This Agreement describes your rights and obligations as a user of the Online Banking service or the Bill Payment service (“Services”). It also describes the rights and obligations of Catskill Hudson Bank. Please read this Agreement carefully. By requesting and using one of these Services, you agree to comply with the terms and conditions of this Agreement.

Definitions

The following definitions apply in this Agreement:

“Online Banking” is the Internet-based service providing access to your Catskill Hudson Bank account(s); “Online Account” means any Catskill Hudson Bank account from which you will be conducting transactions using a Service; and “Password” is the system-generated code sent to you by Catskill Hudson Bank for use during the initial sign-on, or the codes you select after the initial sign-on, that establishes your connection to the Service. “Time of day” references are to Eastern Standard Time or Eastern Daylight Time, as applicable. “We”, “us” or “Bank” refer to Catskill Hudson Bank, which offers the Services and which holds the accounts accessed by the Services.

Access to Services

Catskill Hudson Bank will provide instructions on how to use the Online Banking service or Bill Payment service. You will gain access to your Online Accounts through the use of your Internet-enabled device, your Internet Service Provider, your login ID and Password.

Use of Your Security Password

You agree not to allow anyone to gain access to the Services or to let anyone know your Password used with the Services. You agree to assume responsibility for all transactions with respect to your online account.

If your Password has been lost or stolen

If your Password has been lost or stolen, call Catskill Hudson Bank immediately at (845) 794-9203, 8:00 a.m. to 5:00 p.m. (Eastern Time), Monday through Friday. After hours, you may call Catskill Hudson Bank at (845) 794-9203. Telephoning Catskill Hudson Bank is the best way of minimizing your losses.

If your statement shows transfers that you did not make

If your statement shows transfers that you did not make, notify Catskill Hudson Bank immediately by calling (845) 794-9203, 8:00 a.m. to 5:00 p.m. (Eastern Time), Monday through Friday or writing Catskill Hudson Bank at:

Catskill Hudson Bank
Operations Department
P.O. Box 855
Rock Hill, NY 12775

You are solely responsible for losses resulting from the unauthorized use of your password and your online account.

Banking Transactions with Online Banking

In addition to viewing account information, you may use Online Banking to conduct the following transactions:

• Transfer funds among your checking accounts, savings account, and money market accounts. NOTE: Because regulations require Catskill Hudson Bank to limit preauthorized transfers (including Online Banking transfers), the following limitations apply:
• Statement Savings Account – You can make no more than six transfers per month by preauthorized or automatic transfer by telephone or Online Banking.
• Money Market Account – You can make no more than six transfers per statement period by preauthorized or automatic transfer by telephone or Online Banking and no more than three of these may be by check, draft or debit card.
• New services may be introduced for Online Banking from time to time. Catskill Hudson Bank will notify you of the existence of these new services. By using these services when they become available, you agree to be bound by the rules, which will be made available to you concerning these services.

Bill Payment Services

The Bill Payment service is provided by Jack Henry & Associates (“JHA”). The Bill Payment service permits you to use your Internet-enable device to direct payments from your designated online Bill Pay Account to third parties you wish to pay. Your Bill Pay Account must be a checking account. You may designate multiple Bill Pay accounts. Through the Bill Payment service, you can pay bills from your Bill Pay Account to businesses or individuals. While Catskill Hudson Bank coordinates the Bill Payment service with JHA, JHA performs all functions in connection with the Bill Payment service. By using the Bill Payment service, you acknowledge and agree that JHA is solely responsible for administration of the Bill Payment service.

All payments you make will be deducted from the account that you designated for that payment. Any payments you wish to make through this service must be payable in U.S. dollars to a payee located in the continental United States. JHA reserves the right to restrict types of payees to whom payments may be made using the service from time to time. You should not use the Bill Payment service to make payments to settle securities purchases, payments to interest bearing accounts, tax payments, or court ordered payments. Payments for these payees will be your sole responsibility if delayed or improperly processed or credited.

Funds must be available in your Bill Pay Account on the scheduled payment date. If the date you schedule a payment to be initiated falls on a non-business day (Saturday, Sunday or holiday), funds must be available in your Bill Pay Account the previous business day (e.g., Friday). After funds are withdrawn from your Bill Pay Account to make a payment, Bill Pay may make the payment either by transferring funds electronically to the payee or by mailing the payee a check.

You may choose to schedule payments to recur in the same amount at regular weekly, bi-weekly, monthly, semi-monthly, quarterly, annual or semi-annual intervals (a “recurring payment”). If a recurring payment is chosen, the bill will be paid automatically each billing period. If the payment is not a recurring payment, it will be a “one-time payment”. One-time payments are not made until you enter the amount of the current bill. You may also change or skip payments that are recurring payments. However, you must allow at least three (3) business days after we receive any change to information you have given us about a payee for JHA to reflect the change in its records.

When you create a new payee in the Bill Payment service, it has a temporary status until JHA has had sufficient time to set up the account, and for your business payees, verify information about your account. You should schedule a payment to a new payee at least ten (10) business days before any payment due date, to allow JHA time to set up the payee and verify information about your account with the payee.

