Scratch Financial Payment Services Agreement

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Last updated: March 14, 2025

This Scratch Payment Services Agreement for U.S. Providers (this "Agreement") is a legal and binding agreement between Scratch Financial, Inc. ("Scratch," "we," "our," or "us"), and you, as a customer of Scratch's payment processing services ("Provider," "you," or "your"). Scratch utilizes its payment processing platform to allow you to accept payments from your customers ("Client") for the purchase of goods and/or services provided by you (the "Payment Services"). Scratch and Provider may sometimes be referred to herein individually as “Party” or collectively as “Parties.”

By using the Payment Services, you agree to be bound by the terms of this Agreement and any other terms, policies and guidelines applicable to the Payment Services as presented to you. We utilize third-party providers to provide certain aspects of the Payment Services (“Agent”), and you may be required to agree to those Agents’ terms of service, as further described in this Agreement. By entering into this Agreement, you are also entering into, and agreeing to be bound by, our Program Agreement for US Providers, which is incorporated by reference herein. Information you provide to Scratch is governed by our Privacy Policy. To learn more about our privacy practices, please see our Privacy Policy for Providers.

1. GENERAL PROVIDER REQUIREMENTS

1.1. Scratch Account. 1.1. Scratch Account. To access and use the Payment Services, you must open and maintain an account with Scratch (“Scratch Account”). You can view transactions and manage other aspects of the Payment Services through your Scratch Account. You must comply with all Scratch Account licenses and operating requirements when accessing and using your Scratch Account. You are solely responsible for the security and confidentiality of your login credentials to the Scratch Account to ensure they are not compromised, and you are liable for all access and use of your Scratch Account, including use of the Payment Services. Except as required by law, you are solely responsible for reviewing and retaining records of all transactions and other data associated with your Scratch Account and your use of the Payment Services. If you believe that there is an error or unauthorized activity on your Scratch Account or in connection with your use of the Payment Services, you must contact us immediately. Scratch is not responsible or liable if through your actions (or inactions) your Scratch Account is compromised and you sustain any harm (including financial).

1.2. Linked Bank Account. In order to receive Settlement (defined in Section 2.1) of Client payments, you must link a verified bank account to your Scratch Account ("Linked Bank Account"). You authorize Scratch to (a) initiate credit entries (including Settlements) and to initiate, when necessary, debit entries and adjustments for erroneous credit entries, to the Linked Bank Account, and (b) initiate debit entries and to initiate, when necessary, credit entries and adjustments for erroneous debit entries, to the Linked Bank Account. Provider shall not dispute credits and debits with its bank for transfers authorized under this Agreement. Scratch shall not be responsible for any debit entries or adjustments made through the Linked Bank Account due to Provider’s Scratch Account becoming compromised due to Provider’s inaction or failure to ensure protection of log in credentials.

1.3. Agents. The Payment Services, in part, rely on our agent, Stripe, and are subject to the Stripe Connected Account Agreement, which includes the Stripe Terms of Service (collectively, the “Stripe Services Agreement”). By accepting payments through the Payment Services, you agree to be bound by the Stripe Services Agreement, as the same may be modified by Stripe from time to time. As a condition of the Payment Services, you agree to provide Scratch accurate and complete information about you and your business, and authorize Scratch to share that and other information related to your use of the Payment Services with Stripe. Payment Services are governed by the payment network applicable to the transaction, including American Express, Discover, MasterCard, Visa and NACHA (“Payment Networks”), under their respective rules, regulations, bylaws and other requirements (“Payment Network Rules”). Your obligations under this Agreement neither replace nor supersede any obligation you have under the Stripe Services Agreement or other Agent’s terms of service.

Scratch is not a bank and does not offer banking services. Scratch does not hold or own settlement funds; transmit, receive, take possession of or hold settlement funds for transmission; nor does it advertise, solicit or hold itself out as receiving money for transmission.

1.4. Provider Fees.
You agree to pay all applicable charges and fees ("Provider Fees") for use of the Payment Services, as set below in the Pricing Schedule. Except as otherwise stated, Provider Fees (as set forth in the Pricing Schedule) are calculated at the time a transaction is processed and deducted from your Settlement. You are encouraged to thoroughly read and become familiar with the Pricing Schedule. Scratch may change the Provider Fees set forth in the Pricing Schedule at any time by notifying you prior to such change. Unless otherwise agreed in a legally binding written agreement, you shall neither impose nor otherwise require Client to pay for any part of any Provider Fee or other charge assessed by Scratch, whether through surcharge, additional fee or increase in the price of goods or services. You agree and acknowledge that Scratch may charge its own fees directly to the Clients for its services.

1.5. Identity Verification. At the time you sign up for the Payment Services, and upon Scratch’s request, you agree to provide Scratch and its Agents with all information, including valid and current license(s) issued to provide services and goods by Provider, Employer Identification Number (EIN), W-9s, owner information, beneficial owner information, financial statements (collectively, “Provider Information”), reasonably necessary for Scratch or an Agent to verify your information, including your identity, licensing status, financial standing and other requirements for your use of the Payment Services. You further authorize Scratch and Agent to request information about you from third parties. Scratch and its Agents may periodically obtain additional reports to determine whether you continue to meet the requirements for a Scratch Account and use of the Payment Services. Scratch will treat Provider Information as Provider’s Confidential Information in accordance with this Agreement; provided, however, that you authorize Scratch to share information about you, including your application (including whether you are approved or declined), Scratch Account, transactions made via the Payment Services, and information from third parties, with our Agent, and as otherwise specified in our Privacy Policy for Providers. You further authorize Agent to share information with us about you and your transactions with such Agents, in order for us to provide the Payment Services, service your Scratch Account, and market related products and services. If Scratch is unable to verify your identity or if you make any misrepresentations about your identity (including providing falsified/counterfeit documents), Scratch has the discretion to immediately terminate your account without further notice. Scratch reserves the right to modify, change, or add new requirements in order to verify your identity at any time.

1.6. Requests for Additional Information and Inspection. Scratch and our Agents may request additional information from you at any time to ensure you remain eligible to receive its Payment Services . For example, Scratch may ask you to present invoices from your suppliers, a government issued identification such as a passport or driver's license, a business license, veterinary or medical license, or other information. Scratch may also ask for permission to inspect your business location. If you refuse any of these requests, your access to the Payment Services may be suspended or terminated.

1.7. Changes to Payment Services. Scratch may make changes to Scratch Accounts and the Payment Services, including any feature, functionality or payment method. We will provide prior notice of such changes where reasonably possible, but may make changes without notice in some cases, including emergencies and to comply with law, Payment Network Rules and government authorities.

2. SETTLEMENT

2.1. Settlement. Client payments will be settled to your Linked Bank Account, less any applicable Provider Fees (defined in Section 1.4), Chargebacks (defined in Section 2.2), and any other amounts that we are authorized to withhold under this Agreement ("Settlement"). The timing and other conditions of Settlement are subject to the Agent's terms of service, if any, and the Payment Network Rules applicable to the transaction.

2.2. Chargebacks. (a) In the event a Client contests a transaction, whether as an unauthorized charge, due to a dispute with you regarding provision of any good or service (including the delivery or non-delivery, and performance or non-performance, of goods and services, or where the Provider is investigated by a regulatory or legal agency for goods and services delivered or not delivered), or for any other reason, the amount of the transaction may be reversed or charged back to your Scratch Account (a "Chargeback"). For any transaction that results in a Chargeback, we or our Agent may withhold the Chargeback amount from Settlement, as well as any associated Provider Fees, fines, and penalties assessed by a Payment Network or Agent. Further, if we reasonably believe that a transaction is likely to result in a Chargeback, we or our Agent may withhold the amount of the potential Chargeback from Settlement until we or the Agent has determined that a Chargeback will not occur for that transaction.

(b) You are solely responsible for Chargebacks that arise from use of the Payment Services, including any obligation to dispute the Chargeback under an Agent's terms of service (including the Stripe Services Agreement). Without limiting the foregoing, we will provide reasonable assistance to you in contesting a Chargeback, provided that you cooperate in investigating the Chargeback and provide us sufficient evidence (in our sole, commercially reasonable, determination) that adequately refutes the Chargeback, within five days of request. Such evidence may include records of the goods and services provided to Client; receipts indicating Client's authorization to purchase the goods and services; and/or records of successful delivery or performance of the goods and services. Failing to cooperate or provide information in a timely manner may result in the Chargeback being resolved against you.

(c) You agree that we may share information with a Client about your transactions, including a Chargeback, the issuer of the Client's payment method and the relevant Agent, in order to investigate and mediate a Chargeback. If the Chargeback is resolved in your favor, the corresponding funds will be released to you with the next Settlement. If a Chargeback dispute is not resolved in your favor or you choose not to contest the Chargeback, we may retain or recover the Chargeback amount and any associated Provider Fees.

