Internet Banking Disclosure

You MUST read through this agreement and accept it by clicking at the end before you can access Silver Falls Bank Internet Banking.

Internet Banking Terms and Conditions
Internet Banking Agreement and Disclosure
March 2005

Silver Falls Bank may amend these terms from time to time. If there are any amendments made to the Terms and Conditions it will be reflected on the current date of the agreement. Whenever you use Internet Banking, or authorize others to use it, you agree to these terms. If you have any questions please contact us.

TABLE OF CONTENTS

• What this aqreement covers
• Definition of Terms

INTERNET BANKING SERVICE

• Business Account Authorized Signer
• Requirements for Internet Banking
• Account Access
• Types of Transactions
• Service Limitations
• Transfers
   - Account Information
   - E-Mail
   - Bill Payments

BILL PAYMENT SERVICE

• Bill Payments
• Payment Policy
• Scheduling Payments
• Stop or Change Payments

GENERAL PROVISIONS

• Security of Access Code
• Consumer Liability for Electronic Unauthorized Access
• Business Liability for Electronic Unauthorized Access
• Business Days
• Fees and Charges
• Periodic Statements
• Financial Institution's Liability for Failure to Make Transfers
• Termination of Internet Banking Service
• Change in Terms and Notices
• Billing Errors
• Assignment
• Enforcement
• Governing Law
• Termination
• Communications

WHAT THIS AGREEMENT COVERS

DEFINITION OF TERMS

The words "we" and "our" mean the Financial Institution. In this Agreement, the words "you", "your" and "yours" mean those who request and use Internet Banking, any joint owners of accounts accessed under this Agreement or any person authorized by you to use your Internet Banking service.

"Account" means any one or more deposit accounts that you have with us including checking, savings, time deposit, or money market accounts. An Account may be owned by a consumer or business entity.

"Consumer Account" means an account owned by an individual that is held or maintained primarily for personal, family or household purposes. These Terms and Conditions govern Internet Banking Access to your Account except as otherwise noted below.

"Business Account" means an account that is not held or maintained primarily for personal, family or household purposes. Examples of business accounts include an account that is owned by an individual acting as a sole proprietor, a partnership, a limited partnership, a limited liability partnership, a limited liability company, a corporation, a joint venture, a non-profit partnership, an employee benefit plan or a governmental unit including an Indian tribal entity. These Terms and Conditions govern Internet Banking Access to your Account except as otherwise noted below.

INTERNET BANKING SERVICE

The Internet Banking service permits you to electronically initiate account transactions involving your accounts and communicate with the Institution. By using the Internet Banking service, each of you, jointly and severally, agree to the terms and conditions in this Agreement, and any amendments.

The Terms and Conditions are in addition to the terms of any Account agreements you have with us, including the Account Agreement, Signature Card, Rate and Fee Schedule, Funds Availability Disclosure, Resolution authorizing the use of the Account, and any change of terms or notices.

SILVER FALLS BANK INTERNET BANKING AGREEMENT AND DISCLOSURE

Business Account Authorized Signer.
An "Authorized Signer" is a person whom you authorize to transact business on your account by delivering to the Institution a written document that is acceptable to the Institution and that shows the person has the authority to act with respect to the Business Account.

The Institution may continue to recognize the authority of an Authorized Signer until the Institution has received and had a reasonable time to act upon written notice from you that an Authorized Signer is no longer authorized to transact business on your account. You agree to provide the Institution with documentation acceptable to the Institution designating each authorized signer with respect to your account(s) and related services offered by the Institution.

Requirements for Internet Banking.

Account Access.
If we approve your application for the Internet Banking service, you may use your Computer to access your account. There is no limit to the number of accounts you will be able to access using the Internet Banking service. You will use your Access Code (your account number for your first time login) along with a password to access your account. Any person having access to your Internet Banking Access Code and password will be able to access your accounts through the Internet Banking service and perform all transactions, including reviewing account information and making transfers to other accounts and to other persons.

The Internet Banking service is accessible seven (7) days a week, twenty-four (24) hours a day, except for reasonable periods from time to time for system maintenance. There may also be unscheduled down time, but we will work to minimize such interruptions in Service. You agree that we are not liable for scheduled or unscheduled interruptions regarding the Internet Banking service.

