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DocuSign Envelope ID: 85A15EAD-F9AE-4B80-8EE6-FBACB34C4780
<br />instances where Merchant contends that the foregoing bases For termination do not, in fact,
<br />exist
<br />(if) Sections 2.3, 3, 4, 5, 6, 7, 8.1, 9. I, 10.2, 11, 12, 13, 14, 15, 16.3, 16.4 17, 18.
<br />19, 20, 22, 23, 24, and 25 will survive termination of the Merchant Agreement.
<br />12. SETTLEMENT ACCOUNT
<br />12.1 Settlement Account Required. Merchant must maintain a Settlement Account in
<br />Merchant's name in satisfactory condition at a depository institution under arrangements
<br />acceptable to Processor. The Settlement Account will be subject to the provisions of Section
<br />14 of this Merchant Agreement.
<br />12.2 Minimum Balance. Merchant agrees to maintain a minimum balance of funds in
<br />the Settlement Account as Processor may specify to Merchant in wiling from time to time,
<br />12.3 Provisional Credits. Subject to the terns and conditions of the Merchant
<br />Agreement, Processor and Member Bank agree to provisionally credit Merchant for each
<br />Transaction that Processor accepts from Merchant. Merchant acknowledges that Processor
<br />and Member Bank may reverse or revoke such credit, including in response to any
<br />Chargeback. Furthermore, Merchant agrees that Processor and Member Bank may charge or
<br />debit the Settlement Account for the amount of any 'Transaction processed under the
<br />Merchant Agreement, or any agreement Processor or Member Bank may have with any
<br />Merchant Affiliate, that results in a Chargeback, or for any Credit Transaction Receipt or
<br />other reimbursement or Processing Fees or other Merchant obligation to which Processor or
<br />Member Bank may be entitled under the Merchant Agreement.
<br />12.4 Audits and Adjustments. Merchant agrees that Processor and Member Bank may
<br />audit all Transaction calculations and that Processor and Member Bank shall have the right,
<br />without notice, to make withdrawals, deposits, or other adjustments to or from the Settlement
<br />Account for any deficiencies or overages.
<br />12.5 Error unit Disputes. Processor and Member Bank shall be entitled to presume
<br />that cry amounts the Processor and Member Bank pays to or debits from Merchant are
<br />correct unless Mercha itdispules these by sending Processor written notice within thirty days
<br />of the date of the applicable statement containing any disputed payments or debits.
<br />PROCESSOR AND MEMBER BANK SHALL NOT RELIABLE FOR ANY DISPUTED
<br />PAYMENTS OR DEBITS, INCLUDING ANY ALLEGEDLY IMPROPER FEE(S),
<br />UNDERPAYMENTS, OR BILLING ERRORS, WHICH ARE NOT REPORTED TO
<br />PROCESSOR IN WRITING WITHIN SUCH TI4IRTY-DAY PERIOD.
<br />12,6 POS Equipment. If Merchant chooses to real or lease POS Equipment From
<br />Processor or utilizes software provided by Processor for use in processing Transactions,
<br />Merchant agrees to pay Processor: (a) a pre -determined monthly rental fee; (b) any initial
<br />upfioot costs as required; and (a) all applicable taxes for such POS Equipment or software
<br />utilization.
<br />12.7 Settlement Account Closure. If Ilia Settlement Account is closed, Processor or
<br />its designated representative may terminate the Merchant Agreement, effective immediately,
<br />upon written or oral notice (with written confirmation in the event of oral notice) unless
<br />Merchant opens anther Settlement Account acceptable to Processor. Merchant may change
<br />the Settlement Account upon prior written approval by Processor, which approval will not
<br />be unreasonably withheld.
<br />128 ACH Authorization. Merchant authorizes Processor aid Member Bank or their
<br />agents or designated representatives to initiate debit and credit entries and adjustments to the
<br />Settlement Account or the Reserve Account (described in Section 13 of the MPA) through
<br />the ACH settlement process for amounts due tinder the Merchant Agreement. This
<br />authorization will remnin in fill farce and effect until termination of the Merchant
<br />Agreement and the full and final payment of all obligations of Merchant due under the
<br />Merchant Agreement. Merchant acknowledges and agrees that Processor and Member Bank
<br />will not be liable for imy delays in receipt of funds, any failure by Merchant to receive funds,
<br />or errors it debit or credit entries caused by Merchant, or third parties, including but not
<br />Barred to any Card Association or any financial institution.
