THIS FRANCHISEE SERVICE AGREEMENT (this “Agreement”) is made as of the date of signature below (“Execution Date”), by and among Sound Billing, LLC, a Wisconsin limited liability company doing business as MyFleetCenter (“SB”), having its principal place of business at 7447 University, Suite 201, Middleton, Wisconsin 53562, USA and the entity named in the associated application, having its principal place of business at the Location identified in this application (“FRANCHISEE”).
WHEREAS, SB is engaged in providing billing services to various automobile aftermarket service centers throughout the United States and North America and has developed an expertise in billing, on behalf of such automobile aftermarket service centers, to various automobile fleet owners; and
WHEREAS, Midas International Corporation, (MIDAS) licenses the right to use its trademarks, products and services to independent Midas franchisees; and
WHEREAS, FRANCHISEE owns and operates automobile aftermarket facilities as identified on Exhibit A attached hereto (each a Franchisee “Location” and, collectively, “Locations”), that provide services to customers of the Franchisee (hereinafter referred to as Account(s)); and
WHEREAS, FRANCHISEE is desirous of participating in the Fleet Billing Program of SB to secure fleet billing services to be provided by SB at its Locations for its Accounts; and
WHEREAS, SB is willing to provide such services under the Fleet Program for Locations and Accounts in accordance with the terms identified herein; and
WHEREAS, MIDAS has given its approval to permit the FRANCHISEE to participate in the Fleet Billing Program of SB in accordance with the terms identified herein.
NOW, THEREFORE, in consideration of the premises and mutual promises contained herein, the parties hereto agree as follows:
1.
Services. SB agrees to provide billing and other related services, as described herein (“Services”).
2.
Data Established and Transfer.
- (a) Immediately upon the execution of this Agreement the parties hereto shall; establish a link data port or bridge or a similar means of electronically transmitting Account invoice data (“Data Transfer”) between the Location’s current point of sales system or fleet invoice processing platform and SB’s fleet billing platform so as to allow information regarding fleet services that are provided at the Location(s) to Accounts of the FRANCHISEE to be shared with SB so that SB can perform the Billing Services contracted for herein, and
- (b) FRANCHISEE shall provide to SB all necessary account and transfer information so as to allow SB to receive electronic fund transfers as called for in Paragraph 7 hereof.
3.
Enrollment of Accounts.
- (a) SB shall perform credit and background checks for any Accounts (“Applicants”) who complete and submit an application on the current application form (“Application”) to secure fleet billing services from a FRANCHISEE (as defined below). SB will review all Account applications and references and establish conditional approval within five (5) business days of receipt of the Account’s application from the FRANCHISEE. A good credit rating (“C” or above) or two positive returned references are required to open an Account (see paragraph 6(a) and (b) for credit and collection terms.). FRANCHISEE acknowledges that SB will open an Applicant’s Account in accordance with the Credit and Collection policy (each, an “Account” and collectively, “Accounts”) for the Accounts of the FRANCHISEE. In the event an application fails to meet the credit and collection criteria, SB shall notify FRANCHISEE in writing and shall submit the application and references to FRANCHISEE for FRANCHISEE’s further review. FRANCHISEE reserves the right to instruct SB to provide services to an Account of the franchisee that does not meet the Credit and Collection policy criteria. FRANCHISEE also reserves the right to deny services to an Account of a customer of the FRANCHISEE notwithstanding the Account meeting the qualifications set forth in the credit and collection terms. SB shall not accept instructions to allow or deny services to an Account of the FRANCHISEE unless said instructions are in writing (which shall include email). It is understood that SB does not represent or warrant the collectability of any of the identified Accounts.
- (b) SB will, within five (5) business days of an Applicant meeting the Credit and Collection policy, provide to the Account of the FRANCHISEE proper set up into MyFleetCenter (as defined below) and any other SB billing platform necessary for Account billing.
4.
MyFleetCenter. SB shall make available to FRANCHISEE and its Accounts a secure, multi-functional, web-based billing and account maintenance management system (“MyFleetCenter”) specific to the Account of the FRANCHISEE. FRANCHISEE will make available to SB Account invoice data and SB will, within twenty-four (24) hours of receipt of such data, update MyFleetCenter.
5.
Account Billing. No later than the fifth (5th) day of each month, on the condition that SB has received all necessary information and data from FRANCHISEE, SB will deliver statements to each Account of the FRANCHISEE identifying the work performed by each Location for the benefit of said Account of the FRANCHISEE during the immediately preceding calendar month. Throughout the Term of this relationship SB will send monthly statements to all Accounts with a balance due, whether they are current or past due.
6.
Account Collections. SB will conduct its collections activities in accordance with its normal operating procedures which include, without limitation, correspondence with the Accounts, whether they are current or past due to include those activities described in Exhibit B. At all times during this relationship FRANCHISEE will have access to complete information regarding the status of Accounts through MyFleetCenter websites that are maintained on a 24/7 basis by SB.
