EXHIBIT 10.25

PORTIONS  OF  THIS  EXHIBIT  HAVE  BEEN  OMITTED   (BASED  UPON  A  REQUEST  FOR
CONFIDENTIAL  TREATMENT) AND HAVE BEEN FILED  SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 24b-2.


                                SERVICE AGREEMENT
                                   (ValueStar)

         THIS SERVICE AGREEMENT (this  "Agreement") is entered into and shall be
effective as of June 1st,  2000 (the  "Effective  Date"),  by and  between:  (i)
GOLDEN RETRIEVER SYSTEMS,  L.L.C., a Delaware limited liability company ("GRS");
(ii) and VALUESTAR  CORPORATION,  a California  corporation  with offices at 360
22nd Street, Suite 210, Oakland, California, 94612.


                                   Background

         GRS has developed and owns certain  proprietary  computer  software and
related  documentation  and  procedures  (collectively,  the  "Software")  which
enables GRS to receive transactional and other data from payment card processors
and  other  financial  institutions  and  create  and  deliver  reports,  files,
databases  and  related   services  to  GRS'  customers  and  other   designated
recipients.  ValueStar owns and operates the ValueStar  Program (the  "Program")
which offers  participating  "Members" the ability to take advantage of merchant
discounts and/or rewards by utilizing  "Registered  Cards" to purchase goods and
services  from  participating  "Merchants."  On the  terms  and  subject  to the
conditions set forth in this Agreement,  ValueStar  desires to purchase from GRS
and GRS desires to furnish to ValueStar,  certain  "Services"  described in this
Agreement for the administration of the Program.


                                    Agreement

         1. TERM.  The term of this Agreement (the "Term") shall commence on the
Effective Date and shall continue until  terminated in accordance with Paragraph
5, below.

         2.  SERVICES.  On the terms and subject to the  conditions set forth in
this Agreement, GRS will make the information,  data base management,  reporting
and ACH services  (collectively,  the  "Services")  described on Addendum "A" to
this Agreement  available to ValueStar,  its Members,  Merchants and others that
may be designated from time to time by ValueStar.

         3.  APPLICATION  SYSTEM.  All  Services  provided  by GRS to  ValueStar
pursuant  to this  Agreement  will be  provided  by and/or  through  ValueStar's
Application System (defined below).

         4.  PAYMENT.  As payment for the  Services  provided by GRS pursuant to
this  Agreement,  ValueStar  agrees to pay GRS the  development and service fees
(collectively,  the "Fees") at the times and in the  amounts  listed on Addendum
"B" to this Agreement.

         5. TERMINATION. The Minimum Term of this Agreement (the "Minimum Term")
shall be one (1) year following the "System Start Date" (defined  below).  After
the  expiration  of  the  Minimum  Term,  the  Term  of  this  Agreement   shall
automatically  renew for  successive  one (1) year periods  ("Renewal  Term(s)")
unless  terminated  by either party in accordance  with the following  sentence.
Upon the  expiration  of the Minimum  Term or, if  applicable,  each  successive
Renewal  Term,  either  party may  terminate  this  Agreement  for any reason by
providing  written notice of termination to the other party at least one hundred
and  eighty  (180)  days  prior to the  expiration  of the Term then in  effect.
Notwithstanding the foregoing:  (i) GRS may immediately terminate this Agreement
and/or cease providing  Services if ValueStar fails to pay all or any portion of
the Fees in  accordance  with  Addendum "B" after  receiving  written  notice of
default and a fifteen (15) day  opportunity  to cure;  and (ii)

                                      -1-

<PAGE>


either party may  immediately  terminate this Agreement  and/or cease  providing
Services in the event of a breach of any material term,  warranty,  condition or
covenant  (including  the  failure,  by  GRS,  to  provide  any of the  Services
(described  below) by the other party which  remains  uncured  after thirty (30)
days' written notice to defaulting other party.

         6.  GENERAL  TERMS AND  CONDITIONS.  The General  Terms and  Conditions
listed on Addendum "C" to this  Agreement are an integral part of this Agreement
and  shall  be  binding  on  ValueStar  and GRS as if  fully  set  forth in this
Paragraph 6.