<br />13. ADDITIONAL COLLATERAL SECURITY; RESERVE ACCOUNT,
<br />As a condition for providing Card Program services, Merchant may, at Processor's
<br />discretion, be required to provide additional collateral security for Merchant's obligations
<br />hereunder, which additional collateral security shall be of a kind, and in amounts, satisfactory
<br />to Processor in Processor's sole discretion, mid which shall be in addition to all other
<br />collateral provided for in Section 14 hercof. Processor may require that all or any part of the
<br />additional collateral be deposited in a Reserve Account, in which case the following
<br />provisions of this Section 13 shall apply:
<br />13A Reserve During Term of Merchant Agreement.
<br />(a) .Merchant may be required to deposit, or Processor or Member Bank may
<br />deposit by deducting from any provisional credit or payment otherwise due to Merchant or
<br />from any funds in tine Settlement Account or any other deposit account of Merchant, into an
<br />account maintained by Member Bank (or at another approved depository institution) (the
<br />"Reserve Account"), initially or at any time in the future as requested by Processor, sums
<br />sufficient to satisfy Merchant's current and/or future obligations as determined by Processor
<br />in its sole and absolute discretion. In lien of establishing a Reserve Account, Processor may,
<br />at its election, demand and receive other forms of additional collateral security, including,
<br />without limitation, letters oferedit or certificates of deposit Failure to supply such additional
<br />collateral security shall constitute a material breach of this Merchant Agreement. -
<br />(b) The Reserve Account will be separate from the Settlement Account.
<br />Notwithstanding anything else in this Merchant Agreement to the contrary, Merchant shall
<br />have no ownership interest or property rights in the Reserve Account or the funds therein,
<br />no tight of withdrawal tram the Reserve Account, and no right to receive interest on funds
<br />held in the Reserve Account, Rather, the Reserve Account shall be under the sole control of
<br />P.L.
<br />Member Bank. Any and all earnings from deposits of Merchant to the Reserve Account shall
<br />be the sole properly of the Processor.
<br />13.2 Reserve Account Deposits.
<br />(a) At any time in Processor's sale and absolute discretion, Processor may (i)
<br />designate the minimum balance, required to be deposited in the Reserve Account, (it) require
<br />that the amount on deposit in the Reserve Account be increased, (iii) require that Merchant
<br />deposit, or Processor or Member Bank may deposit for Merchant into the Reserve Account
<br />a percentage of, or a fixed amount from each Transaction processed, or (iv) otherwise
<br />determine the amount to be deposited in (lie Reserve Account. Processor at its sole and
<br />absolute discretion may require that each month Merchant deposit, or Processor or Member
<br />Bank may deposit by deducting from any provisional credit or payment due to Merchant or
<br />from any Funds in the Settlement Account or any other deposit account of Merchant sums
<br />into the Reserve Account no later than the twentieth day of the month. Processor shall notify
<br />Merchant as to the amount of the funds to be deposited each month.
<br />(b) Merchant acknowledges aid agrees that the Reserve Account may contain
<br />both funds deposited by Merchant and funds of other merchants of the Processor.
<br />13.3 Deductions from Reserve Account. If funds are not available in the Settlement
<br />Account, Processor or Member Bark without prior notice to Merchant may deduct From any
<br />provisional credits or payment due to Merchant that are maintained in hie Reserve Account
<br />any current or future obligation of Merchant to Processor or Member Bank under the
<br />Merchant Agreement, including all Processing Fees, Chargebacks, Credit 'Transaction
<br />Receipts, Damages, and any and all additional fees and obligations tinder the terns of the
<br />Merchant Agreement, and sums sufficient to reimburse Processor and Member Bank for ilia
<br />amount of any liability assessments and charges due the Card Associations.
