Agreement for Backroom Services and Organizational Efficiency Services - Nova Financial Corp. and Atlanta Internet Bank
NOVA
Financial Corporation
NOVA FINANCIAL CORPORATION'S
AGREEMENT FOR
BACKROOM SERVICES
AND
ORGANIZATIONAL EFFICIENCY
SERVICES
FOR:
ATLANTA INTERNET BANK
June 10, 1997
8601 Dunwoody Place Suite 146 Atlanta, GA 30350 (770) 992-1006
Fax (770) 992-1199
<PAGE>
AGREEMENT FOR DATA PROCESSING SERVICE
This Agreement, dated the 16th day of June, 1997 sets forth the terms and
conditions under which NOVA FINANCIAL CORPORATION ("NOVA") having its
principal place of business at 8601 Dunwoody Place, Suite 146, Atlanta, GA
30350, will provide computer and related services for the processing of
financial, banking or economic data ("Services") to Atlanta Internet Bank,
("Client") (collectively, the "Parties").
1. Term
This Agreement shall commence as of the date services are first used by
the Client, (the Effective Date), and shall continue for a period of
five (5) years. The Agreement shall automatically be renewed for
successive three year periods in the absence of written notice to
terminate given by either Party not less than one hundred eighty (180)
days prior to the expiration of the initial or any subsequent term.
2. Services
The Schedules identified below delineate the Services that are available from
Nova under this Agreement. These Schedules are attached hereto and are
incorporated herein by reference.
(1) Schedule A: General Services and Pricing
(2) Schedule B: Disaster Recovery Services and Pricing
(3) Schedule C: Processing Services and Pricing
(4) Schedule D: Implementation Fee
(5) Schedule E: Back Office Processing
(6) Schedule F: Termination Charges
3 Service Charges and Payment Terms
a. Nova's charges for Services performed under this Agreement are
indicated in the attached Schedules. All invoices shall be
accompanied by a report in such form and format and containing
such information as is reasonably required by Client to evidence
the manner in which the amounts due hereunder were calculated
and which permit Client to verify such amounts.
b. All charges will be invoiced monthly and paid within thirty (30)
days after the invoice date (Due Date). Nova will apply a
service charge of one and one-half percent (I 1/2%) per month or
the maximum rate allowable by law, whichever is lower, of any
unpaid balance not received at Nova, c/o Accounts Payable, 8601
Dunwoody Place, Suite 146, Atlanta, Georgia 30350 by the Due
Date. Should Nova's monthly charge remain unpaid for a period of
sixty (60) days after the Due Date, Nova shall have the right,
at Nova's sole discretion, to terminate this Agreement in
accordance with Section 6.a.
c. The charges shown in the attached Schedules may be revised,
provided Nova gives Client at least ninety (90) days written
notice prior to the Effective Date of such revision. No charge
shall be revised for twelve (12) months after the Effective Date
of this Agreement or for one (1) year from the Effective Date of
any such revision. Such
<PAGE>
revisions, if any, shall be limited to a maximum increase of ten
percent (10%) per year or the rise in the Consumer Price Index,
whichever is the lesser. Notwithstanding the foregoing,
processing charges as defined in Schedule C, Section 3 and will
remain fixed for twelve (12) months after the Effective Date of
this Agreement, unless modified by an addendum to this
Agreement.
d. The charges shown in the attached Schedules are exclusive of
taxes. Client shall pay all taxes applicable to Services
performed by Nova under this Agreement, other than taxes based
on Nova's net income.
e. If a good faith dispute arises between the Parties, Client shall
have the right to withhold any disputed payment due to Nova
pursuant to this Agreement for the forty (40) day time period
set forth in Section 15 for as long as Client follows the
dispute resolution procedures contained therein. Written notice
of such dispute and Client's intent to withhold payment shall be
provided to Nova within five (5) business days after Client's
receipt of Nova's invoice which contains the disputed charge and
from which payment is to be withheld. Client and Nova shall work
together to resolve any such dispute in accordance with Section
15. The provisions in subsection 3.b for late charges or
termination of Service shall not be invoked for any disputed
charge which is withheld in accordance with this subsection 3.e
and Section 15.
4. Confidential Data
a. Each Party (i) must receive and hold the Confidential
Information (as defined below in Section 4.c) of the other Party
in trust and in strictest confidence; (ii) must protect such
Confidential Information from disclosure and in no event take
any action causing, or fail to take the action necessary in
order to prevent, any such Confidential Information to lose its
character as Confidential Information; and (iii) must not use,
reproduce, distribute, disclose or otherwise disseminate the
Confidential Information of the other Party except to perform
the Services. Any and all reproductions of such Confidential
Information must prominently contain a confidentiality legend.
