This Lithic Services Agreement (“Agreement”) is a legal agreement between Lithic, Inc. (formerly Pay with Privacy, Inc.), DBA Lithic (“Lithic”, “us”, or “we”), in our role as Processor and Program Manager, and the entity or person (“you” or “your”) who registered on the API Account page to receive certain card offering services, and other business services, that may be offered by us and our affiliates (each, a “Service”). This Agreement describes the terms and conditions that apply to your use of the Services. Your integration and use of the API with your platform is subject to your acceptance of the terms and conditions of this Agreement. By integrating and using the API, you expressly agree to the terms and conditions of this Agreement and any updates or modifications to this document made from time to time by us. You may not access or use the API or any Services unless you agree to abide by all of the terms and conditions in this Agreement. If you and Lithic execute Program Management — Enterprise Pricing Terms (“Enterprise Terms”), then the terms and conditions of the Enterprise Terms will supplement the terms and conditions of this Agreement. In the event of a conflict between the Enterprise Terms and this Agreement, the Enterprise Terms will control. The Service is a business product, to be used for commercial purposes. If you are a consumer and would like to access our virtual card products, please visit Privacy.com.
1. Our Services
- Our API and Solution
- We provide you and your business with a card issuing platform (“Solution”), which can be used as agreed by you and us. We make the Solution available via a suite of application programming interfaces (“APIs”) and Web-based dashboards. We will provide you with API keys to access the Solution. From time to time, we may update the API and related documentation, including by deprecating or removing product features. Our API documentation is available on our website. We may also make additional API documentation available to you.
- We provide support on general issues related to your API account and your use of the Program. We make resources available through our API documentation and on our website’s support pages. You can also contact us online or call us at 1-844-771-8229.
- Program Management
- We work with our Bank Partners to offer the Services. Our Bank Partners provide regulated financial services to you and your customers. These services may include opening card accounts with our Bank Partners. We act as program manager for these services. As part of the Solution, we will manage and perform some onboarding, compliance, customer service and financial partnerships functions.
- We are responsible to our Bank Partners for compliance with Applicable Laws and industry requirements. In exchange for our performance of these responsibilities, you agree to assist us with our obligations to our Bank Partners. Your specific responsibilities are set forth under Section 2 — Your Obligations (collectively, with our efforts and operations, the “Program”).
- From time to time, a new law, rule or requirement may be imposed on the Program by a Regulatory Authority, Payment Network, Bank Partner or similar third party (“Critical Change”). In the event of a Critical Change, you agree to cooperate and use commercially reasonable efforts to make any required changes to the Program. Until such time that the Program has been updated to address the Critical Change, we may take any actions necessary to ensure compliance with requirements and expectations from any Regulatory Authority, Payment Network, Bank partner or similar third party. If a Critical Change impacts interchange revenue or other fees associated with the Program, we reserve the right to make corresponding adjustments to Customer Revenue share percentages and other financial terms.
- Revenue Share
- We will share a portion of the Program’s revenue in accordance with the API Pricing section of our website and other applicable terms of this Agreement (“Customer Revenue”). Customer Revenue will be measured based on monthly interchange-eligible transaction volume, net of any amounts returned to the Payment Networks due to chargebacks, refunds, disputes or other related transactions. For purposes of calculating percentages related to Customer Revenue, transaction volume will reset each month. We reserve the right to change Customer Revenue share percentages if the Payment Networks change network fees, change interchange rates or make some other change related to interchange rates. In the event you fail to comply with your obligations in this Agreement, including timely responses to our requests for information, we may withhold any Customer Revenue until such time you have fully remedied the noncompliance. If you and Lithic have not executed Enterprise Terms, we also may revise the Customer Revenue share percentages at any time; however, we will use commercially reasonable efforts to provide you with at least 15 days’ advance notice prior to changing the percentages applicable to you (or a longer period of notice if required by Applicable Law).
2. Your Obligations
- Account Registration
- You agree to keep all information requested in connection with your API Account current. You must promptly update us regarding any changes affecting you, the nature of your business activities, your representatives, your principal owners, your principals, or any other pertinent information. We may suspend your API Account or terminate the Services if you fail to keep this information current.
- You agree to promptly notify us in writing no more than three (3) days after any of the following occur: (a) you become subject to an Insolvency Event; (b) there is an adverse change in your financial condition; (c) there is a planned or anticipated liquidation or substantial change in the basic nature of your business; (d) you transfer or sell 25 percent (25%) or more of your total assets or there is any change in the control or ownership of your business or parent entity; or (e) you receive a judgment, writ or warrant of attachment or execution, lien, or levy against 25 percent (25%) of more of your assets.
- If you fail to honor these obligations, your API Account may be suspended or terminated. You are fully responsible for all activity that occurs under your API Account, including for any actions taken by persons to whom you have granted access to the API Account. We reserve the right to suspend or terminate the API Account if you provide inaccurate or incomplete information, or who fail to comply with account registration requirements.