In addition to the reasons set forth below, we may modify, suspend, or terminate access to your Internet Banking service at any time and for any reason without notice or refund of fees you've paid.

Types of Transactions.
At the present time, you may use the Internet Banking service to access your accounts and perform the following functions:

• Transfer funds between certain bank accounts.
• Review account balance and transaction history for certain bank accounts.
• Download your account information to financial management software programs like: 2004 or earlier versions of Quicken®, Microsoft® Money, Microsoft® Excel or IBM Lotus.
• Make bill payments to an individual or business (payee), review bill payment history and make scheduled bill payment changes.
• Communicate with us via our E-mail address: info@silverfallsbank.net.
• Transactions involving a line of credit account will be subject to your loan agreement and disclosures, as applicable.

Service Limitations.
The following limitations on Internet Banking service transactions may apply in using the services listed above:

Transfers.
If your Account is a savings or money market deposit account, federal law requires that an Account Holder may make no more than six (6) transfers and/or withdrawals during any one (1) calendar month or statement cycle (the period from one statement to the next) or similar period of at least four weeks, to another of your accounts with us or to a third party by means of a preauthorized or automatic transfer, or telephonic (including data transmission) agreement, order or instruction.

No more than three (3) of the six (6) transfers may be made by check, draft, debit card, Internet bill payment instruction, or similar order made by you and payable to third parties. If you exceed more than three (3) such transfers, we need not honor the item. A "preauthorized transfer" includes any arrangement by us to pay a third party from your account upon written or oral instruction (including an order received through an automated clearing house (ACH) or any arrangement by us to pay a third party from your account at a predetermined time or on a fixed schedule).

In accordance with federal law, if you have more than the allowable preauthorized transfers or preauthorized checks or drafts (for money market accounts) in any one period, your Account may be subject to closure by us and the funds placed in another account that you are eligible to maintain, or we may take away the transfer and draft capabilities of the account. In addition to the above-preauthorized transfers, you may make unlimited withdrawals (Payments directly to you or transfers of funds from your Account to any of your other deposit accounts or loan accounts with us), either in person at our locations, by mail, messenger, telephone (via check mailed to you), or use of an ATM card (if applicable).

Federal regulations require us to retain the right to require you to give at least seven (7) days notice in writing prior to any intended withdrawal from a savings, negotiable order of withdrawal ("NOW"), or money market account. Although we usually pay withdrawals or checks without notice on these accounts, doing so does not mean that we give up this right.

You may transfer or withdraw up to the available balance in your account or up to the available credit limit on a line of credit at the time of the transfer, except as limited under this Agreement or your deposit or loan agreements.

No transfer may be made from an account that requires two or more signatures. We reserve the right to refuse any transaction that would draw upon insufficient or unavailable funds, lower an account below a required balance, or otherwise require us to increase our required reserve on the account.


a. Account Information. The account balance and transaction history information may be limited to recent account information involving your accounts. Also, the availability of funds for transfer or withdrawal may be limited due to the processing time for ATM transactions and our Funds Availability Policy.

b. E-mail. We may not immediately receive E-mail communications that you send and we will not take action based on E-mail requests until we actually receive your message and have a reasonable opportunity to act. If you need to contact us immediately regarding an unauthorized transaction or stop payment request, you may call us at the telephone number set forth in the Liability for Unauthorized Access section.

c. Bill Payments. When you sign up for the bill payment service you will need to designate a checking account with us as your bill payment account. You may authorize new payment instructions or edit previously authorized payment instructions for bill payments that are either periodic and nonrecurring (i.e. payments on merchant charge accounts that vary in amount) ("periodic bill payments") or automatic and recurring (i.e. fixed monthly mortgage payments) ("automatic bill payments"). You will need to provide us with the name and address of the payee (i.e. the person you want to pay), your account number with the payee and any other information we require to properly debit your account with us and credit your account with the payee. You can only pay payees with United States addresses. We reserve the right to refuse to make payments to certain persons.

Please review the following restrictions: 1) The payee must be located in the United States; 2) Payments may not be remitted to tax authorities or government and collection agencies; 3) Payments may not be remitted to Securities Companies such as Ameritrade for stock purchases or trade taxing authorities and 4) Court directed payments are unauthorized (alimony, child support or other legal debts). If the designated payment day falls on a weekend or holiday, it will be paid on the next business day.

