Exhibit
10.21


 






*** Where this marking appears through this Exhibit 10.21,
information has been omitted pursuant to a request for confidential treatment;
a complete copy of this agreement has been filed separately with the Securities
and Exchange Commission.


 


CARD PROGRAM MANAGEMENT AGREEMENT


 


This
Card Program Management Agreement (the “Agreement”)
dated as of February 1, 2010 is entered into by and between Skylight Financial, Inc. whose address is 1455 Lincoln
Parkway, Suite 600, Atlanta, Georgia 30346 (“Program
Manager”) and MetaBank, dba Meta Payment
Systems, whose address is 5501 S. Broadband Lane, Sioux Falls, South
Dakota 57108 (“Bank”) (each of Bank and
Program Manager, a “Party” and collectively, the “Parties”).


 


WHEREAS, Bank is a federally-chartered savings association,
a member of Visa, MasterCard, Discover and various other card associations and
electronic payment networks, and, among other things, issues prepaid cards and
establishes settlement accounts for the settlement of card transactions;


 


WHEREAS, Bank has developed, and shall continue to develop,
various prepaid card programs, under which it shall issue fixed and variable
denomination, reloadable and non—reloadable prepaid cards, as well as a series
of card—related products and services in conjunction therewith;


 


WHEREAS, Program Manager is in the business of marketing and
distributing prepaid cards and can provide services, either directly or through
subcontractors, to support prepaid card programs; and


 


WHEREAS, Bank desires to engage Program Manager to provide
certain program management services in connection with the Program as further
described herein, including, without limitation, the exclusive marketing and
distribution of the Cards issued by Bank under the Card Programs contemplated
herein, and Program Manager wishes to provide such services as set forth
herein;


 


NOW, THEREFORE, in consideration of the premises and mutual
covenants set forth herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties, intending
to be legally bound, hereby agree as follows:


 


ARTICLE I — DEFINITIONS


 


SECTION 1.1
— Definitions


 


Except
as otherwise specifically indicated, the following terms shall have the
following meanings in this Agreement (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):


 


“ACH Transactions” has the meaning
set forth in Section 4.7(c).


 


“Affiliate” means, with respect to
any Person, any other Person that directly or indirectly Controls, is
Controlled by, or is under common Control with such Person.


 


“Applicable Law” means (i) System
Rules, (ii) any applicable rule or requirement of the National
Automated Clearinghouse Association, (iii) the published policies and
procedures of Bank, as promulgated by Bank’s Board of Directors in good faith
to ensure the continued safety and soundness of Bank, and (iv) any and all
laws, treaties, rules, regulations, regulatory guidance, determinations of (or
agreements with) an arbitrator or governmental agency or authority and
mandatory written direction from (or agreements with) any arbitrator or
governmental agency or authority, including, without limitation, the Bank
Secrecy Act, any and all sanctions or regulations enforced by OFAC, and statutes
or regulations of any state relating to gift cards, money transmission or
unclaimed property, that are applicable to the marketing, issuance, sale,
authorization or usage of the Cards, or otherwise applicable to any of the
Parties by law or made applicable to any Party as specifically provided for in
this Agreement, as the same may be amended and in effect from time to time
during the Term.


 

















 






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“ATM” means automated teller
machine.


 


“BIN” means the bank identification
number assigned to Bank by Visa U.S.A., Inc., the Interbank Card
Association number assigned to Bank by MasterCard International, Inc., the
Institution Identification Number assigned to Bank by Discover Network, Inc.,
or similar identifier assigned to Bank by other card associations or payment
systems for the purposes of identifying and routing electronic payment
transactions.


 


“Business Day” means any day
other than a Saturday, Sunday or holiday recognized by the Federal Reserve
Board.


 


“Card” means a reloadable or non—reloadable
prepaid card or other access device issued by Bank as a product of the Bank in
connection with a card program managed by the Program Manager, and pursuant
both to this Agreement and under authority from the System.  For purposes of this Agreement, a “Card” does
not include any credit card or product that accesses credit.


 


“Card Program Account Manager” has
the meaning set forth in Section 4.6.


 


“Cardholder” means (i) a
person who is issued a Card, and/or (ii) uses the Card to effect a
Transaction.


 


“Cardholder Account” has the meaning
set forth in Section 4.4.


 


“Cardholder Agreement” means a
written agreement between Bank and the Cardholder, which includes (i) the
terms and conditions applicable to such Card, and (ii) any other notices
or documents related to such Card as may be required by Bank or Applicable Law,
including, but not limited to, those disclosures required under the Electronic
Fund Transfer Act, 15 USC § 1693 et seq., and Regulation E.


 


“Cardholder Data” means any
data or information of any Cardholder that is provided to or obtained by any
Party in the performance of its obligations under this Agreement or otherwise,
including but not limited to, all lists of Cardholders, former Cardholders, and
all information relating to and identified with such Cardholders, including,
but not limited to account transaction and balance data, and “non—public
personal information” as defined by the Gramm-Leach-Bliley Act and its
implementing regulations, as amended, including but not limited to postal and e—mail
addresses and associated data (including any personally identifiable
information, personal account information, financial information, account
numbers, personal identification numbers and other related information, social
security numbers, or other non—public business or personal or financial
information) provided by the Cardholders to any Party.


 


“Cardholder Funds” means those
funds which have been received from or on behalf of a Cardholder for purposes
of being loaded to a Card, but which have not yet been redeemed.


 


“Change of Control” means, with
respect to any Person, (i) an acquisition of the voting control of such
Person (i.e., the ability to elect a majority of the members of the Board of
Directors or similar governing body of such Person) by another entity or group
(as such term is defined in Rule 13d-5 under the Securities Exchange Act
of 1934, as amended) by means of any transaction or series of transactions
(including, without limitation, any reorganization, merger or consolidation) or
(ii) a sale of all or substantially all of the assets of such Person to
any entity or entities in which the equityholders of such Person, directly or
indirectly, do not have voting control (i.e., the ability to elect a majority
of the members of the Board of Directors or similar governing body of such
entity).


 


“Claim” has the meaning set forth in Section 14.1.


 


“Confidential Information” has the
meaning set forth in Section 11.1


 


“Customer Care Center” has the
meaning set forth in Section 3.5.


 


“Discloser” has the meaning set forth
in Section 11.1.


 


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“Dispute” has the meaning set forth
in Section 14.4.


 


“***”
has the meaning set forth in Section 10.2(e).


 


“Effective Date” has the meaning set
forth in Section 10.1.


 


“GLBA” means, collectively,
Title V — Privacy of the Gramm—Leach—Bliley Act, P.L. 106—102, the Privacy
Regulations and implementing regulations promulgated thereunder, and the standards
for safeguarding customer information set forth in 12 CFR Part 364 and 16
CFR Part 314, all as they may be amended, supplemented and/or interpreted
in writing from time to time by any federal Regulatory Authority.


 


“Gross Dollar Volume” has the
meaning set forth in Section 2.1(b).


 


“Guidelines” means the Interagency
Guidelines Establishing Standards for Safeguarding Customer Information.


 


“Indemnified Party” has the meaning
set forth in Section 14.1.


 


“Indemnifying Party” has the meaning
set forth in Section 14.1.


 


“Interchange” means the fee
paid to the issuer of a Card by a System in connection with a Transaction.


 


“Initial Term” has the meaning set
forth in Section 10.1.


 


“Mark” means the service marks and
trademarks of a Bank, Program Manager or a System, including but not limited
to, the names and other distinctive marks or logos, which identify Bank,
Program Manager or a System.


 


“Material Adverse Change” means, with
respect to either Party, an event, change or occurrence which, individually or
together with any other event, change or occurrence, has a material adverse
impact on the ability of such Party to perform its obligations under this
Agreement.


 


“Monthly System Fees” has the meaning
set forth in Section 8.2(d).


 


“***” has the meaning set forth in Section 2.1(b).


 


“NetSpend” means NetSpend
Corporation, a Delaware corporation.


 


“NetSpend ODFI Agreement” means the
ODFI Originator Agreement, dated as of January 30, 2009, by and between
NetSpend and Bank, as amended and/or restated from time to time.


 


“Nonreloadable Card” means a Card
issued under a Program that is a fixed denomination, non—reloadable Card.


 


“OFAC” has the meaning set forth in Section 4.3.


 


“OTS” means the Office of Thrift
Supervision.


 


“Person” means an individual,
corporation, partnership, limited liability company, limited liability
partnership, syndicate, trust, association, organization or other entity, or
any governmental authority.


 


“Processing Services” means those
services which are necessary to issue and service a Card and process a
Transaction in accordance with Applicable Law.


 


“Program” means a system of services
as mutually agreed by Program Manager and Bank and provided by Program Manager
and Bank pursuant to the terms of this Agreement under which Cardholders
subject to a Cardholder Agreement for such Program utilize a Card to submit
Transactions into a System utilizing a Settlement Account established by Bank
to access Cardholder Funds. This Agreement contemplates that Program Manager
may be permitted by Bank to offer multiple Programs 


 


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hereunder, each subject to the terms hereof and the prior written
approval of Bank.


 


“Program Affiliate” means a
party with whom Program Manager contracts for the purpose of marketing the
Cards, including, without limitation, (i) entities that Program Manager
contracts for the purpose of marketing the Cards to employees and/or
independent contractors of such entities (“Employers”),
and (ii) entities that Program Manager contracts for the purpose of
referring Employers to Program Manager (including referral companies and
financial institutions) (“Referral Companies”).


 


“Program Revenue” means all
income derived from a Cardholder’s use of a Card or participation in a Program,
net any amounts payable to Program Affiliates.


 


“Program Telephone Numbers and Websites” has the
meaning set forth in Section 10.3(c).


 


“Recipient” has the meaning
set forth in Section 11.1.


 


“Regulation E” means 12 CFR Part 205
and its successor provisions.


 


“Regulatory Authority” means,
as the context requires, any System, the National Automated Clearing House
Association, and any federal or state agency having jurisdiction or regulatory
powers over Bank, Program Manager, the Cards or a Program.


 


“Reloadable Card” means a Card
issued under a Program which allows a Cardholder to add additional funds to
such Card following the initial sale and loading of such Card.


 


“Renewal Term” has the meaning set
forth in Section 10.1.


 


“Settlement” means the movement and
reconciliation of funds between Bank and System members in accordance with the
System Rules to settle Transactions.


 


“Settlement Account” means the
account maintained by Bank used for Settlement of all Transactions initiated by
use of a Card(s) by or on behalf of a Cardholder.


 


“Skylight ABA Number” has the meaning
set forth in Section 4.7(b).


 


“Solicitation Notice” has the meaning
set forth in Section 2.1(c).


 


“Successor Bank” has the meaning set
forth in Section 10.3.


 


“Switchover Date” has the meaning set
forth in Section 10.3.


 


“System” means Visa U.S.A., Inc.,
MasterCard International, Inc., Discover Network, Inc., American
Express Travel Related Services Company, Inc., or any other card network
selected by Bank and agreed to by Program Manager.


 


“System Rules”  means the bylaws, operating rules and
regulations of System or any other card association operating a payment network
which is utilized by any Party hereto for the purposes of fulfilling such Party’s
obligations hereunder.


 


“Term” has the meaning set forth in Section 10.1.


 


“Third
Party Program Manager” means a third party program manager of
prepaid cards or other payment devices issued by Bank.


 


“Third
Party Processor” a third party that serves as processor with respect
to prepaid cards or other payment devices issued by Bank.


 


“***” has the meaning set forth in ***.


 


“***” has the meaning set forth in ***.


