EX-10.1



 





EXHIBIT 10.1




AGREEMENT AND PLAN OF MERGER




between




F.N.B. CORPORATION




and




OMEGA FINANCIAL CORPORATION




DATED AS OF NOVEMBER 8, 2007





 









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page
	ARTICLE I
	 	THE MERGER	 	 	1	 
	1.1
	 	The Merger	 	 	1	 
	1.2
	 	Effective Time	 	 	2	 
	1.3
	 	Effects of the Merger	 	 	2	 
	1.4
	 	Conversion of Omega Capital Stock	 	 	2	 
	1.5
	 	FNB Capital Stock	 	 	4	 
	1.6
	 	Omega Equity and Equity-Based Awards	 	 	4	 
	1.7
	 	Articles of Incorporation and Bylaws of the Surviving Company	 	 	5	 
	1.8
	 	Tax Consequences	 	 	5	 
	1.9
	 	Dissenting Shares	 	 	5	 
	1.10.
	 	The Bank Merger	 	 	5	 
	ARTICLE II
	 	EXCHANGE OF SHARES	 	 	6	 
	2.1
	 	FNB to Make Merger Consideration Available	 	 	6	 
	2.2
	 	Exchange of Shares	 	 	6	 
	2.3
	 	Adjustments for Dilution and Other Matters	 	 	8	 
	2.4
	 	Withholding Rights	 	 	9	 
	ARTICLE III
	 	REPRESENTATIONS AND WARRANTIES OF OMEGA	 	 	9	 
	3.1
	 	Corporate Organization	 	 	9	 
	3.2
	 	Capitalization	 	 	11	 
	3.3
	 	Authority; No Violation	 	 	12	 
	3.4
	 	Consents and Approvals	 	 	13	 
	3.5
	 	Reports	 	 	14	 
	3.6
	 	Financial Statements	 	 	14	 
	3.7
	 	Broker's Fees	 	 	15	 
	3.8
	 	Absence of Certain Changes or Events	 	 	15	 
	3.9
	 	Legal Proceedings	 	 	16	 
	3.10
	 	Taxes and Tax Returns	 	 	16	 
	3.11
	 	Employee Benefits	 	 	18	 
	3.12
	 	SEC Reports	 	 	21	 
	3.13
	 	Compliance with Applicable Law	 	 	22	 
	3.14
	 	Contracts	 	 	22	 
	3.15
	 	Agreements with Regulatory Agencies	 	 	22	 
	3.16
	 	Undisclosed Liabilities	 	 	23	 
	3.17
	 	Environmental Liability	 	 	23	 
	3.18
	 	Real Property	 	 	24	 
	3.19
	 	State Takeover Laws	 	 	25	 
	3.20
	 	Reorganization	 	 	25	 
	3.21
	 	Opinion	 	 	25	 






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	 	 	 	 	Page
	3.22
	 	Insurance	 	 	26	 
	3.23
	 	Investment Securities	 	 	26	 
	3.24
	 	Intellectual Property	 	 	26	 
	3.25
	 	Loans; Nonperforming and Classified Assets	 	 	26	 
	3.26
	 	Fiduciary Accounts	 	 	27	 
	3.27
	 	Allowance for Loan Losses	 	 	27	 
	ARTICLE IV
	 	REPRESENTATIONS AND WARRANTIES OF FNB	 	 	27	 
	4.1
	 	Corporate Organization	 	 	28	 
	4.2
	 	Capitalization	 	 	28	 
	4.3
	 	Authority; No Violation	 	 	29	 
	4.4
	 	Consents and Approvals	 	 	30	 
	4.5
	 	Reports	 	 	30	 
	4.6
	 	Financial Statements	 	 	31	 
	4.7
	 	Broker’s Fees	 	 	32	 
	4.8
	 	Absence of Certain Changes or Events	 	 	32	 
	4.9
	 	Legal Proceedings	 	 	32	 
	4.10
	 	Taxes and Tax Returns	 	 	32	 
	4.11
	 	Employee Benefits	 	 	34	 
	4.12
	 	SEC Reports	 	 	37	 
	4.13
	 	Compliance with Applicable Law	 	 	37	 
	4.14
	 	Contracts	 	 	37	 
	4.15
	 	Agreements with Regulatory Agencies	 	 	38	 
	4.16
	 	Undisclosed Liabilities	 	 	38	 
	4.17
	 	Environmental Liability	 	 	38	 
	4.18
	 	Reorganization	 	 	40	 
	4.19
	 	Loans; Nonperforming and Classified Assets	 	 	40	 
	4.20
	 	Fiduciary Accounts	 	 	40	 
	4.21
	 	Allowance for Loan Losses	 	 	40	 
	ARTICLE V
	 	COVENANTS RELATING TO CONDUCT OF BUSINESS	 	 	41	 
	5.1
	 	Conduct of Businesses Prior to the Effective Time	 	 	41	 
	5.2
	 	Omega Forbearances	 	 	41	 
	5.3
	 	FNB Forbearances	 	 	45	 
	5.4
	 	No Control of Other Party’s Business	 	 	46	 
	ARTICLE VI
	 	ADDITIONAL AGREEMENTS	 	 	47	 
	6.1
	 	Regulatory Matters	 	 	47	 
	6.2
	 	Access to Information	 	 	49	 
	6.3
	 	Shareholder Approval	 	 	50	 
	6.4
	 	Commercially Reasonable Efforts; Cooperation	 	 	51	 
	6.5
	 	Affiliates	 	 	51	 
	6.6
	 	NYSE Approval	 	 	51	 
	6.7
	 	Benefit Plans	 	 	51	 
	6.8
	 	Indemnification; Directors’ and Officers’ Insurance	 	 	52	 






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	 	 	 	 	Page
	6.9
	 	Additional Agreements	 	 	54	 
	6.10
	 	Advice of Changes	 	 	54	 
	6.11
	 	Dividends	 	 	54	 
	6.12
	 	Exemption from Liability Under Section 16(b)	 	 	54	 
	6.13
	 	Certain Actions	 	 	55	 
	6.14
	 	Transition	 	 	58	 
	6.15
	 	Certain Post-Closing Matters	 	 	58	 
	ARTICLE VII
	 	CONDITIONS PRECEDENT	 	 	59	 
	7.1
	 	Conditions to Each Party’s Obligation to Effect the Merger	 	 	59	 
	7.2
	 	Conditions to Obligation of FNB to Effect the Merger	 	 	60	 
	7.3
	 	Conditions to Obligation of Omega to Effect the Merger	 	 	61	 
	ARTICLE VIII
	 	TERMINATION AND AMENDMENT	 	 	61	 
	8.1
	 	Termination	 	 	61	 
	8.2
	 	Effect of Termination	 	 	64	 
	8.3
	 	Amendment	 	 	64	 
	8.4
	 	Extension; Waiver	 	 	64	 
	ARTICLE IX
	 	GENERAL PROVISIONS	 	 	65	 
	9.1
	 	Closing	 	 	65	 
	9.2
	 	Nonsurvival of Representations, Warranties and Agreements	 	 	65	 
	9.3
	 	Expenses	 	 	65	 
	9.4
	 	Notices	 	 	66	 
	9.5
	 	Interpretation	 	 	66	 
	9.6
	 	Counterparts	 	 	67	 
	9.7
	 	Entire Agreement	 	 	67	 
	9.8
	 	Governing Law; Jurisdiction	 	 	67	 
	9.9
	 	Severability	 	 	68	 
	9.10
	 	Assignment; Third Party Beneficiaries	 	 	68	 
		 		 	 		 
	EXHIBITS:
	 	 	 	 	 	 
	Exhibit A
	 	Form of Bank Merger Agreement	 	 	A-1	 
	Exhibit B
	 	Form of Affiliate Letter	 	 	B-1	 
	Exhibit C
	 	Form of Voting Agreement	 	 	C-1	 






(iii) 









 






INDEX OF DEFINED TERMS




	 	 	 
	 	 	Section
	Acquisition Proposal
	 	6.13(e)
	Affiliate
	 	2.3(g)
	Agreement
	 	Preamble
	Articles of Merger
	 	1.2
	Assumed Stock Options
	 	1.5(a)
	Average Closing Price
	 	1.4(e)
	Bank
	 	3.4
	Bank Merger
	 	1.10
	Bank Merger Agreement
	 	1.10
	BHC Act
	 	3.1(b)
	Break-up Fee
	 	6.13(f)
	Certificates
	 	1.4(c)
	Change in Omega Recommendation
	 	6.13(c)
	Claim
	 	6.8(a)
	Closing
	 	9.1
	Closing Date
	 	9.1
	Code
	 	Preamble
	Confidentiality Agreement
	 	6.2(b)
	Contracts
	 	5.2(j)
	Controlled Group Liability
	 	3.11
	Credit Facilities
	 	5.2(f)
	DRSP Plan
	 	1.4(d)
	Effective Date
	 	1.2
	Effective Time
	 	1.2
	Environmental Laws
	 	3.17(b)
	ERISA
	 	3.11
	ERISA Affiliate
	 	3.11
	ESOP
	 	1.6(c)
	Exchange Act
	 	3.6
	Exchange Agent
	 	2.2(a)
	Exchange Fund
	 	2.2
	Exchange Ratio
	 	1.4(a)
	FBCA
	 	1.1(a)
	FDIC
	 	3.4
	Federal Reserve Board
	 	3.4
	FNB
	 	Preamble
	FNB 10-Q
	 	4.6
	FNB 2006 10-K
	 	4.6






(iv) 









 







	 	 	 
	 	 	Section
	FNB Bank
	 	1.10
	FNB Bank Board
	 	1.10
	FNB Benefit Plan
	 	4.11
	FNB Bylaws
	 	4.1(b)
	FNB Charter
	 	4.1(b)
	FNB Common Stock
	 	1.4(a)
	FNB Disclosure Schedule
	 	Art.  IV Preamble
	FNB Employment Agreement
	 	4.11
	FNB Loan Property
	 	4.17
	FNB Plans
	 	6.7(a)
	FNB Preferred Stock
	 	4.2(a)
	FNB Proposal
	 	6.3(b)
	FNB Qualified Plans
	 	4.11(d)
	FNB Recommendation
	 	6.3(b)
	FNB Regulatory Agreement
	 	4.15
	FNB Reports
	 	4.12
	FNB Shareholder Meeting
	 	6.3(b)
	FNB Stock Plans
	 	4.2(a)
	GAAP
	 	3.1(c)
	Governmental Entity
	 	3.4
	Hazardous Substance
	 	3.17(b)
	HSR Act
	 	3.4
	Indemnified Parties
	 	6.8(a)
	Injunction
	 	7.1(e)
	Insurance Amount
	 	6.8(c)
	Intellectual Property
	 	3.25
	IRS
	 	3.11(b)
	Joint Proxy Statement
	 	3.4
	Leased Properties
	 	3.18(c)
	Leases
	 	3.18(b)
	Liens
	 	3.2(b)
	Loan(s)
	 	5.2(t)
	Material Adverse Effect
	 	3.1(c)
	Materially Burdensome Regulatory Condition
	 	6.1(d)
	Merger
	 	Preamble
	Merger Consideration
	 	1.4(a)
	Multiemployer Plan
	 	3.11
	Multiple Employer Plan
	 	3.11
	Nasdaq
	 	3.1(c)
	NYSE
	 	3.1(c)
	OCC
	 	3.4
	Omega
	 	Preamble






(v) 









 






	 	 	 
	 	 	Section
	Omega 10-Q
	 	3.6
	Omega 2006 10-K
	 	3.6
	Omega Advisory Board
	 	6.15(b)
	Omega Articles
	 	3.1(b)
	Omega Bank
	 	1.10
	Omega Bank Designees
	 	1.10
	Omega Benefit Plan
	 	3.11
	Omega Bylaws
	 	3.1(b)
	Omega Common Stock
	 	1.4(a)
	Omega Designees
	 	1.3(b)
	Omega Disclosure Schedule
	 	Art.  III Preamble
	Omega Employment Agreement
	 	3.11
	Omega’s Knowledge
	 	3.17(b)
	Omega Loan Property
	 	3.17(a)
	Omega Plan
	 	3.11
	Omega Qualified Plans
	 	3.11(d)
	Omega Recommendation
	 	6.3(e)
	Omega Regulatory Agreement
	 	3.15
	Omega Reports
	 	3.12
	Omega Representatives
	 	6.13(a)
	Omega RSU
	 	1.6(b)
	Omega Shareholder Meeting
	 	6.3
	Omega Stock Option
	 	1.6(a)
	Omega Stock Plans
	 	1.6(a)
	Omega Subsidiary
	 	3.1(c)
	OREO
	 	3.26(b)
	Other Regulatory Approvals
	 	3.4
	Owned Properties
	 	3.18(a)
	PA DOB
	 	3.4
	Payment Event
	 	6.13(g)
	PBCL
	 	1.1(a)
	PBGC
	 	3.11(e)
	Person
	 	3.9(a)
	Registration Statement
	 	3.4
	Regulatory Agencies
	 	3.5
	Requisite Regulatory Approvals
	 	7.1(c)
	SEC
	 	3.4
	Securities Act
	 	1.6(d)
	SRO
	 	3.4
	Subsidiary
	 	3.1(c)
	Superior Proposal
	 	6.13(e)
	Surviving Company
	 	Preamble






(vi) 









 






	 	 	 
	 	 	Section
	Tax Returns
	 	3.10(c)
	Tax(es)
	 	3.10(b)
	Third Party
	 	6.13(g)
	Third Party Leases
	 	3.18(d)
	Treasury Shares
	 	1.4(b)
	Voting Agreement
	 	Preamble
	Withdrawal Liability
	 	3.11







(vii) 









 








AGREEMENT AND PLAN OF MERGER




     AGREEMENT AND PLAN OF MERGER, dated as of November 8, 2007 (this “Agreement”), between F.N.B.
CORPORATION, a Florida corporation (“FNB “) and OMEGA FINANCIAL CORPORATION, a Pennsylvania
corporation (“Omega”).



W I T N E S S E T H:




     WHEREAS, the Boards of Directors of Omega and FNB have determined that it is in the best
interests of their respective companies and their shareholders to consummate the strategic business
combination transaction provided for in this Agreement in which Omega will, on the terms and
subject to the conditions set forth in this Agreement, merge with and into FNB (the “ Merger “), so
that FNB is the surviving company in the Merger (sometimes referred to in such capacity as the
“Surviving Company”); and



     WHEREAS, for federal income Tax (as defined in Section 3.10(b)) purposes, it is intended that
the Merger shall qualify as a reorganization under the provisions of Section 368(a) of the Internal
Revenue Code of 1986, as amended (the “Code”);



     WHEREAS, the members of the Omega Board of Directors have executed a voting agreement of even
date herewith in the form of Exhibit C (the “Voting Agreement”); and



     WHEREAS, the parties desire to make certain representations, warranties and agreements in
connection with the Merger and also to prescribe certain conditions to the Merger.



     NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and
agreements contained in this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties
agree as follows:



ARTICLE I




THE MERGER




     1.1 The Merger.



          (a) Subject to the terms and conditions of this Agreement, in accordance with the Pennsylvania
Business Corporation Law (the “PBCL”) and the Florida Business Corporation Act (the “FBCA”), at the
Effective Time (as defined in Section 1.2), Omega shall merge with and into FNB. FNB shall be the
Surviving Company in the Merger, and shall continue its corporate existence under the laws of the
State of Florida. As of the Effective Time, the separate corporate existence of Omega shall cease.




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          (b) FNB may at any time change the method of effecting the combination and Omega shall
cooperate in such efforts, including by entering into an appropriate amendment to this Agreement
(to the extent such amendment only changes the method of effecting the business combination and
does not substantively affect this Agreement or the rights and obligations of the parties or their
respective shareholders hereunder); provided, however, that no such change shall (i) alter or
change the amount or kind of the Merger Consideration (as defined in Section 1.4(a)) provided for
in this Agreement, (ii) adversely affect the Tax treatment of Omega’s shareholders as a result of
receiving the Merger Consideration or the Tax treatment of either party pursuant to this Agreement
or (iii) materially impede or delay consummation of the transactions contemplated by this
Agreement.




     1.2 Effective Time. The Merger shall become effective as set forth in the articles of
merger (the “Articles of Merger”) that shall be filed with the Secretary of State of the
Commonwealth of Pennsylvania and the Secretary of State of the State of Florida on or before the
Closing Date (as defined in Section 9.1). The term “Effective Time” shall mean the date and time
when the Merger becomes effective as set forth in the Articles of Merger. “Effective Date” shall
mean the date on which the Effective Time occurs.



     1.3 Effects of the Merger.



          (a) At and after the Effective Time, the Merger shall have the effects set forth in Sections
1921 through 1932 of the PBCL and Sections 607.1101 through 607.11101 of the FBCA.




          (b) Directors and Executive Officers of the Surviving Company. The directors of the
Surviving Company immediately after the Merger shall be (i) the directors of FNB immediately prior
to the Merger and (ii) three current independent members of Omega’s Board of Directors (the “Omega
Designees”) as are mutually agreed by FNB and Omega. The executive officers of the Surviving
Company immediately after the Merger shall be the executive officers of FNB immediately prior to
the Merger.




     1.4 Conversion of Omega Capital Stock.



          (a) Subject to the provisions of this Agreement, each share of common stock, $5.00 par value,
of Omega (“Omega Common Stock”) issued and outstanding immediately prior to the Effective Time,
other than Treasury Shares (as defined in Section 1.4(b)) shall, by virtue of the Merger, no longer
be outstanding and shall as of the Effective Time automatically be converted into and shall
thereafter represent the right to receive as merger consideration (the “Merger Consideration”)
2.022 shares (the “Exchange Ratio”) of common stock, $.01 par value, of FNB (“FNB Common Stock”).




-2-









 








          (b) At and after the Effective Time, each Treasury Share shall be cancelled and retired and no
shares of FNB Common Stock or other consideration shall be issued in exchange therefor. “Treasury
Shares” means shares of Omega Common Stock held by Omega or any of its Subsidiaries (as defined in
Section 3.1(c)) or by FNB or any of its Subsidiaries, other than in a fiduciary, including
custodial or agency, capacity or as a result of debts previously contracted in good faith.