- Adding a Funding Source
- In order to use the Services, you must first add an eligible funding source to your API Account via our website. By connecting a funding source, you pre-authorize recurring transfers by us from that funding source. When you add a funding source to your API Account, you agree that:
- You are the owner of the funding source, or a control person representing the owners;
- You are authorized to transfer funds from that funding source;
- You authorize us to initiate debits from your funding source according to your instructions; and
- If a settlement or debit is processed via ACH, you acknowledge that the NACHA Operating Rules will apply to the settlement or debit, and you agree to be bound by these rules.
- UX and UI Review and Approval
- To facilitate compliance with Applicable Laws, you must collaborate with us and submit Program-related UX and UI designs for feedback and approval. You must ensure Cardholders agree to the Program’s approved cardholder agreement, ACH authorization agreement and any applicable privacy policies in a legally binding manner. You must maintain records of each Cardholder’s agreement to Program related terms, in a manner that can be easily retrieved and shared with us and our partners. You must also ensure Cardholders are provided with disclosures required by the Rules, Applicable Laws and our partners.
- Marketing Review Process
- You are responsible for the design of Program marketing and customer acquisition materials and agree to submit all such materials for our prior review and approval. You agree to incorporate our feedback to ensure compliance with applicable financial services and consumer protection laws. As needed, you will cooperate with us to obtain approval from our partners. You must exclusively use approved materials when marketing the Program.
- The Solution involves use of regulated financial services products, requiring the parties to meet obligations imposed by U.S. financial services protection, anti-money laundering, and sanctions laws. You agree to operate in accordance with the terms in this Agreement and any API documentation provided by us.
- To facilitate the safety of the Program, you agree to:
- Appoint a person to manage your participation in the Program, including managing card use by end users.
- Use the APIs as instructed by our API documentation and other communications from us, including implementation guides, slack messages in shared integration channels, emails and bulletins.
- Make timely changes to your code to facilitate the Program’s compliance with changes in Rules, Applicable Laws and industry standards such as PCI-DSS.
- Secure your API keys and contact us immediately if you become aware of any unauthorized use of the keys or any other security incident regarding use of the Solution.
- Implement and operate the approved UX and UI for Cardholder onboarding, in accordance with Section 2.a — Program Setup of this Agreement.
- Use only marketing and other customer-facing materials that have been approved in accordance with Section 2.a — Program Setup of this Agreement.
- Use the API to send us all personally identifiable information and metadata about Cardholders, as required in our API documentation and as may otherwise be communicated from time to time by us. You must also assist us in efforts to obtain additional information about Cardholders as required to meet anti-money laundering obligations and facilitate general risk management practices. In particular, if any of the Cardholders of the Program are businesses, with respect to each Cardholder business’ legal entity, you must assist us in efforts to obtain identifying information for: (a) each individual, if any, who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, owns 25 percent or more of the equity interests of the legal entity; and (b) one individual with significant responsibility for managing the legal entity, such as an executive officer or senior manager (e.g., CEO, CFO, COO, Managing Member, General Partner, President, Vice President, Treasurer) or any other individual who regularly performs similar functions.
- Cooperate and allow us and our partners to perform approval, audit and oversight functions in accordance with the terms found in Section 2.a — Program Setup, and elsewhere in this Section 2.b of the Agreement.
- Promptly provide us with all required information to support our obligations as Program Manager, including but not limited to information to support anti-money laundering and customer dispute resolution efforts. We may make inquiries that we consider appropriate and use third party services to help us verify the identifying information provided and help us determine if we should open, maintain, collect or close your API Account or card access for any Cardholder. We may also report the status, history or closure of your API Account or any limitation of Cardholder access to third-parties.
- Carry appropriate corporate insurance, commensurate to the risks associated with your ordinary course business offerings.
- Cooperate with us to periodically review the Program for legal and compliance risks. Reviews will occur during a mutually agreed upon time, but no later than one week from our initial request for a review. You must provide any requested materials in a timely manner. You must promptly work with us to address any areas of the Program that are identified as needing enhancement during each review.
- Allow us and our Bank Partners, (“Auditing Party”), at any time during normal business hours and upon reasonable notice, to inspect, audit, and examine all of your facilities, books and records, financial records and reports, personnel, the Data Security Program and associated audit reports, summaries of test results or equivalent measures taken by you to ensure that the Data Security Program complies with Applicable Law, the Rules and this Agreement (“Audit Materials”); and that you are otherwise in compliance with the terms of this Agreement, Rules and Applicable Law. The Auditing Party will have the right to make copies of and abstracts of the Audit Materials. Each Auditing Party will have the right at any time during normal business hours and upon reasonable notice to you to request copies of documentation or confirmation of the absence of documentation of the Audit Materials in good faith, to support each Auditing Party’s direct and indirect requirements under their respective vendor risk management programs, and preparation for the Auditing Party’s own annual due diligence audit.
- Cooperate with us to address compliance and fraud risks that arise during the term of this Agreement. We agree to collaborate with you on processes and technical solutions to address new fraud and risk challenges. You must promptly implement technical and process changes requested by us pursuant to this Section. We may choose to suspend the creation of new accounts or suspend Cardholder spend if an emerging compliance or fraud issue creates material risk to legitimate Cardholders, either party, our Bank Partners, our vendors or a Payment Network. In particular, we may suspend new account creation and suspend Cardholder spend if the average transaction decline rate reaches levels we, in our sole discretion, deem present unacceptable risk to the Program.