Bill Payments.
When you transmit a bill payment instruction to us, you authorize us to transfer funds to make the bill payment transaction from the account you designate. We will process bill payment transfer requests only to those payees designated in the User Instructions and such payees as you authorize and for whom we have the proper vendor code number. We will not process any bill payment transfer if the required transaction information is incomplete. Please allow three (3) business days for processing any new or changed bill payment instruction.

Payment Policy.
If there are insufficient funds in your account to make the bill payment request, we may either refuse to make the payment, make the payment and transfer funds from any overdraft protection account you have established, or make the transfer or payment and overdraw your account.

If there are available funds to cover some, but not all, of the bill payment requests, we may process the bill payment requests for which there are sufficient available funds in any order we may choose at our sole discretion. In accord with your deposit account agreement, you are responsible for any non-sufficient funds ("NSF") and overdraft charges that may apply. We reserve the right to refuse to process payment instructions that reasonably appear to us to be fraudulent or erroneous.

We will withdraw the designated funds from your account for the bill payment transfer by midnight on the date you schedule for payment. We will process your bill payment transfer within four (4) business days of the date you schedule for payment.

Scheduling Payments.
It is your responsibility to schedule your bill payments in such a manner that your obligations will be paid on time. You should enter and transmit your bill payment instructions through Internet Banking at least 7 (seven) days before the payment due date. You are responsible for any late payments or finance charges that may be imposed as a result of your failure to transmit a timely bill payment authorization. We give payments made through the Internet Banking service a confirmation number. The stop payment terms found in the deposit account agreement are not applicable to Internet transactions. If the payment you wish to stop is made by paper check and we have already paid the check, it is not possible to stop payment. If we have not already paid a paper check, it may be possible to stop payment. In these situations, you must comply with the stop payment terms found in the deposit account agreement.

Stop or Change Payments.
You may cancel or edit a bill payment instruction under certain circumstances. If you discover an error or want to change a payment instruction (i.e. payment date or payment amount) for a periodic or automatic bill payment you have already scheduled for transmission through the Internet Banking service, you may electronically edit or cancel your payment request through the Internet Banking service. Your cancellation request must be entered and transmitted through the Internet Banking service at least three (3) business days before the date the transaction is scheduled to be processed. If we don't receive your instruction to edit or cancel a payment instruction before that time, we may process the transaction. If your request is not entered in a timely manner, you will be responsible for the payment.

You may cancel an automatic recurring (preauthorized debit) payment either orally or in writing. We must receive your oral or written cancellation or amendment request at least three (3) business days before the next payment is scheduled to be made. You may call us at the telephone number set forth in the Liability for Unauthorized Access section to make an oral request. You may write to us at Silver Falls Bank, P. 0. Box 99, Silverton, OR 97381. If you call, we may require you to confirm your stop payment request in writing within fourteen (14) days after the call. We may charge a fee for each request. If you place an oral or written cancellation or amendment to an automatic (preauthorized) bill payment transaction at least three (3) business days before the payment is scheduled, and we fail to stop the payment, we will be liable for your actual losses or damages. We are not responsible if you fail to describe the payment exactly.

GENERAL PROVISIONS

Security of Access Code.
The personal identification number, PIN, ("Access Code") issued to you is for your security purposes. The access code is confidential and should not be disclosed to third parties or recorded. You are responsible for safekeeping your Access Code. You agree not to disclose or otherwise make your Access Code available to anyone not authorized to sign on your accounts. If you authorize anyone to use your Access Code that authority shall continue until you specifically revoke such authority by notifying us. If you fail to maintain the security of your PIN (Access Code) and we suffer a loss, we may terminate your Internet Banking and account services immediately.

You are responsible for all transfers and bill payments you authorize under this Agreement. If you permit other persons to use the Internet Banking service or your access code, you are responsible for any transactions they authorize or conduct involving any of your accounts.

Consumer Liability for Electronic Unauthorized Access.
Tell us IMMEDIATELY if you believe your PIN (Access Code) has been lost or stolen. Telephoning is the best way of keeping your possible losses down. You could lose all the money in your account (plus your maximum overdraft line of credit). If you tell us within two (2) business days, you can lose no more than $50.00 if someone used your Access Code without your permission. If you do NOT tell us within two (2) business days after you learn of the loss or theft of your code, and we can prove that we could have stopped someone from using your code without your permission if you had told us, you could lose as much as $500.00. Also, if your statement shows transfers that you did not make, tell us at once.

