PRIME MERCHANT GROUP, LLC

SUB-AFFILIATE AGREEMENT




This SUB-AFFILIATE AGREEMENT (“Agreement”) is between:

  • Prime Merchant Group, LLC, a Delaware limited liability company (“Prime Merchant Group” or the “Company”), and
  • The business whose legal name and details are provided in this form (“Sub-Affiliate”).

By completing this form, checking the “I Agree” box, and signing electronically, the signer confirms they are authorized to bind the Sub-Affiliate to this Agreement.

Effective Date: The date this form is electronically signed and submitted.

1. Purpose and Relationship

1.1 Purpose. The Company is a merchant services provider using third-party payment gateway and processing partners (including Network Merchants, LLC d/b/a NMI, the “Platform Provider”). Sub-Affiliate wishes to (a) participate in the Company’s affiliate/referral program and/or (b) maintain its own merchant account(s) through the Company.

1.2 Independent Contractor. Sub-Affiliate is an independent contractor, not an employee, partner, franchisee, or agent of the Company, the Platform Provider, or any bank or processor. Sub-Affiliate has no authority to bind them.

1.3 No Sublicensing. Sub-Affiliate may not grant any sublicenses, appoint sub-agents, or create its own sub-affiliates or resellers for the Services without the Company’s prior written consent.

1.4 Platform Provider Not a Party. The Platform Provider (including NMI) is not a party to this Agreement and has no obligations or liability to Sub-Affiliate under this Agreement. All rights and obligations here are between the Company and Sub-Affiliate only.

2. Definitions

2.1 Platform Provider. The payment gateway and related technology provider(s) used by the Company from time to time (currently including Network Merchants, LLC d/b/a NMI).

2.2 Platform Provider Terms. The online and written terms, policies, and security requirements published by the Platform Provider and applicable to the Company, merchants, sub-affiliates, and users of the platform, as modified from time to time.

2.3 Services. The Company’s branded access to payment processing, gateway, reporting, and related services provided through the Company and its processing partners.

2.4 Eligible Merchant Account. A merchant account that (a) is boarded through the Company and accepted by the Company’s processing partners, and (b) is tagged by the Company in its systems as being associated with Sub-Affiliate for commission purposes.

2.5 Referred Merchant. A merchant introduced to the Company by Sub-Affiliate that the Company, in its sole discretion, accepts, boards, and links to Sub-Affiliate as an Eligible Merchant Account.

2.6 Net Processing Revenue. For a given Eligible Merchant Account and period, the aggregate processing-related fees actually received by the Company that are attributable to that account, minus:

  • Interchange fees and card-brand assessments;
  • Amounts owed to sponsor banks, processors, and the Platform Provider (including their revenue share);
  • Chargebacks, refunds, reversals, fraud losses, fines, penalties, and related costs; and
  • Taxes, third-party costs, and other similar expenses the Company reasonably allocates to that account.

Net Processing Revenue will not be less than zero.

2.7 Commissionable Revenue. The portion of Net Processing Revenue that the Company designates as eligible for commission for a given Eligible Merchant Account. Unless the Company specifies otherwise in writing, Commissionable Revenue generally consists of the markup component of the merchant discount rate and per-transaction fees above the Company’s internal cost and floor pricing for that account.

2.8 Non-Commissionable Fees. Any amounts the Company earns that it does not include in Commissionable Revenue, which may include, without limitation: gateway/platform fees, monthly or annual fees, statement fees, PCI or compliance fees, setup/activation fees, chargeback and retrieval fees, equipment or software fees, value-added services, surcharges, convenience fees, and any other fees that the Company designates as non-commissionable in its discretion. No commissions are paid on Non-Commissionable Fees.

2.9 Payee Account. The bank account whose details Sub-Affiliate provides in this form for receipt of commission payments.

3. Use of Services; Compliance

3.1 Limited License. The Company grants Sub-Affiliate a limited, revocable, non-exclusive, non-transferable license to use the Services only to:

  • Manage its own merchant account(s) under the Company;
  • View reports and commissions related to its account(s); and
  • Submit and track referrals to the Company.

3.2 Platform Provider Terms. Sub-Affiliate agrees to comply with all Platform Provider Terms and security requirements that the Company communicates or makes available, including the Platform Provider’s Partner and General Terms to the extent they apply to users and sub-affiliates.

3.3 Laws and Card Rules. Sub-Affiliate must comply with all applicable laws, regulations, card-brand rules, NACHA rules, sanctions and export control laws (including OFAC and similar regimes), anti-money laundering and anti-bribery laws, and other industry standards related to payments, data security, and marketing.