 


“Transaction” means using a
Card to: (i) make a purchase; (ii) obtain a credit for a previous
purchase; (iii) obtain cash from a an ATM; (iv) make a bill payment
or other payment to a third party; or (v) engage in any other activity
which may positively or negatively impact the balance of Cardholder 


 


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Funds
associated with such Card.


 


“Transition Period” means the
period commencing on the termination or expiration of this Agreement and
continuing for three hundred sixty five (365) calendar days, unless, to the
extent permitted by Applicable Law, such longer period is required for Program
Manager to (i) sell all remaining Cards in its inventory which contain
Bank’s Marks or (ii) complete the transfer of the Cards and Program(s) to
a Successor Bank or the wind-down of the Program(s) pursuant to Section 10.3,
in which case such period shall extend to such date that such items are
completed.


 


“U.S. Bank” means U.S. Bank
National Association.


 


“U.S. Bank Programs” means the
prepaid card programs of U.S. Bank with respect to which Program Manger serves
as the program manager.


 


“Well-Capitalized Institution”
has the meaning set forth in Section 6.2(e).


 


ARTICLE II — GENERAL
DESCRIPTION OF PROGRAMS


 


SECTION 2.1 — Appointment of Program Manager


 


(a)                                  Bank hereby (i) appoints
Program Manager as its authorized delegate and representative to (A) assist
Bank in the development and marketing of the Program(s), (B) market and
sell Cards on behalf of Bank that meets Bank requirements, and (C) perform
services that are necessary or appropriate to support the Cards and Program(s),
solely in accordance with the terms of this Agreement; and (ii) grants
Program Manager the right to offer the Cards for sale on behalf of Bank.  Bank further appoints Company as its agent or
authorized delegate, as the case may be, for the purpose of compliance with
state money transmitter statutes and the Bank Secrecy Act.


 


(b)                                 Subject to Section 3.1(a),
Bank agrees to reasonably cooperate with Program Manager in the execution of
such agreements or provision of such extensions of agency, commitments,
assurances, references or such other similar items as may be requested by
Program Manager or required under Applicable Law or by any Regulatory Authority
for Program Manager and any Program Affiliate to market the Cards in any state
or territory of the United States or otherwise perform their respective
obligations hereunder, unless otherwise prohibited by Bank’s charter
restrictions, Applicable Law or any Regulatory Authority directive.


 


(c)                                  So long as
Program Manager is an Affiliate of NetSpend, Bank will use its commercially
reasonable efforts to promote and recommend Program Manager as a preferred
program manager and processor for payroll card programs with respect to which
Bank will serve as the issuing bank. 
Without limiting the generality of the foregoing:


 


(i)                                     Bank will not
directly solicit any current or prospective Program Affiliate to enter into any
agreement or other relationship with Bank or any Third Party Program Manager or
Third Party Processor pursuant to which Bank or such Third Party Program
Manager or Third Party Processor would directly (A) provide program
management and/or processing services to such Program Affiliate or (B) market,
distribute and/or reload payroll cards through such Program Affiliate.


 


(ii)                                  Bank further
agrees to promptly notify Program Manager in the event that any Program
Affiliate as of the Effective Date solicits Bank to provide program management
and/or processing services for such Program Affiliate in connection with the
marketing, distribution and/or reload of payroll cards that could reasonably be
construed to compete with Cards or the 


 


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Program
(a “Solicitation Notice”), unless Bank
is prohibited from providing such notice by a nondisclosure agreement entered
into by and between Bank and such Program Affiliate prior to July 1,
2009.  Bank shall not enter into a
nondisclosure agreement with an entity that is a Program Affiliate as of the
Effective Date unless such nondisclosure agreement allows Bank to provide a
Solicitation Notice to Program Manager in accordance with the immediately
preceding sentence.


 


(d)                                 Program Manager
will use its commercially reasonable efforts to promote Bank as a preferred
issuing bank and sponsor for payroll card programs with respect to which
Program Manager serves as program manager and processor.


 


(e)                                  On a monthly
basis (or such other period as the Parties may agree), the Parties will meet in
good faith by telephone or otherwise as mutually agreed (each, a “Prospect Meeting”) to discuss the
origination, and the status of the engagement of, of Prospects and Program
Manager Prospects.


 


ARTICLE III - DUTIES OF PROGRAM MANAGER


 


SECTION 3.1
— Marketing


 


(a)                                            Program Manager
shall, in accordance with Bank’s policies and procedures as communicated to
Program Manager by Bank, select the entities to participate in the Program as
Program Affiliates.  Program Manager is
hereby authorized to enter into agreements with each Program Affiliate which
sets forth the terms by which such Program Affiliate shall be compensated for
its services related to the Program.  The
Parties acknowledge and agree that prior to any Program Affiliate offering the
Cards for sale, or distributing the Cards, if in its sole discretion Bank
approves of such Program Affiliate, which approval will not be unreasonably
withheld or delayed.


 


(b)                                 Program Manager
shall develop Programs and promote and market Cards and Programs to prospective
Cardholders in accordance with the Bank’s instructions and the terms of this
Agreement.  Program Manager acknowledges
and agrees that Bank may require Program Manager to suspend the use of any
Program marketing materials and the issuance of Cards in a Program as may be
necessary to comply with Applicable Law or any change in a Regulatory Authority’s
interpretation of Applicable Law; provided, however, that in such event, Bank
and Program Manager will agree to an implementation process that enables
Program Manager to utilize any existing inventories of such materials to the
extent practicable and allowable under Applicable Law and System Rules.


 


SECTION 3.2 — Printing of Cards and Cardholder Agreements


 


(a)                                  The terms and
conditions contained in the Cardholder Agreements, including any applicable
fees charged with respect to all Cards issued hereunder, shall be determined by
Bank, in consultation with Program Manager, and may be amended by Bank from
time to time, in consultation with Program Manager, upon such notice to each
Cardholder as required by Applicable Law. 
Program Manager shall develop and submit to the Bank for final review
and approval one or more proposed Card designs and proposed terms of the
Cardholder Agreement for each Program. 
From time to time, Program Manager may submit additional or alternative
Card designs and Cardholder Agreements for each Program.


 


(b)                                 Bank shall be
the contracting party under all Cardholder Agreements, and shall enter into a
Cardholder Agreement with each Cardholder. 
During the Term, the relationship with each Cardholder shall be owned by
Bank.  All Cards, Cardholder Agreements
or other Program materials, including, without limitation, all marketing
materials, shall (i) identify the Bank as the issuing bank of the Cards, (ii) include
any such names, Marks, and disclosures as may be required to conform to Graphic
Standards and 


 


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Applicable Law, and (iii) be subject to prior approval by Bank and
System prior to use.  Bank shall review
and approve or reject, with such approval not to be unreasonably withheld or
delayed, those Cardholder Agreements and Program materials proposed by Program
Manager, and obtain System approval where such approval is required under the
System Rules to implement the use of such proposed Cardholder Agreements
or Program materials, within a reasonable amount of time following receipt of
the same from Program Manager.


 


(c)                                  Program Manager
shall arrange and pay for production and delivery of the Cards, Card packaging,
informational disclosures, marketing materials and Cardholder Agreements;
provided, however, that Bank shall be responsible for any costs associated with
any changes to the Cards, Card packaging, informational disclosures, marketing
materials and Cardholder Agreements required by Bank, which are not required by
Applicable Law or any change in a Regulatory Authority’s interpretation of
Applicable Law.  In the event of any
modification to the Cards, Card packaging, informational disclosures, marketing
materials or Cardholder Agreements, Bank and Program Manager will agree to an
implementation process that enables Program Manager to utilize any existing
inventories of such materials to the extent practicable and allowable under
Applicable Law and System Rules.


 


SECTION 3.3 — Processing Services


 


Program Manager, at its sole expense, shall provide for Processing
Services. Any processor retained by Program Manager to provide Processing
Services must be approved in advance by Bank, and must have executed a
Processing Services agreement with Bank. 
A list of pre-approved processors may be obtained from Bank, upon
Program Manager’s request. All Processing Services related to the Programs
shall be provided pursuant to that certain Processor Servicing Agreement, dated
as of the date hereof, between Bank and Program Manager (“Processing
Agreement”), or as otherwise mutually agreed by the
Parties.  In the event of any conflict
between this Agreement and the Processing Agreement, the terms of this
Agreement shall control to the extent of such conflict.


 


SECTION 3.4 — Accounting


 


Program Manager shall be responsible for all
accounting related to the Cards.  The
Parties agree that all accounting calculations relating to this Agreement will
be performed in accordance with generally accepted accounting principles in the
United States.  The Parties further agree
to work together in good faith to reconcile any accounting discrepancies.


 


ARTICLE IV - DUTIES OF BANK


 


SECTION 4.1
— Memberships in System


 


Bank, as a principal member of System, shall support the sponsorship
and registration of Program Manager as a marketing agent or service provider of
Bank with each System, as applicable. However, the Parties hereto acknowledge
and agree that Program Manager assumes all risk that the Program Manager or any
Program may not be approved by any System. 
Bank will promptly provide to Program Manager copies of all
correspondence and forms relating to any Program which are submitted to or
received from any System.   Bank
acknowledges and agrees that Program Manager is entitled to enter into
arrangements with the Systems pursuant to which the Systems agree to provide
Program Manager with incentives to market and promote System-branded Cards and
that Bank has no right to any portion of such incentives.


 


SECTION 4.2
— Assessment, Development and Approval of Programs


 


(a)                                  Bank shall work closely with Program Manager to develop Programs that
meet Bank’s strategic objectives and customer goals.  Any Programs proposed by Program Manager
shall be reviewed 


 


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and assessed by Bank, and shall be promptly approved
or declined in Bank’s sole discretion. Bank shall work diligently with Program
Manager to implement any approved Programs.


 


(b)                                 Subject to Applicable Law, including applicable Regulatory
Authority restrictions, and the sole discretion of Bank, Bank will use commercially reasonable efforts
to support such products and features proposed by Program Manager and approved
by Bank with respect to any Program, including, without limitation, convenience
check functionality.


 


SECTION 4.3
— Issuer of Cards and Approval of Cardholders


 


Bank shall sponsor one or more BINs for the Cards and will maintain one
or more Programs whereby it is the issuer of all Cards marketed and distributed
by Program Manager pursuant to this Agreement and in accordance with Applicable
Law.   In addition, with respect to Programs
that establish an ongoing relationship with the Cardholder, Bank shall review
customer information regarding each such Cardholder, and shall be responsible
for ensuring that each such Cardholder meets Bank’s Customer Identification
Program as required by Applicable Law. 
Bank will also regularly screen all Cardholders through Bank’s screening
system implemented to comply with Applicable Law, including, without
limitation, any and all regulations enforced by the U.S. Department of Treasury’s
Office of Foreign Assets Control (“OFAC”).


 


SECTION 4.4 — Remittance and Handling of Cardholder Funds;
Settlement


 


(a)                                  All Cardholder
Funds shall be held in a pooled custodial account in which Bank shall hold all
Cardholder Funds in a fiduciary or custodial manner for the benefit of
Cardholders, in accordance with Applicable Law (the “Cardholder
Account”).


 


(b)                                 Company and
Bank acknowledge and agree that (i) all Cardholder Funds shall be held in
trust for the benefit of the Cardholders, (ii) neither Bank nor Company
have an equitable interest in the Cardholder Funds, and (iii) the
Cardholder Funds will not be used for any other purpose.  Bank shall transfer Cardholder
Funds from the Cardholder Account to Settlement Accounts in an amount adequate
to facilitate Settlement with the System on a daily basis or as otherwise
determined by Bank.  The Parties
acknowledge and agree that Bank shall be responsible for compliance with state
unclaimed property laws as they relate to the Cards and Cardholder Funds.


