15. Courtesy Coverage.

a. Nature of Courtesy Coverage. You do not generally have the right to make transactions in amounts that exceed the Available Balance of your Spending Account. Courtesy Coverage is a special feature, offered to certain accountholders who qualify, under which we may authorize certain purchase and withdrawal transactions initiated using your Spruce Card, up to a $20 negative Available Balance in your Spending Account (sometimes referred to as overdraft). Courtesy Coverage is not a loan or extension of credit. There is no fee for your use of Courtesy Coverage, although fees for related services continue to apply as described in the Fee Schedule, such as the out-of-network ATM withdrawal fee. When we disclose your Available Balance to you, it will not include the amount of any Courtesy Coverage available to you.

b. Accountholder Eligibility.

i. Initial Eligibility. Courtesy Coverage is an optional feature available to you if you have received at least $200 in ACH credits to your Spending Account over the past 35 days, including from your employer or benefits provider (excluding tax refund deposits), and you have a positive Available Balance. If you meet our initial eligibility requirements, you must also opt in to Courtesy Coverage in your Spruce Electronic Account.

ii. Ongoing Eligibility. Once you have opted in to Courtesy Coverage, the Courtesy Coverage feature may continue to be available for you as long as you continue to meet the eligibility criteria in each period of 35 days after initial activation and your Spending Account remains in good standing. However, we may choose to consider additional sources of deposits other than ACH credits, in our sole discretion, to determine whether you meet the requirement to have at least $200 in qualifying deposits in the relevant 35-day period.

c. Eligible Transactions and Item Processing. Courtesy Coverage is available only for Card purchase transactions, ATM withdrawals, and bank teller withdrawals (sometimes called over-the-counter withdrawals) using your Spruce Card. It is not available for any other type of transaction, including ACH transactions, check transactions, or transfers to your Spruce Savings Account. Items will generally be processed in the manner described in Section 6(f) above.

d. Agreement to Pay. If you use Courtesy Coverage so that it creates or increases a negative balance in your Spending Account, you agree you will add sufficient funds to your Spending Account within 30 days so that your Spending Account has at least a zero balance. If after 30 days you have not added sufficient funds to cover your negative balance, your ability to use Courtesy Coverage may be suspended or terminated. For more information on negative balances, please see Section 16 below.

e. Discretionary Feature. Courtesy Coverage is always provided in our sole and absolute discretion. Even if you meet all qualifications, we always reserve the right to decline any transaction if the Available Balance in your Spending Account is insufficient to cover the transaction plus any applicable fees. We have no obligation to notify you before we authorize or decline a transaction that would result in a negative balance in your Spending Account. We may suspend or terminate the availability of Courtesy Coverage at any time. Transactions exceeding the $20 Courtesy Coverage maximum will be declined.

f. Cancellation. If you wish to turn off Courtesy Coverage, you may turn it off in your Spruce Electronic Account. However, you will still be liable to pay any negative balances on your Spending Account, such as those already incurred through your use of Courtesy Coverage, or those resulting from other types of transactions. We may suspend or cancel your Courtesy Coverage if (i) you have a negative balance for more than 30 consecutive days or (ii) your cumulative qualifying deposits in your Spending Account over the relevant 35-day measurement period are less than $200.

16. Negative Balances.

a. Your Responsibility for Negative Balances. If your Spending Account has a negative balance for any reason — such as through your use of Courtesy Coverage or other circumstances, including a force pay transaction — you are responsible to pay all of it. Any credits or deposits to your Spending Account will be first applied to offset any negative balance before bringing your Spending Account positive. You authorize us to automatically debit your Spending Account for the amount of any negative balance when you add funds to your Spending Account. If you have not deposited sufficient funds to your Spending Account to cover the negative balance within 60 days of the creation of the negative balance, we may close and/or restrict your Spruce Accounts.

b. Right of Set Off. If your Spending Account has a negative balance for more than 30 days, we have the right to pursue collection, including the right of set off against your other bank accounts with us — which means that we can use the funds in any other account you have with us (including your Spruce Savings Account) to repay the negative balance in your Spending Account or other amount owed to us, to the maximum extent permitted by applicable law. If you do not ultimately pay the amount owed to us, we reserve all rights to pursue appropriate efforts to collect.

17. Bonuses and Incentives.

a. Referral Bonuses and Incentives. Emerald Financial Services may offer bonuses and incentives from time to time for referring new customers to open Spruce Accounts. Current terms, including eligibility, value, timing, and any conditions or limitations will be clearly disclosed in the Referral Bonus and Incentive Terms that can be found in the referral page of your Spruce Electronic Account, or for new Spruce Accounts, they can be found in the landing page after clicking a valid referral link. These terms are part of this   Spending Account Agreement and are hereby incorporated by reference.  Details for a referral bonus or incentive you received or attempted to receive will be archived in the Notices portion of your Spruce Electronic Account. Referral programs will not require you to make misleading statements, and all material terms will be disclosed upfront, as required by law.

b. Other Bonuses and Incentives. Emerald Financial Services may offer bonuses or incentives from time to time to new or existing Spruce customers. Current terms, including eligibility, value, timing and any conditions or limitations will be clearly disclosed in the Spruce Bonus and Incentive Terms that can be found at www.sprucemoney.com/legal, and form part of this Spending Account Agreement. Bonuses and incentives will not be conditioned on prohibited activities, and disclosures will comply with applicable banking and consumer protection laws.