If you do not tell us within sixty (60) days after the statement was mailed to you, you may not get back any money lost after the sixty (60) days if we can prove that we could have stopped someone from taking the money if you had told us in time. If a good reason (such as a long trip or a hospital stay) kept you from telling us, we will extend the time periods. If you believe that your Access Code has been lost or stolen or that someone has transferred or may transfer money from your account without your permission, call us at (503) 874-8808.

Business Liability for Electronic Unauthorized Access.
Tell us IMMEDIATELY if you believe your PIN (Access Code) has been lost or stolen or if your statement shows transfers that you did not make. Telephoning is the best way of keeping your possible losses down. You must tell us of any unauthorized electronic transaction within fourteen (14) days after the statement showing the unauthorized electronic transaction was mailed to you. If you do not tell us within that time period, you will be deemed to have authorized the electronic transaction and you may not get back any money lost or fees incurred. If you believe that your Access Code has been lost or stolen or that someone has transferred or may transfer money from your account without your permission, call us at (503) 874-8808.
After we receive notification from you, we will investigate any alleged unauthorized electronic transaction. When our investigation is complete, we will notify you of our findings and the action (if any) we will take. If we determine that there was no error on our part or that you authorized the disputed charge (s), we will explain that determination.

Business Days.
The Institution's business days are Monday through Friday except Holidays.

Fees and Charges.
We do not charge for Internet Banking services, including Bill Pay services. Stop payment charges are shown on our Rate and Fee Schedule which was provided to you at account opening. From time to time, the charges may be changed. We will notify you of any changes as required by law. If you request a transfer or check withdrawal from your line of credit account, such transactions may be subject to charges under the terms and conditions of your loan agreement.

Periodic Statements.
Transfers, withdrawals, and bill payments transacted through Internet Banking will be recorded on your periodic statement. You will receive a statement monthly unless there is no transaction in a particular month. In any case, you will receive a statement at least quarterly.

Financial Institution's Liability for Failure to Make Transfers.
If we do not complete a transfer to or from your account on time or in the correct amount according to our agreement with you and the instructions you transmit, we will be liable for your actual losses or damages. However, we will not be liable:

If, through no fault of ours, you do not have adequate funds in your account to complete a transaction, your account is closed, or the transaction amount would exceed your credit limit on your line of credit, if applicable.

If you used the wrong Access Code or you have not properly followed any applicable computer, internet access, or our user instructions for making transfer and bill payment transactions.

If your Computer fails or malfunctions or the Internet Banking service was not properly working and such problem should have been apparent when you attempted such transaction.

If circumstances beyond our control (such as fire, flood, telecommunication outages, postal strikes, equipment, or power failure) prevent making the transaction.

If the funds in your account are subject to an administrative hold, legal process or other claim.

If you have not given us complete, correct and current instructions so the Institution can process a transfer or bill payment.

If the error was caused by a system beyond our control, such as your Internet Service Provider.

If you do not authorize a bill payment soon enough for your payment to be made and properly credited by the payee by the time it is due.

If we make a timely bill payment but the payee nevertheless does not credit your payment promptly after receipt.

If there are other exceptions as established by us from time to time.


Termination of Internet Banking Services.
You agree that we may terminate this Agreement and your use of the Internet Banking services if you or any authorized user of your account or Access Code breaches this or any other agreement with us; or if we have reason to believe that there has been an unauthorized use of your account or Access Code.

You or any other party to your account can terminate this Agreement by notifying us in writing. Termination of service will be effective the first business day following receipt of your written notice. However, termination of this Agreement will not affect the rights and responsibilities of the parties under this Agreement for transactions initiated before termination. If you terminate, you authorize to continue making transfers and bill payments you have previously authorized until such time as we have had a reasonable opportunity to act upon your notice of termination. If we terminate this service, we reserve the right to make no further transfers or bill payments you have authorized.

Change in Terms and Notices.
We reserve the right to change the terms and conditions upon which this service is offered. We may add, delete or amend terms, conditions and other provisions, fees, charges, or other terms described in this Agreement. We will send you a notice to the postal address provided by you and/or send notice to your E-mail address, as requested by you, at least twenty one (21) days before the effective date of any change, as required by law. Use of the Internet Banking service is subject to existing terms and regulations governing your accounts and any future changes to those terms or regulations.