b. Disclosures of the Confidential Information of the other Party
may be made only to employees, agents or independent contractors
of the receiving Party (a) who are directly involved in
performing the Services and have a specific need to know such
information; and (b) whom the receiving Party has obligated
under a written Agreement to hold such Confidential Information
in trust and in strictest confidence and otherwise to comply
with the terms of this Agreement. The Parties agree to
diligently monitor each such employee, agent or independent
contractor and, upon request by the other Party, promptly to
furnish to the other Party a certified list of the receiving
Party's employees, agents and independent contractors having had
access to such Confidential Information.
c. As used herein, the term "Confidential Information" means
information related to the Services or the business of the
disclosing Party or its affiliates that (1) derives economic
value, actual or potential, from not being generally known to or
readily ascertainable by other persons who can obtain economic
value from its disclosure or use; and (2) is the subject of
efforts by the disclosing Party or its affiliates that are
reasonable under the circumstances to maintain its secrecy,
including without limitation
-2-
<PAGE>
(I) marking any information reduced to tangible form clearly and
conspicuously with a legend identifying its confidential or
proprietary nature; (ii) identifying any oral presentation or
communication as confidential immediately before such oral
presentation or communication; or (iii) otherwise treating such
information as confidential. Assuming the criteria in clauses
(1) and (2) above are met, Confidential Information includes,
but is not limited to, technical and non-technical data related
to the formulas, patterns, designs, compilations, programs,
inventions, methods, techniques, drawings, processes, finances,
actual or potential customers and suppliers, research,
development and existing and future products, the existence,
nature and details of the relationship between the Parties, and
employees of the disclosing Party and its affiliates.
Confidential Information also includes information that has been
disclosed to Nova or Client by a third party that Nova or Client
is obligated to treat as confidential.
d. Confidential Information does not include any data or
information that (1) is already known to the receiving Party at
the time it is disclosed to the receiving Party by the
disclosing Party; (2) is disclosed by the receiving Party
pursuant to a requirement of a governmental agency or of law
without similar restrictions or other protections against public
disclosure or is required to be disclosed by operation of law;
provided, however, that the receiving Party shall have first
given written notice of such required disclosure to the
disclosing Party, made a reasonable effort to obtain a
protective order requiring that the Confidential Information so
disclosed be used only for the purposes for which disclosure is
required and taken reasonable steps to allow the other Party to
seek to protect the confidentiality of the information required
to be disclosed; or (3) before being divulged by the receiving
Party (i) has become generally known to the public through no
wrongful act of the receiving Party; (ii) has been rightfully
received by the receiving Party from a third party without
restriction on disclosure and without, to the knowledge of the
receiving Party, a breach of an obligation of confidentiality
running directly or indirectly to the disclosing Party; (iii)
has been approved for release to the general public by a written
authorization of the disclosing Party; (iv) has been
independently developed by the receiving Party without use,
directly or indirectly, of the Confidential Information received
from the disclosing Party; or (v) has been furnished to a third
party by the disclosing Party without restrictions on the third
party's rights to disclose the information.
e. That portion, if any, of the Confidential Information that
constitutes trade secrets shall be subject to this Section 4 for
such period as it shall qualify as trade secrets under
applicable law. The remainder of the Confidential Information
shall be subject to this Section 4 during the term and for a
period of two years after the expiration or earlier termination
of this Agreement.
f. During the course of this Agreement, either Party may gain
access to software and related documentation which is owned by
the other Party or, if licenses to the other Party, to the
extent such access is authorized under the applicable license.
Both Parties recognize the proprietary nature of such software
and related documentation, and agree to maintain the
confidentiality of and not to disclose such software and related
documentation to any third party and not to use such software or
related documentation for any other purpose not contemplated by
this Agreement. Provided, however, that the foregoing shall not
apply to information (a) that was within Client's possession
prior to disclosure by Nova,
-3-
<PAGE>
(b) which is or becomes known to the industry through no fault
of Client, and (c) which is disclosed to Client by a third party
having legitimate possession thereof and the right to make such
disclosure.
g. Nova will not be responsible for the security of data during
transmission via public communications facilities if the breach
of security occurred through access to the public communications
facilities, except to the extent that such breach of security is
caused by the failure of Nova to perform its security
obligations under this Agreement, or the negligent acts or
omissions of Nova.
5. Maintenance of Records and Examinations
a. Nova shall permit Client's duly authorized representative to
examine internal control and accounting related to Services
provided to Client under this Agreement, subject to the audit
procedures defined in Section 16.
b. Upon written request from Client, Nova shall provide to
regulatory authorities or other third parties, any reports or
summaries of information contained in, or derived from, the data
in the possession of Nova relating to Client.
c. Nova shall bill Client at the rates specified in the attached
Schedules for any Nova resources used in providing support or
information to Clients representatives or to regulatory agencies
requesting information pertaining to Client.
d. Client shall be responsible for confirmation that adequate
insurance coverage is in place to protect Client and Nova from
employee dishonesty while processing Client's data at levels
satisfactory to applicable banking regulatory authorities.