18. Round Up. The Round Up Service is a Service by which you authorize us to round up your eligible Spruce Spending Account transactions to the nearest whole U.S. dollar amount and transfer the difference from your Spruce Spending Account to your Spruce Savings Account.

a. Eligible Transactions. Only the following types of transactions are eligible for the Round Up Service:

i. Signature and PIN transactions made with your Spruce Card;

ii. Card not present transactions made with your Spruce Card, which includes online transactions made using your 16-digit Spruce Card number;

iii. Withdrawals made from an ATM or at a point-of-sale device with your Spruce Card, including any associated ATM or other transaction fees; and

iv. Funds transfers through some third-party merchants and financial institutions in your Spending Account.

A transaction must settle while you are enrolled in the Round Up Service to be eligible. A transaction typically settles within 3 Business Days of the transaction date, though timing of settlement may vary depending on the circumstances of each particular transaction.

b. Round Up Transfer. Each eligible transaction will generate an associated transfer from your Spruce Spending Account to your Spruce Savings Account (a “Round Up Transfer”) at the time the eligible transaction settles. If more than one eligible transaction settles on a Business Day, then more than one Round Up Transfer will be made on that Business Day. The amount of the Round Up Transfer will be the difference between the actual dollar amount of an eligible transaction in your Spending Account and the next whole U.S. dollar amount (between $0.01 and $0.99). The funds availability provisions set out in the Spruce Savings Account Agreement will apply to Round Up Transfers. If an eligible transaction occurs before you are enrolled in the Round Up Service but settles after you have enrolled in the Round Up Service, that eligible transaction will generate a Round Up Transfer. Likewise, if an eligible transaction occurs while you are enrolled in the Round Up Service but settles after you have unenrolled in the Round Up Service, that eligible transaction will not generate a Round Up Transfer.

We cannot guarantee the method by which a third-party will process a transaction. Some merchants, utility service providers, and other financial institutions use different methods to process transactions at different times. As a result, some transactions with a merchant, utility service provider, or financial institution may cause a Round Up Transfer while other transactions with the same company may not cause a Round Up Transfer. If this occurs, it is usually because the merchant, utility service provider, or financial institution has used different methods to process similar transactions.

c. Exceptions.

i. A corresponding Round Up Transfer will not be made for purchase transactions that consist of a whole dollar amount (for instance, $3.00).

ii. If you do not have sufficient Available Balance in your Spruce Spending Account to cover the full Round Up Transfer, or if the eligible transaction has overdrawn your Spruce Spending Account, we will not make a Round Up Transfer for the associated eligible transaction.

iii. Only Spruce Card purchases made in the United States are eligible for the Round Up Service.

iv. Most ACH debits that you authorize to be made from your Spending Account by merchants, utility service providers, and other financial institutions will not cause a Round Up Transfer, though in limited circumstances an ACH debit may cause a Round Up Transfer.

d. Changes Following Initial Authorization. In certain instances, a transaction may change between the initial authorization and settlement, which may impact the associated Round Up Transfer(s). For example, some transactions may settle for a different amount than the initial authorization. This commonly occurs in transactions made at restaurants because the initial authorization may not include a gratuity. If a gratuity was added, the amount of the settled transaction will typically be more than the initial authorization because the settled transaction incorporates the added gratuity. Similarly, a single purchase may ultimately settle as multiple transactions. For example, some online merchants process a single purchase as multiple transactions if the purchase is divided into multiple shipments. In this case, each settled transaction will generate a Round Up Transfer even though originally made as a single purchase.

e. Cancelled or Reversed Purchases. If an eligible transaction is cancelled or reversed for any reason (including a dispute) after the corresponding Round Up Transfer has occurred, the corresponding Round Up Transfer will not be reversed.

f. Enrolling and Unenrolling. To use the Round Up Service, you must enroll via your Spruce Electronic Account. If you enroll in the Round Up Service, you may also unenroll via your Spruce Electronic Account. The unenrollment generally takes effect the same day you make your request if the request is made on a Business Day (or the next Business Day if your request is not made on a Business Day), though it may take up to 3 Business Days for that unenrollment to take effect. During that time, Round Up Transfers may continue to occur.

19. Other Services Available within your Spruce Electronic Account. In addition to the Services outlined in the Spruce Online and Mobile Services Agreement, you may have access to the following: 

a. Linked Accounts. We use Plaid to facilitate the linking of your external bank account via your Spruce Electronic Account, including verification of certain information or confirmation of your access to your account at the other financial institution. You may not link an external account to your Spruce Electronic Account unless you are an accountholder on the external account. By proceeding with linking your account, you understand and agree to allow us and Plaid to access information related to your external account, and that Plaid’s services are governed by Plaid’s End User Privacy Policy. We do not charge any fee for these transfers, but you should check with your other bank for any of its applicable fees. Availability of such funds, limits, and other details are subject to this Spending Account Agreement.  Funds may not be available in your Spending Account for up to 5 Business Days after the transfer from your other bank is initiated. Transfers from your Spending Account to your other bank can take up to 3 Business Days, but may take longer depending on the type of linked account. Check with your external account institution for any additional details. We reserve the right to further delay the availability of deposits funded by ACH debit of an external bank account to allow us time to verify the external account and receive the transferred funds. If you initiate the transfer before 12:45 p.m. Mountain Time (“MT”) on a Business Day, we will consider that day to be the day you initiated your transfer. If you initiate the transfer after 12:45 p.m. MT on a Business Day, we will consider the transfer to be made on the next Business Day. We reserve the right to modify or cancel this Service at any time, delay the timing of the transfer, or otherwise restrict this feature to mitigate potential loss.

