DEBTRESOLVE CUSTOMIZED SOLUTION PROGRAM LICENSE AGREEMENT

WHEREAS, DebtResolve provides proprietary internet-based software tools and technology, utilizing a blind bidding system, based upon patented technology licensed to DebtResolve, for the collection of consumer debts to financial institutions, lenders and holders of consumer debt to assist such persons with the collection of such debts (collectively, the “DebtResolve System”); and

WHEREAS, Client is a financial institution, debt collector or other holder of consumer indebtedness, and desires to license the DebtResolve System described on Exhibit A from DebtResolve for purposes of evaluating its effectiveness, in accordance with the terms and conditions as set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

DEFINITIONS. The following are the definition of certain capitalized terms used in this Agreement.

 

“Agreement” means this DebtResolve Customized Solution Program License Agreement.

SUMMARY OF PROGRAM. DebtResolve shall create a series of Web pages, proprietary to and controlled by DebtResolve, using the DebtResolve System described on Exhibit A prominently branded with the Client’s trademarks and logos, which Client shall provide to DebtResolve in a computer-readable format as specified by DebtResolve (such customized version of the DebtResolve System identified on Exhibit A may be referred to herein as the “Customized Solution”). DebtResolve shall be responsible for hosting the Customized Solution. From time to time as agreed by the Parties, Client shall forward to DebtResolve the Debtor Account Information to facilitate use of the Customized Solution. The Debtor Account Information permits an End-User to access the Customized Solution over the Internet and utilize the Customized Solution to attempt to resolve the account with Client. Client will be solely responsible for establishing settlement parameters (amount, terms, etc.) for all accounts and communicating such parameters to DebtResolve in writing. The Customized Solution shall be enabled to accept payments so that the End-User can make payment in full, or the first payment of an agreed upon payment plan, as part of the agreed upon resolution.

 

LICENSE TO CUSTOMIZED SOLUTION. For the duration of the Term, provided that the Client is not in material breach of any term or condition of this Agreement, DebtResolve hereby grants to Client, and Client hereby accepts, subject to the terms and conditions of this Agreement, a non-exclusive, non-transferable and nonassignable license, without the right to sublicense, to use the DebtResolve System, in the form of the Customized Solution, while hosted by DebtResolve, and to permit End-Users to access the Customized Solution through the Internet, for use solely in connection with the collection of consumer debts (the “Licensed Field”) within the United States of America and, to the extent agreed to in writing by the Parties, other specifically identified countries (collectively, the “Licensed Territory”). All software used in connection with the Customized Solution shall be hosted by or at the direction of DebtResolve. Accordingly, no physical media containing the software for the Customized Solution shall be provided to Client. Except for such rights expressly granted to Client herein, no license, right, title or interest in or to the DebtResolve System, the Customized Solution or any other Intellectual Property of DebtResolve is granted to Client or any other person or entity, either expressly or by implication, estoppel or otherwise.

 

6.1 Following the Initial Term (or any extension thereof), the term of this Agreement shall be automatically extended for additional one (1) year periods unless either party provides the other with written notice at least thirty (30) days prior to the end of the then-current term that it does not intend to extend the current term. The Initial Term plus all extensions thereof may be referred to as the “Term.” Notwithstanding anything herein to the contrary, Client shall not provide to DebtResolve, and DebtResolve shall not be required to process, any Debtor Account Information first provided following any notice of an intent not to renew pursuant to this Section 6.1 or a notice to terminate pursuant to Section 6.3.

 

6.2 Following the expiration of the Initial Term, Client may terminate this Agreement without cause upon thirty (30) calendar days' prior written notice to DebtResolve.