          (c) At the Effective Time, the stock transfer books of Omega shall be closed as to holders of
Omega Common Stock immediately prior to the Effective Time and no transfer of Omega Common Stock by
any such holder shall thereafter be made or recognized. If, after the Effective Time, certificates
representing Omega Common Stock (“Certificates”) are properly presented in accordance with Section
2.2 of this Agreement to the Exchange Agent (as defined in Section 2.2(a)), such Certificates shall
be canceled and exchanged for certificates representing the number of whole shares of FNB Common
Stock into which the Omega Common Stock represented thereby was converted in the Merger, plus any
payment for any fractional share of FNB Common Stock without any interest thereon and any dividends
or distributions to which the holder of such Certificates is entitled pursuant to Section 2.2(b).




          (d) Each holder of Omega Common Stock shall have the option of enrolling the whole shares of
FNB Common Stock issuable to such shareholder upon the consummation of the Merger in FNB’s
Dividend Reinvestment and Stock Purchase Plan (the “DRSP Plan”). Each Omega shareholder electing
to enroll in the DRSP Plan shall be issued a certificate representing the number of whole shares of
FNB Common Stock received in the Merger, and any future dividends will be reinvested in accordance
with the DRSP Plan.




          (e) Notwithstanding any other provision of this Agreement, each holder of Omega Common Stock
who would otherwise be entitled to receive a fractional share of FNB Common Stock, after taking
into account all Certificates delivered by such holder, shall receive an amount in cash, without
interest, rounded to the nearest cent, equal to the product obtained by multiplying (a) the Average
Closing Price (as defined below) as of the Closing Date by (b) the fraction of a share (calculated
to the nearest ten-thousandth when expressed in decimal form) of FNB Common Stock, to which such
holder would otherwise be entitled. No such holder shall be entitled to dividends or other rights
in respect of any such fractional shares. “Average Closing Price” means, as of any specified date,
the average composite closing price of FNB Common Stock on the NYSE as reported in New York Stock
Exchange Composite Transactions in The Wall Street Journal (Eastern Edition) or, if not reported
therein, in another mutually agreed upon authoritative source, for each of the 20 consecutive
trading days ending on and including the fifth such trading day prior to the specified date rounded
to the nearest ten-thousandth.




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     1.5 FNB Capital Stock. At and after the Effective Time, each share of FNB capital
stock issued and outstanding immediately prior to the Effective Time shall remain issued and
outstanding and shall not be affected by the Merger.



     1.6 Omega Equity and Equity-Based Awards.



          (a) Omega Stock Options. Effective as of the Effective Time, each then outstanding
option to purchase shares of Omega Common Stock (each an “Omega Stock Option”), pursuant to the
equity-based compensation plans identified on Section 3.11(a) of the Omega Disclosure Schedule (as
defined in Article III) (the “Omega Stock Plans”) and the award agreements evidencing the grants
thereunder, granted to any current or former employee or director of, or consultant to, Omega or
any of its Subsidiaries (as defined in Section 3.1(b)) shall at the Effective Time cease to
represent a right to acquire shares of Omega Common Stock and shall be converted automatically into
an option to acquire shares of FNB Common Stock and each option to acquire shares of Omega Common
Stock that prior to the Effective Time is fully vested and exercisable, shall continue as a fully
vested and exercisable option of FNB on the terms hereinafter set forth. FNB shall assume each
such Omega Stock Option in accordance with the terms of the relevant Omega Stock Plan and stock
option or other agreement by which it is evidenced, except that from and after the Effective Time:
(i) FNB and the Compensation Committee of its Board of Directors shall be substituted for Omega and
the committee of the Board of Directors of Omega, including, if applicable, the entire Board of
Directors of Omega, administering such Omega Stock Plan, (ii) each Omega Stock Option assumed by
FNB may be exercised solely for shares of FNB Common Stock, (iii) the number of shares of FNB
Common Stock subject to such Omega Stock Option shall be equal to the number of shares of Omega
Common Stock subject to such Omega Stock Option immediately prior to the Effective Time multiplied
by the Exchange Ratio, provided that any fractional shares of FNB Common Stock resulting from such
multiplication shall be rounded down to the nearest share, and (iv) the exercise price per share of
FNB Common Stock under each such option shall be the amount (rounded up to the nearest whole cent)
equal to the per share exercise price under each such Omega Stock Option prior to the Effective
Time divided by the Exchange Ratio. Notwithstanding clauses (iii) and (iv) of the preceding
sentence, each Omega Stock Option that is an “incentive stock option” shall be adjusted as required
by Section 424 of the Code, and the regulations promulgated thereunder, so as not to constitute a
modification, extension or renewal of the option within the meaning of Section 424(h) of the Code.
FNB and Omega agree to take all necessary steps to effect the provisions of this Section 1.6(a).
As of the Effective Time, FNB shall issue to each holder of each outstanding Omega Stock Option
that has been assumed by FNB (the “Assumed Stock Options”) a document evidencing the conversion and
assumption of such Omega Stock Option by FNB pursuant to this Section 1.6(a).




          (b) Omega Restricted Stock Units. Effective immediately prior to the Effective Time,
each then outstanding restricted stock unit (each an “Omega RSU”), pursuant



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to the Omega Stock Plans and the award agreements evidencing the grants thereunder, granted to
any current or former employee of Omega or any of its Subsidiaries shall become vested in full. At
the Effective Time, each holder of an Omega RSU shall be entitled to receive a number of shares of
FNB Common Stock equal to the Exchange Ratio multiplied by the total number of shares of Omega
Common Stock subject to such Omega RSU.




          (c) Omega Employee Stock Ownership Plan. If requested by FNB, Omega agrees that its
Employee Stock Ownership Plan (the “ESOP”) shall terminate as of a date not later than March 31,
2008 and, in connection therewith, repay all indebtedness of the ESOP. Appropriate distributions
of all of the assets held by the ESOP will be made to the participants in the ESOP as soon as
reasonably practicable thereafter in accordance with the provisions of the ESOP and applicable law.




          (d) Omega 401(k) Plan. Not later than the day prior to the Closing Date, Omega agrees
to terminate its Section 401(k) Plan.




          (e) Reservation of Shares. FNB has taken all corporate action necessary to reserve
for issuance a sufficient number of shares of FNB Common Stock issuable upon the exercise of the
Assumed Stock Options. As soon as practicable following the Closing (as defined in Section 9.1),
FNB shall file a registration statement on an appropriate form or a post-effective amendment to a
previously filed registration statement under the Securities Act of 1933, as amended (the
“Securities Act”) with respect to the issuance of the shares of FNB Common Stock subject to the
Assumed Stock Options and shall use its best efforts to maintain the effectiveness of such
registration statement or registration statements (and maintain the current status of the
prospectus or prospectuses contained therein) for so long as such equity awards remain outstanding.




     1.7 Articles of Incorporation and Bylaws of the Surviving Company. FNB’s Charter (as
defined in Section 4.1(b)) as in effect immediately prior to the Effective Time shall be the
articles of incorporation of the Surviving Company until thereafter amended in accordance with
applicable law. FNB’s Bylaws (as defined in Section 4.1(b)) as in effect immediately prior to the
Effective Time shall be the bylaws of the Surviving Company until thereafter amended in accordance
with applicable law.



     1.8 Tax Consequences. It is intended that the Merger shall constitute a
“reorganization” within the meaning of Section 368(a) of the Code, and that this Agreement shall
constitute a “plan of reorganization” for purposes of Sections 354 and 361 of the Code.



     1.9 Dissenting Shares. No outstanding shares of Omega Common Stock shall have any
dissenters’ rights of appraisal under the PBCL.



     1.10 The Bank Merger. As soon as practicable after the execution of this Agreement,
Omega and FNB shall cause Omega Bank (“Omega Bank”) and First National Bank of



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Pennsylvania (“FNB Bank”) to enter into a bank merger agreement, the form of which is attached
hereto as Exhibit A (the “Bank Merger Agreement”), that provides for the merger of Omega Bank with
and into FNB Bank (the “Bank Merger”), in accordance with applicable laws and regulations and the
terms of the Bank Merger Agreement and as soon as practicable after consummation of the Merger.
The Bank Merger Agreement provides that the directors of FNB Bank (the “FNB Bank Board”) upon
consummation of the Bank Merger shall be the directors of FNB Bank immediately prior to the Bank
Merger plus the four Omega Bank Designees as defined in Section 6.15(b).



ARTICLE II




EXCHANGE OF SHARES




     2.1 FNB to Make Merger Consideration Available. As promptly as practicable following
the Effective Time, FNB shall deposit, or shall cause to be deposited, with the Exchange Agent, for
the benefit of the holders of Certificates, for exchange in accordance with this Article II, (i)
certificates representing the aggregate number of shares of FNB Common Stock issuable pursuant to
this Agreement in exchange for shares of Omega Common Stock outstanding immediately prior to the
Effective Time of the Merger, (ii) immediately available funds equal to any dividends or
distributions payable in accordance with Section 2.2(b) and (iii) cash in lieu of any fractional
shares (such cash and certificates for shares of FNB Common Stock, collectively being referred to
as the “Exchange Fund”), to be issued pursuant to Section 1.4 and paid pursuant to Section 1.4 in
exchange for outstanding shares of Omega Common Stock.



     2.2 Exchange of Shares.



          (a) As soon as practicable after the Effective Time, Registrar and Transfer Company (the
“Exchange Agent”) shall mail to each holder of record of Omega Common Stock a letter of transmittal
in customary form as prepared by FNB and reasonably acceptable to Omega which shall specify, among
other things, that delivery shall be effected, and risk of loss and title to the Certificates shall
pass, only upon delivery of the Certificates to the Exchange Agent and instructions for use in
effecting the surrender of the Certificates in exchange for the Merger Consideration and any cash
in lieu of fractional shares into which the shares of Omega Common Stock represented by such
Certificate or Certificates shall have been converted pursuant to this Agreement and any dividends
or distributions to which such holder is entitled pursuant to Section 2.2(b). After the Effective
Time of the Merger, each holder of a Certificate formerly representing Omega Common Stock, other
than Treasury Shares, who surrenders or has surrendered such Certificate or customary affidavits
and indemnification regarding the loss or destruction of such Certificate, together with duly
executed transmittal materials to the Exchange Agent, shall, upon acceptance thereof, be entitled
to a certificate representing FNB Common Stock into which the shares of Omega Common Stock shall
have been converted pursuant to Section 1.4, as well as any cash in lieu



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of any fractional share of FNB Common Stock to which such holder would otherwise be entitled
and any dividends or distributions to which such holder is entitled pursuant to Section 2.2(b).
The Exchange Agent shall accept such Certificate upon compliance with such reasonable and customary
terms and conditions as the Exchange Agent may impose to effect an orderly exchange thereof in
accordance with normal practices. Until surrendered as contemplated by this Section 2.2, each
Certificate representing Omega Common Stock shall be deemed from and after the Effective Time of
the Merger to evidence only the right to receive the Merger Consideration any cash in lieu of
fractional shares into which the shares of Omega Common Stock represented by such Certificate or
Certificates shall have been converted pursuant to this Agreement and any dividends or
distributions to which such holder is entitled pursuant to Section 2.2(b). FNB shall not be
obligated to deliver the Merger Consideration or any check representing cash in lieu of fractional
shares and/or declared but unpaid dividends to which any former holder of Omega Common Stock is
entitled as a result of the Merger until such holder surrenders his Certificate or Certificates for
exchange as provided in this Section 2.2. If any certificate for shares of FNB Common Stock, or
any check representing cash in lieu of fractional shares and/or declared but unpaid dividends, is
to be issued in a name other than that in which a Certificate surrendered for exchange is issued,
the Certificate so surrendered shall be properly endorsed and otherwise in proper form for transfer
and the person requesting such exchange shall affix any requisite stock transfer tax stamps to the
Certificate surrendered or provide funds for their purchase or establish to the satisfaction of the
Exchange Agent that such taxes are not payable.




          (b) Following surrender of any such Certificate, there shall be paid to the record holder of
the Certificates representing whole shares of FNB Common Stock issued in exchange therefor, without
interest, (i) at the time of such surrender, the amount of any dividends or distributions with a
record date prior to the Effective Date which have been declared by Omega in respect of shares of
Omega Common Stock after the date of this Agreement in accordance with the terms of this Agreement
and which remain unpaid at the Effective Time, (ii) at the time of such surrender, the amount of
any cash payable in lieu of a fractional share of FNB Common Stock to which such holder is entitled
pursuant to Section 1.4 and the amount of dividends or other distributions with a record date after
the Effective Time of the Merger and which theretofore had become payable with respect to such
whole shares of FNB Common Stock, and (iii) at the appropriate payment date, the amount of
dividends or other distributions with a record date after the Effective Time of the Merger but
prior to surrender and a payment date subsequent to surrender payable with respect to such whole
shares of FNB Common Stock. After the date of this Agreement, Omega shall coordinate with FNB the
declaration of any dividends in respect of Omega Common Stock as provided in Section 6.11.




          (c) After the Effective Time, there shall be no transfers on the stock transfer books of Omega
of the shares of Omega Common Stock that were issued and outstanding immediately prior to the
Effective Time other than to settle transfers of Omega Common



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Stock that occurred prior to the Effective Time. If, after the Effective Time, Certificates
are presented to FNB for any reason, they shall be canceled and exchanged as provided in this
Agreement. All shares of FNB Common Stock and cash in lieu of fractional shares and/or declared
but unpaid dividends issued upon the surrender for exchange of shares of Omega Common Stock or the
provision of customary affidavits and indemnification for lost or mutilated Certificates in
accordance with the terms hereof and the letter of transmittal, shall be deemed to have been issued
in full satisfaction of all rights pertaining to such shares of Omega Common Stock.




          (d) Any portion of the Exchange Fund, including any interest thereon, that remains
undistributed to the shareholders of Omega following the passage of 12 months after the Effective
Time of the Merger shall be delivered to FNB, upon demand, and any shareholders of Omega who have
not theretofore complied with this Section 2.3 shall thereafter look only to FNB for payment of
their claim for FNB Common Stock, any cash in lieu of fractional shares of FNB Common Stock and any
unpaid dividends or distributions payable in accordance with Section 2.2(b).




          (e) Neither Omega nor FNB shall be liable to any holder of shares of Omega Common Stock or FNB
Common Stock, as the case may be, for such shares, or dividends or distributions with respect
thereto, or cash from the Exchange Fund delivered to a public official pursuant to any applicable
abandoned property, escheat or similar law.




          (f) The Exchange Agent shall not be entitled to vote or exercise any rights of ownership with
respect to the shares of FNB Common Stock held by it from time to time hereunder, except that it
shall receive and hold all dividends or other distributions paid or distributed with respect to
such shares of FNB Common Stock for the account of the Persons entitled thereto.




          (g) Certificates surrendered for exchange by any Person constituting an Affiliate of Omega for
purposes of Rule 144(a) and Rule 145 (an “Affiliate”) under the Securities Act shall not be
exchanged for certificates representing whole shares of FNB Common Stock until FNB has received a
written agreement from such person as provided in Section 6.5.




     2.3 Adjustments for Dilution and Other Matters. If prior to the Effective Time of the
Merger, (a) FNB shall declare a stock dividend or distribution on FNB Common Stock with a record
date prior to the Effective Time of the Merger, or subdivide, split up, reclassify or combine FNB
Common Stock, or make a distribution other than a regular quarterly cash dividend not in excess of
$.30 per share, on FNB Common Stock in any security convertible into FNB Common Stock, in each case
with a record date prior to the Effective Time of the Merger, or (b) the outstanding shares of FNB
Common Stock shall have been increased, decreased, changed into or exchanged for a different number
or kind of shares or securities, in each case as a result of a reorganization, recapitalization,
reclassification, stock dividend,



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stock split, reverse stock split or other similar change in FNB’s capitalization other than a
business combination transaction with another bank holding company or financial services company,
then a proportionate adjustment or adjustments will be made to the Exchange Ratio, which adjustment
may include, as appropriate, the issuance of securities, property or cash on the same basis as that
on which any of the foregoing shall have been issued, distributed or paid to holders of FNB Common
Stock generally.



     2.4 Withholding Rights. The Exchange Agent or, subsequent to the first anniversary of
the Effective Time, FNB, shall be entitled to deduct and withhold from any cash portion of the
Merger Consideration, any cash in lieu of fractional shares of FNB Common Stock, cash dividends or
distributions payable pursuant to Section 2.2(b) and any other cash amounts otherwise payable
pursuant to this Agreement to any holder of Omega Common Stock such amounts as the Exchange Agent
or FNB, as the case may be, is required to deduct and withhold under the Code, or any provision of
state, local or foreign Tax law, with respect to the making of such payment. To the extent the
amounts are so withheld by the Exchange Agent or FNB, as the case may be, such withheld amounts
shall be treated for all purposes of this Agreement as having been paid to the holder of shares of
Omega Common Stock in respect of whom such deduction and withholding was made by the Exchange Agent
or FNB, as the case may be.



ARTICLE III




REPRESENTATIONS AND WARRANTIES OF OMEGA




     Except as disclosed in the Omega Reports (as defined in Section 3.12) or as disclosed in the
disclosure schedule delivered by Omega to FNB (the “Omega Disclosure Schedule”), Omega hereby
represents and warrants to FNB as follows:



     3.1 Corporate Organization.



          (a) Omega is a corporation duly organized, validly existing and in good standing under the
laws of the Commonwealth of Pennsylvania. Omega has the corporate power and authority to own or
lease all of its properties and assets and to carry on its business as it is now being conducted,
and is duly licensed or qualified to do business in each jurisdiction in which the nature of the
business conducted by it or the character or location of the properties and assets owned or leased
by it makes such licensing or qualification necessary.




          (b) Omega is duly registered as a bank holding company and is a financial holding company
under the Bank Holding Company Act of 1956, as amended (the “BHC Act”). True and complete copies
of the Amended and Restated Articles of Incorporation of Omega (the “Omega Articles”) and the
Amended and Restated Bylaws of Omega (the




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“Omega Bylaws”), as in effect as of the date of this Agreement, have previously been made
available to FNB.




