Software Development And License Agreement

IFS INTERNATIONAL, INC.


SOFTWARE DEVELOPMENT AND LICENSE AGREEMENT


SOFTWARE DEVELOPMENT AND LICENSE AGREEMENT (this "Agreement") by and between IFS INTERNATIONAL, INC., a New York Corporation having offices at 185 Jordan Road, Troy, New York 12180 ("IFS"), and, Visa International Service Association, a Delaware Corporation having offices at 900 Metro Center Boulevard, Foster City, California 94404 ("Visa" or the "Licensee").


RECITALS


A. Visa is a not-for-profit corporation servicing member banks, and is in the business of providing products and services for its members involving credit cards, debit cards and other electronic funds transfer products.


B. Visa is in the process of developing a product commonly known and described as a stored value card (hereafter "SVC"). Visa's SVC is sometimes hereinafter referred to by its trade name, being "Visa Cash".


C. IFS has experience and capability in the development of application software for routing, monitoring, and intercepting automated teller machine, point-of-sale SVC, and other electronic funds transfer transactions.


D. IFS and Visa have previously entered into a similar software development and license agreement involving an initial pilot or testing program, conducted on a limited scope at Visa's headquarters facility.


E. Visa now desires to expand its Pilot Programs (as defined herein) on a larger scale, such expanded testing to include seven (7) new separate Pilot Programs throughout the world.


F. Licensee desires IFS to develop application software for SVC applications in accordance with certain functional specifications prepared by IFS and approved by Licensee and to install such application software on certain computer equipment to be purchased by Licensee for the purpose of conducting such further "pilot" or testing programs to be operated by Visa.


G. IFS desires to grant to Licensee certain limited use rights and licenses in and to such SVC application software, in accordance with the provisions of this Agreement.


NOW THEREFORE, in consideration of the mutual covenants and promises set forth herein, the parties hereto agree as follows:


ARTICLE 1


DEFINITIONS


As used in this Agreement, the following words and terms shall have the following meanings, unless the context or use indicates another or different meaning or intent.


"Acceptance" means the acceptance of the Software by Licensee in accordance with Section 2.6 of this Agreement.


"Agreement" means this Software Development and Licensing Agreement, including all schedules or exhibits attached hereto, and, as of the date of its acceptance by IFS and Licensee in accordance with Section 2.1(c) hereof, the Functional Specifications, as the same may be amended or supplemented from time to time in accordance with the terms hereof.


"ATMs" means the automatic teller machines with which the Software is intended to interface.


"Designated Site(s)" means up to seven (7) locations to be designated by Visa as Pilot Program processing sites where the Software is to be installed.


"Documentation" shall mean all documentation and supportive literature which explains the use or operation of, or otherwise relates to, the Software, including, without limitation, all proprietary users or operating manuals, brochures, or electronic text.


"Extended Maintenance" means the maintenance and support services provided by IFS for the Software pursuant to Section 5.3 hereof.


"Functional Specifications" means the formal document to be prepared by IFS in accordance with this Agreement and agreed to in writing by IFS and Licensee and which will set forth the parameters, scope, and characteristics of a system of computer hardware and Software to be used in implementing SVC transactions, including ATM functions and various types of SVC related load transactions.


"Hardware" means the UNIX-based computer hardware and associated equipment and operating system Software upon which the Software is intended to be operated and that is to be identified by manufacturer and model number in the Functional Specifications.


"Host Computer" means existing computer system identified in the Functional Specifications with which the Software and Hardware is intended to interface.


"Live Operation" shall mean the operation of the Software on the Hardware without significant error or down time, in processing real financial transactions impacting real accounts, but for Pilot Program purposes only.


"Load Device" means an ATM, POS Hardware or other device which will accept a request to authenticate an SVC card, to load such card with funds and to unload funds from such card.


"Network Computer" means existing computer system which routes and authorizes transactions for financial institutions on a regional or international basis.


"Oracle Software" means the version of the relational database management system Software developed by the Oracle Corporation that is identified in Schedule A attached hereto, as adapted by IFS for use with the Software on the Hardware.


"POS Hardware" means the point-of-sale machines, cash registers, or other hardware with which the Software is intended to interface, including (without limitation) the PIN Pads designated for use with the point-of-sale machines.


"Pilot Program" means SVC processing systems instituted, operated and maintained by Visa or any 3rd party designated by Visa, involving Live Operation, but conducted for the purposes of evaluating the Software and other aspects of the Visa Cash SVC system, for purposes of determining market potential, economic viability, systems analysis, and such other systems analysis and economic factors as Visa may determine appropriate, but not for commercial use.


"Software" shall mean the TechNique Plus II ATM message handler/monitor/router and financial applications interface Software with the SVC module more particularly identified in Schedule A attached hereto and to be developed by IFS in accordance with this Agreement and the Functional Specifications.


"Use" shall mean the reading into and out of memory of the Software and the execution of the Software, in whole or in part, by the Hardware.