 

6.3 Termination. Either Party may terminate this Agreement for Cause. “Cause” is (i) a material breach of this Agreement (including any Exhibit), which remains uncured thirty (30) days after the breaching party is given written notice of the breach; and (ii) the prosecution of any case, proceeding or other action under any existing or future law of any jurisdiction, domestic or foreign relating to bankruptcy, insolvency, reorganization or relief with respect to such party, or seeking reorganization, arrangement, adjustment, winding-up liquidation, dissolution, composition or other relief with respect to such party or such party’s debts; or (iii) the making of an assignment or any other arrangement for the general benefit of creditors under any state statute. The parties agree that DebtResolve would be damaged by the early termination of this Agreement, and the amount of such damage is not reasonably susceptible to estimation. Client agrees to pay, as liquidated damages, and not a penalty, in the event that (A) Client terminates this Agreement without Cause prior to the expiration of the Initial Term or (B) DebtResolve terminates this Agreement for Cause, 85% of all monthly fees paid to DebtResolve by Client on a monthly basis over the last three months, or since service started, whichever is shorter multiplied by the number of months remaining in the natural term of this Agreement or remaining in any extension of the natural term. Further, if this Agreement is terminated by DebtResolve for Cause, the liquidated damages set forth in this Section shall also apply. Immediately upon termination or expiration of the Term, (a) Client agrees to: (i) stop using the Customized Solution and any and all related documentation (not including reports provided to Client hereunder) and to return all such documentation to DebtResolve; (ii) return to DebtResolve any other Intellectual Property or Confidential Information of DebtResolve, and (iii) if so requested, certify in writing that it has complied with the foregoing; and (b) DebtResolve agrees to: (i) stop using the Client Trademarks and Client Copyrightable Materials; (ii) return to Client any other Intellectual Property or Confidential Information of Client, and (iii) if so requested, certify in writing that it has complied with the foregoing. Termination or expiration of this Agreement shall not effect Client’s obligation to make payment of all Fees or other costs related to a period prior to the effective date of such termination or expiration or otherwise in accordance with their terms to the extent any Fee obligation may arise following any such termination or expiration.

 

6.4 Survival of Terms. Terms and conditions which by their nature survive the termination of this Agreement shall survive and continue beyond the term and termination of this Agreement, including, without limitation, Sections 5, 6 and 7 (including Exhibit E).

Program Standard Terms and Conditions; Exhibits. The DebtResolve Program Standard Terms and Conditions, a copy of which is attached hereto as Exhibit E, are incorporated herein by reference and shall have the same force and effect as if such provisions were set forth herein in their entirety. Moreover, all Exhibits referenced in this Agreement are incorporated into this Agreement by reference herein and shall have the same force and effect as if the provisions thereof were explicitly included herein.

 

Notices. Except as otherwise permitted by this Agreement, any notice required by this Agreement will be in writing and sent to the other Party by United States certified mail or by nationally recognized overnight courier service to the addresses of the Parties set forth on the first page of this Agreement or to such other address as a Party may provide in accordance with the provisions of this Section. In addition to the address of Client on page 1 of this Agreement, a copy of all notices shall be sent to Contract Services, xxxxxxxxxxxxxxxxxx. All notices will be deemed given or delivered when actually received.

 

Headings. The titles and headings of the various sections and paragraphs in this Agreement are intended solely for convenience of reference and are not intended for any other purpose whatsoever, or to explain, modify or place any construction upon or on any of the provisions of this Agreement.

 

Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but which collectively will constitute one and the same instrument.

The DebtResolve System is largely comprised of a software product made available over the Internet that permits holders of consumer debts (“Creditors”) to utilize a patented blind bidding system to facilitate the settlement or other type of resolution of such debts with the debtor. The DebtResolve System is designed in such a manner as to enable the debtor to interact directly with the Creditor in connection with the outstanding debt.

The DebtResolve System permits the Creditor administrator access by which Creditor establishes the settlement parameters to be used by the DebtResolve System. Creditor may establish settlement parameters that are a function of both time and amount. For example, for an outstanding balance of $1,000, Creditor could establish settlement parameters that would accept (i) a lump-sum payment of $500, (ii) three monthly payments of $200 for an aggregate payment of $600, or (iii) six monthly payments of $150 for an aggregate payment of $750. The direct administrator access permits the settlement parameters may be modified at any time directly by Creditor without the knowledge or involvement of DebtResolve. DebtResolve will not establish, and shall not be responsible for establishing, settlement parameters for the Creditor.