- Not use the Services in connection with the following businesses or activities: (1) any illegal activity or goods, (2) paraphernalia that may be used for illegal activity (3) unauthorized multi-level marketing businesses, (4) rebate-based businesses, (5) betting, including lottery tickets, sports related gambling, casino gaming chips, off-track betting, and wagers at races, (6) manual or automated cash disbursements, (7) purchasing prepaid cards or checks for resale, (8) sales of money-orders or foreign currency, (9) wire transfer money orders, (10) high-risk products and services, including telemarketing sales.
- Provide your own customer service functions, subject to compliance with specifications provided by us. Your customer support operations must comply with applicable consumer financial services laws (e.g., Reg E) and payment network rules.
- Comply with, and take all appropriate and necessary steps to ensure the Program complies with, all Applicable Laws, including but not limited to financial services laws and regulations relating to anti-money laundering, sanctions, consumer protections, false advertising, privacy and data security.
Your Financial Obligations
- You must promptly fund program bank accounts to cover any amounts incurred or expected to be incurred by Cardholders. For purposes of this Program, you will either: (i) prefund all Cardholder spending into a For Benefit Of (“FBO”) Account at one or more of our Bank Partners; or (ii) fund all Cardholder spend by the following business day, whether from your own funds or by ensuring Cardholders agree to the relevant ACH authorizations and commit to daily withdrawals from such Cardholder’s own bank account to pay for the spend. In the event you choose to have Cardholders fund the Program directly, you are liable for any Cardholder spend that we are not able to recover directly from any such Cardholder. We and you must mutually agree on a funding structure prior to the Program exiting its beta product stage. The obligations of this Section are in addition to the minimum balance requirements set forth in Section 2.c.ii — Payment Reserve below.
Payment Reserve and Daily Limit
- To fund the Program’s payment volume, you must maintain a minimum reserve balance acceptable to us. The minimum reserve balance must be at least three times the largest daily settlement amount for the Program in the preceding thirty (30) days. We and you must agree on an initial amount prior to the Program commencing operations. We may periodically require a different minimum balance to cover the purchases made through the Program. You must add funds each day to ensure the payment reserve holds enough funds to meet the minimum balance. You shall not be entitled to interest on the amounts held as a reserve balance.
- We may use the funds on deposit in the payment reserve to satisfy any of your obligations to us under this Agreement, including, but not limited to, obligations related to fraud, payments, legal fees, fines, and indemnities.
- We may suspend the creation of new cards, suspend all Cardholder access, and/or declare you in default of this Agreement if we must draw upon funds in the payment reserve more than three (3) times during a rolling twelve-month period of the Program, or if at any time the balance of funds in the payment reserve falls below the minimum reserve balance and you fail to replenish the payment reserve to the required level within two (2) business days after written notice from us.
- We may set, and adjust from time to time in our sole discretion, a daily spending limit (“Daily Limit”) for the Program. The initial Daily Limit will be the Program’s reserve balance divided by three (3); provided, however, you may not unilaterally increase your Daily Limit by adding additional funds to the reserve balance. We may, at our sole discretion, increase or decrease the Daily Limit based on considerations such as Program transaction history, amounts in the reserve balance, credit and other risk considerations. You must monitor Program spend to ensure that it is always below the Daily Limit. If the Program’s daily authorized transactions are greater than the Daily Limit, we may, at our sole discretion, take action to address the matter, including but not limited to any combination of the following actions: 1) decline further transactions; 2) suspend the creation of new accounts, including new card creates; and 3) allow transactions in excess of the Daily Limit, provided we may assess late fees on any transactions in excess of the Daily Limit, and the late fee will be the lesser of 1.5% per month, or the highest rate permitted by law.
- In connection with setting the Daily Limit, we may request you furnish information including but not limited to bank statements and financial statements. We reserve the right to suspend future transactions or suspend the creation of new accounts, including new card creates, if such information is not provided in a reasonable period of time.
- To access the Solution, you agree to pay the fees found in this Section and the API Pricing section of our website; provided, however, if you and Lithic execute Enterprise Terms, the Enterprise Terms will control. All fee, cost and expense amounts owed to us shall be deducted from your Customer Revenue amounts. To the extent fee, cost and expense amounts you owe us in any month are greater than the Customer Revenue amounts, we will debit such amounts from your linked funding source and (as needed) from funds held in the payment reserve. Where applicable, we will use commercially reasonable efforts to pass through actual, attributable bank and network fees, but we reserve the right to estimate those fees when direct attribution is not possible. If your Enterprise Terms set forth per physical card pricing, we reserve the right to make adjustments to the per physical card pricing by providing you written notice.