(d) In the event that you (in an individual or business capacity) are subject to a regulatory or legal investigation (including pending criminal charges), Scratch shall issue a Chargeback of the subject transaction. Such Chargeback shall not be taken as an admission of wrongdoing by Scratch or any other party

(e) If we believe you might incur, or you are incurring, an excessive amount of Chargebacks, we may establish additional conditions governing your use of the Payment Services, including (i) revising or establishing new Fees, (ii) requiring you to create a Reserve Account (defined in Section 5), (iii) delaying Settlement, or (iv) terminating or suspending your access to the Payment Services.

(f) If we are unable to recover funds related to a Chargeback for which you are liable, you shall pay us the full amount of the Chargeback immediately upon demand. You shall pay all costs and expenses, including attorneys' fees and other expenses, incurred by us for the collection of all amounts unpaid by you.

2.3. Refunds. You agree to (a) maintain fair and legally compliant refund, return and/or exchange policies, (b) post such policies in a clear and conspicuous manner at the point-of-sale or other location that is clear and readily noticeable before Client completes a purchase, and (c) comply with such policies with respect to any purchase that is paid for using the Payment Services.

If Client is eligible for a refund (including as a result of a reduction in the purchase price) in connection with a purchase paid for using the Payment Services, you agree to process the refund (including returns and adjustments) through your Scratch Account. You may not offer cash nor any other form of refund except as specifically permitted by us or the Payment Network Rules.

The amount of the refund must include associated taxes required to be refunded and shall not exceed the amount shown as the total on the original sales receipt. If your refund policy prohibits returns or is unsatisfactory to the Client, be aware that you may still receive a Chargeback relating to the transaction.

If the funds available in your Scratch Account are insufficient to cover a refund, we may exercise our rights set forth in Section 6, including withdrawing the refund amount from your Linked Bank Account or any Reserve Account, or withholding the refund amount from your next Settlement

3. COMPLIANCE

3.1. Payment Network Rules. You acknowledge, agree, and understand that your transactions are governed by applicable Payment Network Rules. You shall comply with the Payment Network Rules, including requirements for the use of Payment Network Marks, acceptance of payment methods, and provision of receipts. Furthermore, the Payment Networks can and do amend the Payment Network Rules and that Scratch and our Agents may be, likewise, required to change the terms of this Agreement or the Agent's terms of service.

3.2. Payment Network Logos and Marks. Your use of Payment Network logos and marks ("Payment Network Marks") is governed by the Payment Network Rules. The Payment Networks are the sole and exclusive owners of their respective Payment Network Marks. You shall not contest the ownership of the Payment Network Marks, and any Payment Network may prohibit you from using its Payment Network Marks for any reason and at any time. Scratch may require you to make modifications to your website and other advertising and signage in order to comply with Payment Network Rules.

3.3. PCI Compliance. The Payment Services are intended to allow you to process payments without the need for collecting and storing sensitive payment method information. Nevertheless, if you store, process or transmit a Client's payment method information, you shall comply with all applicable payment method security requirements, including the Payment Card Industry Data Security Standards (PCI-DSS) and all other security requirements under the Payment Network Rules.

3.4. Customer Service. You are solely responsible for all customer service and issues relating to your goods and services, including (a) pricing, (b) order fulfillment, (c) cancellations and no shows by you or a Client, (d) returns, refunds, adjustments, and rebates, (e) functionality and warranty, (f) technical support, (g) quality or performance of the goods or services delivered, and (h) feedback concerning experiences with your personnel, policies and processes.

3.5. Taxes. You are solely responsible for determining all taxes assessed, incurred, and required to be collected, paid, or withheld for any reason for your use of the Payment Services ("Taxes"). You are solely responsible for collecting, withholding, reporting, and remitting correct Taxes to the appropriate tax authority (local, state, federal). Scratch is not obligated to, nor shall we determine whether Taxes apply, or calculate, collect, report, or remit Taxes to any tax authority arising from any transaction. Scratch specifically disclaims all liability for your failure to collect, assess or remit Taxes as required by the appropriate tax authority. To the extent required by law, Scratch or Agent will report information about you and your use of the Payment Services to the IRS or other taxing authority.

4. PROHIBITED, RESTRICTED USE

4.1. Prohibited Use. You may only use the Payment Services for the sale of goods and services to Clients in your normal course of business, as disclosed to and approved by Scratch.

