MBSA Schedule D – Deposit Account Issuance Terms

Deposit Account Issuance Terms

DEPOSIT ACCOUNT ISSUANCE

These Deposit Account Issuance Terms are provided in connection with the Master Bank Services Agreement which references these Deposit Account Issuance Terms between Program Manager and Evolve Bank & Trust (the “Agreement”). Capitalized terms used but not defined herein have the applicable meanings set forth in the Agreement. If approved by Bank in connection with a Program, Bank will provide Deposit Account Issuance in accordance with the terms set forth in these Deposit Account Issuance Terms, the Agreement and Bank Policies, and Program Manager shall comply with the terms set forth herein and as set forth in Bank Policies and the Agreement. Program Manager shall ensure all terms herein related or applicable to or otherwise referencing Program Manager (or its Subcontractor) that may be applicable to an End User are included in the Bank Services Agreement. Notwithstanding anything set forth herein or to the contrary, Program Manager shall only market Deposit Accounts to End Users and/or allow an End User to open a Deposit Account with Bank and submit to Bank transactions that are accepted by Bank as set forth in the Agreement, Program Schedules, these Deposit Account Issuance Terms Issuance) and Bank Policies. 

(a) General Description. Subject to the terms, provisions and conditions of the Agreement, Bank Policies, Compliance Policies, the applicable Program Schedule and these Deposit Account Issuance Terms, Bank shall issue Deposit Accounts to End Users under a Bank Services Agreement in connection with a Bank-approved Program, and Program Manager may market such Deposit Accounts and Deposit Account Services to End Users or Persons in accordance with the terms of the Agreement and the applicable Program Schedule provided for in the Program Schedules to the Agreement. Program Manager shall ensure that any Deposit Account Issuance or Deposit Account Services offered under any Program shall comply with these Deposit Account Issuance Terms, the Agreement, the Bank Services Agreement, Bank Policies, Compliance Policies and Applicable Laws.

(b) Issuance of Deposit Accounts.

(i) Bank shall be the issuer of all Deposit Accounts, vAccounts and FBO Accounts. Accordingly, Bank will establish, and issue Deposit Accounts marketed and promoted by Program Manager pursuant to these Deposit Account Issuance Terms and the Agreement.

(ii) Subject to the terms of the Agreement and Applicable Law, including those on bank branching, Bank agrees to issue and establish Deposit Accounts for End Users who meet the criteria set forth in Account Opening Policy, Bank Policies and have been approved for a Deposit Account with Bank and who reside in any state in the United States, its territories and the District of Columbia.

(iii) Program Manager acknowledges that Bank is under no obligation to issue a Deposit Account (including any vAccount) to any Applicant or End User in connection with any Program. Bank may, in its sole discretion, reject or decline to issue and establish a Deposit Account, vAccount and any related FBO Account if Bank determines to do so would constitute an unsafe or unsound banking practice, pose a reputational, compliance, operational, regulatory or financial risk to Bank or violate Bank Policies or Applicable Law.

(c) FBO Account Structure. To the extent a Program includes the issuance of Deposit Accounts to End Users and the Bank agrees to provide such End Users with a Deposit Account in connection with a Program, End User Deposits will be held in an FBO Account in which Bank pools the funds held by all End Users for their benefit.  A vAccount is established by Bank as a subaccount of such FBO Account. Each vAccount is required to be maintained on the Deposit Ledger and shall be subject to a Bank Services Agreement. 

(d) End User Deposits.

(i) In such manner as is approved by Bank from time to time, Program Manager shall facilitate each End User’s access to and use of Bank Services, including making Deposits to Deposit Accounts and engaging in other transactions relating to the Bank Services, subject to the terms of the applicable Bank Services Agreement.

(ii) Program Manager will administer the Deposit Accounts, vAccounts and related FBO Account(s), including providing Bank with instructions regarding the collection and application of payments in regard to the Deposit Account, vAccounts and related FBO Account(s) (as applicable). If payment is not timely made on a Deposit Account, vAccount or related FBO Account (as applicable), Bank shall have the right to exercise any security interest set forth in the Agreement or the Bank Services Agreement (if applicable).

(iii) Program Manager shall provide to each End User confirmation of each Deposit made to such End User’s Deposit Account or vAccount in the form, format, and in the cadence as determined by Bank or as otherwise specified in Bank Policies. Bank may elect to provide such confirmation to any End User directly, in which case, Program Manager shall provide Bank with full cooperation and assistance as requested by Bank.  Program Manager shall be responsible for all costs associated with Bank’s preparation and delivery of any such confirmation to any End User. 

(e) Obtaining a Deposit Account. To access a Deposit Account held by Bank, a Person must meet the standards set forth in the Account Policy, Bank Policies and otherwise must successfully complete Program Manager’s KYC process (as established pursuant to its BSA/AML/OFAC Program) and enter into a Bank Services Agreement with Bank. 