Client shall furnish proof of such insurance coverage within 30
days of the signing of this Agreement.
e. Client agrees that in the event Client requests programming
changes to the system for Client's specific benefit, Client
shall submit such request in writing, defining such changes
requested and duly authorize such changes be made. Provided such
changes are unique to client's own needs and, in Nova's
discretion, not made available to Nova's general client
population through a new release or version, Client will be
billed in accordance with the provisions of Schedule A, "General
Services and Pricing". Client shall have the right to propose
changes and enhancements which may be applicable to the general
client population through a new release or version. If such
changes are approved and incorporated into the software through
a new release or version, Client's charges will be limited to
the applicable rate increases to Nova's other clients; subject
to the provisions of Section 3.c hereof. Nova may offer new
products to its clients which may be the result of client input
and/or market research. Notwithstanding any provisions of this
Agreement, Nova reserves the right to offer such new products
and/or services to Client and Nova's other clients and to charge
for such products/or services at a price accepted by Client
and/or Nova's other clients. Neither Party will be restricted in
using any data processing or network management ideas, concepts,
know-how and techniques, (including without limitation, in the
development, manufacturing and marketing of its products and
services and in its operations) which are retained in the minds
of employees who have had access to the Confidential Information
of such Party without reference to
-4-
<PAGE>
any physical or electronic embodiment of such information,
unless such use shall infringe any of such Party's patent
rights, copyrights or mask work rights.
6. Termination
a. Nova may terminate its future obligations under this Agreement
at any time by twenty (20) days prior written notice to Client
in the event of failure of Client to make payments of amounts
due Nova in a timely manner, provided such failure is not cured
within ten (IO) days of Client's receipt of such notice. Should
termination be effected pursuant to this subsection 6.a.,
Client. agrees to pay the termination fees to be calculated as
set forth in Schedule G.
b. Either Party shall have the right to terminate this Agreement
upon the other Party's material breach of this Agreement,
provided the Party seeking to terminate provides written notice
to the other Party staffing the grounds for such termination in
full detail. The Party receiving such notice shall have forty
five (45) days in which to cure the default, or, if the default
is such that ft cannot be cured within forty five (45) days, to
take corrective measures satisfactory to the Party seeking to
terminate; provided, however, if any material breach by Nova
results, or is likely to result, in a material adverse effect on
Clients business operations, Nova shall have five (5) business
days, or other mutually agreed upon time, to cure such default.
c. If Client elects to terminate this Agreement for any reason
other than for material breach as set forth in Section 6.b,
Client may do so upon at least 180 days prior written notice to
Nova and payment of the applicable charges set forth in Schedule
F.
d. In the event of termination or expiration of this Agreement, and
in addition to any termination charges, Client shall reimburse
reasonable costs incurred by Nova at the then-current machine
and personnel rates for transition assistance in transferring
Client's data to another service center or directly to Client.
Nova *II fully cooperate and furnish assistance to such
transferring of Clients data on a timely basis. Nova will notify
Client of the estimated time and charges to transfer Client's
data to the other service center or to Client. Nova will bill
the estimated cost in three (3) equal installments during the
last three (3) months Client is being serviced by Nova, except
that the last billing will include a credit or additional charge
as necessary to reflect the actual costs incurred either below
or above the original estimate. If Client terminates with less
than three (3) months notice, Client will pay the estimate or
actual costs to transfer client's data prior to the completion
of data transfer.
e. Upon completion of Client's final day of production processing
at Nova, Nova shall prepare Client's final data for delivery to
Client in the format agreed to during the deconverstion period.
Nova shall also prepare a final invoice for services rendered up
to and including Client's final day of production processing and
shall advise Client of the amount due by telephone. Such amount
shall be due immediately upon delivery of Client's final data to
Client.
f. Should Client be subject to regulation by any federal and/or
state regulatory authority which requires notification of
termination of this Agreement, Client agrees to provide such
notification as required by such authority.
-5-
<PAGE>
g. Should this Agreement be scheduled to terminate and should
Client wish to extend the term of the Agreement for a limited
period on a month-to-month basis, Client may do so by requesting
such extension in writing. Nova will continue to provide
Services to Client beyond the originally scheduled termination
date at the rates then in effect under this Agreement plus an
extension surcharge equal to twenty percent (20%) of Client's
total monthly charge.
7. Limitation of Liability
a. Nova does not warrant that any advice, report, data or other
product delivered to Client will be error free. Subject to the
commitments contained in this Agreement, Nova does not assure
uninterrupted or error-free operation of any system. Client is
responsible for auditing, balancing, verifying the correctness
of calculation routines (such as interest and service charges)
and reconciling any out-of-balance condition, and for notifying
Nova of any errors in the foregoing within three (3) business
days after receipt of the incorrect information.
b. To the extent that Nova furnishes any items of hardware or
licenses for third party hardware or software pursuant to this
Agreement ("third party materials"), Nova agrees to pass on to
Client the manufacturer's or supplier's warranties to the extent
that Nova is contractually able to do so, Those third party
warranties are Client's exclusive remedies with respect to Third
Party Materials.
c. Except as expressly set forth in this Agreement, Nova makes NO
OTHER REPRESENTATIONS, WARRANTIES OR GUARANTEES, EXPRESS OR
IMPLIED, IN FACT OR IN LAW, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE.
d. Neither Party shall be liable to the other in contract, tort,
for breach of warranty or otherwise, for any special,
consequential, exemplary or punitive damages arising from any
act or omission of such Party, or its affiliates, officers,
agents and employees, even if ft has been advised of the
possibility of such losses or damages.
e. Nova shall maintain backup copies of Clients data in accordance
with good industry practice and the terms of this Agreement.