- You are liable to us for any and all losses suffered or incurred by us or our Bank Partners in connection with the Program, including without limitation, settlement failures, chargebacks, Cardholder disputes, transaction disputes, over-limit processing, value load processing, under floor limit processing, losses, good faith credits, refunds, reversals, any overdrafts, negative balances, reversals of provisional credits and provisional credits, fraud losses, restitution payments to Cardholders, and claims and damage of any kind incurred by us with respect to transactions or claims of Cardholders, a Payment Network or a Regulatory Authority. We will submit to you invoices for any such losses incurred by us and you will pay such amounts immediately upon receipt of the invoice unless otherwise stated in this Agreement.
3. Confidentiality, Data Security and Intellectual Property
- Disclosures to Program Related Parties Subject to the provisions of Section 3.a.iii — Termination of Obligations and Section 4.j — Assignment, you may disclose our Confidential Information to an affiliate or service provider that is performing any obligation of yours under this Agreement; except you may disclose only the Confidential Information that is necessary for the affiliate’s or service provider’s performance. Confidential Information disclosed to or accessed by your affiliates or service providers will remain your responsibility and constitute Confidential Information in your possession, custody or control for purposes of this Section 3.a — Confidentiality.
- Termination of Obligations Except as otherwise provided in this Agreement, at any time or upon the termination of this Agreement, you will, at our discretion: (a) return to us all materials belonging to us that constitute our Confidential Information, or (b) securely destroy our Confidential Information and provide us a written certification signed by an authorized officer of yours that all such information was destroyed; except that you may retain our Confidential Information to the extent required to comply with Applicable Law or Rules; provided that you will continue to maintain the confidentiality of our Confidential Information pursuant to the terms of Section 3.a — Confidentiality.
b) Data Security
- Data Security Program You must establish and maintain appropriate administrative, technical and physical safeguards designed to: (a) protect the security, confidentiality and integrity of the Program Data and other Confidential Information; (b) ensure against any anticipated or emerging threats or hazards to its security and integrity; (c) protect against unauthorized access to or use of such information or associated records which could result in substantial harm or inconvenience to any User or Cardholder; and (d) ensure the proper disposal of Program Data (collectively, the “Data Security Program”).
- Our Status as PCI Service Provider We comply with PCI DSS to the extent that we possess or otherwise store, process, or transmit cardholder data on behalf of customers, and to the extent that we could impact the security of your cardholder data environment.
- Compliance with PCI Requirements If you elect to store “Account Data” or “Sensitive Authentication Data”, as those terms are defined by the PCI Standards, you must maintain a system compliant with the PCI Standards. If you do not comply with the PCI DSS, or if we are unable to verify your compliance with the PCI DSS, we may suspend your access to the Solution. If you intend to use a service provider to store or transmit Account Data, you must not share any data with the service provider until it verifies that the third party holds sufficient certifications under the PCI DSS, and notify us of your intention to share Account Data with the service provider.
- Notice of Security Incidents If you become aware of any misuse or compromise or unauthorized or accidental loss, destruction, alteration, disclosure or acquisition of or access to Program Data in your possession, custody or control, (a “Security Incident”), or reasonably suspects that a Security Incident has occurred, you must immediately report the suspected or actual Security Incident to us upon becoming aware of the Security Incident, but in no case later than 48 hours after you become aware of the Security Incident. Such report will summarize in reasonable detail the effect on the Program, if known, the nature of the Security Incident (including, if known, the categories and approximate number of individuals and Confidential Information records affected, and the likely consequences of the Security Incident) and all other relevant details.
- Response to Security Incident You must promptly take all necessary and advisable corrective actions and will cooperate with us in all reasonable and lawful efforts to prevent, mitigate, or rectify such Security Incident. You must take reasonable steps to investigate, prevent the recurrence of, and remedy the Security Incident (which will include appropriate instructions to your affiliates and service providers, if applicable). You must provide us with commercially reasonable assurances as we or our partners may request that such Security Incident is not likely to recur. If we or our partners reasonably believe that the security measures put in place by you (including the security measures of the affiliates and service providers) are insufficient to prevent future Security Incidents, we may provide guidance to you regarding prevention of Security Incidents, and require that you take additional measures to prevent additional Security Incidents. In no event will the guidance provided, or additional measures required, by us exempt you from liability for any future Security Incidents.
- Disclosure to Third Parties Except as may be required by Applicable Law or industry rules, you will not inform any third party of any Security Incident without our prior written consent. If Applicable Law requires disclosure of the Security Incident, you will collaborate with us regarding the content of the disclosure in order to minimize any potential adverse impact upon us, our partners, customers and any other third party affected by the Security Incident. The content of any filings, communications, notices, press releases or reports related to any Security Incident will be subject to our written approval prior to their publication or communication. In addition to all remedies available to us under Applicable Law, we will be entitled to all available equitable remedies in the event of a Security Incident or threat of a Security Incident and may seek injunctive relief from a court of competent jurisdiction without the necessity of proving actual loss.
c) Licences and Intellectual Property
- Software License Grant to You We grant you a revocable, non-exclusive, non-transferable, royalty-free limited license to access and/or use our API, Services, developer toolkits, dashboard, documentation and other software (collectively, the “Lithic IP”) in accordance with the accompanying documentation made available by us for purposes of using the Services. This license grant includes all updates, upgrades, new versions and replacement software for your use in connection with the Services. If you do not comply with the documentation and any other requirements provided by us, then you will be liable for all resulting damages suffered by you, Lithic and third parties. You agree not to alter, reproduce, adapt, distribute, display, publish, reverse engineer, translate, disassemble, decompile or otherwise attempt to create any source code that is derived from the Services. Upon expiration or termination of this Agreement, you will immediately cease all use of any Service.
