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MASTER TREASURY MANAGEMENT SERVICES AGREEMENT – TERMS AND DISCLOSURES
This Master Treasury Management Services Agreement – Terms and Disclosures (these “Terms and Disclosures”) governs the treasury management relationship between Bank SNB, an Oklahoma state banking corporation (the “Bank”) and the customer identified in the Master Treasury Management Services Implementation Agreement (“Customer”). Bank and Customer are sometimes collectively referred to as the “Parties”. By executing the Master Treasury Management Services Implementation Agreement (“Implementation Agreement”) or using the Services (as defined in Section I.A.1 of these Terms and Disclosures), Customer agrees to be bound by the terms of these Terms and Disclosures, the Implementation Agreement, and any Separate Agreements (as defined in Section I.A.3), and any supplement or Amendment to any of the same. Customer also agrees that the deposit accounts to which the Services apply are governed by the General Terms and Conditions and the disclosure entitled “Terms and Conditions of Your Deposit Account” (the “Account Terms”). Except as otherwise provided herein, where any terms and conditions contained in the Implementation Agreement, or the Account Terms conflict with the terms of these Terms and Disclosures, the terms of these Terms and Disclosures control.
I. GENERAL TERMS AND CONDITIONS
The following general terms and conditions apply to all Services provided by Bank to Customer. Terms applicable to a specific Service are as set forth in the respective Service Terms (as defined in Section I.A.2).
A. DEFINITIONS AND TERMS.
1. Services: One or more treasury management services available to Customer under the
Implementation Agreement and the terms and conditions set forth in these Terms and
Disclosures. (Individually a “Service”). The Bank is under no obligation to permit
Customer's use of any Service. The decision to permit Customer's use of any one or
more Service is within the Bank's sole discretion.
2. Service Terms: Terms and conditions contained in these Terms and Disclosures
applicable to a specific Service as set forth in the Implementation Agreement. The
Service Terms for a specific Service only apply to Customer if Customer has requested
the Service, and Bank has agreed to permit Customer's use of the Service.
3. Separate Agreements: Additional or supplemental agreements or addenda to these
Terms and Disclosures, including but not limited to the Implementation Agreement, that
are required by Bank or third party service providers in connection with the provision of
some of the Services. If Customer is permitted to use a Service that requires a Separate
Agreement, Customer's use of such Service will be conditioned on and subject to
Customer's execution of the applicable Separate Agreement(s) and the Implementation
Agreement.
4. Business Day: Unless otherwise provided in these Terms and Disclosures, or any
Separate Agreement, “Business Day” means Mondays through Fridays, other than Bank
holidays and other than days on which the Bank's principal office may be closed for any
reason prior to 4:00 p.m. Central Standard Time.
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5. Access Credentials: The combination of user names, log-in IDs, passwords and other
authentication methods created and used by the Treasury Management System
Administrator, and by Authorized Users managed by the Treasury Management System
Administrator, to access and use one or more of the Services.
6. Authorized User: A person authorized by the Treasury Management System
Administrator to access and use one or more of the Services.
7. The Services to be provided by Bank to Customer under the Implementation Agreement,
any Separate Agreement, and these Terms and Disclosures shall be deemed in all
respects to be a financial accommodation under 11 U.S.C. § 365(c)(2).
8. Any person or entity who signs the Implementation Agreement or any Separate
Agreement as agent for Customer also shall be deemed to be “Customer,” or duly
authorized and empowered to act on behalf of Customer, under the Implementation
Agreement, any Separate Agreement, and these Terms and Disclosures for all purposes.
9. The Services to be provided by Bank to Customer under the Implementation Agreement,
any Separate Agreement, and these Terms and Disclosures shall be deemed in all
respects to be a financial accommodation under 11 U.S.C. § 365(c)(2).
10. Any person or entity who signs the Implementation Agreement or any Separate
Agreement as agent for Customer also shall be deemed to be “Customer,” or duly
authorized and empowered to act on behalf of Customer, under the Implementation
Agreement, any Separate Agreement, and these Terms and Disclosures for all purposes.
B. REPRESENTATIONS AND WARRANTIES OF CUSTOMER. Customer hereby represents
and warrants to Bank as follows:
1. If Customer is a business or commercial entity, Customer is duly organized, validly
existing and in good standing under the laws of the state of its organization or
incorporation and is duly qualified or licensed to do business in each jurisdiction in which
the property related to it is owned, leased or operated by Customer or where the nature
of its business makes such qualification necessary;
2. jurisdiction in which the property related to it is owned, leased or operated by Customer
or where the nature of its business makes such qualification necessary;
3. Customer has the power and authority to enter into the Implementation Agreement, to be
bound by these Terms and Disclosures, and to consummate or cause to be
consummated the transactions contemplated hereby;
4. The consummation of the transactions contemplated hereby have been duly and validly
authorized by Customer and no other corporate or other proceeding on the part of
Customer is necessary to authorize the performance of these Terms and Disclosures;
5. Unless the Bank has expressly consented to utilization of the Services for consumer
purposes, the Services will be used for business or commercial purposes only. The
Services will not be used for any unlawful purpose;
6. All data and funds transfer requests whether by wire, ACH or otherwise, comply with U.S.
laws and do not include transmitting funds to, from, or on behalf of any person, business
or country subject to U.S. sanction or which would in any manner violate the laws,
regulations and Presidential Orders of the U.S.
7. Customer is the owner and/or authorized agent on all accounts subject to the
Implementation Agreement and these Terms and Disclosures.
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Customer agrees to provide Bank with such documentation as Bank may reasonably request as evidence of the above representations and warranties.
C. MONTHLY STATEMENTS. Unless otherwise provided in these Terms and Disclosures, or in
any Separate Agreement, Bank shall provide Customer with a monthly statement
summarizing the previous month's account activity for Services rendered hereunder.
D. NO IMPLIED REPRESENTATION. NOTWITHSTANDING ANYTHING IN THESE TERMS
AND DISCLOSURES TO THE CONTRARY, CUSTOMER ACKNOWLEDGES AND AGREES
THAT BANK IS MAKING NO REPRESENTATION OR WARRANTY WHATSOEVER,
EXPRESS OR IMPLIED, IN LAW OR IN FACT, INCLUDING BUT NOT LIMITED TO, THE
IMPLIED WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR
PURPOSE, EITHER TO CUSTOMER OR TO ANY THIRD PARTY WITH RESPECT TO THE
SERVICES OR ANY COMPUTER PROGRAMS, EQUIPMENT OR SOFTWARE USED BY
CUSTOMER IN CONNECTION WITH THE SERVICES.
E. LIMITATION OF LIABILITY; INDEMNIFICATION. EXCEPT AS OTHERWISE PROVIDED IN
THESE TERMS AND DISCLOSURES, OR ANY APPLICABLE SEPARATE AGREEMENT,
AND EXCEPT AS OTHERWISE REQUIRED BY APPLICABLE LAW, BANK'S LIABILITY TO
CUSTOMER IS LIMITED TO DAMAGES ARISING DIRECTLY FROM BANK'S
INTENTIONAL MISCONDUCT OR GROSS NEGLIGENCE IN THE PERFORMANCE OF
THE SERVICES. CUSTOMER RELEASES AND AGREES TO HOLD HARMLESS,
DEFEND, AND INDEMNIFY BANK, ITS DIRECTORS, OFFICERS, EMPLOYEES,
AFFILIATES, CONTROLLING PERSONS, AGENTS, REPRESENTATIVES AND
CUSTOMERS AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS FROM AND
AGAINST ANY AND ALL LIABILITIES, DEMANDS, CLAIMS, ACTIONS OR CAUSES OF
ACTION, ASSESSMENTS, LOSSES, DAMAGES, COSTS AND EXPENSES (INCLUDING,
WITHOUT LIMITATION, REASONABLE ATTORNEYS' FEES AND EXPENSES) AND ALL
FINES, PENALTIES AND INTEREST THEREON AS A RESULT OR ARISING DIRECTLY
OR INDIRECTLY OUT OF,: (I) BANK'S ACTS OR OMISSIONS IN CONNECTION WITH
PROVIDING THE SERVICES, IF SUCH ACTS OR OMISSIONS ARE IN ACCORDANCE
WITH CUSTOMER'S INSTRUCTIONS, THE TERMS OF THE IMPLEMENTATION
AGREEMENT, OR THESE TERMS AND DISCLOSURES, (II) ANY BREACH OF
CUSTOMER'S REPRESENTATIONS OR WARRANTIES, OR OTHER ACTS OR
OMISSIONS OF CUSTOMER, INCLUDING, WITHOUT LIMITATION, CUSTOMER'S
VIOLATION OF APPLICABLE LAWS OR REGULATIONS; (III) ANY ACTS OR OMISSIONS
OF THIRD PARTIES (INCLUDING, WITHOUT LIMITATION, OTHER FINANCIAL
INSTITUTIONS, ANY FEDERAL RESERVE BANK, AUTOMATED CLEARINGHOUSES,
AND ANY OTHER THIRD PARTY WITH WHICH BANK MAY CONTRACT IN CONNECTION
WITH THE SERVICES TO BE PROVIDED), IF SUCH ACTS OR OMISSIONS ARE IN
ACCORDANCE WITH CUSTOMER'S INSTRUCTIONS, THE TERMS OF THE
IMPLEMENTATION AGREEMENT, OR THESE TERMS AND DISCLOSURES; AND (IV)
ANY ACT OR OMISSION BY CUSTOMER (OR ANY OF CUSTOMER'S DIRECTORS,
OFFICERS, AGENTS, REPRESENTATIVES, EMPLOYEES, AFFILIATES CONTROLLING
PERSONS, AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS) IN CONNECTION
WITH, OR ANY INTENTIONAL OR UNINTENTIONAL FAILURE BY CUSTOMER (OR ANY
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OF CUSTOMER'S DIRECTORS, OFFICERS, EMPLOYEES, AFFILIATES, CONTROLLING
PERSONS, AGENTS AND REPRESENTATIVES AND THEIR RESPECTIVE
SUCCESSORS AND ASSIGNS) TO COMPLY WITH, UTILIZE OR FOLLOW,
INFORMATION SECURITY PROCEDURES AND PROTECTIONS, INCLUDING, WITHOUT
LIMITATION, ANY ACT, OMISSION OR FAILURE RELATED TO ACCESS NUMBER(S),
PASSWORD(S), LOG-IN ID(S), SECURITY TOKENS, SECURITY TOKEN SERIAL
NUMBERS, PERSONAL IDENTIFICATION NUMBER(S), PASSCODE(S) AND ACCOUNT
NUMBER(S) ASSIGNED TO CUSTOMER. CUSTOMER AGREES THAT WHEN
APPLICABLE LAW REQUIRES BANK TO EXERCISE ORDINARY CARE, SUBSTANTIAL
COMPLIANCE WITH THE PROCEDURES ESTABLISHED BY BANK SHALL BE DEEMED
TO CONSTITUTE THE EXERCISE OF ORDINARY CARE, AND CUSTOMER AGREES
THAT OCCASIONAL, UNINTENTIONAL DEVIATIONS BY BANK FROM THE
PROCEDURES SET FORTH HEREIN SHALL NOT BE DEEMED A FAILURE TO
EXERCISE ORDINARY CARE AS TO THE TRANSACTIONS WITH RESPECT TO WHICH
ANY SUCH DEVIATIONS OCCUR. Except as otherwise provided by applicable law, in no
event shall either Party be liable to the other Party for any loss of profits, incidental, special,
indirect, exemplary, consequential or punitive damages. Under no circumstances will either
Party be responsible for any delay or failure to act in connection with the Implementation
Agreement and these Terms and Disclosures if the failure or delay is due to circumstances
beyond its control including without limitation: strikes or lockouts; fire or other casualty; risk or
civil commotion; acts of war or terrorism; windstorms, earthquakes, floods or other acts of
God; delay in transportation; government regulation or interferences; interruption or delay in
the Internet, telecommunication or third party services; failure of third party software or
hardware, or inability to obtain raw materials, supplies, or power used in equipment needed
for the provision of the Services. Customer shall promptly examine all reports and statements
of accounts subject to the Implementation Agreement and these Terms and Disclosures and
shall notify Bank immediately in the event of an error or discrepancy. If Customer fails to
notify Bank within thirty (30) days from the date of the statement in which the error or
discrepancy is noted, Bank shall not be liable to Customer for any losses arising from such
error or discrepancy. With respect to any other matter, Customer may not assert a claim
against Bank arising in connection with the Implementation Agreement and these Terms and
Disclosures more than one (1) year after the occurrence of the event which gives rise to such
claim. The rights and obligations of Customer and Bank under this Section I.E shall be in
addition to and not in limitation of the rights and obligations of Customer and Bank under
other sections of these Terms and Disclosures.
F. CORPORATE SOURCE OF STRENGTH. If Customer is a commercial entity, Customer and
Customer’s parent company agree that any liability which it may incur relating to its treasury
management relationship with Bank under the Implementation Agreement, these Terms and
Disclosures, and/or any Separate Agreement, shall also be the legal responsibility of its
parent company (if any). Accordingly, Customer’s parent company shall be legally liable for
any and all of Customer’s indebtedness to Bank arising from its treasury management
relationship with Bank and shall be obligated to provide all necessary financial resources to
Customer to ensure that Customer meets all of its legal and financial responsibilities to Bank.
Bank shall have full legal recourse against parent company for its failure to do so. For
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purposes of this section, the term “parent company” is defined as any company that controls,
either directly or indirectly, the Customer.
G. USER ADMINISTRATION. Customer is advised that certain Services may be provided by
way of the Internet using the Bank's on-line Treasury Management System or other software
provided by Bank or its third party service providers. In order to access the Bank's on-line
Treasury Management System and/ or access certain Services, Customer must utilize the
Implementation Agreement to designate a person or persons who will be responsible for
system administration and all access approval rights within Customer's organization (the
“Treasury Management System Administrator”). Customer’s access to Data related to the
software required to obtain the Services shall be governed exclusively by Customer’s
designated Treasury Management System Administrator. A Treasury Management System
Administrator may be designated to one or more Services. This Treasury Management
System Administrator may be granted management and administrative rights including the
right to (1) receive notices from Bank (2) administer the use of designated Services among
Authorized Users, (3) add or remove Authorized Users from time to time to preserve the
security and integrity of its Data, (4) provide such Authorized Users with Access Credentials,
and to determine what rights an Authorized User has with respect to Data and the Services
software, and (4) reset passwords. Bank may rely on the instructions of the Treasury
Management System Administrator designated by Customer. Customer acknowledges and
agrees that Customer is solely responsible for determining the authority and limits for
Authorized Users with access to the Services. Certain features for enhancing the security of
Customer's information are made available to Customer. These include the use of passwords
or log-in IDs and approval levels for the type of task performed. It is Customer's responsibility
to use these features and to protect the confidentiality of passwords and log-in IDs. Customer
agrees to immediately contact Bank if Customer learns of any breach in security, including
without limitation, the loss or theft of any password or log-in ID, or any unauthorized use of
any of Customer's passwords or log-in IDs, and if Customer has reason to believe that the
Access Credentials of the Treasury Management System Administrator(s) or its Authorized
Users have been lost, stolen, used without the proper authorization, or otherwise
compromised. If Customer fails to immediately notify Bank of any breach in security,
Customer agrees that Bank shall not be liable for any losses resulting from Customer's failure
to give such notice. Customer’s access to and use of the software required to obtain the
Services shall be for Customer’s internal business use only and may not be used by
Customer for the benefit of any third party.
H. CUSTOMER'S ACCESS CREDENTIALS. Customer accepts full responsibility for the
confidentiality and security of each Authorized User's Access Credentials. Customer agrees
that its Treasury Management System Administrator will use industry best practices in
creating, assigning, using and storing Access Credentials. Customer agrees that it is solely
responsible for all activities and transactions conducted with the software required to utilize
the Services through the use of Access Credentials or by the Treasury Management System
Administrator(s) or Authorized Users. Customer further agrees to immediately notify Bank if
the Authorized Signer or any Treasury Management System Administrator leaves the
employment of Customer or if their access to the foregoing software should be terminated for
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any other reason. Any such notifications shall be sent to the following email address:
CustomerSolutionCenter@banksnb.com. Bank shall not be responsible for any loss or liability
suffered by Customer or any third party in the event a person who is not an Authorized User
uses an Authorized User’s Access Credentials.
I. SECURITY. Access to the Bank's on-line Treasury Management System and certain
Services require that Customer receive and transmit data, information, orders and
instructions (including, without limitation, instructions to transfer, transmit, pay or remit funds)
via connection or remote computers over telephone lines. Customer acknowledges that data
including e-mail, electronic communications and confidential financial data and information,
may be accessed by unauthorized third parties when communicating to Bank using the
Internet or other network or dial-up communications facilities, telephone or any other
electronic means. By using the Internet in connection with the Services or to otherwise
communicate with Bank, Customer is assuming the risk that viruses, Trojan horses, worms,
or other harmful components may be transmitted to Customer. Customer agrees to install
and utilize on its system commercially reasonable antivirus and/or similar software or use
other appropriate protections. BANK DOES NOT WARRANT THAT THE SERVICES, ANY
REPORT GENERATED IN CONNECTION WITH THE SERVICES, OR THE SERVERS OR
OTHER PROPERTY THAT ARE USED TO PROVIDE THE SERVICES AND ANY
REPORTS WILL BE FREE OF VIRUSES OR OTHER HARMFUL COMPONENTS. With
respect to Internet access to the Bank's on-line Treasury Management System, Customer
agrees to use software produced by third parties, including, but not limited to “browser”
software that supports a data security protocol compatible with the protocol used by Bank.
Until notified otherwise by Bank, Customer agrees to use software that supports the secure
socket layer (“SSL”) protocol or other protocols accepted by Bank and follow Bank's log-on
procedures that support such protocols. Customer acknowledges that Bank is not
responsible for: (i) notifying Customer of any upgrades, fixes or enhancements to any such
software; or (ii) any compromise of data transmitted across computer networks or
telecommunications facilities, including, but not limited to, the Internet. With the exception of
applications commonly known as web browser software, or other applications formally
approved by Bank in writing, Customer agrees not to use any software, program, application
or any other device to access or log on to Bank's computer systems, web site or proprietary
software or automate the process of obtaining, downloading, transferring or transmitting any
data or information to or from Bank's computer systems, web site or proprietary software. In
the event of any system failure, Bank reserves the right to require additional documentation,
including written authorization via facsimile from the Treasury Management System
Administrator before accepting any order reinstating Customer's access to the Bank's online
Treasury Management System. Customer assumes full responsibility for its selection of,
access to, and use of Services obtained from Bank as indicated in the Implementation
Agreement. Customer shall be solely responsible for educating and supervising its Treasury
Management System Administrator (s) and Authorized Users with respect to the risks of,
vishing, smishing, tabnabbing, tailgating, baiting, keystroke logging and similar social
engineering schemes used to circumvent the proper authentication of Treasury Management
System Administrator or Authorized Users. Customer shall also be responsible for the
confidentiality, maintenance, and use of its financial information, and of any access number
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(s), password(s), log-in ID(s), security tokens, security token serial numbers, personal
identification number(s), passcode(s) and account number(s) assigned to Customer. If
Customer requires more than one authorized signer's signature or authorization to conduct
certain transactions related to Customer's account(s) or the Services, this requirement will be
deemed solely for Customer's own purposes. Bank will not be liable to Customer as long as
at least one authorized signer's signature appears on Customer's checks, drafts, instructions,
or orders, or if Bank's records indicate that a transaction, payment or other product use was
made by or on behalf of one authorized signer. This includes situations in which Customer
has provided its access number(s), password(s), log-in ID(s), security tokens, security token
serial numbers, personal identification number(s), passcode(s) and/or account number(s) to
someone else to use. Customer agrees not to hold Bank liable for following Customer's
written orders or instructions (including, without limitation, instructions to transfer, transmit,
pay or remit funds) or for data and information transmitted to Bank by or for Customer,
including, without limitation, orders, instructions, data and information transmitted to Bank
using Bank designated transfer methods and protocols. Customer agrees not to hold Bank
liable for any damages of any kind resulting from Customer's disclosures of its access
number(s), password(s), log-in ID(s), security tokens, security token serial numbers, personal
identification number(s), passcode(s) and/or account number(s) to any person identified or
not identified in the Implementation Agreement. Customer will be responsible for all orders
and instructions (including, without limitation, instructions to transfer, transmit, pay or remit
funds) entered and data and information transmitted through and under Customer's access
number (s), password(s), log-in ID(s), security tokens, security token serial numbers,
personal identification number(s), passcode(s) and/or account number(s), and any orders or
instructions (including, without limitation, instructions to transfer, transmit, pay or remit funds)
so received by Bank will be deemed to have been received from Customer. All data,
information, orders and instructions (including, without limitation, instructions to transfer,
transmit, pay or remit funds) shall be deemed to be made at the time received by Bank and in
the form received. Customer agrees to immediately notify Bank if Customer learns of:
1. any loss or theft of Customer's access number(s), password(s), log-in ID(s), security
tokens, security token serial numbers, personal identification number (s), passcode(s)
and/or account number(s);
2. any unauthorized use of any of Customer's access number(s), password(s), log-in ID(s),
security tokens, security token serial numbers, personal identification number(s),
passcode(s) and/or account number(s), or of the electronic Services or any information;
3. any receipt by Customer of confirmation of an order that Customer did not place, or any
similarly inaccurate or conflicting report or information; or any other breach of security.
