY TO THE OTHER PARTY, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE OR STRICT LIABILITY), OR OTHERWISE, WILL NOT EXCEED THE FEES PAID OR PAYABLE TO BALANCE HEREUNDER IN THE TWELVE-MONTH PERIOD ENDING ON THE DATE THAT A CLAIM OR DEMAND IS FIRST ASSERTED. THE FOREGOING LIMITATIONS WILL APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
11.2 DISCLAIMER OF WARRANTIES. THE SERVICES ARE PROVIDED “AS-IS,” WITHOUT WARRANTIES OF ANY KIND. BALANCE (AND ITS AGENTS, AFFILIATES AND SUPPLIERS) HEREBY DISCLAIM ALL OTHER WARRANTIES, EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, RELATING TO OR ARISING OUT OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT.
12. TERM AND TERMINATION.
12.1 Term. This term of this Agreement is set forth in the Proposal Letter (the “Initial Term”), and automatically be extended for successive “Renewal Terms” of one (1) year unless a Party notifies the other Party of its intent not to renew at least thirty (30) days prior to the end of the Initial Term or a Renewal Term, in each case unless terminated earlier. The Initial Term and all Renewal Terms are called the “Term”. Following expiration of the Initial Term, Balance may modify the fees, by providing at least 30 days’ advance notice to Merchant.
12.2 Termination and Suspension.
(a) Merchant may terminate these Terms upon thirty (30) days’ written notice to Balance for Balance’s material breach that remains uncured at the end of such notice period. Balance may suspend the Services immediately if Merchant breaches any of the terms or conditions of this Agreement, or may terminate this Agreement upon thirty (30) days’ written notice to Merchant for Merchant’s material breach that remains uncured at the end of such notice period, provided that, in the event that Merchant fails to pay any amounts due under this Agreement, Balance may suspend or terminate this Agreement upon ten (10) days’ written notice to Merchant. Upon expiration or termination of this Agreement, Merchant’s right to use the Services will immediately cease.
(b) In addition to any other termination rights provided elsewhere in this Agreement, either Party may terminate the Agreement upon occurrence of one or more of the following events:
(i) Either Party: (A) voluntarily commences any proceeding or filing any petition seeking relief under Title 11 of the United States Code or any other federal, state or foreign bankruptcy, insolvency, liquidation or similar law; (B) applies for or consents to the appointment of a receiver, trustee, custodian, sequestrator or similar official for such Party or for a substantial part of its property or assets, (C) makes a general assignment for the benefit of creditors, or (D) takes corporate action for the purpose of effecting any of the foregoing;
(ii) The commencement of an involuntary proceeding or the filing of an involuntary proceeding or the filing of an involuntary petition in a court or competent jurisdiction seeking: (A) relief in respect for any other Party, or of a substantial part of its property or assets under Title 11 of the United States Code or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law, (B) the appointment of a receiver, trustee, custodian, sequestrator or similar office for the other Party for a substantial part of its property or assets, or (C) the winding up or liquidation, of the other Party, if such proceeding or petition shall continue un–dismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall continue unstayed and in effect for sixty (60) days;
(iii) Upon any change to or enactment of any Applicable Law, or publication by any regulatory authority, which would have a material adverse effect upon: (A) the Services; (B) such Party’s ability to perform its obligations under this Agreement; provided that the Parties, after good faith discussions, cannot find a mutually agreeable solution within a reasonable amount of time;
(iv) Violation of Applicable Law relating to the performance of this Agreement rendering either of the Parties unable to substantially perform this Agreement, provided that the Parties cannot find a legally workable solution to avoid violating Applicable Law within a reasonable amount of time; or
(v) Upon direction from any regulatory authority for either Party to cease or materially limit performance of such Party’s obligations under this Agreement.
12.3 Rights and Obligations upon Termination. The Parties’ rights to terminate this Agreement will be in addition to, and not in lieu of, any other remedies they may have by virtue of (a) a breach or default with respect to this Agreement or (b) any other event which permits a termination. Furthermore, the termination or expiration of this Agreement will not relieve a Party of its respective obligations due at or before the time of such termination or expiration or prejudice any claim of either Party. For the avoidance of doubt, termination or expiration of this Agreement will not affect Merchant’s obligation to pay fees owed to Balance under this Agreement, including those incurred during any notice period prior to termination.
13.1 Notices. Except as otherwise expressly provided, all notices to be given to a Party are effective only when made in writing and actually delivered to such Party’s physical or email address for notices. For Balance, the physical notice address is stated at the top of this Agreement, and email notices may be sent to firstname.lastname@example.org. For Merchant, the notice addresses are set out in the Proposal Letter. A Party may modify its notice address by providing notice of this change to the other Party.
13.2 Assignment. Merchant may not assign this Agreement to any third party without the prior written consent of Balance. Any purported assignment contrary to this section shall be void.
13.3 Entire Agreement. Each Party agrees that this Agreement, including all schedules and exhibits, and all referenced documents, is the complete and exclusive statement of the mutual understanding of the Parties, and supersedes and cancels all previous written and oral agreements, communications and other understandings, relating to the subject matter of this Agreement. Each Party acknowledges that it is not relying on any information, conditions, covenants, warranties or representations provided to it or to any of its Affiliates or representatives at any time except as expressly stated in this Agreement.
