Terms and Conditions

Processor, in conjunction with one or more Originating Depository Financial Institutions (“ODFI”), payment processors, and other service providers, provides payment processing, settlement, escrow, and related financial technology services. Client agrees to comply with this Agreement, all applicable laws, rules and regulations including without reservation the NACHA Operating Rules, applicable card network rules where applicable, and all federal, state, and local laws (collectively the “Rules”) at all times during the Term. This Agreement will continue in full force and effect throughout the Term, and the terms herein that survive termination of the relationship, and the Term will continue as set forth herein.

Processor may provide one or more of the following services, if applicable, as selected on the application attached hereto as Exhibit A (the “Application”), and as agreed upon in writing by the Processor, which may include:

• ACH origination (credit and debit entries)
• Credit and debit card processing
• Returned check representment (RCK)
• Escrow or trust account management
• ACH Net funding
• Lockbox processing
• Remote Deposit Capture
• Remotely Created Check

The services set forth in the Application and agreed to by Processor are collectively referred to herein as the “Services.”

Processor may utilize third-party vendors, payment processors, banks, and service providers to perform these Services in its sole discretion and without approval from Client.

Client authorizes Processor to originate ACH debit and credit entries on Client’s behalf through an ODFI.

Client warrants, represents and agrees that all ACH transactions will comply with all Rules including without limitation:

• NACHA Operating Rules
• Regulation E (where applicable)
• OFAC sanctions regulations
• All applicable laws and regulatory requirements

Client is solely responsible for the authorization of all ACH entries.

Client represents and warrants to Processor that prior to initiating any ACH entry, Client has obtained a valid authorization from the Receiver as required by the Rules.

Client must retain proof of authorization for at least two (2) years after the termination of the authorization, or longer if required by the Rules.

Client must provide Proof of Authorization (“POA”) within 48 hours upon request by Processor.

Failure to provide POA may result in:

• Suspension of processing
• A non-compliance fee of $250.00 assessed to Client for each instance of failure to provide POA within the required 48-hour timeframe
• Third-party and governmental fines, including but not limited to those assessed per NACHA Rules
• Termination of Services

Settlement and funding may occur, in Processor’s sole discretion and which may change in Processor’s sole discretion throughout the Term, using one or more of the following methods as determined by the Processor with written notice to the Client:

Processor will initiate settlement of funds collected through the ACH network to Client’s designated settlement account.

Settlement timing may vary depending on risk evaluation which occurs throughout the term of the relationship, underwriting approval, and network processing times. Settlement timing will be established by Processor in its discretion, and Processor will communicate changes in timing to Client.

Funds may be collected and held in a pooled trust or escrow account controlled by Processor or its banking partner, and if pooling occurs, Processor will maintain accurate controls and accounting methods to account for Client’s funds. In such cases:

• Funds may be accumulated for later disbursement
• Disbursements may occur based on instructions from Client
• Funds may be distributed to third-party beneficiaries as directed by the Client’s customer in writing

Processor acts solely as a payment facilitator and funds administrator and does not guarantee performance of any service provided by Client. Processor is not responsible for:

• Client’s failure to submit payout instructions
• Delays caused by Client operations
• Disputes between Client and its customers

In certain programs Processor may provide net funding services. Under this structure:

• Payments received may be aggregated
• Fees, chargebacks, returns, and reserves may be deducted prior to settlement
• Client may receive net proceeds rather than gross settlement

Processor may apply net funding to manage: credit risk, return exposure, chargeback liabilities, and regulatory obligations.

All settlements may be net of:

• Returns
• Chargebacks
• Processing fees
• Fines or penalties
• Reserve funding
• Adjustments

Client authorizes Processor, in its discretion, to debit Client’s settlement disbursement for any outstanding amounts owed and due to Processor.

Processor may require Client to maintain a Reserve Account or Security Deposit to cover risk exposure. Reserves may be funded through:

• Deductions from settlement
• ACH debits
• Collateral deposits
• Letters of credit

Reserve funds may be held for the later of: (i) 180 days following termination of this Agreement, (ii) the date of the last processed transaction, (iii) the date of the last return, (iv) the date of the last Proof of Authorization (POA) request or submission, or (v) as required by the Rules.

Client is responsible for all returned transactions and chargebacks, and will fully reimburse Processor upon demand.

