This disclosure contains detailed information pertaining to the terms and conditions of your LA JOLLA BANK accounts. (Hereinafter referred to as "La Jolla Bank" or "Bank").

When you sign your new account signature card, you agree to the terms and conditions described in this disclosure, so it is important that you understand them. Bank reserves the right to change the terms and conditions of your account, this Deposit Account Agreement and Disclosure at any time and from time to time. Bank will give you advance notice of the change when it is required to do so by applicable law. You agree and acknowledge that your continued use of your account after the change constitutes your agreement to the change.

Deposits are insured up to $100,000 by the FDIC, an agency of the U.S. Government. Your investments may be protected even if your deposits total more than $100,000. Please refer to the FDIC information brochures or consult with your attorney.

When you open an account with La Jolla Bank, you will benefit from our strength and stability. We continue to exceed capital requirements and we know how important that is to you as a depositor. We follow conservative investment guidelines with our main focus on real estate and construction lending.

At any time should you have questions or concerns regarding your accounts held at La Jolla Bank or wish to obtain current interest rates and Annual Percentage Yields (for maturing CD's, rates and APY's will be available on your maturity date), please e-mail us or dial toll free 800-333-1909 or contact your local branch office at the number listed below.

Friendly and efficient customer service is our specialty and we thank you for banking at La Jolla Bank. We look forward to the opportunity to fulfill all your financial needs.

La Jolla - (858) 454-8800
Rancho Santa Fe - (858) 756-1501
Indian Wells - (760) 341-5652
Mission Viejo - (949) 454 4100
Escondido - (760) 432-0900
Beverly Hills - (310) 281-0077
Dallas - (214) 528-1177
La Quinta - (760) 771-3498
Palm Desert - (760) 340-6400
Newport Beach - (949) 640-8811

LA JOLLA LINK
24 hour telephone Banking
Toll Free (877) 824-6019

NO SURCHARGE ATM'S
For locations, dial toll free (888) 748-3266

E-Mail Address lajolla@ljbank.com
Web Address www.ljbank.com

La Jolla Bank
(800) 333-1909 or
(858) 454-8800

Important Account Information


Postdated Checks/Stop Payments on Checks
We may charge your account for an item that is otherwise properly payable from the account even though this results in paying the check before the date on it, unless you give us a special "notice of postdated check."

You can give this special notice to us orally, but it must be received by us so as to give us a reasonable opportunity to act on it before final payment of the item. In placing your notice of postdated check, you must describe the check by giving the date, the check number, the exact amount of the check and the name of the payee in order for us to return the item if it is presented for payment before the date on the check.

We require that you put any oral notice of postdated check in writing and deliver it to us within 14 days. We have a special form for this purpose. If you do not put your notice in writing, then your notice of postdated check will expire at the end of the 14-day period. If you put your notice in writing to us, then your notice of postdated check will remain in effect for a total of six months. If you want to continue your notice of postdated check for additional six-month periods, then you must renew your notice before the current notice expires. We impose a fee for each notice of postdated check and each renewal.

We may pay the item as of its date, even if you have given us a notice of postdated check. If you do not want the item to be payable as of its date, you must give us a stop payment order. The notice of postdated check is not the same as a stop payment order. For a stop payment order to be effective, we must receive it in time for us to act on it before the date of the item and the other requirements relating to stop payment, as described on the stop payment order must be followed by you.

Cashier's Checks
You do not automatically have the right to stop payment on cashier's checks you purchase from us. In the event that a cashier's check is lost or destroyed, please contact us for the procedures to follow to obtain reimbursement or have the cashier's check reissued. In general, you will have to complete a Declaration of Loss form, describing the cashier's check and how it came to be lost, stolen or destroyed, and sign the Declaration of Loss under penalty of perjury. We must then wait 90 days from the date the check was issued before we can pay your claim. If 90 days has already passed, then we will act on your claim within a reasonable time. If the check is presented during the 90-day waiting period, we may pay the item to a person entitled to enforce the check. If this happens, we will not pay your claim.