b. Budget and Transaction Categories. To help you budget and keep track of your spending, you can categorize transactions in your Spruce Spending Account, track your transactions by category, add a category to a “Watchlist”, and set category-specific spending and income targets, referred to as “Spending Levels” and “Income Goals,” respectively (“Budget and Transaction Categories”).

i. Budget and Transaction Categories is provided solely for your informational and educational purposes. While we may attempt to automatically categorize transactions, you understand and agree that you are solely responsible for accurately categorizing the transactions in your Spruce Spending Account. You also agree that we are not responsible for any categorization errors that occur within the Budget and Transaction Categories service.

ii. We will not take any action with respect to your Spruce Accounts related to your use of Budgets and Transaction Categories. For example, we will not restrict or otherwise limit transactions in your Spruce Spending Account to adhere to a particular Spending Level you set. You agree that you are solely responsible for ensuring that the transactions in your Spruce Accounts comply with your desired spending and income targets, including any Spending Levels or Income Goals you set.

c. Direct Deposit Setup. From within your Spruce Electronic Account, you may be able to set up your paycheck to be direct deposited into your Spruce Spending Account (“DD Setup Service”). The DD Setup Service may not be available in all areas or for all employers. The DD Setup Service is a third-party service provided by Atomic FI, Inc. and is governed by the Atomic End User Terms and Privacy Policy (the “DD Setup Service Terms”). By using the DD Setup Service, you understand and agree to the DD Setup Service Terms and that any information provided will be governed by Atomic’s privacy notice. Please refer to the DD Setup Service Terms for full information on the DD Setup Service.

d. Mobile Check Deposit.

i. Nature of Service.

1. Eligible Accounts. Your Spruce Accounts must be open and in good standing for at least thirty (30) days and you must have deposited at least $200 to your Spruce Spending Account over the past twelve (12) months to be eligible to use the Mobile Check Deposit Service. Not all Spruce Accounts are eligible for the Mobile Check Deposit Service, and we reserve the right to refuse or revoke your eligibility at any time for any reason in our sole discretion. The Mobile Check Deposit Service is only available for use within the Spruce App. To use the Mobile Check Deposit Service, you must permit location sharing in the settings for the Spruce App on your mobile device.

2. Eligible Items. The Mobile Check Deposit Service can only be used for eligible Deposit Items. We reserve the right to determine, in our sole and absolute discretion, whether a particular Deposit Item is eligible for deposit. When you transmit an Image to us, you agree that the Image is an “item” as defined by the version of the Uniform Commercial Code applicable to your Spruce Spending Account. The following items are not eligible and you agree not to use the Mobile Check Deposit Service to transmit Images of items that:

a. are not payable in U.S. currency;

b. are not dated, are post-dated, or are dated more than six (6) months prior to the date of deposit;

c. are not drawn on a financial institution located in the United States;

d. are payable to someone other than you, including jointly-payable checks;

e. are money orders, savings bonds, or traveler’s checks;

f. are checks authorized over the telephone or created remotely, which are sometimes referred to as “remotely created checks” or “telephone checks”;

g. have been previously converted to a substitute check;

h. exceed the limits we have set;

i. have been previously deposited by you or anyone else at any other financial institution or with us (through a mobile check deposit service or otherwise);

j. contain alterations, or which you know or suspect, or should know or suspect, are fraudulent, suspicious, not authorized by the owner of the account on which the check or other item is drawn, or otherwise not likely to be honored;

k. are not legible or do not conform to our image processing standards;

l. are otherwise prohibited by this Spruce Spending Account Agreement or any other Additional Agreement.

3. Image Quality and Specifications. Every Image transmitted using the Mobile Check Deposit Service must be legible and meet our technical requirements as well as the technical requirements of our service providers. We reserve the right to reject any Image for any reason in our sole discretion and without liability.

The information you transmit to us must meet the requirements to create a substitute check under Regulation CC, including all MICR-line information, other applicable Federal Reserve requirements, and any other applicable regulatory, clearing house, or association rules. You are responsible for entering the correct amount of the Deposit Item when making a deposit. Any errors in the information transmitted to us will result in a delay in the processing and availability of the funds and could result in the deposit being rejected.

4. Image Processing. If an Image does not meet our processing requirements, we will typically notify you in the Spruce App and prompt you to re-take front and back photographs of the original Deposit Item. We can also in our discretion: (1) process the Image as received for payment; (2) correct, or attempt to correct, the Image or its accompanying data and process the Image and/or data as corrected for payment; (3) process the Image in another format as allowed; or (4) reject the Image and refuse the deposit or immediately reverse any amount credited to your Spruce Spending Account. You authorize us to process the deposit as a substitute check or any other method that is allowed, including as an ACH entry, or through the Federal Reserve.