          (c) Each of Omega’s Subsidiaries (i) is duly organized and validly existing under the laws of
its jurisdiction of organization, (ii) is duly qualified to do business and in good standing in all
jurisdictions (whether federal, state, local or foreign) where its ownership or leasing of property
or the conduct of its business requires it to be so qualified and (iii) has all requisite corporate
power and authority to own or lease its properties and assets and to carry on its business as now
conducted, except in each of (i) – (iii) as would not be reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on Omega. As used in this Agreement,
(i) the word “Subsidiary” when used with respect to either party, means any corporation,
partnership, joint venture, limited liability company or any other entity (A) of which such party
or a subsidiary of such party is a general partner or (B) at least a majority of the securities or
other interests of which having by their terms ordinary voting power to elect a majority of the
board of directors or persons performing similar functions with respect to such entity is directly
or indirectly owned by such party and/or one or more subsidiaries thereof, and the terms “Omega
Subsidiary” and “FNB Subsidiary” shall mean any direct or indirect Subsidiary of Omega or FNB,
respectively, and (ii) the term “Material Adverse Effect” means, with respect to FNB, Omega or the
Surviving Company, as the case may be, any event, circumstance, development, change or effect that
alone or in the aggregate with other events, circumstances, developments, changes or effects (A) is
materially adverse to the business, results of operations or financial condition of such party and
its Subsidiaries taken as a whole (provided, however, that, with respect to this clause (A),
Material Adverse Effect shall not be deemed to include effects to the extent resulting from (1)
changes, after the date hereof, in U.S. generally accepted accounting principles (“GAAP”) or
regulatory accounting requirements applicable to banks or savings associations and their holding
companies generally; (2) changes, after the date hereof, in laws, rules or regulations of general
applicability or interpretations thereof by courts or Governmental Entities (as defined in Section
3.4); (3) actions or omissions of (a) FNB, or (b) Omega, taken at the request of, or with the prior
written consent of the other or required hereunder; (4) changes, events or developments, after the
date hereof, in the national or world economy or financial or securities markets generally or
changes, events or developments, after the date hereof in general economic conditions or other
changes, events or developments, after the date hereof that affect banks or their holding companies
generally except to the extent that such changes have a materially disproportionate adverse effect
on such party relative to other similarly situated participants in the markets or industries in
which they operate; (5) consummation or public disclosure of the transactions contemplated hereby
(including the resignation of employment of employees or any impact on such party’s business,
customer relations, condition or results of operations, in each case as a result therefrom); (6)
any outbreak or escalation of war or hostilities, any occurrence or threats of terrorist acts or
any armed hostilities associated therewith and any national or international calamity, disaster or
emergency or any escalation thereof; (7) any changes in interest rates or



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foreign currency rates; (8) any claim, suit, action, audit, arbitration, investigation,
inquiry or other proceeding or order which in any manner challenges, seeks to prevent, enjoin,
alter or delay, or seeks damages as a result of or in connection with, the transactions
contemplated hereby; (9) any failure by such party to meet any published (whether by such party or
a third party research analyst) or internally prepared estimates of revenues or earnings; (10) a
decline in the price, or a change in the trading volume of, such party’s common stock on the Nasdaq
Global Select Market (including any successor exchange, “Nasdaq”) or the New York Stock Exchange
(including any successor exchange, “NYSE”), as applicable; and (11) any matter to the extent that
(i) it is disclosed in reasonable detail in the party’s disclosure schedules delivered to the other
party pursuant to this Agreement or in such party’s SEC reports referenced in Section 3.12 or
Section 4.12, as applicable, and (ii) such disclosed matter does not worsen in a materially adverse
manner); or (B) materially delays or impairs the ability of such party to timely consummate the
transactions contemplated by this Agreement.




     3.2 Capitalization.



          (a) The authorized capital stock of Omega consists of 25,000,000 shares of Omega Common Stock,
of which, as of September 30, 2007, 12,632,627 shares were issued and outstanding, and 5,000,000
shares of preferred stock, par value $5.00 per share, of which as of the date hereof, no shares
were issued and outstanding. As of September 30, 2007, 234,616 shares of Omega Common Stock were
held in Omega’s treasury. As of September 30, 2007, no shares of Omega Common Stock were reserved
for issuance except for 500,794 shares of Omega Common Stock reserved for issuance upon the
exercise of Omega Stock Options and Omega RSUs issued pursuant to the Omega Stock Plans. All of
the issued and outstanding shares of Omega Common Stock have been, and all shares of Omega Common
Stock that may be issued upon the exercise of the Omega Stock Options will be, when issued in
accordance with the terms thereof, duly authorized and validly issued and are fully paid,
nonassessable and free of preemptive rights, with no personal liability attaching to the ownership
thereof. Except pursuant to this Agreement and the Omega Stock Plans, Omega does not have and is
not bound by any outstanding subscriptions, options, warrants, calls, commitments or agreements of
any character calling for the purchase or issuance of any shares of Omega Common Stock or any other
equity securities of Omega or any securities representing the right to purchase or otherwise
receive any shares of Omega Common Stock. Set forth in Section 3.2 of the Omega Disclosure
Schedule is a true, correct and complete list of (a) each Omega Stock Option (such list to include
the Omega Stock Plan under which such options were issued, the number of shares of Omega Common
Stock subject thereto, the vesting schedule thereof and the exercise prices thereof) and (b) each
Omega RSU (such list to include the number of shares of Omega Common Stock subject thereto and the
vesting schedule thereof) outstanding under the Omega Stock Plans as of September 30, 2007. Since
September 30, 2007 through the date hereof, Omega has not issued or awarded, or authorized the
issuance or award of, any options, restricted stock units or other equity-based awards under the
Omega Stock Plans.




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          (b) All of the issued and outstanding shares of capital stock or other equity ownership
interests of each Subsidiary of Omega are owned by Omega, directly or indirectly, free and clear of
any material liens, pledges, charges and security interests and similar encumbrances (other than
liens for property Taxes not yet due and payable, “Liens”), and all of such shares or equity
ownership interests are duly authorized and validly issued and are fully paid, nonassessable and
free of preemptive rights. No such Subsidiary has or is bound by any outstanding subscriptions,
options, warrants, calls, commitments or agreements of any character calling for the purchase or
issuance of any shares of capital stock or any other equity security of such Subsidiary or any
securities representing the right to purchase or otherwise receive any shares of capital stock or
any other equity security of such Subsidiary.




     3.3 Authority; No Violation.



          (a) Omega has full corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby have been duly and validly approved by the
Board of Directors of Omega. The Board of Directors of Omega has determined that this Agreement
and the transactions contemplated hereby are in the best interests of Omega and its shareholders
and has directed that this Agreement and the transactions contemplated by this Agreement be
submitted to Omega’s shareholders for approval and adoption at a duly held meeting of such
shareholders and, except for the approval and adoption of this Agreement and the transactions
contemplated by this Agreement by the affirmative vote of a majority of the votes cast by all
holders of shares of Omega Common Stock at such meeting at which a quorum is present, no other
corporate proceedings on the part of Omega are necessary to approve this Agreement or to consummate
the transactions contemplated hereby. This Agreement has been duly and validly executed and
delivered by Omega and, assuming due authorization, execution and delivery by FNB, constitutes the
valid and binding obligation of Omega, enforceable against Omega in accordance with its terms,
except as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws
affecting the rights of creditors generally and the availability of equitable remedies.




          (b) Neither the execution and delivery of this Agreement by Omega nor the consummation by
Omega of the transactions contemplated hereby, nor compliance by Omega with any of the terms or
provisions of this Agreement, will (i) violate any provision of the Omega Articles or the Omega
Bylaws or (ii) assuming that the consents, approvals and filings referred to in Section 3.4 are
duly obtained and/or made, (A) violate any statute, code, ordinance, rule, regulation, judgment,
order, writ, decree or Injunction (as defined in Section 7.1(e)) applicable to Omega, any of its
Subsidiaries or any of their respective properties or assets, or (B) violate, conflict with, result
in a breach of any provision of or the loss of any benefit under, constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default) under, result in the
termination of or a right of termination or



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cancellation under, accelerate the performance required by, or result in the creation of any
Lien upon any of the respective properties or assets of Omega or any of its Subsidiaries under, any
of the terms, conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which Omega or any of its
Subsidiaries is a party, or by which they or any of their respective properties or assets may be
bound or affected, except for such violations, conflicts, breaches or defaults with respect to
clause (ii) that are not reasonably likely to have, either individually or in the aggregate, a
Material Adverse Effect on Omega.




     3.4 Consents and Approvals. Except for (i) the filing of applications and notices, as
applicable, with the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”)
under the BHC Act and the Federal Reserve Act, as amended, and approval of such applications and
notices, and, in connection with the merger of Omega Bank with and into FNB Bank, the filing of
applications and notices, as applicable, with the Federal Deposit Insurance Corporation (the
“FDIC”), the Office of the Comptroller of the Currency (the “OCC”) or the Pennsylvania Department
of Banking (the “PA DOB”) and the Federal Reserve Board, and approval of such applications and
notice, (ii) the filing of any required applications or notices with any foreign or state banking,
insurance or other regulatory authorities and approval of such applications and notices (the “Other
Regulatory Approvals”), (iii) the filing with the Securities and Exchange Commission (the “SEC”) of
a joint proxy statement in definitive form relating to the meetings of Omega’s and FNB’s
shareholders to be held in connection with this Agreement (the “Joint Proxy Statement”) and the
transactions contemplated by this Agreement and of a registration statement on Form S-4 (the
“Registration Statement”) in which the Joint Proxy Statement will be included as a prospectus, and
declaration of effectiveness of the Registration Statement, (iv) the filing of the Articles of
Merger with and the acceptance for record by the Secretary of State of the Commonwealth of
Pennsylvania pursuant to the PBCL and the filing of the Articles of Merger with and the acceptance
for record by the Secretary of State of the State of Florida pursuant to the FBCA, (v) any notices
or filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR
Act”), (vi) any consents, authorizations, approvals, filings or exemptions in connection with
compliance with the applicable provisions of federal and state securities laws relating to the
regulation of broker-dealers, investment advisers or transfer agents and the rules and regulations
thereunder and of any applicable industry self-regulatory organization (“SRO”), and the rules of
Nasdaq or the NYSE, or that are required under consumer finance, mortgage banking and other similar
laws, (vii) such filings and approvals as are required to be made or obtained under the securities
or “Blue Sky” laws of various states in connection with the issuance of the shares of FNB Common
Stock pursuant to this Agreement and approval of the listing of such FNB Common Stock on the NYSE,
(viii) the adoption of this Agreement by the requisite vote of shareholders of Omega and (ix)
filings, if any, required as a result of the particular status of FNB, no consents or approvals of
or filings or registrations with any court, administrative agency or commission or other
governmental authority or instrumentality or SRO (each a



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“Governmental Entity”) are necessary in connection with (A) the execution and delivery by
Omega of this Agreement and (B) the consummation by Omega of the Merger and the other transactions
contemplated by this Agreement.




     3.5 Reports. Omega and each of its Subsidiaries have in all material respects timely
filed all reports, registrations and statements, together with any amendments required to be made
with respect thereto, that they were required to file since January 1, 2005 with (i) the Federal
Reserve Board, (ii) the Federal Deposit Insurance Corporation, (iii) any state regulatory
authority, (iv) the SEC, (v) any foreign regulatory authority and (vi) any SRO (collectively,
“Regulatory Agencies”) and with each other applicable Governmental Entity, and all other reports
and statements required to be filed by them since January 1, 2005, including any report or
statement required to be filed pursuant to the laws, rules or regulations of the United States, any
state, any foreign entity, or any Regulatory Agency, and have paid all fees and assessments due and
payable in connection therewith. Except for normal examinations conducted by a Regulatory Agency
in the ordinary course of the business of Omega and its Subsidiaries, no Regulatory Agency has
initiated or has pending any proceeding or, to the knowledge of Omega, investigation into the
business or operations of Omega or any of its Subsidiaries since January 1, 2005. There (i) is no
unresolved violation, criticism or exception by any Regulatory Agency with respect to any report or
statement relating to any examinations or inspections of Omega or any of its Subsidiaries and (ii)
has been no formal or informal inquiries by, or disagreements or disputes with, any Regulatory
Agency with respect to the business, operations, policies or procedures of Omega since January 1,
2005.



     3.6 Financial Statements.



          (a) (i) Omega has previously made available to FNB copies of the consolidated balance sheets
of Omega and its Subsidiaries as of December 31, 2004, 2005 and 2006, and the related consolidated
statements of income, shareholders’ equity and cash flows for the years then ended as reported in
Omega’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (as amended prior to
the date hereof, the “Omega 2006 10-K”) filed with the SEC under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), accompanied by the audit reports of Ernst & Young LLP,
independent registered public accountants with respect to Omega for the years ended December 31,
2004, 2005 and 2006, and (ii) Omega will make available to FNB when filed with the SEC copies of
the unaudited consolidated balance sheets of Omega and its Subsidiaries as of September 30, 2006
and 2007, and the related consolidated statements of income, shareholders equity and cash flows of
the three- and nine-month periods then ended, as reported in Omega’s Quarterly Report on Form 10-Q
for the quarterly period ended September 30, 2007 (the “Omega 10-Q”). The December 31, 2006
consolidated balance sheet of Omega (including the related notes, where applicable) fairly presents
in all material respects the consolidated financial position of Omega and its Subsidiaries as of
the date thereof, and the other financial



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statements referred to in this Section 3.6 (including the related notes, where applicable)
fairly present in all material respects the results of the consolidated operations, cash flows and
changes in shareholders equity and consolidated financial position of Omega and its Subsidiaries
for the respective fiscal periods or as of the respective dates therein set forth, subject to
normal year-end audit adjustments in amounts consistent with past experience in the case of
unaudited statements; each of such statements (including the related notes, where applicable)
complies in all material respects with applicable accounting requirements and with the published
rules and regulations of the SEC with respect thereto; and each of such statements (including the
related notes, where applicable) has been prepared in all material respects in accordance with GAAP
consistently applied during the periods involved, except, in each case, as indicated in such
statements or in the notes thereto. The books and records of Omega and its Subsidiaries have been,
and are being, maintained in all material respects in accordance with GAAP and any other applicable
legal and accounting requirements and reflect only actual transactions.




          (b) No agreement pursuant to which any loans or other assets have been or shall be sold by
Omega or its Subsidiaries entitled the buyer of such loans or other assets, unless there is
material breach of a representation or covenant by Omega or its Subsidiaries, to cause Omega or its
Subsidiaries to repurchase such loan or other asset or the buyer to pursue any other form of
recourse against Omega or its Subsidiaries. To the knowledge of Omega, there has been no material
breach of a representation or covenant by Omega or its Subsidiaries in any such agreement. Except
as disclosed in Omega Reports (as defined in Section 3.12), since January 1, 2005, no cash, stock
or other dividend or any other distribution with respect to the capital stock of Omega or any of
its Subsidiaries has been declared, set aside or paid. Except as disclosed in Omega Reports, no
shares of capital stock of Omega have been purchased, redeemed or otherwise acquired, directly or
indirectly, by Omega since January 1, 2005, and no agreements have been made to do the foregoing.




     3.7 Broker’s Fees. Neither Omega nor any Omega Subsidiary nor any of their respective
officers or directors has employed any broker or finder or incurred any liability for any broker’s
fees, commissions or finder’s fees in connection with the Merger or related transactions
contemplated by this Agreement, other than Keefe, Bruyette & Woods, Inc.



     3.8 Absence of Certain Changes or Events. Since December 31, 2006, except as publicly
disclosed in the Forms 10-K, 10-Q and 8-K and any registration statements, proxy statements or
prospectuses comprising the Omega Reports filed on or prior to the date of this Agreement, (i)
Omega and its Subsidiaries have (except in connection with the negotiation and execution and
delivery of this Agreement) carried on their respective businesses in all material respects in the
ordinary course consistent with past practice and (ii) there has not been any Material Adverse
Effect with respect to Omega.



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     3.9 Legal Proceedings.



          (a) There is no pending, or, to Omega’s knowledge, threatened, litigation, action, suit,
proceeding, investigation or arbitration by any individual, partnership, corporation, trust, joint
venture, organization or other entity (each, a “Person”) or Governmental Entity that is material to
Omega and its Subsidiaries, taken as a whole, in each case with respect to Omega or any of its
Subsidiaries or any of their respective properties or permits, licenses or authorizations.




          (b) There is no material Injunction, judgment, or regulatory restriction (other than those of
general application that apply to similarly situated financial or bank holding companies or their
Subsidiaries) imposed upon Omega, any of its Subsidiaries or the assets of Omega or any of its
Subsidiaries.




