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CONSUMER PAYMENT IN THE COURT OF COMMON PLEAS
SERVICES, A Division of CUMBERLAND COUNTY, PENNSYLVANIA
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
NO. 99 - 3840 EQUITY
IN EQUITY
AFFIDAVIT OF SERVICE
TO THE PROTHONOTARY:
Attached are the original Affidavits of service upon all
above named Defendants. Service was effected in accordance
with Pa. R.C.P. No. 400(b).
Respectfully submitted,
& CHeRX-1r6FF, P. C.
Date:June 28. 1999
FTbrdan D Cunningham, Esquire
I.D. W'144
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
Telephone: (717) 238-6570
(Attorneys for Plaintiff)
BRESLIN SPECIALIZED SERVICES
_ ??
.? National
Association of
Professional
Process Servers P.O. Box 325, -
Upper Darby, PA 19082
(610) 734-1647 Phifadel4hia
Associatson of
Professional
Process Semen i
k
AFFIDAVIT OF SERVICE r
PLAINTIFF(S) a Wun t t enm a rsv. wuN i t
Consumer Payment Services 99 - 3840 Cumberland
DEFENDANT(S) DATE RECEIVED SERVE SY
Curren Di ass
SERVE AT O Ci rmmons -?- O Subpoena
R al Estat S
8121 Old York Rd. O Wrltof )mt01her
Elkins Park PA Order of 6-24-99, Petition for
SPECIAL INSTRUCTIONS
Served and made known to currency Direct I
on the 25 day of June .19 99 at 2:37 o'clock, P. M.,
at 1171050 RnnQCVOI* Alirri Countyof Phila.
Commonwealth of Pennsylvania, In the manner described below:
0 Defendant(3) personally served.
O Adultlarnly memberwith whom said Defendant(s) reside(s). Relationship Is
• Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clark of place of lodging In which Defendant(s) reside(s).
O Agent or person In charge of Defendant's off lee or usual place of business.
A oA..sa,-a rr°' °'Gi Sonior V R ----An ofterof said Defendant company.
O Other --
DESCRIPTION AGE 35- 40 HEIGHT 6' 1" WEIGHT 185 lbsAACE 14 SEX M OTHER
On the day of 19. at o'clock, M.,
Defendant not found because: O Moved O Unknown O No Answer O Vacant O Other
NAME OF SERVER
_ being duty swom according to raw, deposes and -
eeye that he/she is a process server herein named and that the facts herein set forth
above are true and correct to the beef of their knowledge, information and belief. f '° Cau Coo
nry
- _ _:. 2001
- "-u.o'orie
Sheriff Procees Server/ Competent Adult
' i
DEPUTIZED SERVICE
Now, this day of 19 I do hereby deputize the Sheriff of County.
to serve this O Summons O Complaint O Other and make return thereof and according to Law.
By (Competent Adult)
County Sheriffs Check
Law Finn CUnninnham Cherniroff
Attorney's Name Marr`w. Wit7,ir. rcn- For Plnint:ifE
Address 997f1 bj c... QAd c..
Harrisbura PA 17106
Telephones 717-218-697n IdentHloatlon0
ATTEST
PRO PROTHY
DATE
019M Philadelphia Assoc. of ProfeeelorW Process Servers Rev 1
BRESLIN SPECIALIZED SERVICES
?7?= National
?- Association of
S Professional
Proms Servers
P.O. Box 325
Upper Darby, PA 19082
(610) 734-1647
AFFIDAVIT OF SERVICE
Philadelphia
Association of
Professional
Process Semen
PLAINTIFF(S) .n .n, i Mnm o ,ti, ss,un, r
Consumer Payment Services 99 - 3840 Cumberland
DEFENDANT(S) DATE RECEIVED SERVE BV
Neu Direct, Inc 6-25-99 ass
SERVEA7 Civil Action rnerta O Subpoena
O Summons O Notice of Real Estate Sale
8121 Old York Rd. O writof XlOther 2,
Elkins Park, PA
Petition for Pr(pliminar Injunction,
Notice of Deposition, Subpoena
SPECIAL INSTRUCTIONS
Served and made known to Neu Direct Inc
on the 25 day of June -.19 99 'at 4:00 o'clock, P • M.,
at 8121 Old York Rd. Counivol Montgomery
Commonwealth of Pennsylvania, In the manner described below:
O Defendant(s)personallyserved.
O Adultfamllymemberwkh whom said Defendant(s) reside(s). Relationship Is
O Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clerk of place of lodging in which Defendant(s) reside(s).
O Agent or persoe In charge of Defendant's office or usual place of business.
UIX Nnimpri Qurpchi anoffkarofsaid Defendant company.
O Other
DESCRIPTION AGE 30-35 HEIGHT 5'9"
On the day of
Defendant not found because: O Moved O Unknown
WEK3HT 150 lbs RACE Hindu SEX M OTHER
19 at o'clock, M.,
O No Answer O Vacant O Other
NAME OF SERVER
Boyd A. Breslin being duty mom according to law, deposes and
says diet he/she Is a process server herein named and Ow the facts herein set forth
above are true and comet to the beat of dWr knowledge, information and belief.
substxihad before me
LY at , TL,t e+ 19-
Luc::!„ 1,N"'t_ --
fupp°Cnunty
7.. 7
Sheriff
Now, this day
Process Server/ Competent
19 . I do hereby deputize the Sheriff of
toservethb O Summons O Complaint O Other
By (Competent Adult)
County.
and make return thereof and according to Law.
County Sheriff's Check
Law Firm fl,nninciba K rh nff
Aftomey'sNams Marc W Witzig,Rsa For Plaintiff
Address 2320 N Second St
Harrisburg, PA 17106
Telephones 717-?,An-<s70 Identiicatbns
ATTEST
PRO PROTHY
DATE
Quad Philadelphia "we- of Professional Process Servers Rev 1
BRESLIN SPECIALIZED SERVICES
"7?-- National
'- Association of
S Professional
Process Servers P0. 1lox 325
Uppcr Darby, PA 19082
(610) 734-1647 Philadel
Phia
Associahon of
Professional IMM%w
Process Servers
A
L
AFFIDAVIT OF SERVICE J
Y
PLAINTIFF(S) COURT TERM a NO. COUNTY
Consumer Payment Services 99 - 3840 Cumberland
DEFENDANT(S) DATE RECEIVED SERVE BY
Naveed Qureshi 6-25-99 asap
SERVE AT
8121 Old York Rd.
Elkins Park, PA
Ot ClvilAdion COMP. O Subpoena
0 Summons 0 Notice of Real Estate Sale
0 Writ of %M nthr n-q..- ..n a n.
Petition for Pe>itpinary Injunction,
Notice of Deposition, Subpoena
SPECIAL
Served and made known to na.,vea Qe=ty
on the 25 day of June -.19 99 at 4,00 o'clock, P. M.,
at - _8121 MIA Ynrtr RA ,Countyof Montgomery
Commonwealth of Pennsylvania, In the mannerdescdbed below:
)= Defenclant(s) personally served.
0 Adult family rramber with whom said Defendard(s) reside(s). Relationship is
CI Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clark of place of lodging in which Defendant(s) reside(s).
0 Agent or person in charge of Defendant's office or usual place of business.
0 an officer of said Defendant company.
0 Other
DESCRIPTION AGE 30-35 HEIGHT 5'9"
On the day of
Defendant not found because: O Moved D Unknown
NAME OF SERVER
WEIGHT 1501bs. RACE Hindu SEX M OTHER
19 at o'cock, M.,
0 No Answer 0 Vacant O Other
Boyd A. Breslin being duty swom according to law, deposes and
says that he/she is a process server herein named and that the facts herein set forth
above are true and correct to the bast of their knowledge. Intoi nation and belief.
Sheriff
Process Server/ Competent
Now, this day of 19 . I do hereby deputize the Sheriff of
to serve this 0 Summons 0 Complaint 0 Other
By (Competent Aduft)
LawFim ; Chs?rnic-nff
Attomey'sName Marc W. Witzia, Esa. For Plaintiff
Address
arrlsburg PA 17106
County.
and make return thereof and according to Law.
_ County Sheriffs Check $
ATTEST
PRO PROTHY
DATE
to a subscribed before me
No,anal Scal
U, L` .•.1. LV!II;?A Nclary public
D" trey ".'P., Delaware Cunty
My Commission Fxodrs j o
?O I
JM:q
Telephones 717- 238-67570 Identifications 2gg2g
01990 Philadelphia Assoc. of Professional Proew Servers Rev 1
National
_
S Association of
Professional
Process Scmcrs
P.O. Box 325
Uppcr Darby, PA 19082
(610) 734-1647
AFFIDAVIT OF SERVICE
PLAINTIFF(S)
Consumer
Nikos Valvanis
SERVE AT
Services
8121 Old York Rd.
Elkins Park Pa
99 - 3840
DATE RECEIVED
6-25-99
((1 Civil Action rompl ai nQ
O Summons O
O Wrk of O
Philadelphia
Association of
Professional
Process Serves
J?-
Cumberland
asap
of
Petition for Preliminary Injunction
Notice of Deposition, Subpoena
SPECIAL INSTRUCTIONS
Served and made known to tai kns Vat vanis
on the 25 day of Tnno '19 99 at 4:00 o'clock. P. M.,
at 8111 17118 Vnrk Rrl- ,C0unty0f Mnntnnm-rv
Commonwealth of Pennsylvania, In the mannerdescdbed below:
O Defendant(s) personally served.
O Aduft family member with whom said Defendant(s) reside(s). Relationship Is
O Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clerk of place of lodging in which Defendant(s) reakle(s).
1d7 Agent or peraee in charge of Defendant's office or usual place of business. Naveed Qureshi
O an officer of said endanicompany.
O Other
DESCRIPTION AGE 30-35 HEIGHT 5'9" WEIGHT 150 lbs RACE Hindu SEX M OTHER
On the day a 19 at o'clock, M.,
Defendant not found because: O Moved O Unknown O No Answer O Vacant O Other
NAME OF SERVER
Boyd A. Breslin being duty swom according to law, deposes and
says that he/she Is a process server herein named and that the facts herein set forth
above are true and correct to the beat of their knowledge, information and belief.
Sheriff Precess server/ competent Aoun-Ay
DEPUTCZED SERVICE
Now, thcl day of 19 . I do hereby deputize the Sheriff of
to serve this O Summons O Complaint O Other
By (Competent Adult)
County.
and make return thereof and according to Law.
County Sheriffs Check
Law Firm (Innnintribnn, r rln, i,off
AffomeysName Marc W. Witzia For P;aint.iff
Address 2320 n. Second St.
Harrisbura PA 17106
Telephones 717-2386570 Identifications 2,k12c1
GIM Philadelphia ASSOC. of Professional Proeees Servers Rev 1
BRESLIN SPECIALIZED SERVICES
ATTEST
PROPROTHY
DATE
Swam to a subscribed before me INS
at t,: n,
L '•r i1 ;ry Puh!iG
"Ify 4.°001
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CONSUMER PAYMENT:
SERVICES, A Division of :
MERCHANTS EXPRESS
MONEY ORDER
COMPANY,
Plaintiffs
V.
CURRENCY DIRECT,
INC., NEU DIRECT,
INC., NAVEED
QURESHI, and NIKOS
VALAVANIS,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - EQUITY
NO. 99-3840 EQUITY TERM
ORDER OF COURT
AND NOW, this 51h day of July, upon consideration of a document filed by
Defendant Neu-Direct, Inc., entitled Petition for Motion to Quash Subpoena To Attend
and Testify, and the document failing to include a copy of the subpoena in question to
enable the court to understand to whom it is addressed, what it directs, when it is to be
complied with and in what proceeding it is to be returned, the motion to quash is denied.
IT IS ALSO NOTED that Defendant, evidently a corporation, has apparently
attempted to proceed in this motion without legal representation.
BY THE COURT,
J.lWesley Oler, Jr.
1 ,,;?
Jordan D. Cunningham, Esq.
2320 North Second Street
P.O. Box 60457
Harrisburg, PA 17106-0457
Attorney for Plaintiffs
Nikos Valavanis
Vice President
Neu-Direct, Inc.
Suite 200
8121 Old York Road
Elkins Park, PA 19027-1424
:rc
NEU-DIRECT, INC., Plaintiff i IN THE COURT OF COMMON PLEAS
CUMBERLANDCOUNTY,
Vs :PENNSYLVANIA
CONSUMER PAYMENT SERVICES, A i NO:99-3840
Division of MERCHANT'S EXPRESS
MONEY ORDER COMPANY, Defendant IN EQUITY
ORDER
AND NOW, this day of 1999, UPON REVIEW OF THE PETITION OF
PETITIONER, THE COURT ENTERS THE FOLLOWING ORDER:
1) to Quash Subpoena to Attend and Testify, thus enjoining the Records Custodian for the
Law Office of Geoffrey B. Gompers from producing and or providing access to
Defendant, CPS/MEMO, to any and all disks, floppy disks, tapes, printouts, and all
other records in any medium containing the documentation, procedures, source code,
and object work.
2) enjoining the Records Custodian for the Law Office of Geoffrey B. Gompers to return
any and all disks, floppy disks, tapes, printouts, and all other records in any medium
containing the documentation, procedures, source code, and object work to Plaintiff,
Neu-Direct, Inc., at its legal address, 8121 Old York Road, Elkins Park, PA 19027.
BYTHECOURT:
NEU-DIRECT, INC., Plaintiff ; IN THE COURT OF COMMON PLEAS
CUMBERLANDCOUNTY,
Vs : PENNSYLVANIA
CONSUMER PAYMENT SERVICES, A ; NO: 99-3840
Division of MERCHANTS EXPRESS MONEY
ORDER COMPANY, Defendant INEQUITY
PETITION FOR MOTION TO QUASH SUBPOENA TO ATTEND AND TESTIFY
AND NOW, comes your Plaintiff, Neu-Direct, Inc., and Petitions this Court on its behalf
for the issuance of a Motion to Quash Subpoena to Attend and Testify, without hearing,
enjoining the Defendants from having access to any and all disks, floppy disks, tapes,
printouts, and all other records in any medium containing the documentation, procedures,
source code, and object work requested of the Records Custodian for the Law Office of
Geoffrey B. Gompers.
This Motion is respectfully submitted because, as more fully set forth in Plaintiff's
Complaint:
1. Plaintiff, Neu-Direct, Inc., is a Pennsylvania corporation with a principal place of business at
8121 Old York Road, Elkins Park, Montgomery County, Pennsylvania.
2. Defendant, Consumer Payment Services, a division of Merchants Express Money Order
Company, (hereinafter referred to as CPS/MEMO) is a Pennsylvania corporation with a
principal place of business at 1029 Mumma Road, Wormleysburg, Cumberland County,
Pennsylvania.
3. Plaintiff possesses a Certificate of Registration, in accordance with title 17, United States
Code, on file with the United States Copyright Office for the "Bill Pay USA" software
program. A true and correct copy of the Certificate of Registration is attached hereto, and
marked Exhibit "A-1".
4. Plaintiff is the sole owner and developer of the aforementioned software program.
5. Defendant, CPS/MEMO, is using the aforementioned "Bill Pay USA" software program
under the designation of "Consumer Payment Services".
6. Plaintiff does not have any written agreement with Defendant as regards the aforementioned
software program and/or its use, reproduction, transmittal and/or transference. This is
evidenced in Defendant's own correspondence dated May 28, 1999, paragraph 2, "As I have
stated on many occasions to Naveed Qureshi, and Nikos Valavanis last week, CPS does not
have any type of agreement with Neu-Direct." A true and correct copy of the Defendant's
correspondence is attached hereto, and marked Exhibit "A-211
.
7. Moreover, Plaintiff does not have any written agreement with any person(s), entity(s),
corporation(s), and/or organ ization(s).
8. Defendant has made known to Plaintiff, via telephone conversations, Defendant is in the
process of developing a comparable and/or substantially similar software program to that of
"Bill Pay USA". Plaintiff therefore avers Defendant's intent in requesting the aforementioned
materials is to willfully and wrongfully use, reproduce, transmit and/or transfer the
aforementioned software program or documentation, procedures, source code, and object work
to the Defendant and/or other parties.
9. Plaintiff will suffer immediate and irreparable harm if a Motion is not granted because
Defendant's access to any and/or all of the requested materials in the possession of the Law
Office of Geoffrey B. Gompers deprives the Plaintiffof property, intellectual and otherwise, to
which it is entitled by operation of law and which are not redressable by damages, thus putting
Plaintiff out of business. Unless enjoined, the access of the Defendant to any and/or all of the
aforementioned materials will result in a further wasting, diminution and conversion of the
Plaintiffs assets by virtue of the Defendant's opportunity, ability and incentive to use,
reproduce, transmit and/or transfer the Plaintiffs software program or documentation,
procedures, source code, and object work to the Defendant and/or other parties.
10. Moreover, neither the Plaintiff nor the Court, in granting this Motion, will place the
Defendant in a position of. (a.) harm, (b.) inability to conduct its current and/or future day to
day business operation(s), (c.) loss of business and/or business opportunity, (d.) third party
contract default(s), or (e.) vulnerability to civil actions for claim(s), monetary or otherwise.
11. Additionally, neither the Plaintiff nor the Court, in granting this Motion, will place any other
person(s), entity(s), corporation(s), organization(s) and/or members of the general public in a
position of.. (a.) harm, (b.) inability to conduct its current and/or future day to day business
operation(s), (c.) loss of business and/or business opportunity, (d.) third party contract
default(s), or (e.) vulnerability to civil actions for claim(s), monetary or otherwise.
12. Unless the Court grants this Motion, the status quo will not be preserved and the Plaintiff's
property and business will be lost.
13. The Plaintiff has no adequate remedy at law to redress and the current and impending harm
from Defendant's request. The destruction of Plaintiffs property and business by the
Defendant's request is not redressable by monetary damages.
14. The Defendant will not be substantially harmed if the Motion is granted, pending a final
determination of the matter on the merits.
15. There is a substantial likelihood that Plaintiff will ultimately be successful on the merits of the
case.
16. The Defendant will not suffer any appreciable injury if the requested Motion is issued because
the status quo between the parties will be restored to where it was be tore. Defendant wiI I
merely be restrained from taking advantage of its wrongful intent.
17. Defendant will remain free to pursue its legal rights in a lawful manner.
18. Plaintiff is likely to succeed on the merits of its claims.
WHEREFORE, for the reasons set forth above, Plaintiff prays your Honorable Court:
3) Issue an Order to Quash Subpoena to Attend and Testify, thus enjoining the Records
Custodian for the Law Office of Geoffrey B. Gompers from producing and or providing
access to Defendant, CPS/MEMO, to any and all disks, floppy disks, tapes, printouts,
and all other records in any medium containing the documentation, procedures, source
code, and object work.
4) Issue an Order enjoining the Records Custodian for the Law Office of Geoffrey B.
Gompers to return any and all disks, floppy disks, tapes, printouts, and all other records
in any medium containing the documentation, procedures, source code, and object work
to Plaintiff, Neu-Direct, Inc., at its legal address, 8121 Old York Road, Elkins Park, PA
19027.
Date: C-
et'tioner:
N •os Valavanis
Vice President
Neu-Direct, Inc.
Tel: (215) 886-4200
VERIFICATION
I verify that I am the petitioner in the present action and that the facts and statements contained in
the above petition are true and correct to the best of my knowledge, information and belief.. I
understand that any false statements made are subject to the penalties of 18 PA C.S Section 4904
re gto nswo Isifica Tonto authorities.
Nikos Valavanis, 'c sident
Date: 4-1- t--t-
EXHIBIT A-1
CERTIFICATE OF REGISTW-TION
OFFICIAL SEAL
This Certificate issued under the seal of the Copyright
Olfico In accordance with title 17, United Statos Code,
attests that registration has been made for the work idenli•
tied beloW.The information on this ccrtifioate has been
made a part of the Copyright Office rreeords.
QtFTj (fitf,PL0
R GISTER OF COPYRIGHTS
Urufed States ofAmenca
1341 PRY USA Softdom
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EXHIBIT A-2
I
May 28, 1999
Barbara Valavanis
Dear Barbara,
aml vat ntea arc UU aus WIS \k?t
We've received your faxed letter and a copy of a voided check.
As Kelly stated yesterday, it is our opinion that it is not correct for CPS to pay Neu Direct
directly, but rather to pay the party with which we have an agreement, Currency Direct,
Inc., who in turn should be paying Neu Direct. As I've stated on many occasions to
Naveed Qureshi, and Nikos Valavanis last week, CPS does not have any type of
agreement with Neu Direct. Neu Direct is strictly performing services that Currency
Direct is responsible for under an Agreement dated October 7, 1998, and as such if Neu
Direct is a party to any agreement, it would be with Currency Direct.
We also vehemently disagree that payment is in anyway past due, since the check was sent
and delivered to Currency Direct well within the time periods outlined in the October 7,
1998 Agreement. Naveed Qureshi could certainly have endorsed the check over to Neu
Direct in his capacity as president of Currency Direct, Inc., as evidenced by the check
being in Neu Direct's possession.
We certainly would be willing to resume paying Neu Direct directly provided we have the
the written consent of the officers of Currency Direct, Inc. since one (1) of them expressed
concern regarding the paying of Neu Direct directly. Upon receipt of this authorization,
we will forward a check to Neu Direct.
Sincerely,
Kenneth Augustine
Research and Development Manager
cc: Mike Carlone
Naveed Qureshi
Hans Leyer
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CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
ORDER
AND NOW, this ? of July, 1999, upon consideration of the
verified Petition for Interim Relief Pending Consideration of
Petition for Relief Under Pa. R.C.P. No. 1529(c), filed by
Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), which
concerns the Order of this Court dated June 28, 1999, granting
certain injunctive relief to and in favor of Plaintiff/Petitioner
and against Defendants Currency Direct, Inc. ("CDI"), Defendant
Neu-Direct, Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant
Nikos Valavanis, it hereby is ORDERED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis are directed to show cause before the Court on the
/ day of July, 1999, at "/r /9 m. E.D.T., in Courtroom
No. _5' , Cumberland County Courthouse, Carlisle, Pennsylvania,
why an order should not be entered and granting the relief
requested by Plaintiff/Petitioner's Petition for Relief Under
Pa. R.C.P. No. 1529(c), filed July 6, 1999.
2. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi, and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, in instantly useable format, to
CPS/MEMO at 1029 Mumma Road, Wormleysburg, Pennsylvania, at or
before noontime E.D.T. on July 9, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, in
instantly useable format, to CPS/MEMO at 1029 Mumma Road,
Wormleysburg, Pennsylvania, at or before noontime E.D.T. on July
9, 1999;
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
at 1029 Mumma Road, Wormleysburg, Pennsylvania, at or before
noontime E.D.T. on July 9, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and
keep same in operation through 11:59 p.m. E.D.T. on July 18,
1999.
i
Jordan D. L nningham, enquire
For the Plaintiffo
M0M8\TLP\0RDRR9\MRM0-R8L.IeP
2
FILED-,"FlCE
OF THr rnlTWCNOIARY
99 JUL -8 POI !. 36
CUMBER"ND (AUNTY
PENNSYLVANIA
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
PETITION FOR INTERIM RELIEF PENDING CONSIDERATION OF
PETITION FOR RELIEF UNDER Pa. R.C.P. NO. 1529(c)
NOW COMES the Plaintiff/Petitioner, Consumer Payment
Services, a division of Merchants Express Money Order Company,
("CPS/MEMO"), by and through its attorneys, Cunningham &
Chernicoff, P.C., and as its Petition for Interim Relief Pending
Consideration of Petition for Relief Under Pa. R.C.P. No.
1529(c), states as follows:
1. On July 6, 1999, Plaintiff/Petitioner CPS/MEMO filed
its Petition for Relief Under Pa. R.C.P. No. 1529(c) (the "Main
Petition"), which is herein incorporated by reference.
2. As averred in the Main Petition, Defendant Currency
Direct, Inc. ("CDI"), Defendant Neu-Direct, Inc. ("NDI"),
Defendant Naveed Qureshi, and Defendant Nikos Valavanis, have
failed to comply with, and have violated, the Order of Court
dated June 28, 1999, which provided certain injunctive relief in
favor of Plaintiff/Petitioner CPS/MEMO and against each of the
four said Defendants. Said violations will impose substantial,
irreparable harm on CPS/MEMO and its consumer customers if not
promptly halted.
3. It is believed and averred that this Honorable Court
plans to conduct a hearing on the Main Petition during the week
of July 12, 1999.
4. Petitioner/Plaintiff CPS/MEMO has no adequate remedy at
law to redress the current and continuing harm from the
violations of the said Order of Court; and it is appropriate and
just that this Honorable Court order certain performance by
Defendants, and grant limited relief, pending the said hearing.
WHEREFORE, Plaintiff/Petitioner prays that this Honorable
Court:
A. Issue a Rule to Show Cause addressed to the four
said Defendants CDI, NDI, Naveed Qureshi, and Nikos Valavanis,
directing them to show cause why the Main Petition might not be
granted; and
2
B. In said Rule to Show Cause order limited steps to
cure or stem alleged violations of the order of Court, in the
proposed format accompanying this filing; and
C. Grant such other and further relief as is just and
appropriate.
Respectfully submitted,
CUNNINGHAM & CHERNICOFF, P.C.
r
By: /
Jordan D. Cunningham, Esqu' e
Attorney Id. No. 23144
Marc W. Witzig, Esquire
Attorney Id. No. 29929
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
(717) 238-6570
Attorneys for
Plaintiff/Petitioner
Date: July 7, 1999
3
VERIFICATION
I, Ken Augustine, Research and Development Manager of
Merchants Express Money Order Company, verify that the statements
made in the foregoing Petition for Interim Relief Pending
Consideration of Petition for Relief Under Pa. R.C.P. No.