J. OUT-OF-BAND AUTHENTICATION AND ONE TIME PINS. In order for Customer to use
certain Services contained herein, Bank may, in its sole discretion, require Customer to
successfully authenticate itself through various Out Of Band Authentication (“OOBA”)
procedures, including but not limited to delivery of a One Time PIN (“OTP”). Delivery of the
OTP may be made in any manner determined by the Bank, including but not limited to by a
phone call, text message, or e-mail. Bank shall make one or more delivery methods
available to Customer, in Bank’s sole discretion. Customer shall choose on or more delivery
methods from those made available by the Bank to the Customer. Customer agrees that it
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shall be responsible for and retain complete control over maintaining correct and updated
phone numbers and e-mail addresses for delivery of the OTP. Customer represents that it is
the legal owner or authorized user of the phone or mobile device Customer uses to receive
out-of-band authentication messages and that Customer is authorized to approve the
applicable charges. Customer also represents that all the information Customer provides to
Bank in connection with the Services, including Customer’s email address and phone
number, are accurate, current, and complete, and that Customer has the right to provide such
information to Bank for using the Services. Customer agrees not to misrepresent its identity
or its account information. Customer hereby grants Bank its express consent permitting Bank
to contact Customer as necessary to provide the Services. Such activities may include, but
are not limited to undertaking fraud prevention by sending one-time PINs via text message, e-
mail message, and/or phone call, regardless of the registration of Customer’s phone number
on any state or federal do not call list. Bank is not obligated to use out-of-band authentication
or one time PINs and will not be liable for failure to do so. Bank will not be liable for any
delays or failures in Customer’s receipt of any text messages as delivery is subject to
effective transmission from Customer’s network operator and processing by Customer’s
mobile device. Text message services are provided on an “as is” basis. Data obtained from
Customer in connection with text message out-of-band authentication may include
Customer’s phone number, mobile phone number, Customer’s wireless carrier's name, and
the date, time, and content of Customer’s messages and other information that Customer
may provide. Bank may use this information to contact Customer and to provide Services
under these Terms and Disclosures, and to otherwise operate, develop, and improve the
Services. Customer’s wireless carrier and other service providers may also collect data from
Customer’s text message usage, and their practices are governed by their own policies. Bank
will only use the information Customer provides to the Service to transmit Customer’s text
message or as otherwise described in these Terms and Disclosures. Nonetheless, Bank
reserves the right at all times to disclose any information as necessary to satisfy any law,
regulation, or governmental request, to avoid liability, or to protect Bank’s rights or property.
When Customer completes forms online or otherwise provide Bank information in connection
with the Service, Customer agrees to provide accurate, complete, and true information.
Customer understands and agrees it is still subject to the terms and conditions of any
agreement Customer has with any unaffiliated third-party service providers, including, but not
limited to Customer’s mobile service provider (e.g., AT&T, Verizon, Sprint, T-Mobile, etc.) and
these Terms and Disclosures do not amend or supersede any of those separate third-party
service provider agreements. Customer understands that such Services may provide for fees,
charges, limitations and restrictions which might impact Customer’s use of the Services (e.g.,
data use charges, etc.), and Customer agrees to be solely responsible for all such fees,
charges, limitations and restrictions. Customer should contact its wireless carrier for
information about Customer’s messaging plan. Customer’s wireless carrier may impose
message or charge limitations on Customer’s wireless account that are outside of Bank’s
control. All charges are billed by and payable to Customer’s wireless carrier. Customer
agrees that only Customer’s phone service provider or mobile service provider is responsible
for the performance and operation of its products and services, including Customer’s phone
service, mobile device and the mobile service provider’s own network. Customer agrees to
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resolve any problems with its phone service provider or mobile service provider without
involving Bank.
K. THIRD PARTIES. Bank may contract with third party service providers or other parties with
respect to one or more of the Services or the provision of a Service or parts thereof. To the
extent applicable to Customer and made known to Customer, Customer, agrees to comply
with the requirements of the contracts between Bank and such third parties relative to the
Services. Bank may refer Customer to third parties for the provision of products or services
not offered by Bank. Customer acknowledges and agrees that such third parties are not
affiliated with or endorsed by Bank. Customer further agrees that Bank does not guarantee
such products or services and is not liable for the actions or inactions of any such third party.
L. THIRD PARTY NETWORKS. Bank's ability to provide certain Services is dependent upon its
ability to obtain or provide access to third party networks. In the event any third party network
is unavailable, or Bank determines, in its discretion, that it cannot continue providing any third
party network access, Bank may discontinue the related Service or may provide the Service
through an alternate third party network. In such circumstances, Bank will have no liability for
the unavailability of access. Customer expressly agrees that Bank may utilize third party
vendors that are located outside of the United States and, accordingly, Customer’s
information may be transmitted, processed or stored outside of the United States. In no event
will Bank be responsible for any services or equipment that Customer receives from third
party vendors.
M. USER AND TRAINING GUIDES. Bank may provide Customer with User Guides, Training
Guides, or other operating procedures (the “User Guides”) in connection with certain
Services. Customer agrees to: (1) comply with the User Guides that Bank provides to
Customer; and (2) take reasonable steps to protect the confidentiality and security of the
User Guides and any other proprietary property or information that Bank provides to
Customer in connection with the Services.
N. IMPORTANT DISCLAIMER AND INTELLECTUAL PROPERTY NOTICES. Bank endeavors
to provide Customer with the highest quality of treasury management Services available.
However, due to the unpredictable nature of the Internet, occasional inaccessibility to these
products should be expected. Additionally, Bank cannot and does not guarantee the
completeness or accuracy of the information provided herein. Bank reminds Customer that
the Internet lacks inherent security for commercial transactions and therefore Bank cannot
and does not guarantee that downloads from the Bank’s web site or the web site of any of
Bank’s Services will not contain a virus or other destructive device. Additionally, Customer
provides, requests, and receives information from these web sites with the knowledge that
such information can be intercepted and/or viewed by unknown third parties. Bank’s
Services, including software utilization and brand product names, are subject to applicable
trademark, copyright, patent, trade secret, trade dress, service marks and other worldwide
intellectual property rights, and Customer expressly agrees not to infringe upon or violate the
intellectual property rights of their respective owners or other third party rights associated with
the intellectual property rights. Bank reserves the right to terminate Customer’s access to the
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Services, in the event Customer infringes on any intellectual property rights of third parties.
Bank also reserves the right to remove any user content or any other material posted by a
user that is alleged to infringe upon the intellectual property rights of others. Features and
services availability are subject to change without notice.
O. DISPUTE RESOLUTION. In the event of any disagreement hereunder, or if conflicting
demands or notices are made upon Bank relating to the Implementation Agreement, any
Separate Agreement or any account subject to these Terms and Disclosures, Bank may, at
its option, refuse to comply with any claims or demands on it or refuse to take any other
action hereunder with regard to the subject matter of the dispute, so long as such dispute
continues; and in any such event, Bank shall not be, nor shall it become, liable to any person
for its failure or refusal to act, and Bank shall be entitled to continue to so refrain from acting
until: (i) the rights of all parties shall have been fully and finally adjudicated; or (ii) all
differences shall have been adjusted and all doubt resolved by agreement among all of the
interested persons. The rights of Bank under this paragraph are cumulative of all other rights
which it may have at law or otherwise.
P. EQUITABLE RELIEF; WAIVER OF JURY TRIAL; ARBITRATION. Customer and the Bank
shall have the right to apply to a court to enjoin any breach of this contract. For such
purpose, Customer and Bank hereby consent to the jurisdiction of Oklahoma state courts and
federal district courts located in Oklahoma County, Oklahoma. Each of Bank and Customer
hereby waive its right to trial by jury in respect of any dispute involving the other party hereto.
Excepting the right of Customer and Bank to seek equitable relief in court, all claims and
matters in question arising out of or related to the Implementation Agreement, these Terms
and Disclosures, or the relationship between Customer and the Bank created by the
Implementation Agreement, whether sounding in contract, tort or otherwise, shall be resolved
by binding, self-administered arbitration pursuant to the Commercial Arbitration Rules of the
American Arbitration Association (“AAA”), and all such proceedings shall be subject to the
Federal Arbitration Act. There shall be three arbitrators. Customer and the Bank shall each
designate an arbitrator, who need not be neutral, within 30 days of the notification of either
party's intent to proceed with arbitration. The two arbitrators so designated shall elect a third
arbitrator. If either Customer or the Bank fails to designate an arbitrator within the time
specified or the two parties' arbitrators fail to designate a third arbitrator within 30 days of
their appointment, the remaining arbitrator(s) shall be appointed by the AAA. The arbitrators
shall decide whether a particular dispute is or is not arbitrable. Customer and the Bank shall
pay for the expenses incurred by its designated arbitrator and the costs of the third, neutral
arbitrator shall be divided between Customer and the Bank. Only damages allowed pursuant
to this contract may be awarded and arbitrators shall have no authority to award punitive or
exemplary damages, Customer and the Bank hereby waiving their right, if any, to recover
punitive or exemplary damages, either in arbitration or in litigation. The arbitration shall take
place in Oklahoma City, Oklahoma. Any party that desires to enforce any arbitration award
granted hereunder may seek enforcement of the arbitration award only in, and such award
shall be enforceable only by, Oklahoma state courts or federal district courts located in
Oklahoma County, Oklahoma.
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Q. STOP PAYMENTS. Customer may request to stop payment on any check, draft, or ACH
transaction, and shall hold Bank harmless and indemnify Bank from any expenses or costs in
connection with Bank's refusing payment as instructed. Stop payment orders shall be
governed by, and Customer shall comply with, the applicable provisions of the Oklahoma
Uniform Commercial Code. Bank must receive stop payment orders before it has accepted,
certified, made final payment on or otherwise become accountable for the item or order, and
in time for reasonable action by Bank, and Customer must describe the item or order with
certainty. A stop payment will be effective for six months. Bank will charge a fee for each stop
payment order at agreed upon pricing. A request for a continuation on a stop payment order
is considered a new stop payment order resulting in an additional stop payment fee. The
continuation of a stop payment order must be requested prior to the expiration of the existing
stop payment order. Bank may accept a stop payment order from any authorized signer on
the Account, regardless of who signed the original item or initiated the original order, and
Bank will not be liable for such a stop payment request. A release of the stop payment
request must be made in writing by the person who requested the stop payment. Before
requesting a stop payment, Customer shall (a) determine whether the check, draft, or ACH
transaction or item has been paid, (b) verify for accuracy all data requested by Bank in
connection with the stop payment order, and (c) retain all information regarding stop payment
orders for at least six months from the date of each requested stop payment. A stop payment
request may be communicated to Bank in following ways:
1. Written Request: Customer may make a stop payment request in writing. Customer's
request must be received before 4:00 p.m. Central Standard Time, to be effective the
next Business Day.
2. Oral Request: Customer may also make an oral stop payment request. Bank will mail a
notice of the stop payment request that was placed to Customer. Customer must contact
the Bank within 14 calendars days from the date of the notice if any information in the
notice is incorrect, or if the Customer wishes to withdraw the request.
3. Electronic Request Transmitted via Bank's On-Line Treasury Management System:
Customer may also make a stop payment request through use of the Bank's on-line
Treasury Management System. Stop payment requests made via the Bank's on-line
Treasury Management System shall be considered written stop payment requests. A stop
payment request made on the Bank's on-line Treasury Management System before 4:00
p.m. Central Standard Time, will be effective on the next Business Day it is made.
Regarding checks, Customer may submit a single stop payment request or submit a stop
payment request on a range of checks through the Bank's on-line Treasury Management
System. Regarding ACH transactions, Customer may submit a stop payment request as
a one-time request or as a re-occurring request, and Customer must indicate such when
submitting the stop payment request. If Customer fails to indicate if the stop payment
request is a one-time request or a re-occurring request, the request will be treated as a
one-time request.
R. PAYMENT AND CHARGES. Customer agrees to pay all fees and charges owed to Bank
under the Implementation Agreement, these Terms and Disclosures, the Separate
Agreements, if any, and the Account Terms as such amounts become due. The Bank’s Fees
for Services are reflected at: http://www.banksnb.com/, the Implementation Agreement,
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and/or proformas provided by Bank to Customer. Customer acknowledges and agrees that
special or additional services performed by Bank at Customer's request may be subject to
additional terms and fees as Customer and Bank may agree. Customer shall maintain a
balance of collected funds in the various accounts subject to the Implementation Agreement,
these Terms and Disclosures, and any Separate Agreements sufficient to cover its payment
obligations to Bank hereunder, and Bank shall be entitled to debit each respective account for
payment of such charges. If at any time there are insufficient funds in the subject accounts to
pay amounts owed, Bank may, but is not obligated to, notify Customer and provide Customer
a reasonable period of time within which to deposit sufficient funds. If sufficient funds are not
deposited, Bank shall debit the subject accounts, or any other of Customer's accounts
maintained with Bank, into overdraft, and charge Customer an overdraft fee. Customer shall
repay any amounts so debited, including any overdraft fee and other costs of collection,
immediately upon demand. Any amounts debited by Bank which result in an overdraft to any
account subject to the Implementation Agreement, any Separate Agreement, and these
Terms and Disclosures, shall bear interest at eighteen percent (18%) per annum or the
maximum rate permitted by applicable law, whichever rate is lower. Bank shall not be liable
for any damages to Customer resulting from action taken by Bank under this provision. In
addition to any other remedy in law or equity, Bank may suspend or terminate Services if
Customer fails to pay any fees or charges when due, and Customer agrees to hold Bank
harmless and indemnify and defend Bank from and against any claim, damage, loss, liability
and cost arising from such suspension or termination of Services. In addition to the Services
fees, Customer agrees to pay for all taxes, tariffs and assessments levied or imposed by any
government agency in connection with the Services, the Implementation Agreement, any
Separate Agreement, these Terms and Disclosures, and/or the software or equipment used
by Customer (excluding any income tax payable by Bank). Customer is also responsible for
the costs of any communication lines and any data processing charges payable to third
parties.
S. EQUIPMENT. Customer shall be responsible for providing, maintaining, and bearing all costs
of all equipment located on Customer's premises that is necessary for using the Services,
with the exception of the Bank provided remote check capture scanning device(s).
Equipment includes without limitation, telephones, terminals, modems, computers and
computer software. Bank assumes no responsibility for defects or incompatibility of any
computers or software that Customer uses in connection with the Services.
T. SYSTEM REQUIREMENTS. The current system requirements for use and operation of the
various Services can be found at https://www.banksnb.com. Customer understands and
acknowledges that the system requirements may change from time to time without notice by
Bank to Customer and that Customer is responsible for ensuring that they meet the
requirements. Bank is not responsible for delivering a Service if the current system
requirements are not met by Customer.
U. NO INTERNET GAMBLING. The Unlawful Internet Gambling Enforcement Act of 2006
(“UIGEA”) prohibits any person engaged in the business of betting or wagering from
knowingly accepting payments in connection with the participation of another person in
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unlawful Internet gambling. Bank does not offer commercial account services to businesses
that engage in Internet gambling activities or that process transactions related to Internet
gambling activities. BANK PROHIBITS CUSTOMER FROM USING ANY ACCOUNT AT THE
BANK TO PROCESS ANY TRANSACTION RELATED TO INTERNET GAMBLING
ACTIVITIES AND RESERVES THE RIGHT TO TERMINATE ALL ACCOUNTS OF
CUSTOMER AT THE BANK, WITHOUT NOTICE, IF CUSTOMER VIOLATES THIS
PROHIBITION.
V. APPLICABLE LAW. This treasury management relationship between Customer and Bank
under the Implementation Agreement, any Separate Agreement and these Terms and
Disclosures shall be governed by and interpreted in accordance with the laws and regulations
of the State of Oklahoma (without regard to conflicts of law principles) and applicable federal
law, rules and regulations.
W. CONFIDENTIAL INFORMATION. The Services constitute Proprietary and Confidential
Information (as such term is defined below) of Bank or Bank's licensors, vendors, or ACH
third party service providers. Customer will not acquire any rights in the Services by virtue of
using such Services or otherwise. Customer shall not (1) make use of the Proprietary and
Confidential Information, or that of Bank's licensors, vendors, or ACH third party service
providers, other than as may be necessary to use a Service and then such use shall be
limited to that purpose for only so long as Customer uses the Service, or (2) disclose, divulge,
distribute, publish, reproduce or transfer Bank's Proprietary and Confidential Information, or
that of its licensors, vendors, or ACH third party service providers except to persons who
require access for Customer's use of the Services, or as required by law. Customer shall
protect the confidentiality of Bank's Proprietary and Confidential Information (using in any
case, not less than the efforts Customer uses to protect its own confidential information and
no less than a reasonable degree of care), and prevent any access to or reproduction,
disclosure or use of any of the Proprietary and Confidential Information. Customer shall not
modify, dissemble, decompile or create any derivative works from the Proprietary and
Confidential Information or create, design, manufacture, offer or sell any products or services
incorporating any Proprietary and Confidential Information. For purposes of the
Implementation Agreement and these Terms and Disclosures, “Proprietary and Confidential
Information” means any and all agreements, documents, data, records and other information
with respect to the Services, including the terms of the Implementation Agreement, any
Separate Agreement, and these Terms and Disclosures, fees charged for the Services, User
Guides, software and software licenses relating to the Services, user identification,
passwords, codes, keys, security devices, policies and procedures, embedded algorithms,
and other similar devices and information relating to the Services. Confidential and
Proprietary Information does not include information relating to the Services which is
generally available and known to the public and its availability was not the result of wrongful
or improper disclosure by Customer. Customer acknowledges that any unauthorized use or
disclosure of any Proprietary and Confidential Information would be likely to cause immediate
and irreparable damage to Bank and its Affiliates that could not be fully remedied by
monetary damages. Therefore, in addition to any other rights Bank may have at law or under
the Implementation Agreement, any Separate Agreement or these Terms and Disclosures,
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Customer agrees that Bank may specifically enforce the Implementation Agreement, any
Separate Agreement, and these Terms and Disclosures, and may seek such injunctive or
other equitable relief as may be necessary or appropriate to prevent such unauthorized use
or disclosure of Proprietary and Confidential Information, without the necessity of posting a
bond or proving actual damage by reason of any such breach or threatened breach of the
Implementation Agreement or these Terms and Disclosures.
X. DOCUMENTATION; OBLIGATION TO MAINTAIN RECORDS. Customer agrees to execute,
in a form and content satisfactory to Bank, any and all documentation required by Bank to
obtain and continue to receive Services. Customer also agrees to provide Bank with any and
all information and documentation reasonably requested by Bank to perform its obligations
under the Implementation Agreement, these Terms and Disclosures, and any Separate
Agreements, and to comply with applicable provisions of law or regulation, including without
limitation, the USA PATRIOT Act and its implementing regulations. Information and
documentation requested by Bank may include, without limitation, information regarding
Customer's financial condition, business operations and the nature and capability of
equipment owned and maintained by Customer for the purposes of accessing the Services.
Bank's performance of each Service hereunder is conditioned on Bank's receiving all data
and information it requires, in substance, form and quality and within the time frame required
by Bank or its third party service providers. In the event that required data or information is
not so provided, then (i) Bank will not be bound by any performance or delivery schedules set
forth herein, (ii) Bank may charge additional fees as appropriate, (iii) Bank may return
improper or incomplete information or data, and (iv) any services, reports, or information that
are delivered by Bank will be considered to be complete. Notwithstanding the Bank's
provision of Services hereunder, Customer remains obligated to maintain, in accordance with
applicable law, clearinghouse rules and contracts and agreements, including these Terms
and Disclosures, records, documents, data and information necessary for review and audit by
and reporting to Bank and all other applicable parties.
Y. SEVERABILITY. If any provision of any Separate Agreement or these Terms and Disclosures
is held to be invalid, illegal or unenforceable, such provision shall be deleted and the
remainder of the Separate Agreement and/or these Terms and Disclosures shall be enforced
as if such invalid, illegal, or unenforceable provision had never been contained herein.