When you successfully transmit an Image to us, your deposit will appear as pending in your Spruce Spending Account. This does not mean that the deposit is complete. All Images are subject to our further verification prior to being accepted for deposit and final payment. Do not destroy your Deposit Item except as outlined in this Section. You will generally be notified if a Deposit Item has been rejected. Your deposit is not considered complete until it no longer appears as pending in your Spruce Spending Account.

5. Suspected Errors. If your statement shows any suspected errors regarding checks you deposited using the Mobile Check Deposit Service, tell us at once. If you do not tell us within 60 days after we have made available to you the FIRST statement on which the problem or error appeared, the amount of the deposit on your statement made using the Mobile Check Deposit Service will be deemed correct and you will have no claim against us for any losses related to the deposit. If a good reason (such as a long trip or a hospital stay) kept you from telling us, we will extend the time periods for a reasonable period.

6. Deposit Limits. The maximum amount you may deposit through the Mobile Check Deposit Service is $2,000 per day, or $5,000 in any rolling 30 day period. The maximum number of deposits you may make through the Mobile Check Deposit Service is 7 in any rolling 30 day period. However, we may allow transactions that exceed these deposit limits in our sole discretion, and if we do so, we may increase your deposit limits temporarily without notice. We may also temporarily decrease your deposit limits without notice for security reasons. We reserve the right to modify the limits applicable to the Mobile Check Deposit Service, including the right to impose limits on the number of deposits you transmit using the Mobile Check Deposit Service, from time to time. We will notify you of any changes to your deposit limits to the extent required by law.

7. Endorsements and Retention Requirements. When you use the Mobile Check Deposit Service to transmit an Image of a Deposit Item, you will still have possession of the original Deposit Item. In order to prevent duplicate submission of the original Deposit Item for payment, you must take the following steps: (1) before you transmit the Image to us, you must endorse (i.e. write your signature) on the back of the original Deposit Item or as we otherwise instruct you; (2) once your deposit is complete (i.e. it no longer appears as pending in your Spruce Spending Account), you must write “Void” on the front of the original Deposit Item; (3) you must retain the original Deposit Item for 60 days; and (4) after 60 days, you must destroy the original Deposit Item by shredding it or cutting it up. You are solely responsible for taking these required steps. You also agree that after using the Mobile Check Deposit Service to deposit a Deposit Item, you will not transfer, negotiate, or otherwise attempt to deposit the original Deposit Item, any image of the original Deposit Item, or any related substitute check.

8. Availability of Mobile Deposit Funds. You agree that Deposit Items submitted using the Mobile Check Deposit Service are not subject to the funds availability requirements of Federal Reserve Board Regulation CC. This will be true even if we provide you with Regulation CC disclosures or notices.

Funds from deposits made via the Mobile Check Deposit Service will generally be available for withdrawal within 5 to 7 Business Days after the day of deposit, although we may apply additional delays on the availability of funds based on factors we determine necessary in our sole discretion. We may also choose to make the funds available to you earlier than five days, in our sole discretion.

The cutoff time for deposits made on a Business Day via the Mobile Check Deposit Service is midnight MT. If you successfully transmit an Image to us before midnight MT on a Business Day, we will consider that day to be the day you initiated your deposit. If you transmit an Image to us after midnight MT or on a day we are not open, we will consider the deposit to have been initiated on the next Business Day.

9. Returned Checks or Subject to Refund Claim. In some cases, funds from a deposit made using the Mobile Check Deposit Service will be made available to you sooner than the item can be collected from the paying bank. This means that a Deposit Item submitted via the Mobile Check Deposit Service could be returned unpaid after the funds have been made available to you. Even if a Deposit Item is accepted, we can reverse the amount credited to your Spruce Spending Account for the amount of any Deposit Item that is: (1) returned to us; or (2) is later rejected by us for any reason in our sole discretion. This is true even if you have made withdrawals against the amount credited to your Spruce Spending Account. If this results in a negative balance, then you will be responsible for any negative balance as described in this Spruce Spending Account Agreement.

10. Fees for Mobile Check Deposit. There are currently no fees that we charge to use the Mobile Check Deposit Service. We reserve the right to charge a fee for the use of the Mobile Check Deposit Service in the future, but if we charge a fee, that fee will be disclosed to you prior to your deposit.

ii. Representations and Warranties by User. Each time you submit an Image using the Mobile Check Deposit Service, you represent and warrant to us that all of the following are true:

1. The Image of the Deposit Item you are transmitting meets all of the eligibility requirements set out in this Section;

2. You will follow all other requirements and our instructions for using the Mobile Check Deposit Service;

3. The Image you are transmitting accurately reflects the original Deposit Item;

4. All signatures appearing on the Deposit Item are genuine and were authorized to be made;

5. All of the information you provide to us is true, accurate, and complete;

6. The Deposit Item has not been previously submitted or deposited with us or with anyone else;

7. You will not attempt to deposit the Deposit Item again with us or with anyone else unless instructed to do so by us in writing;