 


(c)                                  With respect to
all Reloadable Cards, Bank shall structure the Cardholder Account in a manner
sufficient to allow for pass-through federal deposit insurance coverage under
Federal Deposit Insurance Corporation regulations.  Program Manager shall be responsible for maintaining
accurate books and records of Cardholders and Cardholder Funds that are
sufficient under Applicable Law, including, without limitation, 12 CFR § 330.5,
to permit the Cardholder Funds associated with Reloadable Cards to qualify for
pass-through federal deposit insurance coverage.


 


(d)                                 Bank shall
provide for and facilitate Settlement of Card Transactions for all Cards issued
by Bank.  To facilitate such Settlement,
Bank has established or will establish one or more Settlement Account(s) owned
by Bank.  To reflect such Settlement,
Bank shall update its account records with respect to the Cardholder Account on
each Business Day to reflect all such Settlement activity pursuant to
information provided by Program Manager. 
If necessary, Bank shall enter into an inter-bank settlement agreement
with one or more financial institutions issuing stored value cards pursuant to
any card program managed by Program Manager to facilitate settlement of
transactions effected by Bank’s Cardholders and those of such financial
institution(s).


 


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SECTION 4.5 — Customer Service Standards


 


Bank shall develop, or cause Program Manager to develop with Bank’s
approval, customer service standards for servicing that are designed to promote
customer satisfaction and to promote the preservation and growth of the
customer base.  Bank may require
additional customer service standards; if the Bank receives any guidance,
complaints or comments from any Regulatory Authority or System or is required
to do so by Applicable Law, Bank, in its sole discretion, shall cause the
Program Manager to alter or amend such customer service standards as necessary.


 


SECTION 4.6
— Bank Support


 


Within ten (10) Business Days after the Effective Date, the Bank will
designate one of its employees as the “Card Program Account
Manager.”  The Card
Program Account Manager will serve as the single point of contact for Bank with
respect to the Program(s) and will have day—to—day authority for
undertaking to ensure Bank fulfills its obligations hereunder in a timely
manner.  The Card Program Account Manager
will be responsible for ensuring that all proposed Programs and Program changes
are promptly reviewed and approved, or, if not approved, declined with notice
detailing the reasons why.


 


SECTION 4.7
— Transition of U.S. Bank Programs; Skylight ABA Number


 


(a)                                  Bank agrees to
use commercially reasonable efforts to effect a smooth and orderly transition
of the U.S. Bank Programs to Bank by July 1, 2010.


 


(b)                                 With respect to
the transition of the U.S. Bank Programs to Bank, Bank’s obligations under Section 4.7(a) will
include, except where prohibited by Applicable Law: (i) accepting the
transfer to Bank of all cardholder funds on deposit at U.S. Bank with respect
to the U.S. Bank Programs, (ii) assuming all of U.S. Bank’s rights, duties
and obligations with respect to all U.S. Bank Program prepaid cards, cardholder
agreements and cardholder data, effective as of the transfer date, provided,
however, for the sake of clarity, that the obligations and liabilities assumed
by Bank shall not include any of U.S. Bank’s obligations and liabilities that
arose prior to the transfer date, (iii) making any and all regulatory
filings necessary to effect the transition of the U.S. Bank Programs to Bank, (iv) making
all filings and taking all other actions necessary to effect the transfer by
U.S. Bank of the related BINs and an ABA routing and transit number to Bank
(the “Skylight ABA Number”), (v) executing
and delivering, if necessary or appropriate, an account transfer agreement
containing terms and conditions generally consistent with banking industry
practice for the transfer of accounts between institutions, and (vi) executing
such other documents as may reasonably be necessary or appropriate for Bank to
effect the transition of the U.S. Bank Programs to Bank.


 


(c)                                  Bank will
maintain the Skylight ABA Number at all times during the Term exclusively for
the Program and any prepaid card program with respect to which NetSpend serves
as program manager and processor.   Bank
will provide Fedline terminal access to Program Manager and NetSpend that will
allow Program Manager and NetSpend to process Automated Clearing House
transactions (“ACH Transactions”) using the
Skylight ABA Number, and the Parties acknowledge and agree that such ACH
Transactions will not be subject to, and will not constitute “Transactions” for
purposes of, the NetSpend ODFI Agreement or any agreement Program Manager
enters into with Bank for the processing of ACH Transactions.


 


ARTICLE V - REPRESENTATIONS
AND WARRANTIES OF PROGRAM MANAGER


 


SECTION 5.1
— Program Manager Representations and Warranties


 


Program Manager represents and warrants to Bank as follows:


 


(a)                                  Program Manager
is a corporation duly incorporated, validly existing and in good 


 


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standing
under the laws of Delaware and is authorized to conduct business as defined
within the Agreement in each state in which the nature of Program Manager’s
activities hereunder makes such authorization necessary.


 


(b)                                 Program Manager
has the full power and authority to execute and deliver this Agreement, to
perform all its obligations under this Agreement and other agreements which
must be executed to effect the services contemplated herein.  The provisions of this Agreement and the
performance by Program Manager of its obligations under this Agreement are not
in conflict with the Program Manager’s certificate of incorporation, bylaws or
any other organizational document, agreement, contract, lease or obligation to
which Program Manager is a party or by which it is bound.


 


(c)                                  Except as
otherwise disclosed, neither Program Manager nor any principal of Program
Manager has been subject to the following:


 


(i)                                     Criminal
conviction (except minor traffic offenses and other petty offenses);


 


(ii)                                  Any unpaid
Federal or state tax lien;


 


(iii)                               Administrative or
enforcement proceedings commenced by the Securities and Exchange Commission,
any state securities regulatory authority, Federal Trade commission, federal or
state bank regulator, or any other state or federal regulatory agency; or


 


(iv)                              Restraining order, decree,
injunction, or judgment in any proceeding or lawsuit, alleging fraud or
deceptive practice on the part of Program Manager or any principal thereof.


 


For
purposes of this subparagraph, the word “principal” shall include (x) any
person directly or indirectly owning ten percent (10%) or more of Program
Manager, (y) any officer or director of the Program Manager, or (z) any
person actively participating in the control of Program Manager’s business.


 


(d)                                 There is not
pending, or to Program Manager’s actual knowledge threatened, against Program
Manager any litigation or proceeding, judicial, tax or administrative, the
outcome of which could reasonably be expected to have a Material Adverse Effect
with respect to the continuing operations of Program Manager.


 


(e)                                  Program Manager
has, on or prior to the Effective Date, delivered to Bank complete and correct
copies of its most recent balance sheets and related statements of income and
cash flow.  Program Manager’s financial
statements, subject to any limitation stated therein, which have been or which
hereafter will be furnished to Bank will fairly represent the financial
condition of the Program Manager as of the date of such financial statements.


 


SECTION 5.2 — Bank Representations and
Warranties


 


Bank hereby warrants and represents to Program Manager as follows:


 


(a)                                  Bank is a
federally—insured financial institution validly existing, in good standing and
authorized to perform all activities contemplated by this Agreement.


 


(b)                                 Bank has the
full power and authority to execute and deliver this Agreement and to perform
all its obligations under this Agreement. 
The provisions of this Agreement and the performance by Bank of its
obligations under this Agreement are not in conflict with the Banks charter,
bylaws or any other organizational document, agreement, contract, lease or
obligation to which Bank is a party or by 


 


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which
it is bound.


 


(c)                                  Except as
otherwise disclosed, neither Bank nor any principal of Bank has been subject to
the following:


 


(i)                                     Criminal
conviction (except minor traffic offenses and other petty offenses);


 


(ii)                                  Any unpaid
Federal or state tax lien;


 


(iii)                               Administrative or
enforcement proceedings commenced by the Securities and Exchange Commission,
any state securities regulatory authority, Federal Trade commission, federal or
state bank regulator, or any other state or federal regulatory agency; or


 


(iv)                              Restraining order, decree,
injunction, or judgment in any proceeding or lawsuit, alleging fraud or
deceptive practice on the part of Program Manager or any principal thereof.


 


For
purposes of this subparagraph, the word “principal” shall include (x) any
person directly or indirectly owning ten percent (10%) or more of Bank, (y) any
officer or director of the Bank, or (z) any person actively participating
in the control of Bank’s business.


 


(d)                                 There is not
pending or threatened against Bank, any litigation or proceeding, judicial, tax
or administrative, the outcome of which might materially adversely affect the
continuing operations of Bank.


 


(e)                                  Bank’s deposits
are insured by the Federal Deposit Insurance Corporation to the full extent
permitted by Applicable Law, and no proceeding has been instituted to revoke
such insurance.


 


ARTICLE VI — COVENANTS


 


SECTION 6.1 — Covenants of Program Manager


 


Program
Manager covenants and agrees with Bank as follows:


 


(a)                                  Program Manager
will, not less than once each calendar year, provide Bank with a copy of
Program Manager’s updated balance sheet and related statements of income and
cash flow.


 


(b)                                 Program Manager
shall catalog and maintain copies of all written consumer complaints and
responses relating to the Card or its use which are received by Program
Manager.  Bank (i) shall have access
to such complaints and responses during Program Manager’s normal operating
hours, and (ii) may audit a reasonable number of such complaints.  Program Manager acknowledges that Bank will
institute a system for tracking and resolving consumer complaints involving
Cards and Programs hereunder in a timely manner and will provide an annual
report regarding consumer complaints and their resolution to the Bank’s board
of directors.


 


(c)                                  All material
written consumer complaints received by Program Manager relating to the Card or
its use will be reported to Bank as soon as reasonably practicable.  Any litigation or court proceedings filed
against Program Manager, relating to the Card or its use, will be immediately
reported to Bank.  Such report shall
include a copy of the court papers or proceedings, together with a summary of
the Program Manager’s position with respect to the matter, the name and address
of Program Manager’s counsel handling the matter, and the estimated likelihood
of settlement of such matter.


 


(d)                                 Program Manager
shall obtain Bank’s written approval prior to engaging in any oral or written
correspondence related to any Program with any Regulatory Authority having
jurisdiction over 


 


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Bank.


 


(e)                                  Program Manager
shall remain in good standing with (i) each Regulatory Authority with
jurisdiction over it, and (ii) each System or other electronic payment
network with which it may be registered from time to time as a marketing
representative, agent or service provider.


 


(f)                                    Program Manager
shall provide notice to Bank within a reasonable amount of time following the
occurrence of a Material Adverse Change with respect to Program Manager.


 


SECTION 6.2 — Covenants of Bank


 


Bank
covenants and agrees with Program Manager as follows:


 


(a)                                  Any litigation
or court proceedings filed against Bank, relating to the Card or its use, will
be immediately reported to Program Manager. 
Such report shall include a copy of the court papers or proceedings,
together with a summary of the Bank’s position with respect to the matter, the
name and address of Bank’s counsel handling the matter, and the estimated
likelihood of settlement of such matter.


 


(b)                                 Bank shall
promptly notify Program Manager after Bank engages in any written
correspondence related to any Program with any Regulatory Authority having
jurisdiction over Program Manager, and shall provide Program Manager with
copies of any such written correspondence unless such disclosure is prohibited
by Applicable Law.


 


(c)                                  Bank shall
remain (i) a federally-chartered, federally-insured financial institution,
and (ii) in good standing with (A) each Regulatory Authority with
jurisdiction over it, and (B) each System or other electronic payment
network which it may be a member of or registered with from time to time.


