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may be placed on hold or charged back to merchant, 3.5 SURCHARGES AND TAXES, MERCHANT shall not impose any illegal surcharge on any processed electronic checks. MERCHANT shall collect all required (axes at timo of gale. All required taxes must be included in the total transaction amount at the time such is submitted for authorizationby Paya-EFT and must be reflected in. the face amount of the electronic check. In any event, MERCHANT shall not collect any required taxes separately in cash, or otherwise. MERCHANT is responsible for paying all taxes collected to the appropriate authorities in a timely manner, SOFTWARE, MERCHANT shall utilize electronic check software provided by Paya-EFT for processing all electronic check transactions. (a) MERCHANT is responsible for all telecommunication fees and charges, including but not limited to telephone fees, associated with and related to the use of the software. (b) MERCHANT shall maintain all equipment necessarily related to electronic check processing, including necessary file servers, computer and telecomumunications equipment in good working order at MERCHANT sole expense. (c) MERCHANT shall advise Paya-EFT immediately in the event ofbreakdown of related equipment, electronic check software problems or of any other system failure, (d) MERCHANT acknowledges that Paya-EFT is not responsible for any related computer and telecommunications equipment used by the Merchant. In this regard, Paya-EFT shall not be responsible for any unauthorized tampering or altering to equipment and software specifically installed by Paya-EFT on the part the Merchant or Merchant's agent. Additionally, Paya-EFT's approval ofsuch equipment does not constitute an express or implied warranty, representation or endorsement of such equipment, USE OF EQUIPMENT, MERCHANT agrees to utilize only equipment approved by Paya-EFT for the electronic processing of Checks-By-Phone transactions and in a format and medium of transmission acceptable to Paya-EET. DAILY SETTLEMENT OF TRANSACTIONS, "Batch out" shall mean that MERCHANT totals and settles all of the transactions by midnight (12:00 am) of the day Paya-EFT authorizes the sale aud transmits the information contained in the batch out to Paya-EFT. In addition, any transactions contained in an untimely batch out may be refused or become subject to chargeback or held until after a sixty-day period for consumer chargebacks by Paya-EFT, If MERCHANT account is Checks-By-Phone Guarantee then electronic checks contained in an untimely batch out are not covered under the GUARANTEE program. If so requested by Paya-EFT, the signed writien ACH Authorization Form or Recorded Oral Telephone Authorization must be sent out and received at Paya- EFT’s designated location within 48 hours from the request date, Failure to do so will remove Paya-EFT’s obligations under the Guarantee program for such electronic checks at Paya-EFT's sole discretion, MERCHANT acknowledges that failure to batch’ cit on a timely basis may be grounds for suspension or termination at Paya-EFT's sole discretion, Paya-EFT reserves the right to hold additional monies as necessary to reduce any risk associated with daily processing of electronic checks, Paya-EFT also reserves thé right to move monies into an account of its choosing to hold it against retums to those monies and providing to the merchant a net deposit after a period of time acceptable to Paya-EFT, MERCHANT acknowledges that failure to batch out will delay funds being deposited and loss of guarantee coverage on those ACH transactions and Paya-EFT may apply a $25.00 fee for each terminal daily on which MERCHANT fails to trmsmita timely batch out, PROVISIONAL SETTLEMENTS, MERCHANT acknowledges that all settlemenits between Paya-EF'T and MERCHANT ate provisiosial and are subjectto the custonier's rights to dispute the charges against the customer's account, In submitting electronic checks to Paya-EFT, MERCHANT endorses and assigns to Paya-EFT all right, title and interest to such electronic checks with rights of endorsetuent MERCHANT acknowledges that Paya-EFT has the right to receive payment on all electronically processed checks acquired and MERCHANT will not attempt to collect on any such transactions, Fahy payment is tendered to MERCHANT, MERCHANT will notify Paya-EFT by telephone of the paynient, endorse the check, and sign it over to Paya ‘EFT and. immediately mail the payment to Paya-EFT by certified mail. If customer pays cash, MERCHANT shall reimburse Paya-EFTby MERCHANT's check. li AUTHORIZATION RETRIEVAL REQUESTS. Whereby a financial institution, regulatory or law enforcement agency, or similar authority has demanded ftom Paya-EFT proof of valid consumer authorization, in aecordance with NACHA Rules, Merchant shall provide said proof of authorization to Paya-EFT within (10) business days. In the event that Merchant cannot provide the appropriate consumer authorization, and Paya-EFT suffers a penalty enforced by NACHA, Paya-EFT shall have