- (a) Credit Policy: SB will review applications and references and establish Account approval within 5 business days, where possible. A good credit rating or two good returned references are required to open an Account. Further review of Account history may alter the status of the Account.
- (b) Collection Policy: SB will use its best efforts to collect all invoices on a timely basis. Delinquent Accounts will be pursued by MyFleetCenter and third party collection agencies.
- (c) Late Fees: Fees may be applied to Accounts that are past due. Late fees will be collected by SB. In order to ensure compliance with credit policies, regular Account reviews will be conducted. Any delinquent Accounts will be set to cash per FRANCHISEE request.
- (d) Collection Agency Referral Criteria: A collection agency will be referred upon for Accounts that have either an undeliverable or bad address or for Accounts that do not comply or respond to collection efforts. Any fees from collection agency will be deducted from any payment collected and sent to Franchisee.
- (e) Collection Agency Returns & Uncollectable Accounts: The collection agency will work the Accounts for a maximum of six months. If they are unable to secure payment of the balance in full, the Account will be deemed uncollectable and will remain permanently closed.
7.
Remittance to FRANCHISEE. SB will remit to FRANCHISEE, on a weekly basis, funds that it receives from Accounts of the FRANCHISEE less any Service Fees as more fully defined in paragraph 8 below. Funds received by SB on Saturday through and including Friday, will be paid on the following Friday. In case Friday is a banking or national holiday, payment will be made to FRANCHISEE the following Monday. Such remittance shall be in the form of an electronic funds transfer to FRANCHISEE according to FRANCHISEE’s EFT/ACH transfer instructions. In addition to the funds remitted to FRANCHISEE, SB will provide a full accounting identifying the source of the funds and expenses charged against the funds.
8.
Service Fees. FRANCHISEE acknowledges that SB will charge a Service Fee for each original invoice submitted to an Account by SB on behalf of FRANCHISEE. The Service Fee assessed as of the date of this Agreement shall be applied by SB only to the first original invoice sent to an Account. The Service Fee assessed shall be 1.25% of the gross invoice. SB agrees that the Service Fee shall not apply to invoices re-sent to Accounts as part of SB’s collection or account management efforts. SB will not make any adjustment, give any Account a discount, credit or otherwise permit an expense to be subtracted from the gross sales amount owed to FRANCHISEE by an Account, unless the same is approved by FRANCHISEE. Such approval by FRANCHISEE must be in writing (which shall include email).
9.
Personnel Contacts. The parties will, at the inception of this relationship, identify a contact individual at each of their respective offices who will interface with the other party’s personnel on all issues of technology, communication and data transfer.
10.
Support. SB shall provide FRANCHISEE, its Locations and Accounts, with access to a SB representative for resolution of problems relating to MyFleetCenter, the Application Process, or Data Transfer. Calls will be answered during the hours of 8am to 6pm Central Time (or CDT, when applicable), Monday through Friday. SB shall attempt to resolve such problems, which may include, among other things, bug fixes for MyFleetCenter or Data Transfer. Problem resolution shall be addressed by SB with the same priority as all other products and services provided by SB. FRANCHISEE agrees to use reasonable efforts to resolve questions or problems prior to calling SB. SB will provide FRANCHISEE and its Locations and Accounts with a toll free customer service phone number to request support.
11.
Welcome Letters. SB agrees to send MIDAS-branded welcome letters, at SB’s expense, to all Accounts of the FRANCHISEE upon enrollment. MIDAS and FRANCHISEE must approve, in writing, the welcome letter design and verbiage prior to distribution.
12.
Obligations of FRANCHISEE. Throughout the Term, FRANCHISEE shall:
- (a) Provide completed Applications of each Account of the FRANCHISEE to SB.
- (b) Make available all Account invoice data, including without limitation, the last eight (8) digits of all vehicle identification numbers (VIN) to SB via the Data Transfer.
- (c) Attempt to resolve any disputes that may arise with an Account to include any write-offs, payment plans and credit memos.
- (d) Provide to SB any and all information pertaining to the Account necessary for SB to submit periodic statements to such Account(s) and to allow SB to maintain its MyFleetCenter program for each Account.
13.
Representations and Warranties of Sound Billing. SB and MIDAS make no representations or warranties as to the ability of SB to collect amounts that may be due and owing to, or for the benefit of, FRANCHISEE from its Account (s). Any decision concerning whether to pursue legal action in the event of non-payment by an Account shall be made solely by FRANCHISEE. In no circumstance shall any party hold MIDAS responsible for the payment obligation of any Account.
14.