When a debtor utilizes the DebtResolve System, following compliance by debtor with required security log-in procedures, the debtor will be provided with his or her outstanding balance. At the Creditor’s discretion, the debtor may be provided the opportunity to dispute the outstanding debt and provide Creditor an explanation for the dispute. If the debtor is provided this opportunity and disputes the debt, his or her ability to continue using the DebtResolve System will terminate, and the dispute notice will be transmitted to Creditor. If the debtor does not dispute the debt (or if this option is not provided), the debtor will have an opportunity to make an offer to settle the debt by specifying a payment amount offered by the debtor and selecting from a schedule of payment options established by Creditor by way of the settlement parameters inputted though Creditor’s administrative access. The DebtResolve System will compare the settlement offer against the settlement parameters established by Creditor.

If the debtor’s offer is within Creditor’s settlement parameters, the debtor will receive an immediate reply that the offer was accepted. The debtor will be able to confirm his or her agreement with the settlement and to enter information to permit processing of the payment amount due at that time. Payments are made by debtors directly to Creditor. DebtResolve does not receive payments from any debtor but may provide access to electronic payment gateways.

If the offer is rejected, the debtor will be provided at least two more opportunities to make a better offer. A final opportunity to make an improved offer may be extended after an unsuccessful third round if the third round offer is close to the settlement parameters set by Creditor. Whether an offer is close enough to invite a fourth offer is among the parameters to be set by Creditor. If still unsuccessful after completion of this process, the debtor will have an opportunity to submit any suggestions or other offers directly to Creditor by email. This information is provided directly to Creditor, and no further screens are presented to the debtor until Creditor has contacted the debtor.

For debts which are not subject to settlement, the DebtResolve system may provide the debtor the opportunity to bring the account current, make partial payments or other options to cure the account, as determined by the Creditor.

Trademark. Client hereby grants to DebtResolve for the Term of this Agreement a nonexclusive, royalty-free right and license to use, display and reproduce Client’s name, logo, trademarks and service marks (collectively, the “Client Trademarks”), solely for the purpose of effectuating DebtResolve’s duties and obligations under this Agreement, including, without limitation, use in connection with the Customized Solution. All of Client’s rights in and to the Client Trademarks will remain at all times the sole and exclusive property of Client. DebtResolve shall comply with the standards established by Client and provided to DebtResolve in writing with respect to the form of the Client Trademarks, their usage, and the underlying goods and/or services. All use of the Client Trademarks shall inure to the benefit of Client.

 

Copyright. Client hereby grants to DebtResolve for the Term of this Agreement a nonexclusive, royalty-free right and license to use, display and reproduce all copyrighted and copyrightable materials supplied to DebtResolve by or on behalf of Client, including, without limitation, Client’s web site privacy policy and Terms of Use (such materials, collectively, the “Client Copyrightable Materials”) solely for the purpose of effectuating DebtResolve’s duties and obligations under this Agreement. All of Client’s rights in and to the Client Copyrightable Materials will remain at all times the sole and exclusive property of Client.

 

Mutual Representations and Warranties. Each Party represents and warrants to the other Party that: (i) it is a corporation, limited liability company, or other entity (as set forth on the first page to the Agreement), duly organized, validly existing and in good standing under the laws of its state of organization (as set forth in the introductory paragraph to the Agreement) (ii) it has full power and authority to enter into this Agreement and to consummate the transactions and perform its obligations contemplated hereby; (iii) the execution, delivery and performance by such Party of this Agreement have been duly authorized by all requisite company action; (iv) this Agreement has been duly executed and delivered by such Party and constitutes a valid and binding agreement of it, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally or by general equitable principles; and (v) the execution, delivery and performance of this Agreement by such Party does not constitute or cause a breach of its organizational documents, governing documents, any license or permit, or any other agreement to which it is a party.

 

Disclaimer of Representations and Warranties. TO THE MAXIMUM EXTENT PERMITTED BY LAW, EXCEPT AS SET FORTH IN THIS AGREEMENT, EACH PARTY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY, ORAL OR IN WRITING, ARISING UNDER THE LAWS OF THE UNITED STATES, INCLUDING, WITHOUT LIMITATION, WITH RESPECT TO VALIDITY, ENFORCEABILITY, NON-INTERRUPTION, ERROR-FREE OPERATION, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OR THE LIKE WITH RESPECT TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY AND THE GOODS AND SERVICES TO BE PROVIDED HEREUNDER.