3.4 Data Security and Breach Response.
Sub-Affiliate must protect cardholder data, login credentials, and other sensitive information and comply with PCI-DSS where applicable. Sub-Affiliate shall not store full card numbers, CVV/CVC, track data, or PIN blocks except where expressly permitted by law, card rules, PCI-DSS, and the Company’s written instructions—and then only as required.

If Sub-Affiliate becomes aware of or suspects any actual or potential security incident, compromise, or misuse affecting cardholder data, the Services, or access credentials:

  • It shall notify the Company immediately (without undue delay);
  • It shall provide all information the Company, the Platform Provider, sponsor bank, card brands, or regulators reasonably request regarding the incident; and
  • It shall cooperate fully with the Company and its partners in investigation, remediation, required notifications, and any audits or assessments related to the incident.

3.5 Marketing. Sub-Affiliate shall:

  • Use only Company-approved descriptions and materials when promoting the Services;
  • Not publish, distribute, or send any marketing that references the Company, the Platform Provider, card brands, or the Services without the Company’s prior written approval; and
  • Comply with all telemarketing, email, SMS, and privacy laws (no spam, no deceptive or abusive practices).

3.6 Prohibited Merchants and Activities.
Sub-Affiliate shall not, without the Company’s prior written approval:

  • Solicit, refer, or attempt to board any merchants in categories the Company, the Platform Provider, sponsor banks, or card brands designate as prohibited or restricted from time to time; or
  • Use the Services for any illegal, high-risk, or prohibited purposes, including but not limited to activities involving unlawful gambling, unlicensed money services, child exploitation, unlawful adult content, illegal drugs or controlled substances, counterfeit goods, or any other activities prohibited under Platform Provider Terms, card-brand rules, or applicable law.

The Company may provide Sub-Affiliate with lists or notices of prohibited or restricted merchant types, which Sub-Affiliate shall follow. The Company may immediately suspend or terminate this Agreement or any merchant relationship if Sub-Affiliate violates this Section.

3.7 Cooperation on Risk, Compliance, and Audits.
Sub-Affiliate shall promptly cooperate with reasonable requests from the Company, the Platform Provider, sponsor banks, card brands, and regulators for information, documents, and assistance relating to merchants, referrals, transactions, chargebacks, risk reviews, and compliance audits, including responding to inquiries within the timeframes the Company reasonably specifies.

4. Merchant Accounts (Separate Agreements; Portfolio Protection)

4.1 Separate Merchant Agreement. To process payments, Sub-Affiliate (if it wishes to be a merchant) must sign one or more Merchant Agreements with the Company and/or the Company’s processing partners. Those Merchant Agreements govern all processing terms, pricing, chargebacks, and settlement. This Agreement does not guarantee approval of any merchant account.

4.2 Priority. If there is a conflict between this Agreement and a Merchant Agreement:

  • The Merchant Agreement controls for processing, pricing, and funding; and
  • This Agreement controls for commissions and the affiliate relationship.

4.3 Ownership of Merchant Relationships. All merchants and merchant accounts under the Company are owned and controlled by the Company and its processing partners. Sub-Affiliate does not own any merchant or residual stream, except for its right to commissions under this Agreement and the applicable Commission Plan.

4.4 Non-Solicitation of Merchants; Non-Circumvention.
(a) During the term of this Agreement and for twelve (12) months after its termination, Sub-Affiliate shall not, directly or indirectly, for itself or any third party:

  • Solicit or attempt to solicit any merchant that became known to Sub-Affiliate through the Services or this relationship, for the purpose of moving that merchant’s payment processing, gateway, or related services from the Company or its processing partners to another provider; or
  • Induce or attempt to induce any such merchant to reduce or terminate its processing relationship with the Company or its processing partners, except through the Company’s own processes.

(b) Sub-Affiliate shall not use any merchant, portfolio, pricing, or transaction data obtained through the Company or the Services to:

  • Build or support a competing portfolio or program; or
  • Circumvent the Company by routing business directly to another processor, ISO, gateway, or bank.

(c) Nothing in this Section 4.4 prohibits a merchant from independently choosing another provider on its own initiative, without solicitation, but Sub-Affiliate shall not promote, encourage, or assist such movement in violation of this Section.

5. Commissions and Commission Plan

5.1 Commission Plan.

(a) Commissions will be calculated and paid in accordance with the Company’s then-current commission plan or schedule for sub-affiliates that is specifically designated as applying to Sub-Affiliate (the “Commission Plan”).