(f) Deposit Account Services.

(i) In performing its obligations under these Deposit Account Issuance Terms, Program Manager will act as Bank’s limited third-party service provider.

(ii) Program Manager will not commence any activities relating to the marketing or soliciting of End Users or Persons for Deposit Accounts or Deposit Account Services (as defined below) (including distributing or provisioning of Disclosure Materials) until Bank provides written approval to Program Manager to begin any Deposit Account-related marketing or activities, including any testing of such Program activities. Thereafter, Program Manager agrees to maintain its status as Bank’s third-party service provider consistent with and in compliance with Applicable Law, Compliance Policies, Bank Policies and in a manner that is consistent with the data security standards set forth in Section 23 (“End User Information”) and Section 24 (“Data Security”) of the Agreement.

(iii) Notwithstanding Bank’s issuance and establishment of any Deposit Account, vAccount or related FBO Account under these Deposit Account Issuance Terms and the Agreement, Program Manager shall provide, at its sole expense, the following Deposit Account services to support any Deposit Account, vAccount or related FBO Account offered, issued, and established in relation to or in connection with a Program under the Agreement (collectively, the “Deposit Account Services”) (the Deposit Account Services shall be considered part of the Program Manager Services under the Agreement):

                  1. i. Managing customer onboarding and compliance (including KYC review and delivery of Disclosure Materials to End Users), processing all Applications, establishing Deposit Accounts and supporting the Deposit Accounts, Deposit Account Services in connection with each Program on behalf of Bank and subject to Bank’s final approval, including, but not limited to providing information to Bank to establish the Deposit Accounts, vAccounts and related FBO Account;
                  2. ii. In connection with each Deposit Account (including any vAccount), Program Manager shall provide a mobile application and/or website, maintaining the technology, sub-ledger recording services, Program Manager Services, services set forth in the Agreement and all services not provided by Bank pursuant to the terms of the Agreement that are otherwise required to maintain and offer the Program and other aspects of the Deposit Account Issuance Services that do not constitute banking or money transmission;
                  3. iii. Transaction authorization, processing, clearing and settlement (unless performed by Bank) and all accounting relating to each Deposit Account, vAccount and related FBO Account, including but not limited to maintaining the Deposit Ledger, Records, and End User Information in connection with funds and account ownership attributable to each Deposit Account, vAccount and FBO Account and to reconcile transactions to the Deposit Accounts, vAccounts and related FBO Account;
                  1. iv. Customer Service, including, but not limited to helpdesk and technical support;
                  2. v. Data capture and reporting and information management services;
                  3. vi. End User dispute processing and resolution in accordance with the procedures set forth in the Agreement, Compliance Policies or Bank Policies and in accordance with Applicable Law, and any other informal disputes or resolutions as needed from the End User, as promptly as commercially reasonable, and not later than full resolution within sixty (60) days or as otherwise required by Applicable Law;
                  4. vii. Fraud prevention and security;
                  5. viii. Maintain ledger accounting of funds held in each Deposit Account, vAccount and related FBO Account and any other records required by Bank or Applicable Law or necessary to ensure “pass-through” FDIC insurance coverage to each such Deposit Account (where applicable);
                  6. ix. Maintain records that shall include, but are not limited to, daily entries of activity (beginning balance, daily transactions, and ending balance) for each Deposit Account, vAccount and related FBO Account. Program Manager’s records shall also include the name, address, date of birth and taxpayer identification number (or Social Security Number) of each End User with beneficial ownership in a Deposit Account, vAccount or related FBO Account;
                  7. x. Maintain processes and procedures to ensure that no funds are deposited by a foreign entity;
                  8. xi. Provide to Bank information requested by Bank on a daily or other basis as determined by Bank;
                  9. xii. Preparing and provide to any End User IRS Form 1099 or IRS Form 1099-INT for interest on any Deposit Account in accordance with Applicable Law (where and if applicable); and,
                  10. xiii. Any other services necessary or desirable to effectuate the offering of Deposit Account and Deposit Account Services under each Program or as requested by Bank from time to time.

 

(g) Obtaining a Deposit Account. To access a Deposit Account held by Bank, a Person must meet the standards set forth in the Account Policy, Bank Policies and otherwise must successfully complete Program Manager’s KYC process (as established pursuant to its BSA/AML/OFAC Program) and enter into a Bank Services Agreement with Bank. 

(h)Transaction Processing and Settlement.

(i) Program Manager will be responsible for and liable for all Program Manager Services for the Program and necessary to support the issuance by Bank of Deposit Accounts.