13.4 Survival, Severability and Waiver. All provisions of this Agreement which by their nature are meant to extend beyond the expiration or termination of this Agreement. If any provision of this Agreement is found to be unenforceable or invalid, that provision will be limited or eliminated to the minimum extent necessary so that the remaining provisions of this Agreement will otherwise remain in full force and effect and enforceable. The failure by either Party to insist upon strict performance of any of the provisions contained in this Agreement will in no way constitute a waiver of its rights as set forth in this Agreement, at law or in equity, or a waiver of any other provisions or subsequent default by the other Party in the performance of or compliance with any of the terms and conditions set forth in this Agreement.
13.5 Force Majeure. Balance is not responsible for any breach or delay in the performance of its obligations pursuant to this Agreement for reason of fire, flood, riot, act of terrorism, strike, labor conflict, freight embargo, delay in shipping, fortuitous event, act of a public enemy, of war, of civil disorder, of interruption, of a failure or an interruption of the Internet, phone service, or any other interconnection service or of electronic or mechanical equipment, of any law, of any rule or of any regulation, current or future, or of any act on the part of a government that would delay or prevent the performance of its obligations pursuant to this Agreement, or for any other cause reasonably beyond the control of Balance.
13.6 Relationship of Parties. Each Party agrees that, except as with respect to Balance acting as the authorized agent of Merchant, they are independent contractors to each other in performing their respective obligations under this Agreement. Nothing in this Agreement or in the working relationship being established between the Parties will be deemed or is intended to be deemed, nor will it cause, any of the Parties to be treated as partners, joint ventures, or otherwise as joint associates for profit. Merchant does not have any authority of any kind to bind Balance in any respect whatsoever.
13.7 No Third-Party Beneficiaries. Except as stated in this Agreement, this Agreement does not create any right or cause of action in or on behalf of any person or entity other than the Parties.
13.8 Responsibility for Own Costs. Except as otherwise expressly stated, as between the Parties, each Party will be responsible for its own costs and expenses in connection with the performance of its obligations and the provision and receipt of the Services.
13.9 Dispute Resolution. This Agreement will be governed by, construed and enforced in accordance with the laws of the State of New York, without regard to that state’s conflict of laws principles. Jurisdiction and venue for the formal resolution of any disputes relating to this Agreement will lie exclusively in the Federal and State Courts located in New York, New York. THE PARTIES AGREE TO WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN THE RESOLUTION OF ANY DISPUTE OR CLAIM BETWEEN THE PARTIES OR ANY OF THEIR RESPECTIVE AFFILIATES WHICH MAY ARISE UNDER THIS AGREEMENT. Each Party agrees that service of process in any action or proceeding hereunder may be made upon such Party by certified mail, return receipt requested, to the address for notice set forth herein. In any action or proceeding between the Parties to enforce rights under this Agreement, the prevailing Party will be entitled to recover costs and attorneys’ fees from the other Party.
13.10 Construction. The headings contained in this Agreement are inserted for convenience only and shall not affect the meaning or interpretation of this Agreement. The singular includes the plural, and the plural includes the singular. The terms “include” and “including” are not limiting. Reference to any agreement or other contract includes any permitted modifications, supplements, amendments, and replacements. Any reference to a URL will be deemed to mean that URL as may be updated from time to time.
13.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which will be an original but all of which taken together will constitute one and the same Agreement.
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly Controls, is Controlled by, or is under common Control with such Person.
“Applicable Law” means any and all applicable laws, treaties, conventions, directives, regulations, ordinances, and judicial decisions in courts and tribunals of competent jurisdiction that relate to the Services or a Party, including any subsequent amendments, modifications and revisions.
“Balance Account” means an account established for a user on the Balance Platform.
“Balance Documentation” means the documentation located at http://docs.getbalance.com.
“Business Day” means any day other than a Saturday, Sunday or a day on which banks in the State of New York are not open for business.
“Confidential Information” means this Agreement, including any schedule, exhibit, attachment or amendment; any Customer Data, and all proprietary information, data, trade secrets, business information, financial data and budgetary or proprietary business information, income or sales data or projections, customer lists, business operations, policies, procedures and techniques, advertising summary or tracking reports or other reports generated in accordance with this Agreement, schematics, ideas, techniques, know how, concepts, development tools and processes, computer printouts, computer programs, design drawings and manuals, and improvements, patents, copyrights, trade secrets or other intellectual property of any kind or nature, plans for future development and new product or service concepts, contemplated products or services, research, development, and strategies which a Discloser discloses, in writing, orally or visually, to a Recipient or to which Recipient obtains access in connection with the negotiation or performance of this Agreement. Confidential Information shall not include information that: (a) is already rightfully known to the Recipient at the time it obtains Confidential Information from the Discloser; (b) is or becomes generally available to the public other than as a result of disclosure in breach of this Agreement or any other confidentiality obligations; (c) is lawfully received on a non-confidential basis from a third party authorized to disclose such information without restriction and without breach of this Agreement; or (d) is developed by a Party without the use of any proprietary, non-public information provided by the other Party.
“Control” means, with respect to any Person, the possession, direct or indirect, of the power to vote fifty-one percent (51%) or more of the securities that have ordinary voting power for the election of directors of such Person, or to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or by contract or otherwise.
“Customer” means a business customer of Merchant.
“Discloser” means a Party disclosing its Confidential Information.