Term. The Term of this Agreement (the “Term”) shall commence on the Effective Date and continue for one year at which time the agreement will automatically renew unless written notice is received by either party sixty (60) days before an anniversary date. Terms and pricing may change with a written notice at least sixty (60) days before the first anniversary date and any time thereafter with sixty (60) days written notice. Notwithstanding the above identification of the Term of this Agreement the parties understand that this Agreement is interdependent with a Strategic Alliance Agreement existing between SB and MIDAS. In the event that the Strategic Alliance Agreement is terminated by either SB or MIDAS SB or the FRANCHISEE may terminate this Agreement upon providing the other party with a thirty 30-day written notice of such termination. In the event that the FRANCHISEE’s Franchise Agreement with MIDAS is terminated either party to this Agreement may provide the other party with a thirty (30) day written notice of the termination of this Agreement.
15.
Confidentiality and Ownership. Each party to this Agreement shall maintain strict confidentiality with each other and with MIDAS with respect to all information that may be received by a party hereto from one another or from MIDAS. All such information shall be identified as Confidential Information and shall be disclosed only to signatories hereto or to MIDAS (“Confidential Information”). The parties agree not to disclose any Confidential Information to any third party without the express written consent of the disclosing party and MIDAS. Further, the parties shall use the Confidential Information only for the purpose of performing their duties and obligations to each other under this Agreement and not for its own purposes or for any other purpose. Notwithstanding any of the provisions herein to the contrary, Confidential Information shall not include information or material which (i) is known to the receiving party prior to its disclosure by the disclosing party; (ii) is public knowledge at the time of disclosure by the disclosing party to the receiving party, or which at any time thereafter becomes public knowledge through no fault of the receiving party; (iii) is received by the receiving party from a third party under no obligation of confidence, express or implied, to the disclosing, party; or (iv) is required by a court of competent jurisdiction to be disclosed by the receiving party or is, in the opinion of counsel to the receiving party, required, by law to be disclosed by the receiving party. The provisions of this confidentiality and restricted use provision shall remain in effect for the Term of this Agreement and for a period of two (2) years thereafter. SB acknowledges and agrees that any information regarding Applicants and Accounts is FRANCHISEE’s Confidential Information, owned solely by FRANCHISEE, and that SB will treat said Confidential Information in accordance herewith. SB agrees to return all of MIDAS’s and FRANCHISEE’s Confidential Information to it upon the expiration or termination of this Agreement.
16.
Applicable Law. This Agreement shall be construed and enforced in accordance with the laws of the state of Wisconsin and venued in the Wisconsin state courts located within Dane County, Wisconsin.
17.
Enforcement Costs. If either party brings any action for injunctive relief or recovery of damages or to enforce any of the terms, covenants or conditions contained herein, the prevailing party shall be entitled to recover from the other party reasonable attorney's fees, in addition to costs and necessary disbursements incurred in such action. Under no circumstances shall either party be liable for indirect, consequential or punitive damages.
18.
Assignment. This Agreement shall be assignable by either party without the prior written consent of the other parties which will not be unreasonably withheld.
19.
Use of the MIDAS Trademark.
- (a) Subject to the terms hereof, MIDAS has granted unto SB a limited license and privilege to utilize trademarks of MIDAS in the United States and North America in connection with the Services referenced in this Agreement, provided, however, that any such use of the MIDAS trademark is approved by MIDAS, in writing (including by email), prior to such use.
- (b) The FRANCHISEE acknowledges that SB’s right to the limited license as it pertains to the business of the FRANCHISEE and SB’s use of the MIDAS name and its trademark for the benefit of the FRANCHISEE shall end upon the earlier of the following occurrences:
- 1)The termination or expiration of this Agreement.
- 2)The termination or expiration of the FRANCHISEE’s franchise agreement with MIDAS as it pertains to that specific FRANCHISEE or Service Center.
- 3)The termination or expiration of the Strategic Alliance Agreement existing between MIDAS and SB.
- (c) FRANCHISEE acknowledges that SB must submit samples of any and all advertising materials bearing the trademarks of MIDAS to MIDAS for approval prior to the use and distribution thereof. It is anticipated that the trademarks to be used by SB will be used in conjunction with the billing service so as to insure that the various accounts receiving billings from SB recognize that the billing received is on behalf of FRANCHISEE and is in conjunction with services rendered by FRANCHISEE to such Account.
- (d) If MIDAS terminates its grant of the above referenced limited license the FRANCHISEE acknowledges that SB must, and will, immediately remove the MIDAS name and trademarks from any and all billing products or services upon a written notice of such termination or expiration.
20.
Obligations upon Termination or Expiration.
- (a) Termination. In addition to the termination provisions stated above, any party may terminate this Agreement without cause by providing sixty (60) days prior written notice of termination to the other parties.