     3.10 Taxes and Tax Returns.



          (a) Each of Omega and its Subsidiaries has duly and timely filed (including all applicable
extensions) all Tax Returns (as defined in subsection (c), below) required to be filed by it on or
prior to the date of this Agreement (all such Tax Returns being accurate and complete in all
material respects), has timely paid or withheld and timely remitted all Taxes shown thereon as
arising and has duly and timely paid or withheld and timely remitted all Taxes (whether or not
shown on any Tax Return) that are due and payable or claimed to be due from it by a Governmental
Entity other than Taxes that (i) are being contested in good faith, which have not been finally
determined, and (ii) have been adequately reserved against in accordance with GAAP on Omega’s most
recent consolidated financial statements. All required estimated Tax payments sufficient to avoid
any underpayment penalties or interest have been made by or on behalf of each of Omega and its
Subsidiaries. Neither Omega nor any of its Subsidiaries has granted any extension or waiver of the
limitation period for the assessment or collection of Tax that remains in effect. There are no
disputes, audits, examinations or proceedings in progress or pending (including any notice received
of an intent to conduct an audit or examination), or claims asserted, for Taxes upon Omega or any
of its Subsidiaries. No claim has been made by a Governmental Entity in a jurisdiction where Omega
or any of its Subsidiaries has not filed Tax Returns such that Omega or any of its Subsidiaries is
or may be subject to taxation by that jurisdiction. All deficiencies asserted or assessments made
as a result of any examinations by any Governmental Entity of the Tax Returns of, or including,
Omega or any of its Subsidiaries have been fully paid. No issue has been raised by a Governmental
Entity in any prior examination or audit of each of Omega and its Subsidiaries which, by
application of the same or similar principles, could reasonably be expected to result in a proposed
deficiency in respect of such Governmental Entity for any subsequent taxable period. There are no
Liens for Taxes (other than statutory liens for Taxes not yet due and payable) upon any of the
assets of Omega or any of its Subsidiaries. Neither Omega nor any of its Subsidiaries is a party
to or is bound by any Tax sharing, allocation or indemnification agreement or arrangement (other
than such an agreement or arrangement



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exclusively between or among Omega and its Subsidiaries). Neither Omega nor any of its
Subsidiaries (A) has been a member of an affiliated group filing a consolidated federal income Tax
Return (other than a group the common parent of which was Omega) or (B) has any liability for the
Taxes of any Person (other than Omega or any of its Subsidiaries) under Treas. Reg. §1.1502-6 (or
any similar provision of state, local or foreign law), or as a transferee or successor, by contract
or otherwise. Neither Omega nor any of its Subsidiaries has been, within the past two years or
otherwise as part of a “plan (or series of related transactions)” (within the meaning of Section
355(e) of the Code) of which the Merger is also a part, or a “distributing corporation” or a
“controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution
of stock intended to qualify for tax-free treatment under Section 355 of the Code. No share of
Omega Common Stock is owned by a Subsidiary of Omega. Omega is not and has not been a “United
States real property holding company” within the meaning of Section 897(c)(2) of the Code during
the applicable period specified in Section 897(c)(1)(A)(ii) of the Code. Neither Omega, its
Subsidiaries nor any other Person on their behalf has executed or entered into any written
agreement with, or obtained or applied for any written consents or written clearances or any other
Tax rulings from, nor has there been any written agreement executed or entered into on behalf of
any of them with any Governmental Entity, relating to Taxes, including any IRS private letter
rulings or comparable rulings of any Governmental Entity and closing agreements pursuant to Section
7121 of the Code or any predecessor provision thereof or any similar provision of any applicable
law, which rulings or agreements would have a continuing effect after the Effective Time. Neither
Omega nor any of its Subsidiaries has engaged in a “reportable transaction,” as set forth in Treas.
Reg. § 1.6011-4(b), or any transaction that is the same as or substantially similar to one of the
types of transactions that the IRS has determined to be a tax avoidance transaction and identified
by notice, regulation or other form of published guidance as a “listed transaction,” as set forth
in Treas. Reg. § 1.6011-4(b)(2). FNB has received complete copies of (i) all federal, state,
local and foreign income or franchise Tax Returns of Omega and its Subsidiaries relating to the
taxable periods beginning January 1, 2004 or later and (ii) any audit report issued within the last
three years relating to any Taxes due from or with respect to Omega or its Subsidiaries. Neither
Omega, any of its Subsidiaries nor FNB (as a successor to Omega) will be required to include any
item of material income in, or exclude any material item of deduction from, taxable income for any
taxable period (or portion thereof) ending after the Closing Date as a result of any (i) change in
method of accounting for a taxable period ending on or prior to the Closing Date, (ii) installment
sale or open transaction disposition made on or prior to the Effective Time, (iii) prepaid amount
received on or prior to the Closing Date or (iv) deferred intercompany gain or any excess loss
account of Omega or any of its Subsidiaries for periods or portions of periods described in
Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of
state, local or foreign law) for periods (or portions thereof) ending on or before the Closing
Date.




-17-









 








          (b) As used in this Agreement, the term “Tax” or “Taxes” means (i) all federal, state, local,
and foreign income, excise, gross receipts, gross income, ad valorem, profits, gains, property,
capital, sales, transfer, use, payroll, bank shares tax, employment, severance, withholding,
duties, intangibles, franchise, backup withholding, inventory, capital stock, license, employment,
social security, unemployment, excise, stamp, occupation, and estimated taxes, and other taxes,
charges, levies or like assessments (ii) all interest, penalties, fines, additions to tax or
additional amounts imposed by any Governmental Entity in connection with any item described in
clause (i) and (iii) any transferee liability in respect of any items described in clauses (i) or
(ii) payable by reason of Contract, assumption, transferee liability, operation of Law, Treas. Reg
§1.1502-6(a) or any predecessor or successor thereof of any analogous or similar provision under
law or otherwise.




          (c) As used in this Agreement, the term “Tax Return” means any return, declaration, report,
claim for refund, or information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof, supplied or required to be supplied to a
Governmental Entity and any amendment thereof including, where permitted or required, combined,
consolidated or unitary returns for any group of entities.




     3.11 Employee Benefits. For purposes of this Agreement, the following terms shall
have the following meaning:



     “Controlled Group Liability” means any and all liabilities (i) under Title IV of ERISA, (ii)
under Section 302 of ERISA, (iii) under Sections 412 and 4971 of the Code, and (iv) as a result of
a failure to comply with the continuation coverage requirements of Section 601 et seq. of ERISA
and Section 4980B of the Code other than such liabilities that arise solely out of, or relate
solely to, the Omega Benefit Plans.



     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the
regulations promulgated thereunder.



     “ERISA Affiliate” means, with respect to any entity, trade or business, any other entity,
trade or business that is, or was at the relevant time, a member of a group described in Section
414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes or included the
first entity, trade or business, or that is, or was at the relevant time, a member of the same
“controlled group” as the first entity, trade or business pursuant to Section 4001(a)(14) of ERISA.



     “Multiemployer Plan” means any “multiemployer plan” within the meaning of Section 4001(a)(3)
of ERISA.



     “Omega Benefit Plan” means any material employee benefit plan, program, policy, practice, or
other arrangement providing benefits to any current or former employee, officer



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or director of Omega or any of its Subsidiaries or any beneficiary or dependent thereof that
is sponsored or maintained by Omega or any of its Subsidiaries or to which Omega or any of its
Subsidiaries contributes or is obligated to contribute, whether or not written, including without
limitation any employee welfare benefit plan within the meaning of Section 3(1) of ERISA, any
employee pension benefit plan within the meaning of Section 3(2) of ERISA (whether or not such plan
is subject to ERISA), and any bonus, incentive, deferred compensation, vacation, stock purchase,
stock option, severance, employment, change of control or fringe benefit plan, program or policy.



     “Omega Employment Agreement” means a written contract, offer letter or agreement of Omega or
any of its Subsidiaries with or addressed to any individual who is rendering or has rendered
services thereto as an employee pursuant to which Omega or any of its Subsidiaries has any actual
or contingent liability or obligation to provide compensation and/or benefits in consideration for
past, present or future services.



     “Omega Plan” means any Omega Benefit Plan other than a Multiemployer Plan.



     “Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or
partial withdrawal from such Multiemployer Plan, as those terms are defined in Part I of Subtitle E
of Title IV of ERISA.



          (a) Section 3.11(a) of the Omega Disclosure Schedule includes a complete list of all material
Omega Benefit Plans and all material Omega Employment Agreements.




          (b) With respect to each Omega Plan, Omega has delivered or made available to FNB a true,
correct and complete copy of: (i) each writing constituting a part of such Omega Plan, including
without limitation all plan documents, current employee communications, benefit schedules, trust
agreements, and insurance contracts and other funding vehicles; (ii) the most recent Annual Report
(Form 5500 Series) and accompanying schedule, if any; (iii) the current summary plan description
and any material modifications thereto, if any (in each case, whether or not required to be
furnished under ERISA); (iv) the most recent annual financial report, if any; (v) the most recent
actuarial report, if any; and (vi) the most recent determination letter from the Internal Revenue
Service (“the IRS”), if any. Omega has delivered or made available to FNB a true, correct and
complete copy of each material Omega Employment Agreement.




          (c) All material contributions required to be made to any Omega Plan by applicable law or
regulation or by any plan document or other contractual undertaking, and all material premiums due
or payable with respect to insurance policies funding any Omega Plan, for any period through the
date hereof have been timely made or paid in full or, if the contributions or payments are not due
on or before the date hereof, have been fully reflected on the financial statements to the extent
required by GAAP. Each Omega Benefit Plan that is an employee welfare benefit plan under Section
3(1) of ERISA either (i) is funded through an



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insurance company contract and is not a “welfare benefit fund” within the meaning of Section
419 of the Code or (ii) is unfunded.




          (d) With respect to each Omega Plan, Omega and its Subsidiaries have complied, and are now in
compliance, in all material respects, with all provisions of ERISA, the Code and all laws and
regulations applicable to such Omega Plans. Each Omega Plan has been administered in all material
respects in accordance with its terms. There is not now, nor do any circumstances exist that would
reasonably be expected to give rise to, any requirement for the posting of security with respect to
an Omega Plan or the imposition of any material lien on the assets of Omega or any of its
Subsidiaries under ERISA or the Code. Section 3.11(d) of the Omega Disclosure Schedule identifies
each Omega Plan that is intended to be a “qualified plan” within the meaning of Section 401(a) of
the Code (“Omega Qualified Plans”). The IRS has issued a favorable determination letter with
respect to each Omega Qualified Plan and the related trust that has not been revoked or Omega is
entitled to rely on a favorable opinion issued by the IRS, and, to the knowledge of Omega, there
are no existing circumstances and no events have occurred that would reasonably be expected to
adversely affect the qualified status of any Omega Qualified Plan or the related trust. No trust
funding any Omega Plan is intended to meet the requirements of Code Section 501(c)(9). To the
knowledge of Omega, none of Omega and its Subsidiaries nor any other person, including any
fiduciary, has engaged in any “prohibited transaction” (as defined in Section 4975 of the Code or
Section 406 of ERISA), which would reasonably be expected to subject any of the Omega Plans or
their related trusts, Omega, any of its Subsidiaries or any person that Omega or any of its
Subsidiaries has an obligation to indemnify, to any material Tax or penalty imposed under Section
4975 of the Code or Section 502 of ERISA.




          (e) With respect to each Omega Plan that is subject to Title IV or Section 302 of ERISA or
Section 412 or 4971 of the Code, (i) there does not exist any accumulated funding deficiency within
the meaning of Section 412 of the Code or Section 302 of ERISA, whether or not waived, and, (ii)
(A) the fair market value of the assets of such Omega Plan equals or exceeds the actuarial present
value of all accrued benefits under such Omega Plan (whether or not vested) on a termination basis;
(B) no reportable event within the meaning of Section 4043(c) of ERISA for which the 30-day notice
requirement has not been waived has occurred; (C) all premiums to the Pension Benefit Guaranty
Corporation (the “PBGC”) have been timely paid in full; (D) no liability (other than for premiums
to the PBGC) under Title IV of ERISA has been or would reasonably be expected to be incurred by
Omega or any of its Subsidiaries; and (E) the PBGC has not instituted proceedings to terminate any
such Omega Plan and, to Omega’s knowledge, no condition exists that presents a risk that such
proceedings will be instituted or which would reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any
such Omega Plan, except as would not have a Material Adverse Effect, individually or in the
aggregate, in the case of clauses (A), (B), (C), (D) and (E).




-20-









 








          (f) (i) No Omega Benefit Plan is a Multiemployer Plan or a plan that has two or more
contributing sponsors at least two of whom are not under common control, within the meaning of
Section 4063 of ERISA (a “Multiple Employer Plan”); (ii) none of Omega and its Subsidiaries nor any
of their respective ERISA Affiliates has, at any time during the last six years, contributed to or
been obligated to contribute to any Multiemployer Plan or Multiple Employer Plan; and (iii) none of
Omega and its Subsidiaries nor any of their respective ERISA Affiliates has incurred, during the
last six years, any Withdrawal Liability that has not been satisfied in full. There does not now
exist, nor do any circumstances exist that would reasonably be expected to result in, any
Controlled Group Liability that would be a liability of Omega or any of its Subsidiaries following
the Effective Time, other than such liabilities that arise solely out of, or relate solely to, the
Omega Benefit Plans. Without limiting the generality of the foregoing, neither Omega nor any of
its Subsidiaries, nor, to Omega’s knowledge, any of their respective ERISA Affiliates, has engaged
in any transaction described in Section 4069 or Section 4204 or 4212 of ERISA.




          (g) Omega and its Subsidiaries have no liability for life, health, medical or other welfare
benefits to former employees or beneficiaries or dependents thereof, except for health continuation
coverage as required by Section 4980B of the Code, Part 6 of Title I of ERISA or applicable law and
at no expense to Omega and its Subsidiaries.




          (h) Neither the execution nor the delivery of this Agreement nor the consummation of the
transactions contemplated by this Agreement will, either alone or in conjunction with any other
event (whether contingent or otherwise), (i) result in any payment or benefit becoming due or
payable, or required to be provided, to any director, employee or independent contractor of Omega
or any of its Subsidiaries, (ii) increase the amount or value of any benefit or compensation
otherwise payable or required to be provided to any such director, employee or independent
contractor, (iii) result in the acceleration of the time of payment, vesting or funding of any such
benefit or compensation or (iv) result in any amount failing to be deductible by reason of Section
280G of the Code or would be subject to an excise tax under Section 4999 of the Code or Section
409A of the Code.




          (i) No labor organization or group of employees of Omega or any of its Subsidiaries has made a
pending demand for recognition or certification, and there are no representation or certification
proceedings or petitions seeking a representation proceeding presently pending or, to Omega’s
knowledge, threatened to be brought or filed, with the National Labor Relations Board or any other
labor relations tribunal or authority. Each of Omega and its Subsidiaries is in material
compliance with all applicable laws respecting employment and employment practices, terms and
conditions of employment, wages and hours and occupational safety and health.




     3.12 SEC Reports. Omega has previously made available to FNB an accurate and complete
copy of each final registration statement, prospectus, report, schedule and definitive proxy
statement filed since January 1, 2005 by Omega with the SEC pursuant to the



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Securities Act or the Exchange Act (the “Omega Reports”), on and prior to the date of this
Agreement and no such Omega Report as of the date of such Omega Report contained any untrue
statement of a material fact or omitted to state any material fact required to be stated therein or
necessary in order to make the statements made therein, in light of the circumstances in which they
were made, not misleading, except that information as of a later date (but before the date of this
Agreement) shall be deemed to modify information as of an earlier date. Since January 1, 2005, as
of their respective dates, all Omega Reports filed under the Securities Act and the Exchange Act
complied as to form in all material respects with the published rules and regulations of the SEC
with respect thereto.



     3.13 Compliance with Applicable Law. Omega and each of its Subsidiaries hold all
licenses, franchises, permits and authorizations necessary for the lawful conduct of their
respective businesses under and pursuant to each, and, since January 1, 2005, have complied in all
respects with and are not in default in any respect under any, applicable law, statute, order,
rule, regulation, policy or guideline of any Governmental Entity relating to Omega or any of its
Subsidiaries (including the Equal Credit Opportunity Act, the Fair Housing Act, the Community
Reinvestment Act, the Home Mortgage Disclosure Act, the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorist (USA Patriot) Act of 2001,
the Bank Secrecy Act and applicable limits on loans to one borrower), except where the failure to
hold such license, franchise, permit or authorization or such noncompliance or default is not
reasonably likely to have, either individually or in the aggregate, a Material Adverse Effect on
Omega.



     3.14 Contracts. Except for matters that have not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on Omega and its
Subsidiaries taken as a whole, (i) none of Omega nor any of its Subsidiaries is (with or without
the lapse of time or the giving of notice, or both) in breach or default in any material respect
under any material contract, lease, license or other agreement or instrument, (ii) to the knowledge
of Omega, none of the other parties to any such material contract, lease, license or other
agreement or instrument is (with or without the lapse of time or the giving of notice, or both) in
breach or default in any material respect thereunder and (iii) neither Omega nor any of its
Subsidiaries has received any written notice of the intention of any party to terminate or cancel
any such material contract, lease, license or other agreement or instrument whether as a
termination or cancellation for convenience or for default of Omega or any of its Subsidiaries.



     3.15 Agreements with Regulatory Agencies. Neither Omega nor any of its Subsidiaries
is subject to any cease-and-desist or other order or enforcement action issued by, or is a party to
any written agreement, consent agreement or memorandum of understanding with, or is a party to any
commitment letter or similar undertaking to, or is subject to any order or directive by, or has
been ordered to pay any civil money penalty by, or has been since January 1, 2005, a recipient of
any supervisory letter from, or since January 1, 2005, has



-22-









 







adopted any policies, procedures or board resolutions at the request or suggestion of any
Regulatory Agency or other Governmental Entity that currently restricts in any material respect the
conduct of its business or that in any material manner relates to its capital adequacy, its ability
to pay dividends, its credit or risk management policies, its management or its business, other
than those of general application that apply to similarly situated financial holding companies or
their Subsidiaries (each item in this sentence, whether or not set forth in Section 3.15 of the
Omega Disclosure Schedule, an “Omega Regulatory Agreement”), nor has Omega or any of its
Subsidiaries been advised since January 1, 2005 by any Regulatory Agency or other Governmental
Entity that it is considering issuing, initiating, ordering, or requesting any such Omega
Regulatory Agreement. To the knowledge of Omega, there has not been any event or occurrence since
January 1, 2005 that could reasonably be expected to result in a determination that Omega Bank is
not “well capitalized” and “well managed” as a matter of U.S. federal banking law. Omega Bank has
at least a “satisfactory” rating under the U.S. Community Reinvestment Act.



     3.16 Undisclosed Liabilities. Except for (i) those liabilities that are reflected or
reserved against on the consolidated balance sheet of Omega included in the Omega 10-Q (including
any notes thereto) (ii) liabilities incurred in connection with this Agreement and the transactions
contemplated hereby and (iii) liabilities incurred in the ordinary course of business consistent
with past practice since September 30, 2007, since September 30, 2007, neither Omega nor any of its
Subsidiaries has incurred any liability of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether due or to become due) that has had or is reasonably likely to
have, either individually or in the aggregate, a Material Adverse Effect on Omega.



     3.17 Environmental Liability.



          (a) To Omega’s Knowledge, (A) Omega and its Subsidiaries are in material compliance with
applicable environmental laws; (B) no real property, including buildings or other structures,
currently or formerly owned or operated by Omega or any of its Subsidiaries, or any property in
which Omega or any of its Subsidiaries has held a security interest, Lien or a fiduciary or
management role (“Omega Loan Property”), has been contaminated with, or has had any release of, any
Hazardous Substance except in material compliance with Environmental Laws; (C) neither Omega nor
any of its Subsidiaries could be deemed the owner or operator of, or have actively participated in
the management regarding Hazardous Substances of, any Omega Loan Property that has been
contaminated with, or has had any material and unlawful release to the environment of, any
regulated quantity of any Hazardous Substance; (D) neither Omega nor any of its Subsidiaries has
any material liability for any Hazardous Substance disposal or contamination on any third party
property; (E) neither Omega nor any of its Subsidiaries has received any notice, demand letter,
claim or request for information alleging any material violation of, or liability under, any
Environmental Law; (F) neither Omega nor any of its Subsidiaries is subject to any order,



-23-









 






decree, injunction or other agreement with any Governmental Entity or any third party relating
to any Environmental Law; (G) there are no circumstances or conditions (including the presence of
unencapsulated friable asbestos, underground storage tanks, lead products, polychlorinated
biphenyls, prior manufacturing operations, dry-cleaning or automotive services) involving Omega or
any of its Subsidiaries, any currently or formerly owned or operated property, or any Omega Loan
Property, that could reasonably be expected to result in any material claims, liability or
investigations against Omega or any of its Subsidiaries, result in any material restrictions on the
ownership, use or transfer of any property pursuant to any Environmental Law or materially and
adversely affect the value of any Omega Loan Property, (H) Omega has set forth in Section 3.17 of
the Omega Disclosure Schedule and made available to FNB copies of all environmental reports or
studies, sampling data, correspondence and filings in its possession or reasonably available to it
relating to Omega, its Subsidiaries and any currently owned or operated property of Omega which
were prepared in the last five years and (I) Omega has made available to FNB copies of all
environmental reports or studies, sampling data, correspondence and filings in the possession or
reasonably available to it relating to any currently outstanding Omega Loan (as defined in Section
5.2(s)) and which were prepared for Omega in the last five years.




