AGREEMENT AND PLAN OF REORGANIZATION

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EXHIBIT 2.1

AGREEMENT AND PLAN OF REORGANIZATION

BETWEEN

FIRST BANCTRUST CORPORATION

AND

RANTOUL FIRST BANK, S.B.

APRIL 18, 2005

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TABLE OF CONTENTS

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ARTICLE 1 DEFINITIONS........................................................ 1

Section 1.1 Definitions........................................................ 1

Section 1.2 Principles of Construction......................................... 6

ARTICLE 2 THE MERGER......................................................... 8

Section 2.1 The Merger......................................................... 8

Section 2.2 Effective Time; Closing............................................ 8

Section 2.3 FBC's Deliveries at Closing........................................ 9

Section 2.4 Bank's Deliveries at Closing....................................... 10

Section 2.5 Bank Merger........................................................ 11

Section 2.6 Alternative Structure.............................................. 11

Section 2.7 Absence of Control................................................. 11

ARTICLE 3 CONVERSION OF SECURITIES IN THE MERGER............................. 12

Section 3.1 Manner of Merger................................................... 12

Section 3.2 Rights as Stockholders; Stock Transfers............................ 12

Section 3.3 Exchange Procedures................................................ 12

Section 3.4 Dissenting Shares.................................................. 13

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BANK............................. 13

Section 4.1 Bank Organization.................................................. 13

Section 4.2 Bank Subsidiary Organization....................................... 13

Section 4.3 Authorization; Enforceability...................................... 14

Section 4.4 No Conflict........................................................ 14

Section 4.5 Bank Capitalization................................................ 14

Section 4.6 Bank Subsidiary Capitalization..................................... 15

Section 4.7 Financial Statements and Reports................................... 16

Section 4.8 Books and Records.................................................. 16

Section 4.9 Title to Properties................................................ 16

Section 4.10 Condition and Sufficiency of Assets................................ 17

Section 4.11 Loans; Allowance for Loan and Lease Losses......................... 17

Section 4.12 Undisclosed Liabilities; Adverse Changes........................... 18

Section 4.13 Taxes.............................................................. 18

Section 4.14 Compliance with ERISA.............................................. 18

Section 4.15 Compliance with Legal Requirements................................. 18

Section 4.16 Legal Proceedings; Orders.......................................... 19

Section 4.17 Absence of Certain Changes and Events.............................. 19

Section 4.18 Properties, Contracts and Employee Benefit Plans................... 22

Section 4.19 No Defaults........................................................ 24

Section 4.20 Insurance.......................................................... 25

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Section 4.21 Compliance with Environmental Laws................................. 25

Section 4.22 Regulatory Filings................................................. 25

Section 4.23 Fiduciary Accounts................................................. 25

Section 4.24 Indemnification Claims............................................. 26

Section 4.25 Insider Interests.................................................. 26

Section 4.26 Brokerage Commissions.............................................. 26

Section 4.27 Approval Delays.................................................... 26

Section 4.28 Code Sections 280G and 4999........................................ 26

Section 4.29 Disclosure......................................................... 26

ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF FBC AND ACQUISITION COMPANY...... 28

Section 5.1 FBC Organization................................................... 27

Section 5.2 Authorization; Enforceability...................................... 27

Section 5.3 No Conflict........................................................ 27

Section 5.4 Approval Delays.................................................... 28

Section 5.5 Financial Resources................................................ 28

Section 5.6 Disclosure......................................................... 28

ARTICLE 6 BANK'S COVENANTS................................................... 28

Section 6.1 Access and Investigation........................................... 28

Section 6.2 Operation of Bank and Bank Subsidiaries............................ 29

Section 6.3 Negative Covenant.................................................. 31

Section 6.4 Subsequent Bank Financial Statements............................... 31

Section 6.5 Title to Real Estate............................................... 31

Section 6.6 Surveys............................................................ 31

Section 6.7 Environmental Investigation........................................ 31

Section 6.8 Advice of Changes.................................................. 32

Section 6.9 Other Offers....................................................... 32

Section 6.10 Voting Agreement................................................... 33

Section 6.11 Non-Competition Agreement.......................................... 33

Section 6.12 Stockholders' Meeting.............................................. 33

Section 6.13 Information Provided to FBC........................................ 34

Section 6.14 Amendment or Termination of Employee Benefit Plans................. 34

Section 6.15 Data and Item Processing Agreements................................ 34

Section 6.16 Tax Matters........................................................ 34

Section 6.17 Severance Agreements............................................... 34

Section 6.18 Accounting and Other Adjustments................................... 34

Section 6.19 Shambaugh Agreement................................................ ..

Section 6.20 ESOP and Profit Sharing Plan....................................... 36

ARTICLE 7 FBC'S COVENANTS.................................................... 37

Section 7.1 Information Provided to Bank....................................... 36

Section 7.2 Indemnification; Director and Officer Insurance.................... 36

Section 7.3 Employee Benefits.................................................. 36

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Section 7.4 Board Seats........................................................ 37

Section 7.5 Severance Benefits................................................. 37

Section 7.6 Negative Covenant.................................................. 39

Section 7.7 Advice of Changes.................................................. 39

Section 7.8 Management......................................................... 39

ARTICLE 8 COVENANTS OF ALL PARTIES........................................... 38

Section 8.1 Regulatory Approvals............................................... 38

Section 8.2 Necessary Approvals................................................ 38

Section 8.3 Customer and Employee Relationships................................ 38

Section 8.4 Publicity.......................................................... 39

Section 8.5 Best Efforts; Cooperation.......................................... 39

ARTICLE 9 CONDITIONS PRECEDENT TO OBLIGATIONS OF FBC......................... 39

Section 9.1 Accuracy of Representations and Warranties......................... 39

Section 9.2 Bank's Performance................................................. 39

Section 9.3 Documents Satisfactory............................................. 39

Section 9.4 Corporate Approval................................................. 40

Section 9.5 No Proceedings..................................................... 40

Section 9.6 Absence of Material Adverse Changes................................ 40

Section 9.7 Consents and Approvals............................................. 40

Section 9.8 No Prohibition..................................................... 40

Section 9.9 Severance Agreements............................................... 40

Section 9.10 Allowance for Loan and Lease Losses................................ 40

Section 9.11 Bank Capitalization................................................ 40

Section 9.12 Bank Transaction Expenses.......................................... 40

Section 9.13 Mimimum Stockholders' Equity....................................... 40

Section 9.14 Financing.......................................................... 40

Section 9.15 Fairness Opinion................................................... 41

Section 9.16 Cherry Orchards Apartments Sale.................................... 40

ARTICLE 10 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BANK.................... 41

Section 10.1 Accuracy of Representations and Warranties......................... 41

Section 10.2 FBC's Performance.................................................. 41

