Common use of NACHA Clause in Contracts

NACHA. i. To the extent the Check Image Transaction processing services require any transactions to be processed as ACH Entries, Sub- Merchant shall be considered the Originators of such Entries. Sub-Merchant agrees: (a) to comply with the NACHA Operating Rules; (b) that Entries may not be initiated that violate the laws of the United States or any other jurisdiction in which the Sub- Merchant operates; and (c) that Sub-Merchant shall be responsible for the breach of any warranty under the NACHA Operating Rules with respect to Entries initiated by Sub-Merchant. Sub-Merchant is responsible for compliance with all requirements of the NACHA Operating Rules that pertain to the paper-based Entries processed hereunder. This responsibility includes, but is not limited to, responsibility for requirements pertaining to capture and initiation of Entries (including rules regarding eligibility of the underlying items), required notices to receivers, opt out rights, separation of fees, requirements concerning identification of the receiver, maintenance of a working telephone number that is answered during business hours for receiver inquiries, requirements to assure that underlying items are not presented such that any person will be required to pay on the underlying item, and requirements regarding keeping, destroying or providing copies or originals of the underlying items and related information. ii. Sub-Merchant may elect to have FTNI, through WorkWave, process Entries using FTNI’s designated partner settlement account. If Sub-Merchant so elects, Sub-Merchant shall be responsible for any special warranties or indemnities that FTNI is required to make under the NACHA Operating Rules as to such Entries. Sub-Merchant agrees to comply with all relevant data security requirements (including, but not limited to, those requiring the use of encryption technology where ACH information is transmitted over unsecured networks such as the internet other than through an application certified by FTNI). Sub-Merchant agrees that it will not reinitiate Entries except as permitted by the NACHA Operating Rules. Sub-Merchant agrees that reversing Entries and reversing files must be transmitted on a timely basis as required by the NACHA Operating Rules. iii. Sub-Merchant agrees to comply with and be bound by the NACHA Operating Rules, as they may be updated from time to time. The duties of Sub-Merchant set forth in this Appendix 3 in no way limit Sub-Merchant’s obligations to comply with the NACHA Operating Rules. Any fines or liabilities imposed against WorkWave, FTNI, or Financial Institution for a violation of the NACHA Operating Rules caused by an action and/or inaction of Sub-Merchant will be assessed against Sub-Merchant. Costs associated with NACHA Operating Rules publications and/or Association membership will be the responsibility of Sub-Merchant. To the extent that FTNI is required to indemnify any receiver, RDFI (as defined in the NACHA Operating Rules) or other third party in respect of such Entries FTNI processes on behalf of Sub-Merchant, Sub-Merchant agrees to reimburse FTNI.