Processor may suspend processing if return rates exceed thresholds established by NACHA, the ODFI, or the Rules.

Client agrees to reimburse Processor upon demand for:

• Returned entries
• Chargebacks
• Network fines
• Regulatory penalties

Client agrees to pay all fees described in the Fee Schedule attached to the Application.

Processor may collect fees by:

• Deducting from settlement payments/disbursement to Client
• Debiting Client’s bank account

Processor may adjust fees if third-party costs increase, on a proactive basis, after providing Client 30 days advance written notice of such increase.

Client must dispute any billing discrepancies within 30 days.

POA Non-Compliance Fee: A fee of $250.00 applies for each instance in which Client fails to provide Proof of Authorization within the required 48-hour timeframe (see Section 2.2).

The Agreement begins upon acceptance and continues for 24 months. This Agreement will automatically renew for successive twelve (12) month terms unless either party provides written notice of termination at least ninety (90) days prior to the end of the then-current term.

If the Client chooses to terminate this Agreement without cause prior to the expiration of any term, the Client agrees to pay the Processor the greater of $495.00 or the equivalent of the average monthly processing fees assessed from the beginning of the agreement term for each of the remaining months of the term. The Processor may terminate this Agreement without regard to breach or default upon thirty (30) days written notice to the Client if directed by a Regulatory Authority to close an account. Notice may be fewer than 30 days if required by Regulatory Authority.

Processor may immediately terminate the Agreement if:

• Client violates NACHA Rules
• Client engages in fraud
• Client breaches the Agreement
• Regulatory authorities require termination

Both parties agree to maintain the confidentiality of proprietary information and Customer Data. Processor may share information with banks, regulators, law enforcement agencies and payment networks as required to provide the Services.

Confidential Information shall mean information, data or material deemed proprietary by Processor and Client whether or not it is marked as confidential, or, if orally transmitted, designated as “Confidential” and not generally known by the public or by parties which are competitors with or otherwise in an industry, trade or business similar. Confidential Information also includes any information which Processor or Client obtains from another party and which Processor or Client treats as proprietary or designates in writing as Confidential Information, whether or not owned or developed by such party. Confidential Information includes, but is not limited to: Consumer Information (as defined below), discoveries, ideas, concepts, software in various stages of development, designs, drawings, specifications, techniques, models, data, source code, object code, algorithms, documentation, user manuals, diagrams, flow charts, consulting methods and techniques, research, development, processes, procedures, “know-how,” marketing techniques and materials, marketing and development plans, price lists, pricing policies and financial information, methods of production, use, operation and application, invented, owned or developed by either party as it applies to and is incorporated in each party’s proprietary software, and any patents, copyrights, or trademarks existing now or for which applications may be pending or hereafter made, acquired and granted for any software. Confidential Information further includes data regarding business practices, pricing, product philosophy, position relative to competitors, and review of actual deliverables of projects.

Consumer Information means non-public identifiable information including all lists of customers, former customers, applicants, financial information, pricing information, information concerning business plans, and any list or grouping of customers derived from personally identifiable information that is not publicly available.

Both parties agree to use the Confidential Information solely in furtherance of its business dealings with the other and for no other purpose whatsoever. The parties further agree that, in consideration for the other party’s disclosure of Confidential Information, they will not, at any time prior to the date immediately preceding the fifth anniversary of the termination of this Agreement, attempt in any manner to commercially exploit the proposed business concepts and plans of the other party or any of the Confidential Information without the other party’s prior written consent, which may be given or withheld in its sole discretion.

Definition of Customer Data. “Customer Data” means all data and information about Client’s businesses, customers (current, former or prospective), employees and their families, operations, facilities, products, markets, assets or finances that Processor obtains, creates, generates, collects or processes in connection with providing the Services, and all Intellectual Property Rights in that data and information. As between Client and Processor, Client will own all of the Customer Data. All Customer Data shall be considered Confidential Information of Client and Processor agrees to treat all Customer Data as Client Confidential Information. Processor will not withhold any Customer Data as a means of resolving a dispute.

Both parties must implement security controls designed to protect sensitive financial data.

If a data breach occurs, the affected party must notify the other party promptly.