         Executed as of the Effective Date by:

                                            GRS:

                                            GOLDEN RETRIEVER SYSTEMS, L.L.C., a
                                            Delaware limited liability company
                                            By: /s/ Craig Ludwig
                                            Its: President
                                                 -------------------------------


                                            ValueStar:

                                            VALUESTAR, a California Corporation
                                            By: /s/ Aaron Gray
                                            Its: Chief Operating Officer
                                                 -------------------------------

                                      -2-

<PAGE>


                                  ADDENDUM "A"

                 GENERAL OBLIGATIONS AND DESCRIPTION OF SERVICES

         1. Application  System. In connection with providing the Services,  GRS
will,  at GRS' expense,  construct,  install,  operate,  service and maintain an
application   system  for  ValueStar's   exclusive  use  during  the  Term  (the
"Application  System").  The  Application  System  will be  located at GRS' main
operating facility in Chandler,  Arizona.  The Application System will be custom
configured for ValueStar and capable of providing all of the Services  described
in this Agreement. The Application System's configuration shall include:

         a.       Primary  Application  Server.  The Primary  Application Server
                  processes  raw  transaction   data,   builds   historical  and
                  application  databases,  generates  reports and  provides  log
                  printing.

         b.       Transaction  Inquiry Server.  The  Transaction  Inquiry Server
                  services report inquiries, stores historical data and controls
                  report printing tasks.

         c.       Golden   Retriever(TM)   Proprietary   Software.   The  Golden
                  Retriever  Proprietary  Software  will  manage,   control  and
                  coordinate all information  processing,  data distribution and
                  reporting functions.

         d.       Miscellaneous.  The  Application  System will also include all
                  third-party software (the "Third-Party Software") and hardware
                  required  to support the  Services as well as the  appropriate
                  number  of  dedicated  inbound  and  outbound  phone  lines as
                  determined by GRS and  ValueStar  from time to time during the
                  Term.

         2. Initial Test and System Start Dates.  Subject to ValueStar providing
(or arranging for the delivery) to GRS of all necessary transactional data, data
base uploads and other information  required to deliver the Services in a timely
manner,  within ***** days following the approval of design  specification  (the
"Development  Period"),  GRS and ValueStar  will commence a  comprehensive  test
("Initial  Test")  of the  Application  System  in  order  to  confirm  that the
Application System is properly programmed and configured to provide the Services
in the manner required by the  Specification and this Agreement based on Phase I
functionality.  The date that the  Initial  Test is  completed  in all  material
respects (as  signified by the mutual  written  acknowledgment  of ValueStar and
GRS) will be the "System  Start  Date." GRS and  ValueStar  will  utilize  their
mutual best efforts to ensure that the System Start Date occurs by *****.

         3. Data Base  Maintenance.  During the Term,  ValueStar will create and
update and GRS will  maintain  the  following  Data  Bases  with  respect to the
Program:

                  a. Member Profile Database. On or before the expiration of the
Development  Period,  using an initial  file  upload  from  ValueStar,  GRS will
establish a data base of all Members initially participating in the Program (the
"Member Data Base").  The Member Data Base will be either  updated or completely
refreshed by ValueStar  daily or weekly using a mutually  acceptable  electronic
(Internet  FTP) file  delivery  protocol.  The Member Data Base will contain the
information  reasonably  required  by GRS to deliver  the  Services  all as more
specifically set-forth in the Specification.

* PORTIONS OF THIS EXHIBIT DENOTED HEREIN BY ***** HAVE BEEN OMITTED (BASED UPON
A REQUEST FOR  CONFIDENTIAL  TREATMENT) AND HAVE BEEN FILED  SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2.


                                      -3-

<PAGE>


                  b.  Participating   Merchant   Database.   On  or  before  the
expiration  of the  Development  Period,  using  an  initial  file  upload  from
ValueStar,   GRS  will  establish  a  data  base  of  all  Merchants   initially
participating in the Program (the "Merchant Data Base").  The Merchant Data Base
will be either  updated or  completely  refreshed by  ValueStar  daily or weekly
using a mutually  acceptable  electronic  (Internet FTP) file delivery protocol.
The Merchant Data Base will contain the information  reasonably  required by GRS
to deliver the Services all as more specifically set-forth in the Specification.