“Intellectual Property Rights” means all past, present, and future rights, title and interests of the following types, which may exist or be created under the laws of any jurisdiction in the world: (a) rights associated with works of authorship, including exclusive exploitation rights, copyrights, moral rights, publicity and privacy rights, and mask works; (b) trademarks, and trade name rights and similar rights, service marks, domain names, trade dress, logos, and other distinctive brand features, whether or not registered; (c) trade secret rights; (d) patents and industrial property rights; (e) publicity and privacy rights in marketing, advertising, or other public facing materials (including rights to use the name, likeness, image of persons); and (f) rights in or relating to registrations, renewals, extensions, combinations, divisions, and reissues of, and applications for, any of the rights referred to in clauses (a) through (d) above.
“Marks” means, with respect to a Party, the trademarks, service marks (whether registered or at common law), trade names, business names, logos, internet domain names or other proprietary designs and designations service marks, including names and other distinctive marks or logos, which identify such Party.
“Merchant Bank Account” an account with a U.S. depository institution held in the name of the Merchant or a third party nominated by the Merchant (and in each case as acceptable to Balance) linked to Merchant’s use of the Balance Platform and Services.
“Person” means any natural or legal person, including any corporation, partnership, limited liability company, trust or unincorporated association or other entity.
“Recipient” means a Party receiving or obtaining access to the other Party’s Confidential Information.
“Technology” means any processes, methods, know-how, designs, information, data, software programs in both source and object codes, application programming interfaces, documentations, specifications, techniques, software development toolkits, products, devices, apparatuses, and other forms of technology, and all Intellectual Property Rights therein but excluding the Marks.
PAYMENT PROCESSING SERVICES
This Exhibit contains the terms and conditions relating to payment processing services. To the extent that there is a conflict between the Agreement and this Exhibit, this Exhibit will prevail.
1. PAYMENT PROCESSING SERVICES.
1.1 Payment Processing Services. Balance will provide functionality within the Balance Platform which enables Customers to make one-time and recurring payments to Merchant (each, a “Payment”) through Merchant’s use of the payment processing services provided by Payment Processor (defined below), as further described in this Exhibit and the Balance Documentation (such services, the “Payment Processing Services”).
2. KEY CONCEPTS.
2.1 Payment Processor. Balance will designate one or more third parties (each, a “Payment Processor”) to process payments for Merchant that are initiated through the Balance Platform. See Section 5 for the Payment Processors designated as at the start of the Term.
2.2 Operating Regulations. Merchant’s use of the Payment Processing Services is subject to the the by-laws, operating regulations, terms and conditions, rules, guidelines, policies and procedures of any card association or payment network used to process any Payment, or applicable to any payment method used to make any Payment, through the Payment Processing Services, as any or all of the foregoing may be amended and in effect from time to time (collectively, “Operating Regulations”).
2.3 Connected Account. Merchant authorizes and directs Balance to (i) on behalf of Merchant, create an account with Payment Processor for and in the name of Merchant for the purpose of allowing Payment Processor to accept, process and settle Payments for Merchant and otherwise provide the Payment Processing Services to Merchant (such account, the “Connected Account”), (ii) manage the Connected Account on behalf of Merchant in the manner described herein or as otherwise mutually agreed upon by the Parties from time to time, and (iii) take such other action on behalf of Merchant as may be required in connection the Connected Account and Payment Processing Services.
3. APPOINTMENT AS AGENT.
3.1 Merchant appoints Balance as Merchant’s authorized agent for the purposes of providing the Payment Processing Services and performing any additional duties as set forth in this Agreement, and Balance accepts such appointment. Merchant agrees that upon Balance’s receipt of any amounts payable to Merchant, (a) such amount will be deemed received by Merchant and treated in the same manner as any funds paid directly to Merchant, such that Merchant will be responsible for fulfilling its obligations to the payor of such amount in the same manner as if Merchant had received such amount directly, whether or not such amount is subsequently remitted to Merchant or a designated third party, and (b) Merchant will not, to the extent such amount constitutes funds paid by or on behalf of a Customer, have recourse against the Customer in the event such amount is not subsequently made available to Merchant, or transferred in accordance with Merchant’s instructions, and instead Merchant and Balance with work together, and, as applicable, with Bank, in good faith to resolve any such issue.
3.2 In accepting such appointment as the authorized agent of Merchant, Balance assumes no liability for any acts or omissions of any Merchant or any third party. Merchant will cooperate with Balance and execute all commercially reasonable documents which may be necessary to implement this Section 3.