          (b) As used herein, (A) the term “Environmental Laws” means any federal, state or local law,
regulation, order, decree or permit relating to: (1) the protection or restoration of the
environment, human health, safety or natural resources in regard to any Hazardous Substance; (2)
the handling, use, presence, disposal, release or threatened release to the environment of any
Hazardous Substance or (3) material effects of any Hazardous Substance on any legally delineated
wetlands, indoor air spaces; (4) any material physical damage injury or any injury or threat of
injury to persons or property in connection with any Hazardous Substance; and (B) the term
“Hazardous Substance” means any regulated quantity of any substance other than at concentrations
and in locations that are naturally occurring that are: (1) listed, classified or regulated
pursuant to any Environmental Law; (2) any petroleum product or by-product, asbestos-containing
material, lead-containing paint or plumbing, polychlorinated biphenyls, radioactive materials or
radon or (3) any other substance that is the subject of regulatory action by any Governmental
Entity in connection with any Environmental Law and (C) the term “Omega’s Knowledge” means the
actual knowledge, immediately prior to the Effective Time and Effective Date, of any officer of
Omega.




     3.18 Real Property.



          (a) Each of Omega and its Subsidiaries has good title free and clear of all Liens to all real
property owned by such entities (the “Owned Properties”), except for Liens that do not materially
detract from the present use of such real property.




          (b) A true and complete copy of each agreement pursuant to which Omega or any of its
Subsidiaries leases any real property (such agreements, together with any



-24-









 






amendments, modifications and other supplements thereto, collectively, the “Leases”) has
heretofore been made available to FNB. Each Lease is valid, binding and enforceable against Omega
or its applicable Subsidiary in accordance with its terms and is in full force and effect (except
as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting
the rights of creditors generally and the availability of equitable remedies). There is not under
any such Lease any material existing default by Omega or any of its Subsidiaries or, to the
knowledge of Omega, any other party thereto, or any event which with notice or lapse of time or
both would constitute such a default. The consummation of the transactions contemplated by this
Agreement will not cause defaults under the Leases, except for any such default which would not,
individually or in the aggregate, have a Material Adverse Effect on Omega and its Subsidiaries
taken as a whole.




          (c) The Owned Properties and the properties leased pursuant to the Leases (the “Leased
Properties”) constitute all of the real estate on which Omega and its Subsidiaries maintain their
facilities or conduct their business as of the date of this Agreement, except for locations the
loss of which would not result in a Material Adverse Effect on Omega and its Subsidiaries taken as
a whole.




          (d) A true and complete copy of each agreement pursuant to which Omega or any of its
Subsidiaries leases real property to a third party (such agreements, together with any amendments,
modifications and other supplements thereto, collectively, the “Third Party Leases”) has heretofore
been made available to FNB. Each Third Party Lease is valid, binding and enforceable in accordance
with its terms and is in full force and effect (except as may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting the rights of creditors generally and the
availability of equitable remedies). To the knowledge of Omega, there are no existing defaults by
the tenant under any Third Party Lease, or any event which with notice or lapse of time or both
which would constitute such a default.




     3.19 State Takeover Laws. Omega has previously taken any and all action necessary to
render the provisions of the Pennsylvania anti-takeover statutes in Sections 2538 through 2588
inclusive of the PBCL that may be applicable to the Merger and the other transactions contemplated
by this Agreement inapplicable to FNB and its respective affiliates, and to the Merger, this
Agreement and the transactions contemplated hereby. The Board of Directors of Omega has approved
this Agreement and the transactions contemplated hereby as required to render inapplicable to such
Agreement and the transactions contemplated hereby any restrictive provisions, including the
provisions of Paragraph 9, of the Omega Articles.



     3.20 Reorganization. As of the date of this Agreement, Omega is not aware of any fact
or circumstance that could reasonably be expected to prevent the Merger from qualifying as a
“reorganization” within the meaning of Section 368(a) of the Code.



     3.21 Opinion. Prior to the execution of this Agreement, Omega has received an opinion
from Keefe, Bruyette & Woods, Inc. to the effect that as of the date thereof and based



-25-









 







upon and subject to the matters set forth therein, the Merger Consideration is fair to the
shareholders of Omega from a financial point of view. Such opinion has not been amended or
rescinded as of the date of this Agreement.



     3.22 Insurance. Omega and its Subsidiaries are insured with reputable insurers
against such risks and in such amounts as are set forth in Section 3.22 of the Omega Disclosure
Schedule and as its management reasonably has determined to be prudent in accordance with industry
practices.



     3.23 Investment Securities. Except where failure to be true would not reasonably be
expected to have a Material Adverse Effect on Omega, (a) each of Omega and its Subsidiaries has
good title to all securities owned by it (except those sold under repurchase agreements or held in
any fiduciary or agency capacity), free and clear of any Liens, except to the extent such
securities are pledged in the ordinary course of business to secure obligations of Omega or its
Subsidiaries, and such securities are valued on the books of Omega in accordance with GAAP in all
material respects.



     3.24 Intellectual Property. Omega and each of its Subsidiaries owns, or is licensed
to use (in each case, free and clear of any Liens), all Intellectual Property used in the conduct
of its business as currently conducted that is material to Omega and its Subsidiaries, taken as a
whole. Except as would not reasonably be expected to have a Material Adverse Effect on Omega, (i)
Intellectual Property used in the conduct of its business as currently conducted that is material
to Omega and its Subsidiaries does not, to the knowledge of Omega, infringe on or otherwise violate
the rights of any person and is in accordance with any applicable license pursuant to which Omega
or any Subsidiary acquired the right to use any Intellectual Property; and (ii) neither Omega nor
any of its Subsidiaries has received any written notice of any pending claim with respect to any
Intellectual Property used by Omega and its Subsidiaries. For purposes of this Agreement,
“Intellectual Property” means registered trademarks, service marks, brand names, certification
marks, trade dress and other indications of origin, the goodwill associated with the foregoing and
registrations in the United States Patent and Trademark Office or in any similar office or agency
of the United States or any state thereof; all letters patent of the United States, all reissues
and extensions thereof, and all applications for letters patent of the United States and all
divisions, continuations and continuations-in-part thereof; all registered copyrights arising under
the laws of the United States and recordings thereof, and all applications in connection therewith,
including, without limitation, all registrations, recordings and applications in the United States
Copyright Office; all rights to obtain any reissues, renewals or extensions of the foregoing, and
all causes of action for infringement of the foregoing.



     3.25 Loans; Nonperforming and Classified Assets.



          (a) Except as set forth in Section 3.25 of the Omega Disclosure Schedule, each Loan on the
books and records of Omega and its Subsidiaries was made and has been



-26-









 






serviced in all material respects in accordance with their customary lending standards in the
ordinary course of business, is evidenced in all material respects by appropriate and sufficient
documentation and, to the knowledge of Omega, constitutes the legal, valid and binding obligation
of the obligor named therein, subject to bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer and similar laws of general applicability relating to or affecting creditor’s
rights or by general equity principles.




          (b) Omega has set forth in Section 3.25 of the Omega Disclosure Schedule as to Omega and each
Omega Subsidiary as of the latest practicable date prior to the date of this Agreement: (A) any
written or, to Omega’s knowledge, oral Loan under the terms of which the obligor is 90 or more days
delinquent in payment of principal or interest, or to Omega’s knowledge, in default of any other
material provision thereof; (B) each Loan that has been classified as “substandard,” “doubtful,”
“loss” or “special mention” or words of similar import by Omega, a Omega Subsidiary or an
applicable regulatory authority; (C) a listing of the Other Real Estate Owned (“OREO”) acquired by
foreclosure or by deed-in-lieu thereof, including the book value thereof and (D) each Loan with any
director, executive officer or five percent or greater shareholder of Omega or a Omega Subsidiary,
or to the knowledge of Omega, any Person controlling, controlled by or under common control with
any of the foregoing.




     3.26 Fiduciary Accounts. Omega and each of its Subsidiaries has properly administered
all accounts for which it acts as a fiduciary, including but not limited to accounts for which it
serves as a trustee, agent, custodian, personal representative, guardian, conservator or investment
advisor, in accordance with the terms of the governing documents and applicable laws and
regulations. Neither Omega nor any of its Subsidiaries, nor any of their respective directors,
officers or employees, has committed any breach of trust to Omega’s knowledge with respect to any
fiduciary account and the records for each such fiduciary account are true and correct and
accurately reflect the assets of such fiduciary account.



     3.27 Allowance For Loan Losses. Omega Bank’s allowance for loan losses is sufficient
at the date of this Agreement for its reasonably anticipated loan losses, is in compliance with the
standards established by applicable Governmental Entities and GAAP and, to the knowledge of Omega,
is adequate.



ARTICLE IV




REPRESENTATIONS AND WARRANTIES OF FNB




     Except as disclosed in the disclosure schedule delivered by FNB to Omega (the “FNB Disclosure
Schedule”), FNB hereby represents and warrants to Omega as follows:



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     4.1 Corporate Organization.



          (a) FNB is a corporation duly organized, validly existing and in good standing under the laws
of the State of Florida. FNB has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as it is now being conducted, and is duly
licensed or qualified to do business in each jurisdiction in which the nature of the business
conducted by it or the character or location of the properties and assets owned or leased by it
makes such licensing or qualification necessary.




          (b) FNB is duly registered as a bank holding company and is a financial holding company under
the BHC Act. True and complete copies of the Articles of Incorporation (the “FNB Charter”) and
Bylaws of FNB (the “FNB Bylaws”), as in effect as of the date of this Agreement, have previously
been made available to Omega.




          (c) Each FNB Subsidiary (i) is duly organized and validly existing under the laws of its
jurisdiction of organization, (ii) is duly qualified to do business and in good standing in all
jurisdictions (whether federal, state, local or foreign) where its ownership or leasing of property
or the conduct of its business requires it to be so qualified, and (iii) has all requisite
corporate power and authority to own or lease its properties and assets and to carry on its
business as now conducted, except in each of (i) – (iii) as would not be reasonably likely to have,
either individually or in the aggregate, a Material Adverse Effect on FNB.




     4.2 Capitalization.



          (a) The authorized capital stock of FNB consists of 500,000,000 shares of FNB Common Stock, of
which, as of September 30, 2007 60,555,834 shares were issued and outstanding, and 20,000,000
shares of preferred stock, $.01 par value (the “FNB Preferred Stock”), of which, as of the date
hereof, no shares were issued and outstanding. As of September 30, 2007 shares of FNB Common Stock
were held in FNB’s treasury. As of the date hereof, no shares of FNB Common Stock or FNB Preferred
Stock were reserved for issuance, except for 8,103,789 shares of FNB Common Stock reserved for
issuance upon exercise of options issued or available for issuance pursuant to employee and
director stock plans of FNB in effect as of the date of this Agreement (the “FNB Stock Plans”) and
53,000 shares of FNB Common Stock available for issuance upon conversion of outstanding convertible
notes assumed by FNB from Legacy Bank. All of the issued and outstanding shares of FNB Common
Stock have been, and all shares of FNB Common Stock that may be issued pursuant to the FNB Stock
Plans will be, when issued in accordance with the terms thereof, duly authorized and validly issued
and are fully paid, nonassessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof. Except pursuant to this Agreement and the FNB Stock Plans, FNB
is not bound by any outstanding subscriptions, options, warrants, calls, commitments or agreements
of any character calling for the purchase or issuance of any shares of FNB Common Stock or any
other equity securities of FNB or any securities representing the right to purchase or otherwise
receive any



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shares of FNB Common Stock. The shares of FNB Common Stock to be issued pursuant to the
Merger have been duly authorized and, when issued and delivered in accordance with the terms of
this Agreement, will have been validly issued, fully paid, nonassessable and free of preemptive
rights, with no personal liability attaching to the ownership thereof.




          (b) All of the issued and outstanding shares of capital stock or other equity ownership
interests of each Subsidiary of FNB are owned by FNB, directly or indirectly, free and clear of any
Liens, and all of such shares or equity ownership interests are duly authorized and validly issued
and are fully paid, nonassessable and free of preemptive rights. No such Subsidiary has or is
bound by any outstanding subscriptions, options, warrants, calls, commitments or agreements of any
character calling for the purchase or issuance of any shares of capital stock or any other equity
security of such Subsidiary or any securities representing the right to purchase or otherwise
receive any shares of capital stock or any other equity security of such Subsidiary.




     4.3 Authority; No Violation.



          (a) FNB has full corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby have been duly and validly approved by the
Board of Directors of FNB. The Board of Directors of FNB has determined that this Agreement and
the transactions contemplated hereby are in the best interests of FNB and its shareholders, and has
directed that a proposal to issue shares of FNB Common Stock under this Agreement and the
transactions contemplated by this Agreement be submitted to FNB’s shareholders for approval and
adoption at a duly held meeting of such shareholders and, except for the approval of such proposal
by the affirmative vote of a majority of the votes cast by all holders of shares of FNB Common
Stock at such meeting at which a quorum is present, and provided that the total votes cast on the
proposal represents over 50% of the shares of FNB Common Stock entitled to vote on the proposal, no
other corporate proceedings on the part of FNB are necessary to approve this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly and validly executed
and delivered by FNB and, assuming due authorization, execution and delivery by Omega, constitutes
the valid and binding obligation of FNB, enforceable against FNB in accordance with its terms,
except as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws
affecting the rights of creditors generally and the availability of equitable remedies.




          (b) Neither the execution and delivery of this Agreement by FNB, nor the consummation by FNB
of the transactions contemplated hereby, nor compliance by FNB with any of the terms or provisions
of this Agreement, will violate any provision of the FNB Charter or the FNB Bylaws or assuming that
the consents, approvals and filings referred to in Section 4.4 are duly obtained and/or made, (A)
violate any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or Injunction
applicable to FNB, any of its



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Subsidiaries or any of their respective properties or assets or (B) violate, conflict with,
result in a breach of any provision of or the loss of any benefit under, constitute a default (or
an event which, with notice or lapse of time, or both, would constitute a default) under, result in
the termination of or a right of termination or cancellation under, accelerate the performance
required by, or result in the creation of any Lien upon any of the respective properties or assets
of FNB or any of its Subsidiaries under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or
obligation to which FNB or any of its Subsidiaries is a party, or by which they or any of their
respective properties or assets may be bound or affected, except for such violations, conflicts,
breaches or defaults with respect to clause (iii) that are not reasonably likely to have, either
individually or in the aggregate, a Material Adverse Effect on FNB.




     4.4 Consents and Approvals. Except for (i) the filing of applications and notices, as
applicable, with the Federal Reserve Board under the BHC Act and the Federal Reserve Act, as
amended, and approval of such applications and notices, and, in connection with the acquisition of
the Bank by FNB, the filing of applications and notices, as applicable, with the FDIC, the OCC or
the PA DOB and the Federal Reserve Board and approval of such applications and notice, (ii) the
Other Regulatory Approvals, (iii) the filing with the SEC of the Joint Proxy Statement and the
filing and declaration of effectiveness of the Registration Statement, (iv) the filing of the
Articles of Merger with and the acceptance for record by the Secretary of State of the Commonwealth
of Pennsylvania pursuant to the PBCL and the filing of the Articles of Merger with and the
acceptance for record by the Secretary of State of the State of Florida pursuant to the FBCA, (v)
any notices or filings under the HSR Act, (vi) any consents, authorizations, approvals, filings or
exemptions in connection with compliance with the applicable provisions of federal and state
securities laws relating to the regulation of broker-dealers, investment advisers or transfer
agents and the rules and regulations thereunder and of any applicable industry SRO, and the rules
of Nasdaq or the NYSE, or that are required under consumer finance, mortgage banking and other
similar laws, (vii) such filings and approvals as are required to be made or obtained under the
securities or “Blue Sky” laws of various states in connection with the issuance of the shares of
FNB Common Stock pursuant to this Agreement and approval of listing such FNB Common Stock on the
NYSE, (viii) the approval of the issuance of FNB Common Stock in connection with the Merger and the
transactions contemplated by this Agreement by the requisite vote of the shareholders of FNB and
(ix) filings, if any, required as a result of the particular status of Omega, no consents or
approvals of or filings or registrations with any Governmental Entity are necessary in connection
with (A) the execution and delivery by FNB of this Agreement and (B) the consummation by FNB of the
Merger and the other transactions contemplated by this Agreement.



     4.5 Reports. FNB and each of its Subsidiaries have in all material respects timely
filed all reports, registrations and statements, together with any amendments required to be made
with respect thereto, that they were required to file since January 1, 2005 with the



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Regulatory Agencies and with each other applicable Governmental Entity, and all other reports
and statements required to be filed by them since January 1, 2005, including any report or
statement required to be filed pursuant to the laws, rules or regulations of the United States, any
state, any foreign entity, or any Regulatory Agency, and have paid all fees and assessments due and
payable in connection therewith. Except for normal examinations conducted by a Regulatory Agency
in the ordinary course of the business of FNB and its Subsidiaries, no Regulatory Agency has
initiated or has pending any proceeding or, to the knowledge of FNB, investigation into the
business or operations of FNB or any of its Subsidiaries since January 1, 2005. There (i) is no
unresolved violation, criticism or exception by any Regulatory Agency with respect to any report or
statement relating to any examinations or inspections of FNB or any of its Subsidiaries, and (ii)
has been no formal or informal inquiries by, or disagreements or disputes with, any Regulatory
Agency with respect to the business, operations, policies or procedures of FNB since January 1,
2005.