                  c.  Program  Database.  On or  before  the  expiration  of the
Development  Period,  using an initial  file  upload  from  ValueStar,  GRS will
establish  a data base of  Program  information  that will  include  the  fields
required to calculate the amount the merchant is to be debited and the amount to
be  credited  to the  member.  The  Program  Data Base will either be updated or
completely  refreshed by ValueStar  daily or weekly using a mutually  acceptable
electronic  (Internet  FTP) file delivery  protocol.  The Program Data Base will
contain the information  reasonably  required by GRS to deliver the Services all
as more specifically set-forth in the Specification.

                  d. Member Sponsor Database. On or before the expiration of the
Development  Period,  using an initial  file  upload  from  ValueStar,  GRS will
establish a data base of Member Sponsor information that will include the fields
required to rebate specific member  sponsors.  The Member Sponsor Data Base will
either be updated or completely  refreshed by ValueStar  daily or weekly using a
mutually acceptable electronic (Internet FTP) file delivery protocol. The Member
Sponsor Data Base will  contain the  information  reasonably  required by GRS to
deliver the Services all as more specifically set-forth in the Specification.

         4. Processing and Reporting Services. During the Term, GRS will provide
the following  Services to ValueStar  and  ValueStar  will provide the following
support to GRS:

                  a. Basic  Transaction  Processing.  Each processing day during
the Term, GRS will provide the following Basic Transaction Processing Services:

                           (i) ValueStar Bulk Transaction  Processing.  GRS will
download raw transaction  files from processors,  banks, ISO (Independent  Sales
Organizations)  and/or  directly from  Merchants as designated by ValueStar from
time to time during the Term (the "ValueStar  Transaction Files"). The ValueStar
Transaction Files will be limited to files used by GRS exclusively for ValueStar
and may include raw transaction data for Merchants  participating in the Program
(as well as non-participating  merchants) who are not otherwise included in GRS'
in-house  transaction  files. GRS will scan the ValueStar  Transaction Files and
segregate all transactions  relating to Merchants  participating in the Program.
The resulting  transactions will then be formatted and loaded to the Transaction
Information  Retrieval  System "TIRS" Data Base for further "PQT  Processing" as
defined below.

                  b. Potentially Qualified Transaction ("PQT") Processing.  Each
processing  day during the term,  GRS will  provide PQT  Transaction  Processing
Services to ValueStar.  PQT Processing will include the comparison of all Member
registered payment cards against the TIRS Data Base. All Member  transactions at
participating  Merchants  will  then  be  loaded  into a  separate,  Potentially
Qualified Transaction ("PQT") Data Base, for delivery to ValueStar in accordance
with the Specification. The PQT database will include an account number assigned
by ValueStar to each Members  transaction  rather than the actual Members credit
card number.

                  c. Administrative Reporting. As required by the Specification,
GRS will provide  ValueStar with periodic  administrative/management  data bases
and reports.

                                       -4-

<PAGE>


                                  ADDENDUM "B"

                                  FEE SCHEDULE

         1. Initial Service Fee.

                  a. Basic Service.  The Initial  Service Fee for this Agreement
will *****. The Initial Service Fee will be paid as follows:  (i) ***** paid (in
full) in connection with the Specification;  (ii) ***** per month payable at the
end of months 1, 2 and 3 (with  month  one  being  the  Effective  Date) and the
balance of ***** due and  payable  upon the System  Start  Date.  Subject to GRS
performing or tendering  performance  of its  obligations  under  Paragraph 4 of
Addendum "A" of this  Agreement,  the Initial Service Fee shall be deemed earned
when paid and ValueStar  shall not be entitled to a refund of all or any portion
of the Initial Service Fee.

         2. Monthly  Service Fees.  Each month  commencing with the System Start
Date, ValueStar shall pay GRS the following monthly fees:

                  a. Basic Service Fee: The Basic Service Fee will be *****.

                  b. Bulk Transaction  Processing.  Bulk Transaction  Processing
Fees will be at ***** per MID per month and subject to a *****  monthly cap. The
Bulk Transaction  Processing Fees are for loading transaction files into the GRS
TIRS  database.  The  transaction  files  can be  from  acquiring  institutions,
processors or direct send merchants.  The fee covers all MID's contained in each
of these transaction files

                  c.  Basic   Transaction   Processing.   Scanning  all  inbound
transactions  loaded to the GRS TIRS database for merchants  that are registered
to  ValueStar.  Each tier is  calculated  then  added to the next tier up to the
monthly cap.