1529(c), are true and correct to the best of my knowledge,
information, and belief. I understand that false statements
herein are made subject to the penalties of 18 Pa. C.S.A. §4904,
relating to unsworn falsification to authorities.
k.p-l.'Zj?
Ken A Stine
Date: /'1A /`?y
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
CERTIFICATE OF SERVICE
I, Charlene K. Miller, a legal secretary for the law firm of
Cunningham & Chernicoff, P.C., hereby certify that on this 7th
day of July, 1999, a true and correct copy of the foregoing
Petition for Interim Relief Pending Consideration of Petition for
Relief Under Pa. R.C.P. No. 1529(c) was served by first-class
mail, postage prepaid, to the persons named on the attached
service list.
CUNNIN?G,H,AM& CHEIR/NICOyFFn,nF.C.
By : _? 1 l4) J lk1LE- Tl . IAkSLA11-
Charlene K. Miller
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
Current Direct, Inc.
10050 Roosevelt Boulevard
Philadelphia, PA 19114
Neu-Direct, Inc.
8121 Old York Road
Suite 200
Elkins Park, PA 19027-1424
Mr. Naveed Qureshi
531 E. Clarkson Avenue
Philadelphia, PA 19120
Mr. Nikos Valavanis
225 South Parkway Building
Broomal, PA 19008
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CUNNINGHAM & CHERNICOFF, P.C.
. ^.
? 1
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
CERTIFICATE OF SERVICE
I, Charlene K. Miller, a legal secretary for the law firm of
Cunningham & Chernicoff, P.C., hereby certify that on this 6th day
of July, 1999, a true and correct copy of that certain Petition for
Relief Under Pa. R.C.P. No. 1529(c), filed with the Prothonotary on
July 6, 1999, and proposed Order was served by first-class mail,
postage prepaid, to the persons named on the attached service list.
CUNNINGHAM & CHERNICOFF, P.C.
By: ^i \ C (_ 411(1 _ 71 ?X k?,
Charlene K. Miller
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
it
Current Direct, Inc.
10050 Roosevelt Boulevard
Philadelphia, PA 19114
Neu-Direct, Inc.
8121 Old York Road
Suite 200
Elkins Park, PA 19027-1424
Mr. Naveed Qureshi
531 E. Clarkson Avenue
Philadelphia, PA 19120
Mr. Nikos Valavanis
225 South Parkway Building
Broomal, PA 19008
>- s
N
LL?7 S V
ELI. _ ??
a
11
If -
CONSUMER PAYMENT
SERVICES, A Division of
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 99-,?e"10 IN EQUITY
NOTICE
TO DEFENDANTS NAMED HEREIN:
You have been sued in Court. If you wish to defend
against the claims set forth in the following pages, you must
take action within twenty (20) days after this Complaint and
Notice are served, by entering a written appearance personally
or by attorney and filing in writing with the Court your
defenses or objections to the claims set forth against you.
You are warned that if you fail to do so, the case may proceed
without you, and a judgment may be entered against you by the
Court without further notice for any money claimed in the
complaint or for any other claim or relief requested by the
plaintiff. You may lose money or property or other rights
important to you.
YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF
YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR
TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN
GET LEGAL HELP.
Cumberland County Bar Association
2 Liberty Avenue
Carlisle, PA 17013
Telephone: (717) 249-3166
I
NOTICIA
Le han demandado a usted en la corte. Si usted quiere
defenderse de estas demandas expuestas en las paginas
siguientes, usted tiene viente (20) dias de plazo al partir
de la fecha de la demanda y la notificacion. Usted debe
presentar una apariencia escrita o en persona o por abogado y
archivar en la corte en forma escrita sus defensas o sus
objeciones a las demandas en contra de su persona. Sea
avisado que si usted no se defiende, la corte tomara medidas
y puede entrar una Orden contra usted sin provio aviso o
notification y por cualquier queja o alivio que es pedido en
la petition de demanda. Usted puede perder dinero o sus
propiedades o otros derechos importantes para usted.
LLEVE ESTA DEMANDA A UN ABODAGO IMMEDIATAMENTE. SI NO
TIENE ABOGADO OSI NO TIENE EL DINERO SUFICIENTE DE PAGAR TAL
SERVICIO, VAYA EN PERSONA OLLAME POR TELEFONO A LA OFICINA
CUYA DIRECCION SE ENCUENTRA ESCRITA ABAJOPARA AVERIGUAR DONDE
SE PUEDE CONSEGUIR ASISTENCIA LEGAL.
Cumberland County Bar Association
2 Liberty Avenue
Carlisle, PA 17013
Telephone: (717) 249-3166
Respectfuxly subm;.tted,
P. C.
Date: Glzs?Ss gY
II.D. V3144
Marc witzig, Esquire
I.D. #29929
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
Telephone: (717) 238-6570
(Attorneys for Plaintiffs)
2
CONSUMER PAYMENT IN THE COURT OF COMMON PLEAS
SERVICES, A Division of CUMBERLAND COUNTY, PENNSYLVANIA
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
NO. 7q- 3y?o ?'?A -7'
IN EQUITY
COMPLAINT
NOW COMES your Plaintiff, Consumer Payment Services, a
division of merchants Express Money Order company, by and
through its attorneys, Cunningham & Chernicoff, P.C., who file
this action in equity and in support thereof, avers the
following:
1. Plaintiff, Consumer Payments Services is a division
of Merchants Express Money Order Company (hereinafter referred
to as "CPS/MEMO"), a Pennsylvania corporation, with a
principal place of business at 1029 Mumma Road, Wormleysburg,
Cumberland County, Pennsylvania. Plaintiff, CPS/MEMO'S, f,
r
t
business includes, but is not limited to, selling money orders
and the collection from customers and payment of public
utility payments.
2. Defendant, Currency Direct, Inc. (hereinafter
referred to as "CDI"), is a Pennsylvania corporation with a
place of business at 10050 Roosevelt Boulevard, Philadelphia,
Philadelphia County, Pennsylvania.
3. Defendant, Neu Direct, Inc., (hereinafter referred
to as "NDI") is a Pennsylvania corporation with a place of
business at 1821 Old York Road, Elkins Park, Montgomery
County, Pennsylvania.
4. Defendant, Naveed Qureshi, is an adult individual
who conducts business at 1821 Old York Road, Elkins Park,
Montgomery County, Pennsylvania.
5. Defendant, Nikos Valvanis, is an adult individual
who conducts business at 1821 Old York Road, Elkins Park,
Montgomery County, Pennsylvania.
I
6. Defendant, Naveed Qureshi, is the President of
Defendant, CDI, and, to the Plaintiff's belief, is an officer
of Defendant, NDI,
7. Defendant, Nikos Valvanis, is believed and therefore
averred he is an agent or principal Defendant of NDI and acts
in concert with Defendant, CDI.
8. Plaintiff possesses a license from the Pennsylvania
Department of Banking known as a money transmitter license.
9. On October 7, 1998, Plaintiff and Defendant, CDI,
entered into an agreement entitled "Agreement to Establish
'Bill Payment Services 111 (the "Agreement"). A true and
correct copy of the Agreement is attached hereto, made part
hereof, and is incorporated herein by reference and marked
Exhibit "P-111.
10. The purpose of the Agreement was to establish an
independent contractor agreement between CPS/MEMO and CDI to
permit customers of CPS/MEMO to pay utility and other select
s
types of invoices at various agent locations, and to establish z
a procedure for the profit of the parties whereby agents can
3
make payments of bills to vendors, via computer
softwaredeveloped and owned by CDI. The specific obligations
of the parties are that CPS/MEMO is to use its best efforts to
market and distribute, support and promote the business
objectives of the Agreement. CDI, on the other hand, is to
make available for the "exclusive use" by CPS/MEMO a "Bill
Payment System" software program, including data processing
services to effect the business objections. (See Exhibit ,P-
1", ¶5C)
11. Defendant, NDI, whose President, Naveed Qureshi, is
also President of Defendant, CDI, provided processing,
administrative support services and hardware for the "Bill
Payment System" software program to Defendant, CDI.
12. Under the terms of the Agreement, CDI agreed to
provide the "Bill Payment System" in a fully operational stage
and to maintain, develop, improve and innovate the system to
meet continual operational, regulatory or competitive demands
of the business. The "Bill Payment System" was to be fully
operational by CPS prior to system "roll-out". (See Exhibit
"P-111, 15C) In the Agreement, CDI warranted that it had the
legal right to grant to CPS/MEMO the exclusive use of the
4
r
"Bill Pament System" and that the license did not infringe
upon any third party's property or personal rights. (See
Exhibit "P-111, 15D(1))
13. Plaintiff, CPS/MEMO, and CDI were to receive fees
and reimbursements generated by the business on a monthly
basis.
14. The parties, in Paragraph 9 of the Agreement,
contemplated that there would be immediate and irreparable
damage resulting to one party, such as CPS/MEMO, if the other
party breached certain terms and conditions of Section 9.
Specifically, Paragraph 9 of the Agreement provides in
pertinent part as follows:
9. The Parties agree during the term of this
Agreement including any renewals, and for a period of one
(1) year following the termination of this Agreement,
neither Party shall conduct or operate any business in
direct or indirect competition with CPS unless
specifically agreed to in writing by both parties. This
restriction shall not prohibit any Party from pursuing
any other business venture which does not compete with
CPS. [T] his restriction shall prevent the officers
of either Party from the following activities: (a) .
(b) Requesting any customers of any business then
being conducted by CPS to curtail or cancel their
business with CPS; (c) Disclosing to any person, firm or
corporation any trade secrets, any details of
organization or business affairs of CPS, MEMO and/or CDI,
as well as any names of past or present customers of any
5
... .... ... '..ACV.
,
of them, or any other information relating to business
operations of CPS, from time to time certain non-
proprietary information regarding CPS may be used to
further marketing efforts. Due diligence shall be
exercised by either Party while discussing CPS operations
with third parties; . . . (e) Acting or conducting itself
in a manner which may reasonably be believed to be
harmful or contrary to the best interests of CPS. . ..
15. CPS/MEMO is of the belief and therefore avers that
Defendants, Naveed Qureshi, Nikos Valvanis, NDI and CDI, have
attempted to solicit business from third parties as a
processor of bill payments utilizing the "Bill Payment System"
software in competition with the services offered by CPS/MEMO.
16. CPS/MEMO has received information, and therefore
believes and avers, that Naveed Qureshi, President of CDI, and
acting in his capacity as President of Defendant, CDI,
traveled during May, 1999 to Minneapolis, Minnesota, where he
represented to one or more entities that NDI owns, has full
rights regarding, and is not restricted as regards, any use or
licensing of the "Bill Payment System" software program
licensed by CDI to CPS/MEMO under Section 5(c) of the
Agreement. This is in direct violation of Paragraph 9(e) of
the Agreement in that the marketing of the "Bill Payment
System" is the exclusive function of CPS/MEMO under the
6
r
Agreement and in that Defendant, CDI, had warranted it had the
legal right to grant to CPS the exclusive use of the "Bill
Payment System" software program.
17. Plaintiff, CPS/MEMO, moreover, is of the belief and
therefore avers that Defendants, Naveed Qureshi, Nikos
Valvanis, and CDI violated a number of the provisions of the
Agreement in that the "Bill Payment System" software has never
been fully operational and does not approach acceptable levels
of performance; and that Defendant, CDI's processor,
Defendant, NDI, has submitted invoices asserting out-of-pocket
expenses for reimbursement that otherwise should have been
made by CDI.
18. On May 20, 1999, Plaintiff, CPS/MEMO, paid the
monthly obligation owed for April, 1999 under the Agreement to
Defendant, CDI.
19. Defendant, Naveed Qureshi caused Defendant CDI to
refuse to negotiate the April, 1999 check.
xY
"i
?11
7
20. Defendant, NDI, on May 28, 1999, intercepted and
voided the check issued by Plaintiff, CPS/MEMO, to Defendant,
CDI, and demanded direct payment of the April, 1999 obligation
to Defendant, NDI.
21. Initially, Plaintiff, CPS/MEMO, refused the demand
of Defendant, NDI, to pay the 'April, 1999 obligation to
Defendant, NDI.
22. Between May 28, 1999 and June 13, 1999, several
discussions regarding the issue of payment of the April and
May, 1999 obligations were held between Plaintiff, CPS/MEMO,
and Defendants, Naveed Qureshi and Nikos Valvanis.
23. On June 14, 1999, and without notice, Defendant,
NDI, and its officers or agents, Defendants, Naveed Qureshi
and Nikos Valvanis changed the password to the customer
service module of the "Bill Payment System" software, in
effect shutting down CPS/MEMO operations.
8
24. As the result of said change to the password to the
software, various vendors' bills and utility bills would not
have been paid or honored, thus subjecting utility customers
to potential shut-off.
25. On June 14, 1999, Defendant, Nikos Valvanis, an
officer of Defendant, NDI, and President of Defendant, CDI,
declared to employees of MEMO that unless monies were directly
wired to NDI for payment of services, instead of to Defendant,
CDI, that the password to the customer service module of the
"Bill Payment System" software would be changed, thus placing
Plaintiff's operations out of business.
26. On June 14, 1999, Plaintiffs, CPS/MEMO, in reaction
to the demand of the Defendants, Naveed Qureshi, Nikos
Valvanis, and NDI, wire transferred the April and May, 1999
obligation owed to Defendant, CDI, to the account of
Defendant, NDI.
27. On June 14, 1999, Defendant, NDI, restored the
operation of the "Bill Payment System" software upon
confirmation of the receipt of funds.
9
28. Defendant, NDI, and their agents, Defendants,
Naveed Qureshi and Nikos Valvanis have threatened that if
Plaintiff, CPS/MEMO refuses going forward to pay the monthly
obligation owed to Defendant, CDI, to Defendant, NDI, they
again will change the password to the customer service module
of the Bill Payment Services software, thus effectively
placing Plaintiff, CPS/MEMO out of business.
WHEREFORE, Plaintiff respectfully requests this Honorable
Court to enter the following Order:
(a) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from marketing, selling, contracting or
entering into any partnership or joint venture with any third
party with regard to the "Bill Payment System" software
exclusively licensed by CDI to Plaintiff;
(b) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from marketing, selling, contracting or
entering any business in competition with the business being
conducted by CPS/MEMO;
10
(c) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from disclosing to any person, firm or
corporation and trade secrets, any details or organization or
business affairs of CPS/MEMO, as well as any names of past or
present customers of any of them, or any other information
relating to the business operations of CPS/MEMO;
(d) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from changing the password to the
customer service module of the "Bill Payments System"
software, or, in any way, putting into place a security system
which will disable or impede the Plaintiff from using the
"Bill Payment System" software envisioned by the Agreement of
October 7, 1998 until all of the remedies of the Agreement
have been initiated, resolved and reached resolution;
(e) CDI is directed to cause its attorney Geoffrey
Gomper to deliver to CPS/MEMO all materials, programs, and
code he holds under Agreement Section 35; and
11
(f) Such other relief as the Court may deem fair
and just.
Respectfully submitted,
P. C.
Date : 4 17 3 ?`17 BY? ?/
J an D Cunningham, Esquire
. #2 144
ar
c c W. Witzig, Esquire
I.D. #29929
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
Telephone: (717) 238-6570
(Attorneys for Plaintiffs)
bl\docn\complain\c......z
12
JUN.23.19991 1:00PM
MEMO MONEY ORDER CO.
nri a ?MERN1COFF
VRIFICATIOV
NO. 716 P.3
717 238 4809 P.e2,,M
I, Tanya Butler, vice President of Merchants 8xpress money
Order Company verify that the statements made in the foregoing
rrComplaint are true and correct to the best of my knowledge,
information, and belief. I understand that false statements
-herein are made subject to the penalties of 18 Pa. C.S.A. 54904,
relating to unsworn falsification to authorities.
Tanya Su her, vice President
Date: 6 0?3 9
BSH IB IT ¦P-1¦
AGREEMENT TO ESTABLISH "BILL PAYMENT SERVICE"
RECITALS
THIS Agreement made this 7YA day offci-4u, 1998, by and between
CONSUMER PAYMENTS SERVICES, a division of MERCHANTS EXPRESS
MONEYORDER COMPANY, a Pennsylvania Corporation with a place of business at
1029 Mumma Road, Wormleysburg, PA 17043 (hereinafter "MEMO") and
CURRENCY DIRECT, INC. ("CDI" ), a Pennsylvania Corporation, with a place of
business at 10050 Roosevelt Blvd., Philadelphia, PA 19114.
WITNESSETH
WHEREAS, a substantial and growing market exists for "Bill Payment Services"
to be provided to consumers through agent locations; and
WHEREAS, CPS, through a division of MEMO to operate with the trade name,
"Consumer Payment Services: (hereinafter, "CPS"), desires to enter this Agreement
(hereinafter "Agreement") with CDI for the provision of those services; and
WHEREAS, CDI desires to enter into this Agreement with CPS, for the provision
of those services; and
WHEREAS, CPS has the necessary expertise, the necessary licenses, a substantial
agent base, and marketing staff; and
WHEREAS, CDI has the appropriate computer knowledge, software applications,
networking capabilities and communications expertise.
NOW, THEREFORE, the Parties, intending to be legally bound, agree to enter
into the Agreement under the following terms and conditions.
AGREEMENT
1. The purpose of this Agreement is to establish an independent contracting
agreement between the Parties to permit consumers to pay utility and other select types of
invoices (hereinafter "Bills") at various agent locations (hereinafter "Agent'), and to
establish a procedure for the profit of the Parties whereby agents can make Bill Payments
to vendors via computer software developed and owned by CDI.
2. CPS and CDI acknowledge that the Bill Payment System ("System") software
developed by CDI to implement a Bill Payments Service, may require further
clarifications and modifications as the procedures and regulations applicable to Bill
Payments and Electronic Payments ("El's") are developed or changed. To that end, CPS
and CDI shall cooperate with each other in good faith, each use its best efforts, and shall
Agreement to establish "BILL PAYMENT SERVICE" Page 1 of 14
generally share, subject to the confidentiality requirements imposed under this
Agreement, any information that reasonably may be required by the other Party, with the
goal of ensuring the successful development and implementation of the Bill Payment
Services Program.
3. MEMO agrees to establish a separate operating division known as Consumer
Payment Services (hereinafter "CPS"), a division of Merchants Express Money Order
Company, a Pennsylvania Corporation." MEMO will set up separate books and records
for said division, and will keep all activities of this division separate and apart from its
other business operations. MEMO will file the appropriate fictitious name certificate
applications for CPS. CPS will not have any full or part-time employees unless agreed to
by the Parties, but rather its activities will be conducted either on a contract basis, or on
the basis where PFMA, CDI, Westside Check Cashing Inc. or Neu Direct employees will
perform services for CPS, subject to the approval of the Governing Committee (as
hereinafter defined), and shall be reimbursed for said services by CPS.
4. The Parties acknowledge that, in certain states in which MEMO operates,
MEMO is licensed through one or more subsidiaries, currently MEMO Money Order
Company and MEMO - New York. At such time as the business expands into these
states, MEMO will cause its subsidiary(s) to form a division, "Consumer Payment
Services", and this division will operate the bill payment service in the same manner as
CPS operates as a division of Merchants Express Money Order Company. Financial
Reports for all CPS divisions will be combined. Both Parties acknowledge that the name
Consumer Payment Services" may not be clear in all states, and the service may operate
subject to the conditions of this contract under an agreed upon alternate name in those
states.
5: Subject to the terms and conditions set forth below, in connection with the Bill
Payment Services Program, CDI and CPS shall at all times during the Initial Term and
any Subsequent Term of this Agreement provide, render and perform the services
necessary to implement and operate the Bill Payment Services Program. Specifically, the
Parties shall provide services to CPS as specified below:
A. CPS and CDI agree that CPS shall supervise and direct the day to day
management and operation of CPS's ordinary and usual business affairs, subject to the
instructions, guidance, and directions of a "Governing Committee which shall at all times
be composed of two members selected by CDI and two members selected by MEMO.
B. MEMO agrees to use its best efforts to market and distribute on behalf
of CPS and to do all things reasonable to fully promote and support CPS and its business
objectives.
C. CDI agrees to make available for the exclusive use by CPS in its
business operations a certain "Bill Payment Services" software program including certain
data processing services. The attributes of the System, as currently developed, are
Agreement to establish "BILL PAYMENT SERVICE" Page 2 of 14
defined in Appendix A hereto. It is understood and agreed by the Parties that CPS shall
compensate CDI for enhancements to the System later developed in accordance with
expense reimbursement procedures outlined in 8A. These enhancements shall be over
and above the fully operational system as reported by CDI prior to system rollout
D. CDI will provide the System at a fully operational stage, as defined by
the governing committee. (See Appendix A for Current Operational Stage). CDI agrees
to maintain, develop, improve, and/or innovate the System to meet the continual
operational, regulatory, or competitive demands of the business. The cost of such
maintenance, development, improvement and/or innovation will be funded by CPS out of
CPS fees under expense reimbursement guidelines outlined in 8A. In the event that the
Governing Committee by majority vote declares that CDI cannot timely or cost
effectively complete such maintenance, development, improvement and/or innovation, or
any part thereof, CPS and/or MEMO will have the full authority to contract with and/or
employ vendors/staff necessary to perform the functions.
1.. CDI warrants that it has the legal right to grant to CPS the exclusive
use as set out in Paragraph 5(C) of this Agreement and that such license does not infringe
upon any third Party's property or personal rights.
2. CDI wan-ants there are no lawsuits pending or threatened concerning
CDI's rights to license and use the System, and that the System has not been published in
such a way as to lose any of its copyright or Patent protections.
3. CDI will have a qualified Patent/Copyright Attorney review all
components of the System, including software to the best of the Patent/Copyright
Attorneys opinion and after a diligent search render a written opinion that the System,
including software does not infringe upon any patent, copyright, trade secret, or other
property rights of a third Party. Further, this attorney should also render an opinion of
whether CDI would be reasonably advised to Patent or apply for Copyright protection.
4. CPS agrees to provide marketing, licenses, customer service,
management, general accounting services, record keeping and reporting services as may
be required and shall receive payment in accordance with Paragraph 8A. CPS, shall
collect monies from the agents, hold receipts and shall make appropriate disbursements
for Bills at such times as required. The Parties acknowledge that MEMO and its
subsidiaries and divisions are subject to accounting and reporting rules under GAAP,
state banking regulations, etc., and that these rules require strict adherence to certain
accounting and reporting standards in the conduct of its business. The Parties agree that
accounting and reporting for CPS will conform to any and all accounting, reporting, etc.,
standards which otherwise apply to MEMO. CDI will make all software changes
necessary for CPS to efficiently and accurately provide these services, and shall receive
payment in accordance with Paragraph 8A.
Agreement to establish "BILL PAYMENT SERVICE" Page 3 of 14
5. MEMO agrees to maintain separate books and records for CPS and to
conduct CPS at all times as a separate division of MEMO. MEMO shall keep accurate,
full, and complete books and accounts showing the assets, liabilities, operations,
transactions, and financial condition of CPS. Such books and records shall be kept at
MEMO's principal office and/or at a suitable off-site storage area. CPS shall operate on a
fiscal year ending June 30. Monthly financial statements for CPS shall be prepared by
MEMO and provided to all Parties. On or before September 15 of each year, CPS shall
provide to the Parties annual financial statements.
6. Unless otherwise agreed to by all Parties, both Parties shall provide at no cost
to CPS general consulting services from time to time as the need arises. Each Party will
have various computer hardware at its location in order to provide services for CPS. This
equipment must not be encumbered in anyway or used as collateral for any other business
venture of either Party or affiliated companies.
7. MEMO or CPS with the majority approval of the Governing Board, may hire,
fire, promote, demote employees or contract with other providers of services as
necessary. Costs will be paid subject to Expense Reimbursement Guidelines.
8. The Parties shall receive fees and expense reimbursements as follows:
A. Each Party shall be reimbursed for reasonable and necessary expenses
as approved by the Governing Committee and reimbursement shall generally occur on or
about the 20th day of each month provided all invoices are submitted to CPS no later than
the 5th of each month. Each Party will provide vendor invoices for all out pocket
expenses to be reimbursed. In the event that there is insufficient revenue to cover these
expenses, the Parties will be reimbursed as much as possible.
B. Each Parry shall receive a fee of five cents ($.05) per transaction for its
contribution to CPS, provided that sufficient revenue was generated to cover this
distribution. This fee shall be paid monthly at the same time as expense reimbursement.
In the event that there is insufficient revenue to fund these fees, there will be either a pro
rata distribution or no distribution.
C. Additional fees may, with majority approval of Governing Board, be
paid to each Party as independent contractors for consulting services as specified above
under this Agreement. Such additional payments (hereinafter "Commission
Compensation") shall be paid quarterly (as of the end of March, June, September, and
December) on or before the 20th of the month next following the month in which each
calendar quarter ends. Commission Compensation shall be determined on an accrual
basis by taking into account the net income of the operations of CPS, which shall mean
actual gross revenues less reimbursements, operating expenses and bad debt accruals of
CPS, and shall equal Fifty Percent to each Parry of the income of the operations of CPS.
Additionally„ if the Governing Committee agrees to operating losses as defined by
Agreement to establish "BILL PAYMENT SERVICE" Page 4 of 14
distributed financial statements, each Party shall reimburse CPS Fifty Percent (50%) of
such losses within twenty (20) days of being notified.