     4.6 Financial Statements. (i) FNB has previously made available to Omega copies of
the consolidated balance sheet of FNB and its Subsidiaries as of December 31, 2004, 2005 and 2006,
and the related consolidated statements of income, changes in shareholders’ equity and cash flows
for the years then ended as reported in FNB’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2006 (as amended prior to the date hereof, the “FNB 2006 10-K”) filed with the SEC
under the Exchange Act, accompanied by the audit report of Ernst & Young LLP, independent
registered public accountants with respect to FNB for the years ended December 31, 2004, 2005 and
2006, and (ii) FNB will make available to Omega when filed with the SEC copies of the unaudited
consolidated balance sheet of FNB and its Subsidiaries as of September 30, 2006 and 2007, and the
related consolidated statements of income, changes in shareholders’ equity and cash flows of the
three- and nine-month periods then ended, as reported in FNB’s Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 2007 (the “FNB 10-Q”). The December 31, 2006 consolidated
balance sheet of FNB (including the related notes, where applicable) fairly presents in all
material respects the consolidated financial position of FNB and its Subsidiaries as of the date
thereof, and the other financial statements referred to in this Section 4.6 (including the related
notes, where applicable) fairly present in all material respects the results of the consolidated
operations, cash flows and changes in shareholders’ equity and consolidated financial position of
FNB and its Subsidiaries for the respective fiscal periods or as of the respective dates therein
set forth, subject to normal year-end audit adjustments in amounts consistent with past experience
in the case of unaudited statements; each of such statements (including the related notes, where
applicable) complies in all material respects with applicable accounting requirements and with the
published rules and regulations of the SEC with respect thereto; and each of such statements
(including the related notes, where applicable) has been prepared in all material respects in
accordance with GAAP consistently applied during the periods involved, except, in each case, as
indicated in such statements or in the notes thereto. The books and records of FNB and its
Subsidiaries have been, and are being,



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maintained in all material respects in accordance with GAAP and any other applicable legal and
accounting requirements and reflect only actual transactions.



     4.7 Broker’s Fees. Neither FNB nor any FNB Subsidiary nor any of their respective
officers or directors has employed any broker or finder or incurred any liability for any brokers
fees, commissions or finder’s fees in connection with the Merger or related transactions
contemplated by this Agreement, other than UBS Securities LLC, all of the fees and expenses of
which shall be the sole responsibility of FNB.



     4.8 Absence of Certain Changes or Events. Since December 31, 2006, except as publicly
disclosed in the Forms 10-K, 10-Q and 8-K comprising the FNB Reports (as defined in Section 4.12)
filed prior to the date of this Agreement (i) FNB and the FNB Subsidiaries have (except in
connection with the negotiation and execution and delivery of this Agreement) carried on their
respective businesses in all material respects in the ordinary course consistent with past practice
and (ii) there has not been any Material Adverse Effect with respect to FNB.



     4.9 Legal Proceedings.



          (a) There is no pending, or, to FNB’s knowledge, threatened, litigation, action, suit,
proceeding, investigation or arbitration by any Person or Governmental Entity that is material to
FNB and its Subsidiaries, taken as a whole, in each case with respect to FNB or any of its
Subsidiaries or any of their respective properties or permits, licenses or authorizations.




          (b) There is no material Injunction, judgment, or regulatory restriction (other than those of
general application that apply to similarly situated financial or bank holding companies or their
Subsidiaries) imposed upon FNB, any of its Subsidiaries or the assets of FNB or any of its
Subsidiaries.




     4.10 Taxes and Tax Returns. Each of FNB and its Subsidiaries has duly and timely
filed (including all applicable extensions) all Tax Returns required to be filed by it on or prior
to the date of this Agreement (all such Tax Returns being accurate and complete in all material
respects), has timely paid or withheld and timely remitted all Taxes shown thereon as arising and
has duly and timely paid or withheld and timely remitted all Taxes (whether or not shown on any Tax
Return) that are due and payable or claimed to be due from it by a Governmental Entity other than
Taxes that (i) are being contested in good faith, which have not been finally determined, and (ii)
have been adequately reserved against in accordance with GAAP on FNB’s most recent consolidated
financial statements. All required estimated Tax payments sufficient to avoid any underpayment
penalties or interest have been made by or on behalf of each of FNB and its Subsidiaries. Neither
FNB nor any of its Subsidiaries has granted any extension or waiver of the limitation period for
the assessment or collection of Tax that remains in effect. There are no disputes, audits,
examinations or proceedings in



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progress or pending (including any notice received of an intent to conduct an audit or
examination), or claims asserted, for Taxes upon FNB or any of its Subsidiaries. No claim has been
made by a Governmental Entity in a jurisdiction where the FNB or any of its Subsidiaries has not
filed Tax Returns such that FNB or any of its Subsidiaries is or may be subject to taxation by that
jurisdiction. All deficiencies asserted or assessments made as a result of any examinations by any
Governmental Entity of the Tax Returns of, or including, FNB or any of its Subsidiaries have been
fully paid. No issue has been raised by a Governmental Entity in any prior examination or audit of
each of FNB and its Subsidiaries which, by application of the same or similar principles, could
reasonably be expected to result in a proposed deficiency in respect of such Governmental Entity
for any subsequent taxable period. There are no Liens for Taxes (other than statutory liens for
Taxes not yet due and payable) upon any of the assets of FNB or any of its Subsidiaries. Neither
FNB nor any of its Subsidiaries is a party to or is bound by any Tax sharing, allocation or
indemnification agreement or arrangement (other than such an agreement or arrangement exclusively
between or among FNB and its Subsidiaries). Neither FNB nor any of its Subsidiaries (A) has been a
member of an affiliated group filing a consolidated federal income Tax Return (other than a group
the common parent of which was FNB) or (B) has any liability for the Taxes of any Person (other
than FNB or any of its Subsidiaries) under Treas. Reg. §1.1502-6 (or any similar provision of
state, local or foreign law), or as a transferee or successor, by contract or otherwise. Neither
FNB nor any of its Subsidiaries has been, within the past two years or otherwise as part of a “plan
(or series of related transactions)” (within the meaning of Section 355(e) of the Code) of which
the Merger is also a part, or a “distributing corporation” or a “controlled corporation” (within
the meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock intended to qualify for
tax-free treatment under Section 355 of the Code. No share of FNB Common Stock is owned by a
Subsidiary of FNB. FNB is not and has not been a “United States real property holding company”
within the meaning of Section 897(c)(2) of the Code during the applicable period specified in
Section 897(c)(1)(A)(ii) of the Code. Neither FNB, its Subsidiaries nor any other Person on their
behalf has executed or entered into any written agreement with, or obtained or applied for any
written consents or written clearances or any other Tax rulings from, nor has there been any
written agreement executed or entered into on behalf of any of them with any Taxing Authority,
relating to Taxes, including any IRS private letter rulings or comparable rulings of any Taxing
Authority and closing agreements pursuant to Section 7121 of the Code or any predecessor provision
thereof or any similar provision of any applicable law, which rulings or agreements would have a
continuing effect after the Effective Time. Neither FNB nor any of its Subsidiaries has engaged in
a “reportable transaction,” as set forth in Treas. Reg. §1.6011-4(b), or any transaction that is
the same as or substantially similar to one of the types of transactions that the IRS has
determined to be a tax avoidance transaction and identified by notice, regulation or other form of
published guidance as a “listed transaction,” as set forth in Treas. Reg. §1.6011-4(b)(2). Omega
has received complete copies of (i) all federal, state, local and foreign income or franchise Tax
Returns of FNB and its Subsidiaries relating to the taxable periods beginning January 1, 2004 or
later and (ii) any audit report issued within the last three years



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relating to any Taxes due from or with respect to FNB or its Subsidiaries. Neither FNB, nor
any of its Subsidiaries will be required to include any item of material income in, or exclude any
material item of deduction from, taxable income for any taxable period (or portion thereof) ending
after the Closing Date as a result of any (i) change in method of accounting for a taxable period
ending on or prior to the Closing Date, (ii) installment sale or open transaction disposition made
on or prior to the Effective Time, (iii) prepaid amount received on or prior to the Closing Date
or (iv) deferred intercompany gain or any excess loss account of FNB or any of its Subsidiaries for
periods or portions of periods described in Treasury Regulations under Section 1502 of the Code (or
any corresponding or similar provision of state, local or foreign law) for periods (or portions
thereof) ending on or before the Closing Date.



     4.11 Employee Benefits. For purposes hereof, the following terms shall have the
following meaning:



     “FNB Benefit Plan” means any material employee benefit plan, program, policy, practice, or
other arrangement providing benefits to any current or former employee, officer or director of FNB
or any of its Subsidiaries or any beneficiary or dependent thereof that is sponsored or maintained
by FNB or any of its Subsidiaries or to which FNB or any of its Subsidiaries contributes or is
obligated to contribute, whether or not written, including without limitation any employee welfare
benefit plan within the meaning of Section 3(1) of ERISA, any employee pension benefit plan within
the meaning of Section 3(2) of ERISA (whether or not such plan is subject to ERISA) and any bonus,
incentive, deferred compensation, vacation, stock purchase, stock option, severance, employment,
change of control or fringe benefit plan, program or policy.



     “FNB Employment Agreement” means a written contract, offer letter or agreement of FNB or any
of its Subsidiaries with or addressed to any individual who is rendering or has rendered services
thereto as an employee pursuant to which FNB or any of its Subsidiaries has any actual or
contingent liability or obligation to provide compensation and/or benefits in consideration for
past, present or future services.



     “FNB Plan” means any FNB Benefit Plan other than a Multiemployer Plan.



          (a) Section 4.11(a) of the FNB Disclosure Schedule includes a complete list of all material
FNB Benefit Plans and all material FNB Employment Agreements.




          (b) With respect to each FNB Plan, FNB has delivered or made available to Omega a true,
correct and complete copy of: (i) each writing constituting a part of such FNB Plan, including
without limitation all plan documents, employee communications, benefit schedules, trust
agreements, and insurance contracts and other funding vehicles; (ii) the most recent Annual Report
(Form 5500 Series) and accompanying schedule, if any; (iii) the current summary plan description
and any material modifications thereto, if any (in each case,



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whether or not required to be furnished under ERISA); (iv) the most recent annual financial
report, if any; (v) the most recent actuarial report, if any; and (vi) the most recent
determination letter from the IRS, if any. FNB has delivered or made available to Omega a true,
correct and complete copy of each material FNB Employment Agreement.




          (c) All material contributions required to be made to any FNB Plan by applicable law or
regulation or by any plan document or other contractual undertaking, and all material premiums due
or payable with respect to insurance policies funding any FNB Plan, for any period through the date
hereof have been timely made or paid in full or, to the extent not required to be made or paid on
or before the date hereof, have been fully reflected on the financial statements to the extent
required by GAAP. Each FNB Benefit Plan that is an employee welfare benefit plan under Section
3(1) of ERISA either (i) is funded through an insurance company contract and is not a “welfare
benefit fund” within the meaning of Section 419 of the Code or (ii) is unfunded.




          (d) With respect to each FNB Plan, FNB and its Subsidiaries have complied, and are now in
compliance, in all material respects, with all provisions of ERISA, the Code and all laws and
regulations applicable to such FNB Plans. Each FNB Plan has been administered in all material
respects in accordance with its terms. There is not now, nor do any circumstances exist that would
reasonably be expected to give rise to, any requirement for the posting of security with respect to
a FNB Plan or the imposition of any material lien on the assets of FNB or any of its Subsidiaries
under ERISA or the Code. Section 4.11(d) of the FNB Disclosure Schedule identifies each FNB Plan
that is intended to be a “qualified plan” within the meaning of Section 401(a) of the Code (“FNB
Qualified Plans”). The IRS has issued a favorable determination letter with respect to each
Qualified Plan and the related trust that has not been revoked or FNB is entitled to rely on a
favorable opinion issued by the IRS, and, to the knowledge of FNB, there are no existing
circumstances and no events have occurred that would reasonably be expected to adversely affect the
qualified status of any FNB Qualified Plan or the related trust. No trust funding any FNB Plan is
intended to meet the requirements of Code Section 501(c)(9). To the knowledge of FNB, none of FNB
and its Subsidiaries nor any other person, including any fiduciary, has engaged in any “prohibited
transaction” (as defined in Section 4975 of the Code or Section 406 of ERISA), which would
reasonably be expected to subject any of the FNB Plans or their related trusts, FNB, any of its
Subsidiaries or any person that FNB or any of its Subsidiaries has an obligation to indemnify, to
any material Tax or penalty imposed under Section 4975 of the Code or Section 502 of ERISA.




          (e) With respect to each FNB Plan that is subject to Title IV or Section 302 of ERISA or
Section 412 or 4971 of the Code, (i) there does not exist any accumulated funding deficiency within
the meaning of Section 412 of the Code or Section 302 of ERISA, whether or not waived, and, (ii)
except as would not have, individually or in the aggregate, a Material Adverse Effect: (A) the fair
market value of the assets of such FNB Plan equals or exceeds the



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actuarial present value of all accrued benefits under such FNB Plan (whether or not vested) on
a termination basis; (B) no reportable event within the meaning of Section 4043(c) of ERISA for
which the 30-day notice requirement has not been waived has occurred; (C) all premiums to the PBGC
have been timely paid in full; (D) no liability (other than for premiums to the PBGC) under Title
IV of ERISA has been or would reasonably be expected to be incurred by FNB or any of its
Subsidiaries; and (E) the PBGC has not instituted proceedings to terminate any such FNB Plan and,
to FNB’s knowledge, no condition exists that presents a risk that such proceedings will be
instituted or which would reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any such FNB Plan.




          (f) (i) No FNB Benefit Plan is a Multiemployer Plan or a Multiple Employer Plan; (ii) none of
FNB and its Subsidiaries nor any of their respective ERISA Affiliates has, at any time during the
last six years, contributed to or been obligated to contribute to any Multiemployer Plan or
Multiple Employer Plan; and (iii) none of FNB and its Subsidiaries nor any of their respective
ERISA Affiliates has incurred, during the last six years, any Withdrawal Liability that has not
been satisfied in full. There does not now exist, nor do any circumstances exist that would
reasonably be expected to result in, any Controlled Group Liability that would be a liability of
FNB or any of its Subsidiaries following the Effective Time, other than such liabilities that arise
solely out of, or relate solely to, the FNB Benefit Plans. Without limiting the generality of the
foregoing, neither FNB nor any of its Subsidiaries, nor, to FNB’s knowledge, any of their
respective ERISA Affiliates, has engaged in any transaction described in Section 4069 or Section
4204 or 4212 of ERISA.




          (g) FNB and its Subsidiaries have no liability for life, health, medical or other welfare
benefits to former employees or beneficiaries or dependents thereof, except for health continuation
coverage as required by Section 4980B of the Code, Part 6 of Title I of ERISA or applicable law and
at no expense to FNB and its Subsidiaries.




          (h) Neither the execution nor the delivery of this Agreement nor the consummation of the
transactions contemplated by this Agreement will, either alone or in conjunction with any other
event (whether contingent or otherwise), (i) result in any payment or benefit becoming due or
payable, or required to be provided, to any director, employee or independent contractor of FNB or
any of its Subsidiaries, (ii) increase the amount or value of any benefit or compensation otherwise
payable or required to be provided to any such director, employee or independent contractor, (iii)
result in the acceleration of the time of payment, vesting or funding of any such benefit or
compensation or (iv) result in any amount failing to be deductible by reason of Section 280G of the
Code or would be subject to an excise tax under Section 4999 of the Code or Section 409A of the
Code.




          (i) No labor organization or group of employees of FNB or any of its Subsidiaries has made a
pending demand for recognition or certification, and there are no representation or certification
proceedings or petitions seeking a representation proceeding



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presently pending or, to FNB’s knowledge, threatened to be brought or filed, with the National
Labor Relations Board or any other labor relations tribunal or authority. Each of FNB and its
Subsidiaries is in material compliance with all applicable laws and collective bargaining
agreements respecting employment and employment practices, terms and conditions of employment,
wages and hours and occupational safety and health.




     4.12 SEC Reports. FNB has previously made available to Omega an accurate and complete
copy of each final registration statement, prospectus, report, schedule and definitive proxy
statement filed since January 1, 2005 by FNB with the SEC pursuant to the Securities Act or the
Exchange Act (the “FNB Reports”) and prior to the date of this Agreement, as of the date of such
FNB Report, contained any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements made therein, in light
of the circumstances in which they were made, not misleading, except that information as of a later
date (but before the date of this Agreement) shall be deemed to modify information as of an earlier
date. Since January 1, 2005, as of their respective dates, all FNB Reports filed under the
Securities Act and the Exchange Act complied as to form in all material respects with the published
rules and regulations of the SEC with respect thereto.



     4.13 Compliance with Applicable Law. FNB and each of its Subsidiaries hold all
licenses, franchises, permits and authorizations necessary for the lawful conduct of their
respective businesses under and pursuant to each, and since January 1, 2005, have complied in all
respects with and are not in default in any respect under any applicable law, statute, order, rule,
regulation, policy or guideline of any Governmental Entity relating to FNB or any of its
Subsidiaries (including the Equal Credit Opportunity Act, the Fair Housing Act, the Community
Reinvestment Act, the Home Mortgage Disclosure Act, the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorist (USA Patriot) Act of 2001,
the Bank Secrecy Act and applicable limits on loans to one borrower), except where the failure to
hold such license, franchise, permit or authorization or such noncompliance or default is not
reasonably likely to, either individually or in the aggregate, have a Material Adverse Effect on
FNB.



     4.14 Contracts. Except for matters that have not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on FNB and its
Subsidiaries taken as a whole, (i) none of FNB nor any of its Subsidiaries is (with or without the
lapse of time or the giving of notice, or both) in breach or default in any material respect under
any material contract, lease, license or other agreement or instrument, (ii) to the knowledge of
FNB, none of the other parties to any such material contract, lease, license or other agreement or
instrument is (with or without the lapse of time or the giving of notice, or both) in breach or
default in any material respect thereunder and (iii) neither FNB nor any of its Subsidiaries has
received any written notice of the intention of any party to terminate or




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cancel any such material contract, lease, license or other agreement or instrument whether as
a termination or cancellation for convenience or for default of FNB or any of its Subsidiaries.