              Transaction Ranges                   Cost Per Transaction
              ------------------                   --------------------
                     *****                                 *****
                     *****                                 *****
                     *****                                 *****

                  d.  PQT/AQT  Processing.   Identifies   potentially  qualified
transactions (PQT) for Members that are registered in the ValueStar program. The
PQT/AQT  Processing  shall also apply the specific  "program(s)"  if any, to the
transaction to award a rebate to the Member, assign fees to ValueStar,  merchant
sponsor  or  member  sponsor.  In  doing  so,  the PQT is  turned  into a Actual
Qualified Transaction (AQT).


              Transaction Ranges                   Cost Per Transaction
              ------------------                   --------------------
                    *****                                  *****
                    *****                                  *****
                    *****                                  *****
                    *****                                  *****
                    *****                                  *****
                    *****                                  *****


* PORTIONS OF THIS EXHIBIT DENOTED HEREIN BY ***** HAVE BEEN OMITTED (BASED UPON
A REQUEST FOR  CONFIDENTIAL  TREATMENT) AND HAVE BEEN FILED  SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2.

                                       -5-

<PAGE>


         3. Technical Support, Programming and Product Development. If requested
by ValueStar,  GRS' hourly fees for Additional  Services including  programming,
product development and technical support are as follows:

o        Technical Support                  ***** per hour
o        Programmer                         ***** per hour
o        Senior Programmer/Analyst          ***** per hour

                  GRS shall provide  customer  service and technical  support to
ValueStar in connection with the Services  during GRS' normal  customer  service
hours which are currently  6:00 a.m. to 6:00 p.m. (MST) Monday - Friday and 9:00
a.m. to 4:00 p.m. (MST) Saturday,  Sunday and holidays.  In all cases, GRS shall
respond to  ValueStar's  customer  services  inquiries  within  twenty-four  (24
hours).

         4. Intentionally Omitted.

         5. Pass-through Fees. All incremental  communication costs and expenses
incurred by GRS in  connection  with  retrieving  data from  ValueStar  or other
designated  sources (long distance  phone charges and other charges  approved by
ValueStar in writing) as well as Bank ACH Fees, overnight courier expenses,  and
reasonable  travel,  meals and lodging will be invoiced to and paid by ValueStar
on a monthly basis.

         6.  Monthly  Minimum  Billing.  Should the totals of the Monthly  Basic
Service Fee, Bulk Transaction Processing Fees, Basic Transaction Processing Fees
and PQT/AQT  Processing Fees be not equal to or greater than the monthly minimum
then the monthly  minimum  billing would be billed.  Commencing  with the System
Start Date, the monthly  minimum billing under this Agreement will be ***** plus
any Pass-through Fees as listed above.

         7. Fee  Adjustment.  Subject to a *****  annual cap (or the most recent
increase in the U.S. All Urban Consumer Price Index,  whichever is less) and GRS
providing ValueStar with one hundred twenty (120) days prior written notice, GRS
reserves  the  right  to  adjust  any Fees to  reflect  current  market  pricing
annually, during any Renewal Term.

         8. Payment.  All Services  provided  pursuant to this Agreement will be
invoiced  and paid for on a monthly  basis.  All  invoices  shall be due in full
within thirty (30) days from the statement date. All past due payments will bear
interest at the rate of one and one-half percent (1 1/2%) per month.




* PORTIONS OF THIS EXHIBIT DENOTED HEREIN BY ***** HAVE BEEN OMITTED (BASED UPON
A REQUEST FOR  CONFIDENTIAL  TREATMENT) AND HAVE BEEN FILED  SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2.

                                       -6-

<PAGE>


                                  ADDENDUM "C"

                          GENERAL TERMS AND CONDITIONS

         1.  Defined  Terms.  Capitalized  terms not  otherwise  defined in this
Addendum  "C"  shall  have  the  meanings  ascribed  to  them  elsewhere  in the
Agreement.

         2.  Binding  Effect.   The  following   General  Terms  and  Conditions
constitute an integral part of this  Agreement and shall be binding upon GRS and
ValueStar.