Defense Against Infringement Claims. . Subject to the penultimate sentence of this paragraph, DebtResolve shall defend and hold harmless Client from and against any infringement claims, demands or actions by a third party relating to the use of the Customized Solution in the Licensed Field and Licensed Territory (“Third Party Infringement Claims”). Client agrees to cooperate with DebtResolve with respect to the foregoing. Client shall have no claim of any kind against DebtResolve based on or arising from DebtResolve’s handling of or decisions concerning any such Third Party Infringement Claim, or any settlement or compromise thereof, and Client hereby irrevocably releases DebtResolve from any such claim. DebtResolve shall have no obligation pursuant to this Section 5 in connection with any claim that arises because of (i) any modification or enhancement to the Customized Solution other than by DebtResolve; (ii) specifications required by Client or materials provided by Client that are included in the Customized Solution (including, without limitation, the Customized Solution Database, Terms of Use, Client Trademarks, Client Copyrightable Materials and privacy policy); (iii) use of the Customized Solution in any way other than as intended and permitted by the Agreement, or (iv) Client’s failure to use a work-around or substitute made available by DebtResolve for the Intellectual Property at issue. In the case of any claim arising by reason identified in the immediately preceding subsections (i), (ii), (iii) or (iv), Client will defend, indemnify and hold DebtResolve harmless from any such claims.

a) security and confidentiality of Customer Information;

b) protection against anticipated threats or hazards to the security or integrity of Customer Information; and

c) protection against the unauthorized access or use of Customer Information.

If Recipient is required by a court or governmental agency having proper jurisdiction to disclose any Confidential Information, Recipient must promptly provide the Owner notice of such requirement to enable the Owner to seek an appropriate protective order, provided that such notice is permitted by applicable law.

Recipient may use the Confidential Information only as necessary for Recipient’s performance under or pursuant to rights granted in this Agreement or a Statement of Work and for no other purpose. Recipient’s limited right to use the Confidential Information expires upon expiration or termination of this Agreement. Recipient’s obligations of confidentiality and non-disclosure survive termination or expiration of this Agreement. Upon expiration of Recipient’s limited right to use the Confidential Information, Recipient must return all physical embodiments to Owner or, with Owner’s permission, Recipient may destroy the Confidential Information.

Recipient must develop and maintain appropriate security measures for the proper disposal and destruction of Confidential Information. Upon Expiration of Recipient's limited right to use the Confidential Information, Recipient must return all physical embodiments thereof to Owner or, with Owner's permission, Recipient may destroy the Confidential Information. Recipient shall provide written certification to Owner that Recipient has returned, or destroyed, all such Confidential Information in Recipient's possession. Notwithstanding the foregoing, Recipient may retain one archival copy of Confidential Information, which may be used solely to demonstrate compliance with the provisions of this Section.

If Recipient or any of its representatives or agents breaches the covenants set forth in this Agreement, irreparable injury may result to the Owner or third parties entrusting Confidential Information to the Owner. Therefore, the Owner’s remedies at law may be inadequate and the Owner shall be entitled to seek an injunction to restrain any continuing breach. Notwithstanding any limitation on Recipient’s liability, the Owner shall further be entitled any other rights and remedies that it may have at law or in equity.

If there is any actual or suspected theft of, accidental disclosure of, loss of, or inability to account for any Confidential Information by Recipient or any of its subcontractors (collectively “Disclosure”) and/or any unauthorized intrusions into Recipient’s or any of its subcontractor’s facilities or secure systems (collectively “Intrusion”), Recipient must immediately, i) notify Owner, ii) estimate the Disclosure’s and/or Intrusion’s effect on Owner, iii) specify the corrective action to be taken, iv) investigate and determine if an Intrusion and/or Disclosure has occurred and v) take corrective action to prevent further Disclosure and/or Intrusion. Recipient must, as soon as is reasonably practicable, make a report to Owner including details of the Disclosure (including Customer(s)’ identities and the nature of the information disclosed) and/or Intrusion and the corrective action Recipient has taken to prevent further Disclosure and/or Intrusion. Recipient must, in the case of a Disclosure, cooperate fully with Owner to notify Owner’s Customer(s) as to the facts and circumstances of the Disclosure of the Customer’s particular information (as applicable). Additionally, Recipient must cooperate fully with all government regulatory agencies and law enforcement agencies having jurisdiction and authority for investigating a Disclosure and any known or suspected criminal activity.