     4.15 Agreements with Regulatory Agencies. Neither FNB nor any of its Subsidiaries is
subject to any cease-and-desist or other order or enforcement action issued by, or is a party to
any written agreement, consent agreement or memorandum of understanding with, or is a party to any
commitment letter or similar undertaking to, or is subject to any order or directive by, or has
been since January 1, 2005, a recipient of any supervisory letter from, or has been ordered to pay
any civil money penalty by, or since January 1, 2005, has adopted any policies, procedures or board
resolutions at the request or suggestion of any Regulatory Agency or other Governmental Entity that
currently restricts in any material respect the conduct of its business or that in any material
manner relates to its capital adequacy, its ability to pay dividends, its credit or risk management
policies, its management or its business, other than those of general application that apply to
similarly situated financial holding companies or their Subsidiaries (each item in this sentence,
whether or not set forth in the FNB Disclosure Schedule, a “FNB Regulatory Agreement”), nor has FNB
or any of its Subsidiaries been advised since January 1, 2005, by any Regulatory Agency or other
Governmental Entity that it is considering issuing, initiating, ordering or requesting any such FNB
Regulatory Agreement. To the knowledge of FNB, there has not been any event or occurrence since
January 1, 2005 that could reasonably be expected to result in a determination that any such bank
Subsidiary is not “well capitalized” and “well managed” as a matter of U.S. federal banking law.
Each bank Subsidiary of FNB has at least a “satisfactory” rating under the U.S. Community
Reinvestment Act.



     4.16 Undisclosed Liabilities. Except for (i) those liabilities that are reflected or
reserved against on the consolidated balance sheet of FNB included in the FNB 10-Q (including any
notes thereto), (ii) liabilities incurred in connection with this Agreement and the transactions
contemplated thereby and (iii) liabilities incurred in the ordinary course of business consistent
with past practice since September 30, 2007, since September 30, 2007, neither FNB nor any of its
Subsidiaries has incurred any liability of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether due or to become due) that, either individually or in the
aggregate, has had or is reasonably likely to have, a Material Adverse Effect on FNB.



     4.17 Environmental Liability.



          (a) To FNB’s Knowledge, (A) FNB and its Subsidiaries are in material compliance with
applicable environmental laws; (B) no real property, including buildings or other structures,
currently or formerly owned or operated by FNB or any of its Subsidiaries, or any property in which
FNB or any of its Subsidiaries has held a security interest, Lien or a fiduciary or management role
(“FNB Loan Property”), has been contaminated with, or has had any release of, any Hazardous
Substance except in material compliance with Environmental Laws; (C) neither FNB nor any of its
Subsidiaries could be deemed the owner




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or operator of, or have actively participated in the management regarding Hazardous Substances
of, any FNB Loan Property that has been contaminated with, or has had any material and unlawful
release to the environment of, any regulated quantity of any Hazardous Substance; (D) neither FNB
nor any of its Subsidiaries has any material liability for any Hazardous Substance disposal or
contamination on any third party property; (E) neither FNB nor any of its Subsidiaries has received
any notice, demand letter, claim or request for information alleging any material violation of, or
liability under, any Environmental Law; (F) neither FNB nor any of its Subsidiaries is subject to
any order, decree, injunction or other agreement with any Governmental Entity or any third party
relating to any Environmental Law; (G) there are no circumstances or conditions (including the
presence of unencapsulated friable asbestos, underground storage tanks, lead products,
polychlorinated biphenyls, prior manufacturing operations, dry-cleaning or automotive services)
involving FNB or any of its Subsidiaries, any currently or formerly owned or operated property, or
any FNB Loan Property, that could reasonably be expected to result in any material claims,
liability or investigations against FNB or any of its Subsidiaries, result in any material
restrictions on the ownership, use or transfer of any property pursuant to any Environmental Law or
materially and adversely affect the value of any FNB Loan Property, (H) FNB has set forth in the
FNB Disclosure Schedule and made available to Omega copies of all environmental reports or studies,
sampling data, correspondence and filings in its possession or reasonably available to it relating
to FNB, its Subsidiaries and any currently owned or operated property of FNB which were prepared in
the last five years and (I) FNB has made available to Omega copies of all environmental reports or
studies, sampling data, correspondence and filings in the possession or reasonably available to it
relating to any currently outstanding FNB Loan and which were prepared for FNB in the last five
years.




          (b) There are no legal, administrative, arbitral or other proceedings, claims, actions, causes
of action, private environmental investigations or remediation activities or governmental
investigations of any nature seeking to impose, or that are reasonably likely to result in the
imposition, on FNB of any liability or obligation arising under common law or under any local,
state or federal environmental statute, regulation or ordinance including the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, pending or threatened
against FNB, which liability or obligation is reasonably likely to have, either individually or in
the aggregate, a Material Adverse Effect on FNB. To the knowledge of FNB, there is no reasonable
basis for any such proceeding, claim, action or governmental investigation that would impose any
liability or obligation that would be reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on FNB. FNB is not subject to any agreement, order, judgment, decree,
letter or memorandum by or with any Governmental Entity or third party imposing any liability or
obligation with respect to the foregoing that is reasonably likely to have, either individually or
in the aggregate, a Material Adverse Effect on FNB.




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     4.18 Reorganization. As of the date of this Agreement, FNB is not aware of any fact
or circumstance that could reasonably be expected to prevent the Merger from qualifying as a
“reorganization” within the meaning of Section 368(a) of the Code.



     4.19 Loans; Nonperforming and Classified Assets.



          (a) Except as set forth in Section 4.19 of the FNB Disclosure Schedule, each Loan on the books
and records of FNB and its Subsidiaries was made and has been serviced in all material respects in
accordance with their customary lending standards in the ordinary course of business, is evidenced
in all material respects by appropriate and sufficient documentation and, to the knowledge of FNB,
constitutes the legal, valid and binding obligation of the obligor named therein, subject to
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws of general
applicability relating to or affecting creditor’s rights or by general equity principles.




          (b) FNB has set forth in Section 4.20 of the FNB Disclosure Schedule as to FNB and each FNB
Subsidiary as of the latest practicable date prior to the date of this Agreement: (A) any written
or, to FNB’s knowledge, oral Loan under the terms of which the obligor is 90 or more days
delinquent in payment of principal or interest, or to FNB’s knowledge, in default of any other
material provision thereof; (B) each Loan that has been classified as “substandard,” “doubtful,”
“loss” or “special mention” or words of similar import by FNB, a FNB Subsidiary or an applicable
regulatory authority; (C) a listing of the OREO acquired by foreclosure or by deed-in-lieu thereof,
including the book value thereof and (D) each Loan with any director, executive officer or five
percent or greater shareholder of FNB or a FNB Subsidiary, or to the knowledge of FNB, any Person
controlling, controlled by or under common control with any of the foregoing.




     4.20 Fiduciary Accounts. FNB and each of its Subsidiaries has properly administered
all accounts for which it acts as a fiduciary, including but not limited to accounts for which it
serves as a trustee, agent, custodian, personal representative, guardian, conservator or investment
advisor, in accordance with the terms of the governing documents and applicable laws and
regulations. Neither FNB nor any of its Subsidiaries, nor any of their respective directors,
officers or employees, has committed any breach of trust to FNB’s knowledge with respect to any
fiduciary account and the records for each such fiduciary account are true and correct and
accurately reflect the assets of such fiduciary account.



     4.21 Allowance for Loan Losses. FNB Bank’s allowance for loan losses is sufficient at
the date of this Agreement for its reasonably anticipated loan losses, is in compliance with the
standards established by applicable Governmental Entities and GAAP and, to the knowledge of FNB, is
adequate.



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ARTICLE V




COVENANTS RELATING TO CONDUCT OF BUSINESS




     5.1 Conduct of Businesses Prior to the Effective Time.



          (a) During the period from the date of this Agreement to the Effective Time, except as
expressly contemplated or permitted by this Agreement, each of FNB and Omega shall, and shall cause
each of its respective Subsidiaries to, (i) conduct its business in the ordinary course in all
material respects, (ii) use reasonable best efforts to maintain and preserve intact its business
organization, employees and advantageous business relationships and retain the services of its key
officers and key employees and (iii) take no action that would reasonably be expected to prevent or
materially impede or delay the obtaining of, or materially adversely affect the ability of the
parties to obtain, any necessary approvals of any Regulatory Agency or other Governmental Entity
required for the transactions contemplated hereby or to perform its covenants and agreements under
this Agreement or to consummate the transactions contemplated hereby or thereby.




          (b) Omega agrees that between the date hereof and the Effective Time, a representative of FNB
shall be permitted to be an observer at the meetings of the Loan Committee of Omega’s Board of
Directors.




     5.2 Omega Forbearances. During the period from the date of this Agreement to the
Effective Time, except as set forth in Section 5.2 of the Omega Disclosure Schedule and except as
expressly contemplated or permitted by this Agreement, Omega shall not, and shall not permit any of
its Subsidiaries to, without the prior written consent of FNB, which shall not be unreasonably
withheld:



          (a) (i) other than dividends and distributions by a direct or indirect Subsidiary of Omega to
Omega or any direct or indirect wholly owned Subsidiary of Omega, declare, set aside or pay any
dividends on, make any other distributions in respect of, or enter into any agreement with respect
to the voting of, any of its capital stock (except for regular quarterly cash dividends with
customary record dates and payment dates and not to exceed $.31 per share on Omega Common Stock),
(ii) split, combine or reclassify any of its capital stock or issue or authorize the issuance of
any other securities in respect of, in lieu of, or in substitution for, shares of its capital
stock, except upon the exercise of Omega Stock Options or settlement of Omega RSUs that are
outstanding as of the date hereof in accordance with their present terms or (iii) purchase, redeem
or otherwise acquire any shares of capital stock or other securities of Omega or any of its
Subsidiaries, or any rights, warrants or options to acquire any such shares or other securities
(other than the issuance of Omega Common Stock upon the exercise of Omega Stock Options or
settlement of Omega RSUs that are outstanding as of the date hereof in accordance with their
present terms, including the




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withholding of shares of Omega Common Stock to satisfy the exercise price or Tax withholding);




          (b) grant any stock options, restricted stock units or other equity-based award with respect
to shares of Omega Common Stock under any of the Omega Stock Plans, or otherwise, or grant any
individual, corporation or other entity any right to acquire any shares of its capital stock; or
issue any additional shares of capital stock or other securities (other than the issuance of Omega
Common Stock upon the exercise of Omega Stock Options or settlement of Omega RSUs that are
outstanding as of the date hereof in accordance with their present terms);




          (c) amend the Omega Articles, Omega Bylaws or other comparable organizational documents;




          (d) (i) acquire or agree to acquire by merging or consolidating with, or by purchasing any
assets or any equity securities of, or by any other manner, any business or any Person, or
otherwise acquire or agree to acquire any assets except inventory or other similar assets in the
ordinary course of business consistent with past practice or (ii) open, acquire, close or sell any
branches;




          (e) sell, lease, license, mortgage or otherwise encumber or subject to any Lien, or otherwise
dispose of any of its properties or assets other than securitizations and other transactions in the
ordinary course of business consistent with past practice;




          (f) except for borrowings having a maturity of not more than 30 days under existing credit
facilities (or renewals, extensions or replacements therefor that do not increase the aggregate
amount available thereunder and that do not provide for any termination fees or penalties, prohibit
pre-payments or provide for any pre-payment penalties, or contain any like provisions limiting or
otherwise affecting the ability of Omega or its applicable Subsidiaries or successors from
terminating or pre-paying such facilities, or contain financial terms less advantageous than
existing credit facilities, and as they may be so renewed, extended or replaced (“Credit
Facilities”) that are incurred in the ordinary course of business consistent with past practice, or
for borrowings under Credit Facilities or other lines of credit or refinancing of indebtedness
outstanding on the date hereof in additional amounts not to exceed $500,000, incur any indebtedness
for borrowed money or issue any debt securities or assume, guarantee or endorse, or otherwise
become responsible for the obligations of any Person (other than Omega or any wholly owned
Subsidiary thereof), or, other than in the ordinary course of business consistent with past
practice, make any loans, advances or capital contributions to, or investments in, any Person other
than its wholly owned Subsidiaries and as a result of ordinary advances and reimbursements to
employees and endorsements of banking instruments;




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          (g) change in any material respect its accounting methods (or underlying assumptions),
principles or practices affecting its assets, liabilities or business, including any reserving,
renewal or residual method, practice or policy, in each case, in effect on the date hereof, except
as required by changes in GAAP or regulatory accounting principles;




          (h) change in any material respects its underwriting, operating, investment or risk management
or other similar policies of Omega or any of its Subsidiaries except as required by applicable law
or policies imposed by any Regulatory Agency or any Governmental Entity;




          (i) make, change or revoke any material Tax election, file any material amended Tax Return,
enter into any closing agreement with respect to a material amount of Taxes, settle any material
Tax claim or assessment or surrender any right to claim a refund of a material amount of Taxes;




          (j) other than in the ordinary course of business consistent with past practice, terminate or
waive any material provision of any material agreement, contract or obligation (collectively,
“Contracts”) other than normal renewals of Contracts without materially adverse changes, additions
or deletions of terms, or enter into or renew any agreement or contract or other binding obligation
of Omega or its Subsidiaries containing (i) any restriction on the ability of Omega and its
Subsidiaries, or, after the Merger, FNB and its Subsidiaries, to conduct its business as it is
presently being conducted or currently contemplated to be conducted after the Merger or (ii) any
restriction on Omega or its Subsidiaries, or, after the Merger, FNB and its Subsidiaries, in
engaging in any type of activity or business;




          (k) incur any capital expenditures in excess of $100,000 individually or $250,000 in the
aggregate;




          (l) except as required by agreements or instruments in effect on the date hereof, alter in any
material respect, or enter into any commitment to alter in any material respect, any material
interest in any corporation, association, joint venture, partnership or business entity in which
Omega directly or indirectly holds any equity or ownership interest on the date hereof (other than
any interest arising from any foreclosure, settlement in lieu of foreclosure or troubled loan or
debt restructuring in the ordinary course of business consistent with past practice);




          (m) agree or consent to any material agreement or material modifications of existing
agreements with any Regulatory Authority or Governmental Entity in respect of the operations of its
business, except as required by law;




          (n) pay, discharge, settle or compromise any claim, action, litigation, arbitration, suit,
investigation or proceeding, other than any such payment, discharge,



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settlement or compromise in the ordinary course of business consistent with past practice that
involves solely money damages in an amount not in excess of $100,000 individually or $500,000 in
the aggregate, and that does not create precedent for other pending or potential claims, actions,
litigation, arbitration or proceedings;




          (o) issue any broadly distributed communication of a general nature to employees (including
general communications relating to benefits and compensation) or customers without the prior
approval of FNB (which will not be unreasonably delayed or withheld), except for communications in
the ordinary course of business that do not relate to the Merger or other transactions contemplated
hereby;




          (p) take any action, or knowingly fail to take any action, which action or failure to act
would be reasonably expected to prevent the Merger from qualifying as a reorganization within the
meaning of Section 368(a) of the Code;




          (q) take any action that would materially impede or delay the ability of the parties to obtain
any necessary approvals of any Regulatory Agency or other Governmental Entity required for the
transactions contemplated hereby;




          (r) take any action that is intended or is reasonably likely to result in any of its
representations or warranties set forth in this Agreement being or becoming untrue in any material
respect at any time prior to the Effective Time, or in any of the conditions to the Merger set
forth in Article VII not being satisfied or in a violation of any provision of this Agreement,
except, in every case, as may be required by applicable law;




          (s) Make, renew or otherwise modify any loan, loan commitment, letter of credit or other
extension of credit (individually, a “Loan” and collectively, “Loans”) to any Person if the Loan is
an existing credit on the books of Omega and classified as “substandard,” “doubtful” or “loss” or
such Loan is in an amount in excess of $500,000 and classified as “special mention” without the
approval of FNB, or make, renew or otherwise modify any Loan or Loans if immediately after making
an unsecured Loan or Loans, such Person would be indebted to Omega Bank in an aggregate amount in
excess of $1,000,000 on an unsecured basis or undersecured, or make any fully secured Loan or Loans
to any Person (except for any Loan secured by a first mortgage on single family owner-occupied real
estate) if, immediately after making a secured Loan, such Person would be indebted to Omega Bank in
an aggregate amount in excess of $5,000,000 or, without approval of FNB, shall not make, renew or
otherwise modify any Loan or Loans secured by an owner-occupied 1-4 single-family residence with a
principal balance in excess of $1,000,000 or in any event if such Loan does not conform with Omega
Bank’s Credit Policy Manual if, in the case of any of the foregoing types of Loan or Loans, FNB
shall object thereto within three business days after receipt of notice of such proposed Loan, and
the failure to provide a written objection within three business days after receipt of notice of
such proposed Loan from Omega Bank shall be deemed as the approval of FNB to make such Loan or
Loans;




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          (t) Enter into or amend or renew any employment, consulting, severance or similar agreements
or arrangements with any director, officer or employee of Omega or its Subsidiaries or grant any
salary or wage increase or increase any employee benefit, including discretionary or other
incentive or bonus payments, except in accordance with the terms of any applicable Omega incentive
plan, or accelerate the vesting of any unvested stock options, except:




               (i) for normal increases in compensation and bonuses to employees in the ordinary course of
business consistent with past practice, provided that no such increases shall result in an annual
aggregate adjustment in compensation or bonus of more than 3.5%, provided, however, that no
increase for any individual shall result in an annual adjustment in compensation or bonus of more
than 5%, unless mutually agreed to by Omega and FNB;



               (ii) for other changes that are required by applicable law or are advisable in order to comply
with Section 409A of the Code;



               (iii) to pay the amounts or to provide payments under plans and/or commitments set forth in
the Omega Disclosure Schedule;



               (iv) for retention bonuses to such persons and in such amounts as are mutually agreed by FNB
and Omega;



               (v) severance payments pursuant to the severance agreements or employment agreements that are
set forth in Section 5.2 of the Omega Disclosure Schedule; or



               (vi) for grants of awards to newly hired employees consistent with past practice.



          (u) Hire any person as an employee of Omega or any of its Subsidiaries or promote any
employee, except (i) to satisfy contractual obligations existing as of the date hereof and set
forth in Section 5.2 of the Omega Disclosure Schedule, or (ii) to fill any vacancies existing as of
the date hereof and described in Section 5.2 of the Omega Disclosure Schedule or (iii) to fill any
vacancies arising after the date hereof at a comparable level of compensation with persons whose
employment is terminable at the will of Omega or a Subsidiary of Omega, as applicable, provided,
however, that such total compensation for any one employee may not exceed $60,000; or




          (v) agree to take, make any commitment to take, or adopt any resolutions of its Board of
Directors in support of, any of the actions prohibited by this Section 5.2.