         3. GRS Warranty, Indemnification and Liability Limitation.

                  (a) GRS  Warranty.  GRS  represents  and warrants to ValueStar
that  GRS  owns  and has the  right to use the  Software  and has  obtained  all
appropriate  licenses to the  Third-Party  Software in connection with providing
the Services to  ValueStar.  GRS further  warrants that the  Application  System
will,  subject  to normal  maintenance  and repair  requirements,  be capable of
providing all Services in accordance  with this Agreement If the System fails to
perform in  accordance  with this  Agreement,  GRS shall  undertake  to promptly
repair the System at no cost to ValueStar within 15 days.

                  (b) GRS Indemnification. GRS shall, at its expense, defend and
hold ValueStar  harmless from any action to the extent such action is based on a
claim that the Software infringes a United States patent,  trademark,  copyright
or trade secret and GRS shall indemnify  ValueStar for all damages,  liabilities
and costs directly related to such an infringement  claim.  ValueStar shall give
GRS prompt  written  notice of any  indemnifiable  action or claim and GRS shall
have primary  control of the defense,  negotiation,  compromise or settlement of
such claim and ValueStar shall cooperate in the defense of such claim(s) at GRS'
expense.  In the case of an  infringement  or  alleged  infringement,  GRS shall
further  have the right at its  expense  to: (i)  procure  the right to continue
using the  infringing  item; or (ii) replace or modify the product or service so
that it becomes non-infringing.  The preceding provisions of this Paragraph 3(b)
describe GRS' entire  liability with respect to infringements of any trademarks,
copyrights or trade secrets by the Software or any related documentation.

                  (c) WARRANTY DISCLAIMERS.  EXCEPT FOR THE EXPRESS WARRANTY SET
FORTH IN PARAGRAPH 3(a) ABOVE, GRS MAKES NO WARRANTIES TO VALUESTAR OR ANY OTHER
PARTY REGARDING THE SERVICES AND THE APPLICATION SYSTEM AND HEREBY DISCLAIMS ANY
AND ALL IMPLIED  WARRANTIES  INCLUDING,  WITHOUT  LIMITATION,  ANY WARRANTIES OF
MERCHANTABILITY  OR FITNESS  FOR A  PARTICULAR  PURPOSE.  WITHOUT  LIMITING  THE
FOREGOING,  GRS DOES NOT MAKE AND  DISCLAIMS ANY WARRANTY THAT THE SERVICES WILL
SATISFY VALUESTAR'S BUSINESS  REQUIREMENTS OR ENSURE THAT VALUESTAR OR ANY OTHER
PARTY WILL NOT INCUR  LIABILITY OR LOSS IN CONNECTION  WITH ANY  CREDIT/DEBIT OR
PAYMENT CARD TRANSACTIONS.

                  (d)  Limitation  of  Liability.   Notwithstanding   any  other
provision of this Agreement, GRS and ValueStar expressly covenant and agree that
(except for GRS'  indemnification  liability described in Paragraph 3(b) of this
Addendum "B" and GRS' intentional  acts) in no event will GRS' maximum aggregate
liability for any loss, injury or damages, whether based in contract,  warranty,
tort, strict product liability or on any other basis, exceed one hundred percent
(100%)  of the  total  Fees  paid  by  ValueStar  to GRS  with  respect  to this
Agreement.  The provisions of this Paragraph 3(d) allocate the risk of a failure
or defect of the Software or any product or Service  provided by GRS pursuant to
this Agreement or any other agreement between or among ValueStar and GRS and are
an  essential  element  of the  Agreement  between  GRS and  ValueStar.  GRS and
ValueStar  acknowledge  and agree that the provisions of this Paragraph 3(d) are
the product and result of  arms-length  negotiation  in a commercial  setting by
sophisticated  business concerns of equal bargaining strength and position.  GRS
and  ValueStar  acknowledge  and agree that the Services  provided in accordance
with this  Agreement  shall be limited to obtaining,  receiving  and  accurately
processing  and  reformatting  data  relating to payment card  transactions  and
providing  information  and  reports  to  ValueStar  and  ValueStar's  Customers
(defined  below).  The Services  provided  pursuant to this Agreement  shall not
include any analysis or evaluation of the  information or reports which shall be
the  sole  and  exclusive  responsibility  of  ValueStar.   Notwithstanding  the
foregoing, neither party shall have liability for any failure or delay resulting
from any governmental  action,  fire,  flood,  insurrection,  earthquake,  power
failure, riot, explosion,  embargo, strike (whether legal or illegal),  labor or
material shortage, transportation interruption of any kind, work slowdown or any
other action beyond the control of the affected  party  effecting  production or
delivery of the Services in any manner (collectively, a "force majuere").