For all subsequent payments, you agree to allow at least five (5) business days between the date you schedule a payment to be initiated and the payment due date (that is, the due date shown on your invoice or provided in your agreement with the payee, not taking into account any applicable grace period). If you do not, you will be fully responsible for all late fees, finance charges or other action taken by the payee. If you schedule your payment and follow all instructions provided, but the payee does not receive the payment in a timely manner, JHA and Catskill Hudson Bank will work with the payee on your behalf to attempt to have any late fees or charges reversed.

JHA and Catskill Hudson Bank are only responsible for exercising ordinary care in processing and sending payments upon your authorization in accordance with this Agreement. JHA and Catskill Hudson Bank will not be liable in any way for damages you incur if you do not have sufficient funds in your Bill Pay Account to make the payment on the processing date, for delays in mail delivery, for changes to the payee’s address or account number unless you have advised us of the change sufficiently in advance, for the failure of any payee to correctly account for or credit the payment in a timely manner, or for any other circumstances beyond the reasonable control of JHA and Catskill Hudson Bank.

Payments made through the Bill Payment service are processed at 3:00 a.m. EST and 1:00 p.m. EST. Payments scheduled before 1:00 p.m. EST are considered effective on that business day. Otherwise, it will be considered received on the following business day. For all entries made using the service, the time recorded by the Online Banking service controls.

If your Bill Pay Account does not have sufficient funds to make a payment as of the date the transfer or payment is attempted or scheduled to be made, the transfer or payment will be attempted until the funds are made available. For recurring payments, the payment will be attempted until the date of the next scheduled payment. In all cases, you are responsible for either making alternate arrangements for the payment or rescheduling the payment through the Service.

Payments must be changed or canceled using the service two business days prior to 1:00 p.m. EST of the scheduled payment date. If you ask us to cancel a payment after it is issued and we agree to do so, we may charge you a stop payment fee. Stop payment orders must be in writing. Stop payment orders will be in effect for a period of six months. After six months, any stop payment order will terminate and must be renewed in order to continue in effect. Catskill Hudson Bank may pay any item that is presented following the lapse of any stop payment order.

Electronic Mail

If you send Catskill Hudson Bank an electronic mail message, Catskill Hudson Bank will be deemed to have received it on the following business day. Catskill Hudson Bank will have a reasonable time to act on your e-mail.

You should not rely on electronic mail if you need to communicate with Catskill Hudson Bank immediately – for example, if you need to report an unauthorized transaction from one of your accounts or if you need to stop a payment that is scheduled to occur.

You agree that Catskill Hudson Bank may respond to you by electronic mail with regard to any matter related to the Service, including responding to any claim of unauthorized electronic funds transfer that you make. Any such electronic mail sent to you by Catskill Hudson Bank shall be considered received within three (3) days of the date sent by Catskill Hudson Bank, regardless of whether or not you sign on to the Service within that time frame.

Other agreements

In addition to this Agreement, you and Catskill Hudson Bank agree to be bound by and comply with the requirements of the agreements applicable to each of your Online Accounts. Your use of the Online Banking service or the Bill Payment service is your acknowledgment that you have received these agreements and intend to be bound by them. You should review other disclosures received by you when you open your accounts at Catskill Hudson Bank including the charges that may be imposed for electronic funds transfers or the right to make transfers listed in the fee schedules accompanying those disclosures and the fee schedule at the end of this Agreement. We will automatically deduct the fees related to this Service from your Bill Pay account each month.

Hours of Operation

The Services are available 24 hours a day, seven days a week, except during special maintenance periods. For purposes of transactions, Catskill Hudson Bank’s business days are Monday through Friday, excluding holidays. All Online Banking transaction requests received after 6:00 p.m. on business days and all transactions, which are requested on Saturdays, Sundays, or holidays on which Catskill Hudson Bank chooses to remain closed, will be processed on the next business day. Catskill Hudson Bank’s business day begins at 8:00 a.m.

Modifications to this Agreement

Catskill Hudson Bank may modify the terms and conditions applicable to either Service from time to time upon mailing or delivering a notice of the modifications to you at the address shown on our account records and the revised terms and conditions shall be effective at the earliest date allowed by applicable law. We may send any notice to you via electronic mail and you will be deemed to have received it three days after it is sent. We reserve the right to terminate this Agreement and your use of the Services in whole or in part at any time without prior notice.

Errors and questions

In case of errors or questions regarding Online Banking or Bill Payment transactions, call Catskill Hudson Bank at (845) 794-9203 or write us at:

Catskill Hudson Bank
Operations Department
P.O. Box 855
Rock Hill, NY 12775

We must hear from you at the specified telephone number or address no later than 60 days after we sent you the FIRST statement on which the problem or error appeared. We will need:

• Your name and account number (if any)
• A description of the error or the transfer in question and an explanation concerning why you believe it is an error or need more information.
• The dollar amount of the suspected error and date on which it occurred.