 


(d)                                 Bank shall
ensure that its deposits remain insured by the Federal Deposit Insurance
Corporation in accordance with Applicable Law.


 


(e)                                  Bank shall (i) maintain
sufficient capital to support its deposits and assets, (ii) remain a
well-capitalized institution, as defined under the prompt corrective actions
provisions of the Federal Deposit Insurance Act, 12 U.S.C. § 1831o and 12
C.F.R. Part 565 as enacted as of the Effective Date (a “Well-Capitalized Institution”),
provided, however, that the failure of Bank to remain a Well-Capitalized
Institution shall not constitute a breach of this Section 6.2(e)(ii) unless
such failure could reasonably be expected to have a material adverse impact on
the Program or Bank’s ability to perform its obligations hereunder, and (iii) provide
notice to Program Manager within a reasonable amount of time following the
occurrence of a Material Adverse Change with respect to Bank.


 


ARTICLE VII - COMPLIANCE


 


SECTION 7.1 — Bank Products


 


(a)                                   For the
avoidance of doubt, Bank and Program Manager hereby acknowledge and agree that (i) the
Cards are products of Bank, a federally—chartered financial institution, (ii) Program
Manager is Bank’s authorized delegate and program manager, to which Bank has
delegated specific responsibilities relating to the management of the
Program(s), including the marketing and sale of the Cards, (iii) that Bank
has established the Program(s), and the Program(s) will be subject to Bank’s
continued oversight and control, and (iv) Program Manager shall submit to
Bank’s oversight and control in connection with all aspects of the Program(s) to
the extent not otherwise expressly provided herein or agreed to by the Parties,
including but not limited to Program Manager’s performance of services
hereunder.  Bank shall review reports and financials from the Program(s), and shall
meet regularly with Program Manager, on at least an annual basis, to discuss
the results of the Program(s) (including any problems, losses or


 


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complaints, and any changes or modifications
that may be necessary to ensure the viability of the Program(s).


 


(b)                                  Program Manager
acknowledges that Bank has provided the Program Manager with information and
training designed to insure that Program Manager will be adequately educated
about the Bank’s products and services offered hereunder, including the
distinctions between insured and non-insured products, and relevant law that
may apply to the marketing, solicitation, and customer service activities
instituted on behalf of Bank hereunder. 
Program Manager further acknowledges that Bank will review and update
the training material on an annual basis and will take reasonable steps to
ensure that Program Manager receives training as needed.  Program Manager’s training records will be
made available for review by Bank’s Regulatory Authority.


 


(c)                                   Program Manager
acknowledges that Bank must adopt a compliance program to ensure adequate
monitoring, supervision, and control over the Program Manager and the
activities that the Program Manager performs on behalf of the Bank.  Such oversight includes ensuring Program
Manager’s anti-money laundering compliance programs are detailed, thorough, and
implemented accurately and fully.


 


SECTION 7.2 — Legal Compliance


 


(a)                                  Each Party agrees
that it will comply with the System Rules and Applicable Law in the
performance of its obligations hereunder.


 


(b)                                 Without
limiting subsection (a) above, the Parties acknowledge and agree that (i) Bank
may delegate all or a portion of its anti—money laundering compliance
obligations under Applicable Law, including, without limitation, the Bank
Secrecy Act, to Program Manager, and (ii) Program Manager shall develop,
implement and maintain an anti—money laundering compliance program, approved in
writing by Bank, which addresses such delegated obligations.


 


(c)                                  Program Manager
acknowledges the statutory authority of Bank’s federal regulator to regulate
and examine and take an enforcement action against the Program Manager with
respect to the activities performed by Program Manager as agent or
representative of the Bank.  Program
Manager further acknowledges that such Regulatory Authority (i) retains
the rights to (A) require that Bank obtain the Regulatory Authority’s
approval (or non-objection) before entering into a contractual arrangement with
Program Manager and (B) approve specific contractual language, and (ii) may
institute any other requirements or conditions relating to this Agreement that
the Regulatory Authority deems appropriate.


 


SECTION 7.3 — Audits and Regulatory Examinations


 


(a)                                  Program Manager
agrees to: (i) submit to any audit or examination of Program Manager’s
facilities, records, and personnel regarding the Program which may be required
by any auditing function of Bank or any Regulatory Authority or System with
audit and examination authority over Bank, to the fullest extent required by
such Regulatory Authority or System; (ii) promptly provide to Bank any
information that may be required by any auditor, Regulatory Authority or System
in connection with their audit or review of Bank or the Program(s) and
reasonably cooperate with such auditor, Regulatory Authority or System in
connection with such any audit or review; and (iii) promptly provide such
other information as Bank, System or any Regulatory Authority may from time to
time reasonably request with respect to the financial condition of Program
Manager.  Bank may, upon ten (10) Business
Days prior written notice, require an annual operational audit of Program
Manager’s operations to be performed during normal business hours by Bank or a
third party designated by Bank.


 


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Bank
shall be responsible for all costs and expenses associated any inspection,
audit or examination conducted pursuant to this subsection (a).   In the event that any audit or examination
under this Section 7.3(a) is initiated or required by any Regulatory
Authority or System, Bank and Program Manager will each be responsible for 50%
of all third-party costs and expenses associated with any such audit or
examination.  In the event that any audit
or examination under this Section 7.3(a) is initiated by Bank and is not
required by any Regulatory Authority or System, Bank will be responsible for
all costs and expenses associated with any such audit or examination; provided,
however, that if such audit or examination is being conducted as a result of a
Material Adverse Change with respect to Program Manager, Program Manager will
be responsible for all costs and expenses associated any such audit or
examination.


 


(b)                                 Bank agrees to (i) promptly
provide Program Manager any information that may be required by any auditor,
Regulatory Authority or System in connection with any inquiry directed to
Program Manager, or their audit or review of Program Manager and reasonably
cooperate with such auditor, Regulatory Authority or System in connection with
such any inquiry, audit or review; and (ii) promptly provide such other
information as Program Manager may from time to time reasonably request
relating to the Bank or the Program(s).  
With respect to clause (i) of the foregoing, Bank and Program
Manager will each be responsible for 50% of all third-party costs and expenses
associated therewith.  With respect to
clause (ii), Program Manager will be responsible for all costs and expenses
associated therewith; provided, however, that if request is made by Program
Manager a result of a Material Adverse Change with respect to Bank, Bank will
be responsible for all costs and expenses associated any such audit or
examination.


 


SECTION 7.4 — Access to Program Documents and Information


 


(a)                                   Bank shall at
all times have reasonable access to and have the right to make abstracts from
all information and documents it reasonably requires with respect to the
Program which may be in the control and possession of Program Manager,
including, but not limited to, information and documents concerning Program
revenues or transactions and agreements affecting the management and
administration of the Program(s), and any other books, accounts, data, reports,
papers, and computer records directly pertaining to the subject matter of this
Agreement.


 


(b)                                 Program Manager
will also provide to the Bank any other information requested by Bank in
accordance with industry or national banking standards as may be required, from
time to time by the System or Regulatory Authorities, to ensure that safe and
sound business practices are being followed concerning processing, Settlement
and income to the Bank.


 


ARTICLE VIII - COMPENSATION
AND EXPENSES


 


SECTION 8.1
— Expenses of Bank


 


Bank
shall be solely responsible for the following expenses:


 


(a)                                  Membership fees
related to Bank’s own membership in the System.


 


(b)                                 All fees, fines
and penalties assessed by any Regulatory Authority or System due to Bank’s
actions, inactions or omissions, except to the extent of any indemnification of
Bank by Program Manager as provided in Section 14.1.


 


(c)                                  Bank’s own
costs and overhead generated from its review, assessment and development of the
Program(s), and from its supervision and oversight of Program Manager and the
results of the 


 


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Program(s).


 


(d)                                 Compensation of
Program Manager for its services as set forth in Section 8.3.


 


(e)                                  Bank’s own
internal costs and expenses incurred in connection with maintaining the
Cardholder Accounts and, except as may be otherwise agreed herein, its own
internal monitoring of the Program(s).


 


(f)                                    Such other
services and expenses that Bank may deem necessary or appropriate for the
Program(s) and which are not the obligation of Program Manager hereunder.


 


SECTION 8.2
— Expenses of Program Manager


 


Program Manager shall be solely responsible for the following:


 


(a)                                  Advertising and
other expenses associated with the marketing of Cards to potential Cardholders.


 


(b)                                 All fees, fines
and penalties assessed by any Regulatory Authority or System (other than Bank)
due to Program Manager’s actions, inactions, or omissions. except to the extent
of any indemnification of Program Manager by Bank as provided in Section 14.1.


 


(c)                                  All System fees
including ATM interchange due, ISO registration fees, program BINs/IINs
fees, and transaction fees, assessed to the Bank daily shall be paid on a daily
pass through basis.


 


(d)                                 All System fees
assessed to the Bank monthly (the “Monthly System Fees”),
subject to Bank’s provision to Program Manager with the Monthly Statement of a
detailed invoice setting forth such amounts and explaining each such fee or
charge.


 


(e)                                  All expenses
associated with and losses resulting from over limit processing, Cardholder
fraud, value load processing, value load fraud and under floor limit processing
shall be paid on a daily basis.


 


(f)                                    Any fees
charged by a System in relation to Program Manager’s registration, as
applicable, as a marketing agent or service provider of Bank.


 


(g)                                 All expenses
associated with establishing and maintaining any accounts with, or receiving
services from, any financial institution providing Settlement and all expenses
in providing Bank with account balances.


 


(h)                                 All reasonable expenses
incurred in connection with Bank’s completion of a due diligence review of any
third party proposed by Program Manager to perform any of Program Manager’s
obligations hereunder, which shall not exceed Five Thousand Dollars ($5,000)
for any specific matter without the prior written approval of Program Manager.


 


(i)                                     All expenses associated with
Program Manager’s retention, oversight and supervision of a processor providing
Processing Services.


 


SECTION 8.3
— Compensation Payable to Program Manager


 


Program
Manager shall be entitled to the compensation as defined in Schedule A.


 


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ARTICLE IX - LIMITATION OF
LIABILITY


 


SECTION 9.1 — Limitation of Liability


 


NEITHER PARTY, NOR THEIR RESPECTIVE SUBSIDIARIES,
PARENTS OR AFFILIATES SHALL BE LIABLE TO THE OTHER PARTY TO THIS AGREEMENT OR
ITS SUBSIDIARIES, PARENT OR AFFILIATES, WHETHER IN CONTRACT, TORT, EQUITY OR
OTHERWISE, FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE
OR EXEMPLARY DAMAGES, INCLUDING LOST PROFITS (EVEN IF SUCH DAMAGES ARE
FORESEEABLE, AND WHETHER OR NOT ANY PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES), ARISING FROM OR RELATING TO THIS AGREEMENT, INCLUDING,
WITHOUT LIMITATION, THE WRONGFUL DEATH OR INJURY OF ANY PERSON.  NOTWITHSTANDING THE FOREGOING, THE
LIMITATIONS CONTAINED IN THIS SECTION 9.1 SHALL NOT APPLY TO ANY CLAIM
THAT (A) IS SUBJECT TO INDEMNIFICATION UNDER SECTION 14.1, (B) ARISES
OUT OF A BREACH OF CONFIDENTIALITY UNDER ARTICLE XI OR A BREACH OF
INFORMATION SECURITY UNDER ARTICLE XII, OR (C) WITH RESPECT TO ANY
PARTY, ARISES OUT OF SUCH PARTY’S GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR
FRAUD.