Without limiting the foregoing, you may not use the Payment Services for any of the following: (a) illegal goods and services, (b) paraphernalia that may be used for illegal activity, (c) buyers or membership clubs, including dues associated with such clubs, (d) credit counseling and credit repair agencies, (e) credit protection and identity theft protection services, (f) direct marketing and subscription offers and services, (g) infomercial sales, (h) internet/mail order/telephone order pharmacies and pharmacy referral services (where fulfillment of medication is performed with internet or telephone consultation, absent a physical visit, including re-importation of pharmaceuticals from foreign countries), (i) multi-level marketing businesses, (j) inbound and outbound telemarketers, (k) prepaid phone cards and phone services, (l) rebate based businesses, (m) up-sell merchants, (n) bill payment services, (o) betting, including lottery tickets, sports related gambling, casino gaming chips, off-track betting, and wagers at races, (p) manual and automated cash disbursements, (q) prepaid cards, checks, insurance and other financial merchandise and services, (r) sales of money-orders and foreign currency, (s) high-risk products and services, including telemarketing sales, (t) automated fuel dispensers, (u) adult entertainment oriented products and services (via any medium, including internet, telephone, and printed material), (v) sales of (i) firearms, firearm parts and hardware, and ammunition; and (ii) weapons and other devices designed to cause physical injury, (w) internet/mail order/telephone order of age restricted products (e.g., tobacco), (x) collection of pre-existing debt, (y) hateful and harmful products, and (z) escort services.

4.2. Suspected Fraud, Illegal Transactions, Harm. We and our Agents may refuse to process a transaction or withhold Settlement, if we or the Agent believe that the transaction is in violation of this Agreement, applicable law, any other agreement with Scratch, or that it exposes you, Clients, other Scratch Providers, our Agents or Scratch to harm (including fraud and other criminal acts). If we suspect that your Scratch Account or the Payment Services have been used for an unauthorized, illegal, or criminal purpose, you agree, acknowledge, understand, and authorize us to share information about you, your Scratch Account, and any of your transactions with law enforcement and, as deemed necessary by Scratch, our Agents and their financial institution partners. Additionally, we may withhold Settlement or your access to your Scratch Account, as necessary to comply with applicable law, Payment Network Rule or court order, or if requested by any governmental entity, Agent or Payment Network.

4.3. Other Restrictions. You agree not to (a) act as a payment facilitator or otherwise resell the Payment Services to any third party, (b) use the Payment Services to handle, process or transmit funds for any third party, and (c) use the Payment Services to process cash advances.

5. RESERVE ACCOUNT

5.1. In our sole discretion, we may require you to maintain a separate reserve account (a "Reserve Account"), in an amount reasonably determined by us to cover potential losses to Scratch arising from your failure or potential failure to perform your obligations, including Provider Fees, Chargebacks, refunds, levies, liens, and garnishments. The Reserve Account amount may be raised, reduced or removed at any time by Scratch in its sole discretion.

5.2. You shall maintain the Reserve Account at the required amount at all times. If any amount is debited from the Reserve Account, you agree to replenish the Reserve Account no later than three business days following such debit. If you fail to maintain sufficient funds in the Reserve Account, you acknowledge, agree, understand and authorize us to fund the Reserve Account by withholding the appropriate amount from your Settlement or debiting your Linked Bank Account.

6. WITHHOLDING, SETOFF AND SECURITY INTEREST

6.1.. You authorize us to debit, charge, setoff against or otherwise recover funds you owe us and belong to us from any Settlement, your Linked Bank Account or any Reserve Account. You further authorize us to debit or credit your Scratch Account, Linked Bank Account or Reserve Account to correct processing errors. If the error caused you to receive less funds than owed, you will be credited for the difference in the next Settlement. If the error caused more funds to be settled than what was owed, we may recover the excess funds at any time. You have 30 days from and including the transaction date to notify us if you submit a transaction in error, including the incorrect amount. Your failure to do so shall be deemed a waiver of any claim you have to such amount(s).

6.2. You grant us a security interest in and lien on any and all funds held in your Scratch Account, Linked Bank Account (solely with respect to Settlement funds) and Reserve Account, and authorize us to make withdrawals or debits from said accounts without prior notice, in order to collect amounts that you owe us, an Agent, a Payment Network, government authority or other third party under this Agreement. You shall execute all additional documentation required to perfect our security interest in such accounts. This security interest survives for as long as you have outstanding obligations to us under this Agreement.

6.3. Your failure to fully pay amounts that you owe us on demand is a breach of this Agreement. Per this section and section 16.5, you are liable for costs associated with collection on top of amounts owed, including attorneys' fees and expenses, collection agency fees, and any applicable interest.

7. INDEMNITY

In addition to indemnity obligations under other Scratch agreements, you shall indemnify, defend, and hold us and our Agents (and our and their respective affiliates, officers, directors, employees, and agents) harmless from losses, liabilities, and damages of any kind (including without limitation costs, expenses and reasonable attorneys' fees incurred by any indemnified party) arising out of any third-party (including Client) claim, complaint, or Chargeback relating to or arising from (a) your breach of this Agreement or any agreement with Agent (including breach of applicable law and any Payment Network Rules); (b) your use of the Payment Services and any transaction submitted by you through the Payment Services, including the accuracy of any price, content or product, service, or transaction information that you provide; or (c) claim or dispute (including but not limited to regulatory or legal claims or charges) arising out of the goods and services offered, performed, or sold by you.

8. DISCLAIMER OF WARRANTIES

EXCEPT AS EXPRESSLY PROVIDED HEREIN, SCRATCH MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND, NATURE OR DESCRIPTION, WHETHER STATUTORY, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF NON-INFRINGEMENT, ERROR-FREE OPERATION, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

9. LIMITATION OF LIABILITY

9.1. Except with respect to your indemnification and payment obligations set forth in this Agreement, in no event shall either party be liable to the other for indirect, special, incidental, consequential, punitive or exemplary damages (including lost profits or revenue), arising out of, in connection with, or in any way relating to, this Agreement or a party's acts or omissions under this Agreement, whether in contract, tort (negligence or strict liability), or other legal or equitable theory and regardless if such party knew or should have known of the possibility of such damages.

9.2. Scratch's aggregate liability for any direct damages to you under this Agreement shall not exceed the total amount of Provider Fees paid by Provider to Scratch in the immediately preceding 12 months from the date a Provider claim against Scratch first arises under this Agreement.

10. REPRESENTATIONS, WARRANTIES, AND COVENANTS.

10.1. With each transaction you process through the Payment Services, you represent, warrant and covenant that: (a) the transaction represents a bona fide sale; (b) the transaction accurately describes pricing, goods and services provided; (c) you shall fulfill all of your obligations to the Client and resolve any dispute or complaint directly with the Client; (d) you and the transaction comply with all applicable federal, state, and local laws, rules and regulations; (e) except in the ordinary course of business, you shall not submit a transaction that represents a sale to any principal, partner, proprietor, or owner of Provider; and (f) you shall not submit a transaction involving your own payment methods, e.g., corporate cards issued to your employees.

10.2. You further represent, warrant and covenant to us that:

(a) You have necessary power and authority to enter into this Agreement and certificates, licenses, authorizations and/or approvals to perform your obligations hereunder to (i) provide the goods and services for which a payment may be accepted; and that (ii) your provision of such goods and services do not violate applicable law.

(b) There is no claim, litigation, proceeding, arbitration, investigation or material controversy pending, against or affecting you that will have a material adverse effect on your or Scratch's ability to perform its obligations under this Agreement.

(c) To the best of your knowledge, no such claim, litigation, proceeding, arbitration, investigation or material controversy has been threatened or is contemplated against you.

(d) Any information furnished by you is true and correct in all material respects when furnished; and you shall immediately notify Scratch of updates and corrections to such information in the event any portion becomes untrue or incorrect.

11. SUSPENSION, TERMINATION, ACCOUNT CLOSURE

11.1. Suspension. You agree, acknowledge and understand that, notwithstanding anything in this Agreement to the contrary, Scratch may, in its sole discretion, suspend your access to and use of the Payment Services, if we suspect that you are or may be in breach of this Agreement, any Agent's terms of service, applicable law, or if an Agent or government authority instructs us to suspend your use of the Payment Services. If your access to and use of the Payment Services has been suspended, you may still be permitted to use Scratch's other products at our sole discretion.

11.2. Termination. You agree, acknowledge and understand that, notwithstanding anything in this Agreement to the contrary, Scratch may, in its sole discretion, terminate your access to and use of the Payment Services. We will make commercially reasonable efforts to provide you with prior notice of such termination, however, we may not give you prior notice if: (a) you close your Scratch Account, (b) we terminate as a result of your breach of this Agreement, an Agent's terms of service or applicable law, (c) an Agent or government authority instructs us to terminate your use of the Payment Services, or (d) we terminate as a result of negative publicity relating to or arising from your performance, non-performance, or delivery of goods and/or services. If your access to or use of the Payment Services has been terminated, you may still be permitted to use Scratch's other products at our sole discretion.

11.3. Effect of Suspension, Termination. Upon suspension or termination of this Agreement, you shall immediately cease using the Payment Services until such suspension is lifted by Scratch. In the case of termination, all licenses or other rights granted to you shall immediately and automatically terminate and revert to their owners. You shall immediately remove all signage, logos, marketing materials and similar displays relating to Scratch or the use of the Payment Services from your physical and online locations and all Client channels. Notwithstanding a suspension or termination, you shall remain responsible and liable under this Agreement, and Agents’ terms of service, for transactions submitted for processing prior to suspension or termination, including for subsequent refunds and Chargebacks. Any Settlements due at or after the time of suspension or termination will be paid out according to the terms hereof.

11.4. Survival. Any provision of this Agreement which by its nature extends beyond the termination of this Agreement, will survive the termination of this Agreement, including: Sections 1.2-1.5; 2; 4-9; and 12-16.

12. CONFIDENTIALITY

12.1. “Confidential Information”means information material to the operations of the Parties that cannot be learned outside of that Party’s business. Confidential Information exists in all forms: written, spoken, observed, electronic, and otherwise. Except as provided below, the Party receiving Confidential Information (“RP”) shall keep confidential and not disclose to any third party, the disclosing Party's (“DP”) Confidential Information, or any of the terms and conditions of this Agreement, without the prior written consent of the DP. The RP shall take care to prevent the disclosure of DP’s Confidential Information with at least the same degree of care that RP takes to protect its own confidential information of a similar nature, but in any case, no less than an appropriate and reasonable degree of care.

12.2. RP may disclose DP’s Confidential Information to its employees, service providers and affiliates who are informed of the confidential nature of the information and have agreed to be bound by confidentiality obligations at least as stringent as those herein and where such disclosure and/or utilization of Confidential Information is solely for the purpose of (a) performing RP’s obligations under this Agreement or (b) when required to be disclosed by law, regulation, court order, or other legal authority, provided that prior to the disclosure of Confidential Information, RP will, as applicable, (x) notify and reasonably cooperate with DP prior to disclosure so that DP has an opportunity to seek a protective order or other relief, (y) disclose only such information as is required by the law or regulation or court order or other legal authority, and (z) use commercially reasonable efforts to obtain confidential treatment of any Confidential Information so disclosed.

12.3. A RP’s confidentiality obligations shall not apply to (a) information in the public domain, except where such information entered the public domain due to a breach of this Agreement, (b) that RP rightfully possessed before it received the Confidential Information from DP, (c) is furnished to RP by a third party free of any obligation of confidentiality, or (d) is developed by RP wholly independent from the Confidential Information.

12.4. RP agrees to return or destroy DP’s Confidential Information (in any form and including all summaries, copies and excerpts) promptly following DP’s request. At DP’s option, RP will provide written certification of its compliance with this paragraph within seven days following the date of such request.

12.5. In the event of any breach of a Party's confidentiality obligations, the Parties agree that the non-breaching Party will suffer irreparable harm and the total amount of monetary damages for any injury to the non-breaching Party from any violation by the breaching party will be difficult or impossible to calculate and will therefore be an inadequate remedy. Accordingly, the Parties agree that the non-breaching Party may obtain temporary and permanent injunctive relief against the breaching Party, in addition to any other rights or remedies that the non-breaching Party may be entitled at law, in equity, and under this Agreement.

12.6. No Party shall obtain any proprietary rights in any Confidential Information that has been (or at any time after the date of this Agreement is) disclosed, directly or indirectly, to it by another person under this Agreement, except as may be expressly provided in this Agreement.

12.7. You may not, without Scratch's express written approval, issue any press release or otherwise advertise, make a public statement or disclose to any third party any information about the Parties' relationship under this Agreement, the existence of this Agreement or payments between Clients and you, except as otherwise provided for in this Agreement.

12.8. Except for information owned by an Agent, you acknowledge that Scratch owns all other information concerning the Payment Services, including your Scratch Account (collectively, "Scratch Information"), and that you have no ownership rights therein. You shall treat such Scratch Information as Scratch's Confidential Information. For clarity, the foregoing does not prevent you from collecting and owning information about a Client unrelated to the Payment Services (for example, information about a Client relating to its receipt of your goods and services), and such information shall not be considered Scratch Information. Transaction and related information arising from the Payment Services not deemed Scratch Information shall be governed by your agreement with the relevant Agent.

13. DATA PROTECTION

13.1. You are fully responsible for your collection, storage, disclosure and use of, and access to, Scratch Information under your control or made available to you under this Agreement. You shall prevent collection, storage, disclosure, use of, and access to, Scratch Information not expressly authorized by this Agreement. Without limiting your other obligations hereunder (including your confidentiality obligations), you shall implement and maintain a comprehensive and effective written information security program appropriate to the nature of the Scratch Information that: (a) contains administrative, technical and physical safeguards to identify, assess and protect against any reasonably foreseeable anticipated or actual threats and hazards (whether internal or external) to the security and integrity of Scratch Information, including threats of loss, theft, unauthorized access, use, disclosure and other unauthorized processing of Scratch Information and any failure of security controls protecting Scratch Information, (b) meets industry best practices for such safeguards, and (c) complies with all applicable data protection and privacy laws.

13.2. You shall monitor the sufficiency of your safeguards. You shall review the scope of your security measures at least annually. Such review shall include risk assessments, regular testing, and otherwise monitoring the effectiveness of key controls, systems and procedures to confirm your safeguards are operating in a manner that is reasonably calculated to prevent and detect unauthorized access to, use, and disclosure of Scratch Information. Scratch reserves the right to review, upon request, your policies, procedures and practices used to maintain the privacy, security and confidentiality of Scratch Information.

14. INTELLECTUAL PROPERTY

14.1. Notwithstanding anything in this Agreement (other than Section 3.2), Scratch owns all intellectual property rights, title and interest in and to the Payment Services, including the Scratch name, trademarks, copyrights, processes, trade secrets or other such proprietary rights, any Scratch documentation and technology (including the Dashboard), and anything developed by Scratch hereunder.

14.2. Except for any licenses granted to you, nothing in this Agreement is intended to transfer or assign any such intellectual property rights to you. Any rights not expressly granted are reserved by Scratch (subject to Section 3.2).

14.3. You agree that you shall neither attempt, nor disassemble, decompile or otherwise reverse-engineer any software, code or other trade secret provided by Scratch and Agent.

14.4. You hereby grant Scratch a non-exclusive license to use your name, trademarks, logos and other marks in connection with the administration and operation of the Payment Services, for inclusion in marketing materials relating to the Payment Services (solely to reflect your use of the Payment Services), and collecting or liquidating any Scratch Accounts.

15. BINDING INDIVIDUAL ARBITRATION Provider and Scratch agree to arbitrate any claim, controversy, or dispute between Provider and Scratch, including any claims relating in any way to this Agreement or the Payment Services, or any other aspect of the relationship between Provider and Scratch (collectively, "Disputes"). ANY ARBITRATION UNDER THIS AGREEMENT WILL ONLY BE ON AN INDIVIDUAL BASIS; CLASS ARBITRATIONS, CLASS ACTIONS, REPRESENTATIVE ACTIONS, AND CONSOLIDATION WITH OTHER ARBITRATIONS ARE NOT PERMITTED. PROVIDER WAIVES ANY RIGHT TO HAVE ITS CASE DECIDED BY A JURY AND ANY RIGHT TO PARTICIPATE IN A CLASS ACTION AGAINST SCRATCH. If any provision of this arbitration agreement is found unenforceable, the unenforceable provision will be severed, and the remaining arbitration terms will be enforced (but in no case will there be a class or representative arbitration). All Disputes will be resolved finally and exclusively by binding individual arbitration with a single arbitrator (the "Arbitrator") administered by the American Arbitration Association (https://www.adr.org) according to this Section and the applicable arbitration rules for that forum. The Arbitrator shall be responsible for determining all threshold arbitrability issues, including issues relating to whether this Agreement or any other agreement between the Parties (or any aspect thereof) are enforceable, unconscionable or illusory and any defense to arbitration, including waiver, delay, laches, or estoppel. Subject to applicable jurisdictional requirements, Provider may elect to pursue its claim in its local small-claims court rather than through arbitration so long as the matter remains in small claims court and proceeds only on an individual (non-class or non-representative) basis. The Federal Arbitration Act, 9 U.S.C. §§ 1-16, fully applies. If Provider is a consumer bringing a claim relating to a transaction intended for a personal, household, or family use, any arbitration hearing will occur within the county where Provider is located. Otherwise, any arbitration hearing will occur in Los Angeles, California, unless the parties mutually agree to another location. The arbitrator's award will be binding on the parties and may be entered as a judgment in any court of competent jurisdiction. While an arbitrator may award declaratory or injunctive relief, the Arbitrator may do so only with respect to the individual Party seeking relief and only to the extent necessary to provide relief warranted by the individual Party's claim. The Arbitrator's decision and judgment thereon will not have a precedential or collateral estoppel effect. Scratch will reimburse the arbitration fees due to the American Arbitration Association for individual arbitrations brought in accordance with this Section for all claims totaling less than $10,000 unless the Arbitrator determines that Provider's claims were frivolous. If either Party prevails on any claim for which the prevailing Party is legally entitled to attorney's fees, the prevailing Party may seek to recover those fees from the Arbitrator. For purposes of this arbitration provision, references to Provider and Scratch also include respective subsidiaries, affiliates, agents, employees, predecessors, successors and assigns as well as authorized users or beneficiaries of the Payment Services.

