1. Transaction Processing Services
Per the terms of your Merchant Services Agreement (the “Agreement”) with CSG Forte, the following clauses are hereby amended by Forte as of July 1, 2020 (“Effective Date”). You will demonstrate your acceptance of these amendments through your continued use of the services after the Effective Date. Please review the full amended contract language below and contact us with any questions of concerns regarding these changes to your Agreement service terms.
1. The TRANSACTION PROCESSING SERVICES section shall be amended as follows:
(a) Delete and replace the Reserve clause with the following:
FORTE may require a security deposit or Reserve to process Transactions for Merchant. The Reserve may be used by FORTE to offset any returned items, chargebacks, fees/fines, billing or other Merchant obligations to FORTE that FORTE is unable to collect from Merchant. Should FORTE determine that a Reserve is required, FORTE will provide Merchant notice in writing, including email, regarding amount required and form of collecting the reserve. Merchant authorizes FORTE to make withdrawals or debits from the Reserve funds, without prior notice to Merchant, at such times and in such amounts as may be necessary to fulfill Merchant’s obligations under this Agreement. Merchant also understands and agrees that such funds will be held in a non-interest-bearing account with FORTE’s ODFI and as such, FORTE shall not be responsible to Merchant for any interest on such funds. The Reserve amount may be revised based on periodic review of Merchant’s financial condition, Transaction volumes, transaction amounts and return ratios resulting in a greater or lesser Reserve amount. Merchant will be notified of any such revision.
The Reserve may be funded through any or all of the following: (a) Direct payment by Merchant; or (b) A percentage of the Transactions settled on Merchant’s behalf (a rolling Reserve).
The Reserve funds shall be held by FORTE for a minimum of ninety (90) calendar days beyond the date of the last item processed by FORTE on Merchant's behalf. In the event FORTE has reason to believe that (a) Merchant has acted in a fraudulent manner with regard to its account with FORTE or any Transaction processed through FORTE’s systems; or (b) Merchant has not obtained proper authorization for one or more transactions; or (c) Merchant will not be able to meet its obligations to FORTE; or (d) FORTE is at risk of incurring additional expenses/potential losses in relation to Services provided to Merchant pursuant to this Agreement, FORTE may extend the hold on Merchant’s Reserve funds up to two (2) years from the last transaction activity date or the maximum time allowed by law upon written notice to Merchant (including electronic mail) at the contact information FORTE has on file for Merchant’s account. After expiration of the hold time period, and subject to any extension(s) hereunder, FORTE will then attempt to release the Reserve funds to Merchant less any fees and/or any other amounts owed to FORTE using the bank account information FORTE has on file for Merchant. It is Merchant’s obligation to update FORTE with any change in bank account and/or to request release of the held funds. Should FORTE be unable to successfully credit the release of funds to Merchant’s designated bank account after the hold time has expired, FORTE is obligated to escheat the funds held to the state in which Merchant is located per that state’s escheatment laws.
(b) Delete and replace the Funding Hold clause with the following:
Funding Hold. Should any of the following occur: (i) Merchant’s account experiences funding issues including but not limited to chargebacks or returned funding or billing; (ii) FORTE observes irregular, suspicious or possible fraudulent Transaction activity on Merchant’s account; or (iii) FORTE is required by law or at the instruction of our ODFI or a Payment Association, FORTE reserves the right to place a funding hold on Merchant’s processing account without prior written notice to Merchant. In the event FORTE places a funding hold on Merchant’s account under the terms of this Section, FORTE will provide Merchant with notice of the hold and the reason for such hold so long as communicating such would not create a security risk or violate any legal obligation of FORTE. Any funds held under this Section will be treated as a Reserve and be governed by the terms of this Section 4.
(c) Add the following clause:
Temporary Suspension of Services. Should any of the following occur: (i) FORTE observes irregular, suspicious or possible fraudulent Transaction activity on Merchant’s account; (ii) FORTE determines there is an irregularity in Merchant’s account, documentation, processes or financial condition that is inconsistent with FORTE’s risk requirements; (iii) Merchant is in material breach of its payment or other financial obligations to FORTE; or (iv) as required by Laws, Rules or Payment Association, FORTE reserves the right to temporarily suspend Services to Merchant without prior written notice. In the event FORTE suspends Services to Merchant under the terms of this Section, FORTE will provide Merchant with notice of the suspension and the reason for such suspension, along with remediation actions so long as communicating such would not create a security risk or violate any legal obligation of FORTE.
(d) Delete and replace the Authorization clause with the following:
Authorization. Merchant specifically authorizes FORTE as follows: (i) to debit and credit Merchant’s designated bank account in order to carry out its duties under this Agreement; (ii) to debit its designated bank account and any account owned by the same entity as Merchant or by an entity with the same tax identification number as Merchant to collect any payment obligation owed to FORTE by Merchant hereunder. Further, Merchant authorizes FORTE to act as its Agent for the receipt of settlement funds in connection with the Services, and FORTE accepts such appointment subject to any conditions and limitations of this Agreement. Merchant agrees that receipt by FORTE of a customer’s funds shall constitute receipt of payment to Merchant, extinguishing the customer’s payment obligation to Merchant as if the customer had paid Merchant directly. If FORTE fails to fund Merchant’s account in an amount corresponding to customer’s payment, Merchant’s sole recourse shall be to FORTE, not the customer.