 


SECTION 9.2 — Disclaimer of Warranties


 


ALL SERVICES PROVIDED BY THE PARTIES HEREUNDER ARE PROVIDED ON AN “AS
IS” AND “AS AVAILABLE” BASIS, AND EXCEPT AS OTHERWISE EXPRESSLY SET FORTH
HEREIN, NEITHER PARTY, NOR THEIR RESPECTIVE AFFILIATES MAKES ANY
REPRESENTATIONS OR WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL WARRANTIES,
EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE, RELATING TO OR ARISING OUT OF
THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED WARRANTIES
ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.


 


ARTICLE X - TERM AND
TERMINATION


 


SECTION 10.1
— Term


 


The
term of this Agreement shall commence on February 1, 2010 (the “Effective Date”) and continue for
five (5) years (the “Initial Term”)
unless terminated earlier as provided below. 
After the Initial Term, the Agreement shall automatically extend for
additional periods of one year each (each, a “Renewal
Term”)(the Initial Term, collectively with any Renewal Terms,
the “Term”) unless either party
terminates this Agreement for any reason by providing written notice to the
other at least one hundred twenty (120) days prior to the commencement of the
next Renewal Term.


 


SECTION 10.2
— Termination of Agreement


 


(a)                                  Either Bank or
Program Manager shall have the right to terminate this Agreement upon
occurrence of one or more of the following events:


 


(i)                                     Failure by the
other Party to observe or perform, in any material respect, that Party’s
obligations to the other Party hereunder, so long as such failure is not due to
the actions or failure to act of the terminating Party, but only if the failure
continues for a period of (A) thirty (30) days after the non-performing
Party receives written notice from the other Party specifying the failure in
the case of a failure not involving the payment of money, or (B) ten (10) days
after the non-performing Party receives written notice from the other Party
specifying the failure in the


 


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case
of a failure to pay any amount then due hereunder; provided, however, that
either Party, in its sole discretion, may terminate this Agreement without such
a cure period if there is a repeated failure by the other Party to perform that
Party’s obligations hereunder in a manner that, in the aggregate, has a
material adverse impact on the terminating Party or the Program, so long as the
failure is not due to the actions or failure of the terminating Party.


 


(ii)                                  In the event
any financial statement, representation, warranty, statement or certificate
furnished to it by the other Party in connection with or arising out of this
Agreement is materially adverse to the terminating party and is untrue,
misleading or omits material information, as of the date made or delivered.


 


(iii)                               The other Party
(A) voluntarily or involuntary (and such involuntary petition or
proceeding is not dismissed within sixty (60) days) commences (or is the
subject of, as the case may be) any proceeding or filing any petition seeking
relief under Title 11 of the United States Code or any other Federal, state or
foreign bankruptcy, insolvency, liquidation or similar law, (B) applies
for or consents to the appointment of a receiver, trustee, custodian,
sequestrator or similar official for such party or for a substantial part of
its property or assets, (C) makes a general assignment for the benefit of
creditors, (D) commences the winding up or liquidation of its business or
affairs, or (E) takes corporate action for the purpose of effecting any of the
foregoing.


 


(iv)                              Upon any change
to or enactment of or change in interpretation or enforcement of any law or
regulation which would have a material adverse effect upon such Party’s ability
to perform its obligations or such Party’s costs/revenues with respect to the
Program(s), provided that the Parties cannot find a legally workable solution
to the change in law or regulation within a reasonable amount of time.


 


(v)                                    Violation of
any federal or state law relating to the performance of this Agreement
rendering any of the Parties unable to substantially perform this Agreement,
provided that the Parties cannot find a legally workable solution to avoid
violating the law or regulation within a reasonable amount of time.


 


(vi)                                 Upon direction
from any Regulatory Authority or System to cease or materially limit
performance of the rights or obligations under this Agreement.


 


(vii)                              In the event
that any Regulatory Authority requires the alteration of specific language
contained in this Agreement, or imposes other requirements or conditions
relating to this Agreement, which would have a material adverse effect upon
such Party’s ability to perform its obligations or such Party’s costs/revenues
with respect to the Program(s), provided that the Parties cannot find a legally
workable solution to alteration or imposition within a reasonable amount of
time.


 


(b)                                 Program Manager
may immediately terminate this Agreement in the event that Bank fails to
achieve the ratios set forth on Schedule B hereto as of the end of two (2) consecutive
calendar quarters.


 


(c)                                  Program Manager
may immediately terminate this Agreement in the event that Bank or MFG
undergoes a Change of Control, if such Change of Control has a material adverse
impact on the Bank’s or MFG’s ability to fulfill the obligations set forth in
this Agreement.  Notwithstanding the
foregoing, if Bank or MFG undergoes a Change of Control whereby Control is
assumed by a direct competitor of Program Manager, Program Manager may
immediately terminate this Agreement.


 


(d)                                 In the event
that ***, Program Manager may terminate this Agreement at any time after ***.


 


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SECTION 10.3 — Termination and Transition Assistance


 


(a)                                  With respect to
each Program terminated as a result of the expiration or termination of this
Agreement, Program Manager may elect to either transition such Program in
accordance with Applicable Law to an alternative card issuer pursuant to Section 10.3(b) or
wind down such Program in accordance with Applicable Law pursuant to Section 10.3(c).  Each Party acknowledges that the two goals of
the Transition Period are to benefit the Cardholders by minimizing any possible
burdens or confusion and to protect and enhance the names and reputations of
the Parties, each of whom have invested their names and reputations in the
Program(s) and Cards issued hereunder. 
Unless otherwise required by Applicable Law or any Regulatory Authority,
upon the expiration or termination of this Agreement for any reason, the
Parties agree to cooperate in good faith to wind down or transition all
affected Programs in a commercially reasonable way as soon as reasonably
possible to provide for a smooth and orderly transition or wind-down.  Such cooperation will include continued
acceptance of Cards presented for payment until such Cards expire or are
cancelled as set forth below, and continued provision of customer service to
all outstanding Cardholders in accordance with the terms of this Agreement up
until the Cards expire, are terminated, or transitioned to another bank or
financial institution.


 


(b)                                 With respect to
Programs that Program Manager elects to transition to another card issuer
pursuant to Section 10.3(a), Bank’s obligations pursuant to Section 10.3(a) will
include, without limitation:  (A) transferring
all Cardholder Funds on deposit at Bank to another federally-insured financial
institution designated by Program Manager, which institution shall assume
responsibility for all obligations and liabilities which arise after transfer
of the Program to a successor bank (such institution, a “Successor
Bank”) including those with respect to payment of the Cardholder
Funds to Cardholders and Settlement of Transactions with the appropriate
System(s), (B) assigning all of Bank’s rights, duties and obligations with
respect to all Cards, Cardholder Agreements, Cardholder Data, and the Bank’s
relationship with each Cardholder to such Successor Bank, (C) making any
and all regulatory filings necessary to effect the transition of its
undertakings in connection with this Agreement to such Successor Bank, (D) making
all filings and taking all other actions necessary to transfer the related BINs
and the Skylight ABA Number to such Successor Bank, (E) executing and
delivering, if necessary or appropriate, an account transfer agreement
containing terms and conditions generally consistent with banking industry practice
for the transfer of accounts between institutions, and (F) executing other
documents as may reasonably be necessary for Bank to perform its obligations
under this Section 10.3.  Bank shall
provide such services without charge, provided that Program Manager reimburses
Bank for any expenses reasonably incurred by Bank in the performance of its
obligations under this Section 10.3(b). 
During the Transition Period, the Parties shall continue to be bound by
and comply with the terms of this Agreement and perform all of their
obligations hereunder until such date as Program Manager notifies Bank that the
transition of the Program(s) to the Successor Bank is complete.


 


(c)                                  In the event of
an expiration or termination of this Agreement, the Parties agree to use the
following process or such other similar processes that are mutually agreed by
Bank and Program Manager at such time:


 


(i)                                     As soon as reasonably
possible after expiration of this Agreement or receipt or delivery of a
termination notice, Program Manager, or Bank, as applicable, will provide to
the other Party in writing a proposed transition plan, detailing (A) for
each Program, whether the Program is to be wound down or transferred to a
Successor Bank; and (B) a proposed timeline, which shall designate a
schedule of dates as of which each Program will be wound down or transferred
from Bank to a Successor Bank (each, a “Switchover Date”).  Bank and Program Manager shall meet promptly
thereafter to finalize a mutually agreed transition plan and Switchover
Date.  Bank shall use commercially
reasonable efforts to obtain all approvals from any System or Regulatory
Authority which may be necessary to in order for the length of the 


 


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Transition Period to be sufficient to permit Program Manager to sell
all remaining unsold Cards which contain Bank’s Marks.


 


(ii)                                  As soon as possible, but no
later than ten (10) Business Days, after the Switchover Date, each of Bank
and Program Manager shall submit to the other an invoice for any costs,
expenses or other amounts due and owing by the other as of the Switchover Date,
which amounts shall be netted and the Party owing the greater amount shall pay
the net amount to the other Party within thirty (30) calendar days thereafter.


 


(iii)                               If Program Manager elects
not to transition an affected Program to a Successor Bank pursuant to Section 10.3(a),
Bank and Program Manager shall continue to be bound by and comply with the
terms of this Agreement and perform all of their obligations hereunder during
the Transition Period until such time as all Cards expire or are canceled
pursuant to and consistent with the Cardholder Agreements, or such earlier
date, as permitted by Applicable Law, and as mutually agreed by Bank and
Program Manager; provided that the Parties agree that such Cards will be
treated in accordance with the following principles:


 


(A)                              With respect to
Reloadable Cards, the affected Cardholders will be given at least sixty (60)
calendar days notice of termination; and


 


(B)                                With respect to
Nonreloadable Cards, the Cards will be permitted to “wind down” until all of
such Nonreloadable Cards have expired in accordance with their terms or the
balance related to such Cards has been depleted, whichever occurs first.


 


During the Transition Period, Program Manager agrees to continue to
provide customer service to the affected Cardholders in accordance with the
terms of this Agreement.  In the event
that Program Manager elects not to transition an affected Program to a
Successor Bank pursuant to Section 10.3(a) or Program Manager fails
to continue to provide customer service to the affected Cardholders during the
Transition Period in accordance with the terms of this Agreement, Program
Manager shall, in its sole discretion, either (i) transfer to Bank control
of the toll free telephone numbers and websites used by Program Manager with
respect to such Program (the “Program Telephone Numbers
and Websites”) or (ii) re-direct Cardholders using the Program
Telephone Numbers and Websites to such toll-free telephone numbers and websites
as designated by Bank.


 


(f)            In no event
will any Party make any public statement or customer communication regarding
the termination or wind-down of this Agreement, or any Cards or Programs
without the express prior written approval of the other Party, which approval
shall not be unreasonably withheld or delayed. 
Notwithstanding the foregoing, each Party may communicate the termination
or expiration of this Agreement to any third party with which it has contracted
to provide services for the affected Cards and/or Programs (e.g., affected
Systems) and Program Manager may communicate the termination or expiration of
this Agreement to any third party with which it desires to negotiate to serve
as the Successor Bank for the affected Program(s).


 


ARTICLE XI — CONFIDENTIALITY &
DATA SECURITY


 


SECTION 11.1              — Confidential
Information


 


The
term “Confidential Information”
shall mean this Agreement and any schedule, exhibit, attachment or amendment
hereto; any information concerning any Program, the objectives of any Program
and the financial results of the Program(s); any marketing plan for any Program
and any marketing materials for any Program which are not publicly available; and
all proprietary information, 


 


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data,
trade secrets, business information and other information of any kind
whatsoever which a Party (“Discloser”)
discloses, in writing, orally or visually, to another Party (“Recipient”) or to which Recipient
obtains access in connection with the negotiation and performance of this
Agreement. Cardholder Data shall not be Confidential Information, but rather
shall be subject to the provisions of Article XII below.  Confidential Information shall not include
information that: (i) is already rightfully known to the Recipient at the
time it obtains Confidential Information from the Discloser; (ii) is or
becomes generally available to the public other than as a result of disclosure
in breach of this Agreement or any other confidentiality obligations; (iii) is
lawfully received on a non-confidential basis from a third party authorized to
disclose such information without restriction and without breach of this
Agreement; (iv) is contained in, or is capable of being discovered through
examination of publicly available records or products; or (v) is developed
by Program Manager or Bank without the use of any proprietary, non-public
information provided by the other Party.


 


SECTION 11.2              — Use
and Disclosure of Confidential Information


 


(a)                                  Each Recipient
shall use and disclose the Confidential Information of the Discloser only for
the purpose of performing its obligations or enforcing its rights with respect
to any Program or as otherwise expressly permitted by this Agreement, and shall
not accumulate in any way, disclose or make use of such Confidential
Information for any other purpose.  Each
Recipient may disclose Confidential Information to the extent such Confidential
Information is required to be disclosed by Applicable Law, including in the
course of an examination by a Regulatory Authority; provided (i) that,
except in connection with disclosure in the ordinary course of an examination
by a Regulatory Authority, the Party subject to such Applicable Law shall
notify the Discloser of any such use or requirement prior to disclosure of any
Confidential Information obtained from the Discloser in order to afford the
Discloser an opportunity to seek a protective order to prevent or limit
disclosure of the Confidential Information to third parties and (ii) that
the Party subject to such Applicable Law shall disclose Confidential
Information of the Discloser only to the extent required by such Applicable
Law.


 


(b)                                 Each Recipient
shall (i) limit access to the Discloser’s Confidential Information to
those employees, authorized agents, vendors, consultants, service providers and
subcontractors who have a reasonable need to access such Confidential Information
in connection with the Agreement and applicable Program(s); and (ii) ensure
that any person with access to the Discloser’s Confidential Information is
bound to maintain the confidentiality of Confidential Information and maintains
the existence of this Agreement and the nature of their obligations hereunder
strictly confidential.


 


(c)                                  Each Recipient
agrees that any unauthorized use or disclosure of Confidential Information of
the Discloser might cause immediate and irreparable harm to the Discloser for
which money damages might not constitute an adequate remedy.  In that event, the Recipient agrees that
injunctive relief may be warranted in addition to any other remedies the
Discloser may have.  In addition, the
Recipient agrees promptly to advise the Discloser by telephone and in writing
via facsimile of any security breach that may have compromised any Confidential
Information, of any unauthorized misappropriation, disclosure or use by any
person of the Confidential Information of the Discloser which may come to its
attention and to take all steps at its own expense reasonably requested by the
Discloser to limit, stop or otherwise remedy such misappropriation, disclosure
or use.


 


SECTION 11.3              — Return
of Confidential Materials


 


Upon the termination or expiration of this Agreement and any applicable
Transition Period, or at any time upon the reasonable request of a Discloser,
the Recipient shall return (or destroy if so directed by the Discloser) all
Confidential Information in the possession of the Recipient or in the
possession of any representative, contractor or third party of the
Recipient.  Notwithstanding the
foregoing, a Recipient in possession of tangible property containing the
Discloser’s Confidential Information may retain one archived copy of such
material, subject to the terms of this Agreement, which may be used solely for
regulatory purposes and may not be used for any other purpose.  Compliance with this Section 11.3 shall


 


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be
certified in writing, including a statement that no copies of Confidential
Information have been retained, except as necessary for regulatory purposes.


 


SECTION 11.4
— Non-Solicitation of Employees


 


Each
Party agrees that during the term of this Agreement it will not seek out or
induce any person (by offering employment or otherwise) who is an employee of
the other Party to terminate their employment with the other Party.  For purposes of clarity, this non-solicitation
provision does not apply to those employees responding to a general
advertisement.


 


SECTION 11.5
— Media Releases


 


All
media releases, public announcements and public disclosures by Bank or Program
Manager, or their representatives, employees or agents, relating to this
Agreement or the name or Marks of Bank or Program Manager, any Bank or Program
Manager affiliate or supplier, including, without limitation, promotional or
marketing material, but not including any disclosure required by legal, accounting
or regulatory requirements beyond the reasonable control of the releasing
Party, shall be coordinated with and approved by Program Manager or Bank,
respectively, in writing prior to the release thereof.


 


ARTICLE XII — DATA SECURITY


 


SECTION 12.1 — General


 


The
purpose of this Article XII is to ensure that this Agreement conforms to
the applicable provisions of the Gramm-Leach-Bliley Act and the System Rules and
otherwise set forth the Parties’ agreement with respect to the shared use and
disclosure of Cardholder Data.  All
sharing, use and disclosure of Cardholder Data under this Agreement shall be
subject to the provisions of this Article XII.  Each Party will establish and maintain
appropriate administrative, technical and physical safeguards designed to (i) protect
the security, confidentiality and integrity of the Cardholder Data, (ii) ensure
against any anticipated threats or hazards to its security and integrity, (iii) protect
against unauthorized access to or use of such information or associated records
which could result in substantial harm or inconvenience to any Cardholder or
applicant; and (iv) ensure the proper disposal of Cardholder Data.  Such safeguards shall be established in
accordance with Applicable Law, including, without limitation, Section 501
of GLBA and the Interagency Guidelines Establishing Standards for Safeguarding
Customer Information adopted pursuant to Section 501 of GLBA.  Each Party shall use the same degree of care
in protecting the Cardholder Data against unauthorized disclosure as it accords
to its other confidential customer information, but in no event less than a
reasonable standard of care.  In the
event either Bank or Program Manager becomes aware of any unauthorized use,
modification, destruction or disclosure of, or access to, Cardholder Data, such
Party shall immediately notify the other Party and shall cooperate with such
other Party, (x) to assess the nature and scope of such incident, (y) to
contain and control such incident to prevent further unauthorized access to or
use of Cardholder Data, and (z) to provide prompt notice to affected
Cardholders.  The Party through which
such unauthorized use, modification, destruction, disclosure or access occurred
shall bear the cost and expenses of any notice or other action required due to
unauthorized use, modification, destruction or disclosure of, or access to,
Cardholder Data.


 


SECTION 12.2
— Ownership of Cardholder Data and Privacy Policy


 


As
between the Parties, during the Term of this Agreement, the Cardholder Data shall
be the property of and owned by Bank and shall be subject to Bank’s Privacy
Policy.  Bank agrees that at all times
its Privacy Policy shall permit (i) Bank to share Cardholder Data with
Program Manager and each person or entity with which Program Manager contracts
to perform services in connection with the applicable Program, and (ii) Program
Manager to use such Cardholder Data to market other products and services to
Cardholders.  Bank shall develop, and
Program Manager shall provide Cardholders with, such


 


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notices,
opt-ins, opt-outs and other disclosures to the extent necessary to permit,
subject to Applicable Law, Bank to share such information with Program Manager
and to permit Program Manager to use and disclose such information for
marketing purposes in each of the jurisdictions where Cards are offered,
subject to Applicable Law.  During normal
business hours and upon ten (10) calendar days prior written notice, Bank
has the right to inspect Program Manager’s records to ensure that Program
Manager complies with the opt-out elections made by Cardholders.  Products or services provided to a Cardholder
by Program Manager, and any information regarding such Cardholder obtained by
Program Manager in connection therewith, which are outside the scope of this
Agreement, will, following the termination or expiration of this Agreement,
remain the property of Program Manager.


 


SECTION 12.3
— Use and Disclosure of Cardholder Data


 


(a)           Neither Party shall use, or permit to
be used, the Cardholder Data, except as provided in this Article XII.    Bank agrees that, during and after the Term
of this Agreement, it shall not use, nor permit any third party other than
Program Manager or its designated Program Affiliate(s) to use, any
Cardholder Data other than as necessary to perform Bank’s regulatory
obligations hereunder or as required to comply with Applicable Law.


 


(b)           Each Party, and each Person with
which either Party contracts to perform any portion of such Party’s obligations
hereunder may receive, use and disclose the Cardholder Data with respect to the
relevant Program(s) solely to the extent permitted by this Article XII
and in compliance with Applicable Law and the Privacy Policy (i) for
purposes of promoting the Cards and Programs, (ii) as otherwise necessary
to carry out its obligations under this Agreement, and (iii) as otherwise
permitted by the Privacy Policy and Applicable Law.   Neither Party shall, directly or indirectly,
sell or otherwise transfer any right in or to the Cardholder Data other than as
provided herein.


 


(c)           During the Term of this Agreement,
the Cardholder Data shall be owned by Bank, but the manner in which such
Cardholder Data may be used, shared and disclosed by the Parties and/or the
customer during the Term shall be as set forth herein.


 


(d)           Each Party may disclose the
Cardholder Data in compliance with Applicable Law and the Privacy Policy
solely:


 


(i)            to any System or
other entity to which disclosure is necessary in connection with the processing
a Transaction;


 


(ii)           to its
subcontractors in connection with a permitted use of such Cardholder Data under
this Article XII, provided that each such subcontractor agrees in writing
to maintain all such Cardholder Data as strictly confidential in perpetuity and
not to use or disclose such information to any person other than Program
Manager or Bank, except as required by Applicable Law or any Regulatory
Authority (after giving Bank or Program Manager ,as applicable, prior notice
and an opportunity to defend against such disclosure); provided, further, that
each such subcontractor maintains, and agrees in writing to maintain, an
information security program that is designed to protect Cardholder Data and
information related to Transactions, and which complies with the requirements
under Applicable Law;


 


(iii)          to its employees,
consultants, attorneys and accountants with a need to know such Cardholder Data
in connection with a permitted use of such Cardholder Data under this Article XII;
provided that (A) any such person is bound by terms substantially similar
to this Article XII as a condition of employment or of access to
Cardholder Data or by professional 


 


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obligations
imposing comparable terms; and (B) such Party shall be responsible for the
compliance by each such person with the terms of this Article XII


 


(iv)          to any Regulatory
Authority with authority over Program Manager (A) in connection with an
examination of either Party; or (B) pursuant to a specific requirement to
provide such Cardholder Data by such Regulatory Authority or pursuant to
compulsory legal process; provided that such Party seeks the full protection of
confidential treatment for any disclosed Cardholder Data to the extent
available under Applicable Law governing such disclosure, and with respect to
clause (B), to the extent permitted by Applicable Law, such Party (1) provides
at least ten (10) Business Days’ prior notice of such proposed disclosure
to the other Party if reasonably possible under the circumstances, and (2) seeks
to redact the Cardholder Data to the fullest extent possible under Applicable
Law governing such disclosure;


 


(e)           Notwithstanding the foregoing,
Program Manager shall be permitted to disclose the Cardholder Data in
compliance with Applicable Law and the Privacy Policy to any third party for
purposes of marketing other goods or services to the extent permissible under Applicable
Law and the Privacy Policy.


 


SECTION 12.4
— Treatment of Cardholder Data Upon Expiration or Termination


 


With
respect to the sharing, use and disclosure of Cardholder Data following the
expiration or termination of this Agreement in its entirety:


 


(a)           the rights and obligations of the
Parties under this Article XII with respect to affected Cardholder Data
shall continue through any Transition Period; and


 


(b)           The manner in which Cardholder Data
may be used, shared and disclosed by the Parties and/or the customer after the
expiration or termination of this Agreement shall be as set forth herein.


 


SECTION 12.5
— Additional Products & Services


 


During
the Term of this Agreement and with Bank’s approval, which shall not be
unreasonably withheld or delayed, Program Manager shall be permitted to offer
and market, consistent with Applicable Law and the Privacy Policy, additional
products and services that are not included in an existing Program, including,
without limitation, third party products and services, to all or a portion of
existing Cardholders.


 


SECTION 12.6
— Data Security


 


Program
Manager agrees to and represents to Bank that it (and/or any of its
subcontractors) has implemented a security program including measures designed
to meet the objectives of the Guidelines. 
At all times during the Term, Program Manager shall be in compliance
with all information and data security requirements promulgated by the System
and applicable to card issuers (as set forth in the System Rules), the Payment
Card Industry Data Security Standard and the Guidelines, as the same may be
revised from time to time.  Program
Manager shall provide Bank with copies of all reports on compliance, quarterly
and annual status forms and other reports filed by Program Manager with any
System in accordance with the System Rules. 
During normal business hours and upon twenty (20) calendar days prior
written notice, or such other time as required by Applicable Law or the
Regulatory Authority, Bank has the right to inspect, no more than once during
any consecutive twelve (12) month period unless required more frequently by
Applicable Law or the Regulatory Authority, Program Manager’s security program,
associated audit reports, summaries of test results or equivalent measure taken
by Program Manager , and any third party engaged by Program Manager to perform
any of Program Manager’s


 


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obligations
hereunder, to ensure that its security measures meet the objectives of the
Guidelines in accordance with the System Rules and this Agreement.


 


ARTICLE XIII - INSURANCE


 


SECTION 13.1 — Insurance


 


Each
Party shall maintain, throughout the Term, appropriate comprehensive general
liability (which shall include contractual liability), errors and omissions,
bodily injury, property damage, and employee theft and dishonesty insurance
policies, the limit of which shall be no less than a combined single limit of
One Million Dollars ($1,000,000) per occurrence.


 


ARTICLE XIV - GENERAL PROVISIONS


 


SECTION 14.1 — Indemnification


 


(a)           Program Manager covenants and agrees
to indemnify and hold harmless Bank, its parent, subsidiaries or affiliates,
and their respective officers, directors, employees and permitted assigns, as such,
against any and all liability, damages, costs, expenses, including reasonable
legal fees and expenses, for any third party claim or demand, including,
without limitation, any fees or penalties assessed by any System or Regulatory
Authority (“Claim”), arising out of or
related to: (i): Program Manager’s breach of a representation, warranty,
covenant or obligation under this Agreement, (ii) the gross negligence,
fraud or willful misconduct of Program Manager, (iii) any claim relating
to obligations owed to or by Program Manager or any third party retained by it.
This provision shall not apply to the extent Bank is obligated to provide
indemnity under sub paragraph (b) below. 
In the event of any conflict between this Section 12.1 and any
other provision of this Agreement, this Section 12.1 shall control.


 


(b)           Bank covenants and agrees to
indemnify and hold harmless Program Manager, its parent, subsidiaries or
affiliates, and their respective officers, directors, employees and permitted
assigns, as such, against any Claim arising out of or related to: (i): Bank’s
breach of a representation, warranty, covenant or obligation under this
Agreement, (ii) the gross negligence, fraud or willful misconduct of Bank,
(iii) any claim relating to obligations owed to or by Bank or any third
party retained by it. This provision shall not apply to the extent Program
Manager is obligated to provide indemnity under sub paragraph (a) above.


 


(c)           If any Claim is asserted against any
party or parties (individually or collectively, the “Indemnified
Party”) by any person who is not a Party to this Agreement in
respect of which the Indemnified Party may be entitled to indemnification under
the provisions of subsections (a), (b) or (c) above, written notice
of such Claim shall promptly be given to any Party or Parties (individually or
collectively, the “Indemnifying Party”) from
whom indemnification may be sought.  The
Indemnifying Party shall have the right, by notifying the Indemnified Party
within ten (10) Business Days of its receipt of the notice of the Claim,
to assume the entire control (subject to the right of the Indemnified Party to
participate at the Indemnified Party’s expense and with counsel of the
Indemnified Party’s choice) of the defense, compromise or settlement of the
matter, including, at the Indemnifying Party’s expense, employment of counsel
of the Indemnifying Party’s choice.  If
the Indemnifying Party gives notice to any Indemnified Party that the
Indemnifying Party will assume control of the defense, compromise or settlement
of the matter the Indemnifying Party will be deemed to have waived all defenses
to the claims for indemnification by the Indemnified Party with respect to that
matter.  Any damage to the assets or
business of the Indemnified Party caused by a failure of the Indemnifying Party
to defend, compromise or settle a claim or demand in a reasonable and
expeditious manner, after the Indemnifying Party has given notice that it will
assume control of the defense, shall be included in the damages for which the
Indemnifying Party shall be obligated to indemnify the Indemnified Party.  The Indemnifying Party shall not compromise
or settle a Claim against the Indemnified Party without the Indemnified Party’s
consent, which shall not be unreasonably withheld or delayed.


 


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SECTION 14.2
— Disclosure


 


(a)           Each Party shall promptly notify the
other of any action, suit, proceeding, facts and circumstances, and the threat
of reasonable prospect of same, which might give rise to any indemnification
hereunder or which might materially and adversely affect either Party’s ability
to perform this Agreement.


 


(b)           Each Party represents and warrants to
the other that it has no knowledge of any pending or threatened suit, action,
arbitration or other proceedings of a legal, administrative or regulatory
nature, or any governmental investigation, against it or any of its affiliates
or any officer, director, or employee which has not been previously disclosed
in writing and which would materially and adversely affect its financial
condition, or its ability to perform this Agreement.


 


SECTION 14.3 — Use of Marks


 


(a)            Bank’s Marks.  Bank hereby grants to Program Manager during
the Term, and any wind-down or Transition Period, a non-exclusive,
royalty-free, non-assignable license, in the United States, to use Bank’s Marks
(and the copyrights that exist in such Marks, if any) as the Bank authorizes in
connection with the Program(s), including on the Cards, on account statements,
on Cardholder Agreements, and in other communications to Cardholders and
prospective Cardholders.  Bank’s Marks
shall be used only in the forms and format expressly approved by Bank, which
approval shall not be unreasonably withheld, condition or delayed.  Except as provided herein, it is expressly
agreed that neither Program Manager nor any Cardholder is acquiring any right,
title or interest (other than the foregoing license rights) in Bank’s Marks,
which shall remain the property and/or rights of Bank.  Program Manager agrees that it shall not
challenge the title or any rights of Bank in and to Bank’s Marks.


 


(b)           Processor Marks.  Program Manager hereby grants to Bank during
the Term, and any wind-down or Transition Period, a non-exclusive,
non-assignable license, in the United States, to use Program Manager’s Marks
(and the copyrights that exist in such Marks, if any) as Program Manager
authorizes in connection with the Program(s), including on the Cards, on
account statements, on Cardholder Agreements, and in other communications to
Cardholders and prospective Cardholders. 
Program Manager’s Marks shall be used only in the forms and format
expressly approved by Program Manager, which approval shall not be unreasonably
withheld, condition or delayed.  Except
as provided herein, it is expressly agreed that neither Bank nor any Cardholder
is acquiring any right, title or interest (other than the foregoing license
rights) in Program Manager’s Marks, which shall remain the property and/or
rights of Program Manager.  Bank agrees
that it shall not challenge the title or any rights of Program Manager in and
to Program Manager’s Marks.


 


SECTION 14.4  — Third Party Services


 


Program Manager shall obtain Bank’s prior written approval, which Bank
may grant or deny in its reasonable discretion, before retaining any Program
Affiliate, and will assist Bank in obtaining such due diligence materials from,
or agreements with, any proposed Program Affiliate that Bank may deem
reasonably necessary or that may otherwise be required by Applicable Law.  Bank’s approval of any proposed Program
Affiliate shall not in any way relieve Program Manager of its duties and
obligations under this Agreement, nor shall such approval constitute a
representation or warranty by the Bank that the services to be performed or
products to be furnished by such Program Affiliate will be performed as agreed
or represented.


 


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SECTION 14.5
— Relationship of Parties


 


Bank
and Program Manager agree they are independent contractors to each other in
performing their respective obligations hereunder.  Nothing in this Agreement or in the working
relationship being established and developed hereunder shall be deemed, nor
shall it cause, Bank and Program Manager to be treated as partners, joint
ventures, or otherwise as joint associates for profit.  Notwithstanding the foregoing, to extent
required by Applicable Law, Bank’s appointment of Program Manager as Bank’s
authorized representative will establish an agency relationship, limited
strictly to the rights, duties and obligations as set forth herein.  Accordingly, Program Manager hereby agrees as
follows:


 


(a)                                  Program Manager
shall serve as Bank’s representative or agent for purposes of rendering the
marketing, solicitation, sales and distribution services and other related
services as set forth herein.


 


(b)                                 Program Manager
acknowledges Bank’s right to monitor and review the activities Program Manager
performs for Bank hereunder;


 


(c)                                  Program Manager
acknowledges the statutory authority of Bank’s Regulatory Authority to regulate
and examine and take an enforcement action against the Program Manager with
respect to the activities performed by Program Manager as agent or
representative of the Bank;


 


(d)                                 Program Manager
acknowledges that Bank has provided the Program Manager with information and
training designed to insure that Program Manager will be adequately educated
about the Bank’s products and services offered hereunder, including the
distinctions between insured and non-insured products, and relevant law that
may apply to the marketing, solicitation, and customer service activities
instituted on behalf of Bank hereunder;


 


(e)                                  Program Manager
acknowledges that Bank will review and update the training material on an
annual basis and will ensure that Program Manager receives training as needed;
Program Manager’s training records will be made available for review by Bank’s
Regulatory Authority;


 


(f)                                    Program Manager
acknowledges that Bank must adopt a detailed compliance program to ensure
adequate monitoring, supervision, and control over the Program Manager and the
activities that the Program Manager performs on behalf of the Bank.  Such oversight includes ensuring Program
Manager’s own anti-money laundering compliance programs are detailed, thorough,
and implemented accurately and fully.


 


(g)                                 Program Manager
acknowledges that Bank will undertake an annual review of the compliance
program conducted under the auspices of the Bank’s compliance officer to
determine if Program Manager is operating in compliance with the Bank’s
established policies and procedures regarding the marketing, solicitation,
customer service, or other activities related to the Bank’s authorized banking
products or services;


 


(h)                                 Program Manager
acknowledges that Bank will institute a system for tracking and resolving
consumer complaints involving Cards and Programs hereunder in a timely manner
and will provide an annual report regarding consumer complaints and their
resolution to the Bank’s board of directors;


 


(i)                                     Program Manager
acknowledges that a review and approval process will be undertaken by Bank for
all Card and Program disclosures, advertising, and other promotional material;


 


(j)                                     Program Manager
acknowledges that the Bank and Program Manager, in its capacity as the Bank’s
authorized delegate and representative, are both subject to control and
supervision by Bank’s Regulatory Authority. 
This control and supervision includes, but is not limited to, the
ability to require that Bank obtain it’s Regulatory Authority’s approval (or
non-objection) before entering into a contractual arrangement with Program
Manager and the right of Bank’s Regulatory Authority to approve specific
contractual language;


 


(k)                                  Program Manager
acknowledges that Bank’s Regulatory Authority may require both Bank and the
Program Manager, in its capacity as the Bank’s authorized delegate and
representative to submit periodic reports to Bank’s Regulatory Authority;


 


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(l)                                     Program Manager
acknowledges that Bank’s Regulatory Authority may require the Bank to modify or
terminate its relationship with the Program Manager at any time; and


 


(m)                               Bank’s
Regulatory Authority may institute any other requirements or conditions that it
deems appropriate for that particular purpose.


 


SECTION 14.6
— Governing Law


 


The
Parties acknowledge that Bank, as a federally charted savings bank, is
regulated by the OTS, and is therefore subject to federal law, and entitled to
preemption from state laws to the fullest extent permitted by law.  In any matters not so preempted (if any) this
Agreement shall be governed by the internal laws, and not by the laws regarding
conflicts of laws, of the State of South Dakota.  Each Party hereby submits to the jurisdiction
of the courts of such state, and (subject to the Bank’s reservation of
preemption rights above) waives any objection to venue with respect to actions
brought in such courts.


 


SECTION 14.7 — Force Majeure


 


No Party shall be liable for any failure or delay on its part to
perform, and shall be excused from performing any of its non—monetary
obligations hereunder if such failure, delay or non—performance results in
whole or in part from any cause beyond the absolute control of the Party,
including without limitation, any act of God, act of war, riot, actions of
terrorists, earthquake, fire, explosion, natural disaster, flooding, embargo,
sabotage, government law, ordinance, rule, regulation, order or actions.  Any Party desiring to rely upon any of the
foregoing as an excuse for failure, default or delay in performance shall, when
the cause arises, give to the other Parties prompt notice in writing of the
facts which constitute such cause; and, when the cause ceases to exist, give
prompt notice thereof to the other Parties. 
This Section 14.7 shall in no way limit the right of any Party to
this Agreement to make any claim against third parties for any damages suffered
due to said cause.  If any performance
under this Agreement is postponed or extended for longer than sixty (60)
calendar days any Party may, by written notice to the other Parties, terminate
this Agreement immediately.


 


SECTION 14.8
— Severability


 


In
the event that any part of this Agreement is deemed by a court, Regulatory
Authority, System, or other public or private tribunal of competent
jurisdiction to be invalid or unenforceable, such provision shall be deemed to
have been omitted from this Agreement. The remainder of this Agreement shall
remain in full force and effect, and shall be modified to any extent necessary
to give such force and effect to the remaining provisions, but only to such
extent.


 


SECTION 14.9
— Survival


 


The
Parties agree that the following sections will survive termination:  Article IX (Limitation of Liability); Section 10.3
(Termination and Transition Assistance); Article XI (Confidentiality); Article XII
(Data Security); Section 14.1 (Indemnification); Section 14.3 (Use of
Marks); Section 14.6 (Governing Law); and Sections 14.8 through 14.16.


 


SECTION 14.8
— Successors and Third Parties


 


Except as limited by Section 14.9, this Agreement and the rights
and obligations hereunder shall bind, and inure to the benefit of the Parties
and their successors and permitted assigns.


 


SECTION 14.9
— Assignments


 


Neither Party may assign this Agreement or any of
its rights or obligations hereunder, by operation of law or otherwise, without
the prior written consent of the other Party, which consent shall not


 


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be
unreasonably withheld, provided that the non-assigning Party’s consent need not
be obtained in connection with the assignment of this Agreement pursuant to a
merger by the assigning Party with, or sale of all or substantially all of its
assets, stock or securities to, any entity or controlled affiliate thereof that
(a) has a net worth and cash flow as of the date of the merger or sale at
least as much as the net worth and cash flow of the assigning Party on such
date; and in each case (b) is not currently subject to any written order
or action by any Regulatory Authority. 
Notwithstanding the foregoing, Bank may not assign this Agreement or any
of its rights or obligations hereunder other than to a federally-chartered,
federally-insured financial institution.


 


SECTION 14.10
— Notices


 


All
notices, requests and approvals required by this Agreement shall be in writing
addressed/directed to the other Party at the address and facsimile set forth
below, or at such other address of which the notifying Party hereafter receives
notice in conformity with this section. 
All such notices, requests, and approvals shall be deemed given upon the
earlier of receipt of facsimile transmission during the normal business day or
actual receipt thereof.  All such
notices, requests and approvals shall be addressed as follows:


 


	
  If to Bank:

  	
  MetaBank
  dba Meta Payment Systems

  
	
   

  	
  5501 S. Broadband Lane

  
	
   

  	
  Sioux Falls, SD 57108

  
	
   

  	
  Attention: General Counsel

  
	
   

  	
  Facsimile Number: (605) 338-0596

  
	
   

  	
   

  
	
  If to Program Manager:

  	
  Skylight
  Financial, Inc.

  
	
   

  	
  c/o NetSpend Corporation

  
	
   

  	
  701 Brazos St., Suite 1200

  
	
   

  	
  Austin, Texas 78701

  
	
   

  	
  Attention: General Counsel

  
	
   

  	
  Facsimile Number: (512) 469-9951

  



 


SECTION 14.11 — Waivers


 


Neither
Party shall be deemed to have waived any of its rights, power, or remedies
hereunder except in writing signed by an authorized agent or representative of
the Party to be charged.  Either Party
may, by an instrument in writing, waive compliance by the other Party with any
term or provision of this Agreement on the part of the other Party to be
performed or complied with.  The waiver
by either Party of a breach of any term or provision of this Agreement shall
not be construed as a waiver of any subsequent breach.


 


SECTION 14.12
— Entire Agreement; Amendments


 


This
Agreement constitutes the entire Agreement between the Parties and supersedes
all prior agreements, understandings, and arrangements, oral or written,
between the Parties with respect to the subject matter hereof.  This Agreement may not be modified or amended
except by an instrument or instruments in writing signed by the Party against
whom enforcement of any such modification or amendment is sought.


 


SECTION 14.13 — Counterparts


 


This
Agreement may be executed and then delivered via facsimile transmission, via
the sending of PDF or other copies thereof via email and in one or more
counterparts, each of which shall be an 


 


28

















 






***  Confidential Treatment
Requested


 


original
but all of which taken together shall constitute one and the same Agreement.


 


SECTION 14.14 — Disputes


 


(a)           Duty to Notify.  In the event of any dispute, controversy, or
claim arising out of or relating to this Agreement or the construction,
interpretation, performance, breach, termination, enforceability or validity
thereof (hereinafter, a “Dispute”),
the Party raising such Dispute shall notify the other promptly and no later than
sixty (60) days from the date of its discovery of the Dispute.  In the case of a Dispute relating to account
or transaction statements or similar matter, the failure of a party to notify
the other party of such Dispute within sixty (60) days from the date of its
receipt shall result in such matter being deemed undisputed and accepted by the
party attempting to raise such Dispute.


 


(b)           Cooperation to
Resolve Disputes.  The Parties shall
cooperate and attempt in good faith to resolve any Dispute promptly by
negotiating between persons who have authority to settle the Dispute and who
are at a higher level of management than the persons with direct responsibility
for administration and performance of the provisions or obligations of this
Agreement that are the subject of the Dispute.


 


(c)           Confidentiality
of Proceedings.  The proceedings
contemplated by this Section shall be as confidential and private as
permitted by law.  To that end, the
Parties shall not disclose the existence, content or results of any proceedings
conducted in accordance with this Section, and materials submitted in
connection with such proceedings shall not be admissible in any other
proceeding, provided, however, that this confidentiality provision shall not
bar disclosures required by any laws or regulations.


 


SECTION 14.15 — Headings


 


The headings, captions, headers, footers and
version numbers contained in this Agreement are inserted for convenience only
and shall not affect the meaning or interpretation of any provision of this
Agreement.  References in this Agreement
to any Article or Section are to such Article or Section of
this Agreement.


 


SECTION 14.16 — Drafting Presumption


 


Program Manager and Bank agree that they participated in the drafting
of this Agreement and, in the event that any dispute arises in the
interpretation or construction of this Agreement, no presumption shall arise that either one party or the other
drafted this Agreement.


 


[Signature page to
follow]


 


29

















 






***  Confidential Treatment
Requested


 


IN WITNESS WHEREOF, this Agreement is executed
by the Parties’ authorized officers or representatives and shall be effective
as of the date first above written.


 


	
  Skylight
  Financial, Inc.

  	
   

  	
  MetaBank,
  dba Meta Payment Systems

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Kevin Lee

  	
   

  	
  By:

  	
  /s/
  Brad C. Hanson

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Kevin
  Lee

  	
   

  	
  Name:

  	
  Brad
  C. Hanson

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  CEO

  	
   

  	
  Title:

  	
  President

  



 














 






***  Confidential Treatment
Requested


 


SCHEDULE A


Flow of Funds, Revenues and Compensation


 


I.  Flow of Funds


 


A.            All Cardholder
Funds hereunder shall be collected and forwarded to the Cardholder Account.


 


B.            All Program
Revenues shall accrue to the benefit of the Bank, provided that from such
Program Revenues Bank shall pay compensation to Program Manager as set forth in
Section II below.


 


C.            Bank shall
transfer Cardholder Funds from the Cardholder Account to Settlement Accounts in
an amount adequate to facilitate Settlement with the System on a daily basis or
as otherwise determined by Bank.


 


II.            Compensation to
Program Manager.


 


A.            MONTHLY STATEMENTS.  Program Manager’s compensation for any month shall be equal
to: ***.  Bank shall provide Program Manager a monthly electronic
statement (the “Monthly Statement”), no later
than the fifteenth (15th) day of each
month (if a business day, or if not, the next business day), setting forth the
*** for the immediately preceding month. 
As Program Manager’s compensation for the immediately preceding month,
Program Manager shall be entitled to retain in the Operating Account an amount
equal to *** for such month.  Within ten
(10) days after the delivery of the Monthly Statement to Program Manager, Bank
shall debit a bank account designated by Program Manager (the “Operating Account”) by an amount
equal to ***.


 


B.            ***  COMMISSIONS.  Bank
will pay Program Manager a fee each month equal to a percentage of ***, such
percentage to be based on ***.  For
purposes of the foregoing, ***.


 


	
  ***

  	
   

  	
  Program Manager’s

  Percentage

  	
   

  
	
  £$***

  	
   

  	
  ***

  	
  %

  
	
  $*** - $***

  	
   

  	
  ***

  	
  %

  
	
  >$***

  	
   

  	
  ***

  	
  %

  



 


C.            ***  AMOUNT. The “*** Amount”
for each month shall equal ***.  For
purposes of this Subsection C, ***.


 


	
  ***

  	
   

  	
  ***

  	
   

  
	
  £ $***

  	
   

  	
  ***

  	
   

  
	
  $*** - $***

  	
   

  	
  ***

  	
   

  
	
  $*** - $***

  	
   

  	
  ***

  	
   

  
	
  >$***

  	
   

  	
  ***

  	
   

  



 

















 






***  Confidential Treatment
Requested


 


D.            *** AMOUNT.  The “*** Amount”
for each month shall equal ***.  For
purposes of this Subsection D, ***.


 


	
  ***

  	
   

  	
  Amount per ***

  	
   

  
	
  £ ***

  	
   

  	
  $

  	
  ***

  	
   

  
	
  *** – ***

  	
   

  	
  $

  	
  ***

  	
   

  
	
  *** – ***

  	
   

  	
  $

  	
  ***

  	
   

  
	
  *** – ***

  	
   

  	
  $

  	
  ***

  	
   

  
	
  >***

  	
   

  	
  $

  	
  ***

  	
   

  



 

















 






***  Confidential Treatment
Requested


 


SCHEDULE B


Ratios


 


	
  Metric

  	
   

  	
  Threshold

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ***

  	
   

  	
  ***

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  ***

  	
   

  	
  ***

  	
  %