ARTICLE 2


DEVELOPMENT, INSTALLATION, AND ACCEPTANCE OF SOFTWARE


2.1 Functional Specifications


(a) IFS has previously prepared Functional Specifications for the initial Pilot Program, which have been agreed upon by Visa. IFS will prepare modifications to such initial Functional Specifications for each of the Designated Sites. It is understood and agreed that the Functional Specifications may vary from site to site, due to differences in the Hardware, differences in communications protocols or other differences in local conditions at different sites. In preparing the Functional Specifications, IFS agrees to interview Licensee's personnel and other necessary personnel and review Licensee's facilities as required. Licensee agrees, for the purpose of facilitating IFS's preparation of the Functional Specifications, to provide IFS information regarding existing computer systems and Operating Software required to complete the Functional Specification, if necessary (including without limitation, existing network and/or Host computers and software), and to cooperate in a timely and diligent manner.


(b) Upon completion of the Functional Specifications for any Designated Site by IFS and delivery to Licensee, Licensee shall have a period of twenty (20) days in which to suggest modifications thereto. Such modifications shall be incorporated into the Functional Specifications unless such modifications cannot be made compatible with the Software or are otherwise impracticable or incompatible with the Hardware or the applications to be performed by the Software.


(c) Once the Functional Specifications for each Designated Site have been completed, a copy thereof shall be signed by a representative of both parties, and such Functional Specifications shall thereupon become an integral part of this Agreement and be incorporated herein by reference, even though not physically attached hereto.


2.2 Development of Software


IFS shall be responsible for developing the Software in accordance with the Functional Specifications for each Pilot Site.


2.3 Installation of Software


(a) Subject to the conditions set forth in this section 2.3, IFS shall be responsible for installation of the Software on the Hardware at the Designated Site(s), such installation to be performed by IFS personnel or designated agents of IFS.


(b) The obligation of IFS to install the Software shall be contingent upon satisfaction of the following conditions by Licensee or by third party vendors to be retained or employed by Licensee -


(i) delivery and installation of the Hardware at the Designated Site(s) in
operational form and in the approved configuration designated in the
Functional Specifications,


(ii) IFS being furnished, free of charge, with dial-up test access to the
Hardware, the Host Computer, the ATMs and/or the POS Hardware and any
other hardware peripherals to be used in connection with the Visa Cash
SVC system, for the period of time required by IFS for installation
and testing,


(iii) IFS being furnished with telephone access to the computer networks
identified in the Functional Specifications for the period of time
required by IFS for testing and certifying the Software for use in
interfacing with such computer networks,


(iv) establishment of such other telephone and communication links as are
designated in the Functional Specifications or otherwise reasonably
required by IFS in order to develop the Software,


(v) delivery and installation, in operation form, of such other equipment,
appropriately configured, as shall be identified either in the
Functional Specifications or otherwise specified by IFS to Licensee in
written specifications at least thirty (30) days prior to the date
such equipment is required, and


(vi) such other conditions as are contained in the Functional
Specifications.


(c) The obligation of IFS to install the Software shall be additionally contingent upon IFS having previously obtained all required export licenses and other applicable governmental approvals for the installation and licensing to Licensee of the Software (and if applicable, the Oracle Software) at any of the Designated Site(s) which are outside of the U.S.A.


(d) If, through no fault of IFS, Licensee is not able to satisfy any of the conditions contained in subsection (b) on a mutually agreeable schedule, any additional charges incurred by IFS by reason of time lost as a result thereof shall be billed to Licensee at IFS's then prevailing standard rates.


(e) Licensee desires to implement its SVC system by delivery and installation of the Software at each of the Designated Sites on or before the installation date to be specified in the Functional Specifications applicable to such Designated Site. IFS will utilize its best efforts to deliver the application by said date. If, through no fault of Licensee, or any other vendor associated with Licensee, IFS is unable to meet the specified completion date, Licensee shall not be obligated to pay any amounts that would otherwise be due under this Agreement until such time as IFS has completed the implementation and the results hereof have been accepted by Licensee.


2.4 Obligations of Licensee


(a) Licensee shall be responsible for ensuring that each of the conditions specified in Section 2.3(b) are satisfied in a timely manner.


(b) For each Pilot Program, Licensee agrees to make available at least one (1) qualified technical person to work with IFS representatives as a primary technical representative in connection with the installation and testing of the Software, and the training of the designated personnel on the Software. Visa shall also make available such other technical personnel as may be needed to ensure such timely installation, testing, and training.


The primary technical representative shall be available at all times to IFS, and shall have authority to answer questions and make final decisions binding Visa with respect to the development, installation, testing and training on the Software. In the event of the illness or other absence of the primary technical representative, Visa shall designate a substitute to act as primary technical representative. It shall be the duty of the primary technical representative to promptly and expeditiously process all requests for information and to promptly and expeditiously make decisions upon request by IFS.


2.5 Acceptance of Software


The Software shall be considered accepted by the Licensee for all purposes under this Agreement upon the earlier to occur of (i) completion of installation of the Software by IFS and acceptance by Visa of the Software as being in substantial conformity with the Functional Specifications after the conclusion of a thirty (30) day operational test period, or (ii) the completion of ten (10) days of Live Operation of the Software.