4. MERCHANT’S USE OF THE PAYMENT PROCESSING SERVICES.
(a) agrees to promptly provide Balance with complete and accurate information regarding Merchant, Merchant’s business and the Merchant Bank Account as and to the extent Balance may request from time to time, and authorizes and directs Balance to share with Payment Processor such information and transaction information related to Merchant’s use of the Payment Processing Services as may be requested by Payment Processor from time to time;
(c) authorizes (i) Balance to provide information regarding the Merchant Bank Account, or other deposit account designated by Merchant, as applicable, to Payment Processor, (ii) Payment Processor to initiate ACH credit and debit entries to the Merchant Bank Account, or other deposit account designated by Merchant, as applicable, for the purpose of crediting Payment settlement amounts and other amounts due to Merchant and debiting amounts owed by Merchant, including fees, chargebacks, refunds, fines or penalties, in each case in connection with the use of the Payment Processing Services, such authorization to include the right to effectuate net settlement, at Balance’s discretion, unless otherwise agreed by the Parties, and (iii) Balance to, in the event that Payment Processor remits to the Merchant Bank Account, or other deposit account designated by Merchant, as applicable, any amount in settlement of a Payment which exceeds the net amount Merchant is to receive after deduction of any related fees and other charges payable by Merchant, initiate an ACH debit to the Merchant Bank Account or other deposit account designated by Merchant, as applicable, the excess amount to Balance;
(d) authorizes Balance to, on behalf of Merchant, (i) accept and collect Payment information and instructions from Customers through the Balance Platform and (ii) transmit such information and instructions to Payment Processor to allow Payment Processor to submit the related Payments for authorization, processing and settlement;
(e) agrees that (i) Merchant is the merchant of record and assumes all of the responsibilities of a merchant under the Operating Regulations with respect to each Payment processed through the Payment Processing Services, (ii) as between Merchant and Balance, Merchant is responsible and liable for all charges, including fees, chargebacks, refunds, fines or penalties, arising in connection with Merchant’s use of the Payment Processing Services, and (iii) in the event Balance pays any such amount to Payment Processor or other third party on behalf of Merchant, Merchant will, upon notice from Balance of such payment, promptly remit payment of such amount to Balance in the manner designated by Balance;
(f) acknowledges and agrees that (i) Merchant must have and implement a clear and fair return and refund policy with its Customers; (ii) Payment Processor reserves the right to suspend or terminate provision of the Payment Processing Services to Merchant at any time in the event that Merchant’s activities violate the Payment Processor Account Agreement (defined below), this Agreement, the policies or procedures of Payment Processor or Balance, the Operating Regulations or Applicable Law, or otherwise reflect negatively on the brand or reputation of Balance, Payment Processor, or any financial institution utilized by Payment Processor in connection with its provision of the Payment Processing Services, in each case as determined by Payment Processor or Balance in their sole discretion; and (iii) in the event that Payment Processor suspends or terminates its provision of the Payment Processing Services to Merchant, Balance may immediately suspend its provision of all or a portion of the Services or terminate this Agreement upon notice to Merchant;
(g) agrees that (i) Merchant will be liable for any losses incurred by Balance or Payment Processor as a result of any unauthorized, fraudulent, improper or erroneous use of the Payment Processing Services, Services or Balance Platform by any Customer, Merchant, or any of Merchant’s employees, agents, representatives or contractors and (ii) Balance shall have no liability or obligation whatsoever in connection with any act or omission of Payment Processor;
(h) acknowledges that (i) Balance shall address Customer inquiries and disputes regarding the Payment Processing Services that are made directly to Balance, and agrees to assist Balance in providing such customer support to Customers, including providing Balance with any information deemed necessary by Balance to resolve any such Customer inquiries or disputes and (ii) Merchant shall at all times be responsible for Customer inquiries and disputes related to the goods and/or services offered by Merchant and/or sold to Customers; and
(i) acknowledges and agrees that Balance may amend this Agreement as necessary to comply with Applicable Law, the Operating Regulations, or any requirement of Payment Processor, in each case upon Balance’s notice of such amendment to Merchant.
5. DESIGNATED PAYMENT PROCESSORS.
5.1 Designated Payment Processors. The Parties acknowledge and agree that Stripe, Inc. (“Stripe”) will serve as a Payment Processor.
5.2 Change of Payment Processors. Balance may add or remove third parties as designated Payment Processor, at any time and in its sole discretion, in which case Balance will inform Merchant of such change. If Balance adds a new designated Payment Processor, Merchant will execute such documents and take such other action, as may be reasonably required by Balance or the relevant third party designated by Balance to serve as Payment Processor, in order for such party to serve as Payment Processor and provide the Payment Processing Services to Merchant.
5.3 Payment Processor Terms - Stripe.
(a) Merchant acknowledges and agrees that (i) Stripe’s provision of the Payment Processing Services to Merchant is subject to the Stripe Payment Processor Account Agreement (defined below), and (ii) Merchant has reviewed, agrees to, and shall at all times comply with and be bound by, the Stripe Connected Account Agreement (available at https://stripe.com/us/connect-account/legal), which includes the Stripe Services Agreement (available at https://stripe.com/us/legal), as the same may be amended by Payment Processor from time to time (collectively, the “Stripe Payment Processor Account Agreement”).
(b) Merchant represents, warrants and covenants to Balance that (i) Merchant is not engaged, and will not at any time engage, in any businesses, activities or practices which are illegal or otherwise included on Stripe’s Restricted Businesses List, available at https://stripe.com/restricted-businesses, as the same may be updated or modified by Stripe from time to time (“Stripe Restricted Businesses List”), and (ii) will not at any time utilize the Payment Processing Services in any way which violates the Stripe Payment Processor Account Agreement.
PURCHASE OF RECEIVABLES
This Exhibit contains the terms and conditions relating to the sale and purchase of certain receivables owed by Merchant’s business customers. To the extent that there is a conflict between the Agreement and this Exhibit, this Exhibit will prevail.
1. Additional Definitions.
1.1 “Purchased Receivable Limit” means the maximum amount of a specific Customers’ Receivables that Balance may purchase from Merchant that can be outstanding at any one time, as set forth in Section 2(2)(i) below.