However, Nova shall in no circumstances have any liability for
the loss or destruction of, or for corruption or disclosure of
any of the Client's data caused by Client's acts or omissions,
the acts or omissions of third parties (excluding subcontractors
authorized to perform any of the Nova Services), circumstances
constituting force majeure, or circumstances arising from
transmission over public telecommunications lines or
transportation via commercial carriers.
f. Notwithstanding the form in which any claim or action may be
brought or asserted, Nova's total liability for any acts or
omissions arising from or relating to the performances of this
Agreement shall be limited to Nova furnishing the correct report
and/or to correct the applicable client files, provided that
Client promptly advises Nova hereof. Nova shall in no
circumstances have any other financial liability to Client
whatsoever. Client agrees that the provisions of this Section 7
limiting its remedies and
-6-
<PAGE>
liquidating its damages are reasonable in the circumstances
existing on the date of this Agreement.
g. The foregoing limitations shall not apply to Claims (defined
below) to the extent that they are covered losses under the Nova
comprehensive general liability or other applicable policy.
Nova's liability for such covered losses shall be limited to the
amount, if any, if and to the extent the loss is paid by the
policy carrier. Nova agrees that it is obligated throughout the
term of this Agreement to maintain insurance as set forth in
Section 13, so long as such coverage is available to insureds in
Nova's business at commercially reasonable rates.
h. Neither Party shall be responsible for any resulting loss if
fulfillment of any of the terms or provisions of this Agreement
is delayed or prevented by causes beyond that Party's reasonable
control including, but not limited to, fire, flood, earthquake,
act of God, war, insurrection, national emergency, or strike.
i. Client agrees to defend and indemnify Nova against any claims or
suits brought by any customer of Client resulting from or
arising out of services performed by Nova under this Agreement,
unless the liability in such claim or suit is determined to be
the result of Nova's negligence or breach of Nova's duties under
this Agreement. Provided, however, that (a) Nova notifies Client
in writing of any such claim or action within 15 days of the
date Nova becomes aware of the same, (b) Client has the right to
control the defense of such claim or action, or any settlement
thereof, and Nova reasonably cooperates with Client, at Client's
expense, in connection therewith; provided, further, that Nova
may participate in such defense at its own expense.
j. Upon expiration or termination of this Agreement, neither Party
may bring an action, regardless of form, arising out of this
Agreement more than two years after the cause of action has
arisen or the date of discovery of such cause, whichever is
later provided however, that Nova may bring an action for
nonpayment at any time.
8. Testing and Acceptance
Nova, in cooperation with Client, will provide all necessary data
conversion, and will implement and test Nova's computer systems used to
provide the Services.
9. Training: User Documentation
Nova will provide the training for the system at two levels as follows:
a. System Overview will present the overall system, general system
features, logon instruction, and main menu usage.
b. Features and Functions will present the capabilities of the
system from the perspective of a user department. Bankline
Mid-Ame6ca, Inc. documentation will be used as a reference.
Applicable employees will be presented with case studies which
require them to inquire and enter data in a test bank
environment using terminals. Course material includes
maintenance of the Central Information File, as well as material
specific to each application.
-7-
<PAGE>
All training will be presented by instructors on Client's premises. The
charge for training, except for out of-pocket expenses, is included in
the conversion fee as set forth in Schedule E. Nova will bill Client for
reasonable travel and living expenses for instructors teaching courses.
All course materials will be furnished by Nova.
Nova will also provide Client with all user and operational
documentation reasonably required to obtain and utilize the Services.
Client may make copies of such documentation for its own use, provided,
however, that it reproduces the copyright and other notices of Nova set
forth on such documentation.
Client agrees to distribute copies only to employees of Client and to
regulatory agencies, as required. Upon termination or expiration of this
Agreement, Client will return to Nova all documentation in the
possession of Client.
10. Ownership of Data
The Parties acknowledge that all data provided by Client to Nova, and
all data produced, compiled or otherwise provided by Nova for Client, in
any form or format, is the sole and exclusive property of Nova, and
copies thereof shall be provided to Client at its request from time to
time or at any time. Client shall reimburse Nova for its reasonable
costs for reproduction and delivery of such data to Client.
