PURCHASE AND ASSUMPTION AGREEMENT

PURCHASE AND ASSUMPTION AGREEMENT

          This Purchase and Assumption Agreement (this "Agreement") is made and entered into this 3 ^rd day of March, 2005 by and among Mutual Federal Savings Bank ("Purchaser"), Fidelity Federal Savings Bank ("Seller") and First Financial Bancorp the sole shareholder of Seller ("First Financial").

          WHEREAS, Seller desires to sell, and Purchaser desires to purchase, substantially all of the assets and liabilities of Seller upon the terms and conditions set forth herein; and

          WHEREAS, to induce Purchaser to enter into this Agreement, First Financial has agreed to make certain covenants and agreements herein, and to be responsible, in a primary capacity, for the obligations and duties of Seller under this Agreement, including, without limitation, indemnification obligations.

          NOW THEREFORE, in consideration of the premises and the mutual promises contained herein, the parties hereto agree as follows:

ARTICLE I
DEFINITIONS

          The following terms, which are not otherwise defined in this Agreement, shall have the following meanings:

          "Accounting Referee" means a firm of independent nationally recognized accountants having no material relationship with Purchaser, Seller or First Financial that is mutually acceptable to the parties hereto.

          "Agreement of Assumption of Liabilities" means the Agreement of Assumption of Liabilities to be executed by Seller and Purchaser, substantially in the form of Exhibit A hereto.

          "Ancillary Agreements" means the Bill of Sale, the Agreement of Assumption of Liabilities, the Assignment of Contracts, the FIRPTA Certificates, the Loan Assignments, the Limited Power of Attorney, the Real Estate Transaction Documents, the Retirement Account Transfer Agreement.

          "Assignment of Contracts" means the Assignment of Contracts to be executed by Seller and Purchaser relating to the transfer of the Assumed Contracts, substantially in the form of Exhibit B hereto.

          "Assumed Contracts" means the contracts of Seller listed on Schedule 3.8(a) .

          "Assumed Liabilities" means (a) the Closing Balance Sheet Liabilities, (b) the prospective obligations of Seller under the Assumed Contracts and (c) all liabilities

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identified in this Agreement as being assumed by Purchaser which relate to the Transferred Assets which arise after the Closing.

          "Base Retail Deposits" means the average of the Retail Deposits as of December 31, 2004 and January 31, 2005.

          "Base Retail Deposit Threshold" means 90% of the Base Retail Deposits.

          "Bill of Sale" means the Bill of Sale to be executed by Seller, substantially in the form of Exhibit C hereto.

          "Business Day" means any day of the year on which national banking institutions in the State of Indiana are open to the public for conducting business and are not required to close.

          "Claims" means all of Seller's rights to any choses in action, claims, causes or rights of action in connection with the Transferred Assets, Assumed Liabilities, and/or the business and operations of Seller, other than claims with respect to Excluded Assets.

          "Closing Balance Sheet Assets" means all assets of Seller of a type to be reflected on the face of a balance sheet prepared in accordance with GAAP appropriately adjusted for write-downs and allowances for loan losses and doubtful accounts other than the Excluded Assets and intangible assets, as of the close of business on the Closing Date, and as reflected on the Final Closing Balance Sheet.

          "Closing Balance Sheet Liabilities" means all liabilities of Seller of a type to be reflected on the face of a balance sheet prepared in accordance with GAAP other than the Excluded Liabilities, as of the close of business on the Closing Date, and as reflected on the Final Closing Balance Sheet.

          "Closing Book Value" means the Closing Balance Sheet Assets minus the Closing Balance Sheet Liabilities, as reflected on the Final Closing Balance Sheet.

          "Closing Book Value Deficit" means, if the Closing Book Value is less than the Target Closing Book Value, the amount by which the Closing Book Value is less than the Estimated Closing Book Value.

          "Closing Book Value Surplus" means, if the Closing Book Value is less than the Target Closing Book Value, the amount by which the Closing Book Value is greater than the Estimated Closing Book Value.

          "Closing Premium Decrease Amount" means, if the Closing Date is the Measurement Date, (a) the product of (i) the amount, if any, by which the Closing Date Retail Deposits are less than the Base Retail Deposit Threshold and (ii) 5%; minus (b) the Estimated Premium Adjustment, if any.

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          "Closing Premium Increase Amount" means, if the Closing Date is the Measurement Date and there is an Estimated Premium Adjustment, the difference between (a) the Estimated Premium Adjustment and (b) the product of (i) the amount, if any, by which the Closing Date Retail Deposits are greater than the Estimated Closing Date Retail Deposits and (ii) 5%.

          "Closing Transaction Consideration" means $20,000,000 minus the Estimated Closing Book Value Shortfall minus the Estimated Premium Adjustment.