Billing Errors.
In case of errors or questions about your Internet Banking transactions, telephone us at the phone number or write to us at the address set forth above in the Liability for Unauthorized Access section as soon as you can.

We would like to hear from you no later than sixty (60) days after we sent the FIRST statement on which the problem or error appears:

If you tell us orally, we may require that you send us your complaint or question in writing within ten (10) calendar days. We will determine whether an error occurred within ten (10) business days after we hear from you and we will correct any error promptly. If we need more time, however; we may take up to forty-five (45) days to investigate your complaint or question. If we decide to do this, we will credit your account within ten (10) business days for the amount you think is in error, so that you will have the use of the funds during the time it takes us to complete our investigation. If we ask you to put your complaint or question in writing and we do not receive it within ten (10) business days, we may not credit your account.

We will tell you the results within three (3) business days after completing our investigation. If we decide that there was no error, we will send you a written explanation. You may ask for copies of the documents that we used in our investigation.

If a notice of error involves an electronic fund transfer that occurred within thirty (30) days after the first deposit to the account was made, the applicable time periods for action shall be twenty (20) business days in place of ten (10) business days. If a notice of error involves an electronic fund transfer that was initiated in a foreign country or occurred within thirty (30) days after the first deposit to the account was made, the applicable time period for action shall be ninety (90) calendar days in place of forty five (45) calendar days,

Assignment.
We reserve the right to assign our rights and delegate our duties under this Agreement to a company affiliated with us or any other company.


Enforcement.
You agree to be liable to us for any liability, loss, or expense as provided in this Agreement that we incur as a result of any dispute involving your accounts or services. You authorize us to deduct any such liability, loss, or expense from your account without prior notice to you. In the event either party brings a legal action to enforce the Agreement or collect any overdrawn funds on accounts accessed under this Agreement, the prevailing party shall be entitled, subject to applicable law, to payment by the other party of its reasonable attorney's fees and costs, including fees on any appeal, bankruptcy proceedings, and any post-judgment collection actions, if applicable.


Governing Law.
This Agreement shall be governed by and construed in accordance with all applicable federal laws and all applicable substantive laws of the State of Oregon. In addition, we are subject to certain federal and state regulations and local clearinghouse rules governing the subject matter of the Agreement. You understand that we must comply with these laws, regulations, and rules. You agree that if there is any inconsistency between the terms of the Agreement and any applicable law, regulation, or rule, the terms of the Agreement will prevail to the extent any such law, regulation, or rule may be modified by agreement.


Termination.
You may cancel your Internet Banking Service at any time by providing us with written notice by postal mail or fax. Your access to service will be suspended within 3 business days of our receipt of your instructions to cancel the service. You will remain responsible for all outstanding fees and charges incurred prior to the date of cancellation.

You agree that we can terminate or limit your access to the Internet Banking Services for any of the following reasons:

Without prior notice, if you have insufficient funds in any one of your Accounts. System service may be reinstated, in our sole discretion, once sufficient funds are available to cover any fees, pending transfers, and debits.

Upon 3 business days notice, if you do not contact us to designate a new Primary Checking Account immediately after you close your Primary Checking Account.

Upon reasonable notice, for any other reason in our sole discretion.


Communications.
Communications between you and us. Unless this Agreement provides otherwise, you can communicate with us in any one of the following ways:

Postal Mail:
Silver Falls Bank
P.O. Box 99
Silverton, Oregon 97381
Internet Banking E-mail: info@silverfallsbank.net
Telephone: (503) 874-8808
Facsimile: (503) 874-8818

In person:
You may visit us in person at any one of our locations:

Silverton Branch 217 E. Main St., Silverton, Oregon 97381
Oregon City Branch 19245 South Molalla Avenue, Oregon City OR 97045

Consent to Electronic Delivery of Notices: You agree that any notice or other type of communication provided to you pursuant to the terms of this Agreement, and any future disclosures required by law, including electronic fund transfer disclosures, may be made electronically by posting the notice on the Internet Banking Service, web site, or by E-mail to you. You agree to notify us immediately of any change in your E-mail address.

Yes, I want to enroll, and I agree to the above terms and conditions.

No, I am not interested.