11. Infringement
Nova will defend, indemnify and hold harmless Client from and against
any and all loss, cost, claim, demand or expense arising out of any
claim or action that Client's use of the Services or Nova's provision of
the Services to Client infringes a United States patent, or any
copyright, trade secret right or other proprietary right of any person,
firm or entity. Provided, however, that (a) Client notifies Nova in
writing of any such claim or action within 15 days of the date Client
becomes aware of the same, (b) Client does not make any admission
without Nova's prior written consent, and (c) Nova has the right to
control the defense of such claim or action, or any settlement thereof,
and Client reasonably cooperates with Nova, at Nova's expense, in
connection therewith; provided, further, that Client may participate in
such defense at its own expense.
12. Regulatory Compliance
Nova represents and warrants that it will comply with all applicable
federal, state and local laws with respect to its performance of the
Services hereunder. Nova further represents and warrants that all the
Services, including, without limitation, all processing performed as
part of the Services, and all materials provided to Client or its
customers as part of the Services, will comply with all applicable
federal, state and local law.
13. Insurance
Without limiting any obligation of Nova under this Agreement, Nova shall
maintain the following insurance at levels satisfactory to applicable
banking regulatory authorities, together with any insurance required
under applicable federal or state law, rules or regulations: (a)
-8-
<PAGE>
employer's liability and workers' compensation insurance, (b)
comprehensive general liability insurance, personal injury and property
damage insurance, (c) errors and omissions insurance, and fidelity bond
insurance insuring against losses resulting from fraud, dishonesty,
conversion, forgery and other similar acts.
14. Additional Equipment
Except as otherwise provided in the Agreement, Nova warrants that ft
will obtain and maintain all computer equipment and peripherals
necessary to perform the Services as provided herein.
15. Dispute Resolution
a. Any dispute between the Parties either with respect to the
interpretation of any provision of this Agreement or with
respect to the performance by Nova or by Client hereunder shall
be resolved as follows:
(1) Upon the written request of either Party, each of the
Parties will designate a representative whose task it
will be to negotiate in good faith and to resolve such
dispute.
(2) If the designated representatives cannot resolve such
dispute within twenty (20) calendar days, then the
dispute shall be escalated to the President of Client
and the President of Nova, for their review and
resolution.
b. If the dispute cannot be resolved by such officers within twenty
(20) calendar days, then the Parties may initiate formal
proceedings; however, formal proceedings for the resolution of
any dispute may not be commenced until the earlier of:
(1) the designated representatives concluding in good faith
that amicable resolution through continued negotiation
of the matter in issue does not appear likely; or
(2) forty (40) days after the initial request to negotiate
such dispute; or
(3) thirty (30) days before the statute of limitations
governing any cause of action relating to such dispute
would expires.
c. Notwithstanding anything to the contrary contained in this
Section 15, the pendency of this dispute resolution procedure
shall not prevent either Party from seeking equitable relief
with respect to a dispute prior to such period.
16. Audits
a. EDP Audits. On an annual basis, Nova will engage an independent
and qualified firm to conduct an Electronic Data Processing
audit of Nova, based upon industry and regulatory standards.
Nova will provide a copy of such audit(s) to Client within 60
days of receipt by Nova.
b. Audit Procedures. Nova shall permit Client, or Client's
authorized representatives, to have access to Nova's records
regarding the Services provided under this Agreement in
-9-
<PAGE>
order to verify the amounts due hereunder. Such access will
require not less than two business days prior written notice to
Nova and will be provided during normal business hours, provided
that any audit does not interfere with Nova's ability to perform
the Services. Nova will provide access to information reasonably
necessary to perform the audit. Nova shall not allow Client, its
examiners or auditors access to Nova's proprietary data. Nova
will also assist Client's employees or auditors in testing
Client's data files and programs, including, without limitation,
installing and running audit software, subject to Client's
reimbursing Nova for its resulting expenses incurred.
17. Attorney's Fees and Costs
Should either Party be required to bring an action to enforce any of the
terms or provisions of this Agreement, the prevailing Party in such
action shall be entitled to reimbursement by the other Party of all
reasonable costs incurred as a result of such action, including
reasonable attorney's fees and other related costs.
18. Non-Employment Provision
Neither Party to this Agreement shall solicit for hire any employee of
the other contacted as a result of this Agreement during the term of
this Agreement and for a period of one year thereafter, except by
written consent of the other unless modified by an addendum to this
Agreement.
19. Use of Client's Name
Client hereby agrees to allow Nova to use Client's company name in press
releases, direct mail and other advertising related to the Services of
this Agreement. Client shall have the right to review and approve any of
the material using Client's name poor to its use and/or distribution.