1.2 “Debtor Relief Laws” means (i) the Bankruptcy Code and (ii) all other applicable liquidation, conservatorship, bankruptcy, moratorium, arrangement, receivership, insolvency, reorganization, suspension of payments, adjustment of debt, marshaling of assets or similar debtor relief laws of the United States, any state or any foreign country, from time to time, in effect affecting the rights of creditors generally.
1.3 “Discount” means, with respect to a Receivable, the amount by which Balance decides, in its sole discretion and based on its own calculations or determination, to reduce from the face amount of the Receivable.
1.4 “Final Adjudication Date” means, with respect to any Receivable, the date on which an Invoice is first issued for such Receivable.
1.5 “Invoice” means a bill evidencing a Receivable.
1.6 “Proceeding” means any suit in equity, action at law or other judicial or administrative proceeding.
1.7 “Purchase Price” means, with respect to a Receivable, an amount equal to the full amount of such Receivable minus an amount equal to the applicable Discount.
1.8 “Purchased Receivable” means a Qualified Receivable that Balance has purchased from Merchant.
1.9 “Receivable” means an amount owed to Merchant by relevant Customer for services that have been fully rendered or products that have been delivered to Customer by Merchant or a third party acting on behalf of Merchant.
1.10 “Qualified Receivable” means a Receivable which satisfies the criteria set forth in Section 4.1 of Exhibit B.
2. Merchant Receivables.
2.1 Merchant agrees that Balance shall have a right of first refusal with respect to any Receivable such that Merchant shall not sell any Receivable to any Person other than Balance without first providing Balance the opportunity to purchase such Receivable with a minimum of five business days notice. Notwithstanding anything to the foregoing, Balance, in its sole and absolute discretion, shall determine whether a Receivable is purchased and Balance shall at no time be liable to Merchant for Balance’s failure or refusal to purchase a Receivable.
2.2 The purchase and sale of a Receivable shall generally occur as follows:
(i) Balance will establish a Purchased Receivables Limit for a relevant Customer. To allow Balance to compute this Purchased Receivables Limit, Merchant agrees to provide Balance with any Merchant or Customer information that Balance may request in order to evaluate the extent to which Merchant can participate in the program. While Balance will generally not change the Purchased Receivables Limit for 90 days after it is determined, Balance reserves the right to lower itat any time and for any reason. Even if Merchant has not used all of its Purchased Receivables Limit, Balance reserves the right to decline the purchase of a specific Qualified Receivable.
(ii) Merchant may request that Balance purchase a Receivable. Upon Balance’s receipt of such request, Balance will (a) decide whether it wants to purchase a Receivable and, if so, whether it wants to purchase 100 percent of the Qualified Receivable or a lesser percentage, (ii) calculate the Discount for the purchase of a Qualified Receivable from Merchant and (iii) transmit to Merchant the terms of the purchase of such Qualified Receivable, following which Merchant will communicate to Balance its offer to sell the Receivable to Balance based on the applicable Purchase Price (subject to any reductions pursuant to Section 3 below). Balance’s offer shall remain outstanding for a minimum of 1 day. Merchant acknowledges and agrees that Balance may adjust the Discount based on Merchant’s and Merchants’ Customers conduct in prior transactions with Balance.
(iii) If Balance then accepts such offer, Balance and Merchant will complete the sale, assignment and transfer of the relevant Purchased Receivable to Balance as absolute owner, including through Balance’s transfer of funds equal to the Purchase Price (subject to any reductions pursuant to Section 3 below) to Merchant’s Balance Account within 24 hours (subject to any delays Balance may require pursuant to subsection (v) below). After deposit in the Merchant’s Balance Account, the Merchant can elect to transfer the funds to its designated bank account. Each of Merchant and Balance shall, at all times, treat the purchase of Receivables by Balance under this Agreement as a purchase by Balance and a sale by the Merchant for federal, state, and local income tax purposes.
(iv) Following Balance’s purchase of a Purchased Receivable, Merchant shall (i) not be entitled to collect or receive any amount in connection with such Purchased Receivable, (ii) hold the entirety any payment on such Purchased Receivable which may come into Merchant’s possession or control (even if such payment is payable to Merchant) in trust for the benefit of Balance, and promptly deliver to Balance all such payments (and indorse any payment which is payable to Merchant), and (iii) not hinder, delay or interfere with any payment of such Purchased Receivable or any terms thereof. In the event that Merchant receives any inquiries, complaints, correspondence or other communications from any Customer or third party regarding any Purchased Receivable, Merchant will immediately inform Balance of any such Customer inquiry, complaint, correspondence or other communication regarding a Purchased Receivable. Balance reserves the right to instruct Merchant regarding how to respond to the inquiry or to assume control from Merchant for responding to it.
(v) Balance reserves the right to not transfer the Purchase Price of a Purchased Receivable to Merchant until the later of (i) when Merchant completes delivery of the goods or services to the Customer or (ii) the time period for the Customer to reject or return the goods has lapsed.
(vi) Merchant agrees that Balance may increase the Discount if Merchant’s customer pays for goods on terms different from those Merchant had disclosed to Balance.
(b) Notwithstanding Section 2(b), the Parties may automate certain or all aspects of the purchase, transfer, and sale of Receivables through pre-defined programmatic-based rules as can be found in the Balance Documentation and which Balance may change from time to time in its discretion and without notice.