- (b) FRANCHISEE Accounts. During the Term of this Agreement, and after its expiration or termination, SB shall not directly, either on behalf of itself or on behalf of any other persons or entity, attempt to transfer any Account of the FRANCHISEE to SB or any other persons or entity. For purposes of clarification, SB shall not be in breach of this provision in the event a Location or an Account of the FRANCHISEE contacts SB without having been solicited by or on behalf of SB. SB further agrees that all Account information, including, without limitation, invoice data, customer names and applications are and will remain the Confidential Information of FRANCHISEE per the terms described in Paragraph 17 hereof.
- (c) Default and Termination. Should any party to this Agreement reasonably believe that another party has failed to materially perform its obligations hereunder such party may give written notice to the breaching party of the particular action or non-action alleged to constitute a material breach of this Agreement, with a copy to the other party. Should the breaching party fail to rectify the alleged breach within thirty (30) days of receipt of the written notice of breach, then the non-breaching party may, in addition to any other remedies available to it, elect to terminate this Agreement. Such termination will be effective immediately upon receipt of written notice of termination. Upon termination, each party will immediately reconcile its account with the other party, and immediately pay any monies due hereunder.
21.
Indemnification.
- (a) Indemnification by SB. SB shall defend, indemnify, hold harmless and otherwise protect FRANCHISEE from and against all debts, liens, claims, losses, causes of action, suits, damages, liabilities, fines, penalties, costs and expenses, including reasonable attorneys’ fees and costs, arising out of or resulting from (i) any breach by SB of any of its warranties or agreements hereunder or under any other provision of this Agreement; (ii) any third-party demand, action, claim, or suit based upon the infringement of any patent, trademark, copyright, trade secret or other proprietary interest; or (iii) any violation of an applicable federal, state, local or foreign statute, rule, regulation, code, ordinance or industry-recognized and accepted standard on the part of SB or with respect to any of its Services hereunder.
- (b) Indemnification by FRANCHISEE. FRANCHISEE shall defend, indemnify, hold harmless and otherwise protect SB and its, subsidiary and affiliated companies, and its respective shareholders, directors, officers, employees, agents, franchisees, successors and assigns from and against all debts, liens, claims, losses, causes of action, suits, damages, liabilities, fines, penalties, costs and expenses, including reasonable attorneys’ fees and costs, arising out of or resulting from any breach by FRANCHISEE of any of its warranties or agreements hereunder or under any other provision of this Agreement.
22.
Notifications. Unless otherwise stated herein, all notices required under the terms of this Agreement shall be in writing and shall be deemed to have been duly given the same day after being delivered personally, on the third day after being mailed by registered or certified mail, return receipt requested, or the next day after being placed with a nationally known overnight delivery service, to the parties at the addresses indicated below (or at such other address as shall be specified by notice):
If to SB:Sound Billing, LLC
P.O. Box 620796
7447 University, Suite 201
Middleton, WI 53562
(Phone) 608-836-6563
(Fax) 608-836-1739
with a copy to:Attorney Frederick Rikkers
Rikkers Law
419 Venture Court
P.O. Box 930555
Verona, WI 53593
(Phone) 608-848-6350
(Fax) 608-848-6357
23.
Miscellaneous.
- (a) Unless expressed otherwise herein all funds referred to in this Agreement shall be a reference to funds in United States dollars.
- (b) Severability. In the event any provision of this Agreement is held to be invalid or unenforceable for any reason, such invalidity or unenforceability shall not affect the validity and enforceability of any other provision hereof.
- (c) Binding Effect. Each of the undersigned individuals represents and warrants that he or she has been duly authorized to enter into this Agreement on behalf of the party he or she purports to represent. The covenants, conditions and agreements contained in this Agreement shall be binding upon and pass to the benefit of the parties and his or her respective heirs, successors, personal representatives and assigns.
- (d) Entire Agreement. This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and shall supersede all previous proposals, both oral and written, negotiations, representations, commitments, agreements and all other communication between the parties.
- (e) Amendments or Alterations. This Agreement may not be altered or modified except in writing signed by both parties.
- (f) Relation to Parties. The relationship of the parties is that of vendor-vendee and not of principal and agent or joint venture partner. No party may act on behalf of or make commitments on behalf of the other parties.
- (g) Compliance with Laws. Each party agrees to comply with all applicable laws and regulations in the performance of its obligations hereunder. As this applies to SB, it shall ensure compliance with all applicable laws, statutes and regulations, including, without limitation, those related to data privacy, security, retention, personally identifiable information, debt collection and making phone calls to customers.
- (h)Cumulative Remedies. Except as otherwise expressly stated herein, the rights and remedies provided in this Agreement shall not be exclusive and are in addition to other rights and remedies provided by law.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Execution Date first stated above.
I understand that by completing this application and entering my name below, I am agreeing to all of the terms of this Agreement.