(ii)Program Manager will administer the Deposit Accounts, vAccounts and any related FBO Accounts, including posting transactions to the corresponding account(s). If a transaction is approved and there are insufficient funds in the Deposit Account, vAccount and/or related FBO Account, Bank shall have the right to exercise any security interest set forth in the Agreement or the Bank Services Agreement.

(iii)Program Manager, at its sole expense, shall provide for the Deposit Account Services in accordance with Section (c) (“Deposit Account Services”) of the terms of these Deposit Account Issuance Terms and Applicable Law and as otherwise necessary to support Deposit Account Services and settlement of each transaction made to or from any Deposit Account, vAccount or related FBO Account hereunder.

(i) Deposit Ledger: Program Manager is responsible for maintaining a Deposit Ledger accounting for the funds held in each Deposit Account, each vAccount and each related FBO Account or otherwise received by Bank in connection with the Bank Services along with maintaining all Records and End User Information in connection with such accounts in accordance with the terms and conditions of the Agreement, including Section 7(p) (“Program Records, Deposit Ledger and Subledger Services”). Program Manager acknowledges and agrees that maintaining the Deposit Ledger constitutes an accounting services function and that Program Manager does not have any ownership interest in, access to or control over any End User Deposit Account, vAccount, any related FBO Account or any funds deposited or remitted to Bank in connection with an End User’s use of the Bank Services. Bank controls the flow of funds into and out of the FBO Account, and Program Manager does not at any time accept or transmit End User funds.  Bank may reject any entry or instruction to debit or credit the FBO Account and/or any related vAccount or Deposit Account in its discretion.

(j) Data Files and Reports. Program Manager shall provide any data files to Bank at the frequencies and in the form reasonably required by Bank, including, but not limited to any reports provided by any Subcontractor or Critical Subcontractor that Bank can utilize for reconciliation and quality processes; provided, however, Program Manager is responsible for all reconciliation and quality processes. Bank may identify additional data files or reports to be generated by Program Manager and delivered to Bank on an ad hoc or periodic basis. Program Manager shall provide Bank with access to the Dashboard to enable Bank to adequately oversee the Deposit Account Services and other Program Manager Services in connection with each Program. Program Manager shall provide Bank with access to any sandbox environment and will cooperate with Bank in conducting any pilot test, including testing Deposit Account profiles, requested by Bank to establish and oversee any Program.

(k) Periodic Statements and Errors. Program Manager shall include all transactions on a periodic account statement and provide to each End User in accordance with Applicable Law and Bank Policies. Program Manager shall be responsible for requiring each End User to review its account statement(s) for any discrepancies, unauthorized transactions, or errors in connection with any transaction made to or from the End User’s Deposit Account. Except as otherwise provided herein, if Program Manager or End User believes a transaction is wrong or if more information about a transaction is needed, Program Manager will first be responsible for managing any End User complaints. Program Manager shall be responsible and liable for any damages or losses Bank incurs as a result of Program Manager’s or End User’s failure to notify Bank within the time period specified in the Bank Services Agreement or as otherwise required by Applicable Law. If Program Manager fails to notify Bank in writing of any discrepancy between its records and the information provided by Bank or any unauthorized or erroneous transaction that is reflected on the End User’s periodic statement within time period specified in the Bank Services Agreement or as otherwise required by Applicable Law, Program Manager and End User will be precluded from asserting a claim related to such discrepancy or erroneous or unauthorized transaction against Bank and agrees to waive any such claim.

(l) FDIC Insurance. To the extent agreed to in a Program Schedule provided for in the Program Schedules, Bank shall issue and maintain the Deposits in the Deposit Accounts, vAccounts and related FBO Account to ensure that each End User’s Deposits are insured by the FDIC up to the standard maximum deposit insurance amount per End User, per FDIC-insured bank and per ownership category as permitted under and subject to Federal Deposit Insurance Act and in accordance with the terms and conditions of the Agreement. Program Manager shall maintain (and shall ensure any Subledger Provider maintains) all necessary Deposit Ledger and Records necessary for Bank to provide such FDIC Insurance.

(m) Bank Deposit Custodial Program. Bank shall have the right in its sole and absolute discretion, and without limitation, at any time and from time-to-time to sweep funds from any End User Deposit Account, vAccounts and related FBO Account into a Custodial Account(s) pursuant to Custodial Program Terms.  Program Manager shall ensure that each Bank Services Agreement used in connection with establishing or supporting any Deposit Account, vAccount, related FBO Account or any other deposit of an End User with Bank under any Program under the Agreement includes terms substantially similar to the terms set forth in Custodial Program Terms to the Agreement (without limiting the foregoing and for the avoidance of doubt, each End User must consent to the terms set forth in Custodial Program Terms in its individual capacity and references to Program Manager as depositor and principal under the terms set forth in Custodial Program Terms are to be replaced with End User).