- Trademark License Grant to You We grant you, your affiliates, and any subsidiaries a limited, nonexclusive, revocable, royalty-free, and nontransferable license to use our trademarks solely in connection with this Agreement to the extent such use is necessary for you to perform your obligations under this Agreement. Title to and ownership of our trademarks will remain with us. This license terminates immediately upon termination of this Agreement, unless terminated earlier by us. Upon expiration or termination of this Agreement, you will immediately cease all display, advertising and use of all of the trademarks, including the logos and trademarks of the Payment Networks.
- Trademark License Grant to Us You grant us, our affiliates, and any of our partners and service providers for the Program a limited, nonexclusive, revocable, royalty-free, and nontransferable license to use your trademarks solely in connection with this Agreement and to the extent such use is necessary for us to perform our obligations under this Agreement. Title to and ownership of your trademarks will remain with you. This license terminates immediately upon termination of this Agreement, unless terminated earlier by you.
- No Rights in Lithic IP Except for the express licenses granted above, we are not granting or assigning to you, your service providers or your affiliates any right, title, or interest, express or implied, in or to our IP, or the IP of any third party to which we have been granted a license; and we reserve all rights in our IP, and to the IP rights granted to us by any third party.
As between you and us, we and our licensors and service providers exclusively own all rights, title, and interest in the patents, copyrights (including rights in derivative works), moral rights, rights of publicity, trademarks or service marks, logos and designs, trade secrets, and other intellectual property embodied by, or contained in the Lithic IP or any copies thereof. Lithic IP is protected by copyright, trade secret, patent, and other intellectual property laws, and all rights in Lithic IP not expressly granted to you in this Agreement are reserved.
You may choose to submit comments or ideas about improvements to our Services, our API, our platform, or any other component of our products or services (“Ideas”). If you submit an Idea to us, we will presume, and you agree, that your submission was voluntary, and delivered to us without any restrictions or expectations on our use of the Idea. You also agree that we have no fiduciary or any other obligation to you in connection with any Idea you submit to us, and that we are free to use your Ideas without any attribution or compensation to you.
4. General Terms
Representations and Warranties
By signing up for and using the Services, you represent and warrant that:
- Your company is a duly organized entity, validly existing and in good standing under the laws of the jurisdiction in which it was formed, and it has full power and authority to carry on its business as conducted and to own and operate its properties and assets;
- You have all requisite power and authority to enter into, adopt, and perform all of its obligations under this Agreement; and the execution, adoption, and delivery of this Agreement has been duly and validly authorized by all necessary corporate action on its part; and, upon execution and delivery, this Agreement will constitute a legal, valid and binding obligation, enforceable against you in accordance with its terms;
- Neither the execution, nor delivery, nor the performance by you is in violation of any Applicable Law, your charter or by-laws, or any contract, order, judgment, memorandum of understanding or other instrument to which you are a party or by which you are bound;
- No statement or information contained in this Agreement or any other document or statement furnished by or on behalf of you, when taken as a whole, contains any untrue statement of a material fact or omits a material fact necessary to make the statement not misleading; and
- Your company holds hold all licenses, permissions and authorizations necessary to conduct its business, and you will provide us with a copy of any relevant licenses, permissions or authorizations upon request.
Subject to Applicable Law and Rules, we may terminate your ability to use the Services, including without limitation your access to your API Account and any Web-based dashboards, and your and your Cardholders’ ability to make any payments or other transactions through the Program:
- If you breach, or if we believe you are likely to breach, any term of this Agreement;
- If we determine that your use of the Services carries an unacceptable amount of risk, including credit, payment or fraud risk;
- If we are expressly required to do so by order of a Regulatory Authority having jurisdiction over us, the Program’s sponsor banks, or a Payment Network; except that no prior notice will be required if such notice is prohibited by the Regulatory Authority, a Bank Partner or Payment Network;
- If we reasonably believe that any other legal, reputational or risk-based reason exists, in our sole discretion; or
- As set forth in Section 4.q — Force Majeure.
You agree to receive notices about the Services via electronic methods. We may provide disclosures and notices required by law and other information about your API Account to you electronically, by posting it on our website, pushing notifications through the Services, or by emailing it to the email address listed in your API Account. Electronic disclosures and notices have the same meaning and effect as if we had provided you with paper copies. Such disclosures and notices are considered received by you within twenty-four (24) hours of the time posted to our website, or within twenty-four (24) hours of the time emailed to you unless we receive notice that the email was not delivered. If you wish to withdraw your consent to receiving electronic communications, contact us through the support pages on our website. If we are not able to support your request, you may need to terminate your API Account.