          "Code" means the United States Internal Revenue Code of 1986, as amended.

          "Estimated Closing Balance Sheet" means the balance sheet of Seller to be provided by Seller to Purchaser pursuant to Section 2.3(a) reflecting Seller's best estimate of the Closing Balance Sheet Assets, Closing Balance Sheet Liabilities and Closing Book Value.

          "Estimated Closing Book Value" means the Closing Book Value reflected on the Estimated Closing Balance Sheet.

          "Estimated Closing Book Value Shortfall" means the amount by which the Estimated Closing Book Value is less than the Target Closing Book Value.

          "Estimated Premium Adjustment" means the product of (a) the amount, if any, by which the Retail Deposits on the Measurement Date (and, if the Measurement Date is the Closing Date, based upon the Estimated Closing Date Retail Deposits) are less than the Base Retail Deposit Threshold and (b) 5%.

          "Excluded Assets" means all tax assets of Seller including, without limitation, deferred tax assets; prepaid expenses of Seller that do not inure directly to the benefit of Purchaser including, without limitation, taxes, advertising, insurance (other than FDIC insurance premiums relating to the deposits that are Assumed Liabilities); inter-company assets, including without limitation, inter-company receivables; all contracts of Seller that are not Assumed Contracts; tax records, employee and personnel files, corporate minute books and stock books of Seller; corporate charter; "Fidelity Federal" tradename, the goodwill and all intellectual property rights associated with such tradename; and any balance sheet asset acquired or originated after January 31, 2005 in violation of Seller's covenants in Sections 5.6 and 5.7 of this Agreement.

          "Excluded Liabilities" means all tax liabilities of Seller including, without limitation, deferred tax liabilities; inter-company liabilities, including without limitation, inter-company payables; liabilities for compensation and benefits to employees including, without limitation, salaries, bonuses, severance and change in control benefits, and unused vacation and sick time; liabilities relating to contracts that are not Assumed Contracts; any balance sheet liability incurred after January 31, 2005 in violation of Seller's covenants in Sections 5.6 and 5.7 of this Agreement; and all other obligations and liabilities of Seller of any kind and nature, known, unknown, accrued, absolute,

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contingent or otherwise, whether now existing or hereafter arising whatsoever, other than the Assumed Liabilities.

          "FDIC" means the Federal Deposit Insurance Corporation.

          "FIRPTA Certificates" means the FIRPTA Certificates executed by Seller, in substantially the form of Exhibit D hereto.

          "GAAP" means generally accepted accounting principles effective in the United States as applied on a consistent basis throughout the periods indicated.

          "Governmental Authority" means any government, any governmental entity, department, commission, agency, board, authority, official, body or instrumentality, and any court, tribunal, or judicial or arbitral body, whether federal, state, local or foreign.

          "Lien" means, with respect to any asset, any mortgage, lien, license, pledge, charge, security interest, restriction or encumbrance or rights of others of any kind in respect of a Transferred Asset, other than in the case of real estate, (i) non-monetary restrictions or easements of record which do not detract from the value or marketability of such real estate, and (ii) zoning, entitlement, building and other land use regulations imposed by Governmental Authorities which are not violated by the current use and operation of such real property.

          "Limited Power of Attorney" means the power of attorney to be executed by Seller granting Purchaser the right to execute instruments relating to the loans included in the Transferred Assets on behalf of and as the act and deed of Seller, in substantially the form of Exhibit E hereto.

          "Loan Assignments" means one or more instruments of assignment of the loans included in the Transferred Assets in recordable form to be executed by Seller, which instruments, to the extent permitted by law, may be executed by Purchaser on behalf of, in the name of, and as the act and deed of Seller pursuant to the Limited Power of Attorney.

          "Material Adverse Change" means any event, occurrence, change, effect or condition of any character that has had or could reasonably be expected to have a Material Adverse Effect.

          "Material Adverse Effect" means a material adverse effect on (a) the business, condition (financial or other), assets, liabilities or results of operations of Seller, or (b) the ability of Seller to consummate the transactions contemplated by this Agreement in a timely manner; provided, however, that, for purposes of this Agreement, "Material Adverse Effect" shall not include any effect to the extent caused by (x) a change in general economic conditions, and (y) a change to banking laws and regulations.

          "Measurement Date" means May 31, 2005 or the Closing Date, whichever date on which there is the greater amount of Retail Deposits.

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          "Permits" means all assignable permits, authorizations, certificates, approvals and licenses issued by a Governmental Authority to Seller relating to the Transferred Assets, Transferred Liabilities, and/or the business or operations of Seller.

