AS OTHERWISE SPECIFICALLY PROVIDED IN THESE PROCEDURES OR IN THE LOCKBOX AND
COLLECTION ACCOUNT AGREEMENT SIGNED BY LENDER (THE "AGREEMENT"), OR AS
SPECIFICALLY REQUESTED BY LENDER AND AGREED TO BY REGULUS, REGULUS WILL NOT
RECONCILE THE CHECKS, CASH OR OTHER ITEMS IN THE ENVELOPES TO INVOICES, TO
REMITTANCE STATEMENTS OR TO ANY OTHER DOCUMENTS OR PAPERS IN THE ENVELOPES OR
ELSEWHERE.
AFTER INSPECTION, REGULUS WILL PROCESS THE CHECKS AND ANY CASH IN
THE ENVELOPES AS PROVIDED IN THIS SECTION 1 AND IN SECTION 2 OF THESE PROCEDURES
AND, IF PROVIDED IN THIS SECTION 1 OR SECTION 2, DEPOSIT SUCH CHECKS AND CASH IN
THE LENDER ACCOUNT.
(A)
CHECKS NOT TO BE DEPOSITED.
UNLESS OTHERWISE REQUESTED BY LENDER
AND AGREED TO BY REGULUS, REGULUS WILL NOT DEPOSIT CHECKS FALLING INTO ANY OF
THE FOLLOWING FIVE CATE­GO­RIES OR CHECKS WHICH LENDER HAS SPECIFICALLY
INSTRUCTED REGULUS IN WRITING NOT TO DEPOSIT:
(I)
UNACCEPTABLE PAYEES.
CHECKS WHERE THE NAME OR DESIGNATION OF THE
PAYEE ON THE CHECK IS NOT THE NAME OR DESIGNATION SPECIFIED AS PROVIDED IN THESE
PROCEDURES BY LENDER IN WRITING TO REGULUS FOR ACCEPTABLE PAYEES OR A REASONABLE
VARIATION OF SUCH NAME OR DESIGNATION.
(II)
POSTDATED AND STALEDATED CHECKS.
CHECKS WHICH ARE POSTDATED
THREE OR MORE DAYS AFTER THE DATE THEY ARE COLLECTED FROM THE LOCKBOX, POSTDATED
CHECKS THAT WOULD NOT BE PAID ON PRESENTATION, AND CHECKS DATED SIX MONTHS OR
MORE PRIOR TO THE DATE THEY ARE COLLECTED FROM THE LOCKBOX.
(III)
INDETERMINABLE AMOUNT.
CHECKS WHERE THE CORRECT AMOUNT OF THE
CHECK CANNOT BE DETERMINED FROM THE CHECK AND THE DOCUMENTS ACCOMPANYING THE
CHECK OR WHERE THE NUMERICAL AND WRITTEN AMOUNTS OF THE CHECK ARE NOT THE SAME
AND THE ENVELOPE CONTAINING THE CHECK DID NOT CONTAIN AN INVOICE
OR A REMITTANCE STATEMENT OR, IF SUCH WERE INCLUDED, THE AMOUNT OF SUCH INVOICE
OR REMITTANCE STATEMENT DID NOT MATCH EITHER THE NUMERICAL OR WRITTEN AMOUNT ON
THE CHECK.
(IV)
UNIDENTIFIED DRAWER.
CHECKS WHICH DO NOT BEAR THE DRAWER'S
SIGNATURE.
(V)
ALTERATIONS.
CHECKS WITH ALTERATIONS; PROVIDED, HOWEVER, THAT
REGULUS CAN ONLY USE ITS BEST EFFORTS TO CATCH SUCH ALTERATIONS AND PREVENT
DEPOSITS.
AS A RESULT, REGULUS WILL HAVE NO LIABILITY WHATSOEVER, DESPITE
ANYTHING TO THE CONTRARY IN THE AGREEMENT, FOR ITS DEPOSIT OF ANY CHECK
CONTAINING AN ALTERATION, UNLESS SUCH DEPOSIT RESULTS DIRECTLY FROM THE WILLFUL
MISCONDUCT OF REGULUS' OFFICERS OR EMPLOYEES.
(B)
CHECKS TO BE DEPOSITED.
UNLESS LENDER SPECIFIES OTHERWISE IN
WRITING TO REGULUS, CHECKS WHICH DO NOT FALL INTO ONE OF THE FIVE CATEGORIES
LISTED IN SECTION 1(A) ABOVE WILL BE DEPOSITED AS PROVIDED IN SECTION 2 BELOW IN
THE LENDER ACCOUNT, AND CHECKS FALLING INTO EITHER OF THE FOLLOWING TWO
CATEGORIES WILL BE DEPOSITED IN THE LENDER ACCOUNT AFTER BEING PROCESSED AS
PROVIDED BELOW, UNLESS THEY ALSO FALL INTO ONE OF THE FIVE CATEGORIES LISTED IN
SECTION 1(A) ABOVE, IN WHICH CASE THEY WILL NOT BE DEPOSITED.
(I)
DISCREPANCIES IN AMOUNT.
CHECKS WHERE THE NUMERICAL AND WRITTEN
AMOUNTS OF THE CHECK ARE NOT THE SAME, IN WHICH