(b) The Commission Plan may set out, among other things, the commission rates, tiers, and rules that apply to:
(i) Eligible Merchant Accounts owned or controlled by Sub-Affiliate; and
(ii) Eligible Merchant Accounts of Referred Merchants that are not owned by Sub-Affiliate.

(c) Unless stated otherwise in the Commission Plan, commissions are determined as a percentage or other share of Commissionable Revenue for each Eligible Merchant Account.

(d) The Company will provide Sub-Affiliate with its initial Commission Plan (or a link to it) at or shortly after onboarding, and the Commission Plan is incorporated into this Agreement by reference.

5.2 Company Discretion on Revenue Classification and Eligibility.

(a) The Company retains the right to determine, in its reasonable discretion, the pricing, internal cost/floor, and classification of revenue as Commissionable or Non-Commissionable for each merchant account.

(b) The Company also retains the right to determine, in its sole discretion, whether a merchant qualifies as a Referred Merchant and whether a merchant account is an Eligible Merchant Account.

(c) Sub-Affiliate is entitled only to the commissions expressly described in this Agreement and the applicable Commission Plan.

5.3 Commission Plan Changes.
The Company may update or modify the Commission Plan at any time in its sole discretion. Unless the Company states otherwise in writing, any updated Commission Plan will apply only to commissions calculated on transactions processed after the effective date of the update. The Company may communicate updates by email and/or by posting the updated Commission Plan in a partner portal or other online location designated by the Company. If Sub-Affiliate does not wish to accept an updated Commission Plan, its sole remedy is to stop referring merchants and terminate this Agreement before the effective date of the update. Sub-Affiliate’s continued participation in the program after the effective date of any update will constitute acceptance of the updated Commission Plan.

5.4 Calculation and Payment.
The Company calculates commissions monthly in arrears based on reports from its processing partners and the Platform Provider. The Company’s records control unless there is a clear error. The Company will use reasonable efforts to pay commissions within [30] days after each month via ACH to the Payee Account, provided total commissions for that month are at least [e.g., $50]. Smaller amounts may roll forward.

5.5 Adjustments & Set-Off.
The Company may hold, reduce, or reverse commissions, or set off against amounts Sub-Affiliate owes, if:

  • Fees have not yet been collected from merchants;
  • Transactions are refunded, reversed, charged back, or suspected as fraudulent;
  • Fines, penalties, or losses arise from any related merchant account; or
  • Sub-Affiliate owes the Company money under this Agreement or any Merchant Agreement.

5.6 No Commission on Prohibited Activity.
No commission is earned on any transaction or merchant that the Company or its partners consider fraudulent, illegal, prohibited under Section 3.6, or in violation of this Agreement, a Merchant Agreement, or applicable law/card rules.

5.7 Taxes.
Sub-Affiliate is solely responsible for reporting and paying all federal, state, and local taxes and other governmental charges related to commissions paid under this Agreement. As a condition to payment, Sub-Affiliate will provide the Company with any tax reporting information the Company reasonably requests (including IRS Form W-9 or W-8, as applicable) and keep such information current. The Company may issue IRS Form 1099 or other tax reports as required by law and may withhold amounts from commission payments if required by applicable tax law (including backup withholding).

5.8 Fees Payable by Sub-Affiliate.
The Company may charge Sub-Affiliate fees for affiliate tools, portals, or services under this Agreement, if and as agreed in a separate fee schedule or order form. Sub-Affiliate must pay those fees when due. All processing-related fees are governed by the applicable Merchant Agreement(s), not this Agreement.

6. ACH Authorization (Commissions)

By providing bank account details in this form and submitting it, Sub-Affiliate:

  • Authorizes the Company and its payment providers to send ACH credits to the Payee Account for commissions; and
  • Authorizes the Company and its payment providers to send ACH debits if necessary to correct errors or reversals.

Sub-Affiliate confirms it owns or is authorized to use the Payee Account and that the account details provided are accurate. Sub-Affiliate will give the Company at least ten (10) business days’ notice before changing the Payee Account and understands that changes may temporarily delay payments.

7. Term and Termination

7.1 Term. This Agreement starts on the Effective Date and continues until terminated.

7.2 Termination for Convenience. Either Party may terminate this Agreement at any time with thirty (30) days’ written notice.

7.3 Immediate Termination by the Company. The Company may suspend or terminate immediately if Sub-Affiliate:

  • Breaches this Agreement or any Merchant Agreement;
  • Engages in fraud, illegal activity, or conduct that could harm the Company, the Platform Provider, banks, or card brands;
  • Violates law, card-network rules, Platform Provider Terms, or the Company’s policies; or
  • Becomes insolvent or ceases business.