If the report is made orally, you must send the complaint or question to Catskill Hudson Bank in writing within 10 business days. We will notify you with the results of the investigation within 10 business days after you notified us. If more time is needed, however, we may take up to 45 days to investigate a complaint or question. If this occurs, we will credit your account within 10 business days for the amount you think is in error. This will allow you to use the money during the time it takes us to complete our investigation. If your complaint or question is not received in writing within 10 business days, we may not credit your account until the investigation is complete.

If an alleged error involves an electronic funds transfer outside a state or territory or possession of the United States, the applicable time periods for action by us are 20 business days (instead of 10) and 90 calendar days (instead of 45).

If we determine that no error occurred, we will send you a written explanation within three business days after the investigation is complete, and any credit to your account with respect thereto shall be reversed. You may request copies of the documents that were used in the investigation.

You agree that Catskill Hudson Bank may respond to you by electronic mail with regard to any claim of unauthorized electronic funds transfer related to the Service. Any such electronic mail sent to you by Catskill Hudson Bank shall be considered received within three (3) days of the date sent by Catskill Hudson Bank, regardless of whether or not you sign on to the Service within that time frame.

Statements

You will continue to receive your regular account statement either monthly or quarterly, depending on the type of account.

Our liability for failure to make a transfer

If we do not properly complete a transfer to or from your account on time or in the correct amount according to our Agreement with you, we will be liable for the amount of any actual (but not incidental or consequential) damages incurred by you and resulting directly from such failure. We will not be liable in the following instances:

• If through no fault of Catskill Hudson Bank, you do not have enough money in your account to make the transfer.
• If circumstances beyond our control (such as fire, flood, power outage, equipment or technical failures or breakdown, or the unauthorized actions of a third party) prevent the transfer, despite reasonable precautions that we have taken.
• If there is a hold on your account, or if access to your account is blocked, in accordance with banking policy.
• If your funds are subject to legal process or other encumbrance restricting the transfer.
• If your transfer authorization terminates by operation of law.
• Access of your accounts without your permission.
• You have not properly followed the scheduling instructions on how to make a transfer included in this Agreement.
• If we have received incomplete or inaccurate information from you or a third party involving that account or transfer.
• Failure by JHA to properly complete a bill payment on time or in the correct amount under the Bill Payment service.
• If we have a reasonable basis for believing that unauthorized use of your Password or account has occurred or may be occurring or if you default under this Agreement, the deposit account agreement, a credit agreement, or any other agreement with us, or if we or you terminate this Agreement.

There may be other exceptions stated in this agreement and in other agreements with you. In no event shall we be liable for damages in excess of your actual loss due to our failure to complete a transfer, and we will not be liable for any incidental or consequential damages.

If any of the circumstances listed in subparagraph 2 or 9 above shall occur, we shall assist you with reasonable efforts in taking appropriate corrective action to reprocess the transactions that may not have been completed or to correct incorrect transactions that have been processed.

Disclosure of information to third parties

We will disclose information to third parties about your account or the transfer you make:

• where it is necessary for completing transfer. Or,
• in order to verify the existence and condition of your account for a third party, such as a credit bureau or merchant. Or,
• in order to comply with government or court orders, or other reporting requirements. Or,
• if you give us your written permission. Or,
• as required or allowed by law.

More information regarding disclosure of information to third parties is contained in the Catskill Hudson Bank Online Banking Privacy Policy and Catskill Hudson Bank’s Notice of Your Privacy Rights.

Inactivity; Termination

You are responsible for complying with all the terms of this Agreement and with the terms of the agreement governing the deposit accounts which you access using electronic banking services. We can terminate your electronic banking privileges (including Bill Payment service) under this Agreement without notice to you if you do not pay any fee required by this Agreement when due, or if you do not comply with the agreement governing your deposit or loan accounts, or your accounts are not maintained in good standing, or for any other reason or no reason at the discretion of Catskill Hudson Bank. We will promptly notify you if we terminate this Agreement or your use of the services for any other reason.

Unless you are paying a monthly service charge to the Bank for the Service, we may convert your account to inactive status if you do not sign on to the Service or have any transaction scheduled through the Service during any consecutive 180-day period. If your account is considered inactive, you must contact us to have the Service activated before you will be able to schedule any transaction through the Service.

To cancel Online Banking and/or Bill Payment service, you must notify Catskill Hudson Bank and provide your name; address; whether you are discontinuing Online Banking, Bill Payment or both; and the effective date to stop the service. When Bill Payment is terminated, any prescheduled bill payments made through Online Banking will also be terminated. Your final charge for the Bill Payment Service will be assessed at the end of your statement cycle. You may notify Catskill Hudson Bank by one of the following methods:

• By sending an e-mail to chb@catskillhudsonbank.com
• By calling (845) 794-9203, 8:00 a.m. to 5:00 p.m. (Eastern Time), Monday through Friday
• By writing a letter and either sending it to the following address or giving it to a Personal Banker at any Catskill Hudson Bank location:

Catskill Hudson Bank
Operations Department
P.O. Box 855
Rock Hill, NY 12775

Governing Law

This Agreement is governed by the laws of the State of New York and applicable federal law.

Fee Schedule

Please refer to the fee schedule for Online Banking and Bill Payment services prices. Fees for Online Banking and Bill Payment services are subject to change.