2.6 Training


(a) IFS shall provide Licensee with basic training on the operation of the Software for such number of employees, for such duration, as are identified in the Functional Specifications, but all such training shall be conducted at IFS' Troy, New York offices unless otherwise expressly agreed in writing by IFS.


(b) Licensee will be solely responsible for properly training its employees on the Hardware's UNIX operating system and on the Oracle Software, such training to be completed prior to IFS commencing training on the Software.


ARTICLE 3


GRANT OF LICENSE


3.1 Software License


(a) (i) Subject to the terms set forth herein, upon acceptance of the Software, IFS grants to Licensee and Licensee accepts from IFS, a non-exclusive, personal, and nontransferable license to use the Software for a term of twenty four (24) months from initial certification, in object code form only, along with the Documentation. This license is granted for the limited and restricted purpose of conducting Pilot Programs concerning the Visa Cash system. IFS further agrees that, in addition to the testing of the Software with sample transactions, Visa shall be entitled to go to Live Operation and process real transactions, but only for purposes of evaluating the Software and other aspects of the Visa Cash system, for purposes of determining market potential, economic viability and such other factors as Visa may determine appropriate.


(ii) Visa can elect to extend the license to use the Software after the inital twenty four (24) months in increments of 12 months subject to the additional payment terms detailed in Schedule A.


(b) With respect to each of the Pilot Programs, the following restrictions shall apply:


(i) up to five (5) member banking organizations shall participate in
such Pilot Program; In the event that subsequent member banking
organizations are added to the Pilot Program then the additional licensing
and maintenance costs detailed in Schedule A shall apply. In the event that
a member banking organisation leaves the Pilot Program prior to a sixth
member banking organisation being added, leaving a net total of 5
organizations, then all that will be payable will be time and materials
costs detailed in Schedule A in implementing the change.


(ii) up to three hundred (300) Load Devices shall be permitted per
Pilot Program; In the event that subsequent member banking organizations
are added to the Pilot Program then an additional sixty (60) Load Devices,
per member banking organisation, shall be permitted.


(iii) In no event is Visa authorized to sublicense the Software to any
of its member banking organizations or to any other third parties for
independent testing by such member organization or for Live Operation
outside of the Pilot Program;


(iv) In no event is Visa authorized to incorporate this Software in
any network systems Visa may set up for the actual commercial use of the
Software by Visa, by its member banking organizations or other third
parties.


(c) Not withstanding the foregoing, it is understood and agreed that Visa may charge and collect funds or remuneration from its member banking organizations and other third parties in connection with their use of the Software as participants in the Pilot Programs.


IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT THIS LICENSE IS A LIMITED USE LICENSE FOR PILOT PROGRAM PURPOSES ONLY. Visa shall have the right to obtain additional licenses pursuant to the fee in Exhibit A for the Software and Documentation for use by Visa's third party processing contractors for use in supporting Visa Cash card Pilot Program activities in locations where Visa does not maintain a processing center.


3.2 Designated Sites


(a) The Software shall initially be used only at the Designated Site(s). Visa shall designate sites where the Software is to be installed upon Hardware supplied by Visa. Visa may designate up to seven (7) such sites. In the event that a Visa member or members banking organization which has been designated for a Pilot Program requires software features whose functionality, services or other requirements are substantially varied from those set forth in this Agreement and in the Functional Specification provided under this Agreement, then Visa and IFS shall agree upon specific and separate terms for such member or members. Such terms shall be incorporated into an addendum to this Agreement, which addendum shall be signed or initialed by both IFS and Visa. Once a site has been identified and designated, the parties shall note the location and other factors applicable to such site on Schedule B of this Agreement. It is anticipated that Schedule B will be amended during the course of this Agreement as Designated Sites are identified and designated by Visa. However, the failure to update Schedule B shall not have any effect upon the construction or enforcement of this Agreement. These Designated Sites may include Visa-owned processing facilities around the world, the processing sites of Visa's designated processing contractors, and the processing sites of members of Visa engaged in the Visa Cash Pilot Programs.


(b) Licensee may transfer use of the Software from a current Designated Site to another location provided (i) Licensee has given prior written notice to IFS identifying the location of the new proposed Designated Site, and (ii) if required, IFS has obtained the consent of the export department of the United States Department of Commerce


("USDOC") for use of the Software at the proposed new Designated Site. Upon receipt of such written notice from Licensee specifying the proposed new Designated Site, IFS agrees to make the proper request to USDOC for such consent. Upon any change in a Designated Site in accordance with this Section 3.2(b), Licensee shall have the right to operate the Software concurrently at both the existing Designated Site and the new Designated Site during a conversion period not to exceed thirty (30) days, but in no event shall use of the Software at the new Designated Site begin prior to IFS having received the consent of USDOC, if such consent is required. After the completion of such conversion period, the new location at which the Software to be used shall for all purposes under this Agreement be co ...