20. General
a. This Agreement constitutes the entire agreement of the Parties
and supersedes all prior proposals or agreements, written or
oral, and all other communications and representations between
the Parties relating to the subject matter hereof.
b. Except as otherwise specifically provided herein, any notice
required or permitted to be given by a Party pursuant to this
Agreement must be given in writing and personally delivered or
mailed to the other Party by certified mail, return receipt
requested, at the address set forth below the signature of its
duly authorized officer on this Agreement or at such other
address as such Party will designate by written notice given in
accordance with this Section 20, Any notice complying with this
Section 20 will be deemed received upon three (3) days following
the post marked date, if sent by mail.
c. Except as set forth in this Section 20, all rights and
obligations of the Parties under this Agreement shall
immediately cease and terminate upon the termination of this
Agreement and Nova will have no further obligation to the Client
or its employees, agents or independent contractors with respect
to this Agreement.
-10-
<PAGE>
d. No modification or amendment of this Agreement shall be valid
unless such modification or amendment is in writing and duly
executed by both Parties.
e. The rights and obligations of the Parties pursuant to Sections
3, 4, 5, 7, 10, 11, 12, 1 5, 1 7, 18 and 20.k of this Agreement
will survive expiration or termination of this Agreement and
such expiration or termination shall not relieve either Party of
its obligations to observe. keep and perform those surviving
covenants, terms and conditions.
f. If any term, provision, covenant, or condition of this Agreement
is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the provisions shall remain
in full force and effect and shall in no way be affected,
impaired or invalidated.
g. The rights and obligations of the Parties herein are not
assignable without the express written consent of the other
Party. Such consent shall not be unreasonably withheld.
h. Nothing in this Agreement shall be construed so as to constitute
any Party hereto as a partner or joint venturer, or agent of any
other Party hereto.
i. The waiver by one Party of a breach of any provision of this
Agreement by the other Party will not operate or be construed as
a waiver of any subsequent breach of the same or any other
provision by the other Party.
j. To the extent that any of the terms and conditions of this
Agreement conflict with any of the terms and conditions
contained in any Schedule hereto, the terms and conditions of
this Agreement control.
k. This Agreement shall be construed in accordance with, and
governed by, the laws of the State of Georgia.
21. Miscellaneous
In the event that Client is unsuccessful in establishing an independent
charter in Georgia as contemplated, the Client shall be entitled to
terminate this Agreement upon written notice to Nova. Clients then
obligations hereunder shall be limited to fees paid for services
rendered under this Agreement to date and any expenses incurred by Nova
to date.
NOVA FINANCIAL CORPORATION ATLANTA INTERNET BANK
BY:/s/ BY:/s/ Belinda L. Morgan
------------------------------- -----------------------------
TITLE: President TITLE: Director of Operations
------------------------------- --------------------------
DATE: June 16, 1997 DATE: June 13, 1997
------------------------------- --------------------------
-11-
<PAGE>
SCHEDULE A
GENERAL SERVICES AND PRICING
1. Client Services
a. An assigned Account manager who will provide the following
services:
- Scheduled visits to Client's site at least on a monthly
basis
- Participation in project planning and status review
- Problem resolution
- Assistance in meeting Client's needs
- Awareness of Nova capabilities and industry trends in
application development
- Available and on-call to Client executive management
b. Complete problem management capabilities, including:
- Customer Support staff
- Problem tracking
- Executive escalation
- On demand status reporting
Standards for telephone problem resolution will include the
following:
(1) Telephone support will be available from 8:00 a. m. to
5:00 p. m., Eastern Standard Time, Monday through
Friday, except for holidays.
(2) Telephone support will be offered on an emergency basis
after normal hours and on weekends.
(3) Calls will be handled as quickly as possible, with the
goal being to respond to all calls in one hour or less.
(4) Operational assistance of non operating system nature in
the event of system downtime.
(5) Classification of reference manual material.
2. Online Service
a. Regular Service Hours (Eastern Standard Time):
From To
Monday 0800 1800
Tuesday 0800 1800
Wednesday 0800 1800
Thursday 0800 1800
Friday 0800 1800
Saturday 0800 1300
-12-
<PAGE>
In order to meet these time schedules, Client work must be received in
Nova's processing center not later than 6:00 p.m. daily. In the event of
delay, client may experience a delay in availability of on-line access.
Subject to Nova receiving Client's work on a timely basis and except for
system failure due to reasons beyond Nova's control, Nova warrants that
it will provide on-line service to Client of at least 95% of the regular
service hours set forth herein.
Should Client remote capture its data, Client must transmit balanced
files to Nova not later than 6:30 p.m., Eastern Standard Time. In the
event of delay in transmission, Client may experience a delay in
availability of on-line access. Subject to Nova receiving Client's
balanced files on a timely basis and except for system failure due to
reasons beyond Nova's control, Nova warrants that it will provide online
service to Client of at least 95% of the regular service hours set forth
herein.
b. Extended Service Hours:
Time requested to compensate for host site downtime which
occurred that same day (not to exceed a period of time equal to
the outage):
c. Other Service Hours:
Nova will, as scheduling permits, provide and bill for online
service hours outside those defined as "Regular Service Hours".
All such charges below shall be prorated to the nearest 10
minutes.
(1) Additional time scheduled at least 24 hours in advance:
$_____ per elapsed hour.