3. Merchant’s Representations and Warranties.
3.1 Qualified Receivables. Merchant warrants, represents, covenants and agrees that, with respect to each Receivable Merchant agrees to sell to Balance:
(a) The goods or services underlying the invoice have been fully delivered or rendered to the relevant Customer unless Balance has expressly waived the delivery requirement in writing with respect to the Purchased Receivable, respectively
(b) such Receivable has not been outstanding for more than sixty (60) days following the Final Adjudication Date, is valid and owing pursuant to Merchant’s contract, terms, or other form of agreement with the relevant Customer, which shall not be modified or amended without Balance’s prior written consent, and the terms and conditions of such Receivable have not been waived, altered, modified or amended in any respect following the Receivable’s origination;
(c) (i) such Receivable is not contingent in any respect for any reason and constitutes the legal, valid, binding and unconditional payment obligation of the respective Customer thereunder, fully enforceable against such Customer for the amount outstanding thereof and subject to no defense, counterclaim, recoupment, discount, adjustment or right of setoff or rescission, except to the extent that enforceability may be limited by Debtor Relief Laws and general principles of equity, (ii) there are no conditions precedent to the enforceability or validity of such Receivable that have not been satisfied or waived, (iii) the Customer owing such Receivable has no bona fide claim against Merchant; (iv) such Receivable is not and will not be subject to dispute between the relevant Customer and Merchant, including with respect to the cost or quality of services rendered or products sold, (v) such Receivable is free of any defense, offset, counterclaim or recoupment that could be asserted by the Customer thereunder or any other Person obligated therefor or by Merchant’s creditors or assignees and (vi) there are no Proceedings existing, pending or, to the knowledge of Merchant, threatened against or affecting Merchant before any regulatory authority, which materially and adversely affects the validity or enforceability of such Receivable.
(d) the transfer of such Receivable from Merchant to Balance pursuant to this Agreement complies with all Applicable Law, and such Receivable has not been originated in, and, as of any date of determination, is not subject to the laws of, any jurisdiction under which the sale, transfer, assignment, setting over, conveyance or pledge of such Receivable would be unlawful, void or voidable;
(e) immediately prior to the sale thereof to Balance, Merchant is the sole owner of such Receivable and has good and marketable title thereto, and has the right to assign, sell and transfer such Receivable to Balance free and clear of any lien, pledge, charge, claim, security interest or other encumbrance, and Merchant has not sold, assigned or otherwise transferred or conveyed any right or interest in or to such Receivable, has not pledged such Purchased Asset as collateral for any debt or other purpose, nor has Merchant authorized the filing of, or aware of the filing of, any financing statements against Merchant that include a description of collateral covering any portion of such Receivable;
(f) Merchant represents and warrants to Balance that, upon purchase by Balance, (i) each Purchased Receivable becomes the sole property of Balance, (ii) Merchant’s sale and assignment of such Purchased Receivables shall pass legal and equitable title thereto to Balance free and clear of liens, claims and encumbrances, and (iii) Balance will have the right to assign, sell, transfer and pledge such Receivable to any person without limitation.
(g) Merchant has not advanced funds, or induced, solicited or knowingly received any advance of funds from a party other than the applicable Customer, directly or indirectly, for the payment of any amount required by the related Receivable,
(h) such Receivable was originated in all material respects in accordance with Applicable Law and continues to be in compliance in all material respects with all Applicable Law, and was not obtained as a result of verifiable identity theft or fraud on the part of the purported Customer;
(i) no consents or approvals are required by the terms of such Receivable or otherwise for the consummation of the sale, transfer or assignment of such Receivable or the rights and duties of the holder thereof, and such Receivable is not subject to any restriction on the ability of the holder thereof to exercise its rights with respect thereto;
(j) such Receivable is not and shall not become subject to a defense or claim in recoupment or setoff that can be asserted against Balance;
(k) payments on such Receivable are payable to the Merchant;
(l) neither such Receivable nor the relevant Customer is subject to or restricted by any receivership, insolvency or bankruptcy proceeding;
(m) Merchant has not received any notice of (i) actual or imminent bankruptcy insolvency or material impairment of the financial condition of the relevant Customer or (ii) actual or threatened litigation regarding the validity or enforceability of such Receivable;
(n) to the knowledge of Merchant, Merchant, on the one hand, and the applicable Customer, on the other hand, are not engaged in any litigation or arbitration whatsoever with respect to each other, and neither has threatened the other in writing with any litigation or arbitration;
(o) the Receivable constitutes an “account”, a “payment intangible” or proceeds thereof and is not an “instrument”, “chattel paper” or “electronic chattel paper” (each such term as defined in the Uniform Commercial Code as in effect, from time to time, in each applicable jurisdiction);
(p) such Receivable shall be reflected on Merchant’s books and records as having been transferred, sold and conveyed to Balance; and
(q) such Receivable is evidenced by an Invoice that (i) is complete and accurate in all respects, and (ii) has been issued to and received by the Customer.
The warranties and representations set forth in this Section 4.1 shall apply as of the date each Receivable is sold hereunder and shall continue with respect to each Purchased Receivable until each such Purchased Receivable is fully paid.
3.2 Other Warranties and Covenants of Merchant. Merchant further warrants, represents, covenants and agrees that as of the Effective Date and at all times during the Term of this Agreement, Merchant is and shall remain (a) able to pay its debts as they become due, and (b) in compliance with all federal, state and local tax laws, rules and regulations. All warranties and representations of Merchant under this Agreement are continuing warranties and representations.