the right to offset such penalty and charge Merchant a minimum of ($1000 per | instance and up to a maximum of $100,000 per month until the problem is resolved. ELECTRONIC CHECK PROCESSING, Paya-EFT shall not be responsible for the payment of any Checks-By-Phone of MERCHANT that Paya-EFT has not recéived for processing from. MERCHANT within twenty-four hours of the initial transaction date of said Electronic check(s), MERCHANT shall be required to submit all documentation related to the transactions to Paya-EFT at Paya-EFT’s request. MERCHANT shall make its books and records available to Paya-EFT. 3 ELECTRONIC CHECKS FOR WHICH MERCHANT WILL NOT BE REIMBURSED UNDER CHECKS-BY-PHONE GUARAN TEE, In addition to the provisions set forth in this Agreement and notwithstanding any other. provisions to the contrary, Paya-EFT shall have no obligation to reimburse MERCHANT for ACH transactions that are: (a) Not honored by thé customer's financial + sinstitution because of the customer's instructions fo “stop payment” on the original source document or electronic check; b) Friudulent, wheihét MERCHANT, its employeés or agents are involved, either as a principal or as an accessory, in the issuance; (c) Accepted by MERCHANT or its employees with advance knowledge of the likelihood of its being dishonored even though authorized by Paya-EFT; (d)Lost, stolen, altered or counterfeit, and Paya-EET bas reasoui to believe that MERCHANT failed to use reasosabie care in verifying the customer's identity; (e) Given as a substitute for - a previously accepted check; whether or not the check was authorizedby Company or, any check upon which MERCHANT has accepted fall or partial payment; (8) One of multiple checks presented to MERCHANT iti a single transaction for electronic processing; (g) For goods, if the goods are subsequently retumed by customer or repossessed by MERCHANT or lien holder, within 65 days of date of purchase; (t) Not honored by the customers financial institution because ofthe failure of, the closing of, or goyermment-imposed restrictions on withdrawals frém the financial institition; (i) Checks for which MERCHANT returns cash back to the customer, unless MERCHANT is approved in writing by Paya-EFT for suich cash back; (j} Checks for which Paya-EFT previously denied authorization; (k) Not in compliance with this Agreement and n6t processed in accordance with the ACH transaction processing provisions of this Agreement; (1) Incorrect Ror . _ Number data entry; (m) unable to locate account or invalid account umber returns or unauthorized corporate account returns, In addition, before processing the check and as a condition to honoring the check, MERCHANT shall obtain sufficient personal information to locate the person presenting the check, including but not linited to a current home or business telephone number including area code, a current home address consisting of a street or rural route address, not a post office box, and the customer's valid, unexpired driver's license number or nonedriver identification number together with the state of issuance, and the last four digits of customer’s social security number or year of birthin YYYY format. MERCHANT shall ensure that this identifying information is legibly prinied on. the ACH Authorization form or clearly captured on the recorded oral authorization; (n) ACH Authorization form or recorded oral authorization must contain a current phone number of customer;-(0) ACH authorization forms or recorded oral authorizations must contain the customer’s drivers license number; (p) Paya-EFT must receive the completed ACH Authorization form or recorded. oral authorization within 48 hours of Paya-EI'T’s request; (0) MERCHANT'S failure to input into the Checks-By-Phone system the correct routing number or account number will result in MERCHANT'S loss of guarantee. * ADDITIONAL MERCHANT WARRNATIES. With each transaction presented to Paya-EFT by MERCHANT for authorization, MERCHANT specifically warrants and represents that: a) MERCHANT, nor any ofits employees have submitted Electronic checks drawn from their personal or business checking accounts on the MERCHANT's eleotronic check software; (b) MERCHANT uses only the name sind address shown on the front of the ‘Agréeirient on all its sales drafts, (c) MERCHANT has not submitted duplicates of any transaction; (4) MERCHANT ‘eastants that thé Checke-By-Phone banking information oa the printed receipt and writan or recorded ACH authorization is cotreet; and (¢)no ransantion submitted for authorization fo Paya-BFT is vweith or through an entity other than MERCHANT. 1s, SETTLEMENT NAD CHARGEBACKS, Settlement shall consist of a 7-business-day net settlement period. Chargebacks will be deducted from net settlement or may be debited from. MERCHANT’s account ifno pending credits are available to offset the chargeback, 15 20 3 REV05152023 Pi Page 14 off 11. 4143-1053-4164.4 PLEASE NOTE: The complete Merchant Agreement includes these Terms and Conditions and the Application on three (3) additional pages. 37048-2