          "Person" means an individual, corporation, partnership, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

          "Real Estate Transfer Documents" means all documents to be executed by Seller to transfer good, marketable, insurable and indefeasible title to Purchaser of all real estate owned by Seller, free and clear of all Liens, other than Permitted Liens, including, without limitation, special warranty deeds and vendor affidavits.

          "Retail Deposits" means all of the deposit liabilities of Seller, including, without limitation, the deposits of the educational institution previously identified to Purchaser, but excluding brokered and wholesale deposits.

          "Retirement Account Transfer Agreement" means the Retirement Account Transfer Agreement to be executed by Seller and Purchaser relating to the transfer of certain fiduciary accounts, in substantially the form of Exhibit F hereto.

          "Target Closing Book Value" means $9.4 million.

          "Total Transaction Consideration" means the Closing Transaction Consideration plus the Closing Book Value Surplus or minus the Closing Book Value Deficit and plus the Closing Premium Increase Amount or minus the Closing Premium Decrease Amount.

          "Transferred Assets" means all of the assets of Seller other than the Excluded Assets including, without limitation, the Closing Balance Sheet Assets, the Assumed Contracts, the Claims, the Permits, books and records, telephone and facsimile numbers, Federal Reserve routing numbers, intangible assets, goodwill, and all other properties, assets and rights of Seller of every kind and description, which are owned or used by Seller in connection with its business or operations.

ARTICLE II
TRANSFER; CLOSING; PURCHASE PRICE; ADJUSTMENTS

          2.1      Asset Transfer and Assumption of Liabilities; Deliveries .

                    (a)      Transfer of Transferred Assets and Assumption of Assumed Liabilities . Upon the terms and subject to the conditions of this Agreement, at the Closing (as hereinafter defined), (i) Seller shall sell, transfer and assign to Purchaser all of Seller's right, title and interest in and to Transferred Assets, free and clear of any Liens, other than Liens reflected in the Interim Financial Statements (as hereinafter defined) to secure long-term borrowings ("Permitted Liens"); and (ii) Purchaser shall assume and be bound by, and agree to pay and perform, the Assumed Liabilities.

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Notwithstanding anything to the contrary in this Agreement, the Excluded Assets shall not hereby be sold or transferred by Seller and shall be retained by it, and the Excluded Liabilities shall not hereby be assumed by Purchaser and shall remain the exclusive liabilities and obligations of Seller.

                    (b)      Pre-Closing Deliveries . On the date hereof, Seller shall provide to Purchaser a statement detailing the Base Retail Deposits, which statement shall be attached hereto as Schedule 2.1(b)(i) and incorporated herein by reference. On or before June 15, 2005, Seller shall provide to Purchaser a statement detailing its Retail Deposits as of May 31, 2005, which statement shall be attached hereto as Schedule 2.1(b)(ii) and incorporated herein by reference. Seller shall, at the request of Purchaser, provide Purchaser with such additional information as reasonably required to verify the accuracy of the information set forth on Schedules 2.1(b)(i) and 2.1(b)(ii). If Purchaser disputes any of the amounts or the methodology in the calculations contained in such Schedules, such dispute shall be resolved in the same manner as disagreements under Section 2.3(c).

                    (c)      Closing Deliveries . At the Closing, Seller shall deliver to Purchaser all of the Assumed Contracts, the books and records relating to the Transferred Assets, Assumed Liabilities, and the business and operations of Seller (other than books and records included in the Excluded Assets), together with duly executed originals of all Ancillary Agreements to which Seller is a party. At the Closing, Purchaser shall deliver to Seller duly executed originals of all Ancillary Agreements to which Purchaser is a party.

          2.2      Closing . The consummation of the purchase and assumption transactions provided for in this Agreement (the "Closing") shall occur as of the close of business on a Business Day mutually agreed upon by the parties after receipt by the parties of all required regulatory approvals and all other approvals required by law or contract for consummation of the transactions provided for herein and lapse of all required waiting periods associated therewith (the "Closing Date"). The Closing shall be held at Seller's principal office or at such other place mutually agreed upon by the parties. At the Closing, (i) Purchaser shall tender to Seller a certified check in the amount of the Closing Transaction Consideration, or at the election of Seller, Purchaser shall pay the Closing Transaction Consideration to Seller on the next Business Day by wire transfer of immediately available funds to a bank account designated by Seller, (ii) Seller shall deliver to Purchaser the Assumed Contracts and the books and records as provided in Section 2.1(b) above, and (iii) the parties shall execute and deliver the Ancillary Agreements to which they are parties.