D. No later than July 1, 2000, the revenue sharing will be converted from
a profit sharing to a per item fee for each party. Profits and costs of each parry will be
analyzed with the end result being that each party will net the same profit per item as they
would have under the initial revenue sharing agreement.
9. The Parties agree that during the term of this agreement including any
renewals, and, for a period of one (1) year following the termination of this Agreement,
neither Party shall conduct or operate any business in direct or indirect competition with
CPS unless specifically agreed to in writing by both Parties, except as stated in Paragraph
14. This restriction shall not prohibit any Parry from pursing any other business venture
which does not compete with CPS. This does not prohibit either Party from continuing
the business in the case of a default cited in Paragraph 14. However, this restriction shall
prevent the officers of either Party from the following activities:
A; Engaging as an officer, employee, partner, employee shareholder, or
any other capacity, in any business in competition with any business then being
conducted by CPS at the time this Agreement is signed;
,B. Requesting any customers of any business then being conducted by
CPS to curtail or cancel their business with CPS;
C. Disclosing to any person, firm or corporation any trade secrets, any
details of organization or business affairs of CPS, MEMO and/or CDI, as well as any
names of past or present customers of any of them, or any other information relating to
the business operations of CPS, from time to time certain non-proprietary information
regarding CPS may be used to further marketing efforts. Due diligence shall be exercised
by either Party while discussing CPS Operations with third Parties;
D. Inducing, or attempting to influence, any employee of CPS to
ternninate employment with the CPS or to enter into any employment or other business
relationship with any other person, firm or corporation.
c. Acting or conducting itself in any manner which may reasonably be
believed to be harmful or contrary to the best interests of CPS.
The Parties recognize that immediate and irreparable damage will result to CPS if .
either breaches any of the terms and conditions of this Section and, accordingly, each
hereby consents to the entry by any Court of competent jurisdiction of an injunction
against itself to restrain any such breach, in addition to any other remedies or claims for
money damages which the CPS may seek.
Agreement to establish "BILL PAYMENT SERVICE" Page 5 of 14
10. The Agreement shall not be deemed to create a partnership orjoint venture
among the Parties. The relationship is defined and understood as a contract among
independent contractors, and no action shall be deemed to bind other Parties except to the
extent, if any, as defined in this Agreement. At no time during this Agreement will CDI
acquire any capital, equity, profits or other interest in any entity owned by or affiliated
with Pennsylvania Food Merchants Association, the parent of MEMO, or MEMO itself.
11. The initial Term of the Agreement shall be Fifteen (15) years unless sooner
terminated by the Default (as defined below) of either Party. The Agreement shall
automatically renew for successive five (5) year periods following the end of the initial
term unless one hundred eighty (180) days written notice is provided by the Parry
desiring termination. In the event of termination, the Party not initiating the termination
shall have a right of first refusal to continue to operate the business under the CPS' name
and shall have access to software (including source code) or agent information as the case
may be. The Parry continuing the business shall compensate the other Party for the
provision of agents or software, as the case may be, at a value to be determined by an
independent appraisal. Each Parry will pick an appraiser, and these two (2) appraisers
will pick a third appraiser who will conduct an independent appraisal to determine the
value,of CPS. The Party continuing CPS's service(s) will compensate the other Party
fifty (50) percent of the value in equal monthly payments over a period not to exceed a
twenty four (24) month period. The payments will be restricted to the actual value of the
service with no interest. The terminating Parry shall be prohibited from providing agent
information or software or information about the nature, structure, or operation of the
business, as the case may be, to any person and/or entity for the time period in which the
Party continuing the business does actually continue the business. In the interest of not
losing existing agent base (if CDI were to continue business) CDI must make provisions
to convert agents within one hundred eighty (180) days of CPS' default. All Parties
acknowledge that all Money Transmitter Licenses owned by MEMO or its subsidiaries
cannot be transferred, assigned or sold to CDI or any other entity under any circumstance.
In the event that either Westside Check Cashing, Inc.'s Majority Stockholder (Mike
Carlone) or Neu Direct's Majority Stockholder (Naveed Qureshi) are no longer affiliated
with CDI, MEMO will have the right to approve or disapprove any nominations to the
Governing Committee by CDI.
12. This Agreement may be terminated for cause ("Termination for Cause") by
either Party upon delivery of written notice of the intention to terminate and the cause for
such termination to the other Party not less than ?0 days after delivery of such notice
("Termination for Cause Date") unless the receiving Party cures prior to the Termination
for Cause Date. For purposes of this Paragraph "cause" shall mean illegal acts, willful
misconduct, actual fraud or the occurrence of other Events of Default as defined
hereinafter. Upon termination the grieving Party will assume operation of CPS, and shall
buy out defaulting Parry in accordance with terms in Paragraph 11.
Agreement to establish "BILL PAYMENT SERVICE" Page 6 of 14
13. Effect of Termination. Except to the extent otherwise provided in this
Agreement, upon termination of this Agreement, the obligations of the Parties shall cease.
14. Events of Default. An "Event of Default shall mean the occurrence or
existence of one or more of the following events or conditions (whatever the reason for
such Event of Default and whether voluntary, involuntary or effected by operation of
law):
(A) Either Parry fails to perform in a reasonably timely manner any material
obligation under this Agreement;
(B) Any representation or warranty made by either Party under this Agreement or
any financial statement, certificate, report, exhibit or document required to be furnished
pursuant to this Agreement shall prove to be materially false or intentionally misleading
in any material respect as of the time when made (including by omission of material
information necessary to make such representation, warranty or statement not
misleading);
(C) Either Parry shall default in the performance or observance of any covenant,
agreement or duty under this Agreement and such default shall have continued for a
period of 30 days after notice of such default;
(D) Any material adverse change in either Party's business, operations, condition
(financial or otherwise), properties, assets, or prospects shall occur;
(E) One or more judgments for the payment of money shall have been entered
against either Party, or principles of either Party which judgment or judgments shall have
remained undischarged, or unappealed, or unstayed for a period of 90 consecutive days
after notice of the same.
(F) A proceeding shall have been instituted in respect of either Parry (1) seeking
to have an Order for relief entered in respect to such Party, or seeking a declaration or
entailing a finding that such Party is insolvent or a similar declaration or finding, or
seeking dissolution, winding up, charter revocation or forfeiture, liquidation,
reorganization, arrangement, adjustment, composition or other similar relief with respect
to such Party, its assets or its debts under any law relating to bankruptcy, insolvency,
relief of debtors or protection of creditors, termination of legal entities or any other
similar law now or hereafter in effect, or (2) seeking appointment of a receiver, trustee,
custodian, liquidator, assignee, sequestrator or other similar official for such Party or for
all or any substantial part of its property; or
(G) Either Party shall become insolvent, shall become generally unable to pay its
debts as they become due, shall voluntarily suspend transaction of its business, shall
make a general assignment for the benefit of creditors, shall institute a proceeding
described in Paragraph 14(F) above, or shall consent to any order, declaration, or finding
Agreement to estahlish "BILL PAYMENT SERVICE" Page 7 of 14
for relief described therein, or shall consent to any such appointment or to the taking of
possession by any such official of all or any substantial part of its property, shall dissolve,
windup, revoke or forfeit its charter (or other constituent documents) or liquidate itself or
any substantial part of its property, or shall take any action in furtherance of any of the
foregoing.
15. If any Event of Default listed in the preceding section shall occur or continue
to exist, the non-defaulting Party may exercise one or more of the following remedies:
(A) Terminate this Agreement upon notice to the defaulting Party in accordance
with the preceding paragraphs of this Agreement, including, but not limited to Paragraph
11;
(B) Take such other action as may be permitted by applicable law.
(C) Continue to run CPS on a day to day basis so as not to place the service in
jeopardy to existing agents.
16. The Parties' remedies under this Agreement are non-exclusive and
cumulative; and each may be exercised separately, concurrently with any other remedy or
in any order or manner permitted under Applicable Laws, and without the need to exhaust
any other remedy provided hereunder. The provisions if this Paragraph 16 shall survive
termination of this Agreement, and shall continue indefinitely.
17. Any controversy or claim arising between the Parties and relating to the
Agreement, shall be resolved by binding arbitration. This Agreement to arbitrate shall
continue in full force and effect despite the expiration or termination of this Agreement.
All arbitrations shall be undertaken pursuant to the Rules of the American Arbitration
Association, and the decision of the arbitrators shall be final and enforceable in any court
of competent jurisdiction absent actual fraud. The Parties knowingly and voluntarily
waive their rights to have their dispute adjudicated by a judge or jury. The arbitrator shall
apply the law of the Commonwealth of Pennsylvania and the arbitration shall be held in
the defending Party's area (Philadelphia County for CDI; Dauphin County for CPS).
18. Any Party may demand arbitration by sending written notice to the other
Party. The arbitration and the selection of arbitrator(s) shall be conducted in accordance
with such rules as may be agreed upon by the Parties, or failing Agreement within thirty
(30) days after arbitration is demanded, under the commercial Arbitration Rules of the
American Arbitration Association ("AAA"), as such rules may be modified by this
Agreement. In any dispute which involves more than $100,000.00 in damages, three
arbitrators shall be used. Unless the Parties agree otherwise, they shall be limited in their
discovery to relevant documents. Responses or objection to a document request shall be
served within twenty (20) days after receipt of the request. The arbitrator(s) shall resolve
any discovery disputes. CPS must continue to operate in the interim.
Agreement to establish "BILL PAYMENT SERVICE" Page 8 of 14
19. The arbitrator(s) shall have the authority to award actual money damages
(with interest on the unpaid amounts from the due date), specific performance, and
temporary injunctive relief, but the arbitrator(s) shall not have the authority to award
exemplary, punitive, or consequential damages, and the Parties expressly waive any
claimed right to such damages. The costs of arbitration, but not the costs and expenses of
the Parties, shall be shared equally among the Parties. If a Party fails to proceed with
arbitration, unsuccessfully challenges the arbitration award, or fails to comply with the
arbitration award, the other Party is entitled to costs, including reasonable attorney's fees,
for having to compel arbitration or defend or enforce the award. Excent as otherwise
required by law, the Parties and the arbitrator(s) a gee to maintain as confidential all
information or documents obtained during the arbitration process including the
resolution of the dispute.
20. All notices required or permitted hereunder shall be in writing and shall be
served to the following address:
Consumer Payment Services
Merchants Express Moriey Order Company
1029 Mumma Road
Wormleysburg, PA 17043
Currency Direct, Inc.
10050 Roosevelt Blvd.
Philadelphia, PA 19114
21. In the event that any term or provision of the Agreement or any application
thereof to any person or circumstances shall be declared prohibited, invalid, or
unenforceable to any extent in any jurisdiction, as determined by a court of competent
jurisdiction, such term or provision shall, in that jurisdiction, be ineffective only to the
extent of such prohibition, invalidity, or unenforceability, or as applied to such persons or
circumstances, without invalidating or rendering unenforceable the remaining term or
provisions hereof or affecting the validity or enforceability of such tens or provision in
any other jurisdiction or as to other persons or circumstances in such jurisdiction.
22. This Agreement shall be governed exclusively by the laws of the
Commonwealth of Pennsylvania.
23. This Agreement contains all the agreements between the Parties regarding the
subject matter hereof and may not be modified orally or in any manner other than by
Agreement in writing signed by the majority of members of the Governing Committee.
24. This Agreement is intended solely for the benefit of the Parties hereto and no
covenant or the provision herein shall create any rights in, or give rise to any cause of
action by, any other person not a Party hereto.
Agreement to establish "BILL PAYMENT SERVICE" Page 9 of 14
25. This Agreement shall inure to the benefit of and be binding upon the Parties
and their respective legal representatives, successors, and permitted assigns.
26. No Parry may assign its rights or obligations hereunder without the prior
written consent of all other Parties.
27. The CPS name shall not be used by the Parties for any purpose other than
contemplated under this Agreement without the prior written consent of all other Parties.
28. Unless the context of this Agreement otherwise clearly requires, references to
the plural include the singular, the plural and the part, the whole; "or" has the inclusive
meaning represented by the phrase "and/or, and "property" includes all properties and
assets of any kind or nature, tangible or intangible, real, personal or mixed. References in
this Agreement to "determination" (and similar terms) include good faith estimates by the
Parties (in the case of quantitative determinations) and good faith beliefs by the Parties
(in the case of qualitative determinations). The words "hereof," "herein," "hereunder"
and similar terms in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement.' Section, subsection, exhibit and schedule
references are to this Agreement unless otherwise specified.
29. Each Party shall take such other actions as the other Party may reasonably
request to ensure that this Agreement is given full affect, including, but not limited to the
execution of such other documents and Agreements as may reasonably be necessary.
30. In addition to complying with this Agreement, CPS shall at all times comply
with any Federal, State, local or other law, rule, court order, court decision,
administrative decision, administrative order, regulation, statute, commentary, injunction
or other authority applicable to, and including without limitation the requirements of all
FEDERAL, STATE, and local governmental and regulatory or supervisory authorities
(collectively, "Governmental Authorities") having jurisdiction over (collectively,
"Aoolicable Laws").
31. (1) CPS shall provide the Parties, and each of their staff, internal and external
auditors, or other authorized agents or representatives with access to (1) such facilities,
information, data, files, records, policies and procedures which are part of or relate to the
Bill Payment Service Program, CPS's Services or CPS finances, including without
limitation audits performed by CPS's external auditors, if applicable, (collectively,
"Company Books and Records"), and (2) such employees, agents or representatives of
CPS that are responsible for providing or supervising the provision of the Company
Services or ensuring compliance with or supervising the compliance with the Company
Procedures ("Company Relevant Employees"), as may be reasonably necessary with
respect to the Bill Payment Services Program, CPS's Company Services or Procedures.
Such access shall be provided at CPS's offices upon reasonable prior notice.
Agreement to establish "BILL PAYMENT SERVICE" Page 10 of 14
32. The Parties each hereby represent, warrant and covenant to each other as
follows:
(A) Each is a Pennsylvania corporation, validly existing and in good standing
under the laws of the Commonwealth of Pennsylvania.
(B) Each has the power and authority to execute, deliver, perform, and take all
actions contemplated by this Agreement, and all such action has been duly and validly
authorized by all necessary proceedings on its part.
(C) This Agreement has been duly and validly executed and delivered by each
Party. This Agreement constitutes the legal, valid and binding obligation of each Parry,
enforceable against each in accordance with its terms.
(D) Each Party shall make reasonable efforts to maintain the overall quality of
CPS Services to be provided hereunder. The quality of all such Services shall be
consistent with the Procedures set forth herein.
(E) Each Party is familiar with all Applicable Laws that in any way govem this
Agreement or the Services. Each is in full compliance with all such Applicable Laws as
they apply to CPS Services or otherwise to CPS in connection with the Bill Payment
Services Program.
(F) Each Party has applied for and obtained all consents, licenses or other
approvals required by any Governmental Authorities for CPS to engage in the activities
contemplated by, and to perform its obligations under, this Agreement, including without
limitation Bill Payment Services.
(G) Neither the execution and delivery of this Agreement by either Party, nor
consummation by the Parties of the transactions herein contemplated, nor performance of
or compliance with the terms and conditions hereof by the Parties (including without
limitation providing, rendering and performing this Agreement) does or will:
(i) violate or conflict with any Applicable Law, or
(ii) violate, conflict with or result in a breach of any term or condition of,
or constitute a default under, or result in (or give rise to any right,
contingent or otherwise, of any person or entity to cause) any
termination, cancellation, prepayment or acceleration of
performance of, or result in the creation or imposition of (or give
rise to any obligation, contingent or otherwise, to create or impose)
any lien upon any property of the Company pursuant to, or otherwise
result in (or give rise to any right, contingent or otherwise, of any
person or entity to cause) any change in any right, power, privilege,
duty or obligation of either Party or in connection with,
Agreement to establish "BILL PAYMENT SERVICE" Page 11 of 14
(A) the charter or by-laws (or other constituent documents)
of either Party; or
(B) any agreement, indenture or instrument to which either
Parry is a Party or by which it or any of its properties
(now owned or hereafter acquired) may be subject
or bound.
33. All non-public information relating to the business of the Parties or the
Services provided hereunder or performance of this Agreement, including without
limitation this Agreement, which is submitted or disclosed by one Party to the other
during the negotiation, Initial Term or any Subsequent Term of this Agreement shall be
treated as confidential and safeguarded by the receiving Parry to the same extent that such
Parry safeguards its own confidential and proprietary data, and each Party will use
reasonable measures and will supervise its personnel so as to prevent the disclosure of
such confidential information to third persons or sue of such confidential information
except in connection with the Services provided under this Agreement provided.
however, that all Parties may disclose basic descriptions of the Services in connection
with the performance or marketing of the Parties' respective services. This Paragraph
shall not prevent or prohibit disclosure of any information required to be disclosed to any
Governmental Authorities pursuant to any Applicable Laws on or pursuant to lawful
subpoena or judicial order; provided, however, that before making such disclosure the
subject Parry shall tender to the other any opportunity, to be exercised at no cost or
expense to the tendering Party, and/or CPS to defend against such compulsory disclosure.
34. This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one
and the same instrument.
35. This Agreement is contingent upon MEMO's review and approval of all
organizational documents and shareholder/officer agreements of Currency Direct, Inc.
Further a copy of all existing documentation, procedures, source code, and object code
will be held at the law office of Geoffrey B. Gompers, and be updated no less often than
quarterly.
36. MEMO and CDI represent that each has in the past been represented by
CDI's attorney in a number of matters. CDI's attorney has made full disclosure of such
representations to each, and had advised both MEMO and CDI that such representations
has and does create a conflict of interest and that both Parties would be better advised to
retain their own independent counsel. Each Parry also understands that upon the
objection of either, CDI's counsel must and will withdraw from this representation. After
complete disclosure, and in the interest of saving time and in the interest of completing
this amicable Agreement, each has voluntarily and intelligently waived this conflict of
interest.
Agreement to establish "BILL PAYMENT SER MICE" Page 12 of 14
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
T7 TS ECOMPANY
reside CURRE CY DI T,
By: 4?,L4 7
Press ent
Agreement to establish "BILL PAYMENT SERVICE" Page 13 of 14
Addendum A - Agreement to Establish "Bill Payment Service"
REIMBURSABLE EXPENSES
Salaries/Benefits/Taxes Associated with Payroll
Phone Costs (dedicated line for CPS use only)
Advertising Materials
Employee Expenses (Travel/Auto for CPS only)
Bank Fees
Third Party Processing Fees
Computer Equipment (with approval of Governing Committee)
Licensing Fees (CPS only)
Bonding Fees
Accounting Fees (billing hourly for CPS)
Marketing Expenses
Supplies for Resale
Computers for Resale
Programming Costs for system enhancements once system is fully operational
Printing
Interest Expenses
State Registration Fees
Attorney Fees (CPS incurred charges only)
,.
Any other expense approved by majority vote of the Governing Committee
Agreement to establish "BILL PAYMENT SERVICE" Page 14 of 14
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CURRENCY DIRECT, INC.
President - Naveed Qureshi
Secretary/Tresurer - Michael Carlone
LDERS OF CURRENCY DIRECT, INC.
(A) Neu Direct, Inc. - Sot
(1) Naveed Qureshi, President
(2) Nikos valvanis
(B) Westside Check Cashing, Inc.- Sot
L(1) Michael Carlone - President
EXHIBIT
?12u1?a t,Fi-i
i
CONSUMER PAYMENT
SERVICES, A Division of
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
1
• r
NO. 99 - 3840 EQUITY
' J
IN EQUITY
AFFIDAVIT OF SERVICE
TO THE PROTHONOTARY:
Attached are the original Affidavits of Service upon all
above named Defendants. Service was effected in accordance
with Pa. R.C.P. No. 400(b).
Rest_ctfully submitted,
Date:June 28, 1999
l? PLAINTIFF'S
61287 bFt-}
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
Telephone: (717) 238-6570
(Attorneys for Plaintiff)
BRESLIN SPECIALIZED SERVICES
jr S ational
Association of
Professional
Process Servers P.O. Box 325
Upper Darby, PA 19082
734-1647
(610) Philadel hu
P
Association of
Professional
ProttnServess
AFFIDAVIT OF SERVICE
PLAINTIFF(S) COURT TERM a NO. COUNTY
Consumer Pay ment Services 99 - 3840 Eq. Cumberland
DEFENDANT(S) DATERECEIVED SERVERY
SERVE AT
8121 Old York Rd.
Elkins Park PA
O
O
Wril
Order of 6-24-99, Petition for
Preliminary Injunction, Subooei
Served and made known to Currency n; rent-.
on the 25 day of June 119 99 at 2:37 o'clock, P. M.,
at tnnsn RMGGVpI} ra1.,A County of Phi 1a.
Commonwealth of Pennsylvania, in the mannerdescribed below:
CI Delandant(3) personally served.
O Aduftfamlly memberwith whom said Defendant(s) reside(s). Relationship Is
O AWN In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clerk of place of lodging In which Defendant(s) reside(s).
O Agent or perace In charge of Defendant's office or usual place of business.
Other !42 Fialuclca Sonios V P anofl at said Defendant company.
O
DESCRIPTION AGE 35- 40 HEIGHT 61 1" WEKiHT 185 lbsRACE W SEX M OTHER
On the day of ,19 at c'da*, M.,
Defendant not found because: O Moved O Unknown O No Answer O Vacant O Other
NAME OF SERVER Swom b a sullsa" before me
day ul f%a 10
8eyd ArBres?#tt belnp duy sworn accoMlrp to law, deposes and
says that he/she is a process server heroin named and that the fact herein am forth P
L u lit'
above are true and correct to the boot of their
knowledge, informadon and belief. r< County
20Q1
Sheriff Process Server/ Competent Adult
DEPUT¢EDSERVICE
Now, this day of 19 . I do hereby deputize the Sheriff of County.
to serve this O Summons O Complaint O Othar and make return thereof and according to Law.
By (Competent Adult) County Sheriffs Check $
Law Firm-_Ctulninaham S Chernicoff
AttomeysName marr w_ wil•7.igeF?_For Plaintiff
Address 9v7n W Soennd Sic
Harrisburg PA 17106
Telephone# 717-238-6,;7n Identifications 229929
01990 Philadelphia Assoc. m Professional Process Servers Rev 1
ATTEST
PRO PROTHY
DATE
BRESLIN SPECIALIZED SERVICES
'??__= National P.O. Box 325
Association or
S Professional Uppcr Darby, PA 19082
Process Servers (610) 734-1647
PLAINTIFF(S)
Consumer
DEPENDANT(S)
Neu Direct, Inc
SERVE AT
8121 Old York Rd.
Elkins Park, PA
99 -
Summons p
Writ of XI
Philadelphia
Associ too of
Professional
Process; Serven
Real Estate
Pet}lion for Pr 1 minaryy? In]'unction,
Notice of Deposition, StlbpOena
SPECIAL
Served and made known to Neu Direct, Inc,
on the 25 day of June ,19 99 . at 4:00 o'clock. p, M.,
at 8121 Old York Rd. countyof Montgomery
Commonwealth of Pennsylvania, In the manner described below:
O Defendam(s)peroonapyserved.
O Adult family member with whom said Defendant(s) reside(s). Relationship Is
O Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clerk of place of lodging in which Defendant(s) reside(s).
O Agent or pone M charge of Defendants office or usual place of business.
N f a h' anofflcerofsaid Defendant company.
O after
DESCRIPTION AGE 30-35 HEIGHT 5'9" WER3HT 150 lbs RACE Hindu SEX M OTHER
On the day of
Defendant not found because: O Moved
AFFIDAVIT OF SERVICE
O Unknown
19_ . at o'ekzk,
M.,
O No Answer O Vacant Cl Other
NAME OF SERVER
Boyd A. Breslin Ing duly swum according to taw, deposes and
says that he/she Is e process server herein named and that the facts herein set forth
above are true and correct to the beet of their knowledge, information and belief.
Sheriff
Now, this day
to serve this O Summons O Complaint O Other
Process
19 . I do hereby deputize the Sheriff of
By (Competent Adult)
Law Finn f]tnninghasn F. rharnirnff
Attomey's Name Marc W. Wi ..ia..ca? For P1 a i ni i ff
Address_ 2320 N. Second
Harrisburg, PA 17106
Telephonee7t7_goA_rc;7n kemffcallone 29979
O1eeo Philadelphia Assoc. of Professional Proeees Servers Rev I
SuWtxbsd befell me
Not
UppP +ry ?ut{ic
?"•'?? ?
cr::.:cnr 24.2C I
County.
and make return thereof and according to Law.
County Sheriff's Check 5
ATTEST
PRO PROTHY
DATE
National
S Association of
Professional
Process Servers
PLAINTIFF(S)
Consumer Payment Services
Naveed Qureshi
SERVE AT
8121 Old York Rd.
Elkins Park, PA
99 - 3840
6-25-99
Philadelphia
Association of
Professional
Process Servers
Cumberland
asap
O Summons O N06 of Real Estate
a Writ of ?03 Mawr n-A--
Petttion for PeliminsrY Injunction,
Notice of Deposition, Subpoena
SPECIAL INSTRUCTIONS
Served and made known to "Tas'te'r rns-orb,'
on the 25 day of June -.19 99 at 4; 00 o'clock, P. M.,
at 8121 n1d Ynrrr a,a ,Countyof Montgomery
Commonwealth of Pennsylvania. In the mannardeseribed below:
X3 Defendant(s) personally served.
O Adult family member with whom said Defendant(s) reside(s). Relationship Is
O Adult In charge of Defendants rssidence who refused to give name or relationship.
O Manager/Clark of plow of lodging In which Defendant(s) reside(s).
0
0 Agent or person In charge of Defendant's office or usual piece of business.
an offlwrof said Defendant company.