(1) Service Provider shall at all times comply with the Payment Card Industry Data Security Standard Requirements (“PCI Data Security Standard Requirements”) for Cardholder Data, as they may be amended from time to time. The current PCI Data Security Standard Requirements are available on the following internet website: www.visa.com/cisp. Service Provider’s failure to comply with PCI Data Security Standard Requirements may result in fines and penalties. Service Provider is fully liable for and shall indemnify, defend and hold Bank harmless from any fines or penalties imposed on Bank due to Service Provider’s lack of compliance with PCI Data Security Standard Requirements.

(2) Cardholder Data may only be used for assisting in completing a card transaction, for fraud control services, for loyalty programs, or as required by applicable law.

(3) If there is a breach or intrusion of, or otherwise unauthorized access to Cardholder Data stored at or for Service Provider, Service Provider shall immediately notify Bank, in the manner required by the PCI Data Security Standard Requirements, and provide Bank and the acquiring financial institution and their respective designees access to Service Provider’s facilities and all pertinent records to conduct an audit of Service Provider’s compliance with the PCI Data Security Standard Requirements. Service Provider shall fully cooperate with any audits of their facilities and records provided for in this paragraph.

(4) Service Provider shall maintain appropriate business continuity procedures and systems to ensure availability and security of Cardholder Data in the event of a disruption, disaster or failure of Service Provider’s primary data systems.

 

a. The Bank’s business operations are regularly audited by (i) various government agencies having supervisory and regulatory authority over the Bank (the “Regulatory Authorities”) and (ii) the Bank’s own internal auditors. The Bank is also required to audit its vendors.

b. Supplier must fully cooperate with the Bank’s efforts to meet its regulatory obligations and must comply in a timely manner with the Bank’s reasonable requests for documentation and information. Supplier’s refusal or failure to comply is a material breach of this Agreement. If the Bank reasonably determines that Supplier’s data security, internal controls, or financial stability are inadequate and not susceptible to cure within any reasonable time frame or that an unacceptable risk to the Bank or the Bank’s customer's exists, the Bank may terminate this Agreement by providing written notice to Supplier. The Bank will identify its reasons for such termination in the notice.

c. The following are deemed reasonable requests of the Bank, with which Supplier must comply:

i. Supplier must make its books, records, and operations relating to all products and services provided to the Bank or the Bank's customers available for audit or inspection by the Regulatory Authorities, by the Bank, or by the Bank’s independent auditors with at least 48 hours’ advance written notice from the Bank.

ii. Within five (5) business days of Bank’s written request, Supplier must provide all applicable audit reports, including but not limited to: SAS 70, performance, financial, internal control and security reviews; penetration testing; intrusion detection; and firewall configuration. The foregoing notwithstanding, Supplier is not required to provide reports which the Supplier does not prepare or have prepared in the normal course of Supplier’s business.

iii. If a deficiency is noted or determined in any such audit report, Supplier must also provide to the Bank any and all documentation related to resolution of the audit deficiencies and the corrective actions implemented to prevent recurrence of such deficiency.

d. Supplier must reasonably cooperate with the Bank’s periodic vendor assessments. The Bank is required on an annual or semi-annual basis to perform the following vendor assessments:

i. risk assessments with respect to the providers of goods and services for the Bank's business; and

ii. data security, internal controls and financial stability of those providers commensurate with the level of risk assessed.

e. The terms of this Section shall survive expiration or termination of this Agreement for any reason for at least two (2) years, but in no case less than might be required by law or applicable regulation.