          2.3.      Purchase Price Adjustment .

                    (a)      Preparation of Estimated Closing Balance Sheet; Closing Date Adjustment . Seller shall prepare in good faith and, not later than 2 Business Days prior to the Closing Date, deliver to Purchaser (i) the Estimated Closing Balance Sheet reflecting thereon Seller's best estimate of the Closing Balance Sheet Assets, the Closing Balance Sheet Liabilities, and the Estimated Closing Book Value as of the close of business on the Closing Date and immediately prior to giving effect to the transactions

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contemplated by this Agreement and the Ancillary Agreements, (ii) Seller's best estimate of the Estimated Closing Book Value Shortfall, if any, based on the Estimated Closing Balance Sheet, (iii) Seller's best estimate of the Retail Deposits as of the close of business on the Closing Date (the "Estimated Closing Date Retail Deposits"), and (iv) Seller's determination of the Estimated Premium Adjustment, if any, based upon the Retail Deposits on the Measurement Date. The Estimated Closing Balance Sheet shall (x) fairly present the estimated Closing Balance Sheet Assets, Closing Balance Sheet Liabilities and Closing Book Value, immediately prior to giving effect to the transactions contemplated by this Agreement and the Ancillary Agreements, (y) include line items substantially consistent with those used in the preparation of the balance sheets included in the Seller Financial Statements and (z) be prepared in accordance with GAAP. If, based on the Estimated Closing Balance Sheet, there is an Estimated Closing Book Value Shortfall and/or an Estimated Premium Adjustment, Purchaser shall deduct the amount thereof in determining the Closing Transaction Consideration to be paid by Purchaser to Seller.

                    (b)      Preparation of Final Closing Balance Sheet . As soon as practicable following the Closing Date, and in any event within 30 days thereof, Seller shall prepare and deliver to Purchaser (i) a definitive closing balance sheet reflecting Seller's final calculation and determination of the Closing Balance Sheet Assets, Closing Balance Sheet Liabilities and Closing Book Value as of the close of business on the Closing Date and immediately prior to giving effect to the transactions contemplated by this Agreement and the Ancillary Agreements (the "Final Closing Balance Sheet"), (ii) a calculation of the Closing Book Value Surplus or Closing Book Value Deficit, as the case may be, if any, based upon the Final Closing Balance Sheet, (iii) a calculation of the Retail Deposits as of the close of business on the Closing Date (the "Closing Date Retail Deposits") and (iv) a calculation of the Closing Premium Increase Amount or Closing Premium Decrease Amount, as the case may be, based upon the Closing Date Retail Deposits, if applicable. The Final Closing Balance Sheet shall (x) fairly present the Closing Balance Sheet Assets, Closing Balance Sheet Liabilities and Closing Book Value as of the close of business on the Closing Date and immediately prior to giving effect to the transactions contemplated by this Agreement and the Ancillary Agreements, (y) include line items substantially consistent with those used in the preparation of the balance sheets included in the Seller Financial Statements and (z) be prepared in accordance with GAAP. Purchaser shall, and shall cause its representatives to, cooperate with Seller and provide timely access to all relevant information for purposes of preparing the Final Closing Balance Sheet, including, without limitation, making available to Seller such books, records, work papers and personnel, to the extent necessary and relevant to such preparation.

                    (c)      Disagreement . Purchaser may dispute any element of the Final Closing Balance Sheet or other calculations prepared by Seller pursuant to Section 2.3(b) by notifying Seller of such disagreement in writing and setting forth in reasonable detail the particulars of such disagreement, within 30 days after its receipt of the Final Closing Balance Sheet and associated calculations. In the event that Purchaser does not provide such a notice of disagreement within such 30-day period, then Purchaser shall be deemed to have accepted the Final Closing Balance Sheet and associated calculations delivered

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by Seller, which shall be final, binding and conclusive on the parties for all purposes hereunder. In the event any such notice of disagreement is provided on a timely basis, Seller and Purchaser shall use their commercially reasonable efforts for a period of 10 days (or such longer period as they may mutually agree) to resolve any disagreements with respect to the Final Closing Balance Sheet and/or associated calculations. If, at the end of such period, Seller and Purchaser are unable to resolve such disagreements, then the Accounting Referee shall resolve any remaining disagreements. The Accounting Referee shall determine as promptly as practicable, but in any event within 15 days of the date on which such dispute is referred to the Accounting Referee, whether the Final Closing Balance Sheet and associated calculations were properly prepared in accordance with the standards set forth in Section 2.3(b), and shall deliver to Seller and Purchaser a written report setting forth its findings, which shall be final, conclusive and binding on Seller and Purchaser relating to the entries and items contained in the Final Closing Balance Sheet and/or the associated calculations. The date on which the Final Closing Balance Sheet and/or associated calculations are finally determined in accordance with Section 2.3(b) or this Section 2.3(c) shall be the "Determination Date." The fees and expenses of the Accounting Referee in connection with its services under this Section 2.3(c) shall be paid one-half by Seller and one-half by Purchaser. Each party shall, and shall cause its representatives to, cooperate with the other parties and provide timely access to information for purposes of resolving any dispute pursuant to this Section 2.3(c), including without limitation, making available to the other parties such books, records, work papers and personnel, to the extent necessary and relevant to resolving such dispute.

                    (d)      Payment . If, based on the Final Closing Balance Sheet and/or associated calculations as finally determined pursuant to Section 2.3(b) or 2.3(c), there is a Closing Book Value Surplus, a Closing Book Value Deficit, a Closing Premium Increase Amount, and/or a Closing Premium Decrease Amount, then the parties shall make an adjustment for the net amount thereof plus interest from the Closing Date to the date of payment as set forth below. To the extent that there is a Closing Book Value Deficit and/or Closing Premium Decrease Amount and the amount thereof exceeds the Closing Book Value Surplus, if any, or the Closing Premium Increase Amount, if any, then the amount thereof shall be paid by Seller to Purchaser, together with interest at the federal funds rate from the Closing Date to the date of payment, in immediately available funds as soon as practicable after the Determination Date, but not later than five 5 Business Days after the Determination Date. To the extent that there is a Closing Book Value Surplus and/or Closing Premium Increase Amount and the amount thereof exceeds the Closing Book Value Deficit, if any, or the Closing Premium Decrease Amount, if any, then the amount thereof shall be paid by Purchaser to Seller, together with interest at the federal funds rate from the Closing Date to the date of payment, in immediately available funds as soon as practicable after the Determination Date, but not later than five 5 Business Days after the Determination Date.

          2.4      Allocation of Total Transaction Consideration. Within 30 days after the Determination Date, Purchaser shall prepare and deliver to Seller (a) a proposed statement of allocation which shall provide for the allocation of the Total Transaction Consideration and the amount of the Closing Balance Sheet Liabilities assumed by

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Purchaser in accordance with Purchaser's reasonable assessment of the relative fair market values of the Transferred Assets (the "Proposed Tax Allocation") and (b) a proposed IRS Form 8594 completed in accordance with the Proposed Tax Allocation Statement. If Seller does not notify the Purchaser within 15 Business Days of receipt of the Proposed Tax Allocation of any disagreement with the proposed allocation, the Proposed Tax Allocation will become the final allocation (the "Final Tax Allocation"). If Seller notifies the Purchaser within such period (the "Allocation Notice") of its disagreement with the Proposed Tax Allocation, Seller and Purchaser will in good faith attempt to resolve their disagreement. If Seller and Purchaser are unable to resolve their disagreement, all disputed matters that have not been resolved will be submitted for resolution in accordance with the provisions set forth in Section 2.3(c), above. As soon as practicable thereafter, Seller and Purchaser shall execute such Form 8594 in accordance with the allocation set forth in the Final Tax Allocation and in compliance with Section 1060 of the Code, and the rules and regulations thereunder. The parties hereto shall adopt and utilize the asset values as determined on the Final Tax Allocation hereto for all tax accounting and reporting purposes and each of Seller and Purchaser shall file all tax returns (including amended returns and claims for refund) and information reports in a manner consistent with such allocation and shall not voluntarily take any action inconsistent therewith upon examination of any tax return, in any refund claim, in any litigation or otherwise with respect to such tax returns.

          2.5      Assumed Contracts or Rights Not Transferable . If any Assumed Contract or any other property or right included in the Transferred Assets is not assignable or transferable either by virtue of the provisions thereof or under applicable law without the consent of some other Person and any such consent is not obtained prior to the Closing, this Agreement and the related instruments of transfer shall not constitute an assignment or transfer thereof and, unless otherwise agreed between Purchaser and Seller with respect thereto, Purchaser shall not assume Seller's obligations with respect thereto, but Seller shall use its best efforts to obtain any such consent as soon as possible after the Closing or otherwise obtain for Purchaser the practical and economic benefit of such Assumed Contract, property or right and Purchaser (without any cost or expense to it) shall use all commercially reasonable efforts to assist Seller in that endeavor. In the event that Seller and a third party continue to be parties to an Assumed Contract after the Closing as a result of a consent not having been obtained, Purchaser shall perform under such agreement if it receives the benefits thereof.

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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER

Seller hereby makes the following representations and warranties to Purchaser:

          3.1      Corporate Organization . Seller is a federally chartered savings bank duly organized and existing under the laws of the United States and possesses full corporate power and all necessary approvals to carry on its business as presently conducted and to own and use its assets and properties as presently owned and used by it.

          3.2      Corporate Authority and Action . Seller has full right, power and authority to sell, convey, assign, transfer and deliver the Transferred Assets and the Assumed Liabilities to Purchaser and to otherwise fully perform Seller's obligations under this Agreement, subject however to (a) Seller receiving all required regulatory approvals and (b) compliance by Purchaser with all of its obligations under this Agreement. Seller has full right, power and authority to execute and deliver this Agreement, the Ancillary Agreements to which it is a party, and each other document and instrument contemplated hereby. This Agreement, each Ancillary Agreement to which Seller is a party, and each such other document and instrument, constitutes (or will constitute when executed and delivered by Seller) a valid and binding obligation of Seller enforceable in accordance with its terms except as the same may be limited by bankruptcy, insolvency, reorganization, or other laws relating to or affecting the enforcement of creditors' rights including, without limitation, the avoidance powers of the FDIC pursuant to the Federal Deposit Insurance Act and except as courts of equity may limit certain remedies such as specific performance. This Agreement, the Ancillary Agreements to which Seller is a party, and the transactions contemplated hereby have been approved by the Boards of Directors of Seller and First Financial, and no other corporate or shareholder action is required on the part of Seller or First Financial relating hereto or thereto.

          3.3      Non-Contravention . The execution, delivery and performance by each of Seller and First Financial of this Agreement and by Seller of each Ancillary Agreement to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not (a) contravene or conflict with any of the governing documents of Seller or First Financial; (b) contravene or conflict with any provisions of any law, regulation, judgment, injunction, order, Permit or decree binding upon or applicable to Seller or First Financial; (c) constitute a default (with or without notice or lapse of time, or both) under, or give rise to any right of termination, amendment, cancellation or acceleration of any right or obligation, or a loss of any benefit, under any Transferred Asset including, without limitation, any Assumed Contract or any Assumed Liability including, without limitation, any deposit liability or liability for borrowed funds; or (d) result in the creation or imposition of any Lien on any of the Transferred Assets.

          3.4      Investments . Other than the Marion Castle Partners Limited Partnership, Seller does not have any equity investment in, or profit or loss interest in, any Person, other than equity investments that are readily marketable securities.

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          3.5      Financial Statements .

                    (a)      Schedule 3.5 , which is attached hereto and incorporated herein by reference, contains true and complete copies of:

                    (b)     Each of the balance sheets included in the Seller Financial Statements fairly presents in all material respects the financial position of Seller as of its date, and the other statements included in the Seller Financial Statements fairly present in all material respects the results of operations and cash flows, as the case may be, of Seller for the periods therein set forth, in each case in accordance with GAAP, except for the absence of footnotes and in the case of the 2004 Consolidating Financial Statements for adjustments relating to inter-company transactions.

                    (c)     Seller maintains a system of accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management's general or specific authorization; and (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets.

          3.6      Fixed Assets .

                    (a)     To the knowledge of Seller, the fixed assets that are owned or leased by Seller have no material defects, are in good operating condition and repair (ordinary wear and tear excepted), and are suitable for the purposes for which they are presently used. Such fixed assets are adequate to conduct the business of Seller as presently conducted.

                    (b)     All leases of fixed assets are in good standing and are valid, binding and enforceable in accordance with their respective terms, and there does not exist under any such lease any default by Seller, nor, to the knowledge of Seller, by any other Person, or any event that, with notice or lapse of time or both, would constitute a default by Seller or, to the knowledge of Seller, by any other Person. All leases of fixed assets are included in the Assumed Contracts.

                    (c)     None of the fixed assets owned by Seller is subject to any Lien.

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                    (d)     Seller maintains adequate property liability and casualty insurance on its fixed assets and in accordance with all of its contractual obligations relating to leased fixed assets.

          3.7      Real Property .

                    (a)     All real property used by Seller in the conduct of its business is owned by Seller. Schedule 3.7(a) , which is attached hereto and incorporated herein by reference, lists and describes all real property owned by Seller.

                    (b)     Seller has good and marketable, insurable, indefeasible, fee simple title to all of its real property, free and clear of any Liens. No portion of any of Seller's real property is subject to any lease or other occupancy arrangement, or is occupied by any Person other than Seller.

                    (c)     Seller does not lease any real property in connection with the conduct of its business.

                    (d)     The plants, buildings, structures, fixtures and improvements (including without limitation, the roofs thereof) located on or which constitute a part of Seller's real property are in good operating condition and repair, to the knowledge of Seller, do not contain any material defects, and have been reasonably maintained consistent with standards generally followed in the industry (giving due account to the age and length of use of same, ordinary wear and tear excepted), are suitable for their present uses and are structurally sound.