8. After transmission to us, you will not have the Deposit Item stopped or cancelled, or have a replacement issued;

9. The Deposit Item has been written to you, and you are authorized to use the Mobile Check Deposit Service with respect to the Deposit Item;

10. Your Spruce Accounts are in good standing;

11. You have followed all laws, regulations, and terms related to the Mobile Check Deposit Service, including those in this Section and any other agreement that applies to your Spruce Accounts; and

12. You agree to indemnify and hold us harmless from any loss for breach of this warranty provision.

20. Electronic Access and Consent.

a. Electronic Account. Your Spruce Accounts are intended to be electronic-only accounts, and require your consent to receive electronic communications from us. If you do not consent or if you withdraw your consent to electronic communications, we may close your Spruce Accounts and terminate your access to them. Your agreement to accept electronic communications includes delivery of all account communications, including statements, end-of-year tax forms, changes in terms, annual privacy notices, and new and updated account agreements. We reserve the right to send paper documents to your address we have in our records, in our sole discretion. Please note that message and data charges may apply from your wireless service provider when using your Spruce Electronic Account.

b. Contact Information. You agree to provide us with accurate information when opening your Spruce Accounts, including your contact information (e.g., name, physical address, mobile telephone number, email address). If your information changes, you agree to immediately provide us with updated information.

c. Consent to Electronic Communications. By providing us with a telephone number and email address when opening your Spruce Accounts, you expressly agree and consent that we (including Emerald Financial Services or any other service provider) may (i) call and/or text you using an automatic telephone dialing system or otherwise, (ii) leave you voice or prerecorded messages, and (iii) send you texts, emails or other electronic messages, to service your Spruce Accounts or for other informational purposes related to Spruce generally. Message and data rates may apply. You agree to pay any service charges assessed by your service provider for communications between you and us. You agree that we may monitor and/or record telephone calls with you to ensure the quality of customer service or as allowed by law. Text message frequency may vary. Reply “STOP” to opt out or “HELP” for help.

d. Email and Text Delivery. We do not accept any responsibility for email or text communications not received by you, or for any delay in the delivery of these communications. If you make your emails or texts available to someone else, you are responsible for the delivery of any information related to your Spruce Accounts to such individual. For the most up-to-date and accurate information about your Spruce Accounts, please refer to your Spruce Electronic Account.

21. Customer Service Contact Information. You can reach customer service at:

Address:

Emerald Financial Services
Attn: Back Office Operations
PO BOX 30674
Salt Lake City, UT 84130

Website: www.SpruceMoney.com

Mobile App: Spruce App

Phone Number: 855-977-7823

22. Program Manager. You understand and agree that Emerald Financial Services, an H&R Block company, provides program management and other services to Pathward in connection with your Spruce Accounts.

23. Fraud. Your Spruce Accounts are subject to fraud prevention restrictions at any time, with or without notice to you. This may include the suspension of your Card, your ability to access the funds in your Spruce Accounts, or restriction of your ability to access or delay in the performance of one or more of the Services. We may require you to produce documents or other materials evidencing the validity of the activity. We may also temporarily or permanently reduce the limits applicable to, or withdrawals or transfers from, your Spending Account without notice to you, unless required by law. You specifically acknowledge and agree that we may contact you in cases of suspected fraud, including by text message or otherwise. We may also limit the number of Spruce Accounts that you have in our sole discretion and may ultimately close your Spruce Accounts.

24. Dormant Accounts; Escheatment. In our discretion, we may determine your Spending Account is dormant. including if it has not had any activity in 6 months. If we determine your Spending Account is dormant, we may stop posting your account statements in your Spruce Electronic Account and stop sending you certain notices. For security reasons, we may refuse a withdrawal or transfer from your Spending Account we determine is dormant if we cannot reach you in a timely fashion to confirm the transaction’s authorization. Ultimately, we may close your Spending Account if we determine it is dormant. Should your Spending Account have a remaining balance after a certain period of time determined by state law, we may be required to remit the remaining funds to the appropriate state agency.

25. Death or Incapacity. You agree to make arrangements with a designee to notify us promptly if you become legally incapacitated or die. We will continue to accept deposits and process transaction instructions until we know of your death or incapacity and have a reasonable opportunity to act. You agree that even when we have knowledge of your death, we may accept deposits or process transactions on your Spending Account unless ordered to stop by someone claiming an interest in your Spending Account. We may require additional documentation to confirm any claims made on the Spending Account. You may designate a beneficiary on your Spruce Accounts by contacting Customer Service and filling out the required documentation.

26. Returns and Refunds.

a. Merchant Credits. If you are entitled to a refund for any reason for goods or services purchased with your Spending Account, the return and refund will be handled by the merchant. If the merchant credits your Spending Account, you agree to accept such credit and understand that it may not be immediately available. While merchant refunds post as soon as they are received, please note that we have no control over when a merchant sends a credit transaction, and the refund may not be available for a number of days after the date the refund transaction occurs.

b. Merchant Disputes. All disputes regarding purchased goods or services must be addressed and handled directly with the merchant from whom those goods or services were obtained. We are not responsible in any way for any goods or services you decide to purchase, including without limitation, their quality, safety, legality, or delivery. We will not become involved in any dispute involving such goods or services. You also agree to release us and our service providers, including the respective directors, officers, employees, and agents of either, from any and all claims, demands and damages between persons using and accepting the Card associated with your Spending Account, including any claims, demands or damages arising out of or related to the purchase or sale of goods or services.