Merchant acknowledges and agree that Balance shall not be liable for any damages to Merchant arising out of any decision Balance makes to purchase, or not, a Qualified Receivable including but not limited to any damages or other liability (including statutory and contingent liability) related to the failure of Balance to complete the purchase of a Qualified Receivable.
5. Merchant’s Required Notice to Balance.
Merchant shall immediately notify Balance of: (a) a dispute related to any Purchased Receivable, (b) any other known breach of warranty or default in Merchant’s covenants and agreements set forth herein in Section 4.1, above, (c) Merchant’s discovery of evidence of insolvency of a Customer whose Receivable is a Purchased Receivable, or (d) the filing and service of a lawsuit or adversary proceeding related to a Purchased Receivable, the the payment related thereto, or involving a dispute between Merchant and its Customer.
6.1 Purchase Price Sharing. Marketplace Provider may choose to co-purchase the Receivable from its Marketplace Vendors, In which case Marketplace Provider agrees to accept the risk the Purchase Price is not received for the Purchased Receivable.
7. Power of Attorney. Merchant makes, constitutes and appoints Balance as Merchant’s true and lawful attorney-in-fact with power of substitution and with power and authority to:
(a) endorse the name of Merchant or of any of its officers or agents upon any notes, checks, drafts, money orders, or other instruments of payment as required to enforce Balance’s rights under this Agreement;
(b) sign and endorse the name of Merchant or any of its agents upon any Invoice, drafts against Customers, assignments, verifications, demands under letters of credit and notices in connection with Purchased Receivables and any instrument or document relating thereto or to Merchant’s rights therein;
(c) execute any agreement compromising and settling any dispute arising out of the Purchased Receivables;
(d) bring suit to collect any Purchased Receivable;
(e) amend the terms of any Purchased Receivable;
(f) execute any financing statements (including amendments) to perfect Balance’s security interest in the Purchased Receivables as granted by this Agreement;
(g) notify any Customer obligated with respect to any Purchased Receivable that the Purchased Receivable has been assigned to Balance by Merchant and that payment thereof is to be made to the order of and directly and solely to Balance; and
(h) communicate directly with Customers to verify the amount and validity of any Purchased Receivable, to collect payment, or to address or resolve a dispute.
Merchant’s attorney-in-fact, Balance, is hereby granted full power to do all necessary things to accomplish the above as fully and effectively as could Merchant. Merchant ratifies all that the attorney-in-fact shall lawfully do or cause to be done by virtue hereof. The power of attorney shall be irrevocable for the Term of this Agreement and until Balance has irrevocably received all payments to which Balance is or may be entitled from Merchant and Customers on Purchased Receivables. Nothing in this Section 8 prohibits Balance from transferring its power of attorney and other rights to Purchased Receivables to a third party.
8. Assignment. Merchant acknowledges and agrees that Balance may assign any and all of its rights under this Agreement with respect to any Receivable purchased by Balance hereunder.
BALANCE MARKETPLACE SERVICES
This Exhibit contains the terms and conditions relating to Merchant’s use of the Balance Marketplace Services, and supplements the Agreement. To the extent that there is a conflict between the Agreement and this Exhibit, this Exhibit will prevail. Nothing in this Exhibit alters the terms and conditions of the Agreement as they apply to use of the Services for Merchant’s own purposes (such as to receive payment for goods or services).
1. ADDITIONAL DEFINITIONS.
1.1 In this Exhibit:
“Actions” means any actions, orders or requests submitted or initiated by Marketplace Provider through the Balance Marketplace Services by or on behalf of a Marketplace Vendor.
“Balance Marketplace Services” means the technology and related services Balance provides to Marketplace Provider to facilitate the provision of payment processing and related services enabling Marketplace Vendors to receive payments from Marketplace Vendor Customers, and the factoring by the Marketplace Vendor Customers of certain receivables owed by such Marketplace Vendor Customers.
“Marketplace” means Marketplace Provider’s online platform or marketplace that enables Marketplace Vendors to offer goods or services on or through its platform or marketplace.
“Marketplace Data” means data and information related to Marketplace Provider, Marketplace Services, Marketplace Vendors, Marketplace Vendor Customers, Actions and/or Payments.
“Marketplace Provider” means Merchant, in its capacity as the provider of a Marketplace and that wishes to facilitate its Marketplace Vendors’ access to the Services.
“Marketplace Services” means the products and services Marketplace Provider provides through its Marketplace.
“Marketplace Vendor” means a user that sells goods or services via the Marketplace.
“Marketplace Vendor Agreement” means Marketplace Provider’s agreement with Marketplace Vendors and other users of its Marketplace related to the offering and provision of the Marketplace Services.
“Marketplace Vendor Customers” means a customer of a Marketplace Vendor.
1.2 Capitalized terms not defined above have the meanings given in the Agreement.
2. BALANCE MARKETPLACE SERVICES.
2.1 Outline of Services. The Balance Marketplace Services enable Marketplace Provider to integrate Balance’s services into its Marketplace, which includes: (a) the ability of Marketplace Provider to facilitate the provision of the Payment Processing Services by Balance to Marketplace Vendors; and (b) the ability for Marketplace Vendors to sell Receivables.
2.2 Balance’s Role. Balance is not responsible to Marketplace Vendors for any Marketplace Services, and Marketplace Provider is solely responsible for providing the Marketplace Services to Marketplace Vendors as set forth in the Marketplace Vendor Agreement.