7.4 Automatic Termination with Platform Provider. This Agreement automatically ends thirty (30) days after the Company’s master agreement with the Platform Provider for these Services ends, for any reason. The Company may choose to end it sooner on notice.

7.5 Effect of Termination. When this Agreement ends:

  • Sub-Affiliate’s rights to use the Services as a sub-affiliate stop immediately;
  • Sub-Affiliate must stop using the Company’s brand and any Company/Platform Provider marketing;
  • The Company will pay any undisputed commissions earned up to the termination date, subject to normal adjustments and set-off; and
  • Sections that should reasonably survive (including commissions due, confidentiality, IP, indemnity, limitations of liability, non-solicitation, and governing law) will remain in effect.

8. Intellectual Property and Confidentiality

8.1 IP Ownership. The Company, the Platform Provider, and their partners own all rights in the Services, platform, software, and related materials. Sub-Affiliate receives no ownership rights, only the limited use rights described in this Agreement.

8.2 Marks. Sub-Affiliate may use the Company’s name and Company-approved materials only to promote the Services under this Agreement and must follow the Company’s branding rules. Sub-Affiliate may not use the Platform Provider’s, card brands’, or processors’ logos or names unless the Company gives written permission. Sub-Affiliate may not register any brand names, domains, or social handles that are confusingly similar to the Company, the Platform Provider, or the Company’s partners.

8.3 Confidentiality. Each Party may share non-public business information (“Confidential Information”) with the other through this form and in the course of this relationship. The receiving party will:

  • Use it only for purposes of this Agreement;
  • Protect it at least as carefully as its own confidential information; and
  • Only share it with people who need to know and who are bound by confidentiality obligations.

Public information, independently developed information, or information from a third party without breach is not Confidential Information.

8.4 Merchant and Portfolio Information.
Without limiting the foregoing, all information about the Company’s merchants, pricing, transaction volumes, chargeback activity, and portfolios that Sub-Affiliate receives or accesses in connection with this Agreement is Confidential Information of the Company and may be used by Sub-Affiliate solely to perform under this Agreement, and not to compete with or circumvent the Company or for the benefit of any other provider.

9. Liability and Indemnity

9.1 No Special Damages. To the fullest extent allowed by law, neither the Company, nor the Platform Provider, nor any processing partner is liable to Sub-Affiliate for indirect, incidental, special, or consequential damages, or for lost profits or revenue, arising from this Agreement.

9.2 Liability Cap. Except for (a) Sub-Affiliate’s indemnity duties, (b) Sub-Affiliate’s breach of data or confidentiality obligations, or (c) unpaid fees/charges, each Party’s total liability to the other under this Agreement is limited to the total commissions paid or payable to Sub-Affiliate in the twelve (12) months before the claim.

9.3 Indemnity by Sub-Affiliate.
Sub-Affiliate will indemnify and defend the Company, the Platform Provider, processing partners, and their personnel against claims, losses, fines, and costs (including reasonable attorneys’ fees) arising from:

  • Sub-Affiliate’s breach of this Agreement or any Merchant Agreement;
  • Sub-Affiliate’s violation of laws, card rules, Platform Provider Terms, or the Company’s policies;
  • Misstatements or promises Sub-Affiliate makes to merchants or prospects; or
  • Data breaches, security incidents, or misuse of credentials caused by Sub-Affiliate.

The Platform Provider and the Company’s processing partners are intended third-party beneficiaries of this indemnity and may enforce it directly.

10. Miscellaneous

10.1 Governing Law and Venue. This Agreement is governed by the laws of the State of Delaware. Any disputes must be brought in the state or federal courts located in New Castle County, Delaware, and both Parties consent to that jurisdiction and venue.

10.2 Assignment. Sub-Affiliate may not assign or transfer this Agreement without the Company’s written consent. The Company may assign this Agreement to an affiliate or in connection with a sale, merger, or reorganization of its business.

10.3 Entire Agreement; Changes. This Agreement is the entire agreement between the Parties about the sub-affiliate relationship and replaces any prior discussions. Changes must be in writing and signed (including electronically) by both Parties, except that the Company may modify the Commission Plan as provided in Section 5.3.

10.4 Notices. Notices may be sent by personal delivery, overnight courier, or email to the contact information provided in this form or updated in writing.

10.5 Severability. If any part of this Agreement is found invalid, the rest remains in effect, and the invalid part will be replaced with a valid one closest to the original intent.

10.6 No Waiver. If either Party fails to enforce a provision once, it does not waive the right to enforce it later.