10. Insurance. DebtResolve shall carry the following insurance coverage during the initial and all renewal terms or extensions including any extension of time during which the Agreement remains in force and effect on a month to month or ongoing basis:

 

(i) Workers' Compensation (statutory limits) and employer's liability ($1,000,000 limits) insurance to the extent required by the laws of the states(s) in which the Services are performed; and

 

(ii) Fidelity bonding of at least $5,000,000 for claims based upon and damages arising out of or relating to DebtResolve's or its employees' fraudulent or dishonest acts; and

 

(iii) Errors and Omissions Insurance or comparable coverage of at least $5,000,000 for claims based and damages arising out of or relating to DebtResolve's negligence, malicious act, omissions, errors, or similar malperformance of DebtResolve or its products, naming Client as loss payee; and

 

(iv) Commercial general liability and property damage insurance with combined bodily injury and property damage limits of at least $3,000,000 combined single limit for bodily injury, death, property damage, including personal injury, contractual liability, independent contractors, broad-form property damage, and products and completed operations coverage, naming Client as an additional insured.

 

10.2 Certificates of Insurance. DebtResolve shall deliver certificates of insurance and additional insured endorsements for the applicable policies, to Client prior to execution of this Agreement and no less than annually and/or upon Client’s request thereafter. The certificates of insurance shall evidence the coverage types, amounts described above and set forth the amount of all deductibles, and will be endorsed:

 

(i) in the name of Client, its officers, agents, and employees as additional insured (required for General Liability and Commercial Automobile Liability policies only);

 

(ii) to provide that each of the policies is primary insurance with respect to any other insurance available to Client as to any claim for which coverage is afforded under the policy; and

 

(iii) to provide that the policy shall apply separate to each insured against whom a claim is made or suit is brought (required for Commercial General Liability and Automobile Liability only).

 

10.3 Subcontractors to be insured. DebtResolve shall require all of its subcontractors to carry insurance coverage and limits as agreed to and approved in writing by Client.

 

10.4 Cancellation or Lapse of Insurance. DebtResolve shall give thirty (30) days prior written notice to Client of cancellation, non renewal, or material change in coverage, scope or amount of any policy. Should DebtResolve fail to keep in effect at all times the insurance coverages required under this Section, Client may, in addition to and cumulative with any other remedies available at law, equity, or hereunder withhold payments to DebtResolve required under this Agreement in an amount sufficient to procure the insurance required herein. If such right to withhold is insufficient, Client may, at its sole option, procure sufficient insurance coverage or a similar instrument, and Licensor agrees to reimburse Client for any and all costs incurred by Client as a result.

10.5 Claims made coverage.

To the extent that any insurance coverage required under this Section is purchased on a “claims-made” basis, such insurance shall cover all prior acts of Licensor during the term of this Agreement, and such insurance shall be continuously maintained until at least three (3) years beyond the expiration or termination of this Agreement, or DebtResolve shall purchase “tail” coverage, effective upon termination of any such policy or such termination or expiration of this Agreement, to provide coverage for at least three (3) years from the occurrence of either such event.

Export Control Regulations. Client acknowledges and agrees that none of the software or technology underlying the Customized Solution may be downloaded or otherwise exported or re-exported into or to a national or resident of any country to which the United States has embargoed goods or to anyone on the U.S. Treasury Department’s List of Specially Designated Nationals or the U.S. Commerce Department’s Table of Denial Orders. Client represents and warrants that it is not located in, under the control of, or a national or resident of any such country or on any such list.

 

Interpretation. The Parties acknowledge and agree that this Agreement has been freely negotiated and entered into by each Party and that no court should in any manner construe any ambiguity against the draftsman solely by virtue of its role as draftsman. Unless the context indicates otherwise, the term “or” shall be deemed to include the term “and” and the singular or plural number shall be deemed to include the other.

 

Independent Parties. The parties acknowledge, confirm and agree that they are independent contractors and this Agreement is not intended to create a joint venture, association, partnership, franchise or other form of business or relationship. Except as expressly provided in this Agreement, neither Party will have, nor hold itself out as having, any right or power or authority to assume, create or incur any expense, liability or obligation, express or implied, on behalf of the other Party, or to act on behalf of the other Party in any capacity or in any manner.