27. Arbitration if a Dispute Arises (“Arbitration Agreement”).

a. Scope of Arbitration Agreement. You and the Covered Parties agree that all disputes and claims between you and the Covered Parties shall be resolved through binding individual arbitration unless you opt out of this Arbitration Agreement using the process explained below.

i. All issues are for the arbitrator to decide, except that issues relating to the arbitrability of disputes and the validity, enforceability, and scope of this Arbitration Agreement, including the interpretation of and compliance with Sections 27(b), (d), and (f) below, shall be decided by a court and not an arbitrator.

ii. The terms “Covered Parties” or “we” or “us” in this Arbitration Agreement include Pathward, National Association, HRB Digital LLC, and Emerald Financial Services, LLC, along with their predecessors, successors, and assigns, and each of the past, present, and future direct or indirect parents, subsidiaries, affiliates, officers, directors, agents, employees, and franchisees of any of them.

iii. As an alternative to arbitration, you and the Covered Parties agree, to the fullest extent permitted by applicable law, that either party may file and pursue an individual action in an appropriate small claims court, as long as the action is brought and maintained as an individualized claim both in that court and on any appeal to an applicable court, and the relief sought by the claimant at all times falls within the jurisdiction of the small claims court. If the action satisfies the requirements of federal subject-matter jurisdiction, the defendant in the action may remove the action to federal court, and you and the Covered Parties agree that such an action shall then be resolved in arbitration in accordance with this Arbitration Agreement instead of in that federal court.

b. Commencing Arbitration. You or we may commence an arbitration proceeding only if you and we do not reach an agreement to resolve the dispute or claim during the Informal Resolution Period (defined below).

i. Pre-Arbitration Notice of Dispute. A party who intends to seek arbitration must first mail a written Notice of Dispute (“Notice”) to the other party. The Notice to the Covered Parties should be addressed to: EFS-Legal Department, Attention: Notice of Dispute, 1301 Main Street, Kansas City, MO 64105. The Notice to you will be sent to the last known address on file with the Covered Parties. The Notice must be on an individual basis and include all of the following: (1) the claimant’s name, address, telephone number, e-mail address, and last four digits of Social Security Number; (2) the nature or basis of the dispute or claim; (3) the specific relief sought; and (4) the claimant’s signature.

ii. Informal Settlement Conference. After the Notice containing all of the information required above is received, within 60 days either party may request an individualized discussion (by telephone or videoconference) regarding informal resolution of the dispute (“Informal Settlement Conference”). If timely requested, the parties will work together in good faith to select a mutually agreeable time for the Informal Settlement Conference. You and our business representative must both personally participate in a good-faith effort to settle the dispute without the need to proceed with arbitration. The requirement of personal participation in an Informal Settlement Conference may be waived only if both you and we agree in writing. Any counsel representing you or us may also participate; however, if you have retained counsel, federal law and regulations may require a signed consent form from you to authorize certain Covered Parties to disclose your confidential tax and account records to your counsel. Any applicable statute of limitations will be tolled for the claims and relief set forth in the Notice during the period between the date that either you or we send the other a fully complete Notice, until the later of (1) 60 days after receipt of the Notice; or (2) if a Settlement Conference is timely requested, 30 days after completion of the Settlement Conference (the “Informal Resolution Period”). The parties agree that the existence or substance of any settlement discussions are confidential and shall not be disclosed, except as provided by applicable law.

iii. Enforcement of Pre-Arbitration Requirements. The Notice and Informal Settlement Conference requirements are essential so that you and we have a meaningful chance to resolve disputes informally before proceeding to arbitration. A court will have authority to enforce this Section 27(b), including the power to enjoin the filing or prosecution of an arbitration or the assessment of or demand for payment of fees in connection with an arbitration, if the party who intends to seek arbitration does not first provide a fully complete Notice and participate in a timely requested Informal Settlement Conference. In addition, unless prohibited by applicable law, the arbitration administrator shall not accept, assess or demand fees for, or administer an arbitration commenced during the Informal Resolution Period.