                                      -7-

<PAGE>


         4. Exclusive  Agreement.  GRS and ValueStar  acknowledge and agree that
all or portions of the Services and the information  and reports  generated with
respect to the Services will be provided directly or otherwise made available to
or used by ValueStar's  designated parties and customers (Members and Merchants)
(collectively,  "ValueStar's  Customers").  Notwithstanding  the foregoing:  (i)
nothing contained in this Agreement may be construed by any party as creating or
evidencing  a  contractual  relationship  between  GRS  and  any of  ValueStar's
Customers nor shall any of ValueStar's Customers be third party beneficiaries to
this  Agreement;  and (ii) ValueStar  shall be and remain solely and exclusively
responsible for the payment of all Fees under this Agreement.

         5. Title.  ValueStar  shall have sole  ownership  of, and title to, the
Member  Data  Base,   the  Merchant  Data  Base,   the  PQT  Databases  and  all
administrative  reports  prepared  by  GRS  and  furnished  to  ValueStar,   its
designees,  Members and Merchants pursuant to this Agreement (collectively,  the
"ValueStar Data"). GRS shall, at all times, maintain sole and complete ownership
of the  Software  and the  Application  System  and  nothing  contained  in this
Agreement  shall be  construed  as creating a license or any other rights on the
part of ValueStar or any of  ValueStar's  Customers in or to the Software or the
Application  System.  With respect to any raw transactional  data feeds that GRS
receives from processors or acquiring  institutions on behalf of ValueStar,  the
ownership  and  control of that data shall be  subject to  separate  contractual
agreements that may exist from time to time between or among GRS,  ValueStar and
the processors and/or acquiring institution. GRS will use the ValueStar Data for
the exclusive purpose of providing the Services to ValueStar.

         6. Use of Data,  Privacy and Misuse.  Both parties  recognize that both
(a) the  laws  and  regulations  affecting  "privacy"  on the  internet  and (b)
government and consumer  attitudes about such issues are in a continual state of
evolution. As a result, although both parties believe that the present agreement
is in  compliance  with all laws,  rules and  regulations,  each party agrees to
cooperate in good faith to modify this agreement as is necessary to meet revised
interpretations of current law (as well as modifications of current law) and the
intent of this  agreement and comply with all then current and  applicable  law,
rules, and regulations. If a change reasonably necessary to comply with the then
current laws, rules and regulations (or  interpretations  thereof),  is not made
within 60 days of ValueStar's  request,  or if such change would have a material
adverse  effect on  ValueStar's  operation,  cost of  supplying  data,  or other
benefit  ValueStar  could  reasonably  anticipate  from  this  agreement,   then
ValueStar may terminate the agreement effective as of the date the change should
have been made in order to cause the agreement to comply with applicable law and
interpretation.Each  party acknowledges that the other has expended  substantial
time, effort and funds to compile its, programming, software, database and other
information (collectively "Database") and that all information contained in such
Database  is  and  will  continue  to be the  exclusive  property  of the  party
maintaining it. Nothing contained in this Agreement shall be deemed to convey to
the  other,  any  third  party  processor  or other  party any  right,  title or
interest,  including any patent,  copyright or other proprietary right, in or to
the  Database  or any part  thereof  beyond that which is  specifically  granted
herein,  and then only subject to the restrictions  contained herein.  Except as
specifically  provided herein,  neither party will use, or permit its employees,
agents, contractors or subcontractors to use, the Database,  trademarks, service
marks, logos,  names, or any other proprietary  designations of the other or its
affiliates,  whether  registered  or  unregistered,  without the  other's  prior
written  consent.  Neither  party shall  reverse  engineer any of the  Database.
Neither  Party shall  divulge the  criteria  used for any program to any person,
except  employees and agents who have a need to know such  criteria.  Each party
will  retain all right,  title and  interest in and to its  trademarks,  service
marks and trade names worldwide,  including any goodwill  associated  therewith,
subject to the  limited  licenses  granted to the other  hereunder,  and neither
party shall take any action  that is  inconsistent  with the  other's  ownership
thereof. Each party hereby grants to the other a non-exclusive,  limited license
to use its  trademarks,  service  marks  or  trade  names  only as  specifically
described  in this  Agreement.  All such use  shall be in  accordance  with each
party's  reasonable  policies  regarding  advertising  and  trademark  usage  as
established  from  time to time.  Upon the  expiration  or  termination  of this
Agreement, each party will cease using the Database,  trademarks,  service marks
and/or trade names of the other.  Each party is aware of the privacy policies of
the other, as they are, from time to time, displayed on the party's webpage, and
agrees  to abide by them as to the  Database  as if the  other  party's  privacy
policy was their own.

