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described below). Each Check Issue File shall also identify any checks that have been cancelled by Customer prior to issuance. 2.2.2 Payee Verification Services. If Customer elects to receive payee venfication services in conjunction with the Services, the following additional terms shall also apply Bank's payee verification services require the payee name to match against Customer's Check Issue File at a minimum threshold or matching score. The payee name in the Check Issue File will be electronically compared to the payee name on Presented Checks. Other information related to the payee name may also be electronically compared as part of the automated verification process to establish a matching score. Such comparisons that result in a minimum threshold or matching score will be deemed to be a matching check. Customer is responsible for complying with the payee verification services' check specifications as specified by Bank from time to time in order to ensure the highest level of performance from the payee venfication services. If Customer is unable or unwilling to comply with the payee verification services' check specifications as specified by Bank, Bank may, in its sole and exclusive discretion: (a) terminate or suspend Customer's use of the payee verification services as provided in the Cash Management Master Agreement, or (b) at Customer's request, re- configure the software associated with the payee verification services to systematically process Presented Checks in reliance solely on the payee name provided by Customer to Bank in the Check Issue File and without regard to any other information related to the payee name that may appear on the Presented Checks (hereinafter "Systematic Ovemde Checks"). Any Presented Check or Systematic Ovemde Check that does not result in a minimum threshold or matching score shall be deemed an Exception Check and reported as such in accordance with the terns of this Appendix. Except as may otherwise be provided m this Appendix and in the Cash Management Master Agreement, Bank shall have no liability for Systematic Override Checks. 2.2.3 Customer shall send the Check Issue File to Bank in the format and medium, by the deadlme(s), at scheduled day(s), at the place(s) specified by Bank and agreed to by Customer, as set forth in Services' Setup Form(s). The deadline for transmissions of the Check Issue File to Bank shall be set forth in the Services' Setup Fonn(s). 2.3 Payment of Presented Checks and Reporting of Exception Checks. 2.3.1 Bank shall compare each Presented Check by check number, check amount and payee name (if Customer elects to receive payee verification services) against each Check Issue File received by Bank. Bank may satisfy its obligation hereunder by comparing check number, amount and payee name (if applicable) set forth in Substitute Checks, checks presented over-the-counter at one of Bank's teller stations and/or electronic presentment of checks. On each Business Day, Bank: (a) may pay and charge to the Authorized Account each Presented Check that matches, by check number, amount and payee name (if applicable), a check shown in any Check Issue File; (b) may pay and charge to the Authorized Account all Systematic Override Checks that match, by check number, amount and payee name (if applicable and as described herein), a check shown on any Check Issue File; and (c) shall provide to Customer an Exception Check Report that indicates whether Bank has received any Exception Checks and, if so, provide the image of the Exception Check(s) by the deadline set forth in the Services' Setup Form(s) via the Bank Internet System. Customer must provide check payment approval or return instructions to Bank -on each Exception Check reported by the deadline set forth in the Services' Setup Form(s) via the Bank Internet System ("Pay or Return Decisions"). 2.3.2 Bank shall not pay any Presented Check for which Bank has received from Customer a stop payment request consistent with the terms and conditions of the parties' eTreasury Services Appendix or the Account Agreement. 2.4 Payment and Dishonor of Exception Checks. Except as provided in Section 2.4.4 below, Bank will pay or return Exception Checks in accordance with Customer's Pay or Retum Decisions. 2.4.1 Pay Decisions. Bank shall finally pay and charge to the Authorized Account, to the extent there are sufficient Available Funds in the Authonzed Account, any Exception Check that Customer directs Bank to pay 2.4.2 Return Requests. Bank shall return to the depositary bank any Exception Check drawn on an Authorized Account that Customer directs Bank to return. 2.4.3 Default Options. If Customer fails to provide Pay or Return Decisions to Bank in accordance with these requirements, Exception Checks will be handled in accordance with the default option as set forth in the Services' Setup Form(s) for each Authorized Account, in accordance with the following: (a) Return Default. Where Customer has selected the return default option, Bank shall return to the depositary bank any Exception Check drawn on that Authorized Account. (b) Pay Default. Where Customer has selected the pay default option, Bank may finally pay and charge to the Authorized Account any Exception Check drawn on that Authorized Account. 2.4 4 Checks Presented for Payment at Bank Teller Stations. 2.4 4.1 Notwithstanding anything in this Appendix to the contrary, Bank may, in its sole and absolute discretion, retum to the person presenting HCYt 4536-1579-3465 v.1 37 of 58 0916 P51