(2) Additional time scheduled within 24 hours of request:
$_____ per elapsed hour.
(3) Sunday and Holiday time scheduled. (Holidays for which
Nova assesses a surcharge are Washington's Birthday,
Memorial Day, Independence Day, Veteran's Day, Columbus
Day, Labor Day, Thanksgiving Day, Christmas Day, and New
Years Day):
Minimum of 8 hours at $_____ per day.
3. Software Development
All Nova activity requested and approved by Client will be billed at the
rates shown below unless the client and Nova have agreed to a fixed
price for a specific project.
a. Professional Rates: $_____ per hour
b. Resource Utilization Rates: See Schedule C
-13-
<PAGE>
4. Forms
All custom forms will be billed at ________ as Nova is invoiced by the
forms vendor. Client reserves the right to provide all custom forms or
contract independently for forms subject to specifications acceptable to
Nova.
5. Third Party Services
Client shall pay all reasonable travel and associated expenses incurred
by Nova as a result of services provided under this Agreement.
6. Third Party Services
a. All Third Party Services not specifically addressed elsewhere in
this Agreement will be billed to Client at _________ as Nova is
invoiced by each vendor.
b. Should Client request that Nova contract with a third party
vendor for an extended term in order to obtain more favorable
rates for any lines, modems or other equipment, Nova and Client
shall enter into an Addendum to this Agreement relative to such
third party contract.
c. Third party services contracted by Client and invoiced directly
to Client shall not be subject to surcharge by Nova. If
contracted services are billed through Nova a surcharge of
_____% will be assessed to Client.
7. Special Results
Should Client require services other than those specifically addressed
in this Agreement, Client should request such service in writing from
Nova. Nova will prepare a proposal relative to the provision of such
service. Generally, these proposals are provided without charge. In some
cases, the complexity of the request may require Nova to assess a charge
for preparation of the proposal but only in the event the proposal is
rejected by Client. Prior to developing any complex proposal, Nova will
notify Client that there will be a charge for development of the
proposal, but that such charge will be assessed only if the proposal is
rejected.
-14-
<PAGE>
SCHEDULE B
DISASTER RECOVERY SERVICES
SOLV(TM) 2000
1. To safeguard its client and its Data Center, Nova provides the services
listed below to all of its clients at no extra charge.
a. Tape Backup and Off-Site Storage:
Nova performs full-pack backups of all client data, programs,
and user libraries on a weekly basis. These backups are
performed each weekend after processing and are moved to
off-site storage on the next business day. The off-site storage
rotation is three generations with the oldest copy returned to
Nova.
b. Data Center Support System:
Nova maintains support systems for the Data Center to reduce the
threat of the loss of normal business functions. These support
systems include:
- Smoke and heat detectors throughout the building
- Emergency power system (Uninterruptible Power
- Supply) Secured limited access program in effect
2. Nova's responsibility for disaster recovery is limited to that specified
in Section 1. However, should Nova's data processing facility be
substantially damaged or destroyed to the extent that Nova is no longer
capable of providing data processing services to Client under this
Agreement, Nova will assist client in locating and obtaining an
alternate processing site to enable Client to resume processing. Client
shall not incur any cost of recovery in the event Nova's security and/or
operation center is destroyed, In the event of a disaster, Nova agrees
to provide limited access to a backup system within 24 hours .
Processing will be re-established according to disaster plan within the
24 hour time span.
<PAGE>
SCHEDULE C
PROCESSING SERVICES AND PRICING
SOLV(TM)
1. Back Office Processing (monthly fee):
Nova offers complete back office processing in the Atlanta Data Center.
The fees for the first year's service described in Schedule E is as
follows:
Month 1-3 $_____
Month 4-6 $_____
Month 7-9 $_____
Month 10-12 $_____
There after (Month 13 through the remaining term of the Agreement) the
fees will be $_____ per month or Schedule E whichever is greater.
In addition to the monthly fees, a $_____ per day transmission fee will
be charged for transmitting the transaction file to your processor.
<PAGE>
SCHEDULE D
IMPLEMENTATION FEE
The implementation fees associated with the start up of the Bank will be $_____.
Implementation fees shall be billed upon execution of this Agreement and will be
payable upon the approval of transfer and establishment of the charter for
Atlanta Internet Bank. In the event Atlanta Internet Bank is unsuccessful in
establishing an independent entity in Georgia, as contemplated, Nova will bill
Atlanta Internet Bank fees equal of $_____ per day for efforts expended in
setting up for implementation of the Bank's outsourced item processing. Client
agrees to reimburse Nova for reasonable out-of-pocket expenses.
ORGANIZATIONAL EFFICIENCY SERVICES
The Organizational Efficiency Services will be provided for $_____ and shall be
billed and payable upon execution of this Agreement. The services are generally
described as follows:
1) Establishing the General Ledger Chart of Accounts, with
consideration given and procedures established for Expenses,
Accruals, Regulatory Reporting, Fed Reporting, Reserve
Requirements, Investments, Income Tracking and Reporting, as
well as any interface requirements.