Z. TERMINATION. Unless otherwise provided in any specific Service Terms or Separate
Agreement, the Parties may terminate the Implementation Agreement, with or without cause,
at any time with not less than 30 days' prior written notice. The Implementation Agreement
may be terminated immediately by Bank without notice to the Customer: (i) if required by law,
including without limitation, the USA PATRIOT Act; (ii) if Customer fails to comply with the
terms of these Terms and Disclosures; (iii) if Customer fails to pay when due any of the fees
provided for in these Terms and Disclosures, or any other agreement with the Bank; (iv) if
any Customer account subject to the Implementation Agreement or these Terms and
Disclosures is closed for any reason or is made the subject of a levy or garnishment,
attachment or similar process; (v) if any arrangement between Bank and any other entity
required to provide the Services under the Implementation Agreement, any Separate
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Agreement, or these Terms and Disclosures, including but not limited to, any Federal
Reserve Bank, is terminated; (vi) a payable item or a credit posting item, as the case may be,
has been returned due to incorrect or incomplete information given by Customer to Bank
regarding the payable item or credit posting item; (vii) an otherwise unauthorized ACH debit
item has been paid or an otherwise unauthorized ACH credit item has been accepted due to
incorrect or incomplete information given by Customer to Bank regarding the item; (viii) there
exists facts or circumstances that support the reasonable conclusion that Bank or Customer
is or may be subject to losses for fraud, other illegal activity, mistake, negligence, or the
communication of erroneous information arising from the actions of Customer or any third
party, including Customer’s employees or agents; may be unable in any respect to comply
with these provisions; (ix) the Customer fails to maintain adequate collected and available
balances to cover all transactions, costs and expenses relating to one or more Service(s); (x)
there is an occurrence of a material change in the Customer’s credit and/or risk analysis
criteria as determined by the Bank in its sole and absolute discretion; (xi) the Bank at any
time determines that the Customer does not meet the Bank’s risk or other qualification
requirements; or (xii) the Customer has selected a particular Service, but Customer has not
used such Service for a period of time deemed to constitute an inactive Service by Bank (in
Bank’s sole discretion). Termination of the Implementation Agreement subject to these Terms
and Disclosures will not affect any obligations or rights of the Parties which accrued prior to
termination. The provisions of Sections I.D, I.E, I.O, I.Q and I.R of these Terms and
Disclosures shall survive said termination.
AA. MODIFICATION/AMENDMENT. Bank shall notify Customer of any material modification or
amendment made to the Implementation Agreement, any Separate Agreement or these
Terms and Disclosures by any means and as soon as practically possible. Notwithstanding
anything herein to the contrary, except as required by law, Bank reserves the right to
increase or decrease any fee(s) for Services at any time without notice to Customer. Bank
may further modify any terms, conditions or operating procedures under the Implementation
Agreement, any Separate Agreement or these Terms and Disclosures without prior notice to
Customer, including any of the Services Terms incorporated herein, where an immediate
change is necessary to maintain or restore the security of Customer's accounts or the funds
transfer system. In the latter case, Bank shall provide Customer with a notice of change in
terms as soon as possible thereafter either by way of tangible or electronic means.
Customer's continued use or receipt of Services shall evidence Customer's acceptance of
such amended terms.
BB. NON WAIVER. Bank's waiver of any breach or failure to enforce any of the terms or
conditions of any Separate Agreement or these Terms and Disclosures at any time shall not
in any way affect, limit or waive Bank's right thereafter to enforce strict compliance with every
term and condition hereof. Customer may be obligated to Bank under certain loan
agreements and related instruments (the “Loan Documents”). Conflicts, if any, between the
provisions of the Loan Documents and the provisions of any Separate Agreement or these
Terms and Disclosures shall be resolved in favor of the Loan Documents.
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CC. NOTICE; COMMUNICATIONS. Except as otherwise noted in any Separate Agreement or
these Terms and Disclosures, all notices required or permitted under said documents shall be
in writing and shall be deemed to have been given when delivered by hand, via confirmed
telecopy, or when mailed by United States mail, registered mail or certified mail, return
receipt requested. Notices to Customer may be mailed or delivered to the Customer's
statement, email or mailing address as reflected on the Bank's system of record, may be
posted within the Bank's online Treasury Management System, Third-Party provided
software or any combination of the foregoing notification methods. Notices to Bank must be
mailed or delivered to the following:
Bank SNB Attn: Customer Solution Center P O Box 1988
Stillwater, OK 74076 Either party may change its address for notification purposes by giving the other party prior written notice of the new address and the date upon which the address will become effective. At its option, for quality assurance, training, and confirmation purposes, Bank may monitor and record telephone conversations with its customers, including Customer. Customer agrees that Bank shall have no liability for monitoring or recording, or not monitoring or recording, telephone conversations with Customer.
DD. HEADINGS. Paragraph headings are used for identification purposes only and are not
intended to limit the content thereof.
EE. ENTIRE AGREEMENT. The Implementation Agreement, these Terms and Disclosures, and
any applicable Separate Agreement constitutes the entire agreement between Bank and
Customer as it relates to the rendition of Services and, except as otherwise stated herein and
with the exception of any Loan Documents, supersedes any and all other agreements either
oral or written between the Parties with respect to the subject matter hereof. Customer
acknowledges that it has not relied on any oral representations of any Bank officer, director or
employee in entering into the Implementation Agreement or any Separate Agreement. The
Implementation Agreement, any Separate Agreement and these Terms and Disclosures
incorporate by reference all corporate resolutions, Separate Agreements and Account Terms
with Bank, and any applicable User Guides or operating procedures for the Services
regardless of whether such agreements or other documents have been executed by
Customer.
FF. ASSIGNMENT. Customer may not assign its rights under the Implementation Agreement,
any Separate Agreement or these Terms and Disclosures without the prior written consent of
Bank.
GG. JOINT AND SEVERAL AUTHORITY TO COMBINE FUNDS; REPRESENTATIONS AND
WARRANTIES. If more than one party joints in one or more Services, the contractual
obligations shall be the independent obligations of each party, the obligations hereunder
being joint and several. Further, for purposes of these Terms and Disclosures and
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Implementation Agreement, each party is separately defined as Customer. Each party
agrees that there is no expectation of privacy between the entities that have joined in the
Services. Each party hereby represents and warrants to Bank that any and all transfers and
commingling of funds required or permitted by any Services, and all other aspects of the
performance hereof by the parties, have been fully authorized by law and by all necessary
parties, including, without limitations, the account holder of each account and that each
Customer have obtained and shall maintain in Customer’s regular business records and
make available to Bank upon reasonable demand, adequate documentary evidence of such
authorization form the account holder of each account, executed by the duly authorized
officer(s) of each such account holder in accordance with that account holder’s corporate
bylaws and board resolutions. Each representation and warranty contained herein shall be
continuing and shall be deemed to be repeated upon Customer’s use of the Services and
Bank effecting each transfer and commingling of funds.
II. BUSINESS BILL PAY SERVICE TERMS
A. SERVICES. Bank agrees to provide Business Bill Pay Services to Customer with respect to
the accounts that customer has designated on forms provided by the Bank. Bill Payment is a
service provided through the Treasury Management System, by the Bank or an independent
third party, for use of the Bill Pay Service are presented at time of on-line enrollment and
require acceptance before Customer’s bill payment service is activated. These Terms and
Conditions can also be accessed at any time from the Treasury Management System from
the Bill Payment Help menu. Online bill payment is provided to Customer for Customer’s
convenience. The actual payment of such bills may be handled by an independent third
party, and Bank cannot and will not guarantee or be held responsible for the completion and
accuracy of such transactions.
III. AUTOMATED ACCOUNT SWEEP SERVICE TERMS
A. DEFINITIONS. The following words or phrases in this Section shall have the following
meanings:
1. Available Credit. At any time the principal amount available to Customer under the terms of
the Line of Credit, which will at no time exceed the stated principal amount of the Note, less
the principal amount thereof then outstanding.
2. Available Funds. The net funds eligible to be swept from the Sweep Target Account(s) at
the end of a Business Day after taking into account all deposits and checks and other items
drawn on the Account. The funds availability policy of Bank will apply to deposits in the
Sweep Target Account.
3. Destination Account. The account at Bank, as shown in the Implementation Agreement,
that Customer has designated as being covered by the Sweep Service described herein
and on which Customer authorizes Bank to transfer Available Funds, on a daily basis, to or
from a Sweep Target Account in order to achieve the selected sweep of funds. The
Destination Account may be an Interest Bearing Account if the Sweep Service selected is
an Interest Bearing Account Sweep; the Destination Account may be the Line of Credit
Account if the Sweep Service selected is a Commercial Loan Sweep; the Destination
Account may be another account at Bank if the Sweep Service selected is a Zero Balance
or Target Balance Sweep.
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4. Loan Documents. The Promissory Note (“Note”) and any business loan agreement,
mortgage, commercial security agreement, or other document or instrument executed in
connection with the note evidencing the Customer’s line of credit provided by Bank as
designated on the Implementation Agreement (“Line of Credit”).
5. Sweep Service. The specific sweep option designated by Customer on the Implementation
Agreement.
6. Sweep Target Account. An account at Bank, as shown on the Implementation Agreement,
which Customer has designated as being covered by the Sweep Service described herein
and on which Customer authorized Bank to transfer out on a daily basis funds in the
amount of any Target Balance Excess, and/or in some Sweep Services to transfer funds in
the amount of any Target Balance Shortfall so that at the opening of each Business Day
the Sweep Target Account will have the Target Balance.
7. Target Balance. The Available Funds balance designated on the Implementation
Agreement that Customer wishes to maintain in the Sweep Target Account and above
which Bank will sweep funds out of the Sweep Target Account and into which Bank may
sweep funds. For the Zero Balance Sweep Service, the Target Balance will be zero.
8. Target Balance Excess. The amount of Available Funds in the Sweep Target Account at
the end of any Business Day in excess of the Target Balance.
9. Target Balance Shortfall. On any Business Day, the amount by which the Available Funds
balance in the Sweep Target Account is less than the Target Balance.
10. Relationship Sweep Available Balance. The combined Available Funds balance
considering all related Sweep Target Account(s) and Available Credit under the terms of a
Line of Credit.
B. SWEEP SERVICES. If Customer has elected to receive Sweep Service, Customer
authorizes Bank and Bank agrees to transfer money from one or more of Customer's
Accounts in accordance with the sweep option(s) designated in the Implementation
Agreement. Bank offers the following Sweep Service options:
1. Zero Balance Account Sweep
2. Revolving Line of Credit Sweep
3. Cash Sweep
4. Insured Deposit Sweep
Sweep Services are automatic and occur on any Business Day after the final posting of items
in Sweep Target Account, with the exception of service charges.
C. ZERO BALANCE ACCOUNT SWEEP. The Zero Balance Sweep Service will transfer on
each Business Day to the Destination Account any Target Balance Surplus from any Sweep
Target Account (for this purpose, referred to as a “Zero Balance Account”) designated by
Customer, and to transfer, on each Business Day, from the Destination Account to the Zero
Balance Account amounts necessary to cover any Target Balance Shortfall in any Zero
Balance Account so that at the beginning of each Business Day, each Zero Balance Account
designated by Customer, will have an Available Funds balance of either zero ($.00) or the
Target Balance, as determined by the Customer.
1. Zero Balance and Destination Accounts. Customer shall make arrangements for there to
be sufficient Available Funds in the Destination Account to cover all items drawn on the
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Zero Balance Account presented for payment on the Business Day on which
presentments are made. Items drawn on the Zero Balance Account shall conform to
check specifications provided by Bank to Customer. Issuance of items, which have not
received Bank’s prior approval as to compliance with Bank’s check specifications, may
result in charges for extra processing.
2. Transfers, Credit and Returns. Bank will automatically transfer funds from the
Destination Account to the Zero Balance Account to cover items that are presented for
payment. To the extent that such Available Funds, in the Destination Account, are
insufficient to cover such items, Bank is authorized to transfer Available Funds by
provisional credit to the Zero Balance Account in an amount equal to the total of all
amounts payable on all items, which are presented to Bank. If the Available Funds on
deposit in the Destination Account are insufficient for such purpose, Bank may at its sole
discretion revoke the provisional credit to the Zero Balance Account and return Items
which created such provisional credit unpaid, or Bank may in its sole discretion
provisionally advance the necessary additional funds to the Customer and transfer such
provisional credit in the amount thereof to the Zero Balance Account (any such transfer or
provisional credit shall remain revocable, at all times, by Bank in its sole discretion prior
to midnight of the day following presentment of the items). If Bank should provisionally
advance any funds to Customer, such action shall not establish a course of dealing
between the parties that shall require Bank to provisionally advance any additional funds.
If Customer fails to repay any such provisional advance, Bank shall, without any
requirement of prior notice to Customer, automatically reverse such provisional credit,
initiate a debit in the amount of the original advance to the Zero Balance Account, and
return any or all affected Items unpaid. Bank also may return any Items, which Bank
determines, are not properly payable.
D. REVOLVING LINE OF CREDIT SWEEP
1. Loan Sweep. Bank will sweep funds out of the Sweep Target Account as described
below as provided in the Implementation Agreement.
(i) If there is a Target Balance Excess at the end of a Business Day, Bank will (A) debit
the Sweep Target Account for the amount of any unpaid principal balance under the
Note, up to the amount of the Target Balance Excess, and (B) apply the amount of
the debit to the unpaid balance of the Note.
(ii) In no event will Bank debit the Account pursuant to the Implementation Agreement to
pay any interest that shall accrue under the Note, but this shall not affect Bank’s right
to set-off against the Account any monies due Bank under the Note, including, but
not limited to, principal and interest, and Bank hereby expressly reserves such right
of set-off and any other rights under the Loan Documents.
2. Extension of Credit under Note. Bank will sweep funds back into the Sweep Target
Account as provided in these Terms and Disclosures and Implementation Agreement
according to the following terms and in the following order:
(i) If there is a Target Balance Shortfall, Bank will extend credit to the Customer to the
extent provided in subparagraphs (ii) and (iii) below.
(ii) If the Available Credit at such time equals or exceeds the Target Balance Shortfall,
Bank will (A) extend credit to the Customer by making an advance under the Note in
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the amount of the Target Balance Shortfall and (B) credit the amount of the advance
to the Sweep Target Account to eliminate the Target Balance Shortfall, as applicable.
(iii) If the Available Credit at such time is less than the Target Balance Shortfall, Bank will
(A) extend credit to Customer by making an advance under the Note in the amount of
the Available Credit and (B) credit the amount of the advance to the Sweep Target
Account to reduce the Target Balance Shortfall.
3. Advances. All advances under the Note made pursuant to the Terms and Disclosures
and Implementation Agreement shall be evidenced by, bear interest at the rate provided
in and be repaid in accordance with the terms of the Note and shall be secured by any
and all collateral security the Note. In no event shall Bank have any obligation to make
advances under the Note in excess of the Available Credit.
4. Authorizations. Customer authorizes Bank to charge and credit the Account, make
advances and payments on behalf of Customer under the Note in accordance with the
terms these Terms and Disclosures and Implementation Agreement, all without further
notice to or authorization by the Customer or any authorized person, if any, identified in
the Note.
5. Effect on Loan Documents and Other Agreements. The terms of the Loan Documents
are hereby modified to include the terms and provisions of these Terms and Disclosures
and Implementation Agreement, including, without limitation, Section III.E.1. and E.2.
hereof. However, these Terms and Disclosures and Implementation Agreement are not
intended to and shall not be construed to modify or supersede the Loan Documents or
the respective rights and obligations of the Customer and Bank as therein provided or
any other agreements, terms, conditions, rules or regulations of Bank as may be
applicable to the Line of Credit or the Sweep Target Account, including, without limitation,
any requirements relating to minimum balances and service or other charges. In the
event of any conflict between these Terms and Disclosures and Implementation
Agreement and Loan Documents, the Loan Documents will prevail with respect to the
Line of Credit.
E. CASH SWEEP. Under this Sweep Service, Bank will sweep any Target Balance Excess in
the Sweep Target Account on any Business Day in accordance with the Implementation
Agreement to a Destination Account that is an Interest Bearing Deposit Account. Funds will
automatically sweep back to the Sweep Target Account, subject to maximum limitations
established by law.
F. INSURED DEPOSIT SWEEP.
1. Introduction. Under the Insured Deposit Sweep Program ("the Program") any amount
on deposit at Bank that exceeds the target balance agreed upon between Customer and
Bank (“Target Balance”) will be swept to other insured accounts at FDIC member banks.
Customer’s funds will be deposited in money market deposit accounts and/or demand
deposit accounts (together, “DDA”) with those receiving banks (“Receiving Banks” or
“banks”, and Customer’s funds in these banks are hereinafter referred to as “Program”),
subject to the limitations described herein. By selecting the Program, Customer appoints
Bank as its authorized agent pursuant to the Terms and Conditions set forth herein.
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Bank will operate the Program with one or more third-party companies. There is no
minimum amount required as an initial or subsequent deposit.
By participating in this Program, Customer can increase the FDIC protection on its
deposit while continuing to process all its transactions with a single bank relationship.
From time to time, Bank will notify Customer of the maximum amount of FDIC insurance
protection available on Customer’s Program Deposits. Such maximum amount will
depend on the number of Receiving Banks in the Program and the number of Receiving
Banks that Customer excludes from holding its Program Deposits, and so may change
from time to time.
CUSTOMER UNDERSTANDS THAT BY ENROLLING IN THE PROGRAM BY
EXECUTING THE CUSTOMER AUTHORIZATION AND AGENCY APPOINTMENT
FORM, CUSTOMER IS INSTRUCTING BANK TO DIRECT THE AMOUNT OF ITS
FUNDS ON DEPOSIT WITH BANK THAT EXCEEDS THE TARGET BALANCE
AGREED UPON BETWEEN BANK AND CUSTOMER TO THE PROGRAM DEPOSITS
AT THE RECEIVING BANKS THROUGH A THIRD-PARTY COMPANY.
CUSTOMER ACKNOWLEDGES THAT IT HAS RECEIVED AND CAREFULLY READ
THESE TERMS AND CONDITIONS AND ANY OTHER APPLICABLE TERMS AND
CONDITIONS, WITH RESPECT TO INTEREST RATES IN CONNECTION WITH
CHOOSING TO ENROLL IN THE PROGRAM. IF CUSTOMER HAS ANY QUESTIONS,
PLEASE CALL BANK.
2. Summary of Terms and Conditions. This section is a summary of certain features of
the Program. It is prepared for Customer’s convenience, and must be read in conjunction
with any applicable terms and conditions.
A Summary of the Program: A third-party company (“Company”) operates the Program,
and Bank acts as Customer’s agent. If Customer chooses to participate, Bank will sweep
any amount on deposit at Bank that exceeds the Target Balance to the Receiving Banks,
with no single bank holding deposits of yours in excess of the FDIC-insured limit, subject
to the limitations described herein. Customer receives interest on its Program Deposits
at the rate established by Bank.
FDIC Insurance: Customer’s funds are deposited into DDA at multiple Receiving Banks
in a manner designed to remain within the $250,000 FDIC insurance for each Receiving
Bank, which in the aggregate increases the amount of FDIC protection available to
Customer. Company allocates Customer’s funds among the Receiving Banks to
maximize FDIC deposit insurance coverage. FDIC coverage is available up to its
standard maximum deposit insurance amount (“SMDIA”), which is $250,000 per legal
category of account ownership at each bank when aggregated with all other deposits
held by Customer in the same bank and in the same legal category of account
ownership.
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Company reserves the right to change the banks in the Program and the number of
banks to which Customer’s funds may be directed, providing Customer with more or less
total coverage under the Program, at the discretion of Company from time to time.
Company will notify Bank if it changes the amount of total coverage available to
Customer under the Program.
Company has standing instructions with each bank to ensure that Company maintains
control over Customer’s funds at all times. Company allocates among the Receiving
Banks to maximize FDIC coverage. However, any money that Customer holds outside
the Program at a Receiving Bank will impact Customer’s FDIC coverage as neither
Company, Bank nor any Receiving Bank monitors or takes any responsibility for money
Customer may have at a Receiving Bank outside the Program. Customer is solely
responsible for monitoring this. As such, Customer should review carefully the list of
Receiving Banks provided to Customer upon selection of the Program. In addition, a list
of Receiving Banks holding Customer’s money will be noted on Customer’s monthly
account statement. The list of Receiving Banks may change from time to time, and
Customer may contact Bank directly to obtain the most recent list. Customer has the
right to instruct Bank not to allocate Customer’s money to a particular Receiving Bank.
Access to Funds: Customer will access funds through Customer’s deposit accounts at
Bank. Customer’s account statements will list the names of the Receiving Banks holding
Customer’s money and month-end balance.
Determination of Interest Rates: Customer’s interest rate on funds deposited through the
Program is set by Bank. Customer must contact Bank with any questions about
Customer’s rate.
Company’s Fees: Company earns fees based on the amount of money in the Program,
including Customer’s money.
Risks of the Program: Receiving Banks are permitted to impose a seven-day delay on
any withdrawal request. In the event of a failure of a Receiving Bank, there may be a
time period during which Customer may not be able to access its money. If Customer
has money at a Receiving Bank outside the Program, this will negatively impact the
availability of FDIC insurance for the total amount of Customer’s funds held within and
outside the Program. If Customer’s deposits in a Receiving Bank exceed the then
current SMDIA of such bank, the excess funds are not covered by the FDIC deposit
insurance.