Section 10.3 Documents Satisfactory............................................. 41

Section 10.4 Corporate Approval................................................. 41

Section 10.5 No Proceedings..................................................... 41

Section 10.6 Consents and Approvals............................................. 42

Section 10.7 No Prohibitions.................................................... 42

Section 10.8 Fairness Opinion................................................... 42

ARTICLE 11 TERMINATION........................................................ 42

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Section 11.1 Reasons for Termination and Abandonment............................ 42

Section 11.2 Effect of Termination.............................................. 42

Section 11.3 Expenses........................................................... 43

Section 11.4 Termination Payment................................................ 43

ARTICLE 12 MISCELLANEOUS...................................................... 44

Section 12.1 Governing Law...................................................... 44

Section 12.2 Assignments, Successors and No Third Party Rights.................. 44

Section 12.3 Waiver............................................................. 44

Section 12.4 Notices............................................................ 44

Section 12.5 Entire Agreement................................................... 46

Section 12.6 Modification....................................................... 46

Section 12.7 Severability....................................................... 46

Section 12.8 Further Assurances................................................. 46

Section 12.9 Survival........................................................... 46

Section 12.10 Counterparts; Facsimiles........................................... 46

Section 12.11 Jurisdiction and Service of Process................................ 46

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APPENDIX INDEX

I. Merger Agreement

EXHIBIT INDEX

A Form of Legal Opinion of Counsel to First BancTrust Corporation

B Form of Legal Opinion of Counsel to Rantoul First Bank, s.b.

C Form of Exchange Agent Agreement

D Form of Voting Agreement

E Form of Non-Competition Agreement

F-1 Form of Ronnie Shambaugh Severance Agreement

F-2 Form of Kerwin Paris Severance Agreement

F-3 Form of Karen Hinton Severance Agreement

G Form of Release

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AGREEMENT AND PLAN OF REORGANIZATION

THIS AGREEMENT AND PLAN OF REORGANIZATION (this "AGREEMENT") is entered

into as of April 18, 2005 (the "AGREEMENT DATE"), among FIRST BANCTRUST

CORPORATION, a Delaware corporation ("FBC") and RANTOUL FIRST BANK, S.B., a

savings bank organized under the laws of the State of Illinois ("BANK").

RECITALS

A. The parties to this Agreement desire to effect a reorganization whereby

FBC will acquire control of Bank through the merger (the "MERGER") of RANTOUL

INTERIM BANK, an interim Illinois savings bank to be formed by FBC ("INTERIM

BANK") with and into Bank with Bank being the surviving institution in the

Merger (the "RESULTING BANK").

B. Pursuant to the terms of this Agreement, each outstanding share of the

common stock of Bank, $1.00 par value per share ("BANK COMMON STOCK"), shall be

converted at the effective time of the Merger into the right to receive cash as

set forth in this Agreement.

C. The parties desire to make certain representations, warranties and

agreements in connection with the Merger and also agree to certain prescribed

conditions to the Merger.

AGREEMENTS

In consideration of the foregoing premises and the following mutual

promises, covenants and agreements, the parties hereby agree as follows:

ARTICLE 1

DEFINITIONS

SECTION 1.1 DEFINITIONS. In addition to those terms defined throughout

this Agreement, the following terms, when used herein, shall have the following

meanings.

(a) "ADJUSTED STOCKHOLDERS' EQUITY" means the consolidated

tangible stockholders' equity of Bank, calculated in accordance with GAAP and

reflecting, among other things, the accrued income and expenses of Bank for all

periods ending on or prior to the Determination Date, and the recognition of or

accrual for all expenses paid or incurred or projected to be paid or incurred by

Bank or any Bank Subsidiary in connection with this Agreement and the

Contemplated Transactions including, but not limited to, Bank Transaction

Expenses, but adjusted to exclude:

(i) any realized gains or losses resulting from sales of

investment securities effected between December 31, 2004, and the Closing Date

(as defined below);

(ii) any adjustments made in accordance with Statement of

Financial Accounting Standard No. 115;

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(iii) any expenses incurred or accounting or other adjustments

made pursuant to Sections 2.5, 6.5, 6.6, 6.7 or 6.18 of this Agreement;

(iv) the cost of satisfying the Severance Payment

contemplated by Section 6.19 of this Agreement; and

(v) any adjustment in the Bank's investment portfolio to

reflect mark-to-market adjustments caused by changes in interest rates.

Bank's Adjusted Stockholders' Equity shall be calculated by Bank's independent

auditors, in consultation with FBC's independent auditors, as of the close of

business on the Determination Date using reasonable estimates of revenues and

expenses where actual amounts are not available. Such calculation shall be

subject to verification and approval prior to the Closing (as defined below) by

an auditor selected by FBC, which approval shall not be unreasonably withheld.

(b) "AFFILIATE" means with respect to:

(i)a particular individual: (A) each other member of such

individual's Family; (B) any Person that is directly or indirectly controlled by

such individual or one or more members of such individual's Family; (C) any

Person in which such individual or members of such individual's Family hold

(individually or in the aggregate) a Material Interest; and (D) any Person with

respect to which such individual or one or more members of such individual's

Family serves as a director, officer, partner, executor or trustee (or in a

similar capacity); and

(ii) a specified Person other than an individual: (A) any

Person that directly or indirectly controls, is directly or indirectly

controlled by, or is directly or indirectly under common control with such

specified Person; (B) any Person that holds a Material Interest in such

specified Person; (C) each Person that serves as a director, officer, partner,

executor or trustee of such specified Person (or in a similar capacity); (D) any

Person in which such specified Person holds a Material Interest; (E) any Person

with respect to which such specified Person serves as a general partner or a

trustee (or in a similar capacity); and (F) any Affiliate of any individual

described in clause (B) or (C) of this subsection (ii).

(c) "BANK STOCKHOLDER" means a holder of record of Bank Common

Stock.

(d) "BANK SUBSIDIARY" means any Subsidiary of Bank.

(e)"BANK TRANSACTION EXPENSES" means: (i) all transaction costs of

Bank necessary to consummate the Contemplated Transactions; (ii) the aggregate

fees and expenses of attorneys, accountants, consultants, financial advisors and

other professional advisors incurred by Bank in connection with this Agreement

and the Contemplated Transactions; (iii) the costs of preparing, printing and

mailing the Proxy Statement to Bank Stockholders and obtaining the approval of

Bank Stockholders of the Contemplated Transactions; (iv) all amounts paid or

payable to any director, officer or employee of Bank or any Bank Subsidiary

under any Contract or plan as a result of the Contemplated Transactions except

with respect to the Severance Payment contemplated by Section 6.19 of this

Agreement; (v) any Remediation Costs (as defined

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in Section 6.7 of this Agreement), and (vi) all other non-payroll related costs

and expenses in each case incurred or to be incurred by Bank or any Bank

Subsidiary through the Effective Time in connection with this Agreement and the

Contemplated Transactions.

(f) "BEST EFFORTS" means the efforts that a prudent Person desirous

of achieving a result would use in similar circumstances to ensure that such

result is achieved as expeditiously as possible, provided, however, that an

obligation to use Best Efforts under this Agreement does not require the Person

subject to that obligation to take actions that would result in a materially

adverse change in the benefits to such Person of this Agreement and the

Contemplated Transactions.

(g) "BREACH" means with respect to a representation, warranty,

covenant, obligation or other provision of this Agreement or any instrument

delivered pursuant to this Agreement: (i) any inaccuracy in or breach of, or any

failure to perform or comply with, such representation, warranty, covenant,

obligation or other provision; or (ii) any claim (by any Person) or other

occurrence or circumstance that is or was inconsistent with such representation,

warranty, covenant, obligation or other provision, and the term "Breach" means

any such inaccuracy, breach, failure, claim, occurrence or circumstance.

(h) "BUSINESS DAY" means any day on which the trading of stock

occurs on the over-the-counter-bulletin-board.

(i) "CALL REPORTS" means the quarterly reports of income and

condition filed by Bank with Regulatory Authorities.

(j) "CODE" means the Internal Revenue Code of 1986, as amended.

(k) "CONTEMPLATED TRANSACTIONS" means all of the transactions

contemplated by this Agreement, including: (i) the Merger; (ii) the performance

by FBC and Bank of their respective covenants and obligations under this

Agreement; (iii) FBC's acquisition of control of Bank; (iv) FBC's payment of

cash in exchange for shares of Bank Common Stock; and (v) the First Bank Merger

(as hereinafter defined), if applicable.

(l) "CONTRACT" means any agreement, contract, obligation, promise or

understanding (whether written or oral and whether express or implied) that is

legally binding: (i) under which a Person has or may acquire any rights; (ii)

under which such Person has or may become subject to any obligation or

liability; or (iii) by which such Person or any of the assets owned or used by

such Person is or may become bound.

(m) "CRA" means the Community Reinvestment Act, as amended.

(n) "DETERMINATION DATE" means the close of business on the last

Business Day preceding the Closing Date.

(o) "DFPR" means the Illinois Department of Financial and

Professional Regulation.

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(p) "DISSENTING SHARES" means those share which are held by

persons who perfect their dissenter's rights of appraisal under the ISBA.

(q) "ERISA" means the Employee Retirement Income Security Act of

1974, as amended.

(r) "FAMILY" means with respect to an individual: (i) the

individual; (ii) the individual's spouse and former spouses; (iii) any other

natural person who is related to the individual or the individual's spouse

within the second degree; and (iv) any other natural person who resides with

such individual.

(s) "FDIC" means the Federal Deposit Insurance Corporation.

(t) "FEDERAL RESERVE" means the Board of Governors of the Federal

Reserve System.

(u) "FIRST BANK" means First Bank and Trust, S.B., a savings bank

organized and existing under the laws of the State of Illinois with its main

office located in Paris, Illinois, and a wholly-owned subsidiary of FBC.

(v) "GAAP" means accounting principles generally accepted in the

United States consistent with those used in the preparation of the most recent

audited consolidated financial statements of FBC or Bank, as the case may be.

(w) "ISBA" means the Illinois Savings Bank Act.

(x) "KNOWLEDGE" with respect to:

(i) an individual means that such Person will be deemed to

have "Knowledge" of a particular fact or other matter if: (A) such individual is

actually aware of such fact or other matter; or (B) a prudent individual could

be expected to discover or otherwise become aware of such fact or other matter

in the course of conducting an investigation concerning the existence of such

fact or other matter; and

(ii) a Person (other than an individual) means that such

Person will be deemed to have "Knowledge" of a particular fact or other matter

if any individual who is serving, or who has served in the past twelve (12)

months as a director, executive officer, manager, partner, executor or trustee

of such Person (or in any similar capacity) has Knowledge of such fact or other

matter.

(y) "LEGAL REQUIREMENT" means any federal, state, local,

municipal, foreign, international, multinational or other Order, constitution,

law, ordinance, regulation, rule, policy statement, directive, statute or

treaty.

(z) "MATERIAL ADVERSE EFFECT" with respect to a Person (other than

an individual) means, an effect that (whether or not required to be accrued or

disclosed under Statement of Financial Accounting Standards No. 5): (i) is

material and adverse to the financial condition, results of operations,

properties, assets, liabilities, businesses or results of operations of

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such Person; or (ii) on the ability of such Person to perform its obligations

under this Agreement on a timely basis, but not including the effect of any

change of any Legal Requirement, or interpretation thereof by courts or

governmental agencies, changes in GAAP or regulatory accounting principles,

actions or omissions of a Party (or its Subsidiary) taken with the prior written

consent of the other Party or economic event affecting financial institutions

generally, or any change in the value of securities whether held as available

for sale or held to maturity, resulting from a change in interest rates.

(aa) "MATERIAL INTEREST" means the direct or indirect beneficial

ownership (as currently defined in Rule 13d-3 under the Securities Exchange Act)

of voting securities or other voting interests representing at least ten percent

(10%) of the outstanding voting power of a Person or equity securities or other

equity interests representing at least ten percent (10%) of the outstanding

equity securities or equity interests in a Person.

(bb) "ORDER" means any award, decision, injunction, judgment,

order, ruling, extraordinary supervisory letter, policy statement, memorandum of

understanding, resolution, agreement, directive, subpoena or verdict entered,

issued, made, rendered or required by any court, administrative or other

governmental agency, including any Regulatory Authority, or by any arbitrator.

(cc) "ORDINARY COURSE OF BUSINESS" means any action taken by a

Person only if such action:

(i) is consistent with the past practices of such Person and

is taken in the ordinary course of the normal day-to-day operations of such

Person;

(ii) is not required to be authorized by the board of

directors of such Person (or by any Person or group of Persons exercising

similar authority), other than loan approvals for customers of a financial

institution; and

(iii) is similar in nature and magnitude to actions

customarily taken, without any authorization by the board of directors (or by

any Person or group of Persons exercising similar authority), other than loan

approvals for customers of a financial institution, in the normal day-to-day

operations of other Persons that are in the same line of business as such

Person.

(dd) "PER SHARE CASH CONSIDERATION" means Twenty-Two Dollars and

Ten Cents ($22.10).

(ee) "PERSON" means any individual, corporation (including any

non-profit corporation), general or limited partnership, limited liability

company, joint venture, estate, trust, association, organization, labor union or

other entity or Regulatory Authority.

(ff) "PROCEEDING" means any action, arbitration, audit, hearing,

investigation, litigation or suit (whether civil, criminal, administrative,

investigative or informal) commenced, brought, conducted or heard by or before,

or otherwise involving, any judicial or governmental authority, including a

Regulatory Authority, or arbitrator.

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(gg) "PROXY STATEMENT" means the proxy statement to be used by Bank

in connection with the solicitation by its board of directors of proxies for use

at the meeting of its stockholders to be convened for the purpose of voting on

this Agreement and the Merger, pursuant to Section 6.12 of this Agreement.

(hh) "REGULATORY AUTHORITY" means any federal, state or local

governmental body, agency, court or authority that, under applicable Legal

Requirements: (i) has supervisory, judicial, administrative, police,

enforcement, taxing or other power or authority over Bank, FBC or any of their

respective Subsidiaries; (ii) is required to approve, or give its consent to the

Contemplated Transactions; or (iii) with which a filing must be made in

connection therewith, including, in any case, the Federal Reserve, the FDIC and

the DFPR.

(ii) "REPRESENTATIVE" means with respect to a particular Person,

any director, officer, manager, employee, agent, consultant, advisor or other

representative of such Person, including legal counsel, accountants and

financial advisors.

(jj) "SUBSIDIARY" means with respect to any Person (the "OWNER"),

any corporation or other Person of which securities or other interests having

the power to elect a majority of that corporation's or other Person's board of

directors or similar governing body, or otherwise having the power to direct the

business and policies of that corporation or other Person (other than securities

or other interests having such power only upon the happening of a contingency

that has not occurred) are held by the Owner or one or more of its Subsidiaries.

(kk) "TAX" means any tax (including any income tax, capital gains

tax, value added tax, sales tax, property tax, gift tax or estate tax), levy,

assessment, tariff, duty (including any customs duty), deficiency or other fee,

and any related charge or amount (including any fine, penalty, interest or

addition to tax), imposed, assessed or collected by or under the authority of

any Regulatory Authority or payable pursuant to any tax sharing agreement or any

other Contract relating to the sharing or payment of any such tax, levy,

assessment, tariff, duty, deficiency or fee.

(ll) "TAX RETURN" means any return (including any information

return), report, statement, schedule, notice, form or other document or

information filed with or submitted to, or required to be filed with or

submitted to, any Regulatory Authority in connection with the determination,

assessment, collection or payment of any Tax or in connection with the

administration, implementation, or enforcement of or compliance with any Legal

Requirement relating to any Tax.

(mm) "THREATENED" means a claim, Proceeding, dispute, action or

other matter for which any demand or statement has been made (orally or in

writing) or any notice has been given (orally or in writing), or if any other

event has occurred or any other circumstances exist, that would lead a prudent

Person to conclude that such a claim, Proceeding, dispute, action or other

matter is likely to be asserted, commenced, taken or otherwise pursued in the

future.

SECTION 1.2 PRINCIPLES OF CONSTRUCTION.

(a) In this Agreement, unless otherwise stated or the context

otherwise requires, the following uses apply:

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(i) actions permitted under this Agreement may be taken at

any time and from time to time in the actor's reasonable discretion;

(ii) references to a statute shall refer to the statute and

any successor statute, and to all regulations promulgated under or implementing

the statute or its successor, as in effect at the relevant time;

(iii) in computing periods from a specified date to a later

specified date, the words "FROM" and "COMMENCING ON" (and the like) mean "FROM

AND INCLUDING," and the words "TO," "UNTIL" and "ENDING ON" (and the like) mean

"TO, BUT EXCLUDING";

(iv) references to a governmental or quasi-governmental

agency, authority or instrumentality shall also refer to a regulatory body that

succeeds to the functions of the agency, authority or instrumentality;

(v) indications of time of day mean Paris, Illinois time;

(vi) "INCLUDING" means "INCLUDING, BUT NOT LIMITED TO";

(vii) all references to sections, schedules and exhibits are

to sections, schedules and exhibits in or to this Agreement unless otherwise

specified;

(viii) all words used in this Agreement will be construed to

be of such gender or number as the circumstances and context require;

(ix) the captions and headings of articles, sections,

schedules and exhibits appearing in or attached to this Agreement have been

inserted solely for convenience of reference and shall not be considered a part

of this Agreement nor shall any of them affect the meaning or interpretation of

this Agreement or any of its provisions; and

(x) any reference to a document or set of documents in this

Agreement, and the rights and obligations of the parties under any such

documents, shall mean such document or documents as amended from time to time,

and any and all modifications, extensions, renewals, substitutions or

replacements thereof.

(b) The schedules of Bank referred to in this Agreement (the "BANK

SCHEDULES" and collectively the "SCHEDULES") shall consist of the agreements and

other documentation described and referred to in this Agreement with respect to

such party, which Schedules were delivered by Bank to FBC before the date of

this Agreement. Any item or matter disclosed on any Schedule shall be deemed to

be disclosed for all purposes on all other Schedules, to the extent that it

should have been disclosed on such other Schedule, to the extent that sufficient

details are set forth so that the purpose for which disclosure is made is

reasonably clear. In the event of any inconsistency between the statements in

the body of this Agreement and those in the Schedules (other than an exception

expressly set forth as such in the Schedules), the statements in the body of

this Agreement will control;

(c) All accounting terms not specifically defined herein shall be

construed in accordance with GAAP; and

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(d) With regard to each and every term and condition of this

Agreement and any and all agreements and instruments subject to the terms

hereof, the parties hereto understand and agree that the same have or has been

mutually negotiated, prepared and drafted, and that if at any time the parties

hereto desire or are required to interpret or construe any such term or

condition or any agreement or instrument subject hereto, no consideration shall

be given to the issue of which party hereto actually prepared, drafted or

requested any term or condition of this Agreement or any agreement or instrument

subject hereto.

ARTICLE 2

THE MERGER

SECTION 2.1 THE MERGER. Subject to the terms and conditions of this

Agreement and in accordance with the ISBA and a Merger Agreement to be entered

into by and between Interim Bank and Bank (the "MERGER AGREEMENT"),

substantially in the form of Appendix I attached hereto, at the Effective Time

(as defined in the Merger Agreement), Interim Bank shall be merged with and into

Bank. The Bank shall be the Resulting Bank in the Merger and shall be considered

the same business and corporate entity as each merging bank and shall have the

other properties, liabilities and attributes as provided by the ISBA. As set

forth more fully in the Merger Agreement (which provisions control in the event

of any conflict with the terms of this Agreement) pursuant to the Merger:

(a) The articles of incorporation of Bank as in effect as of the

Effective Time, shall be the articles of incorporation of the Resulting Bank;

(b) The Bylaws of Bank as in effect immediately prior to the

Effective Time shall be, from and after the Effective Time, the Bylaws of the

Resulting Bank;

(c) The directors of Bank immediately prior to the Effective Time

shall be, from and after the Effective Time, the directors of the Resulting

Bank, except that there shall be two (2) persons designated by FBC to serve on

the Board of Directors of the Resulting Bank; and

(d) The officers of Bank immediately prior to the Effective Time

shall be, from and after the Effective Time, the officers of the Resulting Bank.

SECTION 2.2 EFFECTIVE TIME; CLOSING. Provided that this Agreement shall

not have been terminated in accordance with its express terms, the closing of

the Merger (the "CLOSING") shall occur through the mail (including facsimile or

e-mail) or at a place that is mutually acceptable to FBC and Bank, or if they

fail to agree, at the offices of Howard & Howard Attorneys, P.C., located at One

Technology Plaza, Suite 600, 211 Fulton Street, Peoria, Illinois 61602, at 10:00

a.m. on such date which is the end of the calendar month in which all of the

following conditions are satisfied: (i) the receipt of the last required

regulatory approval of the Merger and the expiration of the last requisite

waiting period; and (ii) the satisfaction or waiver in writing of all of the

conditions provided for in Articles 9 and 10 of this Agreement; whichever is

later, or at such other time as Bank and FBC may agree in writing (the "CLOSING

DATE"). Subject to the provisions of Article 11 of this Agreement, failure to

consummate the Merger on the date

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and time and at the place determined pursuant to this Section will not result in

the termination of this Agreement and will not relieve any party of any

obligation under this Agreement.

SECTION 2.3 FBC'S DELIVERIES AT CLOSING. At the Closing, FBC shall deliver

or cause to be delivered the following items to or on behalf of Bank:

(a) A good standing certificate for FBC issued by each of the

Secretary of State of the State of Delaware and the Secretary of State of the

State of Illinois and dated in each case not more than fifteen (15) Business

Days prior to the Closing Date;

(b) A copy of the certificate of incorporation of FBC certified

not more than fifteen (15) Business Days prior to the Closing Date by the

Secretary of State of the State of Delaware;

(c) A certificate of the Secretary or any Assistant Secretary of

FBC dated the Closing Date certifying a copy of the bylaws of FBC;

(d) Copies of resolutions of the board of directors of FBC

approving this Agreement and the consummation of the Contemplated Transactions,

certified as of the Closing Date by the Secretary or any Assistant Secretary of

FBC;

(e) A certificate executed by the Chief Executive Officer or a

Senior Vice President, and by the Secretary or any Assistant Secretary of FBC,

dated the Closing Date, stating that: (i) all of the representations and

warranties of FBC set forth in this Agreement, as the same may have been updated

pursuant to Section 7.7 of this Agreement, are true and correct in all material

respects with the same force and effect as if all of such representations and

warranties were made at the Closing Date, provided, however, that to the extent

such representations and warranties expressly relate to an earlier date, such

representations shall be true and correct in all material respects on and as of

such earlier date, and provided further, that to the extent that representations

and warranties are made in this Agreement subject to a standard of materiality

or Knowledge, such representations and warranties shall be true and correct in

all respects; and (ii) FBC has performed or complied in all material respects

with all of the covenants and obligations to be performed or complied with by it

under the terms of this Agreement on or prior to the Closing Date, provided,

however, that to the extent performance and compliance with such covenants and

obligations are subject in this Agreement to a standard of materiality, FBC

shall have performed and complied in all respects with such covenants and

obligations;

(f) A legal opinion of FBC's counsel dated the Closing Date in the

form attached as EXHIBIT A; and

(g) Such other documents as Bank may reasonably request.

All of such items shall be reasonably satisfactory in form and substance to Bank

and its counsel.

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SECTION 2.4 BANK'S DELIVERIES AT CLOSING. At the Closing, Bank shall

deliver or cause to be delivered the following items to FBC:

(a) A good standing certificate for Bank issued by the DFPR and

dated not more than fifteen (15) Business Days prior to the Closing Date;

(b) A copy of the articles of incorporation of Bank certified by

the DFPR and dated not more than fifteen (15) Business Days prior to the Closing

Date;

(c) A certificate of the Secretary of Bank dated the Closing Date

certifying a copy of the bylaws of Bank and stating that there have been no

further amendments to the articles of incorporation of Bank delivered pursuant

to the immediately preceding paragraph of this Section;

(d) Copies of resolutions of the board of directors and Bank

Stockholders authorizing and approving this Agreement, the Merger Agreement and

the consummation of the Contemplated Transactions certified as of the Closing

Date by the Secretary or any Assistant Secretary of Bank;

(e) A certificate executed by the Chief Executive Officer or

Executive Vice President, and by the Secretary or any Assistant Secretary of

Bank, dated the Closing Date, stating that: (i) all of the representations and

warranties of Bank set forth in this Agreement, as the same may have been

updated pursuant to Section 6.8 of this Agreement, are true and correct in all

material respects with the same force and effect as if all of such

representations and warranties were made at the Closing Date, provided, however,

that to the extent such representations and warranties expressly relate to an

earlier date, such representations shall be true and correct in all material

respects on and as of such earlier date, and provided further, that to the

extent that representations and warranties are made in this Agreement subject to

a standard of materiality or Knowledge, such representations and warranties

shall be true and correct in all respects; and (ii) Bank has performed or

complied in all material respects with all of the covenants and obligations to

be performed or complied with by it under the terms of this Agreement on or

prior to the Closing Date, provided, however, that to the extent performance and

compliance with such covenants and obligations are subject in this Agreement to

a standard of materiality, Bank shall have performed and complied in all

respects with such covenants and obligations;

(f) A list of all Bank Record Stockholders as of three (3)

Business Days immediately preceding the Determination Date, certified by the

Secretary or any Assistant Secretary of Bank;

(g) Owner's title insurance policies issued by Chicago Title

Insurance Company or such other title insurance company as is reasonably

acceptable to FBC in accordance with the title commitments delivered by Bank to

FBC in accordance with Section 6.5 of this Agreement, and in each case, in

policy amounts at least equal to the book value of the property covered by such

policies, as shown on the books and records of Bank;

(h) A legal opinion of Bank's counsel dated the Closing Date in

the form attached as EXHIBIT B;

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(i) A certificate of each of Bank's legal counsel, accountants and

financial advisor or investment banker, if any, representing that all of their

respective fees and expenses relating to the Contemplated Transactions incurred

by Bank prior to and including the Effective Time have been paid in full;

(j) The Severance Agreements contemplated by Section 6.17 of this

Agreement;

(k) The Release and evidence reasonably satisfactory to FBC that

the Severance Payment has been paid, each as contemplated by Section 6.19 of

this Agreement; and

(l) Such other documents as FBC may reasonably request.

All of such items shall be reasonably satisfactory in form and substance to FBC

and its counsel.