3. MARKETPLACE MERCHANT ONBOARDING.
3.1 Acceptance Criteria. Balance requires the Marketplace Provider to establish certain criteria for accepting Marketplace Vendors consistent with Balance’s screening processes. Balance has ultimate discretion regarding its underwriting, risk and compliance decisions, including decision of whether to provide Services to any Marketplace Vendors.
3.2 Marketplace Vendor Suspension and Termination. Balance reserves the right to suspend or terminate provision of Services to any Marketplace Vendors at any time if Balance determines that a Marketplace Vendor’s activities either: (a) violate Balance’s policies or the Balance Services Agreement; or (b) otherwise reflects negatively on the brand or reputation of Balance, or any partner of Balance (including card schemes and financial services providers).
3.3 Marketplace Vendor Misconduct. To the extent that Marketplace Provider is aware or later becomes aware of a Marketplace Vendor being engaged in any fraudulent, unlawful, deceptive or abusive activity, Marketplace Provider must notify Balance as soon as practically possible. Following notification Balance will use commercially reasonable efforts to determine whether to terminate or suspend any such account’s access to the Balance Services.
3.4 Onboarding Process. When the Marketplace Provider wishes to onboard a new Marketplace Vendor to allow it to use the Services the following steps shall be followed:
(a) Marketplace Provider can use the Services to create Balance Accounts for the Marketplace Vendors. Marketplace Provider is responsible for ensuring Marketplace Vendor’s information regarding the Marketplace Vendor account is passed to Balance.
(b) Marketplace Provider will have access to Marketplace Vendor’s information and may initiate Actions in accordance with the Marketplace Vendor Agreement. Marketplace is responsible for ensuring the accuracy of any Marketplace Vendor information at all times which it provides as part of this process.
(c) Balance may decline to create a Balance Account for a Marketplace Vendor or limit the functionality available to it until Balance is satisfied that it has received sufficient information about the Marketplace Vendor. Marketplace Provider is responsible for the accuracy and completeness of any information about the Marketplace Vendor provided to Balance as part of the onboarding process.
(d) Prior to creating a Balance Account for a Marketplace Vendor, Marketplace Provider must ensure that the Marketplace Vendor enters as Merchants into the Balance Services Agreement, as made available by Balance to Marketplace Provider.
4.1 Marketplace Fees. Balance will facilitate the collection of applicable fees from the Marketplace Vendors as described in the Proposal Letter.
4.2 Communication of Fees. Marketplace Provider is solely responsible for communicating any fees charged to Marketplace Vendors for their use of Marketplace Services and Marketplace must clearly communicate any such Marketplace fees to Marketplace Vendors prior to imposing such fees.
5. MERCHANT UNDERTAKINGS.
5.1 Marketplace Provider may only engage in Actions for a Marketplace Vendor to the extent that it is doing so on behalf of the Marketplace Vendor in accordance with the authority granted to Marketplace Provider under the Marketplace Vendor Agreement, and solely in accordance with the Agreement, this Exhibit and Applicable Law. Marketplace Provider is responsible for any Actions it initiates.
5.2 Marketplace Provider will include in the Marketplace Vendor Agreement information detailing the Marketplace Services and the Actions that Marketplace Provider may conduct on a Marketplace Vendor’s behalf in order to allow the use of the Balance Marketplace Services through the Marketplace.
5.3 Marketplace Provider is responsible for its relationship with the Marketplace Vendors and Marketplace Vendor Customers, including receipt of all required consents in order to allow the use of the Balance Marketplace Services, and the performance of all Actions, in connection with the Marketplace.
5.4 Marketplace Provider will include all required undertakings, obligations, representations and covenants which are included in the Agreement in the Marketplace Vendor Agreement so as to enable the provision of the Balance Marketplace Services to Marketplace Vendors. Marketplace Provider remains solely and exclusively liable at all times for any deficiencies or omissions in the Marketplace Vendor Agreement which result in the inability to provide the Balance Marketplace Services or which result in any claim by a third party.
5.5 Marketplace Provider will provide Balance with all of the information and materials reasonably required by Balance in order for Balance to provide the Balance Marketplace Services. Failure by Marketplace Provider to provide all such information and materials may result in Balance immediately suspending Marketplace Provider’s access to and use of all or part of the Balance Marketplace Services. Marketplace Provider represents and warrants to Balance that all information it provides to Balance is accurate and complete in all respects.
5.6 Marketplace Provider approves and consents to Balance sharing and otherwise disclosing of all required information received from Marketplace Provider, including about its Marketplace, the Marketplace Services, Marketplace Vendors, Marketplace Vendor Customers and Payments, with any financial institution, Payment Processor, or other third party service provider that Balance may use or rely upon in connection with its provision of the Balance Marketplace Services.
5.7 Marketplace Provider will obtain, and represents and warrants to Balance that it has obtained, all necessary rights and consents under Applicable Law to disclose to Balance and allow Balance to collect, use, retain and disclose, Marketplace Data and any and all information that Marketplace Provider provides to Balance in connection with Marketplace Provider’s use of the Balance Marketplace Services, including information that Balance may collect directly by various means.
5.8 Marketplace Provider will comply at all times with Applicable Law and Operating Regulations in connection with its provision of the Marketplace and Marketplace Services, as well as its use of the Balance Marketplace Services.
BALANCE SERVICES AGREEMENT