2) Establish definition for bank responsibilities, processor
responsibilities, guidelines, settlement issues, wire
procedures, deposit procedures, return item procedures, as well
as to either select or develop an Audit Group.
3) Secure your new Routing and Transit number, ISO number, and
coordinate the FRB District move.
4) Additionally, Nova will assist in any other matter not listed
here that is deemed necessary in providing for a sound
operational environment.
<PAGE>
SCHEDULE E
BACK OFFICE PROCESSING (BOP)
SCHEDULE OF CHARGES
------------------------------------------------------------------------------------------------------------------------------
POD UNIT COST IMAGE PRODUCTS UNIT COST
------------------------------------------------------------------------------------------------------------------------------
POD RECEIVED (pre-encoded) $_____/ITEM POD RECEIVED (pre-encoded) $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
POD RECEIVED (non-encoded) $_____/ITEM POD RECEIVED (non-encoded) $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
CHECK STORAGE $_____/ITEM CHECK STORAGE $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
FILMING $_____/ITEM PLATTER CAPTURE $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
PROOF CORRECTIONS $_____/ITEM PROOF CORRECTIONS $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
STATEMENT PREPARATION UNIT COST IMAGE PRODUCTS UNIT COST
------------------------------------------------------------------------------------------------------------------------------
FINE SORT (Inclearings and POD) _____ FINE SORT (Inclearings and POD) N/A
------------------------------------------ --------------------- --------------------------------- ---------------------------
STATEMENT PREPARATION $_____/STATEMENT STATEMENT PREPARATION
INDIVIDUAL/COMMERCIAL INDIVIDUAL COMMERCIAL $_____/STANDARD 3 PAGE
STATEMENT
SAVINGS/TRUNCATED $_____/STATEMENT $_____ ADDITIONAL PAGES
$_____/TRUNCATED ACCOUNT
STATEMENT
------------------------------------------------------------------------------------------------------------------------------
INSERTS SEE NOTES INSERTS SEE NOTES
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------
RETRIEVAL $_____/ITEM RETRIEVAL $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
RESEARCH $_____/ITEM RESEARCH $_____/ITEM
------------------------------------------------------------------------------------------------------------------------------
COPIES $_____/COPY COPIES $_____/COPY
------------------------------------------------------------------------------------------------------------------------------
RAX $_____/COPY FAX $_____/COPY
------------------------------------------------------------------------------------------------------------------------------
FED RETURNS $_____/ITEM FED RETURNS $_____ COPY
------------------------------------------------------------------------------------------------------------------------------
EXCEPTION ITEM PULL $_____/ITEM EXCEPTION ITEM PULL $_____/ITEM
(NSF, Stop Pays, etc.) (NSF, Stop Pays, etc.)
------------------------------------------------------------------------------------------------------------------------------
POSTAGE POSTAGE
------------------------------------------------------------------------------------------------------------------------------
NOTE. Minimum monthly charge is $_____ plus direct passthroughs.
PROCESSING SCHEDULE:
The daily schedule depends on the following variables:
1. Customer's daily business hours
2. Availability schedules
3. Courier schedules
4. Location of POD encoding
5. Volume
<PAGE>
BACK OFFICE OUTSOURCING
DESCRIPTION OF SERVICES
PROOF & ENCODING
Proof/encode all items
Customer corrections
Teller corrections
ITEM PROCESSING
Balancing
Cash letter preparations sends
Reject/re-entry
Fed Inclearings and related adjustments
EXCEPTION ITEM PROCESSING
Pull exceptions
Implement decisions of bank-mail notices
Stop suspect review
Stop payment verification
Holds, suspects review
Large dollar review
"Special Handling" amounts (i.e., 2 signatures)
CHARGEBACKS FROM FED
ACH/EFT
Bank receives ACH to Fedline at bank; upload file to NOVA
Balance ACH
Reject/re-entry
RESEARCH AND ADJUSTMENTS
DORMANT ACCOUNTS
KITE SUSPECTS
MISCELLANEOUS NOTICES
RECORD STORAGE/RETENTION
IRA OPERATIONS (OTHER RETIREMENT ACCOUNTS)
IOLTA'S
SAFE DEPOSIT BOX PROCESSING/BILLING (not priced at this time)
MAIL OPERATIONS
STATEMENT RENDERING
<PAGE>
SCHEDULE F
In the event that the Client terminates this Agreement, Nova shall be entitled
to retain any conversion fees and charges due or paid for initial conversion.
Further, the following termination charges shall apply:
If termination occurs prior to month 18 of the initial term of the agreement,
but after conversion to the Nova system, then the termination charge will be
____% of the actual first years billing for processing services. If the
termination occurs prior to the 12th month of service, the first year's billing
will be projected using an average of the last 3 months billing times 12.
If termination occurs in month 19 or later of the initial term of the agreement,
the termination charge will be _____% of the immediately preceding 12 month's
billing.