SECTION 2.5 BANK MERGER. The parties contemplate, without making it

mandatory, that after the Merger has become effective, Bank will be merged with

and into First Bank, with First Bank being the resulting bank (such merger of

Bank into First Bank being hereinafter called the "FIRST BANK MERGER"). FBC and

Bank agree to cooperate and to take such steps as may be necessary to obtain all

requisite regulatory, corporate and other approvals to effect the First Bank

Merger, subject and subsequent to the consummation of, and to be effective

concurrently with, the Merger or at such time thereafter, all as determined by

FBC in its sole discretion.

SECTION 2.6 ALTERNATIVE STRUCTURE. Notwithstanding anything contained

herein to the contrary, upon receipt of Bank's prior written consent (which

consent shall not be unreasonably withheld), FBC may specify, for any reasonable

business, tax or regulatory purpose, that, before the special meeting of

stockholders of Bank held pursuant to Section 6.12 of this Agreement, FBC and

Bank shall enter into transactions other than those described in this Agreement

to effect the purposes of this Agreement, including the merger of Bank with any

Affiliate of FBC, and the parties to this Agreement shall take all action

necessary and appropriate to effect, or cause to be effected, such transactions;

provided, however, that no such proposed change on the structure of the

transactions contemplated in this Agreement shall delay the Closing Date (if

such a date has already been established) by more than thirty (30) Business Days

or adversely affect the economic benefits, the form of consideration or the tax

effect of the Merger at the Effective Time to the holders of Bank Common Stock.

SECTION 2.7 ABSENCE OF CONTROL. Subject to any specific provisions of this

Agreement, it is the intent of the parties to this Agreement that neither FBC

nor Bank by reason of this Agreement shall be deemed (until consummation of the

Contemplated Transactions) to control, directly or indirectly, the other party

or any of its respective Subsidiaries and shall not exercise, or be deemed to

exercise, directly or indirectly, a controlling influence over the management or

policies of such other party or any of its respective Subsidiaries.

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ARTICLE 3

CONVERSION OF SECURITIES IN THE MERGER

SECTION 3.1 MANNER OF MERGER. Subject to the provisions of this Agreement

and the Merger Agreement, at the Effective Time, automatically by virtue of the

Merger and without any action on the part of any Person:

(a) Each share of Interim Bank common stock issued and outstanding

immediately prior to the Effective Time shall be converted into one validly

issued, fully paid and non-assessable share of common stock of the Resulting

Bank; and

(b) Each share of Bank Common Stock (other than shares held by

Bank or any Bank Subsidiary, except for shares held by any of them in a

fiduciary capacity, and Dissenting Shares) shall be converted into the right to

receive the Per Share Cash Consideration. The Per Share Cash Consideration that

may be paid, on an aggregate basis, to Bank Stockholders is referred to herein

as the "MERGER CONSIDERATION"; and

(c) Each share of Bank Common Stock held as treasury stock

immediately prior to the Effective Time shall be cancelled and retired at the

Effective Time and no consideration shall be issued in exchange therefor.

SECTION 3.2 RIGHTS AS STOCKHOLDERS; STOCK TRANSFERS. At the Effective

Time, holders of Bank Common Stock shall cease to be, and shall have no rights

as, stockholders of Bank, other than to receive the Merger Consideration. After

the Effective Time, there shall be no transfers on the stock transfer books of

Bank or the Surviving Corporation of shares of Bank Common Stock.

SECTION 3.3 EXCHANGE PROCEDURES.

(a) As soon as is reasonably practicable, but in no event later

than five (5) Business Days after the Closing Date, Illinois Stock Transfer

Company, in its capacity as exchange agent for the parties to this Agreement

(the "EXCHANGE AGENT"), shall mail to each holder of record of Bank Common

Stock, instructions for use in effecting the surrender of the certificates

representing such Bank Common Stock (the "CERTIFICATES") in exchange for the

Merger Consideration (the "TRANSMITTAL LETTER"). Upon proper surrender to the

Exchange Agent of Certificates for exchange and cancellation, together with such

properly completed and duly executed Transmittal Letter, the holder of such

Certificates shall be entitled to receive in exchange therefor a check

representing the amount of Merger Consideration that such holder is entitled to

receive pursuant to this Article;

(b) No later than the day before the Closing Date, FBC shall

deposit with the Exchange Agent for the benefit of holders of Certificates, cash

or immediately available funds equal to the aggregate Merger Consideration (the

"EXCHANGE FUND"). The Exchange Fund shall be held by the Exchange Agent for the

benefit of Bank Stockholders pursuant to the terms of an Exchange Agent

Agreement in the form of EXHIBIT C. After the Closing Date, FBC shall make

additional deposits to the Exchange Fund, and the Exchange Agent may return

certificates or funds held by the Exchange Agent, as may be necessary for the

completion of the exchange of

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Certificates for the Merger Consideration in accordance with this Article. All

fees, costs and expenses of the Exchange Agent shall be borne solely by FBC;

(c) No interest shall be paid to the holder of any unsurrendered

Certificate representing shares of Bank Common Stock converted in the Merger;

(d) Neither the Exchange Agent nor any party hereto shall be

liable to any former Bank Stockholder for any amount properly delivered to a

public official pursuant to applicable abandoned property, escheat or similar

laws; and

(e) Any portion of the Merger Consideration that remains unclaimed

by Bank Stockholders on the six (6) month anniversary of the Effective Time

shall be paid to FBC to be held for the benefit of holders of unsurrendered

Certificates. Any Bank Stockholders who have not theretofore complied with this

Article shall thereafter look only to FBC for payment of the Merger

Consideration.

SECTION 3.4 DISSENTING SHARES. Dissenter's rights shall be available to

stockholders of Bank as provided pursuant to the ISBA and the regulations

promulgated thereunder.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF BANK

Bank hereby represents and warrants to FBC that the following are true and

correct as of the Agreement Date, and will be true and correct as of the

Effective Time:

SECTION 4.1 BANK ORGANIZATION. Bank: (a) is a savings bank duly organized,

validly existing and in good standing under the laws of the State of Illinois

and is qualified to do business and is in good standing in the State of Illinois

and in each other jurisdiction in which the nature of the business conducted or

the properties or assets owned or leased by it makes such qualification

necessary; and (b) has full power and authority, corporate and otherwise, to

operate as a savings bank and to own, operate and lease its properties as

presently owned, operated and leased, and to carry on its business as it is now

being conducted. Copies of the articles of incorporation and bylaws of Bank and

all amendments thereto are set forth in SCHEDULE 4.1 and are complete and

correct. Bank has no Subsidiaries other than as set forth in SCHEDULE 4.1.