On each business day, Bank will sweep the deposit balances that exceed the Target
Balance, and transfer the funds to the Program on the following business day. Company
will allocate such funds to a number of Receiving Banks to maximize FDIC insurance. As
a result, such funds may be uninsured on the day of the sweep because they remain in
Bank overnight. However, the funds will be insured once they are transferred to the
Program. Similarly, when Customer’s funds are swept to the Program to the extent they
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exceed the current SMDIA, they will be uninsured for a limited period of time intraday as
the funds await movement to the Receiving Banks. Company has adopted procedures
and controls to ensure the movement of funds in a timely manner each day and expects
that Customer’s funds will be received by the Receiving Banks by the close of business
each day. However, if contrary circumstances occur and Customer’s funds are not sent
to the Receiving Banks in a timely manner, Customer’s funds could, to the extent they
exceed the current SMDIA, be uninsured until the next business day.
G. FEES AND CHARGES. The charge for the Sweep Service is set for in the Implementation
Agreement, and may be amended from time to time.
H. GARNISHMENTS. In the event a writ of garnishment is served on the Bank targeting funds in
the Sweep Target Account, the Bank shall have the right, in its sole discretion, to: (1) freeze
and/or place a hold on the Sweep Target Account an amount equal to the amount sought by
the garnishor until the writ of garnishment is satisfied; and/or (2) pay the full amount sought
by the writ of garnishment using funds from the Sweep Target Account. The Bank’s exercise
of these remedies shall not waive any other rights Bank may have under these Terms and
Disclosures.
IV. FUNDS TRANSFER SERVICE TERMS
A. PAYMENT ORDER. Customer has requested that Bank provide funds transfer services to
Customer to allow Customer to initiate transactions on Authorized Accounts, as defined
hereafter, through Customer's Authorized Agents, as defined hereafter. Any request by an
Authorized Agent for a transfer of funds, or any amendment or modification to, or cancellation
of, that request, is referred to in these Service Terms as a “Payment Order.” Upon receipt of
documentation deemed satisfactory to Bank in its sole discretion, Customer may permit third
parties to initiate a reverse funds transfer with the effect of debiting Customer's account at
Bank and crediting the third party's account in accordance with the authorized Payment
Order. Customer’s fund transfers shall be subject to the transaction limits contained in the
Implementation Agreement.
B. ACCOUNTS. Customer has designated any and all Accounts (“Accounts”) by use of
Customer's specific Taxpayer ID number(s) with Bank from which Payment Orders may be
initiated. The Taxpayer ID numbers are designated on the Implementation Agreement.
C. AUTHORIZED AGENTS. The term Authorized Agents is broadly defined to include both
persons designated by Customer on a Wire Transfer/Payment Order Agreement to initiate
Payment Orders from Customer’s Authorized Accounts and persons designated by
Customer’s online Treasury Management System Administrator responsible for electronically
designating Authorized Agents to initiate Payment Orders from the Customer’s Authorized
Accounts through Bank’s online Treasury Management System. Customer and/or Customer’s
online Treasury Management System Administrator designations of Authorized Agents shall
control, govern and be binding on Customer and Bank.
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D. FUNDS TRANSFER OPTIONS. Customer may initiate Payment Orders on a random, as
needed basis (“Standard Transfer”) and/or may establish a predetermined, preauthorized
schedule of Payment Orders (“Repetitive Transfer”). In the event Customer elects to utilize
the Repetitive Transfer option, Customer may vary the date and amount of the Payment
Order; however, accounts designated to be debited and credited may not vary.
E. SECURITY PROCEDURES. Customer has been advised of and agrees to comply with
Bank's Funds Transfer Security Procedures, as described in Section I.G of these Terms and
Disclosures. The Customer's failure to comply with the Bank's applicable security procedures
shall result in Customer being responsible for any liability, loss or damage resulting from the
failure to comply with the Bank's Security Procedures. The Bank will only accept a funds
transfer request that is being made using the appropriate Security Procedures and codes.
The Security Procedures to initiate Online Wire Transfers are as follows: (i) the customer will
use the appropriate User ID and PIN number (access code); and (ii) a unique PIN number will
be assigned for each Wire initiated either through a template or a one-time transfer through
our Out-of-Band Authentication “OOBA” call; and (iii)the transaction must have Dual-
Authentication – an initiator and approver as provided in the Implementation Agreement.
F. CONFIRMATION ACCOUNT RECONCILIATION. The Bank will send the Customer a receipt
of each executed Wire Transfer request the following business day through the requested
delivery as specified in the Implementation Agreement. The wire debit will also appear on the
periodic Deposit Account statement sent to the customer.
G. FUNDS TRANSFER PROCEDURES. Bank will receive Payment Orders and incoming funds
transfers on Business Days between the hours of 8:00 a.m. and 5:00 p.m. Central Standard
Time, and will send outgoing fund transfers on Business Days between the hours of 8:00
a.m. and 3:00 p.m. Central Standard Time. Bank will use reasonable efforts to execute all
Payment Orders received in accordance with these Service Terms and the terms of the Wire
Agreement, and by the date designated by Customer, provided that such Payment Orders
are received on the days and during the hours of Bank's operations as set forth above. Bank
will not be deemed to have accepted a Payment Order until such Payment Order is actually
executed. For purposes of these Service Terms, a Payment Order is deemed executed once
Bank issues an order intended to initiate the Customer's Payment Order through a funds
transfer system. Bank may use any means and routes that Bank, in its sole discretion, may
consider suitable for the transfer of funds, including but not limited to the Fedwire funds
transfer system for the transfer of domestic funds. If Customer requests, Bank will use
reasonable efforts to notify Customer of incoming funds transfers, but shall have no liability to
Customer of any kind for failure to do so. Bank may reject a Payment Order in the event: (i)
Customer fails to submit the Payment Order in sufficient time to meet the Customer's
requested execution date; (ii) there are insufficient funds in the Authorized Account(s) to
cover the amount of the Payment Order; (iii) the Payment Order contains incomplete
instructions; (iv) Bank is unable to verify to its satisfaction that the Payment Order has been
submitted in accordance with all applicable Security Procedures; or (v) Customer has failed
to meet its obligation for payment of fees and charges owed to Bank under these Terms and
Disclosures and/or the Wire Agreement. In the event a Payment Order is rejected, Bank will
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make reasonable efforts to notify Customer by telephone, and if unable to do so, will notify
Customer in writing. If Bank does not receive Customer's corrected Payment Order within
five (5) business days from the date the original Payment Order was initiated, Bank will deem
the Payment Order canceled by Customer. Bank shall not be liable to Customer if any
Payment Order is rejected by Bank in good faith for any of the foregoing reasons. Bank's
liability for failure to execute a Payment Order, if any, shall be limited as set forth in these
Services Terms and the Wire Agreement. Funds from incoming transfers will not be deemed
collected or credited to the Authorized Accounts or other accounts of Customer maintained at
Bank until such time as Bank receives final settlement through the Federal Reserve Bank
funds transfer system, or otherwise receives payment as provided in the Oklahoma
enactment of Article 4A of the Uniform Commercial Code or other applicable law.
H. ACCOUNT-TO-ACCOUNT TRANSFERS. Customer's account to account transfers also
constitute Payment Orders. All Payment Orders initiated by Customer must be initiated in
compliance with Bank's Security Procedures set forth in Section I.G of these Terms and
Disclosures.
V. AUTOMATED CLEARING HOUSE (“ACH”) ORIGINATION SERVICE TERMS
If Customer has requested, and Bank has agreed to permit Customer to initiate electronic credit and/or debit entries by means of the Automated Clearing House Network (the “ACH Services”), Customer agrees to comply with the following:
A. NATIONAL AUTOMATED CLEARING HOUSE ASSOCIATION (“NACHA”) TERMS AND
PROVISIONS. Customer and Bank agree to the following terms and provisions and agree
that capitalized terms not defined herein shall have the meaning ascribed to them in the
NACHA Operating Rules ("Rules").
1. Account or Originator's Account. Any Account maintained at Bank owned by the
Originator which may or may not be used as the Offset Account. Originator shall
designate the respective "Account(s)" and/or Entities on the Originator Setup Request
Form, or another form, provided by Bank.
2. ACH. The ACH Network is a secure, private network that connects banks to one another
by way of the Federal Reserve Board or other ACH operators. This network enables
electronic payments, such as direct deposit to be received and processed.
3. ACH Network. The ACH Network is a highly reliable and efficient nationwide batch-
oriented electronic funds transfer system governed by the Rules which provide for the
interbank clearing of electronic payments for participating depository financial institutions.
The Federal Reserve and Electronic Payments Network act as ACH Operators, central
clearing facilities through which financial institutions transmit or receive ACH Entries.
4. ACH Operator. An ACH Operator is the ACH participant that provides clearing, delivery,
and settlement services for ACH Entries. The primary function of the ACH Operator is to
accept ACH files containing ACH Entries from the ODFI and to sort and distribute such
ACH files to the RDFI. The Federal Reserve Bank acts as the ACH Operator although a
private sector can act as the ACH Operator when it executes an annual agreement with
NACHA binding it to the Rules (except to the extent inconsistent with the policies or
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practices of the Federal Reserve Banks) and to other applicable laws. The Federal
Reserve Bank is the ACH Operator for the Bank.
5. ACH Third Party Sender. An entity that has a contractual relationship with an ODFI to
transmit debits or credits to the account of a Receiver on behalf of the Originator.
6. ACH Third Party Service Provider. A contractor or other service provider directly or
indirectly retained by the Originator to initiate any ACH Entry, Batch and/or File to the
Bank or Bank's agent.
7. Balanced Batch. A Balanced Batch results when the Entries (debit and/or credit) within
the ACH Batch equal to the total amount debited or credited to the Offset Account within
the same ACH Batch.
8. Batch. Batch represents one or more ACH Entries that make up a single unit, "Batch".
Each Entry within the Batch will have the same Effective Date and the same payment
type (SEC Code). A Batch is not only characterized by each ACH Entry within the Batch,
but also by the entity initiating the Batch. Chapter VIII, "Mapping" of the Rules provides
complete details with regard to fields that make up a Batch.
9. Business Day. A Business Day is any day that the Bank is open to the public for carrying
on substantially all of its business (Saturday, Sunday and Federal holidays are
nonbusiness days).
10. DDA. A Demand Deposit Account is one and the same as a checking account and
represents a transaction account that is not limited by the number of transactions.
11. Effective Date. The Effective Date is the date the Originator and Receiver wishes the
ACH Entry or Entries to post to the Receiver's account(s). When an Entry or Entries
contains an invalid Effective Date (falls on a non-Business Day or released after the
current Business Day's Cut-Off Time), it will process on the next available processing
day, with a Settlement Date of one to two (1 to 2) Business Days from the process date.
12. Entry or Entries. A debit and/or credit ACH Entry or Entries represent individual
transactions that make up an ACH Batch. ACH Entry or Entries, for purposes of this
Section, shall also represent any ACH data received from the Originator, including, but
not limited to, Prenotifications.
13. File or Files. A File or Files represent one or more ACH Batches as a single unit. When
the Originator utilizes the Bank's Treasury Management System, the Bank receives the
Batch or Batches from the Originator and creates a subsequent File. When the Originator
uploads its Batch or Batches from its core system or via its Third-Party Service Provider,
the Originator and/or Third-Party Service Provider uploads a complete File made up of
one (1) or more Batches to the Bank for processing.
14. File Reversals. A File Reversal (and/or Batch) can only be initiated to correct the initiation
of a File (or Batch) where the majority of the ACH Entries were erroneous or it was a
duplicate File (or Batch), in which a correcting File must be initiated on the same day as
the File Reversal. A reversing ACH Entry is similar to a File Reversal except the
Originator is only reversing an ACH Entry and not an entire File. Chapter IV, "Reversals,
Reclamations, and ODFI Request for Return," of the Rules (Operating Guidelines)
provide details on the requirements of the File Reversal process. Otherwise, once an
ACH Entry or Entries have been introduced into the ACH Network, it cannot be reversed.
15. NOC. A Notification of Change ("NOC") is a non-dollar ACH Entry initiated by the
Receiving Depository Financial Institution ("RDFI") to the ACH Operator for distribution
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back to the Originator through the ODFI. Chapter II, "Notifications of Change," of the
Rules (Operating Guidelines) provides details of the NOC process, including, but not
limited to, time requirements. The Originator is required to investigate the incorrect data
and make the correction to the ACH Entry, when applicable, within six Business Days
from receipt of the NOC from the ODFI or prior to initiating the next ACH Entry to the
Receiver, whichever is later.
16. ODFI. The ODFI is the ACH participant (Financial Institution) that has executed a written
agreement with the Originator to transmit ACH Entries, Batches, and/or Files into the
ACH Network on behalf of the Originator. For the purpose of this Section, Bank , is the
ODFI.
17. OFAC. The U.S. Treasury Department's Office of Foreign Assets Control (“OFAC”)
administers economic sanctions and embargo programs that require assets and
transactions be frozen which involve interests of target countries, target nationals, and
other specifically identified companies and individuals. For purposes of OFAC
compliance, these entities are referred to as "Specially Designated National and Blocked
Persons." OFAC maintains and regularly updates a master list ("SDN List") identifying
known "blocked parties." Chapter IV, "OFAC Compliance," of the Rules (Operating
Guidelines) provides details of OFAC requirements. To review the current SDN List or
other OFAC details, visit http://www.treasury.gov.
18. Originator. The Originator is the ACH participant that initiates ACH Entries, Batches,
and/or File into the ACH Network through a relationship with the ODFI. The Originator is
responsible for funding upon submission of the ACH Entry, Batch, and/or File. For
purposes of this Section, the Originator is a corporate entity also known as "Company."
19. Prenotification. A Prenotification (Prenote) is a non-dollar ACH Entry initiated by the
Originator to the RDFI prior to the initiation of the first credit or debit Entry to a Receiver’s
account with the RDFI. A Prenotification notifies the RDFI that an Originator intends to
initiate one or more credit or debit Entries to a Receiver’s account with that RDFI in
accordance with the Receiver’s authorization. Prenotifications are optional, but Bank
strongly recommends use for payroll and other important ACH Entries. When the
Originator chooses to Prenote, the Prenotification must be initiated at least three
Business Days ahead of the first live ACH Entry. Chapter I, "Prenotifications" of the Rules
(Operating Guidelines) provides details of the Prenotification process.
20. Provisional Credit. Provisional Credit is a provision of UCC 4A. A credit may be
considered provisional", provided: (1) an ACH Operating Rule makes such payment
provisional and that the rule requires both the Originator and the Receiver to be given
prior notice of the provisional nature of the payment; and (2) the ODFI, RDFI, and
Receiver have agreed to be bound by the Operating Rule.
21. RDFI. The RDFI is the ACH participant (Financial Institution) that receives the ACH File
from the ODFI through the RDFI's ACH Operator on behalf of the Receiver of which holds
an account with the RDFI.
22. Receiver. The Receiver is the ACH participant that is the final recipient of the ACH Entry
or Entries. A Receiver can be an individual, corporation, or other entity that has
authorized an Originator to initiate a credit and/or debit ACH Entry to an account held at
the RDFI.
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23. Return. A Return is any ACH Entry that has been Returned to the Bank on behalf of the
Originator by the RDFI or ACH Operator as unpaid or rejected, respectively, because it
cannot be processed. The course of action required by the Originator to handle the return
is dependent upon the reason of the return, as indicated by the return code. Chapter III,
"Returns, Dishonored Returns, and Contested Dishonored Returns," of the Rules
(Operating Guidelines) provides a current list and definitions of Return Reason Codes,
Dishonored Return Reason Codes, and Contested Dishonored Return Reason Codes.
24. SEC Code or ACH Payment Type or ACH Type. An SEC code is a three-character code
that identifies the specific payment related information relevant to the application. Each
ACH Batch will have one SEC code, which appears within the Company/Batch Header
Record. SEC code stands for "Standard Entry Class" code.
25. Settlement Date. The Settlement Date represents the date on which the actual transfer of
value, or funds, between the ODFI (on behalf of the Originator) and the RDFI (on behalf
of the Receiver) have exchanged ACH transactions. The Originator is required to provide
funding on, or as otherwise provided in accordance with ACH Block and Transaction
Filtering Authorization, on the Settlement Date.
26. Transaction Limits. Customer’s ability to utilize ACH Services shall be subject to the
transaction limits specified and agreed to by Customer in the Implementation Agreement.
B. GENERAL TERMS.
(a) The Originator will initiate electronic credit and/or debit ACH Entries by means of, and as
a participant of, the ACH Network. The Bank agrees to act as the Originating Depository
Financial Institution ("ODFI") with respect to such ACH Entries as a participant in the
ACH Network. The governing body regulating the ACH Network is the NACHA. All
participants of the ACH Network, including the Originator, are required to follow the
guidelines set forth by the Rules.
(b) The Bank is a member of the ACH Network through the regional ACH Association,
Electronic Payments Core of Knowledge ("EPCOR"). EPCOR is a member of NACHA.
The Federal Reserve Bank acts as the ACH Operator for Bank, which facilitates the
exchange and settlement of electronic fund transfers in the ACH Network within the
United States.
(c) The Originator shall obtain, at the Originator's own expense, a copy of the Rules, as
amended (the "Rules"), and may procure any updates and revisions to the Rules from
NACHA, EPCOR or any other regional ACH association. The "Rules" are reviewed for
update on an annual basis. The Rules may be obtained online at www.nacha.org or
www.EPCOR.org.
C. TRANSMITTAL OF ACH ENTRIES BY ORIGINATOR. The Originator agrees to only initiate
credit and/or debit ACH Entries, for those "SEC codes" pre-approved by the Bank. The
Originator agrees to comply with the Rules, as defined herein and as amended by NACHA
from time-to-time, and that the ACH Entries and format of such ACH Entries will comply with
the Rules. The total amount of each ACH "Entry or Entries" and subsequent "Batch" and/or
"File" initiated by the Originator shall not exceed established limits set by the Bank. The
Originator shall initiate an ACH Entry or Entries and the corresponding Batch and/or File to
the Bank in accordance with the procedures and specifications set forth herein. The Bank, in
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its sole discretion and in addition to any File transmittal, may require the Originator to fax or
e-mail a ACH Transmittal Letter or provide the transmittal data by other electronic means as
specified by the Bank. If the Bank requests a change be made to an ACH Entry or Entries
within a Batch and/or File including, but not limited to, adding the Originator's phone number
to the "Company Discretionary Data" field within the Company/Batch Header Record, the
Originator agrees to make the change prior to the next initiation of the respective ACH Batch
and/or File. Any ACH Entry, Batch, and/or File that is released after the current Business
Day's Cut-Off Time as set forth in Section V.V., shall be processed on the next available
processing day, with a Settlement Date of one to two (1 to 2) Business Days from the
process date. Prior to the Cut-off Time, as set forth in Section V.V., the Originator must
confirm that each ACH Entry, Batch, and/or File submitted to the Bank has been processed.
The Originator shall deliver each ACH Entry, Batch, and/or File in accordance with the
processing schedule, if the ODFI requests a processing schedule, and as specified in Section
V.V.
D. INCONSISTENCY OF NAME AND ACCOUNT NUMBER. The Originator acknowledges and
agrees that, if an ACH Entry or Entries describes the "Receiver" inconsistently by name and
account number, payment of the ACH Entry or Entries initiated by the Originator may be
accepted by the RDFI (or by the Bank in the case of an On-Us Entry) solely based on the
account number when the account number is a valid account with the RDFI. This provision is
applicable even if the ACH Entry or Entries identifies a person different from the named
Receiver, and that the Originator's obligation to pay the amount of the ACH Entry or Entries
to the Bank is not excused in such circumstances.
E. PAYMENT BY ORIGINATOR FOR ACH ENTRIES. The Originator shall pay the Bank the
amount of each ACH Entry initiated by the Bank pursuant to this Section at such time and on
the "Settlement Date", or as otherwise provided in accordance with the ACH Block and
Transaction Filtering Authorization. The Bank shall determine, in its sole discretion, if, and to
what extent, ACH Block and Transaction Filtering Authorization, shall apply to each ACH
Entry.
F. ORIGINATOR REPRESENTATIONS AND AGREEMENTS; INDEMNITY; ACH DATA
BREACHES; AUDIT RIGHTS; DATA RETENTION.
1. With respect to each and every ACH Entry initiated by the Originator, the Originator
represents and warrants to the Bank and agrees that: (a) each person shown as the
Receiver of an ACH Entry, which may or may not be received by the Bank from the
Originator, has authorized the initiation of such ACH Entry in accordance with the Rules
and the crediting and/or debiting of his, her or its account in the amount and on the
"Effective Date" shown on each ACH Entry; (b) such authorization is operative at both the
time of transmittal and posting by the Bank as provided herein; and (c) the information
the Originator includes in each ACH Entry is accurate and complete. The Originator shall
also ensure all information included in each ACH Company/Batch Header Record is
accurate and complete; in particular, that the information within the "Company Name",
"Company Identification", and "Company Entry Description" fields pertain to the ACH
Entry or Entries being initiated by the Originator.