2. The CONFIDENTIALITY section shall be amended as follows:
(a) Add the following language to the Merchant’s Confidentiality clause: “as defined in Appendix A” to the first reference to Confidential Information.
(b) Add the following clause:
Mutual Confidentiality of Consumer Financial Information. In the course of providing and receiving the Services, each Party acknowledges that it may receive or have access to information which can be used to identify an individual consumer (including, without limitation, names, signatures, addresses, telephone numbers, e-mail addresses, payment history, and other unique identifiers) (“Personal Information”). As such, each Party shall: (i) keep all Personal Information in strict confidence, with the degree of care necessary to avoid unauthorized access, use or disclosure; (ii) use Personal Information solely and exclusively for the purposes provided in this Agreement; (iii) implement administrative, physical and technical safeguards to protect Personal Information that are at least as rigorous as accepted industry practices; (iv) as applicable, have in place a program that complies with applicable legal requirements regarding Personal Information.
3. The COMPLIANCE WITH RULES AND LAWS section shall be amended to add the following: Merchant shall comply with FinCEN Rules regarding beneficial ownership and shall promptly notify Forte of any change in ownership.
4. The TERM AND TERMINATION section shall be amended as follows:
(a) Delete and replace the Term clause with the following:
Term. The Agreement shall have an initial term of three (3) years from and after the Effective Date and shall automatically renew for successive one (1) year terms unless either party provides thirty (30) days’ prior written notice of termination to the other party. Merchant’s account will be closed at the end of the then-current billing cycle.
(b) Delete and replace the Immediate Termination clause with the following:
Immediate Termination. FORTE may immediately terminate the Agreement without prior notice under the following conditions: (i) in the event Merchant is or becomes bankrupt or is unable to pay its debts as they become due; (ii) if FORTE reasonably determines that Merchant has violated any material term, condition, covenant, or warranty of the Agreement; (iii) FORTE determines that the type of business in which Merchant is engaged is or becomes an industry or business that FORTE is prohibited from providing its services to; (iv) if Merchant is using the Services for a purpose other than a permissible use; (v) if FORTE observes irregular, suspicious or possible fraudulent Transaction activity on Merchant’s account that is reasonably determined to expose FORTE to risk of financial, reputational, or other measurable loss; (vi) if FORTE reasonably determines that Merchant is the subject of a government investigation that is likely to impact Merchant’s receipt of the Services; or (vii) if FORTE is instructed to terminate by Financial Institution (including but not limited to an ODFI), Acquirer or Payment Association.
5. The NOTICE section shall be deleted in its entirety and replaced with the following:
NOTICE. Any notice, consent or other communication required or contemplated by this Agreement shall be in writing, and shall be delivered in person, by U.S. mail, by overnight courier, by electronic mail or by fax to the intended recipient at the address most recently provided in writing.
6. The GENERAL PROVISIONS clause shall be amended as follows:
(a) Delete and replace the Governing Law clause with the following:
Governing Law. The Agreement shall be governed by and construed in accordance with the internal laws of the state of Delaware without reference to choice of law rules. Merchant hereby agrees that claims applicable to American Express may be resolved through arbitration as further described in the American Express Merchant Operating Guide, see Appendix C, Section 4 herein.
(b) Delete and replace the Force Majeure clause with the following:
Force Majeure. Neither party will be held liable for any damages, delay or failure to perform any of its obligations under this Agreement if such damages, delay or failure is due to circumstances beyond the reasonable control of such party and without its fault or negligence, such as acts of God, fire, flood, earthquakes or other natural disasters, epidemics, strikes and governmental acts or orders or restrictions. The party affected by such circumstances will use all commercially reasonable efforts to avoid or remove such causes of non-performance. Neither Party shall be liable for, or be considered in breach of or default under the Agreement on account of any delay or failure to perform its obligations hereunder as a result of any causes or conditions that are beyond such Party's reasonable control and that such Party is unable to overcome through the exercise of commercially reasonable diligence. If any force majeure event occurs, the affected Party shall give prompt written notice to the other Party and shall use all commercially reasonable efforts to minimize the impact of the event.
7. Revise Appendix A to include a definition of Confidential Information.
Confidential Information - Confidential Information may include information regarding all of the computer software and technologies, systems, structures, architectures, processes, formulae, compositions, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods, and information and databases developed, acquired, owned, produced or practiced at any time by a Party or any affiliate thereof, including software programs and documentation licensed by third parties to the disclosing Party, any business or financial information directly or indirectly related to the disclosing Party’s company(s) or investments or its internal administrative audit reports on internal controls, internal risk and underwriting guidelines and policies, billing and accounting systems, customer and vendor lists and information, employee personnel information and policies and procedures, information regarding the disclosing Party’s products and services that is not generally available to the public.