Processor will not be liable for:

• Indirect or consequential damages
• Lost profits
• Losses caused by third-party networks
• Unauthorized access beyond Processor’s control

Processor’s total liability will not exceed the fees earned during the three-month period prior to any breach or alleged breach.

Both parties agree to indemnify each other and banking partners against any losses, damages, costs and expenses, including but not limited to attorney fees, arising from:

• Unauthorized transactions
• Violation of NACHA Rules
• Violation of applicable laws
• Client negligence or misconduct
• Client’s breach of this Agreement
• Any third-party claims arising out of this Agreement in which the Processor did not act with gross negligence or willful misconduct

This Agreement shall be governed by the laws of the State of North Carolina.

Venue for disputes shall be brought exclusively in the courts having proper jurisdiction in Mecklenburg County, North Carolina, and the parties hereto irrevocably consent to the personal jurisdiction of such courts.

Processor shall not be liable for delays caused by events outside its control, including natural disasters, telecommunications failures, or regulatory actions.

Client acknowledges that Milco Enterprises Inc. d/b/a Unity FI Solutions may act as a Third-Party Sender, Payment Facilitator, processor, or service provider under the NACHA Operating Rules in connection with the origination, processing, settlement, escrow administration, or net funding of transactions on behalf of Client.

Client further acknowledges that:

• ACH transactions are transmitted through an Originating Depository Financial Institution (“ODFI”)
• The ODFI maintains ultimate authority over participation in the ACH Network
• Processor may aggregate transactions for multiple Clients and submit them to the ACH network through the ODFI

Client agrees that:

• Processor may originate entries on Client’s behalf through its ODFI and processing partners
• Client remains the Originator under the NACHA Rules and is responsible for compliance with all Rules and applicable laws
• Processor may monitor Client’s processing activity for compliance with NACHA Rules and regulatory requirements
• Processor may request documentation, including underwriting information, transaction documentation, and Proof of Authorization

Client agrees to cooperate with all compliance reviews conducted by Processor, the ODFI, NACHA, or any regulatory authority. Failure to cooperate with such reviews may result in the immediate suspension or termination of processing services.

Client acknowledges that the current NACHA Operating Rules impose limits on return rates for ACH transactions. Client agrees to operate within the current NACHA thresholds, as they may be amended from time to time, but which are currently:

Unauthorized return codes include but are not limited to: R05, R07, R10, R29, R51.

If Client exceeds these thresholds, or if Processor reasonably determines that return activity poses elevated risk, Processor may take one or more of the following actions:

• Require a reserve account
• Increase reserve levels
• Extend settlement delays
• Reduce transaction limits
• Require additional underwriting documentation
• Temporarily suspend processing
• Terminate the Agreement

Client agrees to pay any fines or penalties assessed by NACHA, the ODFI, or any regulatory authority resulting from Client’s processing activity.

Client acknowledges that Processor’s ability to provide Services is dependent upon relationships with one or more financial institutions, including the ODFI, sponsor banks, settlement banks, and payment processors.

Client agrees that:

• The ODFI and/or sponsoring bank may require Processor to suspend, limit, or terminate Client processing activities at any time
• Processor may immediately comply with any directive from the ODFI, sponsor bank, NACHA, or regulatory authority without prior notice to Client if necessary to maintain compliance or manage risk
• Processor shall not be liable for any damages, losses, or delays resulting from actions taken to comply with such directives

If required by an ODFI, bank partner, or regulatory authority, Processor may:

• Suspend Client’s ability to process transactions
• Place a hold on settlement funds
• Increase reserve requirements
• Close Client accounts

Client acknowledges that these actions may occur without prior notice where required by regulatory or banking obligations.

Client understands and agrees that:

• Funds held within pooled settlement accounts may be temporarily commingled with funds associated with other Clients or programs solely for processing and settlement purposes
• Processor shall maintain appropriate internal accounting records to track Client balances and settlement obligations
• Client’s entitlement is limited to the net settlement amount owed to Client after all applicable deductions
• Funds held within pooled settlement accounts do not constitute a deposit account owned by Client
• Processor may place holds on funds where necessary to manage risk exposure, including potential returns, disputes, or regulatory obligations

Client acknowledges that such pooled settlement structures are commonly used within the payments industry and are necessary to facilitate efficient processing of ACH transactions and related services.