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2. The Originator shall perform its obligations under this Section in accordance with all
applicable United States federal and state laws and regulations and other applicable
laws, regulations, rules and procedures applicable to ACH transactions, including, but not
limited to, the Rules, the Uniform Commercial Code, Article 4A (UCC, Article 4A), and the
sanctions of OFAC (Office of Foreign Assets Control), and all ACH Entries initiated by the
Originator must comply with the foregoing laws, regulations, rules and procedures. No
ACH Entry initiated by the Originator may violate the laws of the United States. The
Originator acknowledges and agrees to consumer protections provided by the Electronic
Funds Transfer Act and its implementing Regulation E, including, but not limited to, error
resolution. Originator shall be bound by and comply with the provision of the Rules,
making a payment of an ACH Entry or Entries by the RDFI to the Receiver provisional
until receipt by the RDFI of final settlement for such ACH Entry or Entries. Originator
specifically acknowledges that it has received notice of the rule regarding provisional
payment and of the fact that, if such settlement is not received, the RDFI shall be entitled
to a refund from the Receiver for the amount credited and Originator shall not be deemed
to have paid the Receiver the amount of the ACH Entry or Entries.. The Originator
expressly authorizes the Bank to disclose the Originator's contact information, including
telephone number, to any RDFI for the purpose of giving the Originator's contact
information to the relevant Receiver.
3. The Originator shall indemnify the Bank against any loss, liability or expense (including
attorneys' fees and expenses) resulting from or arising out of any breach of any of the
foregoing representations or agreements. This indemnification is in addition to any other
indemnification rights that are provided for in this Section.
4. If requested by the Bank, the Originator shall provide the Bank with copies of any
requested documentation within two (2) Business Days from such request. The Originator
shall provide immediately available funds to offset any credit ACH Entries ("Offset
Funds") originated. The Originator shall maintain an "Offset Account" at the Bank for the
purpose of maintaining Offset Funds in an amount sufficient to cover the offset of any
credit ACH Entries, as required by this Section V.B.F.4. The Originator shall not originate
any ACH Entries for, or on behalf of, any other party. Any attempt to originate ACH
Entries for, or on behalf of, any other party shall render such ACH Entries null and void.
Notwithstanding any other provision in this Section, the Bank shall have the absolute right
to place a hold on funds in the Originator's Account, as defined herein, as well as any
other deposit account held by the Originator at the Bank, at any time, in any amount and
for the length of time the Bank deems necessary, in the Bank's sole discretion.
5. ACH Data Breaches. Originator shall adopt and implement, and shall ensure that each of
its Third-Party Service Providers adopts and implements, commercially reasonable
policies, procedures and systems to receive, store, transmit and destroy Consumer-Level
ACH Data (hereafter defined) in a secure manner, to protect against data breaches and
to detect the occurrence of data breaches. In the event of any data breach, Originator
and each of its Third-Party Service Providers shall provide prompt notice of the same to
ODFI's Information Security Officer. If a data breach is known or suspected, Originator
and/or its Third-Party Service Provider immediately shall commence and diligently pursue
an investigation of the circumstances to determine (i) if a data breach has actually
occurred, (ii) the scope of the data breach, including the type and amount of data
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affected, (iii) the risk that the affected data will be misused, and (iv) what steps are
necessary to prevent further unauthorized access to Consumer-Level ACH Data.
Originator and/or its Third-Party service Provider shall take all other actions required by
applicable law that such persons are required to take in the event of a breach of
Consumer-Level ACH Data. For purposes of this Section V.F.5., "Consumer-Level ACH
Data" shall have the meaning assigned to it by the Rules.
6. Audit Rights. The Bank reserves the right to audit, inspect, and review ACH Entries
originated by the Originator and Originator's files, records, systems and books with
respect to its origination of ACH Entries under this Section, and Originator's compliance
with this Section, the Rules and all other laws, rules and regulations applicable to
Originator's origination of ACH Entries. Originator will provide, within the timeframe
specified by the Bank, any and all documentation as the Bank may request, regarding
Originator's compliance with this Section, the Rules and all other laws, rules and
regulations applicable to Originator's origination of ACH Entries. The Bank also reserves
the right to require that Originator implement changes to its internal controls and
processes related to its origination of ACH Entries. Originator's failure to provide any
requested documentation, to comply with the Bank's audit request or to implement
reasonably requested changes to its internal controls and processes related to its
origination of ACH Entries within the Bank's specified timeframe may result in the closure
of the Originator's Account, as defined herein, as well as any other deposit account held
by the Originator at the Bank.
7. Data Retention. Customer shall retain data on file adequate to permit remaking of entries
for a period of two years following the date of their transmittal by Bank as provided
herein, and shall provide such Data to Bank upon its request. Without limiting the
generality of the foregoing provision, Customer specifically agrees to be bound by and
comply with all the applicable provisions of the Rules regarding the retention of
documents or any record, including, without limitation, Customer’s responsibilities to
retain all items, source document and records of authorization in accordance with the
Rules.
G. OFAC. The Originator agrees that it shall be responsible for compliance with OFAC
requirements as stated in Chapter IV, "OFAC Compliance" of the Rules (Operating
Guidelines). The Originator agrees that it will not violate OFAC-enforced sanctions, and that it
will not act on behalf of, or transmit funds to or from, any party subject to such sanctions. The
Originator agrees to originate only lawful ACH Entries and indemnifies the Bank from any
fines, expenses or losses due to actual or alleged violation of OFAC enforced sanctions.
Section V.A.15., provides the Specially Designated National (“SDN”) Website, which makes
available a current listing of persons and/or entities on the SDN list. ACH Customer is not
permitted to originate International Transaction Codes (“IAT”) to either Consumer or
Corporate accounts residing in Bank outside of the territorial jurisdiction of the United States.
H. AUTHORIZATIONS. The Originator shall obtain all authorizations and consents per the
Rules and shall retain these authorizations and consents for two years after the Settlement
Date of the last ACH Entry or Entries or as set forth by applicable state law, whichever is
longer. It is the responsibility of the originator to verify that the individual signing the ACH
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debit or credit Authorization is, in fact, entitled to use of the specified account. The
Originator's obligation to pay the amount of the ACH Entry or Entries of the Bank is not
excused if the party is not entitled to use the specified account. Upon request from the Bank
or RDFI, the Originator shall provide a copy of such authorization within five (5) Business
Days to the Bank.
I. PRENOTIFICATION ENTRIES. A Prenotification Entry is a non-monetary ACH Entry that,
when used, must be originated at least three (3) Business Days prior to initiating the first live
(monetary) ACH Entry to the Receiver's account. Prenotification Entries are optional under
the Rules; however, Bank strongly recommends use for payroll and other time sensitive ACH
Entries. In the event that a Prenotification Entry is returned to the Originator, the Originator
shall review the Return Reason Code and contact the Receiver for clarification prior to
initiating the first live monetary ACH Entry. An Originator that has originated a Prenotification
to a Receiver’s account may initiate subsequent live Entries to the Receiver’s account as
soon as the third Business Day following the Settlement Date of the Prenotification, provided
the ODFI has not received a Return Entry or Notification of Change (NOC) related to the
Prenotification. If the ODFI receives a Return Entry or NOC in response to the Prenotification
by the opening of the business on the second Business Day following the Settlement Date of
the Prenote, the Originator must not transmit subsequent Entries to the Receiver’s account
until it has remedied the reason for the Return Entry or made the correction requested by the
NOC. Originator shall use the format and medium provided in the Rules when initiating
Prenotification Entries as set forth in Section V.V. The Originator acknowledges that an ACH
Entry or Entries to a Receiver’s account where the Receiver’s name does not match the
account information with the RDFI and the account number is a valid account with the RDFI,
may be accepted by the RDFI based solely on the valid account number provided in the
originated Entry or Entries.
J. RETURN AND NOTIFICATION OF CHANGE. The Bank shall notify the Originator of any
ACH Return or NOC Entry or Entries received from the RDFI after receipt of such ACH Entry
or Entries. This notification will be delivered to the Originator electronically via the Bank's
Internet Banking System and at the Bank's discretion, as an exception only, may be given by
phone to an Authorized Representative of the Originator, as defined herein, or by fax or e-
mail. It is the responsibility of the Originator to review its Return and NOC information daily
and act upon it in a timely manner and in accordance with the Rules. Section V.A. provides
details of the NOC and Return process of the Rules. Chapter II, "Notification of Change," of
the Rules (Operating Guidelines), and Chapter III, "Returns, Dishonored Returns, Contested
Dishonored Returns," of the Rules (Operating Guidelines), respectively, provide complete
details of the NOC and Return process. Except for an ACH Entry or Entries retransmitted by
the Originator in accordance with the requirements of this Section V.J., the Bank shall have
no obligation to retransmit a Returned ACH Entry or Entries to the ACH Operator if the Bank
complied with the terms of this Section with respect to the original ACH Entry.
1. Upon receipt of any ACH Return Entry, the Originator shall act on such ACH Return Entry
as applicable, including, but not limited to, handling items returned as unauthorized
and/or revoked in accordance with the Rules. The Originator shall bear full responsibility
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for initiating items that are unauthorized and/or revoked. Originator shall be aware of,
and beholden to, the unauthorized return ratio threshold stated in the Rules.
2. Upon receipt of an ACH Return Entry for Insufficient Funds or Uncollected Funds
purposes, the Originator shall not re-initiate such ACH Entry or Entries more than two
times from the initial ACH Entry and in no case after 180 days of the Settlement Date of
the original Entry. The Originator shall bear full responsibility of re-initiating Insufficient
Funds or Uncollected Funds ACH Entries in accordance with the Rules.
3. Upon receipt of an NOC Entry, the Originator shall correct the account details of such
ACH Entry, if applicable, within six (6) Business Days from the Settlement Date of the
NOC Entry or prior to initiating the next ACH Entry to the Receiver's account, whichever
is longer.
4. The Originator acknowledges that it shall refer to the current Rules for a complete and
current list of Return Reason Codes, Dishonored Return Reason Codes, Contested
Dishonored Return Reason Codes, Notification of Change Codes, and Refused
Notification of Change Codes.
5. The Originator shall provide immediately available funds in the account(s) of the
Originator to offset any debit ACH Return Entries originated by the Originator.
K. REJECTED ACH BATCHES AND/OR FILES.
1. The Originator shall provide ACH Batches and/or Files in the medium set forth in Section
V.V. ACH Batches and/or Files not received in the specified format and medium may be
rejected by the Bank in its sole discretion. If an ACH Batch and/or File is rejected for any
reason, it is the responsibility of the Originator to remake and resubmit a valid ACH Batch
and/or File. Please refer to Section V.V.
2. If at any time prior to transmitting an ACH Batch and/or File to the ACH Operator, the
Bank determines, in its sole discretion, that the transmission of such ACH Batch and/or
File may expose the Bank to liability or risk of loss, the Bank shall have the absolute right
to reject such ACH Batch and/or File without penalty. The Bank would be exposed to
liability or risk of loss, for purposes of this Section V.K.2., in circumstances including, but
not limited to, the insolvency or bankruptcy of the Originator, or the garnishment or
placement of a judgment lien on any account held by the Originator at the Bank.
3. The Bank may reject any ACH Batch and/or File: that exceeds established limits set by
the Bank; that contains an ACH Entry Type that is not approved; where the Originator's
name and identification number contained in the Company/Batch Header Record does
not match the name and identification number of the Originator in the Bank's Treasury
Management System; that contains an invalid Effective Date; or for any other reason
Bank deems appropriate, in its sole discretion.
L. REVERSALS AND DELETIONS.
1. The Originator shall have no right to cancel or amend any ACH Entry after its receipt by
the Bank. The Originator shall reimburse the Bank for any expenses, losses, or damages
the Bank may incur in effecting or attempting to effect the Originator's request to reverse
an ACH Batch and/or File. An ACH Batch and/or File may be reversed for two (2)
reasons only: (a) a majority of the ACH Batch and/or File contains erroneous data, and/or
(b) it is a duplicate ACH Batch and/or File. If the Originator discovers that any ACH Batch
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and/or File it has initiated contains erroneous data (majority thereof) or is a duplicate
ACH Batch and/or File, it must notify the Bank within 24 hours of discovery. Should the
Bank be unable to stop the ACH Batch and/or File from processing, the Originator may
initiate a reversing ACH Batch and/or File, as provided for and abiding by the Rules and
Section V.V. An ACH Batch and/or File Reversal may be initiated by the Originator within
five (5) Business Days from the Settlement Date of the erroneous or duplicate ACH Batch
and/or File. The Originator shall supply the word "REVERSAL" in the "Company Entry
Description" field of the Company/Batch Header Record. Section V.A., provides details of
the ACH Batch and/or File Reversal process according to the Rules.
2. If the Originator discovers that an ACH Entry or Entries it has initiated contains erroneous
data or is a duplicate ACH Entry or Entries, the Originator may reverse the ACH Entry or
Entries. The reversing ACH Entry or Entries may be initiated within five (5) Business
Days from the Settlement Date of the erroneous or duplicate ACH Entry or Entries. The
Originator shall notify the Receiver(s) of the reversing ACH Entry or Entries no later than
the Settlement Date of the reversing ACH Entry or Entries.
3. When reversing a credit ACH Entry, Batch, and/or File it is possible that the funds may no
longer be available when the reversing ACH Entry, Batch, and/or File attempts to post to
the Receivers' account; therefore, the reversing ACH Entry, Batch, and/or File may be
returned to the Bank, on behalf of the Originator. In this case, the Originator's Account
will be charged for the amount of the ACH Entry, Batch, and/or File. Under such
circumstances, the Originator may need to pursue resolution of the reversing ACH Entry,
Batch, and/or File outside of the ACH Network.
M. REJECTED ENTRIES. The Bank reserves the right to reject any ACH Entry or Entries with or
without cause. In the event that the Bank rejects any ACH Entry or Entries for any reason, it
shall be the responsibility of the Originator to reinitiate the ACH Entry or Entries and the ACH
Batch and/or File that corresponds to such ACH Entry or Entries. Should the ACH Batch
and/or File be rejected due to an error caused by the Bank, the Bank shall be responsible to
reinitiate the ACH Batch and/or File. In either case, the Originator must supply sufficient
information to the Bank, upon request, to recreate the ACH Entry or Entries and the
corresponding ACH Batch and/or File. The Bank will use its best effort to process any
reinitiated ACH Entry or Entries and its corresponding ACH Batch and/or File in a timely
manner. The Bank shall have no liability to the Originator by reason of the rejection of any
such ACH Entry or Entries and/or its corresponding ACH Batch and/or File. The Originator is
required to retain copies of its ACH Entries, Batches, and/or Files submitted for processing
for a minimum of 90 days following the Settlement Date as provided herein, and shall provide
such data to the Bank upon its request within five (5) Business Days.
N. THE ACCOUNT. The Bank may, at its sole discretion and without prior notice or demand,
obtain payment of any amount due and payable to it under this Section by debiting the
Account, and shall credit the Account for any amount received by the Bank by reason of the
Return of an ACH Entry transmitted by the Bank for which the Bank has previously received
payment from the Originator. Such credit shall be made as of the day of such receipt by the
Bank. The Account shall be maintained by the Originator at the Bank. The Originator shall at
all times maintain a balance of available funds in the Account sufficient to cover its payment
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obligations under this Section. In the event there are not sufficient available funds in the
Account to cover the Originator's obligations under this Section, the Originator agrees that the
Bank may debit any other account maintained by the Originator with the Bank or any affiliate
of the Bank or the Bank may exercise its right of set-off without any notice to the Originator
against any amount it owes to the Originator, in order to obtain payment of the Originator's
obligations under this Section. The Originator shall provide immediately available funds in the
Offset Account maintained at the Bank to offset any credit ACH Entries originated or as
stated in ACH Block and Transaction Filtering Authorization. Similarly, the Originator shall
promptly provide immediately available funds in the Account to indemnify the Bank in the
event any ACH Entry or Entries is rejected after the Bank has permitted the Originator to
withdraw immediately available funds, should funds not be available in the Originator's
accounts to cover the amount of the rejected ACH Entry or Entries.
O. ACCOUNT RECONCILIATION. ACH Entries transmitted by the Bank or credited to a
Receiver's account maintained with the Bank will be reflected on the Originator's periodic
statement issued by the Bank with respect to the Account pursuant to this Section. The
Originator agrees to notify the Bank promptly of any discrepancy between the Originator's
records and the information shown on any periodic statement. If the Originator fails to notify
the Bank of any discrepancy within twenty-one (21) days of receipt of a periodic statement
containing such information, the Originator agrees that the Bank shall not be liable for any
other losses resulting from the Originator's failure to give such notice or any loss of interest or
any interest equivalent with respect to an ACH Entry shown on such periodic statement. If the
Originator fails to notify the Bank of any such discrepancy within 21 days of receipt of such
periodic statement, the Originator shall be precluded from asserting such discrepancy against
the Bank. This Section V.O. shall not be construed to limit in any way the Originator's duties
and obligations contained in this Section and under applicable law.
P. PROCESSING, TRANSMITTAL AND SETTLEMENT BY THE BANK.
1. The Bank shall: (i) process any ACH Entry, Batch, and/or File initiated by the Originator
or the Originator's Third-Party Service Provider that conforms with the procedures and
specifications set forth in the Rules and Section V.R. and Section V.V., (ii) transmit such
ACH Entry, Batch, and/or File as an ODFI to the ACH Operator or to an ACH Third Party
Service Provider, and (iii) handle such ACH Entry, Batch, and/or File as provided in the
Rules.
2. The Bank shall transmit any ACH Entry, Batch, and/or File to the ACH Operator on the
date released and/or uploaded by the Originator prior to the Effective Date of each ACH
Entry, Batch, and/or File provided: (i) such ACH Entries, Batches, and/or Files are
received by the Bank's related Cut-Off Time as set forth in Section V.V. on a Business
Day; (ii) The release and/or upload date of such ACH Entries, Batches, and/or Files is a
Business Day (iii) the ACH Operator is open for business on such Business Day; and (iv)
the Bank receives such ACH Entries, Batches, and/or Files in the appropriate time-frame,
as set forth in Section V.V.
3. If any of the requirements of clauses (i), (ii) or (iii) of Section V.P. are not met, the Bank
shall use reasonable efforts to transmit such ACH Entries, Batches, and/or Files to the
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ACH Operator by the next processing day that is also a day on which the ACH Operator
is open for business ("Business Day").
4. The Originator shall indemnify the Bank, its employees, officers and directors, if the Bank
incurs any financial loss or liability due to the breach, with respect to any ACH Entries,
Batches, and/or Files initiated by the Originator, of any of the warranties of an ODFI
contained in the Rules, except those due solely to the negligence of the Bank. This
includes reimbursement by the Originator to the Bank of any fines imposed on the Bank
due to breaches of the Rules by the Originator or any Third Party acting on behalf of the
Originator. This indemnification is in addition to any other indemnification rights that are
provided for in this Section.
5. The Originator will receive immediately available funds for any debit ACH Entries initiated
by it not later than the Settlement Date of such ACH Entries. Notwithstanding the
foregoing, the Bank may place a hold on any account held by the Originator at the Bank
in the Bank's sole discretion, and may impose other conditions on the Originator's
withdrawal of funds in the Bank’s sole discretion.
Q. PAYMENT FOR SERVICES. The Originator shall pay the Bank the charges for the services
provided in connection with the ACH ODFI services. All fees and services are subject to
change without prior notice to Originator. Such charges do not include, and the Originator
shall be responsible for payment of, any sales, use, excise, value added, utility or other
similar taxes relating to such services, and any other fees or charges provided for in this
Section.
R. SECURITY. The Originator and the Bank shall comply with the security procedure described
in Section V.R. The Originator acknowledges that the purpose of the security procedure is for
verification of data authenticity and not to detect errors within the transmitted ACH Entries,
Batches, and/or Files. No security procedure for detection of any such error has been agreed
upon between the Originator and the Bank. The Originator is strictly responsible to establish
and maintain the procedures to safeguard against unauthorized or inaccurate transmissions.
The Originator warrants that no individual will be allowed to initiate transfers in the absence of
proper supervision and safeguards, and agrees to take reasonable steps to maintain the
confidentiality of the security procedures and any passwords, codes, security devices and
related instructions provided by the Bank in connection with the security procedures
described in Section V.R. If the Originator believes or suspects that any such information or
instructions have been known or accessed by unauthorized persons, the Originator agrees to
notify the Bank immediately by telephone, followed by written confirmation to be mailed to
Bank within five (5) Business Days from date of verbal notification. The occurrence of
unauthorized access will not affect any transfers made in good faith by the Bank prior to
receipt of such notification and within a reasonable time period to prevent unauthorized
transfers. The Originator shall, upon request by the Bank, provide the Bank the Originator's
processing schedule, if the Originator has a processing schedule.
S. COMPLIANCE WITH SECURITY PROCEDURE. If an ACH Entry, Batch, and/or File (or a
request for cancellation or amendment of an ACH Entry, Batch, and/or File) received by the
Bank purports to have been transmitted or authorized by the Originator, it will be deemed
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effective as the Originator's ACH Entry, Batch, and/or File (or request) and the Originator
shall be obligated to pay the Bank the amount of such ACH Entry, Batch, and/or File even
though the ACH Entry, Batch, and/or File (or request) was not authorized by the Originator,
provided the Bank accepted the ACH Entry, Batch, and/or File in good faith and acted in
compliance with the security procedure established by the Bank and the Originator in Section
V.R. with respect to such ACH Entry, Batch, and/or File. If an ACH Entry, Batch, and/or File
(or request for cancellation or amendment of an ACH Entry, Batch, and/or File) received by
the Bank was transmitted or authorized by the Originator, the Originator shall pay the Bank
the amount of the ACH Entry, Batch, and/or File whether or not the Bank complied with the
security procedure referred to in Section V.R. with respect to that ACH Entry, Batch, and/or
File and whether or not that ACH Entry, Batch, and/or File was erroneous in any respect or
that error would have been detected if the Bank had complied with such procedure.
Transmittals with authorized signature(s) may be required as an additional method used to
verify authenticity of the communicated data.
T. COMMUNICATION SECURITY. In addition to the security procedures set forth in this
Section, the Originator must comply with the security procedures set forth in Section I.G. of
these Terms and Disclosures, as amended by the Bank. The Originator's failure to comply
with the security procedures shall result in Originator being responsible for any liability, loss
or damage resulting from the failure to comply with such security procedures. File Transmit
Method - through the Bank's Treasury Management Systems and designated Processors.
The Bank will not create and/or submit any payment information for the Originator. In the
event the Originator is unable to transmit any ACH Batch and/or File due to a complication
and/or malfunction of the Originator's equipment and/or software, including, but not limited to,
any complication and/or malfunction of a Third-Party Service Provider, the Originator must
have a contingency plan for transmitting its ACH Entries Batches, and/or Files. It is the
Originator's sole responsibility to decide which option (if any) it chooses to use and the Bank
shall be held harmless from any loss the Originator suffers as a result of such decision. If the
Originator does choose an alternate method to transmit its ACH Entries, Batches, and/or
Files, it shall notify the Bank prior to transmission. The items that follow may be of use to the
Originator when developing a contingency plan:
1. If the issue is with the Originator's Internet service, try going to different location to
access the Internet through a different Internet service.
2. If the issue is that the electrical power is out, try going to a different location that has
power.
3. If a payroll Batch and/or File is involved, consider issuing checks or sending wires.
4. Ensure that appropriate personnel of Originator are available to initiate, approve and
release Originator's ACH Entries, Batches and/or Files by the Bank's cut-off time.
U. ACH THIRD-PARTY SERVICE PROVIDER OR ACH THIRD-PARTY SENDER. With the
prior written approval of the Bank, when an ACH Third-Party Service Provider or ACH Third-
Party Sender acts on behalf of the Originator with respect to initiating any ACH Entry, Batch,
and/or File to the Bank or Bank's agent, the Originator acknowledges and agrees in this
Section that it has executed an ODFI/ACH Third-Party Sender Addendum, a written
agreement with its ACH Third-Party Service Provider or ACH Third-Party Sender binding both
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the Originator and ACH Third-Party Service Provider or ACH Third-Party Sender to comply
with the Rules. The Originator indemnifies the Bank of any fines imposed on the Bank due to
breaches of the Rules by the Originator or any ACH Third Party Service Provider acting on
behalf of the Originator. This indemnification is in addition to any other indemnification rights
that are provided for in this Section. Bank reserves the right at Bank’s sole discretion, to
periodically, among other things, conduct enhanced due diligence and impose additional
requirements on Customer and its customers.
V. LOGISTICAL INFORMATION.
1. Cut-off and Release Times. The Bank's Cut-off Time for receiving ACH Batches and/or
Files from the Originator is 5:30 p.m. Central Standard Time each Business Day. Any
ACH Entry, Batch, and/or File received after the current Business Day's Cut-off Time
shall be processed the next available processing day, with a Settlement Date of one to
two (1 to 2) Business Days from the process date.
(i) ACH Entries shall be released to the ACH Operator pursuant to the following
timeframes:
(a) Credit = not more than two (2) Business Days prior to Effective Date of the
ACH Entry.
(b) Debit = not more than one (1) Business Day prior to Effective Date of the
ACH Entry.
(ii) In order for the Bank to initiate any ACH Entry, Batch, and/or File on behalf of the
Originator to the ACH Operator in accordance with the timeframes set forth above,
the Bank must receive: (1) any debit ACH Entry no less than one (1) Business Day
prior to the Effective Date of the ACH Entry; and (2) any credit ACH Entry no less
than two (2) Business Days prior to the Effective Date of the ACH Entry.
(iii) Any ACH Entry, Batch, and/or File received by the Bank with an Effective Date that is
not a valid Business Day shall be processed on the next available processing day,
with a Settlement Date of one to two (1 to 2) Business Days from the process date.
2. Warehouse of Batches. The maximum number of days an ACH Batch may be submitted
to the Bank and warehoused prior to the Effective Date is 30 days. ACH Batches
received prior to release timeframes set forth above will be warehoused.
3. Returns and Notification of Change. The Bank will deliver to the Originator ACH Return
and Notification of Change (“NOC”) details that it receives from the ACH Operator on the
day of receipt via the Bank's Internet Banking System. Upon receipt of an NOC the
originator is required to investigate the incorrect data and make the correction to the ACH
Entry, when applicable, within six business days, or prior to initiating the next ACH entry
to the Receiver, which is later.
4. Closures. Information on Bank closures (Federal holidays, early closures, and the like)
may be found through the Bank's Internet Banking System (banner and/or message
area) or the Bank's Website banksnb.com.
5. Medium and Format. ACH Batches and/or Files received by the Bank must be in a
NACHA formatted file that is in compliance with the Rules, must be balanced unless
Bank has agreed otherwise prior to receipt of ACH Batch and/or File by Bank, and
comply with any other specifications stated by Bank.
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W. BANK RESPONSIBILITIES; LIABILITY; LIMITATIONS ON LIABILITY; INDEMNITY.
1. In the performance of the services required by this Section, the Bank shall be entitled to
rely solely on the information, representations, and warranties provided by the Originator
pursuant to this Section, and shall not be responsible for the accuracy or completeness
thereof. The Bank shall be responsible only for performing the services expressly
provided for in this Section, and shall be liable only for its gross negligence or willful
misconduct in performing those services. The Bank shall not be responsible for the
Originator's acts or omissions (including without limitation the amount, accuracy,
timeliness of transmittal or authorization of any ACH Entry received from the Originator)
or those of any other person, including without limitation any Federal Reserve Bank,
Third Party Service Provider, ACH or transmission or communications facility, any
Receiver or RDFI (including without limitation the Return of an ACH Entry by such
Receiver or RDFI), and no such person shall be deemed the Bank's agent.
2. ORIGINATOR INDEMNIFICATION OBLIGATIONS. ORIGINATOR WILL INDEMNIFY,
DEFEND AND HOLD HARMLESS THE BANK, ITS SHAREHOLDERS, AFFILIATES
AND SUBSIDIARIES, AND THEIR RESPECTIVE DIRECTORS, OFFICERS,
EMPLOYEES, SHAREHOLDERS, MEMBERS, LENDERS, PARTNERS, ATTORNEYS,
AGENTS, SUCCESSORS, ASSIGNS AND CORRESPONDENTS (COLLECTIVELY,
THE "BANK INDEMNIFIED PARTIES") HARMLESS FROM AND AGAINST ANY AND
ALL CLAIMS, DAMAGES, DEMANDS, JUDGMENTS, LIABILITIES, LOSSES AND
EXPENSES (INCLUDING ATTORNEY'S FEES) RESULTING DIRECTLY OR IN
DIRECTLY FROM: (1) ANY WILLFUL MISCONDUCT, NEGLIGENCE, ACTION OR
OMISSION ON THE PART OF ANY INDIVIDUAL WHO HAS BEEN LISTED, IN ANY
DOCUMENT OR AGREEMENT PROVIDED BY ORIGINATOR TO BANK, AS
PERSONS AUTHORIZED TO ACT ON ORIGINATOR'S BEHALF WITH RESPECT TO
ACH ENTRIES; (2) ACTS OR OMISSIONS BY THE BANK IN CARRYING OUT ITS
OBLIGATIONS HEREUNDER, EXCEPT FOR THE BANK'S GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT; (3) ORIGINATOR'S ACTS OR OMISSIONS (INCLUDING
WITHOUT LIMITATION THE AMOUNT, ACCURACY, TIMELINESS OF TRANSMITTAL
OR AUTHORIZATION OF ANY ACH ENTRY RECEIVED FROM THE ORIGINATOR);
(4) ORIGINATOR'S FAILURE TO OBSERVE ANY PROVISION OF THE AGREEMENT,
INCLUDING, WITHOUT LIMITATION, ITS BREACH OF ANY REPRESENTATION,
WARRANTY OR COVENANT HEREUNDER; (5) ANY CLAIM OF ANY PERSON THAT
THE BANK IS RESPONSIBLE FOR ANY ACT OR OMISSION OF THE ORIGINATOR,
ANY THIRD-PARTY SERVICE PROVIDER ACTING ON BEHALF OF THE
ORIGINATOR OR ANY OTHER PERSON DESCRIBED IN THIS SECTION V.W.; AND
(6) CLAIMS OF ANY PERSON, INCLUDING WITHOUT LIMITATION ANY FEDERAL
RESERVE BANK, THIRD-PARTY SERVICE PROVIDER, ACH OR TRANSMISSION
OR COMMUNICATIONS FACILITY, ANY RECEIVER OR RDFI (INCLUDING WITHOUT
LIMITATION THE RETURN OF AN ACH ENTRY BY SUCH RECEIVER OR RDFI),
RELATED TO OR ARISING OUT OF ACH ENTRIES OR OTHER TRANSACTIONS
MADE UNDER THIS SECTION. ORIGINATOR'S INDEMNIFICATION OBLIGATIONS
HEREUNDER SHALL INCLUDE THE PAYMENT OF ALL COSTS OF DEFENSE, IF
ANY, INCLUDING WITHOUT LIMITATION, ALL REASONABLE AND NECESSARY
ATTORNEY'S FEES, COURT COSTS, ACCOUNTING FEES, CLASS ACTION COSTS
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AND EXPERT FEES. NOTWITHSTANDING THE FOREGOING, ORIGINATOR'S
OBLIGATIONS TO DEFEND THE BANK HEREUNDER SHALL EXTEND WITHOUT
LIMITATION TO ALLEGATIONS OF OMISSIONS, NEGLIGENCE, GROSS
NEGLIGENCE, AND INTENTIONAL ACTS OF THE BANK OR THE OTHER BANK
INDEMNIFIED PARTIES, INCLUDING THE SOLE OR CONCURRENT NEGLIGENCE
OF ANY BANK INDEMNIFIED PARTY. IT IS CONTEMPLATED THAT ORIGINATOR'S
DEFENSE OBLIGATIONS UNDER THIS PROVISION MAY BE, BUT SHALL NOT
NECESSARILY BE, BROADER THAN ITS INDEMNIFICATION OBLIGATIONS
HEREUNDER.
3. The Bank shall be liable only for the Originator's actual damages; in no event shall the
Bank be liable for any consequential, special, incidental, punitive or indirect loss, damage
or lost profits which the Originator may incur or suffer in connection with this Section,
whether or not the likelihood of such damages was known or contemplated by the Bank
and regardless of the legal or equitable theory of liability which the Originator may assert,
including, without limitation, loss or damage from subsequent wrongful dishonor resulting
from the Bank's acts or omissions pursuant to this Section.
4. Without limiting the generality of the foregoing provisions, the Bank shall be excused from
failing to act or delay in acting if such failure or delay is caused by legal constraint,
interruption of transmission or communication facilities, equipment failure, war, terrorist
acts, emergency conditions or other circumstances beyond the Bank's control. In
addition, the Bank shall be excused from failing to transmit or delay in transmitting an
ACH Entry if such transmittal would result in the Bank's having exceeded any limitation
upon its intra-day net funds position established pursuant to present or future Federal
Reserve Board guidelines or in the Bank's reasonable judgment otherwise violating any
provision of any present or future risk control program of the Federal Reserve Board or
any rule or regulation of any other U.S. governmental regulatory authority.
5. Subject to the foregoing limitations, the Bank's liability for loss of interest resulting from its
error or delay shall be calculated by using a rate equal to the average Federal Funds rate
at the Federal Reserve Bank of New York for the period involved. At the Bank's option,
payment of such interest may be made by crediting the Account.
X. LIABILITY TO ORIGINATOR. In the event the Originator incurs any actual loss due to
mishandling of a particular ACH Entry or Entries by the Bank, the Bank's liability to the
Originator shall be limited to (a) liability for the Bank's gross negligence or willful misconduct;
(b) the amount recoverable by the Bank from the ACH Operator, or any Third Party pursuant
to the Rules; or (c) amounts recoverable under any indemnity agreement but, in no event
shall the Bank be liable for any consequential, special, incidental, punitive or indirect loss or
damage incurred or suffered by the Originator. Compensation shall be calculated using the
compensation rules provided in the Rules.
Y. COOPERATION IN LOSS RECOVERY EFFORTS. In the event of any damages for which
the Bank or the Originator may be liable to each other or to a Third Party pursuant to the
services provided under this Section, the Bank and the Originator will undertake reasonable
efforts to cooperate with each other, as permitted by applicable law, in performing loss
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recovery efforts and in connection with any actions that the relevant party may be obligated to
defend or elects to pursue against a Third Party.
Z. TERMINATION. These ACH ODFI Services are terminable upon 30 days written notice by
either party, provided that applicable portions of this Section shall remain in effect with
respect to any ACH Entries initiated by the Originator, and received by the Bank, prior to such
termination. In addition, any requirement for the Originator to obtain and/or retain any
document, including, but not limited to, any authorization as described in Section V.H., shall
survive the termination of this Section. In addition, the Bank shall have the absolute right to
immediately suspend indefinitely and/or terminate this Agreement, without notice to the
Originator, if the Bank determines, in its sole discretion, that any one or more of the following
events has occurred:
1. Any material adverse change in the business, properties, assets, operations or condition,
financial or otherwise, of the Originator, including, but not limited to, insolvency,
bankruptcy, federal or state tax deficiency or inability to maintain Originator's existing
credit rating;
2. Any violation by the Originator of any state or federal law;
3. Any violation by the Originator of the Rules;
4. The Originator originates an ACH Entry whereby a reserve account or an account with a
hold placed upon it is set up as a condition to process such ACH Entry, and the
Originator subsequently withdraws funds from the reserve account or the account with
the hold; or
5. The Originator breaches the terms of this Section.
The Bank shall have the absolute right to delete any ACH Entry, Batch, and/or File that the Bank receives, or has already received and has yet to transmit to an ACH Operator, after the termination of this Section pursuant to this Section V.Z. In the event the Bank does delete an ACH Entry, Batch, and/or File pursuant to the right granted to the Bank in this Section V.Z., it will inform the affected party by either telephone or e-mail of such deletion. Additionally, the Bank shall have the absolute right to immediately and unilaterally place Customer in the Bank’s Prefunded ACH Origination Services program in accordance with Section V.BB. of these Terms and Disclosures.
AA. ACH ORIGINATION SYSTEM. The Originator acknowledges that the ACH Origination
System it uses to initiate ACH Entries, Batches, and/or Files was developed by persons other
than the Bank and that the Bank is not responsible for the performance, design, operation,
completeness, security, correctness or accuracy of the ACH Origination System. THE ACH
ORIGINATION SYSTEM IS PROVIDED TO THE ORIGINATOR ON A NON-EXCLUSIVE
AND ON AN "AS IS" BASIS AND WITHOUT ANY EXPRESS OR IMPLIED
REPRESENTATION OR WARRANTY WHATSOEVER, ALL OF WHICH ARE HEREBY
EXPRESSLY DISCLAIMED BY THE BANK. The Originator represents and warrants to the
Bank that the Originator will, before using the ACH Origination System, perform a test of the
system (including, without limitation, all updates) to determine and confirm its functionality,
capability, usefulness and suitability for the Originator's applications. The Originator agrees to
bear all risk, expense and burden arising from the Originator's use of the ACH Origination
System.
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BB. PREFUNDED ACH SERVICES DISCLOSURE. The Bank may require a Customer to utilize
prefunded ACH Services as part of its ACH ODFI Origination Services, Customer agrees to
the following terms and conditions:
1. Prefunded ACH Credit Files. Prefunded ACH Credit File services are described as
processing an ACH credit file for payments contingent upon the availability of collected
funds in a designated DDA. The service has the following conditions and restrictions:
(i) Bank can debit Customer’s account the day of the Customer’s ACH files.
(ii) Holds on deposited checks will limit funds availability and checks written on the
designated DDA will impact account balances.
(iii) ACH credit files must be received by the stated cut-off time at a minimum of two
business days prior to the settlement date.
(iv) If Customer’s file is not processed due to insufficient funds in the designated account,
Customer may be required to re-initiate the file.
(v) IATs cannot be included in the transaction file.
2. Prefunded ACH Debit Files and Reserve Accounts. Prefunded ACH Debit File services
are described as processing an ACH debit file for receipt of funds from other parties’
bank accounts for which Customer is authorized to deduct payments. The service may be
contingent upon holding a portion of the funds received to cover potential returns over a
specified number of days in a reserve account. The service has the following conditions
and restrictions:
(a) At its discretion, Bank will determine the percentage of the funds received in the debit
file that will be held as well as the number of days over which the funds will be held to
cover potential returns.
(b) During the period of time the funds are held, they will not be available for Customer’s
use and will be released at the end of the predetermined timeframe.
(c) ACH debit files must be received by the stated cut-off time one business day prior to
the settlement date.
(d) IATs cannot be included in the transaction file.
Customer’s ACH credit files will not be processed until the above conditions are met. In
the event that the stated conditions are not met and the ACH credit file is not processed
or is delayed, Bank will not bear any liability for the fact that the file could not be
processed. Additionally, Bank will not bear any liability for the fact that funds were held
and unavailable for Customer’s use during the predetermined hold period. This applies to
both prefunded ACH credit files and ACH debit files. Failure to comply with the conditions
noted above may result in termination of ACH ODFI Origination Services or require
additional credit approval in order to continue using ACH services. Upon written
notification by Bank, Customer shall immediately establish a separate account funded
with an amount required to protect Bank against the risks associated with Customer’s
ACH operations (the “Reserve Account”). Such Reserve Account must be established by
the date requested by Bank, and the required Reserve Account amount expressly
includes any existing or anticipated Customer-related ACH returns, including all fees,
costs, fines and penalties assessed against either Customer or Bank associated with
such Customer-related ACH returns. The Reserve Account will not bear interest, and
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Customer will not have any right or interest in the Reserve Account funds; provided that
upon satisfaction of all of Customer’s obligations under this Section, Bank will pay any
funds remaining in the Reserve account no sooner than ninety (90) days after the
effective date of termination of Customer’s ACH Services pursuant to the Rules and
Regulation E. Effective upon the establishment of any Reserve Account, Customer
irrevocably grants Bank a security interest in the Reserve Account and any and all funds
in the Account, together with the proceeds thereof. Customer also agrees to execute and
deliver to Bank such instruments and documents that Bank may reasonably request to
perfect and confirm the security interest and Bank’s right of setoff in the Reserve
Account. Customer understands and acknowledges that Customer’s failure to establish
and fund a Reserve Account immediately upon Bank’s request shall be grounds for
immediate termination of Customer’s ACH Services provided by Bank, with such
termination in Bank’s sole discretion.
CC. ACH SERVICES APPROVAL AND UNDERWRITING PROCESS.
1. Bank Approval and Monitoring of Customer’s ACH Operations Risk. Customer agrees
and acknowledges Bank shall only provide ACH Services to Customer subject to Bank’s
prior approval. To obtain approval from Bank, Customer is required to undergo Bank’s
screening and risk analysis process regarding Customer’s proposed ACH operations. In
addition, after any initial approval for ACH Services by Bank, Bank shall also, from time-
to-time and in its sole discretion (including the occurrence of certain events described in
subsection (c) below), undertake additional ACH operations credit and risk analysis
monitoring activities that are deemed necessary, in Bank’s sole and absolute discretion,
while Bank is providing ACH Services to an approved Customer. Customer agrees to
cooperate with Bank regarding any ongoing risk analysis activities by Bank, including
providing financial or other documents in a timely manner upon Bank’s request, granting
Bank authority to obtain financial or other documents on Customer’s behalf, and taking
any risk mitigation or other ACH Entry origination procedures as required by Bank.
2. ACH Operations Credit and Risk Criteria. Bank’s ACH operations credit and risk analysis
shall be based on certain factors deemed relevant by Bank in its sole discretion,
including, but not limited to, the following factors: (i) the credit worthiness, financial
condition and financial performance of Customer, particularly Customer’s capital
adequacy relative to Customer’s ACH activity volume; (ii) the nature, conduct and
geographic location of Customer’s business, including whether Customer engages in
certain high-risk ACH activities or transaction environments, or whether certain “Standard
Entry Class” (“SEC”) codes that Bank either deems to be high-risk or does not allow are
present in Customer’s ACH transactions; (iii) the historic level and dollar amounts of
Customer’s ACH returns, including (A) any return levels or dollar amounts in excess of
generally acceptable ACH return parameters (as determined by Bank in its sole
discretion), (B) a sudden increase in Customer’s ACH return levels, or (C) any ACH
return levels in excess of NACHA return rate thresholds that are not reduced within the
allowed timeframe under NACHA Rules; and (iv) whether Customer adheres to all
authorization requirements set forth herein.