O Other -
DESCRIPTION AGE 30-35 HEIGHT 5491, WEK3HT 150lbs. RACE Hindu SEX M OTHER
On the day of
Defendant not found because: O Moved O Unknown
NAME OF SERVER
119. at o'clock, M.,
O No Answer a Vacant
Boyd A. Breslin being duty sworn according to law, deposes and
says that he/she b a process server herein named and that the facts herein act forth
above are true and correct m the beet of their knowledge, information and belief.
Sheriff
AFFIDAVIT OF SERVICE
Process Server/ Competent
DEPUTIZED SERVICE
Now, this day of 19 . I do hereby deputize the Sheriff of
to serve this O Summons O Complaint O Other
By (Competent Adult)
Law Finn ir?,;EnOh?n b Che"i'Ff
Attomey'sName Marc W. Witzig, Esq. For Plaintiff
Address 232? d St
-F r is urg PA 17106
BRESLIN SPECIALIZED SERVICES
P.O. Box 325
Uppcr Darby, PA 19082
(610) 734-1647
County.
and make return thereof and according to Law.
County Sheriffs Check
ATTEST
PRO PROTHY
DATE
O Other
to 6 subeatted
Lucale hl Willey. Seal
upper Dario Willey. Notary Putllc
m
orrimission y 7w Delaware County
17,--g _ _ E- xpirp5 July 24, 20r 1
Telephonea_717- 238-67570 kdenliecatIont 2go2q
01 990 Plrltadelphla Assoc. of Profss"nat Process servers Rev 1
BRESLIN SPECIALIZED SERVICES
W-_
S National
Association of
Professional
Process Servers P.O. Box 325
Uppcr Darby, PA 19082
610 734-1647 Philadelphia
Auoci,tton or
Professional
Process Serves
AFFIDAVIT OF SERVICE
PLAINTIFF(S) COURT TERM a NO. COUNTY
Consumer Payment Services 99 - 3840 Cumberland
Nikos Valvanis 6-25-99 asap
SERVE AT 7 CIv9Aclion.Comm a i nQ Subpoena
8121 Old York Rd. O Summons - O Notice of Real Estate Sale
Elkins Park Pa a Writ of O OttW f d= of A-74-
Petition for Preliminary Injunction
Notice of Deposition, Subpoena
SPECIAL INSTRUCTIONS
Served and made known to
Ni knc Va 7 van i c
on the 25 day of = TnnP ,19 99 at 4:00 o'clock, P, M..
at 8121 01 C3 York RA County of-lnnrg=a4
Commonwealth of Pennsylvania. In the manner described below:
O Defendad(s)personaltyserved.
O Adult family member with whom said Defendant(s) reside(s). Relationship Is
O Adult In charge of Defendant's residence who refused to give name or relationship.
O Manager/Clark of place of lodging in which Defendant(s) reside(s).
)d Agent or peraos M charge of Defendant's office or usual place of business, NNaveed Qureshi
an otfkerof said Defendantcompany.
O Otter
DESCRIPTION AGE 30-35 HE104T 5-9" WEIGHT 150 lbs RACE Hindu SEX M OTHER
On the day of ,
Defendant not found because: O Moved O Unknown
19 at o'clock, M.,
O No Answer O Vacant
NAME OF SERVER
Boyd A. Breslin being duty awom according to law, deposes and
says that h*Ww Is e process serve heroin named and that the facts herein set With
above are true and correct to the beet of their knowledge, information and belief.
Sheriff Process Server/ Competent Aduft-,A
DEPUTIZED SERVICE
Now, this day of 19 . I do hereby deputize the Sheriff of
to serve this O Summons O Complaint O Other
By (Competent Aduh)
Law Firm (`nnningba,n Ch-Krli-r
Affomey'sNanle Marc W. WitzicrFor P•ainf•iff
Address 2320 n. Second St.
Harrisburg PA 17106
Telephoned 717-2386570 Identmcatlons 29ct2o
07990 Philadelphia Assoc. of Prafe"larrW Prouee Ssrvere Rev 1
O Other
Wom to a subscribed before me Ws
lsyd lin.? 1a 1?'
,J22 -dj&
ail Soal
Lucile A!. Wflkry. NClary Pubic
Uecar, arl;, Tvp.. Cela::arr County
PAy Crm:m_s.on expires July 24.2001
County.
and make return thereof and according to Law.
-County Sheriffs Check $
ATTEST
PROPROTHY
DATE
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
ORDER OF COURT
AND NOW, this 28th day of June, 1999, the
CONSUMER PAYMENT
SERVICES, A Division of
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
Defendants having failed to appear to show cause why the
preliminary injunction should not be continued, the
preliminary injunction issued by this Court on June 24,
1999, shall remain in full force and effect until further
order of Court.
The Plaintiff is directed to post bond with the
Prothonotary in the amount of $100.00 plus make all monthly
payments due under the contract on a timely basis to be
paid into court in the Prothonotary's Office as a condition
of the preliminary injunction remaining in full force and
effect.
The first monthly payment due pursuant to this
order shall be due on July 20, 1999, for amounts owed
during the month of June.
-I
By the Co
Edward E. Guido, J.
Jordan D. Cunningham, Esquire C:orx rn*alL£c(,
For the Plaintiffs 1
/.2y/FIF
:lfh
m ?.
U
y
ry
V
,Q
IZQ
4
I
CONSUMER PAYMENT
SERVICES, A Division of
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
IN THE COURT OF COMMON PLEAS
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 7?-
IN EQUITY
RDER
AND NOW, this day of 1999, upon
consideration of the verified Complaint in this action and the
accompanying Petition for Preliminary Injunctive Relief, it is
hereby ORDERED that:
C?
(a) Defe
Valvanis, ?. tiine f
enter' 3. any
ith rd 5r
'excl ely ed by
(b) end n
Val
IS;-CDI, NDI, aveed Quresh' d Nikos
r ^^
,)Retin sellinq,?co acti
sro?mmar
;sfiip or oint vet re ith y rd
the ent ys, m" tware
CQI laintiff
(c Defendants, I, NDI, Naveed Qureshi and Nikos
Valv nis,., r enjoined ro 'disclos' to any per o fi o
c po tion. nd traryie?sec ets, aped ails or, rg iz i o
u ness fair of CPS/ EMO, s we l as a na s f p t r
resent ust ers of y them, or y of r inf at on
relating to the business operatio of CPS/ME 0;
(d) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from changing the password to the
customer service module of the "Bill Payments System"
software, or, in any way, putting into place a security system
which will disable or impede the Plaintiff from using the
"Bill Payment System" software envisioned by the Agreement of
October 7, 1998 until all of the remedies of the Agreement
have been initiated, resolved and reached resolution;
r (e) is direC°ed to cause st's ttorn rey
Wo iv er to'S/ME aland
s unde Aareeme t.?ction 35, nd
2
Court
t.
Gn (g) Direc ed to show cause before the Court on the
day of 1999, at
.M., in Courtroom No. Cumberland County Courthouse,
Carlisle, Pennsylvania, why a preliminary injunction should
not be continued providing the relief requested by the
Plaintiff.
3
• ?l
Pi..nv..?SC.y 1?.?\0?! }? q? Cunrnn]3hnm
(n t_1 ?J\lly -,O CIICf C.tIC? QIfNI'.Z.?Mh.,
.9nc.? ?a?.?d CAuceah: N?lwS
Jvac I
w
CONSUMER PAYMENT IN THE COURT OF COMMON PLEAS
SERVICES, A Division of CUMBERLAND COUNTY, PENNSYLVANIA
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V. NO. tic?. 3S(1O I?-
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants IN EQUITY
PETITION FOR PRELIMINARY INnN TION
AND NOW, comes your Plaintiff, Consumer Payment Services,
a division of Merchants Express Money Order Company,
(hereinafter referred to as "CPS/MEMO") by and through its
attorneys, Cunningham & Chernicoff, P.C., and petitions this
Court on its behalf for the issuance of a special or
preliminary injunction, without hearing, pending a hearing to
be held within five (5) days, enjoining the Defendants from
interfering with Plaintiffs use of a comnuter snftwara
program known as "Bill Payment System" owned and/or operated
by Defendant, Currency Direct, Inc., (hereinafter referred to
as "CDI11) and/or Defendant, Direct, Inc., (hereinafter
referred to as 11NDI11) and directing its agents and employees
from refraining from entering or changing any password to
1
customer service modulars of the aforesaid software and from
promoting and marketing the use of software by third parties
until further Order of the Court.
This Motion is respectfully submitted because, as more
fully set forth in Plaintiff's Complaint:
1. Plaintiff, Consumer Payments Services is a division
of Merchants Express Money Order Company (hereinafter referred
to as "CPS/MEMO"), a Pennsylvania corporation with a principal
place of business at 1029 Mumma Road, Wormleysburg, Cumberland
County, Pennsylvania. Plaintiff's, CPS/MEMO, business
includes, but is not limited to, selling money orders and the
collection from customers and payment of public utility
payments.
2. Defendant, Currency Direct, Inc. (hereinafter
referred to as "CDI"), is a Pennsylvania corporation with a
place of business at 10050 Roosevelt Boulevard, Philadelphia,
Philadelphia County, Pennsylvania.
2
3. Defendant, Neu Direct, Inc., (hereinafter referred
to as "NDI") is a Pennsylvania corporation with a place of
business ac 1821 Old York Road, Elkins Park, Montgomery
County, Pennsylvania.
4. Defendant, Naveed Qureshi, is an adult individual
who conducts business at 1821 Old York Road, Elkins Park,
Montgomery County, Pennsylvania.
5. Defendant, Nikos Valvanis, is an adult individual
who conducts business at 1821 Old York Road, Elkins Park,
Montgomery County, Pennsylvania.
6. Defendant, Naveed Qureshi, is the President of
Defendant, CDI, and to the Plaintiffs belief, is an officer
of Defendant, NDi.
7. Defendant, Nikos Valvanis, is believed and therefore
averred he is an agent or principal of Defendant NDI and acts
in concert with Defendant, CDI.
8. Plaintiff possesses a license from the Pennsylvania
Department of Banking known as a money transmitter license
3
9. On October 7, 1998, Plaintiff and Defendant, CDI,
entered into an agreement entitled "Agreement to Establish
Bill Payment Service " (the "Agreement"). A true and correct
copy of the Agreement is attached hereto, made part hereof,
and is incorporated herein by reference and marked Exhibit ,P-
1".
10. In May, 1999, CPS/MEMO has received information, and
therefore avers, that Defendant Naveed Qureshi, President of
CDI, and acting in its capacity as President of Defendant,
CDI, traveled to Minneapolis, Minnesota, where he represented
to one or more entities that Defendant, NDI, owns, has full
rights regarding, and is not restricted as regards, any use or
licensing of the "Bill Payment System" software program
licensed by CDI to CPS/MEMO under Section 5(c) of the
Agreement.
11. Plaintiff, since April, 1999, has received
information and therefore is of the belief that Defendants,
Naveed Qureshi, Nikos Valvanis, and CDI, have violated a
number of the provisions of the Agreement in that the
Defendants have attempted to market the "Bill Payment System"
software in violation of the Agreement of October 7, 1998.
4
12. Under the terms and conditions of the Agreement of
October 7, 1998, Plaintiff, CPS/MEMO, was to pay all monthly
obligations owed under the Agreement to Defendant, CDI.
13. Plaintiff, CPS/MEMO, moreover, is of the belief and
therefore avers that Defendants, Naveed Qureshi, Nikos
Valvanis, and CDI violated a number of the provisions of the
Agreement of October 7, 1998 in that the "Bill Payment System"
software has never been fully operational and does not
approach acceptable levels of performance; and that Defendant,
CDI's processor, Defendant, NDI, has submitted invoices
asserting out-of-pocket expenses for reimbursement that
otherwise should have been made by CDI.
14. On May 20, 1999, Plaintiff, CPS/MEMO, paid the
monthly obligation owed for April, 1999 under the Agreement to
Defendant, CDI.
15. Defendant, Naveed Qureshi caused Defendant CDI to
refuse to negotiate the April, 1999 check.
5
16. Defendant, NDI, on May 28, 1999, intercepted and
voided the check issued by Plaintiff, CPS/MEMO, to Defendant,
CDI, and demanded direct payment of the April, 1999 obligation
to Defendant, NDI.
17. Initially, Plaintiff, CPS/MEMO, refused the demand
of Defendant, NDI, to pay the April, 1999 obligation to
Defendant, NDI.
18. Between May 28, 1999 and June 13, 1999, several
discussions regarding the issue of payment of the April and
May, 1999 obligations were held between Plaintiff, CPS/MEMO,
and Defendants, Naveed Qureshi and Nikos Valvanis.
19. On June 14, 1999, and without notice, Defendant,
NDI, and its officers or agents, Defendants, Naveed Qureshi
and Nikos Valvanis, changed the password to the customer
service modular of the "Bill Payment System" software, in
effect shutting down CPS/MEMO operations.
6
20. As the result of said change to the password to the
software, various vendors' bills and utility bills would not
have been paid or honored, thus subjecting utility customers
to potential shut-off.
21. On June 14, 1999, Defendant, Nikos Valvanis, an
officer of Defendant, NDI, and President of Defendant, CDI,
declared to employees of MEMO that unless monies were directly
wired to NDI for payment of services, instead of to Defendant,
CDI, that the password to the customer service modular of the
"Bill Payment System" software would be changed, thus placing
Plaintiff's operations out of business.
22. On June 14, 1999, Plaintiffs, CPS/MEMO, in reaction
to the demand of the Defendants, Naveed Qureshi, Nikos
Valvanis, and NDI, wire transferred the April and May, 1999
obligation owed to Defendant, CDI to the account of Defendant,
NDI.
23. On June 14, 1999, Defendant, NDI, restored the
operation of the "Bill Payment System" software upon
confirmation of the receipt of funds.
7
24. The law does not favor forfeiture, and a forfeiture
of a leasehold must be strictly construed. The provisions of
a Lease will be construed, if possible, to avoid a forfeiture.
Elizabethtown Lodge. Loyal Order of Moose v. Ellis, 391 Pa.
19, 137 A.2d 286 (1958), and Northway Village No. 3. Inc. v.
Northway Properties. inc., 430 Pa. 499, 244 A.2d 47 (1968).
25. The party seeking the benefit of a forfeiture for
the breach of a Lease has the burden of showing that the
breach is so substantial as to justify regarding the whole
transaction as ended. Easton Theatres. Inc. v. Wells. Fargo.
Land & Mortgage Co., 265 Pa. Super. 334, 401 A. 2d 1333 (1979),
anneal dismissed, 498 Pa. 557, 449 A.2d 1372.
26. The test for determining the materiality of a breach
of a contract includes consideration of the following
elements:
(a) The extent to which the injured party will
obtain the substantial benefit which he could reasonably have
anticipated;
8
(b) The extent to which the injured party may be
adequately compensated for damages for lack of complete
performance;
(c) The extent to which the party failing to
perform has already partly performed or made preparation for
performance;
(d) The greater or lesser hardship on the party
failing to perform in terminating the contract; and
(e) The willful neglect or innocent behavior of the
party failing to perform.
Blue Ridge Metal Manufacturing Co v Procto r, 327 Pa. 424,
194 A. 559 (1937); and Cimina v. Bro nich, 349 Pa. Super. 399,
503 A.2d 427 (1985).
27. The Plaintiff will suffer immediate and irreparable
harm if an injunction is not granted. Defendants' continuing
conduct deprives the Plaintiff of property rights to which it
is entitled by operation of law and which are not redressable
by damages. Unless enjoined, the actions of the Defendants
9
will result in a further wasting, diminution and conversion of
the Plaintiff's assets by virtue of the Defendants' continuing
market of Plaintiff's exclusive right to market the "Bill
Payment System" and threatened to change the password to the
customer service modular of the software or otherwise disable
the software, thus putting Plaintiff out of business.
Moreover, by causing a breach of the Plaintiff's obligations
to third parties, Defendants have and will place Plaintiff in
the position that it will default under various contracts with
third parties, which potential defaults, unless promptly
cured, will result in civil actions for monetary claims which
in turn will result in the loss of business opportunities and
the cessation of Plaintiff's business to the irreparable harm
of the Plaintiff.
28. Unless Defendants are enjoined preliminarily, the
status ouo will not be preserved and the Plaintiff's business
will be lost.
29. The Plaintiff has no adequate remedy at law to
redress and the current and impending harm from Defendants'
10
continued conduct. The destruction of the Plaintiff's
business by the Defendants' continued actions is not
redressable by monetary damages.
30. Defendants will not be substantially harmed if the
special relief prayed for is granted, pending a final
determination of the matter on the merits.
31. There is a substantial likelihood that Plaintiff
will ultimately be successful on the merits of the case.
32. The Defendants have advised Plaintiff that they
intend to continue to take such action as to render the
software inoperable if Plaintiff refused to pay Defendant,
NDI, instead of Defendant, CDI. NDI has threatened to render
software inoperable if Plaintiff does not agree to an
exclusive processing agreement with Defendant NDI.
33. The Defendants will not suffer any appreciable
injury if the requested preliminary injunction is issued
because the status quo between the parties will be restored to
11
where it was before Defendants' wrongful conduct began.
Defendants will merely be restrained from taking advantage of
its wrongful acts.
34. Defendants will remain free to pursue its legal
rights in a lawful manner.
35. The Plaintiff is likely to succeed on the merits of
its claims. The obligation of the Defendants to pursue its
remedies pursuant to the common or statutory law of the
Commonwealth of Pennsylvania is clear.
36. These rights are enforceable in equity, and
Plaintiff will be entitled, upon a final hearing, to a
permanent injunction against the Defendants' actions of self-
help and conversion of the Plaintiff's assets.
37. Plaintiff is of the belief and therefore avers that
the actions of Defendants, CDl, Naveed Qureshi and Nikos
Valvanis, as set forth in this Petition, are of the type which
violate Section 9 of the Agreement which provides for a
12
consent judgment of an injunction against the Defendant, CDI,
Naveed Qureshi and Nikos Valvanis, as parties, and officers
and employees to restrain such action.
WHEREFORE, Petitioner/Plaintiff prays your Honorable
Court:
(a) Pursuant to Pa. R.C.P. No. 1531(a) issue a
preliminary or special injunction prior to written notice to
the Defendants and to do so without the necessity of posting
bond, or in the alternative, upon hearing, grant a permanent
injunction enjoining the Defendants, as follows:
(i) Defendants, CDI, NDI, Naveed Qureshi and
Nikos Valvanis, are enjoined from marketing, selling,
contracting or entering into any partnership or joint venture
with any third party with regard to the "Bill Payment System"
software exclusively licensed by CDI to Plaintiff;
(ii) Defendants, CDI, NDI, Naveed Qureshi and
Nikos Valvanis, are enjoined from marketing, selling,
contracting or entering any business in competition with the
business being conducted by CPS/MEMO;
13
(iii) Defendants, CDI, NDI, Naveed Qureshi
and Nikos Valvanis, are enjoined from disclosing to any
person, firm or corporation and trade cecrets, any details or
organization or business affairs of CPS/MEMO, as well as any
names of past or present customers of any of them, or any
other information relating to the business operations of
CPS/MEMO;
(iv) Defendants, CDI, NDI, Naveed Qureshi and
Nikos Valvanis, are enjoined from changing the password to the
customer service module of the "Bill Payments System"
software, or, in any way, putting into place a security system
which will disable or impede the Plaintiff from using the
"Bill Payment System" software envisioned by the Agreement of
October 7, 1998 until all of the remedies of the Agreement
have been initiated, resolved and reached resolution;
(v) CDI is directed to cause its attorney
Geoffrey Gomper to deliver to CPS/MEMO all materials,
programs, and code he holds under Agreement Section 35; and
(b) Following hearing, award Plaintiff compensatory
damages in an amount your Honorable Court sees fit.
14
(c) Following hearing, award punitive damages to
the Plaintiff in an amount your Honorable Court sees fit.
(d) Enter judgment for the Plaintiff herein and
against the Defendants for all monetary damages incurred as
the result of Defendants' illegal actions.
(e) Grant such other relief as your Honorable Court
sees fit.
submitted,
P. C.
Date: t'' /"/gg
'C.D. #23144
Marc W. Witzig, Esquire
I.D. #29929
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
Telephone: (717) 238-6570
(Attorneys for Plaintiffs)
bl\doca\oetition\conaumer
15
JUN.23.19993 12:59PM MEMO MONEY ORDER CO 717NO.716?9 P.2 /?
J yl\ GJ 1JJ yJ'JJ yyl l\?,1\yllAll pl \. ZRNICOFF
I, Tanya Butler, Vice President of Merchants Express Money
Order Company verify that the statements made in the foregoing
Petition for Preliminary injunction are true and correct to the
best of my knowledge, information, and belief. I understand that
false statements herein are made subject to the penalties of 18
Pa. C.S.A. §4904, relating to unworn falsification to
authorities.
Tanya sutler, Vice President
TOTAL P.03
E E H I B I T NP-11
AGREEMENT TO ESTABLISH "BILL PAYMENT SERVICE"
RECITALS
THIS Agreement made this 7A day oflti4u, 1998, by and between
CONSUMER PAYMENTS SERVICES, a division of MERCHANTS EXPRESS
MONEY ORDER COMPANY, a Pennsylvania Corporation with a place of business at
1029 Mumma Road, Wormleysburg, PA 17043 (hereinafter "MEMO") and
CURRENCY DIRECT, INC. ("CDI"), a Pennsylvania Corporation, with a place of
business at 10050 Roosevelt Blvd., Philadelphia, PA 19114.
WITNESSETH
WHEREAS, a substantial and growing market exists for "Bill Payment Services"
to be provided to consumers through agent locations; and
WHEREAS, CPS, through a division of MEMO to operate with the trade name,
"Consumer Payment Services: (hereinafter, "CPS"), desires to enter this Agreement
(hereinafter "Agreement") with CDI for the provision of those services; and
WHEREAS, CDI desires to enter into this Agreement with CPS, for the provision
of those services; and
WHEREAS, CPS has the necessary expertise, the necessary licenses, a substantial
agent base, and marketing staff; and
WHEREAS, CDI has the appropriate computer knowledge, software applications,
networking capabilities and communications expertise.
NOW, THEREFORE, the Parties, intending to be legally bound, agree to enter
into the Agreement under the following terms and conditions.
AGREEMENT
1. The purpose of this Agreement is to establish an independent contracting
agreement between the Parties to permit consumers to pay utility and other select types of
invoices (hereinafter "Bills") at various agent locations (hereinafter "Agent"), and to
establish a procedure for the profit of the Parties whereby agents can make Bill Payments
to vendors via computer software developed and owned by CDI.
2. CPS and CDI acknowledge that the Bill Payment System ("System") software
developed by CDI to implement a Bill Payments Service, may require further
clarifications and modifications as the procedures and regulations applicable to Bill
Payments and Electronic Payments ("El's") are developed or changed. To that end, CPS
and CDI shall cooperate with each other in good faith, each use its best efforts, and shall
Agreement to establish "BILL PAYMENT SERVICE" Page 1 of 14
generally share, subject to the confidentiality requirements imposed under this
Agreement, any information that reasonably may be required by the other Patty, with the
goal of ensuring the successful development and implementation of the Bill Payment
Services Program.
3. MEMO agrees to establish a separate operating division known as Consumer
Payment Services (hereinafter "CPS"), a division of Merchants Express Money Order
Company, a Pennsylvania Corporation." MEMO will set up separate books and records
for said division, and will keep all activities of this division separate and apart from its
other business operations. MEMO will file the appropriate fictitious name certificate
applications for CPS. CPS will not have any full or part-time employees unless agreed to
by the Parties, but rather its activities will be conducted either on a contract basis, or on
the basis where PFMA, CDI, Westside Check Cashing Inc. or Neu Direct employees will
perform services for CPS, subject to the approval of the Governing Committee (as
hereinafter defined), and shall be reimbursed for said services by CPS.
4. The Parties acknowledge that, in certain states in which MEMO operates,
MEMO is licensed through one or more subsidiaries, currently MEMO Money Order
Company and MEMO - New York. At such time as the business expands into these
states, MEMO will cause its subsidiary(s) to form a division, "Consumer Payment
Services", and this division will operate the bill payment service in the same manner as
CPS operates as a division of Merchants Express Money Order Company. Financial
Reports for all CPS divisions will be combined. Both Parties acknowledge that the name
Consumer Payment Services" may not be clear in all states, and the service may operate
subject to the conditions of this contract under an agreed upon alternate name in those
states.
S: Subject to the terms and conditions set forth below, in connection with the Bill
Payment Services Program, CDI and CPS shall at all times during the Initial Term and
any Subsequent Term of this Agreement provide, render and perform the services
necessary to implement and operate the Bill Payment Services Program. Specifically, the
Parties shall provide services to CPS as specified below:
A. CPS and CDI agree that CPS shall supervise and direct the day to day
management and operation of CPS's ordinary and usual business affairs, subject to the
instructions, guidance, and directions of a "Governing Committee which shall at all times
be composed of two members selected by CDI and two members selected by MEMO.
B. MEMO agrees to use its best efforts to market and distribute on behalf
of CPS and to do all things reasonable to fully promote and support CPS and its business
objectives.
