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(b)
    
    Liabilities. For purposes of this Agreement, Liabilities
shall mean all of Sellers obligations and liabilities of every
type and character relating to all deposit accounts, including
accrued interest, which are reflected on the books of Seller as
of the Closing and are attributable to the Branches, including,
without limitation, all passbook accounts, statement savings
accounts, checking, Money Market and NOW accounts, certificates
of deposit, individual retirement accounts, simplified employee
pension accounts, saving incentive match plan for employees
accounts, Keogh accounts, and repurchase agreements except for
the Excluded Deposits (the Assumed Deposits). Liabilities
shall also include:




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(a)
    
    Preliminary Closing Statement. Not less than five (5) days
prior to the Closing Date, Seller shall deliver to Purchaser a
proposed preliminary closing statement, in the form of Schedule
B to this Agreement, completed as at a date mutually agreed to
by the parties. The parties shall agree upon the preliminary
closing statement before the Closing Date, and it shall be the
basis of a preliminary payment to be made to Purchasers
account, or to Sellers account, as the case may be, on the
Closing Date (the Preliminary Payment).(b)
    
    Preliminary Payment. Subject to the terms and conditions hereof,
at the Closing, Seller shall wire transfer to Purchaser
immediately available funds equal to: (i) the sum of (A) the
amount of the Assumed Deposits (including accrued and unpaid
interest thereon) reflected on the preliminary closing statement
and (B) the amount of all accrued and unpaid expenses reflected
as a liability on the preliminary closing statement; less (ii)
an amount equal to the sum of: (A) X.X% of the Assumed Deposits
based on a 30-day average prior to Closing; (provided, however,
that for purposes of this Section 1.03(b)(ii)(A), Assumed
Deposits shall not be deemed to include (1) any public funds or
(2) any amounts relating to repurchase agreements); (B) the
amount of cash on hand at the Branches as of the Closing;
the Agreed Value of all furniture, fixtures, and equipment
constituting part of the Assets; (D) the Agreed Value of the
Owned Real Estate and the Leased Real Estate; (E) the amount of
all prepaid expenses of Seller as reflected as an asset on the
preliminary closing statement; (F) the Net Book Value of all
Loans, plus accrued and unpaid interest thereon as reflected
on the preliminary closing statement; and (G) the amount of
estimated sales taxes, if any, to be paid by Purchaser in
connection with the transaction contemplated hereby.(c)
    
    Purchaser Payment. In the event that the amount equal to
subclause (b)(ii) above exceeds the amount equal to subclause
(b)(i) above, the amount of such excess shall constitute an
amount due from Purchaser to Seller and shall be paid to Seller
at the Closing.




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(a)
    
    Loan Information. Prior to the date hereof, Seller provided to
Purchaser certain information relating to the Loans to be
transferred to Purchaser, which included, among other data,
summary information relating to loan delinquencies.(b)
    
    Opportunity to Review and Reject Loans. Following the date
hereof, Purchaser shall be provided with the opportunity to
conduct a limited due diligence review of the Loans for the
purpose of determining whether Purchaser desires to purchase the
Loans in their entirety. Purchaser shall complete such due
diligence review within a period of fourteen (14) days after the
date upon which Purchaser is first provided access to
documentation relating to the Loans. Within seven (7) days
following the end of the fourteen (14) day period referred to in
the immediately preceding sentence, Purchaser shall notify
Seller as to whether Purchaser shall accept or reject the Loans,
provided however, that Purchaser shall only be permitted to
accept or reject all of the Loans other than overdraft lines
directly attributable to the Assumed Deposits. In the event
that Purchaser notifies Seller that it intends to reject the
Loans, the payment under Section 1.03(b) shall be calculated
without giving effect to any amounts described in (F)
thereunder.