3. Material Change in Credit and Risk Analysis Criteria. In the event a Customer approved
for ACH Services either fails to satisfy the minimum risk analysis criteria as required by
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Bank, or if, in the opinion of Bank, Customer undergoes a material change in its
operations that Bank believes increases the risk of Customer’s ACH operations, then
Bank may, in its sole discretion, exercise its right to temporarily suspend Customer’s
ACH Services pending further investigation. Bank will inform Customer of the issue and,
after completing the investigation, may, in its sole discretion, take any and all of the
following actions: require Customer to pre-fund their ACH activities (as defined in Section
V.BB.); require Customer to establish a Reserve Account (as defined in Section V.BB.);
or terminate Customer’s ACH Services. Permanent termination of ACH services is may
be done immediately and without notice to Customer if Bank deems immediate
termination necessary to comply with the Rules. Events that constitute a material change
in a Customer’s business operations include, but are not limited to: (i) ACH return levels
that exceed what is determined by Bank to be generally acceptable; (ii) a significant or
sudden increase in Customer’s ACH return levels compared to Customer’s historic return
levels; (iii) significant changes in the nature of Customer’s business including types of
products and services or the transaction environment; or (iv) the occurrence of any other
event that Bank believes represents a material change in Customer’s financial
performance or financial condition.
VI. STANDING INSTRUCTIONS TRANSFER SERVICE TERMS
If Customer has requested and Bank has agreed to execute a future-dated single or recurring SI Funds Transfer (“Standing Instructions Funds Transfer” or “SI Funds Transfer”), either as a Wire Transfer or an ACH Entry, from Customer’s Account to an external account at another financial institution, Customer agrees to comply with the following:
A. AUTHORITY TO TRANSFER FUNDS. Customer understands that to authorize a SI Funds
Transfer, Customer must complete the Implementation Agreement. This authorization applies to
the Account identified in the Implementation Agreement. Customer authorizes Bank to execute
and charge to Customer’s Account any SI Funds Transfers designated in the Implementation
Agreement to transfer funds, provided the information in the Implementation Agreement is duly
completed and executed by an Authorized User in accordance with the procedures established
by Bank. Customer understands and acknowledges that Bank has no obligation to execute any
SI Funds Transfer that is not initiated in accordance with such procedures. Customer further
authorizes Bank to charge such Account for any applicable service fees for SI Funds Transfers
in accordance with Bank’s fee schedule in effect at the time of the SI Funds Transfer or in
accordance with any disclosures Customer receives at the time of the SI Funds Transfer.
B. SECURITY PROCEDURES. For all SI Funds Transfer requests, Bank may perform a call
back to an Authorized User to verify the request. Customer may also be required to provide
Bank with written and signed instructions from an Authorized User. Customer agrees that Bank
will not be liable for any delay in processing Customer’s SI Funds Transfer resulting from
compliance with these security procedures. Customer agrees that the use of these security
procedures to verify that Customer’s instructions in the Implementation Agreement have been
properly authorized is commercially reasonable for Customer. Customer further understands that
the security procedure is designed to verify the source of the request and not to detect errors in
the content of Customer’s instructions in the Implementation Agreement. Customer further
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agrees to notify Bank promptly of any changes to the information provided by Customer in the
Implementation Agreement, in accordance with Section I.A.A (Notice; Communications) of these
Terms and Disclosures.
C. INFORMATION SUPPLIED BY CUSTOMER. Customer agrees that Bank will rely on the
information Customer has provided in the Implementation Agreement to execute the SI Funds
Transfer. Customer understands that it is Customer’s responsibility to provide Bank with
accurate information regarding that transfer, including the account number of the beneficiary of
the SI Funds Transfer (such as “IBAN”) and the number (such as “BIC” or “SORT”) identifying
the beneficiary institution, since payment will be processed based on the number(s) provided by
Customer. Should Customer provide an incorrect account number and/or Beneficiary Bank
identifier, Customer understands that any losses resulting from the funds being credited to the
wrong account will be Customer’s responsibility.
D. EXECUTION OF A STANDING INSTRUCTIONS FUNDS TRANSFER REQUEST. If the
date of a SI Funds Transfer falls on a day that is not a Business Day, Customer understands that
Customer’s request will be executed on the next Business Day. Bank will make the
determination to pay or reject Customer’s SI Funds Transfer request on the day on which it is
executed based on Customer’s available balance at the time the SI Funds Transfer request is
processed.
E. REJECTION OF SI FUNDS TRANSFER REQUEST. Bank reserves the right to reject
Customer’s request for a SI Funds Transfer if Customer has insufficient available funds in
Customer’s account, if Customer’s Implementation Agreement is received by Bank by a
communication means not authorized by the bank, if Customer’s Implementation Agreement is
unclear or incomplete, if Bank is unable to verify Customer’s SI Funds Transfer request, or if for
any reason the request is unsatisfactory to Bank.
F. RESPONSIBILITY FOR SI FUNDS TRANSFERS. To the fullest extent permitted by law,
Customer agrees to assume full responsibility and be bound by all SI Funds Transfer requests
issued in Customer’s name, whether or not authorized, provided the SI Funds Transfer was
executed by Bank in good faith and in accordance with the procedures set forth in these Terms
and Disclosures.
G. DELAYS, NON-EXECUTION OF SI FUNDS TRANSFER REQUESTS. While Bank will
handle Customer’s SI Funds Transfer request as expeditiously as possible, Customer agrees that
Bank will not be responsible for any delay or failure to execute Customer’s SI Funds Transfer
request, or delay in making the funds available to the beneficiary due to circumstances beyond
the control of Bank or any intermediary or Beneficiary Bank handling the transfer, including,
without limitation, any inaccuracy, interruption, delay in transmission, or failure in the means of
transmission of Customer’s SI Funds Transfer request to the bank or execution of such request
by the bank, whether caused by strikes, power failures, equipment malfunctions, or delays
caused by one or more institution’s fraud screening procedures or compliance procedures for
anti-money laundering, economic sanctions or similar laws. Customer further agrees that Bank
may refuse to process or delay processing any request if it would violate any guideline, rule,
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policy, or regulation of any government authority or SI Funds Transfer system. TO THE EXTENT
PERMITTED BY LAW, BANK MAKES NO WARRANTIES, EXPRESS OR IMPLIED, WITH
RESPECT TO ANY MATTER IN CONNECTION WITH CUSTOMER’S FUNDS TRANSFER.
H. DESIGNATION OF BENEFICIARY BANK FOR SI FUNDS TRANSFERS. Customer must
specify a financial institution (hereafter referred to as “Beneficiary Bank”) in the Implementation
Agreement for the financial institution to receive a SI Funds Transfer. The Beneficiary (recipient)
Bank must be a member of the Federal Reserve System, Clearing House Interbank Payment
System (“CHIPS”), or a correspondent bank of such a member. Customer may request the
Beneficiary Bank to credit an account or to hold the funds for the beneficiary. In either case, the
Beneficiary Bank is responsible for following Customer’s instructions and notifying the beneficiary
when the funds become available. If Customer identifies a beneficiary by name and account
number, the Beneficiary Bank may pay the funds to the person identified by the account number
and Customer’s payment may be final even if the account number provided by Customer does not
correspond to the beneficiary. (The Beneficiary Bank is not obligated to verify that the account
number belongs to Customer’s beneficiary.) If the Beneficiary Bank is unable to locate an account,
the funds may be returned. Any losses resulting from any incorrect information Customer provides
regarding its beneficiary are Customer’s responsibility.
I. CURRENCY OF TRANSFER. SI Funds Transfers to beneficiaries within the United States
are made only in U.S. dollars
J. MEANS OF TRANSFER. Bank uses a variety of banking channels and facilities but will
ordinarily use electronic means to make a SI Funds Transfer. Customer agrees that Bank may
choose any conventional means that Bank deems suitable to transfer Customer’s funds to the
beneficiary. Because Bank does not maintain banking relations with every bank, it may be
necessary to use one or more intermediary banks before the funds are transferred to the
Beneficiary Bank. After Bank transmits the SI Funds Transfer to the intermediary bank, it will be
that bank’s responsibility to ensure that the SI Funds Transfer is completed. Customer understands
that there may be fees imposed by these other banks for handling Customer’s SI Funds Transfer
and that these fees may be deducted from the transfer amount before it is credited to the
beneficiary.
K. CANCELLATION OR AMENDMENT OF SI FUNDS TRANSFER REQUESTS. Customer
may cancel or amend Customer’s SI Funds Transfer request only if Bank receives Customer’s
request prior to Bank’s execution of the SI Funds Transfer request and at a time that provides
Bank with a reasonable opportunity to act upon that request. If Customer’s SI Funds Transfer
request has already been executed by Bank, Customer understands and agrees that the request
to cancel or amend the SI Funds Transfer will be effective with the voluntary consent of Bank
and the Beneficiary Bank. Bank will first have to check with the Beneficiary Bank to determine
whether or not the Beneficiary Bank will return Customer’s funds. If the Beneficiary Bank
confirms that the funds are returnable and the funds are returned to Bank, Bank will return the
funds to Customer. The amount that is returned to Customer may be less than Customer
originally transferred because of service charges of the Beneficiary Bank and/or Bank.
Customer’s returned funds will be in U.S. dollars. Bank shall not be liable to Customer for any
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loss resulting from the failure of the Beneficiary Bank to accept a cancellation or amendment of
Customer’s SI Funds Transfer request.
L. CLAIMS WITH RESPECT TO SI FUNDS TRANSFERS. Customer agrees that within thirty
(30) days after Customer receives notification in Customer’s periodic account statement that the SI
Funds Transfer request has been executed, Customer will notify Bank of any errors, delays, or if
Customer needs additional information related to that SI Funds Transfer. If Customer’s SI Funds
Transfer request was delayed or erroneously executed as a result of erroneous information provided
by Customer, Customer understands that it may be responsible for the amount of that transfer and
any associated fees. If Customer’s SI Funds Transfer request was erroneously executed or delayed
as a result of Bank’s error, Bank’s sole obligation to Customer is to pay or refund such amounts as
may be required under the Uniform Commercial Code Article 4A or by other applicable law. Any
claim for interest payable by Bank shall be at Bank’s published savings account rate in effect within
the state of the home branch for the account from which the SI Funds Transfer was made. IN NO
EVENT SHALL BANK BE RESPONSIBLE FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL, OR
PUNITIVE DAMAGES OR EXPENSES IN CONNECTION WITH CUSTOMER’S FUNDS
TRANSFER.
M. APPLICABLE LAW. In addition to the applicable law provisions contained in Section I.T
(Applicable Law) of these Terms and Disclosures, Funds transfers authorized under these Terms
and Disclosures may involve one or more SI Funds Transfer systems, such as Fedwire or the
Clearing House Interbank Payments Systems (“CHIPS”). In these cases, the rules of the
appropriate SI Funds Transfer system(s) will apply along with applicable law. Subpart B of
Regulation J and Article 4A of the Uniform Commercial Code apply to SI Funds Transfers made
through Fedwire. Funds transfers made through CHIPS are governed by and subject to CHIPS
Rules and Administrative Procedures and the laws of the State of New York, including Article 4A
of the Uniform Commercial Code.
VII. CHECK CAPTURE SERVICE TERMS
A. CHECK CAPTURE SERVICE. If Customer has requested and been approved to use the
Check Capture Service, referred to in these Terms and Disclosures as the (“Remote Deposit
Capture” or "RDC") Service. Customer will have the ability to scan images of checks, create
deposits, and electronically transfer those deposits for credit to one or more of Customer's
accounts maintained at Bank and designated in writing by Customer (the "RDC Account").
Images of checks scanned by Customer will be transmitted through a secure, browser based
user interface. Customer understands and agrees that the RDC Service may be provided
directly to Customer by Bank or by Bank's designated third party vendor. The features,
functions and specifications of the RDC Service are within Bank's sole and absolute
discretion. Customer’s ability to utilize the RDC Service shall be subject to the transaction
limits contained in the Implementation Agreement.
B. THE RDC ACCOUNT. Customer must designate and maintain at least one DDA as the RDC
Account to utilize the RDC Service. Customer may designate more than one DDA as an RDC
Account for the RDC Service; provided, however, that Customer must contact Bank to add or
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delete RDC Accounts. Customer understands and agrees that deposits made via the RDC
Service may only be made to a designated RDC Account.
C. SCANNERS AND OTHER EQUIPMENT AND SOFTWARE. Customer agrees to use only
equipment and software compatible with Bank systems and equipment and which have been
approved by Bank. Bank shall have no liability or responsibility for any damages, losses,
claims or causes of action experienced by Customer because of any software or equipment
used with the RDC and related services and transactions contemplated by this Agreement,
and Customer’s sole recourse regarding any such damages, losses, claims or causes of
action shall be against the manufacturer of such software and equipment. Customer
acknowledges and agrees that Bank shall not be liable for the maintenance, repair,
performance, or malfunction of third party software, scanners, or other equipment used by
Customer in connection with the RDC Service.
D. SECURITY. Customer acknowledges that the RDC Service is subject to the terms and
conditions set forth in these Terms and Disclosures, including, without limitation, the Security
Procedures set forth in Section I.G of these Terms and disclosures, and Customer agrees to
comply with such Security Procedures. Bank may recommend certain types of other security
procedures. It is Customer's responsibility to promptly and completely implement any such
security procedures. The Customer's failure to comply with the Security Procedures shall
result in Customer being responsible for any liability, loss or damage resulting from the failure
to comply with such security procedures.
E. PROCESSING PROCEDURES. Customer agrees to comply with all processing and
operating procedures set forth in any User Guide. Without limiting the foregoing, Customer
agrees to adhere to the following minimum procedures:
1. Checks deposited into an RDC Account must be payable to Customer, a reasonable
variation thereof, (or to a 'Specified Third Party' named in an authorizing agreement
adopted by the Customer and acceptable to Bank).
2. Customer must properly scan and transmit all information from the front and back of the
original check and ensure that all images submitted are of acceptable quality. The RDC
Service may reject any items received from Customer that cannot be processed by Bank
or its designated processor due to image or MICR quality concerns. Examples of images
which are not acceptable for deposit (non-conforming items) can be found at
https://www.banksnb.com. Customer may be assessed a fee for submitting any duplicate
or non-confirming items. Customer agrees to be available to rescan or otherwise present
original checks for those items that cannot be processed due to image, MICR or other
quality concerns.
3. Customer may create, approve and submit deposits up to the established cut-off time.
Customer understands and agrees that any deposit not submitted by Customer prior to
the established cut-off time will be considered received by Bank on the next "Business
Day" following Customer approval. For purposes of this Agreement, "Business Day"
means Mondays through Fridays, except Bank holidays.
4. Only United States dollar-denominated checks drawn on United States banks may be
deposited via the RDC Services. Bank assumes no responsibility for any check drawn on
a non-United States bank or checks payable in any currency other than United States
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dollars (non-conforming items) that are deposited via the RDC Service, and customer
shall indemnify Bank for any losses suffered by Bank as a result of processing any
nonconforming item.
F. DEADLINES AND DISRUPTIONS. Bank will process deposits that are received by Bank
prior to the cut-off time established by Bank for accepting items deposited through the RDC
Service and provide ledger credit to Customer's RDC Account for the amount of such
deposits. Deposits received on a day that is not a Business Day or after the cut-off time for
RDC deposits will be considered received on the next Business Day. Availability of funds
deposited through the RDC Service will be determined by Bank's current funds availability
schedule. Bank reserves the absolute right to change the cut-off time for RDC deposits with
prior notice to Customer. Internet services are not guaranteed up-time services and can be
subject to service disruption of unspecified duration and severity. Such disruptions are
beyond the control of Bank. Bank assumes no responsibility for any losses suffered by
Customer for the disruption of internet services, equipment or electronic failures, or any other
condition beyond the control of Bank.
G. RECORD RETENTION. Customer agrees to maintain original checks for a period of 60
calendar days and allow Bank to review and inspect them during reasonable business hours.
Checks are to be stored in a secure site under lock and key. After the recommended
retention period, checks must be shredded and disposed of properly. Customer shall destroy
and dispose of the checks with a high degree of care, including selection and implementing
appropriate destruction and disposal procedures. Customer is required to implement such
procedure sot ensure that the checks are not accessed by unauthorized person during the
destruction and disposal process and, once destroyed, the checks are no longer readable or
capable of being reconstructed (e.g., through the use of competent shredding equipment).
H. AUDITING AND INTERNAL CONTROLS; FURTHER ASSURANCES. Bank reserves the
right to audit, inspect, and review Customer's files, records, systems and books with respect
to its use of the RDC service and its compliance with these Terms and Disclosures and
Implementation Agreement and all laws, rules and regulations applicable to Customer's use
of the RDC Service. Customer will provide, within the timeframe specified by the Bank, any
and all documentation as Bank may request, regarding Customer's compliance with these
Terms and Disclosures and Implementation Agreement and all laws, rules and regulations
applicable to Customer's use of the RDC Service. If requested by Bank, Customer will allow
Bank to perform an on-site audit of Customer’s RDC process at any location from which
Customer submits RDC deposits. Bank also reserves the right to require that Customer
implement changes to its internal controls and processes related to its use of the RDC
Service. Customer's failure to provide any requested documentation, to comply with Bank's
audit request or to implement reasonably requested changes to its internal controls and
processes related to its use of the RDC Service within the Bank's specified timeframe may
result in closure of the RDC Account and Customer's other accounts with the Bank.
I. CUSTOMER WARRANTIES AND INDEMNIFICATIONS. Customer is responsible for all the
warranties and indemnifications of a Reconverting Bank as defined in The Check Clearing for
the 21st Century Act ("Check 21 Law") and its implementing regulations found at 12 C.F.R.
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Part 229, as the same may be amended. Customer warrants that the images it transmits to
Bank or its third party vendor are faithful recreations of the original paper item. Customer also
represents and warrants that duplicate images of the same item will not be presented for
payment to Bank or any other financial institution or entity, and that the original item, an
image of which has been transmitted to Bank or its third party vendor through the RDC
Service, will not be presented for payment to Bank or any other financial institution or entity.
Customer also represents and warrants that (a) checks processed using the RDC Service are
properly payable to Customer and are not third party checks (unless named as a 'Specified
Third Party' in an authorizing agreement adopted by Customer and acceptable to Bank); (b)
deposit totals accurately match the total of all items deposited; (c) if the customer alters
information, including check amounts and deposit totals, all such alterations are accurate and
are properly made; and (d) following any retention period required by applicable law and/or
this Agreement, original items will be destroyed in a manner that will render the items
unreadable and incapable of subsequent recreation or processing. In the absence of gross
negligence or willful misconduct on the part of Bank, Customer agrees to indemnify and hold
Bank and its third-party service providers harmless for (and agrees to immediately reimburse
Bank and/or any affected service provider for) all damages of any nature, including the cost
of reasonable legal fees incurred by Bank and such service provider, sought by any person or
entity against Bank or such service provider under applicable law or asserted under any legal
theory or as a result of breaches asserted against Bank or such service provider in
connection with Bank's and/or such service provider's provision of the RDC Service, including
damages from the presentment or negotiation of the original item by any person or resulting
from the submission of duplicate images by any person or resulting from claims that the
image or substitute item created from an image is not an accurate and unaltered recreation of
the item originally drawn by the drawee. Except as modified herein or otherwise modified by
a writing executed by Bank, all terms and provisions of the Master Treasury Management
Services Implementation Agreement and Master Treasury Management Services Terms and
Disclosures remain in full force and effect.
VIII. POSITIVE PAY SERVICE TERMS
A. THE SERVICE. The Bank agrees to provide various "Positive Pay Services" to the Customer
for the purposes of increasing the chance of identifying fraudulent or unauthorized checks
and/or electronic transfers drawn on selected Customer Deposit Account(s), as identified to
the Bank.
1. Check Module. Customer uploads a file of issued checks within the Positive Pay
application. Checks posted to the Customer’s applicable Deposit Account(s) are
compared to the Issued Check File and exceptions are presented to the Customer to
decide if the item should be returned.
2. ACH Module. Customer may define limited parameters to block or filter ACH
transactions presented to the bank for payment.
3. Reverse Positive Pay Module. Customer may download a file of paid items, which may
then be imported into the Customer’s accounting system.
4. Reconciliation Module. Reporting tools are provided which assist the Customer in
balancing the Deposit Account(s) subscribed to the Service.
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B. PROCEDURES.
1. Issued Check File Customer Submission. Files delivered to the Bank shall be prepared
and submitted in compliance with the formatting as provided. Transmissions received by
the Bank after 4:00 P.M. Central Time may not be posted to the Issued Check File
(defined herein) until the next business day.