You will indemnify us, the Program’s Bank Partners, their affiliates and their respective personnel (the “Indemnified Parties”) from and against any lawsuit, claim, liability, loss, penalty or other expense (including attorneys’ fees and cost of defense) we may suffer or incur as a result of, arising out of or relating to: (a) your use of the Services, (b) your breach of this Agreement and any other agreement you enter into with us or our service providers; (c) your acts or omissions; or (d) a violation of Applicable Law or Rules.
Limitation of Liability
NEITHER WE NOR THE PROGRAM’S BANK PARTNERS WILL BE LIABLE TO YOU WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE, FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY LOSSES, LOST PROFITS OR LOST REVENUES (EVEN IF SUCH LOSSES ARE FORESEEABLE, AND REGARDLESS OF WHETHER YOU HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES) RESULTING FROM, ARISING OUT OF, CAUSED OR INCURRED BY, OR RELATED TO OUR PERFORMANCE OF OUR OBLIGATIONS UNDER THIS AGREEMENT.
IN NO EVENT WILL OUR CUMULATIVE LIABILITY TO YOU FOR DIRECT LOSSES EXCEED THE TOTAL AMOUNT OF PROGRAM FEES EARNED BY US IN THE ONE (1) MONTH PRECEDING THE DATE ON WHICH THE CLAIM AROSE.
EXCEPT AS OTHERWISE EXPRESSLY STATED IN THIS AGREEMENT, WE MAKE NO EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES REGARDING THE SERVICES THAT WE OR ANY THIRD PARTY ON OUR BEHALF WILL PROVIDE UNDER THIS AGREEMENT, INCLUDING (I) WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE; (II) TITLE TO AND NON-INFRINGEMENT OF ANY TECHNOLOGY OR INTELLECTUAL PROPERTY PROVIDED TO OR USED BY EITHER PARTY; AND (III) ANY WARRANTIES ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE OR TRADE USAGE. EXCEPT AS OTHERWISE EXPRESSLY STATED IN THIS AGREEMENT, WE SPECIFICALLY DISCLAIM ANY REPRESENTATION OR WARRANTY THAT OUR SERVICES, OR THE SERVICES OF ANY THIRD PARTY PROVIDED IN CONNECTION WITH THIS AGREEMENT, WILL BE ERROR-FREE OR UNINTERRUPTED, OR THAT SUCH SERVICES WILL BE COMPATIBLE WITH, OR OPERATE IN, ANY COMPUTER OPERATING SYSTEM, NETWORK OR SYSTEM CONFIGURATION, OR ANY OTHER ENVIRONMENT. NO ORAL OR WRITTEN INFORMATION OR ADVICE GIVEN BY US OR OUR EMPLOYEES OR REPRESENTATIVES SHALL CREATE A WARRANTY OR IN ANY WAY INCREASE THE SCOPE OF OUR OBLIGATIONS.
Attorney’s Fees for Insolvency and Other Proceedings
If it becomes necessary for us to use legal counsel to enforce or prevent a breach of this Agreement or your obligations, whether or not suit is filed, you will immediately reimburse us for reasonably incurred attorney fees and other costs and expenses. You will also immediately reimburse us for all reasonable attorney's fees and costs incurred in connection with the representation of Lithic in any bankruptcy, insolvency, reorganization, or other debtor-relief or similar proceeding of or relating to (a) your company, (b) any person liable (by way of guaranty, assumption, endorsement, or otherwise) on any of the obligations under this Agreement, (c) this Agreement, or (d) any property that secures any of your obligations under this Agreement.
Dispute Resolution and Binding Arbitration
You agree to arbitrate any and all Disputes by a neutral arbitrator who has the power to award the same damages and relief that a court can.
YOU AGREE THAT ANY ARBITRATION UNDER THIS AGREEMENT WILL ONLY BE ON AN INDIVIDUAL BASIS; CLASS ARBITRATIONS, CLASS ACTIONS, PRIVATE ATTORNEY GENERAL ACTIONS, REPRESENTATIVE ACTIONS AND CONSOLIDATION WITH OTHER ARBITRATIONS ARE NOT PERMITTED. YOU WAIVE ANY RIGHT TO HAVE YOUR CASE DECIDED BY A JURY AND YOU WAIVE ANY RIGHT TO PARTICIPATE IN A CLASS ACTION AGAINST US. If any provision of this arbitration agreement is found unenforceable, the unenforceable provision will be severed, and the remaining arbitration terms will be enforced (but in no case will there be a class or representative arbitration). All Disputes will be resolved finally and exclusively by binding individual arbitration with a single arbitrator administered by the American Arbitration Association according to this Section and the applicable arbitration rules for that forum. The Federal Arbitration Act, 9 U.S.C. §§ 1-16, fully applies. Any arbitration hearing will occur in New York County, New York, or another mutually agreeable location. The arbitrator’s award will be binding on the parties and may be entered as a judgment in any court of competent jurisdiction. If we prevail on any claim for which we are legally entitled to attorney’s fees, we will ask the arbitrator to recover those fees from you. For purposes of this arbitration provision, references to you and us also include respective subsidiaries, affiliates, agents, employees, predecessors, successors and assigns as well as authorized users or beneficiaries of the Services. Subject to and without waiver of the arbitration provisions above, you agree that any judicial proceedings will be brought in and you hereby consent to the exclusive jurisdiction and venue in state court in New York County, New York, or federal court for the Southern District of New York.