c. How Arbitration Works. Arbitration shall be conducted by the American Arbitration Association (“AAA”) pursuant to its then-current Consumer Arbitration Rules and, if applicable, the then-current AAA Mass Arbitration Supplementary Rules (collectively, the “AAA Rules”), as modified by this Arbitration Agreement. The AAA Rules are available on AAA’s website, www.adr.org. The AAA modifies the AAA Rules from time to time. If AAA is unavailable or unwilling to administer the arbitration consistent with this Arbitration Agreement, the parties shall agree to, or the court shall select, another arbitration provider. Unless the parties agree otherwise, any arbitration hearing shall take place in the county of your residence. Except for a ruling on the basis of a dispositive motion, unless the parties agree otherwise, the arbitrator will conduct the arbitration hearing by telephone, videoconference, or in person. The arbitrator will be either a retired judge or an attorney specifically licensed to practice law in the state of your residence and selected by the parties from the arbitration provider’s national roster of arbitrators. The arbitrator will be selected using the following procedure: (1) the arbitration provider will send the parties a list of five candidates meeting this criteria; (2) if the parties cannot agree on an arbitrator from the list, each party shall return its list to the arbitration provider within 10 days, striking up to two candidates, and ranking the remaining candidates in order of preference; (3) the arbitration provider shall appoint as arbitrator the candidate with the highest aggregate ranking; and (4) if for any reason the appointment cannot be made according to this procedure, the arbitration provider will provide the parties a new list of five candidates meeting the above criteria until an appointment can be made. The arbitrator shall have jurisdiction to hear and rule on pre-hearing disputes and is authorized to hold pre-hearing conferences, as well as the arbitration hearing, by telephone, videoconference, or in person. Either party may file a motion to dismiss and/or a motion for summary judgment. The arbitrator shall set a briefing schedule for such motion(s) upon the request of either party. Both parties shall have the right to discovery in support of their claims and defenses. Discovery shall consist of an exchange of all documents and exhibits that the party intends to use at the hearing in support of that party’s claims and defenses, as well as a list of witnesses intended to testify at the hearing, along with the subjects of their anticipated testimony. The arbitrator may allow limited and reasonable additional discovery to the extent the arbitrator deems necessary to provide for a fundamentally fair process, with consideration to the expedited nature of arbitration and the need to ensure that the cost and burden of discovery is commensurate with the amount in controversy. To the extent allowed by applicable law, the arbitrator may impose any sanction available under the AAA Rules, the standards set forth in Federal Rule of Civil Procedure 11, or applicable federal or state law against any appropriate represented party or counsel.

d. Waiver of Right to Bring Class Action and Representative Claims. All arbitrations shall proceed on an individual basis. The arbitrator is empowered to resolve the dispute with the same remedies available in court, including compensatory, statutory, and punitive damages; attorneys’ fees; and declaratory, injunctive, and equitable relief. However, the arbitrator’s rulings or any relief granted must be individualized to you and shall not apply to or affect any other client. The arbitrator is also empowered to resolve the dispute with the same defenses available in court, including but not limited to statutes of limitation. You and the Covered Parties also agree that each may bring claims against the other in arbitration only in your or their respective individual capacities and in so doing you and the Covered Parties hereby waive the right to a trial by jury, to assert or participate in a class action lawsuit or class action arbitration, to assert or participate in a private attorney general lawsuit or private attorney general arbitration, and to assert or participate in any joint or consolidated lawsuit or joint or consolidated arbitration of any kind. If, after exhaustion of all appeals, a court decides that applicable law precludes enforcement of any of this section’s limitations as to a particular claim or any particular request for a remedy for a claim (such as a request for public injunctive relief), then the parties agree that the particular claim or the particular request for a remedy (and only that particular claim or particular request for a remedy) must remain in court and be severed from any arbitration. No arbitration shall proceed in any manner as a class action arbitration, private attorney general arbitration, or arbitration involving joint or consolidated claims, unless all parties consent in writing.

e. Arbitration Fees. Payment of all filing, administrative, case-management, arbitrator, and hearing fees will be governed by AAA Rules, but if you inform us that you cannot afford to pay your share of the fees, we will consider advancing those fees to the AAA on your behalf and will do so if required by applicable law. In addition, we will reimburse you for your share of the fees at the conclusion of the arbitration (regardless of who wins) so long as (i) you complied with the requirements in Sections 27(b) and (d) above and Section 27(f) below, and (ii) neither the substance of your claim nor the relief you sought was determined to violate the standards set forth in Federal Rule of Civil Procedure 11(b); if these conditions are not met, the payment of fees will be governed by AAA Rules and you agree to reimburse the Covered Parties for all fees advanced on your behalf.

f. Arbitration of Similar Claims by Claimants Represented by the Same or Coordinated Counsel. If 25 or more claimants submit Notices or seek to file arbitrations raising similar claims and are represented by the same or coordinated counsel (regardless of whether the cases are submitted simultaneously), the AAA’s then-current Mass Arbitration Supplementary Rules, as modified by this Arbitration Agreement, shall apply, and all of the claims must be resolved in arbitration in stages using staged bellwether proceedings if they are not resolved during the Informal Resolution Period. You agree to this process even though it may delay the arbitration of your claim. You and the Covered Parties each agree to notify the AAA if the conditions for applying the provisions in this Section 27(f) have been satisfied. In the first stage, each side shall select 15 claimants (30 claimants total) whose claims will be filed in arbitration and resolved individually by different arbitrators, with each claimant’s claim assigned to an arbitrator from the claimant’s home state. In the meantime, no other claims may be filed in arbitration, and the AAA shall not accept, assess or demand fees for, or administer arbitrations that are commenced in violation of this section. Unless otherwise agreed by the parties in writing, each claimant whose claim is selected for a bellwether proceeding shall file an arbitration demand within 30 days after being selected. The arbitrators are encouraged to resolve the claims within 120 days of appointment or as swiftly as possible, consistent with principles of fundamental fairness. If the remaining claimants’ claims are unable to be resolved after the conclusion of the first stage bellwether proceeding, the process will be repeated until all claims are resolved through settlement or arbitration, with two alterations. First, each side shall select up to another 50 claimants (100 claimants total). Second, arbitrators who were previously assigned arbitrations may be appointed to new arbitrations to the extent required if the AAA does not have a sufficient number of arbitrators available. If any claims remain after the second stage, the second stage process will be repeated until all claims are resolved through settlement or arbitration, except that a total of 200 claimants may file claims each round (unless a higher number of claimants is mutually agreed upon in writing) and the appointment of the arbitrators shall be governed by the AAA rules rather than Section 27(c) above.