16. MISCELLANEOUS

16.1. Force Majeure.  A party shall not be deemed to be in default under this Agreement, and no party will hold the other party responsible for, any interruption or delay in the performance of its obligations under this Agreement (except for Provider's payment obligations), due to earthquake, flood, fire, storm or similar natural disaster; war, terrorism or similar armed conflict; or labor strike, lockout, or boycott; provided that the party relying upon this paragraph must promptly give the other party written notice upon discovery of the relevant force majeure event, and will take all steps reasonably necessary under the circumstances to mitigate the effects of the force majeure event upon which such notice is based; provided further that the force majeure event does not relieve the affected party from performing its other obligations to the extent not affected by such force majeure event. In the event a force majeure event extends for a period in excess of 30 days, either party may immediately terminate the Agreement.

16.2. Independent Contractors. Neither Party nor its employees, consultants, contractors or agents are considered agents, employees or joint ventures of the other. Such persons do not have authority to bind the other Party by contract or any other obligation, and each Party shall ensure that such persons shall not represent to the contrary, expressly or implicitly, by appearance or otherwise, that they have authority to bind the other Party by contract or any other obligation.

16.3. Assignability.
Provider may not assign this Agreement, or its rights and obligations hereunder without the prior written consent of Scratch.

16.4. Choice of Law and Venue. This Agreement and the rights of the parties hereunder shall be determined, governed by and construed in accordance with the laws of the State of California without regard to conflicts of laws principles. Subject to and without waiver of the arbitration provision set forth in Section 15 (other than small claims actions in consumer cases discussed therein), Disputes under this Agreement shall be resolved solely by a court having its situs within Los Angeles County, CA, and the parties consent and submit to the jurisdiction of any court located within such venue.

16.5. Attorneys' Fees and Costs. For the Parties' mutual benefit, if any action is commenced to enforce, interpret, or in any way relates to this Agreement, the prevailing Party is entitled to its reasonable attorneys' fees and costs.

16.6. Entire Agreement. This Agreement constitutes the entire agreement between the Parties and is the final expression of the Parties' understanding. No prior discussions or communications shall form any part of this Agreement, unless expressly noted herein.

16.7. Modifications.
Scratch may, from time to time, revise the terms and conditions of this Agreement, including by revising the Provider Fees in the Pricing Schedule, and such revisions shall be binding on Provider and effective upon the earlier of: (i) written notice to Provider (if any); (ii) 30 days after posting the revised Agreement or posting a link to the Agreement on the Scratch Account; (iii) Provider's use of the Payment Services after posting or linking to the revised Agreement on the Scratch Account; or (iv)Provider enabling and use of the Financing Product on terminals after posting the revised Agreement or linking to the revised Agreement on the Scratch Account (if applicable). Provider agrees to periodically review the Scratch Account or this website for the posting of revised versions of this Agreement.

16.8. Construction. Headings contained in this Agreement are for convenience only and do not constitute a limitation of the Agreement terms. The singular includes the plural, and the plural includes the singular. All references to "herein," "hereunder," "hereinabove," or like words shall refer to this Agreement as a whole and not to any particular section, subsection, or clause contained in this Agreement. The terms "include" and "including" are not limiting. Reference to any agreement or other contract includes any permitted modifications, supplements, amendments, and replacements.

16.9. Third Party Beneficiaries. This Agreement is intended for the sole and exclusive benefit of the parties, and is not intended for the benefit of any third party.

16.10. Notices. . All notices and other communications under this Agreement shall be given in writing and shall be deemed to have been duly given and effective upon receipt if delivered by hand or nationally recognized overnight carrier (with proof of delivery), or email. Notice to Scratch must be sent to (a) Scratch Financial, Inc., 225 S. Lake Avenue, Suite 250, Pasadena, CA 91101, Attn: Legal Department, or (b) [email protected], Attn: Legal Department, unless a different address for notice is later provided in writing.

16.11. Severability.
If any provision of this Agreement is deemed unenforceable or invalid, such unenforceability or invalidity will not render the Agreement unenforceable or invalid as a whole. In such an event, the provision deemed unenforceable or invalid will be changed or interpreted so as to best accomplish the objectives of such provision within the limits of applicable law and court decisions.

16.12. Waiver.
No failure on the part of Scratch or Agent to exercise, and no delay in exercising, any right hereunder or any other ancillary agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.