         7. ValueStar Obligations.  During the Term of this Agreement,  and as a
prerequisite to GRS' obligation to provide Services, ValueStar shall provide GRS
(or ensure that GRS has access to) all payment card  transactional  information,
service criteria or informational  data of ValueStar,  its Merchants and Members
(as set-forth in the  Specification)  reasonably  required by GRS to provide the
Services  including,  but not  limited  to,  the  ValueStar  Transaction  Files.
ValueStar  shall  indemnify,  defend and hold GRS harmless for, from and against
any claim made against GRS by any of  ValueStar's  Customers  with respect to or
arising out of the  Services  rendered  pursuant to this  Agreement.  Subject to
ValueStar's  obligation  to make  the  minimum  monthly  payments  described  in
Paragraph 6 of  Addendum  "B",  ValueStar  shall have no  obligation  to use the
Application System.

                                      -8-

<PAGE>


         8. Entire Agreement; Modification. This Agreement represents the entire
agreement of the parties with  respect to the subject  matter of this  Agreement
and  supersedes  all  other   agreements,   whether  written  or  oral  and  any
representations  made by either of the parties to the other.  This Agreement may
not be changed,  modified or rescinded except in writing, signed by both parties
to this Agreement.  Notwithstanding  the foregoing,  the parties acknowledge and
agree that  Confidentiality  Agreement  between GRS and ValueStar  dated May 22,
2000,  shall  remain  in full  force and  effect  after  the  execution  of this
Agreement and the ValueStar Data shall become  Confidential  Information for all
purposes under the referenced Confidentiality Agreement.

         9.  Rights  to Source  Code.  In the  event  GRS (or any  successor  in
interest to GRS with respect to the  Application  System) ceases or discontinues
operations or,  without  cause,  refuses to provide the Services to ValueStar as
required by this  Agreement or this  Agreement is  terminated  by ValueStar as a
result of a material breach by GRS,  ValueStar will, subject to the restrictions
on use,  duplication and dissemination set forth in this Agreement,  be entitled
to immediately receive the source code for the Software and any other supporting
documentation  relating the Application System reasonably  required by ValueStar
to continue to operate a similar  system.  For the purpose of this  Paragraph 9,
the term "source code" will mean a human  readable  program for the most current
release(s)  of the Software  utilized by GRS in  connection  with  providing the
Services,  including all updates and enhancements delivered during the Term. Any
time during the Term,  ValueStar shall have the option to establish an escrow to
hold the source code  subject to  appropriate  terms and  conditions  reasonably
agreed  to  by  both  parties.  All  costs  and  expenses  associated  with  the
establishment of the escrow, including,  without limitation, any escrow fees and
any additional  fees or expense  incurred by GRS in connection  with creating or
maintaining  source  code  within  the  escrow  shall  be  born  exclusively  by
ValueStar.

         10. Intentionally Omitted.

         11. Miscellaneous. This Agreement shall be governed by and construed in
accordance  with the laws of the  substantive  laws of the State of Arizona.  If
suit is brought or an attorney is retained by either party to this  Agreement to
enforce the terms of this Agreement,  the prevailing  party shall be entitled to
recover,  in addition to any other remedy,  reimbursement  for actual reasonable
attorney's  fees,  court  costs,  reasonable  costs of  investigation  and other
reasonable related expenses incurred in connection with such action. The parties
consent and agree to submit to the venue and  jurisdiction  of the United States
District  Court for the  District of Arizona.  Except as  specifically  provided
below, this Agreement and the rights of ValueStar under this Agreement shall not
be assignable  (directly or indirectly)  except with the written  consent of GRS
not unreasonably  withheld.  Notwithstanding the prior sentence,  ValueStar may,
upon providing  written notice of such  assignment to GRS, assign its rights and
obligations  under this Agreement to a separate  entity if it also transfers its
entire ownership of and  responsibility  for the Program to the same entity. GRS
may, upon providing  written notice of such assignment to ValueStar,  assign its
rights under this Agreement to a successor  entity that, by purchase,  merger or
otherwise,  takes over and  assumes  responsibility  for GRS'  entire  bank card
information  and  processing  business  including  GRS'  obligations  under this
Agreement.

