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10. Processing, Transmittal and Settlement of
<br />Entries by Bank.
<br />10.1 Bank will process, transmit and settle for
<br />credit and debit Entries initiated by Customer as provided in
<br />the NACHA Rules as in effect from time to time, and pursuant
<br />to this Appendix. Exclusive of "Same Day ACH Entries,"
<br />which are described in Section 23 below, Bank will transmit
<br />such Entries as an ODFI to the ACH Operator by the deadline
<br />of the ACH Operator, provided such Entries are received by
<br />Bank prior to 8:00 p.m. Eastern Time ("ET") and the ACH
<br />Operator is open for business on such Business Day. Entries
<br />received after 8:00 p.m. ET will be deemed received the
<br />following Business Day. If the Effective Entry Date falls on a
<br />non -Business Day, final settlement will occur on the next
<br />Business Day. Customer may submit a NACHA-formatted file
<br />up to the time limit in advance of the Effective Entry Date as
<br />the Services permit, or as may otherwise be permitted by Bank
<br />under the terms of this Appendix. Customer will hold Bank
<br />harmless from all charges and liabilities that may be incurred
<br />as a result of the delivery of late Entries.
<br />10.2 If the file of Entries is received other
<br />than in specified NACHA and Bank format, Customer will
<br />be required to provide Bank with a corrected file. If a
<br />corrected file of Entries is received later than 8:00 p.m. ET
<br />on the delivery date with an intended Effective Entry Date
<br />of next -Business Day, Customer will hold Bank harmless
<br />from all charges and liabilities that may be incurred as a
<br />result of the processing of late Entries.
<br />10.3 For purposes of this Appendix, Entries
<br />shall be deemed received by Bank, in the case of electronic
<br />file transmission, when the transmission is completed as set
<br />forth in Bank's Appendix for Data Transmission Services
<br />and/or the Services' Setup Form(s).
<br />10.4 If any of the requirements of this Section
<br />10 (or of Section 23 with respect to Same Day ACH Entries)
<br />are not met, Bank shall use reasonable efforts to transmit
<br />such Entries to the ACH Operator by the next deposit
<br />deadline on which the ACH Operator is open for business.
<br />Any stale dated Effective Entry Date, may result in "Same
<br />Day ACH Entries".
<br />11. On -Us Entries. Except as otherwise provided
<br />herein, in the case of an Entry received for credit or debit to
<br />an account maintained by Bank (an "On -Us Entry"), Bank
<br />will credit or debit the Receiver's account in the amount of
<br />such Entry on the Effective Entry Date, provided the
<br />requirements set forth herein are otherwise met. If those
<br />requirements are not met, by reason of stale or same-day
<br />Effective Entry Dates on such Entries, Bank will credit or
<br />debit the Receiver's account in the amount of such Entry on
<br />the date the Entry was received by Bank, or if the Entry was
<br />received on a non -Business Day, Bank will credit or debit
<br />the Receiver's account in the amount of such Entry on the
<br />next Banking Day following the date the Entry was received
<br />by Bank. Bank will have the right to reject an On -Us Entry
<br />as described in Section 12, Returned or Rejected Entries. In
<br />the case of an On -Us Entry, Bank will have all rights of an
<br />RDFI including, without limitation, the rights set forth in
<br />NACHA Rules.
<br />12. Returned or Rejected Entries.
<br />12.1 In the event any Entry is returned or
<br />rejected by the ACH Operator or any RDFI or Intermediary
<br />Depository Financial Institution, it shall be the responsibility of
<br />Customer to (i) remake and resubmit such Entry, (ii) with
<br />respect to an ACH Debit Entry, enroll in Bank's Auto-
<br />Redeposit service or (iii) otherwise resolve the returned Entry
<br />in accordance with the NACHA Rules.
<br />12.2 Bank shall remake such Entry in any case
<br />where rejection by the ACH Operator was due to mishandling
<br />of such Entry by Bank and sufficient data is available to Bank
<br />to permit it to remake such Entry. In all other instances, Bank's
<br />responsibility will be to receive rejected or returned Entries
<br />from the ACH Operator, perform necessary processing, control
<br />and settlement functions, and to forward such Entries to
<br />Customer. Except for an Entry retransmitted by Customer in
<br />accordance with the requirements of Section 5, Transmittal of
<br />Entries by Customer, or the enrollment m Bank's Auto-
<br />Redeposit service for ACH Debit Entries, Bank shall have no
<br />obligation to retransmit a returned Entry to the ACH Operator
<br />if Bank complied with the terms of this Appendix with respect
<br />to the original Entry.
<br />12.3 Bank may reject any Entry which does not
<br />comply with the requirements of Section 5, Transmittal of
<br />Entries by Customer, or Section 7, Security Procedures. Bank
<br />may also reject any Entry which contains a future Settlement
<br />Date that exceeds the limits set forth within the Services. Bank
<br />may reject an On -Us Entry for any reason for which an Entry
<br />may be returned under the NACHA Rules. Bank may reject
<br />any Entry or file if Customer has failed to comply with its
<br />Settlement Account balance obligations under Section 2,
<br />Customer Obligations, or Customer's Exposure Limit under
<br />Section 3, Risk Exposure Limits. Notices of rejection shall be
<br />effective when given. Bank shall have no liability to Customer
<br />by reasons of the rejection of any such Entry or the fact that
<br />such notice is not given at an earlier time than that provided for
<br />herein. Bank may monitor Customer's rejected or returned
<br />Entries. Bank reserves the right, in its sole and exclusive
<br />discretion, to require Customer to establish a reserve Account
<br />in the event that an excessive number of Customer's debit
<br />Entries are rejected or returned.
<br />12.4 In accordance with NACHA Rules, Bank
<br />may monitor returned Entries, and in its sole discretion, may:
<br />(1) require Customer to lower its return rates, (2) invoke
<br />premium penalty fees for unauthorized or excessive return
<br />rates, and/or (3) invoke termination or suspension of the
<br />Services and/or this Appendix in conjunction with Section 31
<br />of this Appendix.
<br />12.5 In Bank's sole discretion, and upon
<br />Customer request, Bank may enroll eligible customers in the
<br />ACH Auto-Redeposit service for ACH debit origination. The
<br />service automates Customers redeposit of eligible returns due
<br />to insufficient funds (ROI) and uncollected funds (R09), one or
<br />two additional times, within nine (9) calendar days as selected
<br />by Customer at the time of enrollment in the service. Customer
<br />CAP ID 88442 0722
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