If this Section 27(f) applies to a Notice, the statute of limitations applicable to the claims and relief set forth in that Notice shall be tolled from the beginning date of the Informal Resolution Period until that Notice is selected for a bellwether proceeding, withdrawn, or otherwise resolved. A court will have authority to enforce this Section 27(f), including to enjoin the filing, assessing or demanding fees for, administration of, or prosecution of arbitrations. To the fullest extent permitted by applicable law, if this Section 27(f) applies to a Notice, you and the Covered Parties agree that any of the claimants or the Covered Parties may bring a single court proceeding to enforce the requirements of this Arbitration Agreement, including the interpretation of and compliance with Sections 27(b) and 27(f), as to all of the claims that qualify as similar claims under this Section 27(f).

g. Other Terms. This Arbitration Agreement shall be governed by, and interpreted, construed, and enforced in accordance with, both the procedural and substantive provisions of the Federal Arbitration Act and other applicable federal law. For the avoidance of doubt, the parties agree that the provisions of the California Arbitration Act, including but not limited to California Code of Civil Procedure Sections 1281.2(c), 1281.97, 1281.98, and 1281.99, shall not apply. If the FAA does not apply to a particular dispute or to one or both parties, the parties stipulate and agree that the Delaware Arbitration Act will apply. Except as set forth above in Section 27(d), if any portion of this Arbitration Agreement is deemed invalid or unenforceable, it will not invalidate the remaining portions of the Arbitration Agreement. No arbitration award or decision will have any preclusive effect as to any issues or claims in any dispute, arbitration, or court proceeding where any party was not a named party in the arbitration, unless and except as required by applicable law.  Notwithstanding any provision in this Agreement to the contrary, we will not make any material change to this Arbitration Agreement without providing you with an opportunity to reject the change. Rejection of any future change will not impact this or any prior Arbitration Agreement to which you have agreed.

28. Legal Process. Your Spruce Spending Account is established and maintained at our main office in Sioux Falls, South Dakota. We will comply with all applicable law in connection with any legal process validly served upon us in connection with your account including, but not limited to, garnishments, restraints, seizure notices, subpoenas, and similar legal process. Unless required by applicable state or federal law, we will not assert any claims of exemption on your behalf. You agree that we will have no liability to you in the event we properly comply with any such valid legal process.

29. Disclaimer of Warranties. EXCEPT AS EXPRESSLY OTHERWISE PROVIDED IN THIS SPENDING ACCOUNT AGREEMENT, WE MAKE NO REPRESENTATIONS OR WARRANTIES OF ANY KIND TO YOU, AND HEREBY EXPRESSLY DISCLAIM ALL WARRANTIES, WHETHER EXPRESS OR IMPLIED, REGARDING OUR SERVICES OR ANY FINANCIAL SERVICE OR RELATING TO OR ARISING OUT OF THIS SPENDING ACCOUNT AGREEMENT, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

30. Applicable Law. Except as provided in the Arbitration Agreement, this Spending Account Agreement will be governed by and interpreted and enforced in accordance with federal law; to the extent state law applies and is not preempted by federal law, this Spending Account Agreement will be governed by the laws of the State of South Dakota (without reference to conflict of laws provisions).

31. English Language Controls. Any translation of this Spending Account Agreement is provided for your convenience only and may not accurately represent the original English. The meanings of terms, conditions and representations in this Spending Account Agreement are subject to definitions and interpretations in the English language.

32. Amendment and Cancellation. We may change the terms of this Spending Account Agreement at any time, except as otherwise provided in the Arbitration Agreement. We will notify you of any changes if required by, and in the manner provided by, applicable law.  When we change this Spending Account Agreement, the then-current version will govern your Spending Account. If you continue to use your Spending Account or keep it open, you are deemed to have accepted and agreed to any changes, as of the effective date of any such change. We also may determine your eligibility for certain Services in our sole and absolute discretion. We reserve the right to modify or discontinue the Services at any time to the maximum extent allowable by law.

33. Other Terms. We may transfer or assign all or a portion of any of our rights and obligations to Emerald Financial Services or a third party without your notice or consent, unless required by law. Your rights and obligations may not be assigned. We do not waive our rights by delaying or failing to exercise them at any time. Except as provided in the Arbitration Agreement, if any provision of this Spending Account Agreement is determined to be invalid or unenforceable, the validity or enforceability of any other provision of this Spending Agreement shall not be affected. This Spending Account Agreement (including the Arbitration Agreement) will survive after your Spending Account is closed.