                    (e)     Each parcel of Seller's real property currently has access to public ways, duly laid out and accepted by the appropriate local jurisdictions, either directly or over valid, recorded and insurable easements over private ways or private property for ingress to and egress from such parcel and connections to water supply, storm and sewer facilities, telephone, gas and electrical connections and other public utilities (collectively, the "Access Rights"). All of such Access Rights are of sufficient width and capacity to permit the business of Seller to be conducted as presently conducted, and, to the knowledge of Seller, without interference, challenge or complaint from any neighbors or abutters to such parcel or from any municipal authorities having jurisdiction over such Access Rights.

                    (f)     To the knowledge of Seller, no parcel of Seller real property or any plants, buildings, fixtures, structures or improvements located thereon or the present use thereof is in violation of or out of conformity with any laws, regulations, or orders, including without limitation, zoning, subdivision, building, building code, health, safety, traffic, flood control, wetlands, or other land use laws, variances, Permits or orders of any Governmental Authority having jurisdiction over the real property.

                    (g)     None of the real property of Seller is subject to any actual or to the knowledge of Seller, threatened, condemnation or similar proceeding or to any proposed

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special tax assessment, and neither Seller nor First Financial has any knowledge that any such action is reasonably likely to occur at a future date.

                    (h)     Seller maintains adequate property liability and casualty insurance on its real property, including, without limitation, all plants, buildings, structures, fixtures and improvements contained thereon.

          3.8      Assumed Contracts; No Restrictive Contracts; and Affiliated Services .

                    (a)      Schedule 3.8(a) , which is attached hereto and incorporated herein by reference, lists and contains true and complete copies of the Assumed Contracts.

                    (b)     The Assumed Contracts are all of the contracts required for the conduct of business by Seller as presently conducted except for data processing contracts.

                    (c)     None of the Assumed Contracts is with a party that is affiliated with Seller.

                    (d)     All the Assumed Contracts are in good standing and are valid, binding and enforceable in accordance with their respective terms, and there does not exist under any Assumed Contract any default by Seller, nor, to the knowledge of Seller or First Financial, by any other party thereto, or any event that, with notice or lapse of time or both, would constitute a default by Seller or, to the knowledge of Seller or First Financial, by any other Person. Except as set forth in Schedule 3.8(d) , which is attached hereto and incorporated herein by reference, each Assumed Contract that is material to the business or operations of Seller does not require the consent of any Person relating to the assignment and transfer thereof to Purchaser or the assumption by Purchaser of Seller's prospective obligations thereunder.

                    (e)     Seller is not a party to or otherwise bound by any contract which limits its ability to engage in any business activity or compete with any Person.

                    (f)     No services are provided by any affiliates of Seller to Seller, except as set forth in Schedule 3.8(f) , which is attached hereto and incorporated herein by reference.

          3.9      Litigation . Other than litigation with respect to the Sold Loans, there are no actions, causes of action, claims, suits or proceedings, pending or, to Seller's or First Financial's knowledge, threatened, against Seller or First Financial affecting any of the Transferred Assets, any of the Assumed Liabilities, or the business or operations of Seller, whether at law, in equity or before or by any Governmental Authority, and to Seller's or First Financial's knowledge, there are no unresolved disputes under any written or oral agreement, whether express or implied, to which Seller or First Financial is a party or by which either of them is bound that could adversely affect any of the Transferred Assets, any of the Assumed Liabilities or the transactions contemplated hereby, and neither Seller nor First Financial has any knowledge of any state of facts or the occurrence of any event which could form the basis for any such claim or dispute.

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          3.10      Deposit Liabilities . The deposit liabilities of Seller are insured by the FDIC to the fullest extent permitted under federal law, and no action is pending or, to the knowledge of Seller, has been threatened by FDIC against Seller with respect to the termination or revocation of such insurance. Seller is classified 1-A for purposes of calculating FDIC insurance premiums. The deposit liabilities of Seller (a) are in all respects genuine and enforceable obligations of Seller and have been acquired and maintained in material compliance with all applicable laws, including, without limitation, the Truth in Savings Act and regulations promulgated thereunder; (b) were acquired in the ordinary course of Seller's business; and (c) to the knowledge of Seller, are not subject to any claims that are superior to the rights of the Persons shown on the records delivered (or to be delivered) to Purchaser indicating the owners of the deposit liabilities, other than claims against such deposit owners, such as state and federal tax liens, garnishments, and other judgment claims, which have matured or may mature into claims against the respective deposits.