Demand Drafts
If you use or authorize another to issue a demand draft against your account, or voluntarily give information about your account (such as our routing number and your account number) to a party who is seeking to sell you goods or services, and you don't deliver the check physically signed by you to the party, any demand draft or other debit to your account initiated by the party to whom you gave the information is deemed authorized even if it differs in amount, frequency or timing from your intentions or agreement with that party. You agree that you will not hold us responsible for any loss, damage or other problems resulting from your having used or authorized another to create a demand draft.

Attorney Fees
You agree to be liable to us, to the extent permitted by law, for any loss, costs, or expenses that we may incur as a result of any dispute or legal proceeding involving your Account. You authorize us to deduct any such loss, cost, or expenses from your Account without prior notice to you or to bill you separately. This obligation includes disputes between you and us involving your Account in situations where we become involved in disputes between you and an authorized signer, a joint owner, or a third party claiming an interest in your Account. It also includes situations where any action taken on your Account by you, an authorized signer, a joint owner, or third party causes us to seek the advice of an attorney, whether or not we actually become involved in a dispute.

Joint Liability for Overdrafts
If your account is a joint account, any one of the account holders may, without notice to the other account holders, initiate withdrawals or close the account, and, in the case of checking accounts, write checks against the account or request stop payments.

Each joint account holder is jointly and severally liable to us for any and all overdrafts to the account. We are not obligated to honor any transaction that would result in an overdraft to the account. Our honoring of any transaction that results in an overdraft to the account does not obligate us to honor such transactions in the future, or obligate us to provide notice to you of your discontinuance of honoring such transactions.

Checks with Legends Conditioning Payment
You agree not to directly or indirectly present any checks or other items bearing restrictive notations such as "Void after 90 days", or "Void if over $500".

You agree that if you directly or indirectly present such checks or other items, we will not be bound by the restrictive language and may pay the checks or other items without regard for the restrictions contained therein. In no event will we be liable for our refusal to honor your restrictions (whether or not we had previously honored or dishonored similar restrictions). You further agree to indemnify us and hold us harmless for any claims or losses arising out of our refusal to honor your restrictions.

Right of Setoff
The law provides that we may, but are not obligated to, take funds on deposit in your account tosatisfy a debt you owe us which is not paid when due. This is called the right of setoff. If weexercise this right of setoff, we shall comply with all applicable laws and regulations and wewill notify you promptly of the action taken if required by law to do so. To the fullest extentpermitted by law, all sums in your deposit accounts are subject to our right of setoff for anyliabilities owed to us by any of the following persons: any one or more of the account holders,including any other person who is a joint holder account; or any partnership of which you are ageneral partner; or any other person or entity with whom you are a co-obligor, or have agreed toact as surety or guarantor, or for whose debts you are liable or may be contingently liable. Ifwe exercise our right of setoff against an account that is subject to an early withdrawal penalty, the account may be assessed the applicable early withdrawal penalty.

Automated Clearing House Transactions ("ACH")
Under the operating rules of the National Automated Clearing House Association which are applicable to ACH transactions involving your account, La Jolla Bank is not required to give next day notice to you of receipt of an ACH item, and we will not do so. However, La Jolla Bank will continue to notify you of the receipt of payments in the periodic statements we provide to you.

Credit given by La Jolla Bank to you with respect to an automated clearing house credit entry is provisional until we receive final settlement for such entry through a Federal Reserve Bank. If La Jolla Bank does not receive such final settlement, you are hereby notified and agree that La Jolla Bank is entitled to a refund of the amount credited to you in connection with such entry, and the party making payment to you via such entry (i.e., the originator of the entry)shall not be deemed to have paid you the amount of such entry. La Jolla Bank may accept on your behalf payments to your account which have been transmitted through one or more Automated Clearing Houses ("ACH") and which are not subject to the Electronic Fund Transfer Act and your rights and obligations with respect to such payments shall be construed in accordance with and governed by the laws provided by the operating rules of the National Automated Clearing House Association, which are applicable to ACH transactions involving your account.

Our Right To Refuse Deposits
We may, at our discretion, refuse to accept funds for deposit to your account for any reason, including but not limited to: