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5.3 Customer acknowledges the right of a
<br />consumer Receiver of an unauthorized debit Entry, as
<br />applicable and as described in the NACHA Rules, to obtain a
<br />refund of the funds debited from Receiver's account by
<br />such Receiver sending a written notice to Receiver's
<br />Receiving Depository Financial Institution ("RDFr') in
<br />accordance with the NACHA Rules (i.e., a Written
<br />Statement of Unauthorized Debit), and where such
<br />notification is received in time and in a manner that
<br />reasonably allows the RDFI to meet the deadline for
<br />transmitting a Return Entry as provided in the NACHA
<br />Rules. Customer also acknowledges the right of a
<br />corporate Receiver of a debit Entry, as applicable and as
<br />described in the NACHA Rules, to obtain a refund of the
<br />funds debited from such Receiver's account by such
<br />Receiver sending a notice to Receiver's RDFI within two
<br />(2) Business Days following the Settlement Date of the
<br />original Entry Customer indemnifies Bank against any
<br />such claim for a refund by any Receiver
<br />5 4 In accordance with this Appendix,
<br />Customer may use the Services to initiate and transnut
<br />credit and debit Entries with certain Standard Entry Class
<br />("SEC") Codes. Authorized SEC Codes include PPD,
<br />PPD+, CCD, CCD+ and CTX. All other SEC Codes may
<br />be used with proper designation on the Services' Setup
<br />Form(s) and in accordance with additional instructions
<br />from and requirements by Bank, as applicable. Bank may
<br />also suspend or terminate Customer's use of one or more
<br />SEC Codes at any time m Bank's sole and exclusive
<br />discretion.
<br />6. International ACH Transactions ("IAT
<br />Entries").
<br />6.1 An IAT Entry is a debit or credit Entry
<br />that is part of a payment transaction involving a Financial
<br />Agency located outside of the territorial borders of the
<br />United States, which is processed through the domestic
<br />ACH network, pursuant to the NACHA Rules, including the
<br />rules pertaining to International ACH Transactions. IAT
<br />Entries also include those that are funded directly by an
<br />incoming international wire or similar funding source. The
<br />NACHA Rules establish SEC Code "IAT" for all
<br />International ACH Transactions. Customer agrees to be
<br />bound by the NACHA Rules and all other statutes and
<br />regulations pertaining to IAT Entries, including all
<br />applicable OFAC and FinCEN rules and regulations
<br />associated with IAT Entries. Customer acknowledges that
<br />1AT Entries require additional mandatory information,
<br />according to special formatting requirements, in the
<br />computer record for such Entries within an ACH batch file.
<br />Customer expressly agrees to identify and properly initiate
<br />all IAT Entries. Bank will facilitate IAT Entries to
<br />Receivers located in foreign countries approved by Bank
<br />and facilitated by the ACH or the Gateway Operator
<br />(hereinafter in this Section, collectively, "ACH Operator").
<br />Bank will process each IAT Entry in accordance with (a)
<br />the laws and payment system rules and requirements of the
<br />receiving foreign country ("Foreign Country Rules"), (b)
<br />any agreement governing IAT Entries between Bank and
<br />the ACH Operator through which Bank processes the IAT
<br />Entry, the terms of which Bank communicates to Customer
<br />prior to Customer's use of the Services or from to time
<br />thereafter, and (c) the NACHA Rules
<br />6.2 Customer acknowledges and agrees
<br />that IAT Entrees may be subject to laws, regulations and
<br />restrictions of U.S. and foreign governments relating to
<br />foreign exchange transactions. Before initiating an IAT
<br />Entry, Customer agrees to understand and accept the
<br />Foreign Country Rules. An IAT Entry must be authorized
<br />by the Receiver. The form and content of the Receiver's
<br />authorization, including whether such authorization is oral,
<br />electronic or written, is governed by Foreign Country
<br />Rules. Customer assumes the risk of rejection of its Entrees
<br />according to Foreign Country Rules, Bank and the ACH
<br />Operator Customer expressly acknowledges and agrees
<br />that Outbound IAT Entries, once transmitted, are
<br />irrevocable and are subject to the Foreign Country Rules;
<br />furthermore, the time frames for return of an Entry are
<br />determined by the Foreign Country Rules and may exceed
<br />the sixty (60) day return window for consumer Entries
<br />defined by the U.S. ACH system and the NACHA Rules, as
<br />well as the return window for non -consumer Entnes.
<br />Customer also agrees that IAT Entries may not be
<br />dishonored, reversed or settled upon a specific date, and
<br />that pre -notifications are not permitted with respect to IAT
<br />Entries involving certain foreign countries. To the extent
<br />not otherwise prohibited by law, in connection with IAT
<br />Entries, (1) Customer assumes the risk of all fluctuations in
<br />foreign exchange rates or availability, and (2) Customer
<br />assumes the nsk of loss for creating any and all erroneous
<br />IAT Entries. Customer acknowledges and agrees that the
<br />processing, settlement and/or availability of such Entries
<br />may be delayed or suspended in the event that Bank
<br />determines that enhanced scrutiny or verification of such
<br />Entries is necessary under the NACHA Rules and/or
<br />applicable U.S. law The ACH Operator through which
<br />Bank processes the IAT Entry, in its sole discretion, may
<br />also refuse to handle IAT Entries. Customer acknowledges
<br />that Bank shall have no liability for such delay or refusal.
<br />6.3 In addition to the provisions of Section 22
<br />of this Appendix, Customer makes the following additional
<br />representations and warranties with respect to any IAT
<br />Entry submitted by Customer or on Customer's behalf:
<br />6.3 1 Customer is in compliance with U.S.
<br />law, including, but not limited to, Customer's obligations
<br />under programs administered by OFAC and FinCEN, and
<br />6.3.2 The origination of an Outbound IAT
<br />Entry is in compliance with the Foreign Country Rules,
<br />including any requirements regarding authorization with
<br />respect to an IAT Entry.
<br />6.4 Bank will not be liable for (a) any failure
<br />or delay by the ACH Operator, any intermediary financial
<br />institution, or the financial institution designated to receive
<br />the IAT Entry in the receiving country in processing or
<br />failing to process any IAT Entry that is transmitted to the
<br />receiving country, or (b) the acts or omissions by a third
<br />party, including without limitation, the delay or failure of
<br />any third party to process, credit or debit any IAT Entry
<br />Bank is also not responsible for the transmission or
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<br />P38
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