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(c)
    
    Loan Documentation. Seller shall indemnify Purchaser for any
and all losses which arise as a direct result of the failure of
Seller to have delivered to Purchaser all necessary
documentation with respect to any Loan, provided, however, that
Seller shall not be obligated to indemnify Purchaser pursuant to
this Section 1.08(c) in the event that Purchaser shall not have
notified Seller of the missing documentation within sixty (60)
days following the Closing. For purposes of this provision, a
loss shall mean a loss of the principal balance of the
affected Loan outstanding as of the Closing Date and any
interest accrued thereon.
     (a)
    
    Operation of Branches. Seller shall continue to operate and
maintain the Branches in a manner consistent with its customary
practices and in a condition substantially the same as exists on
the date hereof (ordinary wear and tear and casualty excepted).(b)
    
    Information Concerning Branches. Seller shall use its reasonable
efforts to furnish Purchaser, its agents, or representatives
reasonable access to, and permit Purchaser to make or cause to
be made such reasonable investigation of, information and
materials relating to the financial and physical condition of
the Branches as Purchaser reasonably deems necessary or
advisable; provided, further, that nothing in this Section
2.01(b) shall be deemed to require Seller to breach any
obligation of confidentiality or to reveal any proprietary
information, trade secrets, or marketing or strategic plans.




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(c)
    
    Creation of Encumbrances. Seller shall not voluntarily create
any Encumbrances affecting the Owned Real Estate.(d)
    
    Insurance. Seller will maintain in effect until and including
the Closing Date all casualty and public liability policies
relating to the Branches and maintained by Seller on the date
hereof or procure comparable replacement policies and maintain
such replacement policies in effect until and including the
Closing Date.(e)
    
    Right to Intervene. In the event that any claim, protest, suit
or other proceeding is instituted against Purchaser under this
Agreement, Seller shall have the right, at its discretion and
expense, to intervene in such litigation, and Purchaser hereby
consents to such intervention.(f)
    
    Retention of Certain Assets. Seller shall retain all Assets as
to which it has received notification pursuant to Section
2.02(c) hereof and the Book Value of such Assets shall not be
included in the calculation of the Preliminary Payment or the
Adjustment Payment.
  (a)
    
    Certain Applications. Not later than twenty-one (21) days after
the date hereof, Purchaser shall prepare and submit for filing,
at no expense to Seller, applications to all regulatory agencies
required by Purchaser to obtain the Regulatory Approvals.
Purchaser shall promptly deliver to Seller a copy of such
applications and any supplement, amendment, or item of
additional information in connection therewith. Purchaser shall
also promptly deliver to Seller a copy of each material notice,
order, opinion, approval or denial and other item of
correspondence received by Purchaser from the regulatory
agencies and shall keep Seller promptly informed of developments
and progress with respect to such matters. Purchaser hereby




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represents that it knows of no reason why it should not obtain
all Regulatory Approvals in a timely manner.(b)
    
    Real Estate Lease Consents. In connection with the consent and
release noted in Section 2.03 hereof, Purchaser shall provide to
Seller within five (5) days after the date hereof current
financial information concerning Purchaser for Sellers
transmittal to the landlord under each Lease and shall provide
promptly to Seller any other information requested by such
landlord.(c)
    
    Notice Regarding Certain Assets. In connection with the branch
teller and platform automation equipment described in Section
1.02(a)(ii) hereof, Purchaser shall notify Seller, in writing,
within forty-five (45) days of the date hereof, of any such
Assets that Purchaser shall not purchase.




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(a)
    
    Title Commitments. Seller, at its sole expense, shall deliver
to Purchaser not later than thirty (30) days after the date
hereof, with respect to the Owned Real Estate, title commitments
for issuance of ALTA Owners Policies of Title Insurance
(collectively, the Title Commitments and individually, aTitle Commitment) issued not earlier than thirty (30) days
prior to the execution of this Agreement and issued by a title
insurance company authorized to do business in the state in
which the Owned Real Estate is located designated by Seller (the
Title Company).(b)
    
    Surveys. For thirty (30) days from the date hereof, Purchaser
shall have the right, but not the obligation, to obtain, at
Purchasers sole cost and expense, (i) surveys as to any or all
of the Owned Real Estate or the Leasehold Estate and (ii) title
commitments for issuance of ALTA Leasehold Policies of Title
Insurance as to the Leasehold Estate from the Title Company
(Leasehold Title Commitment). Purchaser shall cause a true and
complete copy of each survey to be promptly delivered to Seller
and to the Title Company. Purchaser shall cause a true and
complete copy of each Leasehold Title Commitment to be promptly
delivered to Seller.(c)
    
    Title Defects. (i) Ten (10) days after receipt by Purchaser of
an original Title Commitment or any survey or Leasehold Title
Commitment obtained pursuant to Section 2.04(b) hereof,
Purchaser shall give Seller and the Title Company written notice
of any defect(s) disclosed in such Title Commitment, survey or
Leasehold Title Commitment that: (w) is (are) not included in
the exceptions specifically identified on the Title Commitment
or Leasehold Title Commitment; (x) is(are) not included in
clauses (a)-(d) of the definition of Permitted Exceptions
related to the applicable Owned Real Estate or Leased Real
Estate; (y) that materially adversely affect(s) the business of
the Branch situated upon such Owned Real Estate or Leased Real




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Estate; and (z) which Purchaser does not approve. Failure of
Purchaser to provide such notice on a timely basis shall
constitute a waiver by Purchaser of any matter(s) disclosed in
such Title Commitment, survey or Leasehold Title Commitment and
thereupon such matter(s) shall be deemed included in clause (b)
of the definition of Permitted Exceptions set forth in this
Agreement.(ii)
    
    If the notice referred to in (i) above is timely given by
Purchaser, Seller shall, within ten (10) days of such notice,
notify Purchaser and the Title Company as to whether Seller
shall cure or remove any defect(s). Following Sellers notice to
Purchaser and the Title Company that Seller elects not to cure
any defect(s), Purchaser must elect, within five (5) days, as
its sole remedy hereunder with respect to such defect(s), to
terminate this Agreement as to the Assets and Liabilities
attributable to the Branch situated upon the affected Owned Real
Estate and/or Leased Real Estate. Purchasers failure to make
such an election shall be deemed to be a waiver of such
defect(s) and such defect(s) shall be included in the Permitted
Exceptions and shown as Permitted Exceptions in the deed and the
title policy relating to such Owned Real Estate or Leasehold
Estate.(iii)
    
    Seller shall cause the Title Company to update the Title
Commitments and Purchaser may, at its sole cost and expense,
cause the Title Company to update Leasehold Title Commitments,
as of the business day prior to the Closing Date. In the event
that the updated Title Commitment or Leasehold Title Commitment
as to any Owned Real Estate or Leasehold Estate discloses any
defect(s) not included in the original Title Commitment, survey
or Leasehold Title Commitment, the procedure set forth in (ii)
above shall apply.




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(a)
    
    Corporate Organization and Authority. Seller is a national
banking association duly organized, validly existing, and in
good standing under the laws of the United States of America
with corporate power to carry on its business as presently
conducted at the Branches. Seller is an insured bank, as
defined in the Federal Deposit Insurance Act and applicable
regulations thereunder (FDIA). Seller is a member of the Bank
Insurance Fund of the FDIC (BIF) and pays deposit insurance
assessments to BIF and the Savings Association Insurance Fund.
Seller is in compliance in all material respects with all
applicable fair lending laws, rules and regulations, including
without limitation the Community Reinvestment Act of 1977, as
amended. Seller has all requisite corporate power and authority
and has taken all corporate action necessary to execute and
deliver this Agreement and to consummate the transaction
contemplated hereby, and this Agreement is a valid and binding
obligation of Seller in accordance with its terms subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors rights
generally, whether applied at law or equity, and to general
equity principals.(b)
    
    Effective Agreement. Subject to the receipt of any and all
Regulatory Approvals and required third party consents, the
execution, delivery, and performance of this Agreement by Seller
and the consummation of the transaction contemplated hereby,
will not conflict with, result in the breach of, constitute a
violation or default, result in the acceleration of payment or
other obligations, or create an Encumbrance, under any of the
provisions of the Charter or By-Laws of Seller, under any
judgment, decree, or order, under any law, rule, or regulation
of any government or agency thereof, or under any material
contract or instrument to which Seller is subject, where such
conflict, breach, violation, default, acceleration, or
Encumbrance would have a material adverse effect on the business
of any Branch or Sellers ability to perform its obligations
hereunder.(c)
    
    Individual Retirement Accounts. The Individual Retirement
Custodial Account Agreement (i.e. Internal Revenue Service Model
Form 5305-A with certain supplementary provisions) used at the
Branches materially meets the criteria for the establishment of
an individual retirement account as specified in Section




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408(a) of the Code in all material respects.(d)
    
    Simplified Employee Pension Accounts. The Simplified Employee
Pension  Individual Retirement Account Agreement (i.e.
Internal Revenue Service Model Form 5305-SEp with certain
supplementary provisions) and the Salary Reduction and Other
Elective Simplified Employee Pension  Individual Retirement
Account Agreement (i.e. Internal Revenue Service Model Form
5305A-SEP with certain supplementary provisions) used at the
Branches materially meets the criteria for the establishment of
a simplified employee pension as specified in Section 408(k)
of the Code in all material respects.(e)
    
    Saving Incentive Match Plan for Employees Accounts. The Saving
Incentive Match Plan for Employees of Small Employers Agreement
(i.e. Internal Revenue Service Model Form 5305-SIMPLE with
certain supplementary provisions) used at the Branches
materially meets the criteria for the establishment of a saving
incentive match plan for employees as specified in Section
408(p) of the Code in all material respects.(f)
    
    Keogh Accounts. The custodial agreement for the retirement plan
for self-employed individuals used at the Branches materially
meets the criteria for the establishment of a Keogh plan as
specified in Section 401(a) and Section 401(c) of the Code in
all material respects.(g)
    
    No Broker. No broker or finder, or other party or agent
performing similar functions, has been retained by Seller or is
entitled to be paid based upon any agreements, arrangements, or
understandings made by Seller in connection with the transaction
contemplated hereby, and no brokerage fee or other commission
has been agreed to be paid by Seller on account of such
transaction.(h)
    
    Environmental. Seller makes the representations and warranties
to Purchaser set forth in Section 10.01 hereof.(i)
    
    Assets. The fixed Assets material to the operations of each of
the Branches are in adequate working condition for the conduct
of the business at each of the Branches currently conducted by
Seller except for ordinary wear and tear.




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(j)
    
    Deposits. All of the Assumed Deposits have been administered
and, to Sellers knowledge, originated, in material compliance
with the documents governing the relevant type of deposit
account and all applicable laws. The Assumed Deposits are
insured by the Bank Insurance Fund or the Savings Association
Insurance Fund of the FDIC up to the current applicable maximum
limits, and no action is pending or, to Sellers knowledge,
threatened by the FDIC with respect to the termination of such
insurance.(k)
    
    Limitation of Warranties. Except as otherwise specifically
provided for in this Agreement, Seller makes no representations
or warranties whatsoever with respect to the Assets or the
Liabilities, express or implied, including, without limitation,
any warranties with respect to merchantability, fitness, title,
enforceability, collectibility, documentation or freedom from
liens or encumbrances (in whole or in part).
  (a)
    
    Corporate Organization, Authority and Compliance. Purchaser is
a national bank duly organized, validly existing, and in good
standing under the laws of the United States of America with
corporate power to own its properties and to carry on its
business as presently conducted, except where the failure of
Purchaser to have such corporate power would not have a material
adverse effect on the ability of Purchaser to perform its
obligations hereunder. Purchaser is an insured bank, as defined
in the FDIA. Purchaser has all requisite corporate power and
authority and has taken all corporate action necessary to
execute and deliver this Agreement and to consummate the
transaction contemplated hereby, and this Agreement is a valid
and binding obligation of Purchaser in accordance with its terms
subject, as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws
of general applicability relating to or affecting creditors
rights generally, whether applied at law or equity, and to
general equity principals. Purchaser is in compliance with all
applicable fair lending laws, rules and regulations including
but not limited to the Community Reinvestment Act of 1977, as




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amended.(b)
    
    Effective Agreement. Subject to the receipt of any and all
Regulatory Approvals and required third party consents, the
execution, delivery, and performance of this Agreement by
Purchaser and the consummation of the transaction contemplated
hereby, will not conflict with, result in the breach of,
constitute a violation or default, result in the acceleration of
payment or other obligations, or create an Encumbrance, under
any of the provisions of the Articles of Association or By-Laws
of Purchaser, under any judgment, decree, or order, under any
law, rule, or regulation of any government or agency thereof, or
under any material contract or instrument to which Purchaser is
subject, where such conflict, breach, violation, default,
acceleration, or lien would have a material adverse effect on
Purchasers ability to perform its obligations hereunder.(c)
    
    No Broker. No broker or finder, or other party or agent
performing similar functions, except Austin Associates, Inc.,
has been retained by Purchaser or is entitled to be paid based
upon any agreements, arrangements, or understandings made by
Purchaser in connection with the transaction contemplated
hereby, and no brokerage fee or other commission has been agreed
to be paid by Purchaser on account of such transaction.(d)
    
    Regulatory Matters. (i) Except as previously disclosed in
writing to Seller, there are no pending, or, to Purchasers
knowledge, threatened or contemplated, disputes or controversies
(including any written order, decree, agreement or memorandum of
understanding, or Commitment Letter or similar submission) with,
to or between Purchaser and any federal, state or local
governmental agency or authority that, individually or in the
aggregate, would have a material adverse effect on Purchasers
ability to perform any of its obligations hereunder.




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(e)
    
    Financing Available. Purchasers ability to consummate the
transactions contemplated by this Agreement is not contingent on
raising any equity capital, obtaining specific financing
thereof, obtaining the consent of any lender or any other
matter.




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(a)
    
    Offer of Employment. Seller shall make available and
Purchaser shall hire, as of the Closing Date, all Branch
Employees, at salaries, or at base wages, not less than the
current salaries or base wages paid to such Branch Employees as
of the Closing Date. Purchaser shall be responsible for all
obligations (including any obligation to provide notices) or
liabilities, if any, which may arise in connection with any
Branch Employee under the Workers Adjustment and Retraining
Notification Act (the WARN Act) and Purchaser shall indemnify
Seller for any and all losses which Seller may incur under the
WARN Act in connection with any Branch Employee due to actions
taken by Purchaser.(b)
    
    Employee Benefits. All Branch Employees shall be eligible to
participate in Purchasers employee benefit plans and fringe
benefit plans (including, without limitation, pension and profit
sharing plans, retirement income and post retirement welfare
benefits, health insurance benefits (medical and dental),
disability, life and accident insurance, sickness benefit,
vacation, employees loans, and banking privileges) on the same
basis as such plans and benefits exist and are offered to
employees of Purchaser with comparable positions with Purchaser.
Purchaser shall credit such Branch Employees for their length of
service with Seller, its predecessors, or its affiliates, for
all purposes under each employee benefit and fringe benefit plan
to be provided by Purchaser to such Branch Employees and for
purposes of vesting and eligibility (but not for purposes
of benefit accrual) under any pension benefit plan as defined in
Section 3(2) of ERISA.(c)
    
    Credited Sickness Days. If Purchaser offers a salary
continuation or similar program for employees unable to work for
medical reasons, the Branch Employees shall be credited under
any program of Purchaser with at least the number of sickness




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and/or personal benefit days accrued under Sellers program at
the Closing Date. After the Closing Date, the Branch Employees
shall accrue additional sickness and/or personal benefit days in
accordance with the terms of Purchasers program.(d)
    
    Pre-existing Condition. Purchaser agrees that any pre-existing
condition clause in any of Purchasers health or disability
insurance coverage shall not be applicable to the Branch
Employees or their dependents.(e)
    
    Severance Pay. Sellers severance policy is attached hereto as
Schedule D. Effective as of the Closing Date, Purchaser shall
assume liability for all severance benefits payable to any
Branch Employee who is terminated by Purchaser after the Closing
Date. For a period of one (1) year following the Closing Date,
Purchaser shall provide such benefit pursuant to individual
separation pay agreements entered into with each Branch Employee
on terms and conditions consistent in all respects with Sellers
severance policy (provided, however, that for purposes of
determining whether the terms of Purchasers separation pay
agreements are consistent with Sellers severance policy (i) the
second sentence of Section 2.11 of Sellers severance policy
shall be read exactly as such sentence is currently contained
therein, except that for purposes of determining whether a
position is comparable, the reference to a reduction in a Branch
Employees Base Weekly Salary (as defined under Sellers
severance policy) shall be revised to require a 12% or
greater reduction, as compared to 10% or greater reduction and
(ii) references to certain types of benefits to be paid in
addition to the separation pay benefit to be provided in
accordance with the Separation Pay Schedule included in Section
3.3(c) shall refer to those benefits offered to current
employees of the Purchaser), and Purchaser shall compute
severance benefits by giving all Branch Employees full credit
for all years of service with Seller, its affiliates, and
predecessors, in accordance with Section 4.02(b). After
the initial one-year period, Purchaser shall provide Branch
Employees with severance benefits in accordance with Purchasers
severance policy, if any, in accordance with their years of
service as credited under this Agreement.




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(f)
    
    Successor Employer. Purchaser agrees it will qualify as a
successor employer of Branch Employees for withholding tax
purposes.(g)
    
    Payment of Claims. Purchaser assumes responsibility for (I)
payment of any medical, dental, health and disability claims
incurred by Branch Employees on or after the Closing Date and
(ii) Continuation Coverage (as defined in Section 4.03(d) below)
to any Branch Employee (and each Branch Employees qualified
beneficiaries) whose qualifying event occurs on or after the
Closing Date.
  (a)
    
    Accrued Benefits. Seller agrees to remain responsible for the
payment of all accrued benefits to such Branch Employees who are
participants or retirees in accordance with the terms of
Sellers retirement income plans. Purchaser shall not at any
time assume any liability for the benefits of any active or any
terminated, vested, or retired participants whose benefit
accrued prior to the Closing Date under Sellers retirement
income plans.(b)
    
    Payment of Claims. Seller shall retain the responsibility for
payment of all medical, dental, health and disability claims
incurred by a Branch Employee prior to the Closing Date, and
Purchaser shall not assume any liability with respect to such
claims.(c)
    
    Continuation Coverage. Seller shall be responsible for
providing any Branch Employee whose qualifying event, within
the meaning of Section 4980B(f) of the Code, occurs prior to the
Closing Date (and such Branch Employees qualified
beneficiaries within the meaning of Section 4980B(g) of the
Code) with the continuation of group health coverage required by
Section 4980B(f) of the Code (Continuation Coverage) under the
terms of the health plan maintained by Seller.(d)
    
    Retired or Terminated Branch Employees. Seller agrees that it
shall retain, consistent with its normal employment practices,
all liability and obligation, if any (including, without




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limitation, the liability and obligation for all wages, salary,
vacation pay and unemployment, medical, dental, health and
disability benefits), for those former employees of the Branches
who retired or terminated employment prior to the Closing Date,
but shall in all other instances cease to have any liability for
Branch Employees with regard to the foregoing provisions on or
after the Closing Date, except as otherwise required by law.
      (a)
    
    Tax Information. Make available to the other and, subject
to attorney-client privilege, to any taxing authority as
reasonably requested all relevant information, records, and
documents relating to taxes.(b)
    
    Audits and Assessments. Provide timely notice to the other
party in writing of any pending or proposed tax audits (with
copies of all relevant correspondence received from any taxing
authority in connection with any tax audit or information
request) or assessments for taxable periods for which the other
party may have a liability.




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(a)
    
    Prior Regulatory Approval of the Transaction Contemplated
Hereby. All filings and registrations with, and notifications
to, all federal and state authorities required for consummation
of the transaction contemplated hereby and Purchasers operation
of the Branches shall have been made, all Regulatory Approvals
shall have been received and shall be in full force and effect,
and all applicable waiting periods shall have passed. A
Regulatory Approval will be deemed to have been received, and
the condition to closing set forth in this Section 6.01 shall be
deemed to have been met notwithstanding the fact that such
Regulatory Approval requires Purchaser to effect any divestiture
of any of the Branches.(b)
    
    Representations and Warranties. The representations and
warranties of the other party set forth in this Agreement shall
be true and correct in all material respects as of the Closing
Date with the same effect as though all such representations and
warranties had been made on and as of such time (unless a
different date is specifically indicated in such representations
and warranties), and each party shall have delivered to the
other a certificate, dated as of the Closing Date, to the effect
that this condition has been satisfied with respect to such
party, provided, however, that the representation of Seller set
forth in Section 3.01(i) hereof shall be deemed to be true and
correct in accordance with this Section 6.01 unless Purchaser
shall have notified Seller at least 10 days prior to the Closing
Date of any potential breach of Section 3.01(i), or within
twenty-four (24) hours of knowledge of any potential breach of
Section 3.01(i) which occurs within the 10 days prior to the
Closing Date, and Seller shall have had sufficient opportunity
to correct such potential breach.




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(c)
    
    Covenants. Each and all of the covenants and agreements of the
other party to be performed or complied with at or prior to the
Closing Date pursuant to this Agreement shall have been duly
performed or complied with in all material respects by such
party, or shall have been waived in accordance with the terms
hereof, and such party shall have delivered a certificate, dated
as of the Closing Date, to the effect that this condition has
been satisfied with respect to such party; provided, however,
that the covenant of Seller set forth in Section 2.01(a) hereof
shall be deemed to have been duly performed and complied with in
accordance with this Section 6.01(c) unless Purchaser shall have
notified Seller at least 10 days prior to the Closing Date of
any potential breach of Section 2.01(a), or within twenty-four
(24) hours of knowledge of any potential breach of Section
2.01(a) which occurs within the 10 days prior to the Closing
Date, and Seller shall have had sufficient opportunity to
correct such potential breach.(d)
    
    No Proceeding or Prohibition. At the time of the Closing, no
court or governmental or regulatory authority of competent
jurisdiction shall have enacted, issued, promulgated, enforced,
or entered any statute, rule, regulation, judgment, decree,
injunction or other order (whether temporary, preliminary or
permanent) which is in effect to restrain, enjoin, or prohibit
consummation of the transaction contemplated hereby or which
might result in rescission in connection with such transaction,
and Purchaser shall have delivered to Seller a certificate,
dated as of the Closing Date, to that effect.




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(a)
    
    Prior to the date hereof, Seller shall have provided to
Purchaser Phase I audit reports, as of a date no earlier than
January 1, 1994, undertaken by Seller with respect to the Owned
Real Estate (the Phase I Reports). Except as set forth in the
Phase I Reports, to the Knowledge of Seller, the Branches are in
compliance with all environmental laws, rules and regulations of
the United States of America and of states and localities in
which the Branches are located, except for any such
noncompliance which, individually or in the aggregate, has not
had, and is not expected to have, to the Knowledge of Seller, a
material adverse effect on the business of any Branch.(b)
    
    Except as may be set forth in the Phase I Reports, to the
Knowledge of Seller, Seller has no liability with respect to
the Branches which, taken singularly or as a whole, if adversely
determined, would have a material adverse effect on the business
of any Branch (i) relating to the handling, storage, treatment,




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use, disposal, discharge or release into the environment of any
hazardous material or waste at, on or from the Owned Real Estate
or the Leased Real Estate, (ii) for the release or emission of
any hazardous material from, on, under, or within the Owned Real
Estate or Leased Real Estate into the air, water, surface water,
ground water, land surface, or subsurface strata, (iii) for the
disposal of any hazardous material on the Owned Real Estate or
Leased Real Estate or (iv) for the contamination of the Owned
Real Estate or Leased Real Estate with any hazardous material.
  (a)
    
    If any Phase I Report indicates the presence of any hazardous
substance with respect to any Owned Real Estate, and such
presence is a condition that requires remediation pursuant to
appropriate governmental standards, then, at Purchasers request
made in writing to Seller within ten (10) days after the date of
this Agreement, and at Purchasers sole cost and expense, Seller
shall arrange to cause a consultant approved by both Seller and
Purchaser to conduct a Phase II environmental audit as to such
hazardous substance and deliver to Seller and Purchaser the
results of such audit within forty-five days after the request
by Purchaser. If the Phase II audit report confirms that such
presence requires remediation pursuant to appropriate
governmental standards and if such presence, if not remediated,
would materially adversely affect the business of the Branch
situated upon the Owned Real Estate and Purchaser requests that
Seller take remedial action with respect thereto, then
Purchaser shall so notify Seller in writing promptly after
receipt of the Phase II environmental audit report, whereupon
Seller shall have the right to (i) terminate this Agreement as
it relates to the Assets and Liabilities of the affected Branch,
(ii) undertake remedial action as to such presence at its sole
cost and expense so that no material continuing violation of any




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environmental law exists (provided, however, that the timing of
any such remediation shall be coordinated with Purchaser to
minimize any resulting business interruption), or (iii) agree to
indemnify Purchaser for all actual costs and expenses incurred
by Purchaser to remediate the Owned Real Estate as to such
presence so that no material continuing violation of any
environmental law exists.(b)
    
    If Purchaser fails to request a Phase II environmental audit or
to exercise its right to make a request that Seller remediate
any Owned Real Estate in each case as and when required above,
then Purchaser shall be bound to the terms of this Agreement
without a right of termination except as provided in Article XI
and without a further right to request or to require any Seller
remediation or indemnification. Any termination by Seller under
this Article X shall neither create nor result in any liability
of the Seller to the Purchaser.
    (a)
    
    By either Purchaser or Seller, in writing, if the Closing has
not occurred on or before the earlier of the nine (9) month
anniversary of this Agreement;(b)
    
    At any time prior to the Closing Date by the mutual consent in
writing of Purchaser and Seller;(c)
    
    By Purchaser or Seller as to the Owned Real Estate and/or
Leasehold Estate and all furniture, fixture and equipment
located thereon, all of the Assets and Liabilities relating to
the affected Branch, or as to the Agreement in its entirety, as
provided, in each case, in Section 2.04(c), 6.03 or 10.02;(d)
    
    By Purchaser in writing if and when, at any time prior to the
Closing, any condition of its obligations hereunder set forth in
Section 6.01 of this Agreement becomes incapable of being




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fulfilled and such condition has not been waived by Purchaser;(e)
    
    By Seller in writing if and when, at any time prior to the
Closing, any condition of its obligations hereunder set forth in
Section 6.01 of this Agreement becomes incapable of being
fulfilled and such condition has not been waived by Seller;(f)
    
    At any time prior to the Closing Date by Purchaser or Seller in
writing if the other continues to be in breach of any
representation and warranty (as if such representation and
warranty had been made on and as of the date of the notice of
breach referred to below unless a different time is specified in
any such representation and warranty), covenant, or agreement
in any material respect and such breach has not been cured
within twenty-five (25) days after the giving of notice to the
breaching party of such breach; or(g)
    
    By Purchaser or Seller in writing at any time after any
applicable regulatory authority has denied approval of any
application of Purchaser for approval of the transaction
contemplated hereby.




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PURCHASER:
    
    SELLER:Lorain National Bank
    
    KeyBank National AssociationBy: /s/ James F. Kidd
    
    By: /s/ Matthew M. NickelsATTEST: /s/ Gregory D. Friedman
TITLE: President & CEO
    
    ATTEST: /s/ Kathryn L. Hale
TITLE: Vice President




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Schedule A Branches to be Purchased
    
    
    S-2Schedule B Form of Preliminary Closing Statement
    
    
    S-3Schedule C Employee List
    
    
    S-4Schedule D Severance Plan
    
    
    S-5Schedule E Actions to be Taken At Closing
    
    
    S-6Attachment 1 - Instrument of Assumption
    
    
    S-7Attachment 2 - Bill of Sale and Receipt
    
    
    S-8Attachment 3 - Limited Warranty Deed for Ohio
    
    
    S-9Attachment 4 - Assignment and Assumption of Lease
    
    
    S-12Schedule F Transitional Matters
    
    
    S-14Schedule G Landlord Estoppel Certificate
    
    
    S-18Schedule H (Confidential Information)
    
    
    S-21




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LORAIN NATIONAL BANKBy: /s/ James F. KiddTitle: President & CEOKEYBANK NATIONAL ASSOCIATIONBy: /s/ Matthen M. NickelsTitle: Senior Vice President