C. CDI agrees to make available for the exclusive use by CPS in its
business operations a certain "Bill Payment Services" software program including certain
data processing services. The attributes of the System, as currently developed, are
Agreement to establish "BILL PAIMENTSERVICE" Page 2 of 14
defined in Appendix A hereto. It is understood and agreed by the Parties that CPS shall
compensate CDI for enhancements to the System later developed in accordance with
expense reimbursement procedures outlined in 8A. These enhancements shall be over
and above the fully operational system as reported by CDI prior to system rollout
D. CD' will provide the System at a fully operational stage, as defined by
the governing committee. (See Appendix A for Current Operational Stage). CDI agrees
to maintain, develop, improve, and/or innovate the System to meet the continual
operational, regulatory, or competitive demands of the business. The cost of such
maintenance, development, improvement and/or innovation will be funded by CPS out of
CPS fees under expense reimbursement guidelines outlined in 8A. In the event that the
Governing Committee by majority vote declares that CDI cannot timely or cost
effectively complete such maintenance, development, improvement and/or innovation, or
any part thereof, CPS and/or MEMO will have the full authority to contract with and/or
employ vendors/staff necessary to perform the functions.
1. CDI wan-ants that it has the legal right to grant to CPS the exclusive
use as set out in Paragraph 5(C) of this Agreement and that such license does not infringe
upon any third Party's property or personal rights.
2. CDI warrants there are no lawsuits pending or threatened concerning
CDI's rights to license and use the System, and that the System has not been published in
such a way as to lose any of its copyright or Patent protections.
3. CDI will have a qualified Patent/Copyright Attorney review all
components of the System, including software to the best of the Patent/Copyright
Attorneys opinion and after a diligent search render a written opinion that the System,
including software do:.s not infringe upon any patent, copyright, trade secret, or other
property rights of a third Party. Further, this attorney should also render an opinion of
whether CDI would be reasonably advised to Patent or apply for Copyright protection.
4. CPS agrees to provide marketing, licenses, customer service,
management, general accounting services, record keeping and reporting services as may
be required and shall receive payment in accordance with Paragraph 8A. CPS, shall
collect monies from the agents, hold receipts and shall make appropriate disbursements
for Bills at such times as required. The Parties acknowledge that MEMO and its
subsidiaries and divisions are subject to accounting and reporting rules under GAAP,
state banking regulations, etc., and that these rules require strict adherence to certain
accounting and reporting standards in the conduct of its business. The Parties agree that
accounting and reporting for CPS will conform to any and all accounting, reporting, etc.,
standards which otherwise apply to MEMO. CDI will make all software changes
necessary for CPS to efficiently and accurately provide these services, and shall receive
payment in accordance with Paragraph 8A.
Agreement to establish "BILL PAYMENT SERVICE" Page 3 of 14
5. MEMO agrees to maintain separate books and records for CPS and to
conduct CPS at all times as a separate division of MEMO. MEMO shall keep accurate,
full, and complete books and accounts showing the assets, liabilities, operations,
transactions, and financial condition of CPS. Such books and records shall be kept at
MEMO's principal office and/or at a suitable off-site storage area. CPS shall operate on a
fiscal year ending June 30. Monthly financial statements for CPS shall be prepared by
MEMO and provided to all Parties. On or before September 15 of each year, CPS shall
provide to the Parties annual financial statements.
6. Unless otherwise agreed to by all Parties, both Parties shall provide at no cost
to CPS general consulting services from time to time as the need arises. Each Party will
have various computer hardware at its location in order to provide services for CPS. This
equipment must not be encumbered in anyway or used as collateral for any other business
venture of either Party or affiliated companies.
7. MEMO or CPS with the majority approval of the Governing Board, may hire,
fire, promote, demote employees or contract with other providers of services as
necessary. Costs will be paid subject to Expense Reimbursement Guidelines.
g. The Parties shall receive fees and expense reimbursements as follows:
A. Each Party shall be reimbursed for reasonable and necessary expenses
as approved by the Governing Committee and reimbursement shall generally occur on or
about the 20th day of each month provided all invoices are submitted to CPS no later than
the 5th of each month. Each Party will provide vendor invoices for all out pocket
expenses to be reimbursed. In the event that there is insufficient revenue to cover these
expenses, the Parties will be reimbursed as much as possible.
B. Each Party shall receive a fee of five cents ($.05) per transaction for its
contribution to CPS, provided that sufficient revenue was generated to cover this
distribution. This fee shall be paid monthly at the same time as expense reimbursement.
In the event that there is insufficient revenue to fund these fees, them will be either a pro
rata distribution or no distribution.
C. Additional fees may, with majority approval of Governing Board, be
paid to each Party as independent contractors for consulting services as specified above
under this Agreement. Such additional payments (hereinafter "Commission
Compensation") shall be paid quarterly (as of the end of March, June, September, and
December) on or before the 20th of the month next following the month in which each
calendar quarter ends. Commission Compensation shall be determined on an accrual
basis by taking into account the net income of the operations of CPS, which shall mean
actual gross revenues less reimbursements, operating expenses and bad debt accruals of
CPS, and shall equal Fifty Percent to each Party of the income of the operations of CPS.
Additionally„ if the Governing Committee agrees to operating losses as defined by
Agreement to establish "BILL PAYVENT SERVICE"
Page 4 of 14
distributed financial statements, each Party shall reimburse CPS Fifty Percent (50%) of
such losses within twenty (20) days of being notified.
D. No later than July 1, 2000, the revenue sharing will be converted from
a profit sharing to a per item fee for each parry. Profits and costs of each party will be
analyzed with the end result being that each party will net the same profit per item as they
would have under the initial revenue sharing agreement.
9. The Parties agree that during the term of this agreement including any
renewals, and, for a period of one (1) year following the termination of this Agreement,
neither Party shall conduct or operate any business in direct or indirect competition with
CPS unless specifically agreed to in writing by both Parties, except as stated in Paragraph
14. This restriction shall not prohibit any Party from pursing any other business venture
which does not compete with CPS. This does not prohibit either Party from continuing
the business in the case of a default cited in Paragraph 14. However, this restriction shall
prevent the officers of either Party from the following activities:
A:, Engaging as an officer, employee, partner, employee shareholder, or
any other capacity, in any business in competition with any business then being
conducted by CPS at the time this Agreement is signed;
.B. Requesting any customers of any business then being conducted by
CPS to curtail or cancel their business with CPS;
C. Disclosing to any person, firm or corporation any trade secrets, any
details of organization or business affairs of CPS, MEMO and/or CDI, as well as any
names of past or present customers of any of them, or any other information relating to
the business operations of CPS, from time to time certain non-proprietary information
regarding CPS may be used to further marketing efforts. Due diligence shall be exercised
by either Patty while discussing CPS Operations with third Patties;
D. Inducing, or attempting to influence, any employee of CPS to
terminate employment with the CPS or to enter into any employment or other business
relationship with any other person, firm or corporation.
c.. Acting or conducting itself in any manner which may reasonably be
believed to be harmful or contrary to the best interests of CPS.
The Parties recognize that immediate and irreparable damage will result to CPS if ,
either breaches any of the terms and conditions of this Section and, accordingly, each
hereby consents to the entry by any Court of competent jurisdiction of an injunction
against itself to restrain any such breach, in addition to any other remedies or claims for
money damages which the CPS may seek.
Agreement to establish "BILL PAYMENT SERVICE" Page 5 of 14
10. The Agreement shall not be deemed to create a partnership or joint venture
among the Parties. The relationship is defined and understood as a contract among
independent contractors, and no action shall be deemed to bind other Parties except to the
extent, if any, as defined in this Agreement. At no time during this Agreement will CDI
acquire any capital, equity, profits or other interest in any entity owned by or affiliated
with Pennsylvania Food Merchants Association, the parent of MEMO, or MEMO itself.
11. The initial Term of the Agreement shall be Fifteen (15) years unless sooner
terminated by the Default (as defined below) of either Parry. The Agreement shall
automatically renew for successive five (5) year periods following the end of the initial
term unless one hundred eighty (180) days written notice is provided by the Party
desiring termination. In the event of termination, the Party not initiating the termination
shall have a right of first refusal to continue to operate the business under the CPS' name
and shall have access to software (including source code) or agent information as the case
may be. The Party continuing the business shall compensate the other Party for the
provision of agents or software, as the case may be, at a value to be determined by an
independent appraisal. Each Party will pick an appraiser, and these two (2) appraisers
will pick a third appraiser who will conduct an itdependent appraisal to determine the
value.of CPS. The Party continuing CPS's service(s) will compensate the other Party
fifty (50) percent of the value in equal monthly payments over a period not to exceed a
twenty four (24) month period. The payments will be restricted to the actual value of the
service with no interest. The terminating Parry shall be prohibited from providing agent
information or software or information about the nature, structure, or operation of the
business, as the case may be, to any person and/or entity for the time period in which the
Party continuing the business does actually continue the business. In the interest of not
losing existing agent base (if CDI were to continue business) CDI must make provisions
to convert agents within one hundred eighty (180) days of CPS' default. All Parties
acknowledge that all Money Transmitter Licenses owned by MEMO or its subsidiaries
cannot be transferred, assigned or sold to CDI or any other entity under any circumstance.
In the event that either Westside Check Cashing, Inc. 's Majority Stockholder (Mike
Carlone) or Neu Direct's Majority Stockholder (Naveed Qureshi) are no longer affiliated
with CDI, MEMO will have the right to approve or disapprove any nominations to the
Governing Committee by CDI.
12. This Agreement may be terminated for cause ("Termination for Cause") by
either Party upon delivery of written notice of the intention to terminate and the cause for
such termination to the other Party not less than 30 days after delivery of such notice
("Termination for Cause Date") unless the receiving Party cures prior to the Termination
for Cause Date. For purposes of this Paragraph "cause" shall mean illegal acts, willful
misconduct, actual fraud or the occurrence of other Events of Default as defined
hereinafter. Upon termination the grieving Parry will assume operation of CPS, and shall
buy out defaulting Party in accordance with terms in Paragraph 11.
Agreement to establish "BILL PAYMENT SERVICE" Page 6 of 14
13. Effect of Termination. Except to the extent otherwise provided in this
Agreement, upon termination of this Agreement, the obligations of the Parties shall cease.
14. Events of Default. An "Event of Default shall mean the occurrence or
existence of one or more of the following events or conditions (whatever the reason for
such Event of Default and whether voluntary, involuntary or effected by operation of
law):
(A) Either Party fails to perform in a reasonably timely manner any material
obligation under this Agreement;
(B) Any representation or warranty made by either Party under this Agreement or
any financial statement, certificate, report, exhibit or document required to be famished
pursuant to this Agreement shall prove to be materially false or intentionally misleading
in any material respect as of the time when made (including by omission of material
information necessary to make such representation, warranty or statement not
misleading);
(C) Either Party shall default in the performance or observance of any covenant,
agreement or duty under this Agreement and such default shall have continued for a
period of 30 days after notice of such default;
(D) Any material adverse change in either Party's business, operations, condition
(financial or otherwise), properties, assets, or prospects shall occur;
(E) One or more judgments for the payment of money shall have been entered
against either Party, or principles of either Parry which judgment or judgments shall have
remained undischarged, or unappealed, or unstayed for a period of 90 consecutive days
after notice of the same.
(F) A proceeding shall have been instituted in respect of either Party (1) seeking
to have an Order for relief entered in respect to such Party, or seeking a declaration or
entailing a finding that such Party is insolvent or a similar declaration or finding, or
seeking dissolution, winding up, charter revocation or forfeiture, liquidation,
reorganization, arrangement, adjustment, composition or other similar relief with respect
to such Party, its assets or its debts under any law relating to bankruptcy, insolvency,
relief of debtors or protection of creditors, termination of legal entities or any other
similar law now or hereafter in effect, or (2) seeking appointment of a receiver, trustee,
custodian, liquidator, assignee, sequestrator or other similar official for such Party or for
all or any substantial part of its property; or
(G) Either Party shall become insolvent, shall become generally unable to pay its
debts as they become due, shall voluntarily suspend transaction of its business, shall
make a general assignment for the benefit of creditors, shall institute a proceeding
described in Paragraph 14(F) above, or shall consent to any order, declaration, or finding
Agreement to establish "BILL PAYMENT SERVICE" Page 7 of 14
for relief described therein, or shall consent to any such appointment or to the taking of
possession by any such official of all or any substantial part of its property, shall dissolve,
windup, revoke or forfeit its charter (or other constituent documents) or liquidate itself or
any substantial part of its property, or shall take any action in furtherance of any of the
foregoing.
15. If any Event of Default listed in the preceding section shall occur or continue
to exist, the non-defaulting Party may exercise one or more of the following remedies:
(A) Terminate this Agreement upon notice to the defaulting Party in accordance
with the preceding paragraphs of this Agreement, including, but not limited to Paragraph
11;
(B) Take such other action as may be permitted by applicable law.
(C) Continue to tun CPS on a day to day basis so as not to place the service in
jeopardy to existing agents.
16. The Parties' remedies under this Agreement are non-exclusive and
cumulative; and each may be exercised separately, concurrently with any other remedy or
in any order or manner permitted under Applicable Laws, and without the need to exhaust
any other remedy provided hereunder. The provisions if this Paragraph 16 shall survive
termination of this Agreement, and shall continue indefinitely.
17. Any controversy or claim arising between the Parties and relating to the
Agreement, shall be resolved by binding arbitration. This Agreement to arbitrate shall
continue in full force and effect despite the expiration or termination of this Agreement.
All arbitrations shall be undertaken pursuant to the Rules of the American Arbitration
Association, and the decision of the arbitrators shall be final and enforceable in any court
of competent jurisdiction absent actual fraud. The Parties knowingly and voluntarily
waive their rights to have their dispute adjudicated by a judge or jury. The arbitrator shall
apply the law of the Commonwealth of Pennsylvania and the arbitration shall be held in
the defending Party's area (Philadelphia County for CDI; Dauphin County for CPS).
18. Any Party may demand arbitration by sending written notice to the other
Party. The arbitration and the selection of arbitrator(s) shall be conducted in accordance
with such rules as may be agreed upon by the Parties, or failing Agreement within thirty
(30) days after arbitration is demanded, under the commercial Arbitration Rules of the
American Arbitration Association ("AAA"), as such rules may be modified by this
Agreement. In any dispute which involves more than $100,000.00 in damages, three
arbitrators shall be used. Unless the Parties agree otherwise, they shall be limited in their
discovery to relevant documents. Responses or objection to a document request shall be
served within twenty (20) days after receipt of the request. The arbitrator(s) shall resolve
any discovery disputes. CPS must continue to operate in the interim.
Agreement to establish "BILL PAYMENT SERVICE" Page 8 of 14
19. The arbitrator(s) shall have the authority to award actual money damages
(with interest on the unpaid amounts from the due date), specific performance, and
temporary injunctive relief, but the arbitrator(s) shall not have the authority to award
exemplary, punitive, or consequential damages, and the Parties expressly waive any
claimed right to such damages. The costs of arbitration, but not the costs and expenses of
the Parties, shall be shared equally among the Parties. If a Party fails to proceed with
arbitration, unsuccessfully challenges the arbitration award, or fails to comply with the
arbitration award, the other Party is entitled to costs, including reasonable attorney's fees,
for having to compel arbitration or defend or enforce the award. Except as otherwise
required by law, the Parties and the arbitrator(s) agree to maintain as confidential all
information or documents obtained during the arbitration process, including the
resolution of the dispute.
20. All notices required or permitted hereunder shall be in writing and shall be
served to the following address:
Consumer Payment Services
Merchants Express Motley Order Company
1029 Mumma Road
Wormleysburg, PA 17043
Currency Direct, Inc.
10050 Roosevelt Blvd.
Philadelphia, PA 19114
21. In the event that any term or provision of the Agreement or any application
thereof to any person or circumstances shall be declared prohibited, invalid, or
unenforceable to any extent in any jurisdiction, as determined by a court of competent
jurisdiction, such tetra or provision shall, in that jurisdiction, be ineffective only to the
extent of such prohibition, invalidity, or unenforceability, or as applied to such persons or
circumstances, without invalidating or rendering unenforceable the remaining term or
provisions hereof or affecting the validity or enforceability of such term or provision in
any other jurisdiction or as to other persons or circumstances in such jurisdiction.
22. This Agreement shall be governed exclusively by the laws of the
Commonwealth of Pennsylvania.
23. This Agreement contains all the agreements between the Parties regarding the
subject matter hereof and may not be modified orally or in any manner other than by
Agreement in writing signed by the majority of members of the Governing Committee.
24. This Agreement is intended solely for the benefit of the Parties hereto and no
covenant or the provision herein shall create any rights in, or give rise to any cause of
action by, any other person not a Patty hereto.
Agreement to establish "BILL PAYMENT SERVICE" Page 9 of 14
25. This Agreement shall inure to the benefit of and be binding upon the Parties
and their respective legal representatives, successors, and permitted assigns.
26. No Party may assign its rights or obligations hereunder without the prior
written consent of all other Parties.
27. The CPS name shall not be used by the Parties for any purpose other than
contemplated under this Agreement without the prior written consent of all other Parties.
28. Unless the context of this Agreement otherwise clearly requires, references to
the plural include the singular, the plural and the part, the whole; "or" has the inclusive
meaning represented by the phrase "and/or, and "property" includes all properties and
assets of any kind or nature, tangible or intangible, real, personal or mixed. References in
this Agreement to "determination" (and similar terms) include good faith estimates by the
Parties (in the case of quantitative determinations) and good faith beliefs by the Parties
(in the case of qualitative determinations). The words "hereof," "herein," "hereunder"
and similar terms in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement.' Section, subsection, exhibit and schedule
references are to this Agreement unless otherwise specified.
29. Each Party shall take such other actions as the other Party may reasonably
request to ensure that this Agreement is given full affect, including, but not limited to the
execution of such other documents and Agreements as may reasonably be necessary.
30. In addition to complying with this Agreement, CPS shall at all times comply
with any Federal, State, local or other law, rule, court order, court decision,
administrative decision, administrative order, regulation, statute, commentary, injunction
or other authority applicable to, and including without limitation the requirements of all
FEDERAL, STATE, and local governmental and regulatory or supervisory authorities
(collectively, "Governmental Authorities") having jurisdiction over (collectively,
"Applicable Laws").
31. (1) CPS shall provide the Parties, and each of their staff, internal and external
auditors, or other authorized agents or representatives with access to (1) such facilities,
information, data, files, records, policies and procedures which are part of or relate to the
Bill Payment Service Program, CPS's Services or CPS finances, including without
limitation audits performed by CPS's external auditors, if applicable, (collectively,
"Company Books and Records"), and (2) such employees, agents or representatives of
CPS that are responsible for providing or supervising the provision of the Company
Services or ensuring compliance with or supervising the compliance with the Company
Procedures ("Company Relevant Employees"), as may be reasonably necessary with
respect to the Bill Payment Services Program, CPS's Company Services or Procedures.
Such access shall be provided at CPS's offices upon reasonable prior notice.
Agreement to establish "BILL PAYMENT SERVICE" Page 10 of 14
32. The Parties each hereby represent, warrant and covenant to each other as
follows:
(A) Each is a Pennsylvania corporation, validly existing and in good standing
under the laws of the Commonwealth of Pennsylvania.
(B) Each has the power and authority to execute, deliver, perform, and take all
actions contemplated by this Agreement, and all such action has been duly and validly
authorized by all necessary proceedings on its part.
(C) This Agreement has been duly and validly executed and delivered by each
Parry. This Agreement constitutes the legal, valid and binding obligation of each Party,
enforceable against each in accordance with its terms.
(D) Each Parry shall make reasonable efforts to maintain the overall quality of
CPS Services to be provided hereunder. The quality of all such Services shall be
consistent with the Procedures set forth herein.
(E) Each Party is familiar with all Applicable Laws that in any way govem this
Agreement or the Services. Each is in full compliance with all such Applicable Laws as
they apply to CPS Services or otherwise to CPS in connection with the Bill Payment
Services Program.
(F) Each Party has applied for and obtained all consents, licenses or other
approvals required by any Governmental Authorities for CPS to engage in the activities
contemplated by, and to perform its obligations under, this Agreement, including without
limitation Bill Payment Services.
(G) Neither the execution and delivery of this Agreement by either Parry, nor
consummation by the Parties of the transactions herein contemplated, nor performance of
or compliance with the terns and conditions hereof by the Parties (including without
limitation providing, rendering and performing this Agreement) does or will:
(i) violate or conflict with any Applicable Law, or
(ii) violate, conflict with or result in a breach of any term or condition of,
or constitute a default under, or result in (or give rise to any right,
contingent or otherwise, of any person or entity to cause) any
termination, cancellation, prepayment or acceleration of
performance of, or result in the creation or imposition of (or give
rise to any obligation, contingent or otherwise, to create or impose)
any lien upon any property of the Company pursuant to, or otherwise
result in (or give rise to any right, contingent or otherwise, of any
person or entity to cause) any change in any right, power, privilege,
duty or obligation of either Party or in connection with,
Agreement to establish "BILL PAYMENT SERVICE" Page 11 of 14
(A) the charter or by-laws (or other constituent documents)
of either Parry; or
(B) any agreement, indenture or instrument to which either
Party is a Party or by which it or any of its properties
(now owned or hereafter acquired) may be subject
or bound.
33. All non-public information relating to the business of the Parties or the
Services provided hereunder or performance of this Agreement, including without
limitation this Agreement, which is submitted or disclosed by one Party to the other
during the negotiation, Initial Term or any Subsequent Term of this Agreement shall be
treated as confidential and safeguarded by the receiving Patty to the same extent that such
Party safeguards its own confidential and proprietary data, and each Parry will use
reasonable measures and will supervise its personnel so as to prevent the disclosure of
such confidential information to third persons or sue of such confidential information
except in connection with the Services provided under this Agreement rop vided,
however, that all Parties may disclose Basic descriptions of the Services in connection
with the performance or marketing of the Parties' respective services. This Paragraph
shall not prevent or prohibit disclosure of any information required to be disclosed to any
Governmental Authorities pursuant to any Applicable Laws on or pursuant to lawful
subpoena or judicial order; provided, however, that before making such disclosure the
subject Parry shall tender to the other any opportunity, to be exercised at no cost or
expense to the tendering Parry, and/or CPS to defend against such compulsory disclosure.
34. This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one
and the same instrument.
35. This Agreement is contingent upon MEMO's review and approval of all
organizational documents and shareholder/officer agreements of Currency Direct, Inc.
Further a copy of all existing documentation, procedures, source code, and object code
will be held at the law office of Geoffrey B. Gompers, and be updated no less often than
quarterly,
36. MEMO and CDI represent that each has in the past been represented by
CDI's attorney in a number of matters. CBI's attorney has made full disclosure of such
representations to each, and had advised both MEMO and CDI that such representations
has and does create a conflict of interest and that both Parties would be better advised to
retain their own independent counsel. Each Party also understands that upon the
objection of either, CDI's counsel must and will withdraw from this representation. After
complete disclosure, and in the interest of saving time and in the interest of completing
this amicable Agreement, each has voluntarily and intelligently waived this conflict of
interest.
Agreement to establish "BILL PAYMENT SERVICE" Page 12 of 14
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
7TS EXPRESS MON RDER COMPANY
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Agreement to establish "BILL PAYMENT SERVICE" Page 13 of 14
Addendum A - Agreement to Establish "Bill Payment Service"
REIMBURSABLE EXPENSES
Salaries/Benefits/Taxes Associated with Payroll
Phone Costs (dedicated line for CPS use only)
Advertising Materials
Employee Expenses (Travel/Auto for CPS only)
Bank Fees
Third Party Processing Fees
Computer Equipment (with approval of Governing Committee)
Licensing Fees (CPS only)
Bonding Fees
Accounting Fees (billing hourly for CPS)
Marketing Expenses
Supplies for Resale
Computers for Resale
Programming Costs for system enhancements once system is fully operational
Printing
Interest Expenses
State Registration Fees
Attorney Fees (CPS incurred charges only)
Any other expense approved by majority vote of the Goveming Committee
Agreement to establish "BILL PAYMENT SERVICE" Page 14 of 14
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CUNNINGHAM & CHERNICOFF, P.C. 1; , .
10 - .
JUL - B 79919,
CONSUMER PAYMENT SERVICES, IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS, IN EQUITY
Defendants NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff/Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff/Petitioner and against
Defendants Currency Direct, Inc. ("CDI"), Defendant Neu-Direct,
Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff/Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a.
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
CDI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
C. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff /Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and in
operation through 11:59 p.m. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne Exeat.
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7. Release of either said Defendant Naveed Qureshi or tF
?aa
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
q
the amount of One Million Dollars ($1,000,000.00); and
3
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this Order; and
C. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff/Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
Jordan D. Cunningham, Require
For the Plaintiffa
H0M8\TLF\0RDBR8\M8M0-CDR.RRN
4
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
PETITION FOR RELIEF UNDER Pa R C P No 1529(0)
NOW COMES the Plaintiff /Petitioner, Consumer Payment
services, a division of Merchants Express money order Company, by
and through its attorneys, Cunningham & Chernicoff, P.C., and
petitions this Court on its behalf to find that the named
Defendants have failed to comply with the Order of Court dated
June 28, 1999, which provided certain injunctive relief in favor
of Plaintiff /Petitioner and against Defendant Currency Direct,
Inc. ("CDI"), Defendant Neu-Direct, Inc. ("NDI"), Defendant
Naveed Qureshi, and Defendant Nikos Valavanis, as more
particularly described herein, and to order arrest by attachment
of the said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and to order the sequestration of all property of the
said Defendant CDI, the said Defendant NDI, the said Defendant
Naveed Qureshi, and the said Defendant Nikos Valavanis,
respectively. The Plaintiff /Petitioner avers as follows:
THE PARTIES
1. Plaintiff, Consumer Payments services is a division of
Merchants Express Money Order Company (hereinafter referred to as
"CPS/MEMO"), a Pennsylvania corporation with a principal place of
business at 1029 Mumma Road, Wormleysburg, Cumberland County,
f
Pennsylvania. The business of Plaintiff CPS/MEMO includes, but
is not limited to, selling money orders and the collection of
money from customers and remittance of public utility payments.