          3.11      Loans . All notes and other evidences of indebtedness in favor of Seller in connection with any of the loans of Seller (other than the Sold Loans), including, without limitation, any and all security agreements, guarantees, mortgages and other collateral documents accompanying the same, are correct in amount, genuine as to signatures of the makers, endorsers or signatories thereof or thereto, were given for a valid consideration and represent binding claims against such makers, endorsers or signatories for the full amount shown on the books and records of Seller. All loans of Seller have been made or acquired by Seller in accordance with Board of Director-approved loan policies. Seller holds the loans contained in its loan portfolio for its own benefit to the extent of its interest shown therein. To the knowledge of Seller, such loans include liens having the priority indicated by their terms, subject, as of the date of recordation or filing of applicable security instruments, only to such exceptions as are discussed in attorneys' opinions regarding title or in title insurance policies in the loan files relating to the loans secured by real property or are not material as to the collectability of such loans. To the knowledge of Seller, all loans owned by it are with full recourse to the borrowers and guarantors, if any, and Seller has not taken any action that would result in a waiver or negation of any rights or remedies available by it against any borrower or guarantor, if any, on any loan. All applicable remedies against all borrowers and guarantors are enforceable except as such enforcement may be limited by general principles of equity whether applied in a court of law or a court in equity and by bankruptcy, insolvency, fraudulent conveyance, and similar laws affecting creditors' rights and remedies generally. A true, correct and complete copy of the loan delinquency report prepared by Seller, which report includes all loans delinquent or otherwise in default as of January 31, 2005, is set forth in Schedule 3.11 , which is attached hereto and incorporated herein by reference. Seller has properly fulfilled in all material respects its contractual responsibilities and duties in any loan in which it acts as the lead lender or servicer and has complied in all material respects with its duties as required under applicable regulatory requirements. To the knowledge of Seller, it has (or its predecessor in interest has in the case of acquired loans) properly perfected or caused to be properly perfected all security interests, Liens, or other interests in any collateral securing any loans made or held by Seller. The loan file for each loan (a) complies with the record keeping

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requirements of Seller's primary bank (or thrift) regulator, (b) is maintained in accordance with industry standards and practices, (c) contains all documents, instruments and other information necessary or appropriate to (i) comply with the underwriting requirements applicable thereto and/or (ii) enforce the rights of Seller under the notes, other evidences of indebtedness, security agreements, guaranties, mortgages and other collateral documents in favor of Seller in connection with such loan.

          3.12      Title to Assets . Seller has good and marketable title to the Transferred Assets, and complete and unrestricted power to sell, transfer and assign the Transferred Assets to Purchaser subject to the receipt of all required regulatory approvals, free and clear of any and all Liens, other than Permitted Liens.

          3.13      Compliance with Laws . Seller is in material compliance with all laws and regulations applicable to the Transferred Assets, the Assumed Liabilities, and the operation of its business as presently conducted, including, without limitation, material compliance with all interest and usury laws, laws and regulations concerning truth-in-lending, truth-in-savings, fair credit reporting, consumer protection, occupational safety, civil rights, and labor and/or employment laws. Seller has received a satisfactory or better rating in its latest Community Reinvestment Act examination or interim review. Neither Seller nor First Financial knows of any reason why all required regulatory approvals necessary to consummate the transactions contemplated hereby will not be obtained upon appropriate application therefor without the imposition of any non-standard condition.

          3.14      Reporting . Seller has timely filed all applicable reports, returns and filing information data required to be filed by it with the Internal Revenue Service, all other taxing authorities, and all other Governmental Authorities and regulatory agencies. To the extent that Purchaser possesses tax information, which is not possessed by Seller, relating to the preparation of Form 1099s with respect to deposit liabilities and loans of Seller for calendar year 2005 through the Closing Date, Purchaser shall make such records available to Seller and otherwise assist Seller in the preparation of Form 1099s with respect to Seller's deposit liabilities and loans through the Closing Date, and Seller shall be solely responsible to file such Form 1099s.

          3.15      Environmental Matters . Purchaser and Seller mutually agree that this Section 3.15 is intended to constitute the complete and exclusive understanding between the parties with respect to all environmental matters.

                    (a)      Environmental Representations and Warranties . Seller represents and warrants to Purchaser that (i) neither Seller nor First Financial has knowledge of any violation of any Environmental Law emanating from, occurring on, under or in any way related to, any real property owned or leased by Seller, or the business operations of Seller, (ii) to the knowledge of Seller or First Financial, the real property owned or leased by Seller currently is not, and while Seller has owned or leased it has not been, contaminated with Hazardous Substances such that remediation has been, may be or is required by applicable law, rule or regulation, (iii) Seller has not handled any Hazardous Substance, except in accordance with applicable laws, rules or regulations, (iv) to the knowledge of Seller or First Financial, no oral or written notification of a Release of a

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Hazardous Substance has been filed, or may reasonably required to be filed, by or on behalf of Seller, and (v) no real property owned or leased by Seller is listed or, to the knowledge of Se