2. Check Module. For applicable Deposit Accounts identified whereby the Customer has
requested the Bank verify checks against an Issued Check File, the Customer agrees to
deliver or transmit the serial number, amount, date issued and status of each check by
Deposit Account number (such data cumulatively, the "Issued Check File") to the Bank in
the format agreed to by the Bank and the Customer. With the exception of checks
presented for immediate payment in person ("Teller Checks"), Issued Check File data
received by 4:00 PM Central Time each Business Day will be used to verify any check or
Electronic Check Presentment ("ECP") items posting to the applicable Deposit Account
that Business Day. Checks presented to Tellers will be cashed only if verified against
the most recent Issued Check File made available to Bank tellers and, if cashed, will be
posted to the applicable Deposit Account on the Business Day they are received. If the
online Issued Check File is unavailable, Bank’s tellers will follow normal check cashing
procedures. Bank reserves the right to cash any check presented to a Teller if the
amount of the check is below a Bank defined threshold, even if the check is not listed in
the Issued Check File. For items presented through ECP, the serial number on the
Customer’s Issued Check File must match the serial number on the MICR line of the
Customer’s checks as shown on the ECP item. The Customer acknowledges that Bank
has no controlled over what items are presented through ECP and what information is
provided with those items. The Customer also acknowledges that any stop payment
issued on a check will supersede any data transmitted hereunder.
3. ACH Module. As requested by the Customer, limited ACH blocks or filters can be created
which will stop external debits or credits (items not originated by or at the Bank) from
being allowed to process against a selected Customer Deposit Account. Possible
parameters which can be used to create blocks or filters include ACH Standard Entry
Class (SEC) code, transaction type (debit, credit, or both) and transaction amount. All
transactions originated by or at the Bank (including direct deposit settlement transactions)
are considered internal items and will not be matched against the Customer's maximum
and are processed, regardless of the amount.
4. Reverse Positive Pay Module. For applicable Deposit Accounts identified whereby the
Customer has requested the Reverse Positive Pay Module, Bank will make available to
Customer a report the Customer may download which will provide a listing of paid check
items. The format and data contained in the report will be determined by Bank in its sole
discretion.
5. Reconciliation Module. Three types of reports are available to assist with reconciling a
selected Customer Deposit Account.
a. Check Reconciliation - used to assist in balancing online account balances
with an account statement for check transactions only. The report displays
an activity summary of newly issued checks, paid checks, and
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stopped/voided checks. The report also provides a total of outstanding
checks as of the reconciliation date.
b. Deposit Reconciliation – used to verify deposits made to an account by
location. Requires the use of location specific transaction codes on deposit
slips.
c. Account Reconciliation – used to assist in balancing online account balances
with an account statement for all transactions. The report displays an activity
summary with newly issued checks, paid checks, stopped checks, voided
checks, ACH debits and credits, miscellaneous debits and credits, deposits,
service charges, paid interest and taxes/withholding. The report also
provides a total of outstanding checks and the check register balance as of
the reconciliation date.
6. Exception Reporting. Each Business Day, for each Deposit Account for which the
Customer has requested the Service, the Bank will make available to the Customer, via
the Treasury Management System, an exception report (the "Exception Report") for the
prior Business Day for each Deposit Account for which the Customer has requested the
Service. The Exception Report will list (i) all check, Substitute Check (defined herein) and
ECP items posted to the applicable Deposit Account but not on the Issued Check File; (ii)
all check, Substitute Check and ECP items posted to the applicable Deposit Account that
are on the Issued Check File but for an amount different than that stated on the Issued
Check File; (iii) in the case of ACH where the Customer chooses to set Maximum Limits,
Substitute Check, ACH and/or ECP items exceeding the Maximum Limit; and (iv) all ACH
debits where the Customer chooses to block ACH debits.
7. Return Authorization for Exception Report Items. In the event the Customer wants to
return any item on the Exception Report, the Customer must notify the Bank of its intent
to return such item on or before the deadline stated in the Positive Pay system on the
Business Day that the Customer received such Exception Report. Such notification must
be made by an authorized Transactional User to the Bank via the Bank's Internet
Banking Services. Any items on the Exception Report not authorized for return by the
Customer will remain settled to the account.
C. SECURITY PROCEDURES. The Customer and the Bank shall comply with the following
Security Procedures with regard to the delivery/transmittal of Positive Pay files by the
Customer to the Bank.
D. TRANSMITTAL PROCEDURES. Through the Treasury Management System there is an
upload section where the Issued Check File may be uploaded. Customer may also choose to
enter the information directly into the Treasury Management System with the following data
required: (i) Check number (ii) Check Amount (iii) Account number (iv) Issue Date.
E. UPDATING ISSUED CHECK FILE(S). For each Deposit Account for which the Customer
requests certain Services hereunder, the Bank will pay Items presented for payment against
such Deposit Account in accordance with the terms of the Agreement. It is the responsibility
of the Customer to routinely and regularly update the "Issued Check File." The Bank is not
liable to the Customer or any third party for the payment or rejection of items consistent with
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the terms of the Agreement, or for the erroneous payment or rejection of an item due to an
encoding error or posting error. Should the Customer fail to routinely update Issued Check
File(s), the Bank may terminate this Service immediately upon written notice to the Customer.
F. DOCUMENTATION REQUIREMENTS. Customer agrees to assist Bank in completing any
and all documentation requested by Bank in regards to an item Customer has elected to
return.
IX. DIGITAL LOCKBOX SERVICE TERMS
Bank and Customer agree that the provision by Bank and the use by Customer of the Bank’s Digital Lockbox™ Service described below shall be subject to the terms and conditions set forth in this Section. The options the Customer has elected to use as stated in the Implementation Agreement will determine which terms and conditions apply.
A. DEFINITIONS. The following words or phrases in this Section shall have the following
meanings:
1. Acceptable Payees. Individuals or entities named as payees on Checks whom Customer
has designated in writing as acceptable payees for the purpose of accepting deposits via
the Lockbox Services.
2. Acceptable Addressees. Individuals or entities named as addressees on correspondence
whom Customer has designated in writing as acceptable addressees for the purpose of
processing Paper Documents via the Lockbox Services. Acceptable Addressees are
designated in Implementation Agreement.
3. Check. A draft, payable on demand, and drawn on or payable through or at an office of a
bank.
4. Data. Checks and Paper Documents as defined herein and the scanned images and index
data created from them.
5. Debit Account. The account of Customer maintained at Bank which Bank may debit for
fees and costs incurred pursuant to this Agreement. The Debit Account is identified in the
Implementation Agreement. The Debit Account may be the same account as the Deposit
Account.
6. Deposit Account. The account of Customer maintained at Bank into which all Checks
processed via Lockbox Services under this Agreement will be deposited. The Deposit
Account is identified in the Implementation Agreement.
7. Image Files. The files transmitted or made available to Customer containing image of the
Checks and Paper Documents processed via the Lockbox Services. The format and type
of Image File is defined in the Implementation Agreement.
8. Image Management Software. The software system used by Bank to provide Data storage
and retrieval access to Customer, including any updated or upgraded versions thereof.
9. Lockbox Services. Includes (i) the process of collecting mail addressed to Customer; (ii)
the opening and processing of such mail, which may include the scanning of Checks and
Paper Documents for the purpose of providing Customer electronic access to the Data via
the Image Management Software or by delivery of Image Files if applicable; and (iii) the
depositing of Checks made payable to Customer’s Acceptable Payees into the Deposit
Account.
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10. Paper Documents. All documents in paper form received by Bank on Customer’s behalf
pursuant to this Agreement, including, without limitation, invoices, statements, explanation
of benefits (“EOBs”) and any other accompanying correspondence. The term Paper
Documents does not include Checks.
B. IMAGE MANAGEMENT SOFTWARE SYSTEM ADMINISTRATION. Bank will issue
Customer’s designated Treasury Management System Administrator(s) with a Log-in ID to
facilitate the Treasury Management System Administrator’s access to the Image
Management Software. The Treasury Management System Administrator shall create and
administer Authorized User accounts. The Treasury Management System Administrator and
Customer’s Authorized Users authorized and managed by the Treasury Management System
Administrator may access the scanned images of Customer Data using the Image
Management Software provided by Bank.
C. TRAINING. Bank shall provide one (1) initial training session for the Treasury Management
System Administrator and Authorized Users designated by Customer for the initial training
session for the purpose of enabling the designated Treasury Management System
Administrator and initial Authorized Users to understand and properly operate the Image
Management Software. At the request of Customer, additional training sessions may be
scheduled. Customer agrees to pay Bank the fee(s) set forth in the Implementation Agreement
for such additional training. Customer agrees to reimburse Bank for all reasonable out-of-pocket
expenses, including, but not limited to, supplies, lodging, transportation and meals incurred by
Bank employees in the course of any travel necessary for their performance of the above
training.
D. P.O. BOX DESIGNATED FOR CUSTOMER. In connection with Customer’s use of the
Lockbox Services, Bank will supply a P.O. Box for receipt of payments to Customer. The P.O.
Box is identified in the Implementation Agreement. Customer understands and agrees that all
rights to the P.O. Box utilized for receipt of Customer’s mail by Bank under this Agreement
belong to Bank, and that Customer has no rights to access the P.O. Box, forward mail from the
P.O. Box or to otherwise modify or terminate the P.O. Box account. In addition to the P.O. Box
described above, Customer may also elect to receive payments at its own mailing address and
transport those payments to Bank for processing under this Agreement.
E. ACCEPTABLE PAYEES AND ACCEPTABLE ADDRESSEES. Customer agrees to provide
Bank with an accurate and complete list of Acceptable Payees and Acceptable Addressees on
or before the effective date of this Agreement and to notify Bank immediately of any changes in
its list of Acceptable Payees or Acceptable Addressees. Customer acknowledges that Bank
may continue to process payments to Acceptable Payees, and/or to process Paper Documents
for Acceptable Addressees, for up to three (3) Business Days following Bank’s receipt of
Customer’s instruction to remove an Acceptable Payee/Addressee from its list of Acceptable
Payees/Addressees. Customer acknowledges and agrees that Bank shall be obligated to
deposit only Checks made payable to Customer’s Acceptable Payees. Bank agrees to make a
reasonable effort to contact the Treasury Management System Administrator in the event of
the receipt of a payment made payable to a payee not listed as an Acceptable Payee. If
Customer does not notify Bank in writing that it authorizes Bank to deposit a payment to such
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payee within ten (10) days after the date Bank contacts Customer, Bank will return the
Check(s) and any accompanying Paper Documents to the sender. Bank shall not be liable for
any delay in the processing of Checks or Paper Documents received by Bank if they are not
made payable to Customer’s Acceptable Payees or are not addressed to Customer’s
Acceptable Addressees.
F. PROCESSING OF CHECKS. Bank will open the envelopes obtained from the P.O. Box
assigned to Customer by Bank for receipt of Customer’s payments or received directly by Bank
from Customer, remove the contents, and inspect and handle the Checks and Paper
Documents in the following manner in accordance with the options the Customer has selected:
Checks and the accompanying Paper Documents will be scanned and indexed and transmitted
to the Image Management Software; or the Image Files will be transmitted or made available to
the Customer in the manner designated in the Implementation Agreement. Checks made
payable to Acceptable Payees or a reasonable deviation thereof shall be acceptable for
deposit. If the legal and courtesy amounts of the Check differ, Bank will guarantee the legal
amount in the absence of the ability to determine, from the accompanying Paper Documents
which amount is correct. Checks bearing the handwritten or preprinted legend “Paid in Full”
stamped anywhere on the Check will be accepted for deposit. Checks or drafts which are found
to be unacceptable for deposit because of document integrity will not be deposited in the
Customer’s Deposit Account and will be forwarded to Customer in the manner and to the
address designated in the Implementation Agreement. Deposited Checks will be endorsed with
the routing number of the depositing institution and the date of deposit. Bank shall not be liable
for damages incurred as a result of depositing any Checks which are made payable to an
Acceptable Payee.
G. DISPOSITION OF PAPER DOCUMENTS. After the Checks and Paper Documents have
been processed, Bank shall dispose of the Paper Documents in accordance with the method
selected by Customer as set forth in the Implementation Agreement. If Customer has elected
to have Paper Documents shredded after processing, but Customer subsequently determines
that it would like to have a particular Paper Document, Customer must contact Bank to
request the document no later than ten (10) days after Bank’s receipt of the Paper Document.
Any requests for Paper Documents must be sent to the following email address:
CustomerSolutionCenter@banksnb.com. Any Paper Documents that Bank is unable to
process shall be sent to the Customer in the method as designated in the Implementation
Agreement. If Customer elects to utilize Bank’s courier services, lock bags will be issued to
and used by Customer. Customer agrees to pay the then current fees for the lock bags.
Unless requested otherwise, Customer will be issued four (4) bags. To ensure availability of
bags, Customer agrees to return empty bags to Bank on a daily basis or as courier service
allows.
H. CUSTOMER’S USE. Customer’s access to and use of the Image Management Software
shall be for Customer’s internal business use only, shall be used in a manner consistent with
the documentation, terms and conditions provided with it, and may not be used by Customer
for the benefit of any third party. Customer shall be solely responsible, at its own expense, for
providing its own connection to the internet, and for acquiring, installing and maintaining all
connectivity equipment, hardware, software and other equipment as may be necessary for
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Customer and its Authorized Users to connect to, access, and use the Image Management
Software. Customer represents and warrants that it will comply with all applicable federal,
state and local laws and regulations, and communications common carrier tariffs, and will use
the Lockbox Services solely for lawful purposes. In addition, Customer shall at all times
ensure that all Customer Data that Customer has Bank store with the Image Management
Software is of a lawful nature, and that Customer has the legal right to have such Data
accessed and stored by Bank. Bank reserves the right to take all actions, including
termination of this Agreement, which it believes necessary to comply with applicable laws,
regulations and tariffs.
I. STORAGE OF IMAGES AND DATA ON THE SYSTEM. If Customer has elected to use the
Image Management Software Customer’s Data shall be electronically stored until (i) the
expiration or termination of this Agreement, or (ii) a period of seven (7) years, whichever
occurs first. Upon the termination of this Agreement or the closure of Customer’s Lockbox
Deposit Account, Customer may, at its option, request the delivery of Customer’s Data.
Customer must make such request within thirty (30) days after the termination of this
Agreement or the closure of its Lockbox Deposit Account. Customer’s failure to make such
request within the time required will be deemed a waiver of its right to do so, and Bank may
thereafter destroy such Data without further notice. If Customer timely requests delivery of its
Data, Bank will deliver the Data to Customer on USB storage devices or such other media
then offered by Bank, at Customer’s choice. Bank’s obligation to deliver the Data will be
subject to Bank’s receipt of Bank’s then current fee for the USB storage devices or other
media then offered by Bank.
J. PROCESSING SCHEDULE. Checks which are deemed acceptable for deposit per the
Acceptable Payee list will be deposited into the Deposit Account on the Business Day on
which they are received. Images of Checks which are deemed acceptable for deposit and
the accompanying Paper Documents will accessible to Customer via the Image Management
Software on the next Business Day following Bank’s receipt of same.
K. DISASTER RECOVERY PLAN. Bank has a disaster recovery plan ("Disaster Recovery
Plan"), and Bank requires its subcontractors to provide and maintain a disaster recovery plan
to the extent that Bank subcontracts database storage or Image Management Software
hosting to an independent data center. A "Disaster" shall mean any unplanned interruption of
the operations of or inaccessibility to Bank’s data center or a subcontractor’s data center, in
which Bank, using reasonable judgment, requires relocation of processing to a recovery
location. During a Disaster, the Lockbox Services shall be provided by Bank only to the
extent that adequate capacity exists at the recovery location. Customer understands and
agrees that the Disaster Recovery Plan is designed to minimize, but not eliminate, risks
associated with a Disaster affecting Bank’s ability to provide the Lockbox Services. Bank
does not warrant that the Lockbox Services will be uninterrupted or error free in the event of a
Disaster. Customer maintains responsibility for adopting a disaster recovery plan relating to
disasters affecting Customer’s facilities and for securing business interruption insurance or
other insurance necessary for Customer’s protection.
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L. LIMITED LICENSE. Bank grants to Customer a limited, non-exclusive, non-transferable
license to use, in the manner and for the purposes set forth in this Agreement, the Image
Management Software and associated documentation provided by Bank for accessing and
using the Lockbox Services. Customer and its Authorized Users may use the Image
Management Software only in conjunction with the Lockbox Services. Customer represents
and warrants that it will use the Image Management Software only for its internal
use. Customer shall not remove any copyright, trade secret or other confidential protection
legend or notice that appears on or with the Image Management Software. Customer
acknowledges and agrees that any breach of this Agreement by an Authorized User or any
other employee, agent or contractor of Customer shall be deemed a breach of this
Agreement by Customer. Customer understands that all modifications, enhancements,
updates, changes, and error corrections to the Image Management Software provided
hereunder are and shall remain the property of Bank and/or its licensors. Customer further
understands that the term “Image Management Software” shall include any derivative works
arising from any changes, modifications, enhancements, updates and error corrections
provided hereunder. Customer shall have the right to use the Image Management Software in
accordance with the terms and conditions of this Agreement, and all other rights with respect to
the Image Management Software are expressly reserved to Bank and/or its licensors.
M. COPYRIGHT. The Image Management Software is copyrighted and contains the Confidential
Information of Bank and/or its licensors. Bank and/or its licensors retain all title to the Image
Management Software, and all copies thereof. Except as expressly licensed herein, no title to
the Image Management Software, nor any intellectual property rights in the Image Management
Software, are being transferred to Customer
N. NO COPIES. Customer understands and acknowledges that the Image Management Software
may only be accessed by Customer through the internet, and that Customer shall not have any
copies of the Image Management Software.
O. ENFORCEMENT. Bank and/or its licensors may: (i) enforce any provision of the Image
Management Software license granted hereunder; (ii) enjoin any unauthorized use by
Customer of the Image Management Software; and (iii) enforce any other right and seek any
remedy available at law or in equity. In the event of a material breach of this Agreement by
Customer, Bank shall, in addition to any other available remedies, be entitled to terminate the
Image Management Software license and immediately terminate Customer’s access to and use
of the Image Management Software.
P. IMAGE MANAGEMENT SOFTWARE UPDATES. Bank agrees to implement, within a
commercially reasonable period of time, any changes to the Image Management Software
necessary to make its functionality in compliance with any changes in the legal and regulatory
requirements governing performance of those functions. Customer agrees to promptly notify
Bank of any problems with the functionality or performance of the Image Management Software
and to provide Bank with whatever written documentation Bank reasonably requests for the
purpose of identifying and resolving problems associated with Customer’s use of the Image
Management Software. Customer’s failure to fulfill the above obligations shall relieve Bank of all
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liability regarding the accuracy or performance of the Image Management Software caused by
Customer’s failure to comply with the provisions of this section.
Q. LOCKBOX SERVICES AND IMAGE MANAGEMENT SOFTWARE SUPPORT. Bank agrees
to provide telephone assistance to Customer on Business Days from 8:00 a.m. to 6:00 p.m.,
Central Local Time, for the purpose of assisting Customer’s Authorized Users on the use of
Lockbox Services and the Image Management Software. All requests for support must be
made to either CustomerSolutionCenter@banksnb.com, or by calling (888) 762-4762 x101362.
Bank will not provide any maintenance services for Customer’s own equipment, computers,
networks or software under this Agreement.
R. SCHEDULED SERVICE INTERRUPTIONS. Bank reserves the right to conduct routine
system backups, maintenance work, software updates, equipment upgrades and other
activities at any time from 1:00 a.m. to 4:00 a.m. (Central Local Time) or at other times upon
at least forty-eight (48) hours advance notice to Customer. Customer acknowledges the
Image Management Software may from time to time be unavailable to Customer as a result
of system maintenance, upgrades or remedial work.
S. RESPONSIBILITY FOR DETECTION OF ERRORS. Bank is not responsible for detecting
any errors contained in any scanned image, in the index data viewed via Image Management
Software, or in any Checks processed via Lockbox Services. Customer is solely responsible
for the detection of any errors and for the notification of such errors to Bank.
T. CORRECTION PROCEDURES. Customer shall promptly notify Bank of any errors detected
arising from its use of the Lockbox Services. Bank will use commercially reasonable efforts
to correct any reproducible errors. In the event of a Check being processed through Lockbox
Services into Customer’s Deposit Account in error, Customer shall, within three (3) months of
such processing, notify Bank of the deposit error and Bank will take commercially reasonable
steps to correct the error, including debiting Customer’s Deposit account for the amount of
the Check.
U. ATTEST TO DATA DESTRUCTION OR RETURN. In the event that Customer receives Data
in error, Customer will promptly notify Bank and return the Data to Bank. In the event it is not
possible to return the Data to Bank, Customer will notify Bank that it will destroy the Data
using a licensed document destruction service or similar commercially reasonable method.
Bank will provide to Customer a document to complete attesting to the disposition of the
Data. Customer must return the completed document to Banks within the time frame stated
on the document. Failure by Customer to return the completed document to Bank within the
time frame stated may result in termination of the Lockbox Service by Bank at its discretion.