SECTION 4.2 BANK SUBSIDIARY ORGANIZATION. Each Bank Subsidiary is duly

organized, validly existing and in good standing in its state or jurisdiction of

organization. Each Bank Subsidiary has full power and authority, corporate and

otherwise, to own, operate and lease its properties as presently owned, operated

and leased, and to carry on its business as it is now being conducted, and is

duly qualified to do business and is in good standing in each jurisdiction in

which the nature of the business conducted or the properties or assets owned or

leased by it makes such qualification necessary. Copies of the articles of

incorporation and bylaws (or similar organizational documents) of each Bank

Subsidiary and all amendments thereto are set forth in SCHEDULE 4.2 and are

complete and correct.

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SECTION 4.3 AUTHORIZATION; ENFORCEABILITY.

(a) Bank has the requisite corporate power and authority to enter

into and perform its obligations under this Agreement. The execution, delivery

and performance of this Agreement by Bank, and the consummation by it of its

obligations under this Agreement, have been authorized by all necessary

corporate action, subject to stockholder approval, and this Agreement

constitutes a legal, valid and binding obligation of Bank enforceable in

accordance with its terms, except as such enforcement may be limited by

bankruptcy, insolvency, reorganization or other laws affecting creditors' rights

generally and subject to general principles of equity; and

(b) Except for ordinary corporate requirements, no "business

combination," "moratorium," "control share" or other state anti-takeover statute

or regulation or any provisions contained in the articles of incorporation or

bylaws or similar organizational documents of Bank or any Bank Subsidiary: (i)

prohibits or restricts Bank's ability to perform its obligations under this

Agreement, or its ability to consummate the Contemplated Transactions; (ii)

would have the effect of invalidating or voiding this Agreement, or any

provision hereof; or (iii) would subject FBC to any material impediment or

condition in connection with the exercise of any of its rights under this

Agreement. The board of directors of Bank has unanimously approved the execution

of, and performance by Bank of its obligations under, this Agreement.

SECTION 4.4 NO CONFLICT. Except as set forth in SCHEDULE 4.4, neither the

execution nor delivery of this Agreement nor the consummation or performance of

any of the Contemplated Transactions will, directly or indirectly (with or

without notice or lapse of time): (a) contravene, conflict with or result in a

violation of any provision of the articles of incorporation or bylaws (or

similar organizational documents), each as in effect on the Agreement Date, or

any currently effective resolution adopted by the board of directors or

stockholders of Bank or any Bank Subsidiary; (b) contravene, conflict with or

result in a violation of, or give any Regulatory Authority or other Person the

valid and enforceable right to challenge any of the Contemplated Transactions or

to exercise any remedy or obtain any relief under, any Legal Requirement or any

Order to which Bank or any Bank Subsidiary, or any of their respective assets

that are owned or used by them, may be subject, except for any contravention,

conflict or violation that is permissible by virtue of obtaining the regulatory

approvals necessitated by the Contemplated Transactions, including any such

approvals under the Bank Holding Company Act of 1956, as amended (the "BHCA"),

the Federal Deposit Insurance Act, as amended (the "FDIA"), and the ISBA; (c)

contravene, conflict with or result in a violation or breach of any provision

of, or give any Person the right to declare a default or exercise any remedy

under, or to accelerate the maturity or performance of, or to cancel, terminate

or modify any material Contract to which Bank or any Bank Subsidiary is a party

or by which any of their respective assets is bound; or (d) result in the

creation of any lien, charge or encumbrance upon or with respect to any of the

assets owned or used by Bank or any Bank Subsidiary. Except for the approvals

referred to in Section 8.1 and the requisite approval of its stockholders,

neither Bank nor any Bank Subsidiary is or will be required to give any notice

to or obtain any consent from any Person in connection with the execution and

delivery of this Agreement or the consummation or performance of any of the

Contemplated Transactions.

SECTION 4.5 BANK CAPITALIZATION.

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(a) The authorized capital stock of Bank consists, and immediately

prior to the Effective Time will consist, exclusively of 2,000,000 shares of

Bank Common Stock, $1.00 par value per share, of which 190,961 shares are, and

immediately prior to the Effective Time will be, duly authorized, validly issued

and outstanding and fully paid and non-assessable, and no shares are held by

Bank as treasury shares;

(b) None of the shares of Bank Common Stock have been issued in

violation of any federal or state securities laws or any other Legal

Requirement. No shares of Bank capital stock have been purchased, redeemed or

otherwise acquired, directly or indirectly, by Bank or any Bank Subsidiary and

no dividends or other distributions payable in any equity securities of Bank or

any Bank Subsidiary have been declared, set aside, made or paid to Bank

Stockholders. To the Knowledge of Bank, none of the shares of authorized capital

stock of Bank are, nor on the Closing Date will they be, subject to any claim of

right inconsistent with this Agreement. Except with respect to 15,276 shares of

Bank Common Stock held in Bank's Employee Stock Ownership Plan (the "ESOP"), all

of which are issued and outstanding, there are no shares of capital stock of

Bank or any Bank Subsidiary held in any Bank Employee Benefit Plan, as

hereinafter defined. There are no outstanding subscriptions, contracts,

conversion privileges, options, warrants, calls or other rights obligating Bank

or any Bank Subsidiary to issue, sell or otherwise dispose of, or to purchase,

redeem or otherwise acquire, any shares of capital stock of Bank or any Bank

Subsidiary, Bank is not a party to any Contract relating to the issuance,

purchase, sale or transfer of any equity securities or other securities of Bank.

Except as set forth in SCHEDULE 4.5, Bank does not own or have any Contract to

acquire any equity securities or other securities of any Person or any direct or

indirect equity or ownership interest in any other business; and

(c) Bank acknowledges that the Merger Consideration was determined

based upon the accuracy of the representations and warranties made in this

Section with respect to the number of outstanding shares of Bank Common Stock

and the absence of any options or other rights to purchase additional shares of

Bank Common Stock, and Bank acknowledges that any Breach of such representations

and warranties shall be deemed to have a Material Adverse Effect on Bank for

purposes of this Agreement.

SECTION 4.6 BANK SUBSIDIARY CAPITALIZATION. SCHEDULE 4.6 describes the

authorized capital stock of each Bank Subsidiary, all of which shares are, and

immediately prior to the Effective Time will be, duly authorized, validly issued

and outstanding, fully paid and nonassessable. Bank is, and will be immediately

prior to the Effective Time, the record and beneficial owner of one hundred

percent (100%) of the outstanding shares of capital stock of each Bank

Subsidiary, free and clear of any lien or encumbrance whatsoever and such shares

are, and will be on the Closing Date, freely transferable and are, and will be

on the Closing Date, subject to no claim except pursuant to this Agreement.

There are no unexpired or pending preemptive rights with respect to any shares

of capital stock of any Bank Subsidiary. There are no outstanding securities of

any Bank Subsidiary that are convertible into or exchangeable for any shares of

such Bank Subsidiary's capital stock and no Bank Subsidiary is a party to any

Contract relating to the issuance, sale or transfer of any equity securities or

other securities of such Bank Subsidiary. Neither Bank nor any Bank Subsidiary

owns or has any Contract to acquire, any equity securities or other securities

of any Person or any direct or indirect equity or ownership interest in any

other business, except as set forth in SCHEDULE 4.6.

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SECTION 4.7 FINANCIAL STATEMENTS AND REPORTS. True, correct and complete

copies of the following financial statements are included in SCHEDULE 4.7:

(a) Audited Consolidated Balance Sheets for Bank as of December 31,

2002, 2003 and 2004, and the related audited Consolidated Statements of

Operations, Statements of Cash Flows and Consolidated Statements of Changes in

Stockholders' Equity of Bank for the years ended December 31, 2002, 2003 and

2004; and

(b) Call Reports for Bank as of the close of business on December

31, 2002, 2003 and 2004.

The financial statements described in clause (a) have been prepared in

conformity with GAAP and comply in all material respects with all applicable

Legal Requirements. The financial statements described in clause (b) above have

been prepared on a basis consistent with past accounting practices and as

required by applicable Legal Requirements and fairly present the consolidated

financial condition and results of operations at the dates and for the periods

presented. Taken together, the financial statements described in clauses (a) and

(b) above (collectively, and including the notes thereto, the "BANK FINANCIAL

STATEMENTS") are complete and correct in all material respects and fairly and

accurately present the respective financial position, assets, liabilities and

results of operations of Bank as at the respective dates of, and for the periods

referred to in, Bank Financial Statements, subject to normal year-end

non-material audit adjustments in amounts consistent with past practice in the

case of the unaudited Bank Financial Statements. The Bank Financial Statements

do not include any material assets or omit to state any material liabilities,

absolute or contingent, or other facts, which inclusion or omission would render

Bank Financial Statements misleading in any material respect as of the

respective dates and for the periods referred to in the respective Bank

Financial Statements.

SECTION 4.8 BOOKS AND RECORDS. The books of account, minute books, stock

record books and other records of Bank and each Bank Subsidiary are complete and

correct in all material respects and have been maintained in accordance with

sound banking and business practices and all applicable Legal Requirements,

including the maintenance of any adequate system of internal controls required

by Legal Requirements. The minute books of Bank and each Bank Subsidiary contain

accurate and complete records in all material respects of all meetings held of,

and corporate action taken by, its respective stockholders, board of directors

and committees of the board of directors. At the Closing, all of those books and

records will be in the possession of Bank and Bank Subsidiaries.

SECTION 4.9 TITLE TO PROPERTIES. Bank and each Bank Subsidiary has good

and marketable title to all assets and properties, whether real or personal,

tangible or intangible, that it purports to own, subject to no valid liens,

mortgages, security interests, encumbrances or charges of any kind except: (a)

as noted in the most recent Bank Financial Statement or in SCHEDULE 4.9; (b)

statutory liens for Taxes not yet delinquent or being contested in good faith by

appropriate Proceedings and for which appropriate reserves have been established

and reflected on Bank Financial Statements; (c) pledges or liens required to be

granted in connection with the acceptance of government deposits, granted in

connection with repurchase or reverse repurchase agreements, pursuant to

borrowings from Federal Home Loan Banks or similar borrowings, or otherwise

incurred in the Ordinary Course of Business; and (d) minor defects and

irregularities in title and

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encumbrances that do not materially impair the use thereof for the purposes for

which they are held (all of such exceptions in clauses (a) through (d) are

collectively referred to as "PERMITTED EXCEPTIONS"). Except as set forth in

SCHEDULE 4.9, Bank and each Bank Subsidiary as lessee has the right under valid

and existing leases to occupy, use, possess and control any and all of the

respective property leased by it. Except where any failure would not reasonably

be expected to have a Material Adverse Effect on Bank, all buildings and

structures owned by Bank and each Bank Subsidiary lie wholly within the

boundaries of the real property owned or validly leased by it, and do not

encroach upon the property of, or otherwise conflict with the property rights

of, any other Person.

SECTION 4.10 CONDITION AND SUFFICIENCY OF ASSETS. The buildings,

structures and equipment of Bank and each Bank Subsidiary are structurally

sound, are in good operating condition and repair, and are adequate for the uses

to which they are being put, and none of such buildings, structures or equipment

is in need of maintenance or repairs except for ordinary, routine maintenance

and repairs that are not material in the aggregate in nature or in cost. The

assets and properties, whether real or personal, tangible or intangible, that

Bank or any Bank Subsidiary purport to own are sufficient for the continued

conduct of the business of Bank and each Bank Subsidiary after the Closing in

substantially the same manner as conducted prior to the Closing.

SECTION 4.11 LOANS; ALLOWANCE FOR LOAN AND LEASE LOSSES. Except as set

forth in SCHEDULE 4.11, all loans and loan commitments extended by Bank and any

Bank Subsidiary and any extensions, renewals or continuations of such loans and

loan commitments (the "BANK LOANS") were made and have been maintained

materially in accordance with the lending policies of such Bank Subsidiary in

the Ordinary Course of Business. The Bank Loans are evidenced by appropriate and

sufficient documentation and constitute valid and binding obligations to such

Bank Subsidiary enforceable in accordance with their terms, except as

enforceability may be limited by bankruptcy, insolvency, reorganization or other

laws affecting creditors' rights generally and subject to general principles of

equity. All such Bank Loans are, and at the Closing will be, free and clear of

any encumbrance or other charge (except for liens, if any, set forth in SCHEDULE

4.9) and each Bank Subsidiary has complied, and at the Closing will have

complied with all Legal Requirements relating to such Bank Loans, except where

any such failure to comply would not reasonably be expected to have a Material

Adverse Effect on Bank. The allowance for loan and lease losses of each Bank

Subsidiary is and will be on the Closing Date adequate in all material respects

to provide for possible or specific losses, net of recoveries relating to loans

previously charged off, and contains and will contain an additional amount of

unallocated reserves for probable future losses at an adequate level. To the

Knowledge of Bank: (i) none of the Bank Loans is subject to any material offset

or claim of offset; and (ii) the aggregate loan balances in excess of the Bank's

allowance for loan and lease losses are, based on past loan loss experience,

collectible in accordance with their terms (except as limited above) and all

uncollectible loans have been charged off.

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SECTION 4.12 UNDISCLOSED LIABILITIES; ADVERSE CHANGES. Except as set forth

in SCHEDULE 4.12, neither Bank nor any Bank Subsidiary has any material

liabilities or obligations of any nature (whether absolute, accrued, contingent

or otherwise), ex