2. Plaintiff possesses a license from the Pennsylvania
Department of Banking known as a money transmitter license.
3. Defendant, CDI is a Pennsylvania corporation with a
place of business at 10050 Roosevelt Boulevard, Philadelphia,
Philadelphia County, Pennsylvania.
4. Defendant, NDI is a Pennsylvania corporation with a
place of business at 8121 Old York Road, Suite 200, Elkins Park,
Montgomery County, Pennsylvania.
5. Defendant, Naveed Qureshi is an adult individual who
conducts business at 8121 Old York Road, Elkins Park, Montgomery
County, Pennsylvania.
6. Defendant, Nikos Valavanis, is an adult individual who
conducts business at 8121 Old York Road, Suite 200, Elkins Park,
Montgomery County, Pennsylvania.
7. Defendant, Naveed Qureshi, is the President of
Defendant, CDI, and, to the Plaintiff's belief, is an officer of
Defendant, NDI.
8. Defendant, Nikos Valavanis, is believed to be and
therefore averred to be an officer, agent or principal of
Defendant NDI and acts in concert with Defendant NDI and
Defendant CDI.
BACKGROUND
9. On October %, 1998, Plaintiff and Defendant, CDI
entered into that certain contract titled "Agreement to Establish
'Bill Payment Service'" (the "Agreement"). A true, correct and
complete photocopy of the Agreement is attached hereto, made part
hereof, and is incorporated herein by reference and marked
Exhibit "P-1". Plaintiff CPS/MEMO operates with the trade name
"Consumer Payment Services", whereby it facilitates consumers to
pay utility and other select types of invoices at various agent
locations. The agents of CPS/MEMO can arrange for bill payments
on behalf of consumers by means of certain computer software
licensed under the Agreement by Defendant CDI to Plaintiff
CPS/MEMO. The Agreement declares that CPS/MEMO holds an
exclusive license to use the Bill Payment System software. The
"Consumer Payment Services" business of Plaintiff CPS/MEMO
averages approximately Two Hundred Twenty Thousand Dollars
($220,000.00) in gross collections per calendar day. The bill
payment services are offered by agents of Plaintiff CPS/MEMO all
days, including weekends and holidays, when said agents' premises
are open for business to consumers.
10. In May, 1999, CPS/MEMO received information, and
therefore avers, that Defendant Naveed Qureshi, acting in his
capacity as President of Defendant, CDI, traveled to Minneapolis,
Minnesota, where he represented to one or more entities that
Defendant, NDI owns, has full rights regarding, and is not
restricted as regards, any use or licensing of the "Bill Payment
System" software program licensed by CDI to CPS/MEMO under
Section 5(c) of the Agreement.
11. Plaintiff, since April, 1999, has received information,
and therefore is of the belief, that Defendants, Naveed Qureshi,
Nikos Valavanis, and CDI, have violated a number of the
3
,
provisions of the Agreement in that the three said Defendants
have attempted to market the "Bill Payment System,, software in
violation of the Agreement.
12. Under the terms and conditions of the Agreement,
Plaintiff, CPS/MEMO, was to pay all monthly obligations owed
under the Agreement to Defendant, CDI.
13. Plaintiff, CPS/MEMO, is of the belief, and therefore
avers, that Defendants, Naveed Qureshi, Nikos Valavanis, and CDI
violated a number of the provisions of the Agreement in that,
inter alia, the "Bill Payment System" software has never been
fully operational and does not approach acceptable levels of
performance; and that Defendant, CDI's processor, Defendant, NDI,
has submitted invoices asserting out-of-pocket expenses for
reimbursement that otherwise should have been made by CDI.
14. On May 20, 1999, Plaintiff, CPS/MEMO, paid the monthly
obligation owed for April, 1999 under the Agreement to Defendant,
CDI.
15. Defendant, Naveed Qureshi caused Defendant CDI to
refuse to negotiate the April, 1999 check.
16. On May 28, 1999, Defendant, NDI intercepted and voided
the said check issued by Plaintiff, CPS/MEMO, to Defendant, CDI,
and demanded direct payment of the April, 1999 obligation to
Defendant, NDI.
17. Initially, Plaintiff, CPS/MEMO, refused the demand of
Defendant, NDI, to pay the April, 1999 obligation to Defendant,
NDI.
4
18. Between May 28, 1999 and June 13, 1999, several
discussions regarding the issue of payment of the April and May,
1999 obligations were held between Plaintiff, CPS/MEMO, and
Defendants, Naveed Qureshi and Nikos Valavanis.
19. On June 14, 1999, and without notice, Defendant, NDI,
and its officers or agents, Defendants, Naveed Qureshi and Nikos
Valavanis, changed the password to the customer service modular
of the "Bill Payment System" software, in effect shutting down
CPS/MEMO operations.
20. As the result of said change to the password to the
software, various vendors' bills and utility bills would not have
been paid or honored, thus subjecting utility customers to
potential shut-off.
21. On June 14, 1999, Defendant, Nikos Valavanis, an
officer of Defendant, NDI, declared to employees of MEMO that
unless monies were directly wired to NDI for payment of services,
instead of to Defendant, CDI, that the password to the customer
service modular of the "Bill Payment System" software would be
changed, thus placing Plaintiff's operations out of business.
22. On June 14, 1999, Plaintiff, CPS/MEMO, in reaction to
the demand made by the Defendants, Naveed Qureshi, Nikos
Valavanis, and NDI, wire transferred the April and May, 1999
obligations owed to Defendant, CDI, to the account of Defendant,
NDI.
23. On June 14, 1999, Defendant, NDi, restored the
operation of the "Bill Payment System" software upon confirmation
of the receipt of funds.
5
24. As a result of the disputes between Plaintiff CPS/MEMO
on the one hand, and the four Defendants on the other hand,
regarding provision of services under the Agreement, and because
the actions of the Defendants had already worked injury upon
Plaintiff CPS/MEMO, and because, unless enjoined, actions of the
Defendants would result in further waste, diminution and
conversion of the Plaintiffs assets, as well as placing
Plaintiff in the position that it might default under various
contracts with third parties, Plaintiff commenced this action in
equity on June 24, 1999 by means of its verified Complaint.
25. On June 24, 1999, this Honorable Court entered its
certain Order in the form of preliminary injunction. Said Order
enjoined the Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis from changing the password to the consumer service
module of the "Bill Payments System" software or, in any way
putting into place a security system that would disable or impede
the Plaintiff /Petitioner from using the "Bill Payment System"
software envisioned by the Agreement. Attached hereto as Exhibit
"P-2" is a true, correct and complete photocopy of the said Order
in the form of preliminary injunction.
26. Process server Boyd A. Preslin served copies of the
said Order dated June 24, 1999, and the Petition for Preliminary
Injunction that had sought same on Defendant CDI by hand delivery
to Edward Haluska, an officer of said Defendant, CDI, on June 25,
1999.
27. Process server Boyd A. Preslin served copies of the
said Order dated June 24, 1999, and the Petition for Preliminary
Injunction that had sought same, on Defendant NDI by hand
delivery to Naveed Qureshi, an officer of said Defendant, NDI,on
June 25, 1999.
6
28. Process server Boyd A. Preslin served copies of the
said Order dated June 24, 1999, and the Petition for Preliminary
Injunction that had sought same, by hand delivery to Defendant
Naveed Qureshi, on June 25, 1999.
29. Process server Boyd A. Preslin served copies of the
said Order dated June 24, 1999, and the Petition for Preliminary
Injunction that had sought same, on Defendant Nikos Valavanis by
hand delivery to Naveed Qureshi, the agent or person in charge of
Defendant Nikos Valavanis' office or usual place of business, on
June 25, 1999.
30. The Affidavit of Service regarding the service
described above in Paragraphs 26 through 29, inclusive, was filed
with the Office of the Prothonotary on June 28, 1999.
31. The said Order dated June 24, 1999, set a "show cause"
hearing for June 28, 1999, commencing at 1:30 p.m. in Courtroom
No. 5, Cumberland County Courthouse, Carlisle, Pennsylvania. At
the date and time set for said hearing, no Defendant appeared,
and no attorney made an entry of appearance for any of the four
Defendants.
32. On June 20, 1999, this Honorable Court entered its
certain Order of Court declaring that the preliminary injunction
issued on June 24, 1999 shall remain in full force and effect
until further order of Court. Attached hereto as Exhibit "P-3"
is a true, correct and complete photocopy of the said Order of
Court (the "Injunction").
33. Plaintiffs counsel served a copy of the Injunction on
Defendant NDI, Naveed Qureshi and Nikos Valavanis by means of
confirmed fax transmittal on June 28, 1999.
7
34. Plaintiff's counsel served copies of the Injunction on
Defendant CDI by means of confirmed fax transmittal on June 30,
1999.
THE THREATS
- 35...On Thursday.. morning,.July 1,-1999, Defendant Nikos
Valavanis telephoned the Office of Ken Augustine, Research and
Development Manager of Plaintiff CPS/MEMO. Mr. Valavanis stated
that he would shut down the business operations of Defendant NDI
and of Defendant CDI unless Defendant NDI was awarded the full
bill payment business of a certain participating agent known as
Currency One. Mr. Valavanis stated that if he did so shut down
the business operations of Defendant NDI and Defendant CDI, both
the Agreement and the Injunction would be "worthless". Defendant
Nikos Valavanis further stated that if he so chose to shut down
said businesses "no one could do anything about it". During the
course of the conversation, Defendant Nikos Valavanis stated that
his.personal assets and.the,assets of Defendant Naveed Qureshi
are or would be in another country and that the Plaintiff
CPS/MEMO would not be able to access those assets. During the
course of the conversation Defendant Nikos Valavanis stated that
he would lay off and terminate all employees of Defendant NDI and
shut down that company's operations, which in turn would shut off
the bill payments service offered and conducted by Plaintiff
CPS/MEMO.
36. The said telephone conversation of July 1, 1999 is
further memorialized in the Affidavit of Ken Augustine, attached
hereto as-Exhibit""P-4"
37. Plaintiff CPS/MEMO believes, and therefore avers, that
Defendant Naveed Qureshi and Defendant Nikos Valavanis keep,
maintain or have located assets outside of the United States of
America.
8
,
38. Defendants CDI, NDI, Naveed Qureshi and Nikos Valavanis
have access to the bank account of Plaintiff /Petitioner CPS/MEMO
that is the depository of money received from consumers who
purchase the bill payment services offered by Plaintiff CPS/MEMO.
39. Plaintiff/Petitioner CPS/MEMO believes, and therefore
avers, that each of Defendant Naveed Qureshi and Defendant Nikos
Valavanis have significant ties to foreign countries.
i
40. Plaintiff/Petitioner CPS/MEMO believes, and therefore
avers, that each of Defendant Naveed Qureshi and Defendant Nikos
Valavanis previously have traveled outside of the United States
of America.
THE DEFENDANTS' ACTIONS IN VIOLATION OF THE
INJUNCTION ISSUED BY THIS COURT
41. At approximately 10:45 a.m. on Tuesday, July 6, 1999,
the Plaintiff, CPS/MEMO, attempted, via modem, to log onto the
customer service module of the Bill Payment system software
licensed by CDI to CPS/MEMO. No connection was achieved.
Plaintiff CPS/MEMO attempted, via modem, to log on by means of
other telephone lines. All attempts were unsuccessful.
42. At approximately 11:00 a.m. on Tuesday, July 6, 1999,
Ken Augustine received a telephone call from Defendant Nikos
Valavanis. During the course of that telephone conversation, Mr.
Valavanis announced:
(a) He had closed down the business of Defendant, NDI;
(b) He had laid off all seven employees of Defendant,
NDI, including but not limited to Nikos Valavanis, Naveed
Qureshi, and, Plaintiff /Petitioner has reason to believe, four
family members of said individual Defendants;
9
(c) Defendant, NDI, must have in writing an agreement
with Plaintiff CPS/MEMO concerning payments processing and
licensing fees before Plaintiff may utilize the Bill Payment
Service software licensed to Plaintiff CPS/MEMO by Defendant CDI
under the Agreement; and
(d) In a very short time all sales agents of Plaintiff
CPS/MEMO will not be able to log onto the Bill Payment System
software program.
43. CPS/MEMO agents are not able to log onto the Bill
Payment System software program.
44. The closure of Defendant NDI effectively closes down
the business of Defendant CDI.
45. At approximately 11:10 a.m. on Tuesday, July 6, 1999,
Kelly Billstone, Accounts Manager for Plaintiff CPS/MEMO,
telephoned Defendant Nikos Valavanis and spoke with him. Ms.
Billstone asked whether Defendant NDI intends to process the
consumer payments made over the immediately prior holiday
weekend. Defendant Nikos Valavanis stated that Defendant NDI
does not have any such intent and, in response to another
question posed by Ms. Billstone, that he does not care about any
individuals who might have their electricity shut off by virtue
of a non-remittance of payments submitted to CPS/MEMO agents over
the past weekend.
46. It is believed and therefore averred, that
approximately fifteen thousand (15,000) consumer payments were
made to CPS/MEMO agents over the Independence Day holiday weekend
and that approximately fifty percent (50t) of such payments are
payable to Philadelphia Electric Company (PECO).
10
47. Each of Defendants NDI, Naveed Qureshi, and Nikos
Valavanis have and, on July 6, 1999, had the power and ability to
cause the events described above in Paragraphs 41 through 45,
inclusive.
48. Plaintiff/Petitioner believes, and therefore avers,
that Defendants NDI, Naveed Qureshi and Nikos Valavanis caused to
occur the events described above in Paragraphs 41 through 45,
inclusive.
49. Defendants NDI, Naveed Qureshi and Nikos Valavanis
cause occurrence of the events described above in Paragraphs 41
through 45, inclusive, voluntarily, intentionally, maliciously,
and with specific intent to harm, and in fact thereby did harm,
the business, operations, property, and other interests of
Plaintiff/Petitioner CPS/MEMO.
50. As a result of the occurrences described above in
Paragraphs 41 through 45, inclusive:
A. Approximately 15,000 consumers will be at risk as
regards timely and full remittance of consumer bill payments, a
substantial number of which may implicate provision of electric
service to their residences and use of air conditioners in the
current heat wave;
B. Plaintiff /Petitioner CPS/MEMO likely will have its
Consumer Payment Services operations put out of business unless
CPS/MEMO is successful in implementing and operating an Ad hoc,
untested, substitute system in place of the software licensed by
Defendant CDI to Plaintiff under the Agreement, and which
licensed software has been rendered inoperable by the actions of
Defendants NDI, Naveed Qureshi and Nikos Valavanis;
11
C. Plaintiff /Petitioner is or will be unable to
verify if a consumer payment was processed correctly, which could
result in utility service being interrupted for consumers;
D. Plaintiff/Petitioner will be unable to reconcile
and settle its bank account;
E. Plaintiff /Petitioner will lack access to payment
history generated prior to any switch over to new software, which
could result in CPS/MEMO being unable to provide customer service
to agents or consumers;
F. Plaintiff/Petitioner must make significant
modification to the software utilized at the agent locations, and
must scramble to put into place even a very basic version of
"back room" processing software to process/route payment and to
provide a minimal amount of consumer service; and
G. Plaintiff/Petitioner must dedicate substantial
resources to software programming, and incur related expenses, in
order to expedite a permanent solution to the lack of the
software licensed to CPS/MEMO under the Agreement.
51. Approximately thirty percent (30W) of the monthly bill
payment volume occurs during the first few days of each calendar
month, coinciding with due dates for consumer bills, issuance of
Social Security payments, issuance of other governmental checks
and a large number of payrolls being processed at the end of the
immediately preceding calendar month.
52. Defendants NDI, Naveed Qureshi, and Nikos Valavanis
have access to the bank accounts of Plaintiff /Petitioner CPS/MEMO
and its agents, respectively, notwithstanding the occurrences
described above in Paragraphs 41 through 45, inclusive.
12
53. Relief under Pa. R.C.P. No. 1529(b) is not a meaningful
alternative for Plaintiff /Petitioner because no county's
Prothonotary or Sheriff can perform under the Agreement or comply
with the Injunction on behalf of Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis. Sequestration of assets alone is
not an adequate remedy for the above-described occurrences,
defaults, and violations of the Injunction.
54. The status quo as existed immediately before the
occurrences described above in Paragraphs 41 through 45,
inclusive, cannot be preserved. Unless Defendants NDI, Naveed
Qureshi and Nikos Valavanis are compelled to undo the occurrences
described above in Paragraphs 41 through 45, inclusive, the
Plaintiff's Consumer Payment Services business will be lost.
55. Plaintiff/Petitioner has no adequate remedy at law to
redress the current and impending harm from the above-described
conduct of the Defendants NDI, Naveed Qureshi and Nikos
Valavanis. The destruction of the Plaintiff's business by said
action is not re-dressable by monetary damages. Arrest by
attachment of Defendants Naveed Qureshi and Nikos Valavanis, and
sequestration of their respective assets, is the most appropriate
means to restore the Agreement's parties CDI and CPS/MEMO to
where they were before Defendants' wrongful conduct began.
Defendants will remain able to pursue their respective legal
rights and remedies in a lawful manner.
REQUEST FOR RELIEF
WHEREFORE, Plaintiff /Petitioner prays that his Honorable
Court:
A. Find and declare Defendants CDI, NDI, Naveed
Qureshi, and Nikos Valavanis in civil contempt of the Injunction;
and
13
B. Order steps to cure all violations of the
Injunction;
C. Order arrest by attachment of Defendant Nikos
Valavanis and Defendant Naveed Qureshi by writ Ne Exeat; and
D. Order sequestration of the assets of Defendant
Naveed Qureshi and of Defendant Nikos Valavanis, respectively;
and
E. Direct the Sheriff and any and all Deputies of
Cumberland County, Pennsylvania to deputize any and all Sheriffs,
Deputies, State Constables, and Police in any jurisdiction for
the purpose of arresting by attachment the said persons Defendant
Naveed Qureshi and Defendant Nikos Valavanis and for the purpose
of the sequestration of their respective assets; and
F. Declare that any release from the said arrest by
attachment and the said sequestration of assets is conditioned
upon posting of cash bond or equivalent in the amount of One
Million Dollars ($1,000,000.00) in form and security satisfactory
to the Court, as well as upon cure of all defaults and damages
caused by the occurrences described above in Paragraph 41 of this
Petition, and upon payment to Plaintiff /Petitioner CPS/MEMO of
costs and attorneys fees in an amount not less than $3,000.00 in
immediately available funds; and
14
G. Grant such other and further relief as is just and
appropriate.
Date: July 6 ,
N0Me\TLP\M1TI0N\M9M0
1999
Respectfully submitted,
CUNNINGHAM & CHERNICOFF, P.C.
By: /1AL?- Lt 1, Gtr., ?-,
Jordan D. Cunningham, E/gq ire
Attorney Id. No. 23144 \
Marc W. Witzig, Esquire
Attorney Id. No. 29929
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
(717) 238-6570
Attorneys for
Plaintiff/Petitioner
Consumer Payment Services, a
division of Merchants Express
Money Order Company
15
AGREEMENT TO ESTABLISH "BILL PAYMENT SERVICE"
RECITALS
THIS Agreement made this 7>4 day oflt>jd", 1998, by and between
CONSUMER PAYMENTSSERICES, a division of MERCHANTS EXPRESS
MONEY ORDER COMPANY, a Pennsylvania Corporation with a place of business at
1029 Mumma Road, Wormleysburg, PA 17043 (hereinafter "MEMO") and
CURRENCY DIRECT, INC. ("CDI"), a Pennsylvania Corporation, with a place of
business at 10050 Roosevelt Blvd., Philadelphia, PA 19114.
WHEREAS, a substantial and growing market exists for "Bill Payment Services"
to be provided to consumers through agent locations; and
WHEREAS, CPS, through a division of MEMO to operate with the trade name,
"Consumer Payment Services: (hereinafter, "CPS"), desires to enter this Agreement
(hereinafter "Agreement") with CDI for the provision of those services; and
WHEREAS, CDI desires to enter into this Agreement with CPS, for the provision
of those services; and
WHEREAS, CPS has the necessary expertise, the necessary licenses, a substantial
agent base, and marketing staff; and
WHEREAS, CDI has the appropriate computer knowledge, software applications,
networking capabilities and communications expertise.
NOW, THEREFORE, the Parties, intending to be legally bound, agree to enter
into the Agreement under the following terms and conditions.
AGREEMENT
1. The purpose of this Agreement is to establish an independent contracting
agreement between the Parties to permit consumers to pay utility and other select types of
invoices (hereinafter "Bills") at various agent locations (hereinafter "Agent'), and to _
establish a procedure for the profit of the Parties whereby agents can make Bill Payments
to vendors via computer software developed and owned by CDI. a
2. CPS and CDI acknowledge that the Bill Payment System ("System") software E
developed by CDI to implement a Bill Payments Service, may require further x
clarifications and modifications as the procedures and regulations applicable to Bill rra
Payments and Electronic Payments ("El's") are developed or changed. To that end, CPS
and CDI shall cooperate with each other in good faith, each use its best efforts, and shall
Agreement to establish "BILL PAYMENT SERVICE" Page I of 14
generally share, subject to the confidentiality requirements imposed under this
Agreement, any information that reasonably may be required by the other Party, with the
goal of ensuring the successful development and implementation of the Bill Payment
Services Program.
3. MEMO agrees to establish a separate operating division known as Consumer
Payment Services (hereinafter "CPS"), a division of Merchants Express Money Order
Company, a Pennsylvania Corporation." MEMO will set up separate books and records
for said division, and will keep all activities of this division separate and apart from its
other business operations. MEMO will file the appropriate fictitious name certificate
applications for CPS. CPS will not have any full or part-time employees unless agreed to
by the Parties, but rather its activities will be conducted either on a contract basis, or on
the basis where PIMA, CDI, Westside Check Cashing Inc. or Neu Direct employees will
perform services for CPS, subject to the approval of the Governing Committee (as
hereinafter defined), and shall be reimbursed for said services by CPS.
4. The Parties acknowledge that, in certain states in which MEMO operates,
MEMO is licensed through one or more subsidiaries, currently MEMO Money Order
Company and MEMO - New York. At such time as the business expands into these
states, MEMO will cause its subsidiary(s) to fort a division, "Consumer Payment
Services", and this division will operate the bill payment service in the same manner as
CPS operates as a division of Merchants Express Money Order Company. Financial
Reports for all CPS divisions will be combined. Both Parties acknowledge that the name
"Consumer Payment Services" may not be clear in all states, and the service may operate
subject to the conditions of this contract under an agreed upon alternate name in those
states.
S: Subject to the terms and conditions set forth below, in connection with the Bill
Payment Services Program, CDI and CPS shall at all times during the Initial Term and
any Subsequent Term of this Agreement provide, render and perform the services
necessary to implement and operate the Bill Payment Services Program. Specifically, the
Parties shall provide services to CPS as specified below:
A. CPS and CDI agree that CPS shall supervise and direct the day to day
management and operation of CPS's ordinary and usual business affairs, subject to the
instructions, guidance, and directions of a "Governing Committee which shall at all times
be composed of two members selected by CDI and two members selected by MEMO.
B. MEMO agrees to use its best efforts to market and distribute on behalf
of CPS and to do all things reasonable to fully promote and support CPS and its business
objectives.
C. CDI agrees to make available for the exclusive use by CPS in is
business operations a certain "Bill Payment Services" software program including certain
data processing services. The attributes of the System, as currently developed, are
Agreement to establish "BILL PAYVE1VT SERVICE" Page 2 of 14
defined in Appendix A hereto. It is understood and agreed by the Parties that CPS shall
compensate CDI for enhancements to the System later developed in accordance with
expense reimbursement procedures outlined in 8A. These enhancements shall be over
and above the fully operational system as reported by CDI prior to system rollout
D. CDI will provide the System at a fully operational stage, as defined by
the governing committee. (See Appendix A for Current Operational Stage). CDI agrees
to maintain, develop, improve, and/or innovate the System to meet the continual
operational, regulatory, or competitive demands of the business. The cost of such
maintenance, development, improvement and/or innovation will be funded by CPS out of
CPS fees under expense reimbursement guidelines outlined in 8A. In the event that the
Governing Committee by majority vote declares that CDI cannot timely or cost
effectively complete such maintenance, development, improvement and/or innovation, or
any part thereof, CPS and/or MEMO will have the full authority to contract with and/or
employ vendors/staff necessary to perform the functions.
1. CDI wan-ants that it has the legal right to grant to CPS the exclusive
use as set out in Paragraph 5(C) of this Agreement and that such license does not infringe
upon any third Party's property or personal rights.
2. CDI warrants there are no lawsuits pending or threatened contenting
CDI's rights to license and use the System, and that the System has not been published in
such a way as to lose any of its copyright or Patent protections.
3. CDI will have a qualified Patent/Copyright Attorney review all
components of the System, including software to the best of the Patent/Copyright
Attorneys opinion and after a diligent search render a written opinion that the System,
including software does not infringe upon any patent, copyright, trade secret, or other
property rights of a third Party. Further, this attorney should also render an opinion of
whether CDI would be reasonably advised to Patent or apply for Copyright protection.
4. CPS agrees to provide marketing, licenses, customer service,
management, general accounting services, record keeping and reporting services as may
be required and shall receive payment in accordance with Paragraph 8A. CPS, shall
collect monies from the agents, hold receipts and shall make appropriate disbursements
for Bills at such times as required. The Parties acknowledge that MEMO and its
subsidiaries and divisions are subject to accounting and reporting rules under GAAP,
state banking regulations, etc., and that these rules require strict adherence to certain
accounting and reporting standards in the conduct of its business. The Parties agree that
accounting and reporting for CPS will conform to any and all accounting, reporting, etc.,
standards which otherwise apply to MEMO. CDI will make all software changes
necessary for CPS to efficiently and accurately provide these services, and shall receive
payment in accordance with Paragraph 8A.
Agreement to establish "BILL PAYMENT SERVICE" Page 3 of 14
5. MEMO agrees to maintain separate books and records for CPS and to
conduct CPS at all times as a separate division of MEMO. MEMO shall keep accurate,
full, and complete books and accounts shooing the assets, liabilities, operations,
transactions, and financial condition of CPS. Such books and records shall be kept at
MEMO's principal office and/or at a suitable off-site storage area. CPS shall operate on a
fiscal year ending June 30. Monthly financial statements for CPS shall be prepared by
MEMO and provided to all Parties. On or before September 15 of each year, CPS shall
provide to the Parties annual financial statements.
6. Unless otherwise agreed to by all Parties, both Parties shall provide at no cost
to CPS general consulting services from time to time as the need arises. Each Party will
have various computer hardware at its location in order to provide services for CPS. This
equipment must not be encumbered in anyway or used as collateral for any other business
venture of either Party or affiliated companies.
7. MEMO or CPS with the majority approval of the Governing Board, may hire,
fire, promote, demote employees or contract with other providers of services as
necessary. Costs will be paid subject to Expense Reimbursement Guidelines.
8. The Parties shall receive fees and expense reimbursements as follows:
A. Each Party shall be reimbursed for reasonable and necessary expenses
as approved by the Governing Committee and reimbursement shall generally occur on or
about the 20th day of each month provided all invoices are submitted to CPS no later than
the 5th of each month. Each Party will provide vendor invoices for all out pocket
expenses to be reimbursed. In the event that there is insufficient revenue to cover these
expenses, the Parties will be reimbursed as much as possible.
B. Each Party shall receive a fee of five cents ($.05) per transaction for its
contribution to CPS, provided that sufficient revenue was generated to cover this
distribution. This fee shall be paid monthly at the same time as expense reimbursement.
In the event that there is insufficient revenue to fund these fees, there will be either a pro
rata distribution or no distribution.
C. Additional fees may, with majority approval of Governing Board, be
paid to each Party as independent contractors for consulting services as specified above
under this Agreement. Such additional payments (hereinafter "Commission
Compensation") shall be paid quarterly (as of the end of March, June, September, and
December) on or before the 20th of the month next following the month in which each
calendar quarter ends. Commission Compensation shall be determined on an accrual
basis by taking into account the net income of the operations of CPS, which shall mean
actual gross revenues less reimbursements, operating expenses and bad debt accruals of
CPS, and shall equal Fifty Percent to each Party of the income of the operations of CPS.
Additionally„ if the Governing Committee agrees to operating losses as defined by
Agreement to establish "BILL PAY.'K£NT SERVICE" Page 4 of 14
distributed financial statements, eacE Party shall reimburse CPS Fifty Percent (50%) of
such losses within twenty (20) days of being notified.
D. No later than July 1, 2000, the revenue sharing will be converted from
a profit sharing to a per item fee for each party. Profits and costs of each party will be
analyzed with the end result being that each party will net the same profit per item as they
would have under the initial revenue sharing agreement.
9. The Parties agree that during the term of this agreement including any
renewals, and, for a period of one (1) year following the termination of this Agreement,
neither Party shall conduct or operate any business in direct or indirect competition with
CPS unless specifically agreed to in writing by both Parties, except as stated in Paragraph
14. This restriction shall not prohibit any Party from pursing any other business venture
which does not compete with CPS. This does not prohibit either Party from continuing
the business in the case of a default cited in Paragraph 14. However, this restriction shall
prevent the officers of either Party from the following activities:
P::. Engaging as an officer, employee, partner, employee shareholder, or
any other capactiy, in any business in competition with any business then being
conducted by CPS at the time this Agreement is signed;
.B. Requesting any customers of any business then being conducted by
CPS to curtail or cancel their business with CPS;
C. Disclosing to any person, firm or corporation any trade secrets, any
details of organization or business affairs of CPS, MEMO and/or CDI, as well as any
names of past or present customers of any of them, or any other information relating to
the business operations of CPS, from time to time certain non-proprietary information
regarding CPS may be used to further marketing efforts. Due diligence shall be exercised
by either Party while discussing CPS Operations with third Parties;
D. Inducing, or attempting to influence, any employee of CPS to
terminate employment with the CPS or to enter into any employment or other business
relationship with any other person, firm or corporation.
E. Acting or conducting itself in any manner which may reasonably be
believed to be harmful or contrary to the best interests of CPS.
The Parties recognize that immediate and irreparable damage will result to CPS if ,
either breaches any of the terms and conditions of this Section and, accordingly, each
hereby consents to the entry by any Court of competent jurisdiction of an injunction
against itself to restrain any such breach, in addition to any other remedies or claims for
money damages which the CPS may seek.
Agreement to establish "BILL PAYMENT SER PKE" Page 5 of 14
10. The Agreement shall not be deemed to create a partnership orjoint venture
among the Parties. The relationship is defined and understood as a contract among
independent contractors, and no action shall be deemed to bind other Parties except to the
extent, if any, as defined in this Agreement. At no time during this Agreement will CDI
acquire any capital, equity, profits or other interest in any entity owned by or affiliated
with Pennsylvania Food Merchants Association, the parent of MEMO, or MEMO itself.
11. The initial Term of the Agreement shall be Fifteen (15) years unless sooner
terminated by the Default (as defined below) of either Parry. The Agreement shall
automatically renew for successive five (5) year periods following the end of the initial
term unless one hundred eighty (180) days written notice is provided by the Party
desiring termination. In the event of termination, the Party not initiating the termination
shall have a right of first refusal to continue to operate the business under the CPS' name
and shall have access to software (including source code) or agent information as the case
may be. The Party continuing the business shall compensate the other Party for the
provision of agents or software, as the case may be, at a value to be determined by an
independent appraisal. Each Party will pick an appraiser, and these two (2) appraisers
will pick a third appraiser who will conduct an independent appraisal to determine the
volue.of CPS. The Party continuing CPS's service(s) will compensate the other Party
fifty (50) percent of the value in equal monthly payments over a period not to exceed a
twenty four (24) month period. The payments will be restricted to the actual value of the
service with no interest. The terminating Party shall be prohibited from providing agent
information or software or information about the nature, structure, or operation of the
business, as the case may be, to any person and/or entity for the time period in which the
Party continuing the business does actually continue the business. In the interest of not
losing existing agent base (if CDI were to continue business) CDI must make provisions
to convert agents within one hundred eighty (180) days of CPS' default. All Parties
acknowledge that all Money Transmitter Licenses owned by MEMO or its subsidiaries
cannot be transferred, assigned or sold to CDI or any other entity under any circumstance.
In the event that either Westside Check Cashing, Inc. 's Majority Stockholder (Mike
Carlone) or Neu Direct's Majority Stockholder (Naveed Qureshi) are no longer affiliated
with CDI, MEMO will have the right to approve or disapprove any nominations to the
Goveming Committee by CDI.
12. This Agreement may be terminated for cause ("Termination for Cause") by
either Party upon delivery of written notice of the intention to terminate and the cause for
such termination to the other Party not less than 30 days after delivery of such notice
("Termination for Cause Date") unless the receiving Party cures prior to the Termination
for Cause Date. For purposes of this Paragraph "cause" shall mean illegal acts, willful
misconduct, actual fraud or the occurrence of other Events of Default as defined
hereinafter. Upon termination the grieving Party will assume operation of CPS, and shall
buy out defaulting Party in accordance with terms in Paragraph 11.
Agreement to establish "BILL PAYMENT SERVICE" Page 6 of 14
I 3. Effect of Termination Except to the extent otherwise provided in this
Agreement, upon termination of this Agreement, the obligations of the Parties shall cease.
14. Events of Default An "Event of Default shall mean the occurrence or
existence of one or more of the following events or conditions (whatever the reason for
such Event of Default and whether voluntary, involuntary or effected by operation of
law):
(A) Either Party fails to perform in a reasonably timely manner any material
obligation under this Agreement;
(B) Any representation or warranty made by either Party under this Agreement or
any financial statement, certificate, report, exhibit or document required to be furnished
pursuant to this Agreement shall prove to be materially false or intentionally misleading
in any material respect as of the time when made (including by omission of material
information necessary to make such representation, warranty or statement not
misleading);
(C) Either Party shall default in the performance or observance of any covenant,
agreement or duty under this Agreement and such default shall have continued for a
period of 30 days after notice of such default;
(D) Any material adverse change in either Party's business, operations, condition
(financial or otherwise), properties, assets, or prospects shall occur;
(E) One or more judgments for the payment of money shall have been entered
against either Party, or principles of either Party which judgment or judgments shall have
remained undischarged, or unappealed, or unstayed for a period of 90 consecutive days
after notice of the same.
(F) A proceeding shall have been instituted in respect of either Party (1) seeking
to have an Order for relief entered in respect to such Party, or seeking a declaration or
entailing a finding that such Party is insolvent or a similar declaration or finding, or
seeking dissolution, winding up, charter revocation or forfeiture, liquidation,
reorganization, arrangement, adjustment, composition or other similar relief with respect
to such Party, its assets or its debts under any law relating to bankruptcy, insolvency,
relief of debtors or protection of creditors, termination of legal entities or any other
similar law now or hereafter in effect, or (2) seeking appointment of a receiver, trustee,
custodian, liquidator, assignee, sequestrator or other similar official for such Party or for
all or any substantial part of its property; or
(G) Either Party shall become insolvent, shall become generally unable to pay its
debts as they become due, shall voluntarily suspend transaction of its business, shall
make a general assignment for the benefit of creditors, shall institute a proceeding
described in Paragraph 14(F) above, or shall consent to any order, declaration, or finding
Agreement to establish "BILL PAYMENT SERVICE" Page 7 of 14
for relief described therein, or shall consent to any such appointment or to the taking of
possession by any such official of all or any substantial part of its property, shall dissolve,
windup, revoke or forfeit its chatter (or other constituent documents) or liquidate itself or
any substantial part of its property, or shall take any action in fiutherance of any of the
foregoing.
15. If any Event of Default listed in the preceding section shall occur or continue
to exist, the non-defaulting Parry may exercise one or more of the following remedies:
(A) Terminate this Agreement upon notice to the defaulting Party in accordance
with the preceding paragraphs of this Agreement, including, but not limited to Paragraph
11;
(B) Take such other action as may be permitted by applicable law.
(C) Continue to run CPS on a day to day basis so as not to place the service in
jeopardy to existing agents.
16. The Parties' remedies under this Agreement are non-exclusive and
cumulative; and each may be exercised separately, concurrently with any other remedy or
in any order or manner permitted under Applicable Laws, and without the need to exhaust
any other remedy provided hereunder. The provisions if this Paragraph 16 shall survive
termination of this Agreement, and shall continue indefinitely.
17. Any controversy or claim arising between the Parties and relating to the
Agreement, shall be resolved by binding arbitration. This Agreement to arbitrate shall
continue in frill force and effect despite the expiration or termination of this Agreement.
All arbitrations shall be undertaken pursuant to the Rules of the American Arbitration
Association, and the decision of the arbitrators shall be final and enforceable in any court-
of competent jurisdiction absent actual fraud. The Parties knowingly and voluntarily
waive their rights to have their dispute adjudicated by a judge or jury. The arbitrator shall
apply the law of the Commonwealth of Pennsylvania and the arbitration shall be held in
the defending Parry's area (Philadelphia County for CDI; Dauphin County for CPS).
18. Any Party may demand arbitration by sending written notice to the other
Parry. The arbitration and the selection of arbitrator(s) shall be conducted in accordance
with such rules as may be agreed upon by the Parties, or failing Agreement within thirty
(30) days after arbitration is demanded, under the commercial Arbitration Rules of the
American Arbitration Association ("AAA"), as such rules may be modified by this
Agreement. In any dispute which involves more than $100,000.00 in damages, three
arbitrators shall be used. Unless the Parties agree otherwise, they shall be limited in their
discovery to relevant documents. Responses or objection to a document request shall be
served within twenty (20) days after receipt of the request. The arbitrator(s) shall resolve
any discovery disputes. CPS must continue to operate in the interim.
Agreement to establish "BILL PAYMENT SERVICE" Page 8 of 14
19. The arbitrator(s) shall have the authority to award actual money damages
(with interest on the unpaid amounts from the due date), specific performance, and
temporary injunctive relief, but the arbitrator(s) shall not have the authority to award
exemplary, punitive, or consequential damages, and the Parties expressly waive any
claimed right to such damages. The costs of arbitration, but not the costs and expenses of
the Parties, shall be shared equally among the Parties. If a Party fails to proceed with
arbitration, unsuccessfully challenges the arbitration award, or fails to comply with the
arbitration award, the other Party is entitled to costs, including reasonable attorney's fees,
for having to compel arbitration or defend or enforce the award. Except as otherwise
required by law, the Parties and the arbitrator(s) agree to maintain as confidential all
information or documents obtained during the arbitration process including the
resolution of the dispute.
20. All notices required or permitted hereunder shall be in writing and shall be
served to the following address:
Consumer Payment Services
Merchants Express Money Order Company
1029 Mumma Road
Wormleysburg, PA 17043
Currency Direct, Inc.
10050 Roosevelt Blvd.
Philadelphia, PA 19114
21. In the event that any term or provision of the Agreement or any application
thereof to any person or circumstances shall be declared prohibited, invalid, or
unenforceable to any extent in any jurisdiction, as determined by a court of competent
jurisdiction, such term or provision shall, in that jurisdiction, be ineffective only to the
extent of such prohibition, invalidity, or unenforceability, or as applied to such persons or
circumstances, without invalidating or rendering unenforceable the remaining term or
provisions hereof or affecting the validity or enforceability of such term or provision in
any other jurisdiction or as to other persons or circumstances in such jurisdiction.
22. This Agreement shall be governed exclusively by the laws of the
Commonwealth of Pennsylvania.
23. This Agreement contains all the agreements between the Parties regarding the
subject matter hereof and may not be modified orally or in any manner other than by
Agreement in writing signed by the majority of members of the Governing Committee.
24. This Agreement is intended solely for the benefit of the Parties hereto and no
covenant or the provision herein shall create any rights in, or give rise to any cause of
action by, any other person not a Party hereto.
Agreement to establish "BILL PAYMENT SERVICE" Page 9 of 14
25. This Agreement shall inure to the benefit of and be binding upon the Parties
and their respective legal representatives, successors, and permitted assigns.
26. No Party may assign its rights or obligations hereunder without the prior
written consent of all other Parties.
27. The CPS name shall not be used by the Parties for any purpose other than
contemplated under this Agreement without the prior written consent of all other Parties.
28. Unless the context of this Agreement otherwise clearly requires, references to
the plural include the singular, the plural and the part, the whole; "or" has the inclusive
meaning represented by the phrase "and/or, and "property" includes all properties and
assets of any kind or nature, tangible or intangible, real, personal or mixed. References in
this Agreement to "determination" (and similar terms) include good faith estimates by the
Parties (in the case of quantitative determinations) and good faith beliefs by the Parties
(in the case of qualitative determinations). The words "hereof," "herein," "hereunder"
and similar terms in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement.' Section, subsection, exhibit and schedule
references are to this Agreement unless otherwise specified.
29. Each Party shall take such other actions as the other Parry may reasonably
request to ensure that this Agreement is given full affect, including, but not limited to the
execution of such other documents and Agreements as may reasonably be necessary.
30. In addition to complying with this Agreement, CPS shall at all times comply
with any Federal, State, local or other law, rule, court order, court decision,
administrative decision, administrative order, regulation, statute, commentary, injunction
or other authority applicable to, and including without limitation the requirements of all
FEDERAL, STATE, and local governmental and regulatory or supervisory authorities
(collectively, "Governmental Authorities") having jurisdiction over (collectively,
"Avplicable Laws").
31. (1) CPS shall provide the Parties, and each of their staff, internal and external
auditors, or other authorized agents or representatives with access to (1) such facilities,
information, data, files, records, policies and procedures which are part of or relate to the
Bill Payment Service Program, CPS's Services or CPS finances, including without
limitation audits performed by CPS's external auditors, if applicable, (collectively,
"Comoanv Books and Records"), and (2) such employees, agents or representatives of
CPS that are responsible for providing or supervising the provision of the Company
Services or ensuring compliance with or supervising the compliance with the Company
Procedures ("Company Relevant Employees"), as may be reasonably necessary with
respect to the Bill Payment Services Program, CPS's Company Services or Procedures.
Such access shall be provided at CPS's offices upon reasonable prior notice.
Agreement to establish "BILL PAYMENT SERVICE" Page 10 of 14
32. The Parties each herebyrepresent, warrant and covenant to each other as
follows:
(A) Each is a Pennsylvania corporation, validly existing and in good standing
under the laws of the Commonwealth of Pennsylvania.
(B) Each has the power and authority to execute, deliver, perform, and take all
actions contemplated by this Agreement, and all such action has been duly and validly
authorized by all necessary proceedings on its part.
(C) This Agreement has been duly and validly executed and delis :red by each
Party. This Agreement constitutes the legal, valid and binding obligation of each Party,
enforceable against each in accordance with its terms.
(D) Each Party shall make reasonable efforts to maintain the overall quality of
CPS Services to be provided hereunder. The quality of all such Services shall be
consistent with the Procedures set forth herein.
(E) Each Party is familiar with all Applicable Laws that in any way govem this
Agreement or the Services. Each is in full compliance with all such Applicable Laws as
they apply to CPS Services or otherwise to CPS in connection with the Bill Payment
Services Program.
(F) Each Party has applied for and obtained all consents, licenses or other
approvals required by any Governmental Authorities for CPS to engage in the activities
contemplated by, and to perform its obligations under, this Agreement, including without
limitation Bill Payment Services.
(G) Neither the execution and delivery of this Agreement by either Party, nor
consummation by the Parties of the transactions herein contemplated, nor performance of
or compliance with the terms and conditions hereof by the Parties (including without
limitation providing, rendering and performing this Agreement) does or will:
(i) violate or conflict with any Applicable Law, or
(ii) violate, conflict with or result in a breach of any term or condition of,
or constitute a default under, or result in (or give rise to any right,
contingent or otherwise, of any person or entity to cause) any
termination, cancellation, prepayment or acceleration of
performance of, or result in the creation or imposition of (or give
rise to any obligation, contingent or otherwise, to create or impose)
any lien upon any property of the Company pursuant to, or otherwise
result in (or give rise to any right, contingent or otherwise, of any
person or entity to cause) any change in any right, power, privilege,
duty or obligation of either Party or in connection with,
Agreement to establish "BILL PAYMENT SERVICE" Page 11 of 14
(A) the charter or by-laws (or other constituent documents)
of either Party; or
(B) any agreement, indenture or instrument to which either
Party is a Parry or by which it or any of its properties
(now owned or hereafter acquired) may be subject
or bound.
33. All non-public information relating to the business of the Parties or the
Services provided hereunder or performance of this Agreement, including without
limitation this Agreement, which is submitted or disclosed by one Party to the other
during the negotiation, Initial Term or any Subsequent Term of this Agreement shall be
treated as confidential and safeguarded by the receiving Party to the same extent that such
Parry safeguards its own confidential and proprietary data, and each Parry will use
reasonable measures and will supervise its personnel so as to prevent the disclosure of
such confidential information to third persons or sue of such confidential information
except in connection with the Services provided under this Agreement provided.
however, that all Parties may disclose Basic descriptions of the Services in connection
with the performance or marketing of the Parties' respective services. This Paragraph
shall not prevent or prohibit disclosure of any information required to be disclosed to any
Governmental Authorities pursuant to any Applicable Laws on or pursuant to lawful
subpoena or judicial order; provided, however. that before making such disclosure the
subject Parry shall tender to the other any opportunity, to be exercised at no cost or
expense to the tendering Parry, and/or CPS to defend against such compulsory disclosure.
34. This Agreement may be executed simultaneously in one or more counterparts,
each of which shall be deemed an original, but all of which together shall constitute one
and the same instrument.
35. This Agreement is contingent upon MEMO's review and approval of all
organizational documents and shareholder/officer agreements of Currency Direct, Inc:
Further a copy of all existing documentation, procedures, source code, and object code
will be held at the law office of Geoffrey B. Gompers, and be updated no less often than
quarterly. .,
36. MEMO and CDI represent that each has in the past been represented by
CDI's attorney in a number of matters. CDI's attorney has made full disclosure of such
representations to each, and had advised both MEMO and CDI that such representations
has and does create a conflict of interest and that both Parties would be better advised to
retain their own independent counsel. Each Parry also understands that upon the
objection of either, CDI's counsel must and will withdraw from this representation. After
complete disclosure, and in the interest of saving time and in the interest of completing
this amicable Agreement, each has voluntarily and intelligently waived this conflict of
interest.
Agreement to establish "BILL PAYMENT SERVICE" Page 12 of 14
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of
the date first above written.
ME S EXPP.ESS MO RDER COMPANY
sMe t
C CY DI T, I1
By.
Um X
9' Prest nt L'[7 v1/V
AgFeement to establish "BILL PAYMENT SERVICE" Page 13 of 14
r
Addendum A - Agreement to Establish "Bill Payment Service"
REIMBU MAB EUENM
Salaries/Benefits/faxes Associated with payroll
Phone Costs (dedicated line for CPS use only)
Advertising Materials
Employee Expenses (Tmvel/Auto for CPS only)
Bank Fees
Third Party Processing Fees
Computer Equipment (with approval of Governing Committee)
Licensing Fees (CPS only)
Bonding Fees
Accounting Fees (billing hourly for CPS)
Marketing Expenses
Supplies for Resale
Computers for Resale
Programming Costs for system enhancements once system is fully operational
Printing
Interest Expenses
State Registration Fees
Attorney Fees (CPS incurred charges only)
Any other expense approved by majority vote of the Governing Committee
Agreement to establish "BILL PAYMENT SERVICE" Page 14 of 14
JUN k 4 Igggfk
CONSUMER PAYMENT IN THE COURT OF COMMON PLEAS
SERVICES, A Division of CUMBERLAND COUNTY, PENNSYLVANIA
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V. NO. 9 9 - JP--y6 ZCC
?
CURRENCY DIRECT, INC., /
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants IN EQUITY
ORDER
Goa
AND NOW, this 04-"' day of )unsL , 1999, upon
consideration of the verified Complaint in this action and the
accompanying Petition for Preliminary Injunctive Relief, it is
hereby ORDERED that:
(a) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvan3 are enjoin fro marketing, selling, ontra ting or
entering into an partnership or joint ve re with a third
party with egard to the "Bill P ent System" so tware
e lu ' ely licensed by CDI to Plaintiff;
(b) Defenda , CDI, I, Naveed Qu shi d Nikos
Valvaq?is, are t' fined from marketing, se ling, contracts
M
EXHIBIT "P-2"
entering y busi ss in
cond ed by CPS/MEM
on wi
(c) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enj Vrean g t an person, firm or
corporation a trt ils or rganization or
business of airs oas any na s of past or
present stomers r any other nform ation
rela g to the buof CPS/MEMO;
(d) Defendants, CDI, NDI, Naveed Qureshi and Nikos
Valvanis, are enjoined from changing the password to the
customer service module of the "Bill Payments System"
software, or, in any way, putting into place a security system
which will disable or impede the Plaintiff from using the
"Bill Payment System" software envisioned by the Agreement of
October 7, 1998 until all of the remedies of the Agreement
have been initiated, resolved and reached resolution;
(e) CDI is di
Gomper to deliver
code he(holds undr
CPS/MEMO
Agreement S
\o cause its attor eoffrey
3 1 materials program and
and
2
(f)d Such others lief as Co t may
d ju
(g) Directed to show cause before the Court on the
Q day of _ ,)iUNq , 1999, at L30 P(n
.M., in Courtroom No. -_, Cumberland County Courthouse,
Carlisle, Pennsylvania, why a preliminary injunction should
not be continued providing the relief requested by the
Plaintiff.
BY THE COURT:
E. UaiXu
r-t
P. J .
TRUE COPY FROM RECORD
in Testimony whereof. I h efc unto se; my hano
and the sea) of said Court at Carlisle, Pa.
This 84-VA day Qf-aLz , 19..CQ_
prothonotary
3
CONSUMER PAYMENT
SERVICES, A Division of
MERCHANTS EXPRESS MONEY
ORDER COMPANY,
Plaintiffs
V.
CURRENCY DIRECT, INC.,
NEU DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
. NO. 99-3840 EQUITY TERM
AND NOW, this 28th day of June, 1999, the
Defendants having failed to appear to show cause why the
preliminary injunction should not be continued, the
preliminary injunction issued by this Court on June 24,
1999, shall remain in full force and effect until further
order of Court.
The Plaintiff is directed to post bond with the
Prothonotary in the amount of $100.00 plus make all monthly
payments due under the contract on a timely basis to be
paid into court in the Prothonotary's office as a condition
of the preliminary injunction remaining in full force and
effect.
The first monthly payment due pursuant to this
order shall be due on July 20, 1999, for amounts owed
during the month of June.
t? .
An M a
EXHIBIT "P-3"
By the Co
Edward E. Guido, J.
3oordan D. Cunningham, Esquire
For, the Plaintiffs
:lfh,
TRUE COPY FROM RECORD
In Testimony whereot, I here unto set my hand
and the se i of said Coup at Carlisle, Pa.
This day 19
Pr honotary
CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS : CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN EQUITY
: NO. 99-3840 EQUITY TERM
AFFIDAVIT
I, Ken Augustine, being more than 21 years of age, and
competent to make the statements herein contained, due hereby
swear and affirm as follows:
1. I am the Research and Development Manager of Merchants
Express Money Order Company ("MEMO"). Consumer Payment Services
is a division of Merchants Express Money Order Company
(hereinafter referred to as "CPS/MEMO").
2. On Thursday morning, July 1, 1999, I received a
telephone call from Nikos Valavanis at 11:00 a.m. I had
conversed previously with Mr. Valavanis, and I recognized his
voice.
3. Mr. Valavanis quickly announced that he would shut down
the business operations of Neu-Direct, Inc. ("NDI") and the
business operations of Currency Direct, Inc. (11CDI''),
respectively, unless, and as part of an immediate resolution of
disputes between NDI and CDI, on the one hand, and CPS/MEMO on
the other hand, NDI receives all of the consumer bill payment
business of a certain CPS/MEMO agent business known as Currency
One. Mr. Valavanis stated that if he did so shut down the two
businesses, both the Agreement to Establish "Bill Payment
Service" between CDI and CPS/MEMO, dated October 7, 1998
("Agreement"), as well as the Order of the Court of Common Pleas
of Cumberland County, dated June 28, 1999, "would be worthless".
4. Mr. Valavanis further stated that if he chose to shut
down the said businesses "no one could do anything about it".
Mr. Valavanis stated that the parties could deal with other
issues between them at a later time, but the Currency One issue
needed to be dealt with immediately.
a ?
EXHIBIT "P-4"
5. At one point in the conversation, Mr. Valavanis stated
that his assets as well as the assets of Naveed Qureshi are or
would be located in another country and that CPS/MEMO could not
get them.
6. I told Mr. Valavanis that CPS/MEMO could not make
decisions for Currency One. Mr. Valavanis stated that it was his
understanding that Michael Carlone, the principal in Currency
One, had told CPS/MEMO that Mr. Carlone would agree to do
whatever CPS/MEMO and NDI agreed to. I responded that Mr.
Carlone had not told us that.
7. Mr. Valavanis stated that he would lay off all NDI
employees and would shut down the NDI business, which would shut
off the bill payment program offered by CPS/MEMO to consumers. I
told him that we could get the software located in Geoff Gompers'
office since CDI owns that software. Mr. Valavanis responded,
"what do you think, Mike Carlone has the equipment and can run
the software?" Mr. Valavanis further stated that he would not
allow us to walk away with the software. I responded that either
Mr. Carlone ur MEMO, properly holding the software, indeed could
operate the software. Mr. Valavanis immediately asked me whether
I personally knew what was on the compact digital disk in Mr.
Gompers' office. I replied that I assume it is the source code
and object code as specified in the Agreement. Mr. Valavanis
then asked whether I personally knew how old that software was.
I responded that I knew it was an earlier version.
8. I told Mr. Valavanis that I would meet with Tanya
Butler and Hans Leyer at MEMO for the purpose of recounting this
conversation next Tuesday or Wednesday when Mr. Leyer is back in
town, and that we then would telephone Mr. Valavanis. Mr.
Valavanis responded that he "cannot guarantee" how long NDI would
be open.
9. Mr. Valavanis also stated during the conversation that
he does not do business like Naveed Qureshi, that he is up front
about what he will do, and that he does not care what Mr. Qureshi
said or agreed to previously.
10. Mr. Valavanis also said that the rest of NDI's owners
want to file lawsuits, but he would not agree to spend the money
on that.
11. At approximately 11:00 a.m. on Tuesday, July 6, 1999, I
received a telephone call from Nikos Valavanis. During the
course of that conversation, Mr. Valavanis announced:
A. He had closed down the business operations of NDI;
2
B. He had laid off effective immediately all seven
(7) employees of NDI, including himself, Naveed Qureshi, and
four individuals whom I have reason to believe are members
of either the Valavanis family or the Qureshi family;
C. NDI must have in writing an agreement with
CPS/MEMO regarding payment processing and licensing fees
before CPS/MEMO again can utilize the bill payment service
software;
D. CPS/MEMO will not be able to log onto the bill
payment services software.
12. During the course of that conversation, Mr. Valavanis
additionally stated that CPS/MEMO "can go to court all it wants,
and get ten injunctions" and yet "no one can tell us [NDI] to
stay open if we are not making money."
13. The telephone conversation lasted no more than ten (10)
minutes.
14. I have met with Naveed Qureshi on several occasions. I
believe that he is a native of Pakistan. Mr. Qureshi has dark
brown hair and dark brown eyes. He stands approximately 51 10"
tall and weighs between 160 and 180 pounds. Mr. Qureshi wears
gold chains, and he drives a late model white BMW 528.
15. I have met personally with Nikos Valavanis. I believe
that he may be a native of Greece. Mr. Valavanis has dark brown
hair and dark eyes; stands approximately 51 91r in height; and
weighs approximately 160 to 180 pounds. I believe Mr. Valavanis
works as a consultant at ATI Research, 6 Terry Drive, Newtown, PA
18940.
Further, I sayeth not.
Sworn to before me this GA, day
of July, 1999.
Notary Public
Ken Au tine
:K.on otarial :11
CharMiller, ry Public
Hag, DauCounty
My ComExpeb. B, 2003
Member
, PennsyNanio Assoclatlon et Notaries
3
I, Ken Augustine, Research and Development Manager of
Merchants Express Money Order Company, verify that the statements
made in the foregoing Petition for Relief Under Pa. R.C.P. No.
1529(c), are true and correct to the best of my knowledge,
information, and belief. 2 understand that false statements
herein are made subject to the penalties of 18 Pa. C.S.A. §4904,
relating to unsworn falsification to authorities.
Ken Au%f6tine
Date: 74 A; y
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• • 9
JUL - 6 1999
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff/Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff/Petitioner and against
Defendants Currency Direct, Inc. ("CDI"), Defendant Neu-Direct,
Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff/Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
CDI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
C. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff /Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and in
operation through 11:59 P.M. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne xE gat,
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
i
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7• Release of either said Defendant Naveed Qureshi or
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
the amount of One Million Dollars ($1,000,000.00); and
3
Y
t
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this Order; and
C. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff /Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
JOrdan D. Cunningham, Require
For the Plaintiffs
NONR\TLP\ORDRRs\NRNO-CUR.RRN
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i
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4 JUL - g 199t,_?
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff /Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff /Petitioner and against
Defendants Currency Direct, Inc. ("CDIII), Defendant Neu-Direct,
Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff /Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
MI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
c. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff/Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and in
operation through 11:59 p.m. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne Exeat.
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7. Release of either said Defendant Naveed Qureshi or
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
the amount of One Million Dollars ($1,000,000.00); and
3
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this order; and
C. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff/Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
Jordan D. Cunningham. Require
For the Plaintiffs
HOMR\TLP\ORDRRR\MRMO-C .RRH
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• JUL - B 199
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff/Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff/Petitioner and against
Defendants Currency Direct, Inc. ("CDI"), Defendant Neu-Direct,
Inc. ("NDIII), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff/Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
CDI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
c. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff /Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and in
operation through 11:59 p.m. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne Exeat.
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7. Release of either said Defendant Naveed Qureshi or
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
the amount of One Million Dollars ($1,000,000.00); and
3
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this Order; and
C. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff/Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
Jordan D. Cunningham, Require
For the Plaintiffs
H0M8\TLP\0RD8R8\M8M0-CUR.R8N
4
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JUL 6 199?J
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff/Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff /Petitioner and against
Defendants Currency Direct, Inc. ("CDI"), Defendant Neu-Direct,
Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff /Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
CDI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
C. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff/Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999;
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment services software customer service module operable and in
operation through 11:59 p.m. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne Exeat.
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7. Release of either said Defendant Naveed Qureshi or
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
the amount of one million Dollars ($1,000,000.00); and
3
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this Order; and
c. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff/Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
J.
Jordan D. mnningham, Bsguire
For the Plaintiffs
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CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
AND NOW, this of July, 1999, upon consideration of the
verified Petition for Relief Under Pa. R.C.P. No. 1529(c) filed
by Petitioner/Plaintiff Consumer Payment Services, a division of
Merchants Express Money Order Company ("CPS/MEMO"), and the
presentation by Plaintiff /Petitioner to the Court and as regards
instances of willful, intentional violation of the Order of this
Court dated June 28, 1999, which granted certain injunctive
relief to and in favor of Plaintiff /Petitioner and against
Defendants Currency Direct, Inc. ("CDI"), Defendant Neu-Direct,
Inc. ("NDI"), Defendant Naveed Qureshi, and Defendant Nikos
Valavanis, and the Court finding that such violations have
occurred and have caused substantial, continuing, irreparable
harm and injury to the business, operations, and prospects of
Plaintiff /Petitioner CPS/MEMO, and for cause shown, it hereby is
ORDERED AND DECREED that:
1. Defendants CDI, NDI, Naveed Qureshi, and Nikos
Valavanis have violated and are in civil contempt of that certain
Order of the Court dated June 28, 1999, as a result of and in
that:
a. Since Tuesday morning, July 6, 1999, no modem-based
link-up by CPS/MEMO or its sales agents, to the customer service
module of the Bill Payment Service software licensed by Defendant
CDI to CPS/MEMO can be achieved.
b. Defendant CDI and Defendant NDI refuse to process
consumer bill payments received by CPS/MEMO agents on or after
July 2, 1999.
C. Defendant CDI and Defendant NDI refuse to provide
the consumer payments history file to CPS/MEMO.
2. The Court finds that there is continuing harm to the
business, operations and prospects of Plaintiff/Petitioner
CPS/MEMO in the amount of $220,000.00 per calendar day, as well
as likely harm to consumers who Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis anticipated would make, and have
made, bills payments via CPS/MEMO.
3. The Court hereby orders Defendants CDI, NDI, Naveed
Qureshi and Nikos Valavanis:
a. To deliver the consumer payments history file
spanning July 2, 1999 to date, concerning "Consumer Payments
Services" and/or CPS/MEMO agents, to CPS/MEMO by noontime on July
7, 1999,
b. To deliver the entire consumer payments history
file, from September 1, 1997 through July 1, 1999, inclusive,
concerning "Consumer Payment Services" and/or CPS/MEMO agents, to
CPS/MEMO by noontime on July 7, 1999;
2
r
c. To deliver all source code and object code for the
Bill Payment System software described in or contemplated by the
October 7, 1998 Agreement between CDI and CPS/MEMO, as updated,
in current form, with all additions and supplements, to CPS/MEMO
by noontime on July 7, 1999; and
d. To take all necessary steps to make the Bill
Payment Services software customer service module operable and in
operation through 11:59 p.m. E.D.T. on July 18, 1999.
4. The Court hereby orders the arrest by attachment of
Defendant Naveed Qureshi and Defendant Nikos Valavanis, wherever
each and either may be found, and for this purpose this Order
shall serve as a writ Ne Exeat.
5. The Court orders the sequestration of all assets of
Defendant Naveed Qureshi and of Defendant Nikos Valavanis,
respectively.
6. The Sheriff and all Deputies of Cumberland County,
Pennsylvania are hereby ordered and directed to deputize any and
all Sheriffs, Deputies, State Constables, and any Police in any
jurisdiction for the purpose of the arrest by attachment of the
said Defendant Naveed Qureshi and the said Defendant Nikos
Valavanis, and for the said purpose of the sequestration of any
and all assets of either of them.
7. Release of either said Defendant Naveed Qureshi or
Defendant Nikos Valavanis and/or any assets of either said
Defendant is conditioned upon:
a. The posting of a cash bond or equivalent at law in
the amount of One Million Dollars ($1,000,000.00); and
3
r
b. Cure of all defaults and occurrences described
above in Paragraph 1 of this Order; and
c. Full achievement of the matters set forth above in
Paragraph 3 of this Order; and
d. Payment to Plaintiff /Petitioner CPS/MEMO of costs
and attorneys fees in the amount of $3,000.00, by immediately
available funds.
BY THE COURT,
Jordan D. Cunningham, Raquirs
For tho Plaintiffs
N0M8\TLF\0RD8R9\M8M0-C -RRN
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CUNNINGHAM & CHERNICOFF, P.C.
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ATTORNEYS AT LAW
P.O. BOX 60457
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HARRISBURG, PENNSYLVANIA 17106-0457 '•' 'u" = 5 5
SGL/iJi iU.S Pn:TMr
MARC W WITZIG ESQUIRE
CUNNINGHAM & CHERNICOFF
2320 NORTH SECOND ST
PO BOX 60457
HARRISBURG PA 17106-0457
CONSUMER PAYMENT SERVICES,:
A DIVISION of MERCHANTS
EXPRESS MONEY ORDER
COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALVANIS,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
NO. 99-3690 EQUITY TERM
ORDER OF COURT
AND NOW, this (:'_day of July, 1999, upon agreement of
counsel, the hearing scheduled this date is continued
generally.
Jordan D. Cunningham, Esquire
For Plaintiff
Karen Lee Turner, Esquire
Lewis Rosman, Esquire
For Nikos Valvanis
By the Court, /
Edgar B.`Bdyley, J.
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CUNNINGHAM & CHERNICOFF, P.C.
)ORDAN D. CUNNINGHAM ATTORNEYS AT LAW H6&SHEY TELEPHONE
ROBERT E. CHERNICOFF 2320 NORTH SECOND STREET (717) 534-2833
PAIGE MACDONALT}MATIHE.S P.O. BOX 60457
MARC W. W 1T/.IG IRS NO. 23-2274135
HENRY W. VAN ECK HARRISBURG, PENNSYLVANIA 17106-0457
FAX
(717)239.4809
TELEPHONE (717) 238.5371
(717)238-6570
July 15, 1999
The Honorable Edgar B. Bayley
Cumberland County Courthouse
1 Courthouse Square VIA TELECOPIER - 240-6462
Carlisle, PA 17013
Re: Consumer Payment Services v.
c al.
No. 99-3840 (Equity Term
Dear Judge Bayley:
Please be advised that the parties in the above captioned
matter have resolved the issues which were raised in the Petition
for Contempt and the Rule to Show Cause issued by the Court on July
8, 1999, T have been advised by opposing counsel, Kitt Turner,
Esquire, that on the evening of July 14, 1999, I was forwarded by
Federal Express the CD discs which contained the information sought
in the Petition for Contempt. I have been advised that it has been
placed in a format which will be readable by Plaintiff. Therefore,
based upon Ms. Turner's represenation, both counsel request that
the hearing scheduled for 1:30 p.m. this afternoon be continued
generally conditioned upon Plaintiff receiving the CD disc in
readable form.
once I have been able to certify that the information
contained on the disc is the same as was represented by the
Defendant and that it is in readable form, I will advise the Court
and cancel the hearing. In the event that the information is not
that which was represented, is in an unreadable condition, or in a
format not compatible with my client's software and counsel cannot
resolve those difficulties, I will Praecipe the Court to reschedule
the hearing.
Thank you for your consideration in this matter.
C
JDC/bam
CC: Kitt Turner, Esquire
Lewis Rossman, Esquir
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CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY, :
Plaintiff,
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
IN EQUITY
NO. 99-3840 EQUITY TERM
Defendants.
To the PROTHONOTARY:
Kindly enter the appearance of undersigned counsel on behalf of defendants Neu
Direct, Inc., Naveed Qureshi and Nikos Valavanis in the above matter.
ECKERT SEAMANS CHERIN &
MELLOTT,LLC
Dated: July 20, 1999
By:
Vl/_
Karen Lee Turner, ID No. 27898
Lewis Rosman, ID No. 72033
1515 Market Street, Ninth Floor
Philadelphia, PA 19102-1909
(215) 851-8400
I hereby certify that on July 21, 1999, a true and correct copy of the foregoing Entry of
Appearance of Karen L. Turner and Lewis Rosman on behalf of defendants Neu Direct, Naveed
Qureshi and Nikos Valavanis was served via facsimile and first-class mail upon the following
counsel of record:
Jordan D. Cunningham, Esquire
Marc W. Witzig, Esquire
Cunningham & Chernicoff, P.C.
2320 North Second Street
P.O. Box 60457
Harrisburg, PA 17106-0457
V K?_.
Lewis Rosman
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CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
TO THE PROTHONOTARY:
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
IN EQUITY
NO. 99-3840 EQUITY TERM
PRAECIPE
Please mark the Plaintiff's Petition for Relief Under
Pa.R.C.P. No. 1529(c), filed in the above-captioned matter, as
withdrawn without prejudice.
Respectfully submitted,
& CHERNICOFF, P.C.
By : / Gt L-[/ 0, 2
Marc W. Witzig, Esquire
Attorney Id. No. 29929
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
(717) 238-6570
(Attorneys for Plaintiff)
Date: August 3, 1999
CONSUMER PAYMENT SERVICES,
A Division of MERCHANTS
EXPRESS MONEY ORDER COMPANY,
Plaintiff
v.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
: IN THE COURT OF COMMON PLEAS OF
: CUMBERLAND COUNTY, PENNSYLVANIA
: IN EQUITY
: NO. 99-3840 EQUITY TERM
CERTIFICATE OF SERVICE
I, Charlene K. Miller, a legal secretary for the law firm of
Cunningham & Chernicoff, P.C., hereby certify that on this 3rd
day of August, 1999, a true and correct copy of the foregoing
Praecipe was served by first-class mail, postage prepaid, to the
persons named on the attached service list.
CUNNINGHAM & CHERNICOFF, P.C
By: 1-mL,
Charlene K. Miller
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
e
Karen Lee Turner, Esquire
Eckert Seamans Cherin &
Mellott, LLC
1515 Market Street
9th Floor
Philadelphia, PA 19102-1909
Currency Direct, Inc.
10050 Roosevelt Boulevard
Philadelphia, PA 19114
Attn: Michael Carlone,
Secretary/Treasurer
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CONSUMER PAYMENT SERVICES, IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY, :
Plaintiff,
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants.
IN EQUITY
NO. 99-3840 EQUITY TERM
AND NOW, this 7t,2- day of -. LI IU2- , 2000, upon consideration of the
Petition of Eckert Seamans Cherin & Mellott to Withdraw as Counsel for defendants Neu-Direct,
Inc., Naveed Qureshi and Nikos Valavanis, it is hereby ORDERED that said Petition is
GRANTED.
Eckert Seamans Cherin & Mellott is granted leave to withdraw as counsel for defendants.
IT IS SO ORDERED.
BY THE COURT.-
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CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY, :
Plaintiff,
vi.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
IN EQUITY
NO. 99-3840 EQUITY TERM
Defendants.
PETITION OF ECKERT SEAMANS CHERIN & MELLOTT, LLC,
TO WITHDRAW AS COUNSEL FOR DEFENDANTS
NEU-DIRECT. INC.. NAVEED QURF.SHI AND NIKOS VALAVANIS
Petitioner Eckert Seamans Cherin & Mellott ("ESCM") hereby petitions the Court for
leave to withdraw as counsel for defendants Neu-Direct, Inc., Naveed Qureshi and Nikos
Valavanis, and in support thereof states as follows:
1. In July 1999, defendants Neu-Direct, Inc., Naveed Qureshi and Nikos Valavanis
engaged ESCM to represent them in connection with the above-captioned matter.
2. ESCM thereafter entered its appearance in this matter but have filed nothing
further with the Court.
3. Defendants Neu-Direct, Inc., Navecd Qureshi and Nikos Valavanis have informed
ESCM that they no longer wish ESCM to represent them.
WHEREFORE, Petitioner Eckert Seamans Cherin & Mellott respectfully requests that
this Court grant it leave to withdraw its appearance on behalf of defendants Neu-Direct, Inc.,
Naveed Qureshi and Nikos Valavanis.
Dated: June 15, 2000
ECKERT SEAMANS CHERIN &
MELLOTT,LLC
By V-?
Karen Lee Turner, ID No. 27898
Lewis Rosman, ID No. 72033
1515 Market Street, Ninth Floor
Philadelphia, PA 19102-1909
(215) 851-8400
CONSUMER PAYMENT SERVICES, IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY, :
Plaintiff,
vii.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
IN EQUITY
NO. 99-3840 EQUITY TERM
Defendants.
MEMORANDUM IN SUPPORT OF PETITION OF
ECKERT SEAMANS CHERIN & MELLOTT, LLC,
TO WITHDRAW AS COUNSEL FOR DEFENDANTS
NEU-DIRECT. INC.. NAVEED QU FSHI AND NIKOS VALAVANIC
In July 1999, defendants Neu-Direct, Inc., Naveed Qureshi and Nikos Valavanis engaged
Eckert Seamans Cherin & Mellott ("ESCM") to represent them in connection with the above-
captioned matter. ESCM thereafter entered its appearance for them.
Defendants Neu-Direct, Inc., Naveed Qureshi and Nikos Valavanis have informed ESCM
that they no longer wish ESCM to represent them. In light of defendants' stated desire that
ESCM not represent them, this Court should grant ESCM's Petition and allow it to withdraw as
counsel.
ECKERT SEAMANS CHERIN &
MELLOTT, LLC
Dated: June 15, 2000
By: Ij!l",,.., -
Karen Lee Turner, ID No. 27898
Lewis Rosman, ID No. 72033
1515 Market Street, Ninth Floor
Philadelphia, PA 19102-1909
(215) 851-8400
1, Lewis Rosman, hereby verify that I am an associate of the law firm of Eckert Seamans
Cherin & Mellott and that the facts set forth in the foregoing Petition are true and correct to the
best of my knowledge, information and belief. I further state that this Verification is made
pursuant to 18 P.S. § 4904 relating to unsworn falsification to authorities.
June 15, 2000
Lewis Rosman
I hereby certify that on June 15, 2000, a true and correct copy of the foregoing Petition of
Eckert Seamans Cherin & Mellott to Withdraw as Counsel for defendants Neu Direct, Naveed
Qureshi and Nikos Valavanis was served via first-class mail upon the following counsel of
record:
Jordan D. Cunningham, Esquire
Marc W. Witzig, Esquire
Cunningham & Chemicoff, P.C.
2320 North Second Street
P.O. Box 60457
Harrisburg, PA 17106-0457
VA,,--?
Lewis Rosman
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CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS : CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
TO THE PROTHONOTARY:
IN EQUITY
NO. 99-3840 EQUITY TERM
PRAECIPE
Please mark the above-captioned as voluntarily discontinued without prejudice in
accordance with Pa.R.C.P. 229.
Respectfully submitted,
Date:
Attdmey Id. 6. 29929
Kelly M. Kr(ight, Esquire
Attorney Id. No. 87365
2320 North Second Street
P. 0. Box 60457
Harrisburg, PA 17106-0457
(717) 238-6570
(Attorneys for Plaintiff)
P.C.
FAHOMBTLEIPRAECIPETONSUMEI. W PD
CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS : CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN EQUITY
NO. 99-3840 EQUITY TERM
CERTIFICATE OF SERVICE
I, Melanie L. Kirk, a legal secretary for the law firm of Cunningham & Chemicoff, P.C.,
hereby certify that on this Y thday of September, 2003, a true and correct copy of the foregoing
Praecipe was served by first-class mail, postage prepaid, to the following:
Karen Lee Turner, Esquire
Eckert Seamans Cherin & Mellott, LLC
1515 Market Street
9th Floor
Philadelphia, PA 19102-1909
Currency Direct, Inc.
Attn: Michael Carlone,
Secretary/Treasurer
10050 Roosevelt Boulevard
Philadelphia, PA 19114
CUNNINGHAM & CHERNICOFF, P.C.
By: - 0
Melanie C Kirk
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS : CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN EQUITY
NO. 99-3840 EQUITY TERM
PRAECIPE
TO THE PROTHONOTARY:
Please mark the above-captioned as voluntarily discontinued without prejudice in
accordance with Pa.R.C.P. 229.
Respectfully submitted,
CUNNINGIJAM & CPERNICAF/, P.C.
By:
Date:
F: WOAIE\TLFPRAECIPE\CONSUM1IE I.N'1'D
Attdmey Id. o. 29929
Kelly M. fight, Esquire
Attorney Id. No. 87365
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
(717) 238-6570
(Attorneys for Plaintiff)
CONSUMER PAYMENT SERVICES, : IN THE COURT OF COMMON PLEAS OF
A Division of MERCHANTS : CUMBERLAND COUNTY, PENNSYLVANIA
EXPRESS MONEY ORDER COMPANY,
Plaintiff
V.
CURRENCY DIRECT, INC.,
NEU-DIRECT, INC.,
NAVEED QURESHI, and
NIKOS VALAVANIS,
Defendants
IN EQUITY
NO. 99-3840 EQUITY TERM
CERTIFICATE OF SERVICE
I, Melanie L. Kirk, a legal secretary for the law firm of Cunningham & Chemicoff, P.C.,
hereby certify that on this tkday of September, 2003, a true and correct copy of the foregoing
Praecipe was served by first-class mail, postage prepaid, to the following:
Karen Lee Turner, Esquire
Eckert Seamans Cherin & Mellott, LLC
1515 Market Street
9th Floor
Philadelphia, PA 19102-1909
Currency Direct, Inc.
Attn: Michael Carlone,
Secretary/Treasurer
10050 Roosevelt Boulevard
Philadelphia, PA 19114
CUNNINGHAM & CHERNICOFF, P.C.
Melanie C Kirk .
2320 North Second Street
P. O. Box 60457
Harrisburg, PA 17106-0457
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