<br />13A Replenishment of Reserve Account Deficiencies. Whenever the balance in the
<br />Reserve Account is less than the minimum balance required, or is otherwise deficient,
<br />Processor or Member Bank may, without prior notice, deposit the deficiency into the Reserve
<br />Account by reducing any payment to Merchant required by the Merchant Agreement or
<br />deduct the deficiency from the Merchant's or Merchant's Affiliate's Settlement Account or
<br />any other deposit account of Merchant or Merchant Affiliate with another depository
<br />institution (including accounts of general partners if Merchant is a partnership) aid deposit
<br />it into the Reserve Account. Merchant authorizes deductions from its accounts by ACH entry,
<br />sight draft, preauthorized check, reverse wire, or otherwise as Processor and Member Bank
<br />deem appropriate under the circumstances. In addition, Merchant will deposit any deficiency
<br />into the Reserve Account within one Business Day after receiving Processor's oral or written
<br />request. Without limiting Processor's remedies, Merchant's failure to deposit any deficiency
<br />on time will permit Processor, without advance notice, to suspend or cease processing
<br />additional Transaction Receipts and Credit Transaction Receipts. Processor will give
<br />Merchant written notice of any suspension or cessation of processing.
<br />13.5 Additions to Reserve Accamnt. If Processor has reason to believe that Merchant
<br />may be liable to customers or to Processor for Chargebacks exceeding the balance in the
<br />Reserve Account, Processor or Member Bank may: (a) immediately place in the Reserve
<br />Account provisional credits or payments otherwise due to Merchant and/or stop processing
<br />transactions for Merchant until such timers the extentofMerchant's obligations to Processor
<br />and Member Bank, or Merchant's liability for Chargebacks, or Merchant's liability to
<br />customers are known, and Processor no longer deems itself insecure, and/or (b) demand from
<br />Merchant an amount that in Processor's I udgnient is needed to ensure payment of Merchant's
<br />obligations and liabilities. Merchant's failure to pay any amount will permit Member Bank
<br />or Processor or its designated representative to terminate the Merchant Agreement
<br />immediately without advance notice.
<br />13.6 Reserve Account After Merchant Agreement Terminates. Processor or
<br />Member Bank may continue to hold or deposit funds in the Reserve Account after
<br />termination of the Merchant Agreement, regardless of whether termination is by Merchant,
<br />Processor or Member Bank. Upon termination of the Merchant Agreement by Merchant,
<br />Processor or Member Book, Processor and Member Bank may retain ,sufficient funds to
<br />satisfy any and all Processing Fees, Chargebacks, Credit Transaction Receipts, Damages,
<br />and any and all additional fees, and sums sufociem to reimburse Processor and Member
<br />Bank for the amount of any liability assessments and charges due the Cad Associations or
<br />other obligations or liabilities arising or, in Processor's or Member Bank's discretion, likely
<br />to arise under the terms of the Merchant Agreement. If no ftm is have been deposited into
<br />the Reserve Account before termination, Processor, at Processor's option, may notify
<br />Merchant to deposit fluids into One Reserve Account upon termination of the Merchant
<br />Agreement. All provisions which apply to a pre -termination Reserve Account will apply
<br />after termination, including replenishment of deficiencies. The funds will be held by
<br />Processor and Member Bank or its designated agent for a period afoot less than one hundred
<br />eighty days from the date ofthe last Transaction, including, but not limiter) to a Chargeback,
<br />processed tinder the Merchmu Agreement, plus the period orany, warranty, guarantee, and/or
<br />return policy on goods atrl/or services sold. Processor and Member Bank will turn over the
<br />balance in the Reserve Account to Merchant after Processor reasonably determines that the
<br />risk of Chargebacks, Processing Fees or Merchant's liabilities or obligations under the
<br />Merchant Agreement has ended and alter deducting all amounts that Merchant owes to
<br />Processor and Member Bark under the Merchant Agreement or any other agreement.
<br />14. SECURITY INTEREST.
<br />14.1 Merchant's Grant of Security Interest.
<br />(a) To secure Merchant's performance of its obligations under this Merchant
<br />Agreement, and any miter agreement with Processor or Member Bank, Merchant grants
<br />Processor and Member Bank a security interest in each Transaction and its proceeds,
<br />provisional credits, the Settlement Account, the Reserve Account (without in any way
<br />suggesting that Merchant has ownership interest or property rights in the Reserve Account),
<br />and any other deposit account of Merchant with a financial institution, whether now existing
<br />or established in the Future, and in the proceeds of all those accounts, any funds due to
<br />our 10 UNIVMER AONIT v22.0421
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