Client acknowledges that it may utilize Processor’s Services to collect payments from its own customers, clients, or program participants (collectively, “Client Clients” or “Sub-Clients”).

Client agrees that Client is solely responsible for the conduct, compliance, and activities of all Client Clients whose transactions are processed through Client’s account with Processor, and shall ensure that all Client Clients comply with:

• NACHA Operating Rules
• Applicable federal and state laws
• Card network rules (if applicable)
• Consumer protection regulations

Client further agrees that Client remains the legal Originator of all ACH transactions initiated through Processor, even if the transactions are generated by Client Clients. Client shall:

• Perform appropriate due diligence and monitoring of Client Clients
• Maintain policies and procedures to prevent fraud and unauthorized transactions
• Provide Processor with documentation regarding Client Clients upon request

Processor may require Client to provide: Client lists, underwriting documentation, transaction activity reports, and compliance policies.

Processor reserves the right to: suspend processing related to any Client; require additional underwriting review; require a separate processing agreement for Client; or terminate Client’s account if Client presents unacceptable risk.

Client agrees to indemnify Processor and its banking partners against any losses arising from the activities of Client Clients or Sub-Clients.

During the Term and any Renewal Term, Client hereby agrees to obtain the Services listed in the Fee Section solely from Processor.

Client agrees to incur all fees associated with Notifications of Change. Client’s bank will notify Processor and Client of any changes that need to be made regarding Client’s account information. If the required change is not made by Client within the required timeline provided by the bank, and an additional notification is sent, a fee will be incurred by Client. Client agrees to pay a fee determined by Processor in its sole discretion for the third notification and any notifications to follow. If Client receives a fourth notification, Client will be reviewed for eligibility and Services may be terminated by Processor.

Processor does not, and cannot, control the flow of any documents, files, data or other information via the Internet, whether to or from Processor’s network, other portions of the Internet, or otherwise. Such flow depends in large part on the performance of Internet services provided or controlled by third parties. Actions or inactions of such third parties can impair or disrupt connections to the Internet (or portions thereof). Processor cannot guarantee that such events will not occur.

Accordingly, Processor disclaims any and all liability arising out of, resulting from, or related to such events, and in no event shall Processor be liable for any damages of any kind (whether in contract, in tort, or otherwise) attributable or in any way related to Internet infrastructure or the ability or inability to connect to the Internet.

Institution understands that, while Processor and its Processors have established certain security procedures, such as firewalls, codes, and/or data encryption designed to prevent unauthorized access to accounts or transactions, there can be no assurance that inquiries or transaction activity will be completely secure. Institution and Customer agree that Processor is not responsible for any such unauthorized access, delays, or malfunctions, and Processor is not responsible for the acts of third parties.

Thirty (30) or more days of processing inactivity will result in a processing limit decrease to $100 for both Credit and Debit limits. A transaction deposit hold will be placed on the account if transactions are processed after 30 days of inactivity.

If funds sit untouched in Client’s accounts, including without limitation the Reserve Account, for so long that the law considers them abandoned, Processor will notify Client to retrieve them. It is Client’s obligation to notify its customer. If not retrieved, Processor will keep the funds or send them to the appropriate governmental authority as legally required.

If Client does not process payments through its accounts, including without limitation the Reserve Account, for an extended period of time, or has not linked a valid bank account, Client may have a balance deemed unclaimed or abandoned under applicable law. If this occurs, Processor will provide notices as required by applicable law and instructions for transferring the balance. If funds still remain, Processor will escheat such funds as required by applicable law, or as permitted, to Client or Client’s customer.

Notwithstanding the preceding, funds held longer than 190 days will be charged a dormancy fee equal to 25% of the amount of the unclaimed funds. Such fee will be charged on a regular basis each calendar quarter. Client expressly agrees that such fee is reasonable and is regularly charged by Processor, and Client is expressly obligated to inform its customers of these fees.

This Agreement shall not be assigned or otherwise transferred by Client or Processor; provided, however, that Processor may assign this Agreement to its affiliates or the purchaser of all, or substantially all, of Processor’s assets or outstanding securities. Processor is required to notify Client thirty (30) days prior to the assignment of this Agreement to another entity. Failure to do so will constitute a breach of this Agreement and Client may terminate this Agreement.