         12.  Performance  Standards.  Except  as  otherwise  specified  in this
Agreement,  GRS will deliver all Services  required under this Agreement  within
twenty four (24) hours of receiving all required data inputs.

         13. Records.  GRS shall keep complete and accurate  records relating to
the Fees charged to ValueStar in connection  with this Agreement for a period of
two (2) years following the applicable billing  period(s).  ValueStar shall have
the right, at its own cost and expense,  to audit GRS' billing records from time
to time  during  the  Term,  but no more than once  every  six (6)  months  (the
"ValueStar Audit").  Any ValueStar Audit will be conducted by a Certified Public
Accountant  in a manner so as not to  unreasonably  interfere  with GRS'  normal
day-to-day  business  operations and upon at least ten (10) business days' prior
notice. If any ValueStar Audit  demonstrates  that GRS overcharged  ValueStar by
more than  five  percent  (5%)  during  the  audit  period,  GRS  shall,  within
forty-five (45) days following the conclusion of the audit,  reimburse ValueStar
for the full amount  overcharged,  together  with the  reasonable  costs of such
audit. If less than 5%, GRS will reimburse the overpayment amount.

         14. Mutual Representations and Warranties.  ValueStar and GRS represent
and Warrant to each other that: (i) each party shall operate in compliance  with
all applicable laws and regulations, except where failure to do so would have no
material  affect on the other  party;  (ii) each party is a  corporation/limited
liability  company duly organized,  validly  existing and in good standing under
the laws of the State of its  formation;  (iii)  each  party has full  power and
authority to enter into this Agreement and to perform the obligations imposed by
this  Agreement;  (iv) each party has obtained  all permits,  licenses and other
governmental  authorizations  and approvals  required to perform its obligations
under this Agreement;  (v) this Agreement has been duly and validly executed and
delivered and constitutes a legal, valid and binding obligation,  enforceable in
accordance with its terms; (vi) the execution,  delivery and performance of this
Agreement  and  the  consummation  of  the  transactions  contemplated  by  this
Agreement will not, with or without the giving of notice,  the lapse of time, or
both,  conflict with or violate (A) any  provisions of law, rule or  regulation,
(B) any  order,  judgement  or  decree  applicable  or  binding  upon  assets or
properties,

                                       -9-

<PAGE>


(C) any  provision  of the  by-laws  or  certificate  of  formation,  or (D) any
agreement or other  instrument  applicable or binding upon assets or properties;
(vii) no consent, approval or authorization of, or exemption by, or filing with,
any governmental authority or any third party is required to be obtained or made
in connection  with the execution,  delivery or performance of this Agreement or
the taking of any other action  contemplated by this Agreement;  (viii) there is
no pending or, to the best of each parties' knowledge,  threatened claim, action
or proceeding against it with respect to the execution, delivery or consummation
of this  Agreement  or with respect to its  trademarks,  and, to the best of its
knowledge, there is no basis for such claim, action or proceeding.

         15.  Contract  Disclosure.  GRS is  specifically  denied  permission to
disclose  that  ValueStar  is a client  or that  ValueStar  in any way uses GRS'
services.  Without limiting the foregoing, GRS may not include ValueStar's name,
logo,  trademark or description  of the ValueStar  business or business model in
any (i) GRS client reference list, (ii) GRS press release, (iii) discussion with
members  of the  press,  and (iv)  discussion  with  persons  outside  GRS.  The
foregoing  notwithstanding,  (a) GRS may, pursuant to court order,  disclose the
relationship  if the  disclosure  is in  response to a valid order by a court or
other  governmental  body,  is  otherwise  required by law, or is  necessary  to
establish  the  rights of either  party  under this  Agreement;  and (b) GRS may
disclose the relationship with the prior written consent of ValueStar,  given by
the CEO,  President,  Chairman of the Board,  or General  Counsel of  ValueStar,
which consent may be withheld in ValueStar's sole discretion.

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