This Agreement does not benefit or create any right or cause of action in or on behalf of any Person other than us, our Bank Partners and you. In particular, Cardholders and your service providers have no rights under this Agreement.
This Agreement does not establish or create an employer/employee relationship, partnership of any kind, joint venture, agency or trust between the parties. Rather, each party is an independent contractor with respect to the other party for all purposes related to this Agreement.
This Agreement and the rights, privileges, duties and obligations of the parties in this Agreement may not be assigned or delegated by you without our prior written consent. Unless otherwise agreed by us in writing, assignment will not relieve you of your duties or obligations under this Agreement.
Updates to this Agreement; Waivers
We may amend, change or update this Agreement at any time with notice that we deem to be reasonable in the circumstances by posting the revised version on our website or communicating it to you through the Services (each an “Updated Version”). The Updated Version will be effective as of the time it is posted. Your continued use of the Services after the posting of a Updated Version constitutes your acceptance of the Updated Version. Any Dispute that arose before the changes will be governed by the terms and conditions in place when the Dispute arose. You may not amend, modify, or waive in any fashion any instrument or provisions in this Agreement. Our waiver of any breach of this Agreement by you will not operate or be construed as the waiver of the same or any other similar breach on a subsequent occasion, nor will any delay in exercising any right, power or privilege granted by this Agreement constitute such a waiver.
Unless prohibited by a Regulatory Authority, any dispute, controversy or claim resulting from a party’s rights and obligations under this Agreement, whether in contract, tort, equity or otherwise, and including any question regarding its existence, validity, construction or termination, will be governed by, construed, interpreted, and enforced in accordance with the laws of the state of New York; and subject to Section 4.h — Dispute Resolution and Binding Arbitration, will be subject to the exclusive jurisdiction of the state and federal courts located in New York City.
This Agreement (together with all documents referred to within it) embodies the entire understanding of the parties and supersedes and extinguishes in their entirety all prior communication, correspondence, and instruments, including any non-disclosure or confidentiality agreements, and there are no further or other agreements or understandings, written or oral, in effect between the parties relating to the subject matter of this Agreement. You agree that you shall have no remedies in respect of any statement, representation, assurance or warranty (whether made innocently or negligently) that is not set out in this Agreement. You agree that you shall have no claim for innocent or negligent misrepresentation or negligent misstatement based on any statement in this Agreement.
Right to Subcontract
We may engage one or more service providers to perform any of our obligations under this Agreement. We will only retain a service provider that we reasonably expect to be suitable and capable of performing the delegated obligations in accordance with this Agreement.
We may refer to you in public statements, announcements, or other publicity related to this Agreement.
We will not be liable for delay or failure to perform, in whole or in part, any of our duties under this Agreement due to factors beyond our reasonable control, including lack or failure of raw materials, strike, lockout or other labor disturbance, sabotage, health emergency, terrorism, acts of war or other armed conflict, earthquake, storm, fire, electrical supply or telecommunications failure (each, a “Force Majeure Event”).
Each party will be solely responsible for calculating any sales, use or other taxes applicable to it resulting from Program activities, if any, and determining any filings required to be made with any Regulatory Authority in connection with this Agreement.
The rights conferred upon Lithic are not meant to be exclusive of each other or of any other rights and remedies of ours under this Agreement, under Applicable Law, or in equity. Rather, each and every right of ours, under Applicable Law, or in equity is cumulative and concurrent and in addition to all other rights we may have.
The provisions of Section 2, Section 3.a, Section 3.b and Section 4, and any other provisions of this Agreement that expressly state they survive the termination or expiration of this Agreement, or that must survive in order to give effect to their intent and meaning, will survive such termination or expiration.
If any provision of this Agreement, or the application of any such provision to any person or circumstance, is invalid or unenforceable, the remainder of this Agreement, or the application of such provision to persons or circumstances other than those as to which it is invalid or unenforceable, will not be affected by such invalidity or unenforceability, and the parties expressly authorize any court of competent jurisdiction to modify any such provision so that such provision will be enforced by such court to the fullest extent permitted by Applicable Law.
From time to time, you shall execute such documents and perform such acts and things as we may reasonably require to give full effect to the purpose and provisions of this Agreement.
Term: We may terminate this Agreement at any time by providing you written notice. If you and Lithic execute Enterprise Terms, those terms will supersede this subsection.
“AAA” is defined in Section 4.h — Dispute Resolution and Binding Arbitration and means the American Arbitration Association.
“Account Data” has the definition provided in the PCI Standards.
“Agreement” means this Lithic Services Agreement between you and us, as defined in the first paragraph of this Agreement.
“APIs” means our application programming interfaces, as defined in Section a.1 — Our API and Solution.
“API Account” is defined in Section 2.a.iii — Account Registration.
“Applicable Law” means any: (a) statute, ordinance, permit, treaty, rule, regulation, law, or common law interpretation of any law applicable to a party; (b) bulletin, judgment, order, decree, injunction, request, recommendation, direction, guidance, examination, or determination of any Regulatory Authority with jurisdiction or authority over a party; or (c) any negotiated settlement, order or agreement by a party with an arbitrator or a Regulatory Authority.
“Audit Materials” is defined in Section 2.b — Program Operation.
“Auditing Party” is defined in Section 2.b — Program Operation.
“Bank Partners” means the one or more banks that we work with to facilitate the Program, including, but not limited to, for card issuing and ACH services.
“Cardholder” means a Person to whom a payment card or payment card number is issued pursuant to the Program.
“Commercial Rules” means the AAA’s Commercial Arbitration Rules and Mediation Procedures, and is defined in Section 4.h— Dispute Resolution and Binding Arbitration.
“Confidential Information” means any computer programs, technical drawings, algorithms, know-how, formulas, processes, ideas, inventions (whether patentable or not), technology, finances, customers, plans, product developments, unannounced products and services, forecasts, strategies, Program Data, transaction Data, Cardholder data, personal data, the terms of this Agreement, and any other data or information, oral or written (electronic, digital, or otherwise), that relates to our or our affiliates’ business activities.
“Data Security Program” is defined in Section 3.b.1 — Data Security Program Section.
“Dispute” is defined as any claim, controversy, or dispute between you and us, our processors, Bank Partners, suppliers or licensors (or their respective affiliates, agents, directors or employees), including any claims relating in any way to this Agreement, the Services or any other aspect of our relationship.
“Force Majeure Event” is defined in Section 4.q — Force Majeure.
“Indemnified Parties” is defined in Section 4.d — Indemnification.
“Insolvency Event” means a set of circumstances pursuant to which you (a) are unable to perform under this Agreement and becomes or is declared insolvent, is unable to pay its debts as they fall due or admits inability to pay its debts, or is the subject of any liquidation or insolvency proceedings, including the appointment of a receiver or similar officer for you or your business; (b) makes an assignment for the benefit of all or substantially all its creditors; (c) enters into an agreement for the composition, extension, or readjustment of all or substantially all its debts or obligations; or (d) files a voluntary bankruptcy or insolvency petition, application or order, or has an involuntary bankruptcy or insolvency petition, application or order filed against it and such involuntary petition is not dismissed within 60 days of the petition's filing.
"Intellectual Property" or "IP" means a party’s rights in all original, divisional, continuation, continuation-in-part, extensions, foreign applications, utility models and re-issues of patents; patent applications; copyrights, copyright applications and registrations, trade secrets, service marks, trademarks, trademark applications; moral rights and all other proprietary and intellectual property rights.
"Mastercard" means MasterCard Incorporated, MasterCard Worldwide, Inc., and MasterCard International Incorporated.
"Payment Network" means (a) Visa Inc. (b) Mastercard Incorporated, Mastercard Worldwide, Inc., and Mastercard International Incorporated, (c) American Express, (d) JCB Co., Ltd. (e) Discover Financial Services and Diners Club International, (f) China UnionPay and UnionPay International; (g) the Automated Clearing House; (h) the Society for Worldwide Interbank Financial Telecommunication; (h) the ClearingHouse LLC; (i) the operators of one or more ATM debit networks; and (j) any similar entity, organization, affiliation or association, or any future affiliate or successor of any such entity that (i) operates a payment network; or (ii) promulgates and enforces the operating rules and regulations of a payment network.
"Person" means a natural person, company, partnership, sole proprietorship, joint venture, incorporated or unincorporated entity, or any other form of entity, with or without a separate legal personality.
"PCI DSS" means the Payment Card Industry Data Security Standard, or any successor requirements, as each may be amended or otherwise modified from time to time.
"Program" means the card program operated by us and marketed by you, as defined in Section 1.c — Program Management.
"Program Data" means cardholder data, transaction data, underwriting and risk management data, card fees, pricing, discounts, rebates, offers, promotions, and all other information collected or generated by either party in connection with a Cardholder’s use of the services.
"Regulatory Authority" means any of the following with apparent authority that asserts such apparent authority over this Agreement or either party: (a) a country, state, county, city, town, borough, village, district or other jurisdiction; (b) a federal, state, local, municipal, non-United States or other government; (c) a governmental authority of any nature (including any agency, branch, department, board, commission, court, tribunal or other entity); (d) a multinational organization or body; (e) a body exercising any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power, including a self-regulatory body; or (f) an official of any of the entities listed in this paragraph; but which does not include the Payment Networks.
"Rules" means the bylaws, operating rules and regulations of any applicable Payment Network, including the PCI-DSS.
"Security Incident" is defined in Section 3.b.iv — Notice of Security Incidents.
"Sensitive Authentication Data" has the meaning provided in the PCI standards.