     5.3 FNB Forbearances. During the period from the date of this Agreement to the
Effective Time, except as expressly contemplated or permitted by this Agreement, FNB shall



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not, and shall not permit any of its Subsidiaries to, without the prior written consent of
Omega:



          (a) amend, repeal or otherwise modify any provision of the FNB Charter or the FNB Bylaws other
than those that would not be adverse to Omega or its shareholders or those that would not impede
FNB’s ability to consummate the transactions contemplated hereby;




          (b) take any action, or knowingly fail to take any action, which action or failure to act
would be reasonably expected to prevent the Merger from qualifying as a reorganization within the
meaning of Section 368(a) of the Code;




          (c) take any action that is intended or is reasonably likely to result in any of its
representations or warranties set forth in this Agreement being or becoming untrue in any material
respect at any time prior to the Effective Time, or in any of the conditions to the Merger set
forth in Article VII not being satisfied or in a violation of any provision of this Agreement,
except, in every case, as may be required by applicable law;




          (d) make any material investment either by purchase of stock or securities, contributions to
capital, property transfers or purchase of any property or assets of any other individual,
corporation or other entity, in any case to the extent such action would be reasonably expected to
prevent, or materially impede or delay, the consummation of the transactions contemplated by this
Agreement;




          (e) take any action that would materially impede or delay the ability of the parties to obtain
any necessary approvals of any Regulatory Agency or other Governmental Entity required for the
transactions contemplated hereby; or




          (f) agree to take, make any commitment to take, or adopt any resolutions of its board of
directors in support of, any of the actions prohibited by this Section 5.3.




     5.4 No Control of Other Party’s Business. Nothing contained in this Agreement is
intended to give FNB, directly or indirectly, the right to control or direct Omega’s or its
Subsidiaries’ operations prior to the Effective Time. Prior to the Effective Time, each of FNB and
Omega shall exercise, consistent with the terms and conditions of this Agreement, complete control
and supervision over its (and its respective Subsidiaries) respective operations.



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ARTICLE VI




ADDITIONAL AGREEMENTS




     6.1 Regulatory Matters.



          (a) FNB agrees to prepare the Registration Statement to be filed by FNB with the SEC in
connection with the issuance of FNB Common Stock in the Merger including the Joint Proxy Statement
and prospectus and other proxy solicitation materials of Omega and FNB constituting a part thereof
and all related documents. Omega shall prepare and furnish to FNB such information relating to it
and its directors, officers and shareholders as may be reasonably required in connection with the
above referenced documents based on its knowledge of and access to the information required for
said documents, and Omega, and its legal, financial and accounting advisors, shall have the right
to review in advance and approve, which approval shall not be unreasonably withheld such
Registration Statement prior to its filing. Omega agrees to cooperate with FNB and FNB’s counsel
and accountants in requesting and obtaining appropriate opinions, consents and letters from its
financial advisor and independent auditor in connection with the Registration Statement and the
Joint Proxy Statement. As long as Omega has cooperated as described above, FNB agrees to file, or
cause to be filed, the Registration Statement and the Joint Proxy Statement with the SEC as
promptly as reasonably practicable. Each of Omega and FNB agrees to use its commercially
reasonable efforts to cause the Registration Statement to be declared effective under the
Securities Act as promptly as reasonably practicable after the filing thereof. FNB also agrees to
use its reasonable best efforts to obtain all necessary state securities law or “Blue Sky” permits
and approvals required to carry out the transactions contemplated by this Agreement. After the
Registration Statement is declared effective under the Securities Act, Omega and FNB shall each
promptly mail at its expense the Joint Proxy Statement to its respective shareholders.




          (b) Each of Omega and FNB agree that none of the information supplied or to be supplied by it
for inclusion or incorporation by reference in the Registration Statement shall, at the time the
Registration Statement and each amendment or supplement thereto, if any, becomes effective under
the Securities Act, contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein not misleading.
Each of Omega and FNB agree that none of the information supplied or to be supplied by it for
inclusion or incorporation by reference in the Joint Proxy Statement and any amendment or
supplement thereto shall contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein not
misleading. Each of Omega and FNB further agree that if such party shall become aware prior to the
Effective Time of any information furnished by such party that would cause any of the statements in
the Registration Statement or the Joint Proxy Statement to be false or misleading with respect to
any material fact, or to omit to state any material fact necessary to make the statements therein
not false or



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misleading, to promptly inform the other parties thereof and an appropriate amendment or
supplement describing such information shall be filed promptly with the SEC and, to the extent
required by law, disseminated to the shareholders of Omega and/or FNB.




          (c) FNB agrees to advise Omega, promptly after FNB receives notice thereof, of the time when
the Registration Statement has become effective or any supplement or amendment has been filed, of
the issuance of any stop order or the suspension of the qualification of FNB Common Stock for
offering or sale in any jurisdiction, of the initiation or, to the extent FNB is aware thereof,
threat of any proceeding for any such purpose, or of any request by the SEC for the amendment or
supplement of the Registration Statement or for additional information.




          (d) The parties shall cooperate with each other and use their respective reasonable best
efforts to promptly prepare and file all necessary documentation, to effect all applications,
notices, petitions and filings, to obtain as promptly as practicable all permits, consents,
approvals and authorizations of all third parties, Regulatory Agencies and Governmental Entities
that are necessary or advisable to consummate the transactions contemplated by this Agreement
(including the Merger), and to comply with the terms and conditions of all such permits, consents,
approvals and authorizations of all such Regulatory Agencies and Governmental Entities. Omega and
FNB shall have the right to review in advance, and, to the extent practicable, each will consult
the other on, in each case subject to applicable laws relating to the exchange of information, all
the information relating to Omega or FNB, as the case may be, and any of their respective
Subsidiaries, which appear in any filing made with, or written materials submitted to, any third
party, Regulatory Agency or any Governmental Entity in connection with the transactions
contemplated by this Agreement. In exercising the foregoing right, each of the parties shall act
reasonably and as promptly as practicable. The parties shall consult with each other with respect
to the obtaining of all permits, consents, approvals and authorizations of all third parties,
Regulatory Agencies and Governmental Entities necessary or advisable to consummate the transactions
contemplated by this Agreement and each party will keep the other apprised of the status of matters
relating to completion of the transactions contemplated by this Agreement. Notwithstanding the
foregoing, nothing in this Agreement shall be deemed to require FNB to take any action, or commit
to take any action, or agree to any condition or restriction, in connection with obtaining the
foregoing permits, consents, approvals and authorizations of third parties, Regulatory Agencies or
Governmental Entities, that would reasonably be expected to have a material adverse effect on FNB
and its Subsidiaries (including the Surviving Company after giving effect to the Merger) taken as a
whole after the Effective Time (a “Materially Burdensome Regulatory Condition”). In addition,
Omega agrees to cooperate and use its reasonable best efforts to assist FNB in preparing and filing
such petitions and filings, and in obtaining such permits, consents, approvals and authorizations
of third parties, Regulatory Agencies and Governmental Entities, that may be



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necessary or advisable to effect any mergers and/or consolidations of Subsidiaries of Omega
and FNB following consummation of the Merger.




          (e) Each of FNB and Omega shall, upon request, furnish to the other all information concerning
itself, its Subsidiaries, directors, officers and shareholders and such other matters as may be
reasonably necessary or advisable in connection with the Joint Proxy Statement, the Registration
Statement or any other statement, filing, notice or application made by or on behalf of FNB, Omega
or any of their respective Subsidiaries to any Regulatory Agency or Governmental Entity in
connection with the Merger and the other transactions contemplated by this Agreement.




          (f) Each of FNB and Omega shall promptly advise the other upon receiving any communication
from any Regulatory Agency or Governmental Entity whose consent or approval is required for
consummation of the transactions contemplated by this Agreement that causes such party to believe
that there is a reasonable likelihood that any Requisite Regulatory Approval (as defined in Section
7.1(c)) will not be obtained or that the receipt of any such approval may be materially delayed.




          (g) Press Releases. Omega and FNB shall consult with each other before issuing any
press release with respect to the Merger or this Agreement and shall not issue any such press
release or make any such public statements without the prior consent of the other party, which
shall not be unreasonably withheld; provided, however, that a party may, without the prior consent
of the other party, but after such consultation, to the extent practicable under the circumstances,
issue such press release or make such public statements as may upon the advice of outside counsel
be required by law or the rules or regulations of the SEC, the FDIC, the OCC, the NYSE or FINRA.
In addition, the Chief Executive Officers of Omega and FNB shall be permitted to respond to
appropriate questions about the Merger from the press. Omega and FNB shall cooperate to develop
all public announcement materials and make appropriate management available at presentations
related to the Merger as reasonably requested by the other party.




     6.2 Access to Information.



          (a) Upon reasonable notice and subject to applicable laws relating to the exchange of
information, each of Omega and FNB shall, and shall cause each of its Subsidiaries to, afford to
the officers, employees, accountants, counsel and other representatives of the other, reasonable
access, during normal business hours during the period prior to the Effective Time, to all its
properties, books, contracts, commitments and records, and, during such period, the parties shall,
and shall cause its Subsidiaries to, make available to the other party all other information
concerning its business, properties and personnel as the other may reasonably request. Omega
shall, and shall cause each of its Subsidiaries to, provide to FNB a copy of each report, schedule,
registration statement and other document filed or received by it during such period pursuant to
the requirements of



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federal securities laws or federal or state banking laws other than reports or documents that
such party is not permitted to disclose under applicable law. Neither Omega nor FNB nor any of
their Subsidiaries shall be required to provide access to or to disclose information where such
access or disclosure would jeopardize the attorney-client privilege of such party or its
Subsidiaries or contravene any law, rule, regulation, order, judgment, decree, fiduciary duty or
binding agreement entered into prior to the date of this Agreement. The parties shall make
appropriate substitute disclosure arrangements under circumstances in which the restrictions of the
preceding sentence apply.




          (b) All information and materials provided pursuant to this Agreement shall be subject to the
provisions of the Confidentiality Agreement entered into between the parties (the “Confidentiality
Agreement”).




          (c) No investigation by either of the parties or their respective representatives shall affect
the representations and warranties of the other set forth in this Agreement.




     6.3 Shareholder Approval.



          (a) Omega shall call a meeting of its shareholders for the purpose of obtaining the requisite
shareholder approval required in connection with this Agreement and the Merger (the “Omega
Shareholder Meeting”), and shall use its reasonable best efforts to cause its meeting to occur as
soon as reasonably practicable. Subject to Section 6.13, the Board of Directors of Omega shall
recommend approval and adoption of this Agreement, the Merger and the other transactions
contemplated hereby, by Omega’s shareholders and shall include such recommendation in the Joint
Proxy Statement (the “Omega Recommendation”). Without limiting the generality of the foregoing,
Omega’s obligations pursuant to the first sentence of this Section 6.3(a) shall not be affected by
the commencement, public proposal, public disclosure or communication to Omega of any Acquisition
Proposal (as defined in Section 6.13(e)). Notwithstanding the foregoing, if this Agreement is
terminated pursuant to Section 8.1, Omega’s obligations pursuant to the first sentence of this
Section 6.3(a) shall terminate.




          (b) FNB shall call a meeting of its shareholders for the purpose of obtaining the requisite
shareholder approval required in connection with this Agreement and the Merger (the “FNB
Shareholder Meeting”), and shall use its reasonable best efforts to cause its meeting to occur as
soon as reasonably practicable. The Board of Directors of FNB shall recommend that FNB’s
shareholders vote in favor of approval and adoption of this Agreement, the Merger, including the
issuance of the shares of FNB Common Stock in connection therewith and the other transactions
contemplated hereby (the “FNB Proposal”). FNB shall include such recommendation in the Joint Proxy
Statement (the “FNB Recommendation”). The Board of Directors of FNB shall use commercially
reasonable efforts to obtain such approval. The FNB Proposal shall be submitted to the
shareholders of FNB at



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the FNB Shareholder Meeting for the purpose of approving the issuance of shares of FNB Common
Stock in connection with the Merger. Notwithstanding the foregoing, if this Agreement is
terminated pursuant to Section 8.1, FNB’s obligations pursuant to the first sentence of this
Section 6.3(b) shall terminate.




     6.4 Commercially Reasonable Efforts; Cooperation. Each of Omega and FNB agrees to
exercise good faith and use its commercially reasonable efforts to satisfy the various covenants
and conditions to Closing in this Agreement, and to consummate the transactions contemplated hereby
as promptly as possible.



     6.5 Affiliates. Omega shall use its reasonable best efforts to cause each director,
executive officer and other person who is an “affiliate” (for purposes of Rule 145 under the
Securities Act) of Omega to deliver to FNB, as soon as practicable after the date of this
Agreement, a written agreement, in the form of Exhibit B.



     6.6 NYSE Approval. FNB shall cause the shares of FNB Common Stock to be issued in the
Merger to be approved for quotation on the NYSE, subject to official notice of issuance, prior to
the Effective Time.



     6.7 Benefit Plans.



          (a) As soon as administratively practicable after the Effective Time, FNB shall take all
reasonable action so that employees of Omega and its Subsidiaries shall be entitled to participate
in each employee benefit plan, program or arrangement of FNB of general applicability with the
exception of FNB’s defined benefit pension plan (the “FNB Plans”) to the same extent as
similarly-situated employees of FNB and its Subsidiaries, it being understood that inclusion of the
employees of Omega and its Subsidiaries in the FNB Plans may occur at different times with respect
to different plans, provided that coverage shall be continued under corresponding Benefit Plans of
Omega and its Subsidiaries until such employees are permitted to participate in the FNB Plans and
provided further, however, that nothing contained herein shall require FNB or any of its
Subsidiaries to make any grants to any former employee of Omega under any discretionary equity
compensation plan of FNB. FNB shall cause each FNB Plans in which employees of Omega and its
Subsidiaries are eligible to participate to recognize, for purposes of determining eligibility to
participate in, the vesting of benefits under the FNB Plans, the service of such employees with
Omega and its Subsidiaries to the same extent as such service was credited for such purpose by
Omega, provided, however, that such service shall not be recognized to the extent that such
recognition would result in a duplication of benefits. Except for the commitment to continue those
Benefit Plans of Omega and its Subsidiaries that correspond to FNB Plans until employees of Omega
and its Subsidiaries are included in such FNB Plans, nothing herein shall limit the ability of FNB
to amend or terminate any of Omega’s Benefit Plans in accordance with and to the extent permitted
by their terms at any time permitted by such terms.




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          (b) At and following the Effective Time, and except as otherwise provided in Section 6.7(d)
FNB shall honor, and the Surviving Company shall continue to be obligated to perform, in accordance
with their terms, all benefit obligations to, and contractual rights of, current and former
employees of Omega and its Subsidiaries and current and former directors of Omega and its
Subsidiaries existing as of the Effective Date, as well as all employment, executive severance or
“change-in-control” or similar agreements, plans or policies of Omega that are set forth on
Schedule 6.7(b) of the Omega Disclosure Schedule, subject to the receipt of any necessary approval
from any Governmental Entity. The severance or termination payments that are payable pursuant to
such agreements, plans or policies of Omega are set forth on Schedule 6.7(b) of the Omega
Disclosure Schedule. Following the consummation of the Merger and for one year thereafter, FNB
shall, to the extent not duplicative of other severance benefits, pay employees of Omega or its
Subsidiaries who are terminated for other than cause, severance as set forth on Schedule 6.7(b) of
the FNB Disclosure Schedule. Following the expiration of the foregoing severance policy, any years
of service recognized for purposes of this Section 6.7(b) will be taken into account under the
terms of any applicable severance policy of FNB or its Subsidiaries.




          (c) At such time as employees of Omega and its Subsidiaries become eligible to participate in
a medical, dental or health plan of FNB or its Subsidiaries, FNB shall cause each such plan to (i)
waive any preexisting condition limitations to the extent such conditions are covered under the
applicable medical, health or dental plans of FNB and (ii) waive any waiting period limitation or
evidence of insurability requirement that would otherwise be applicable to such employee or
dependent on or after the Effective Time to the extent such employee or dependent had satisfied any
similar limitation or requirement under an analogous Benefit Plan prior to the Effective Time.




          (d) Immediately prior to the Effective Time, Omega shall, at the written request of FNB,
freeze or terminate such of the Omega Benefit Plans as is requested by FNB, including Omega’s
401(k) Plan.




     6.8 Indemnification; Directors’ and Officers’ Insurance.



          (a) In the event of any threatened or actual claim, action, suit, proceeding or investigation,
whether civil, criminal or administrative, including any such claim, action, suit, proceeding or
investigation (each a “Claim”) in which any individual who is now, or has been at any time prior to
the date of this Agreement, or who becomes prior to the Effective Time, a director or officer of
Omega or any of its Subsidiaries or who is or was serving at the request of Omega or any of its
Subsidiaries as a director or officer of another Person (the “Indemnified Parties”), is, or is
threatened to be, made a party based in whole or in part on, or arising in whole or in part out of,
or pertaining to (i) the fact that he is or was a director or officer of Omega or any of its
Subsidiaries or was serving at the request of Omega or any of its Subsidiaries as a director or
officer of another Person or (ii) this Agreement or any of the transactions contemplated by this
Agreement, whether asserted or arising before or after the




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Effective Time, the parties shall cooperate and use their best efforts to defend against and
respond thereto. From and after the Effective Time, FNB shall, and shall cause the Surviving
Company to, indemnify, defend and hold harmless, as and to the fullest extent currently provided
under applicable law, the Omega Articles, the Omega Bylaws and any agreement set forth in Section
6.8 of the Omega Disclosure Schedule, each such Indemnified Party against any losses, claims,
damages, liabilities, costs, expenses (including reimbursement for reasonable fees and expenses,
including fees and expenses of legal counsel, incurred in advance of the final disposition of any
claim, suit, proceeding or investigation upon receipt of any undertaking required by applicable
law), judgments, fines and amounts paid in settlement in connection with any such threatened or
actual claim, action, suit, proceeding or investigation.




          (b) FNB and the Surviving Company agree that all rights to indemnification of liabilities
(including advancement of expenses), and all limitations with respect thereto, existing in favor of
any Indemnified Person, as provided in the Omega Articles or the Omega Bylaws, shall survive the
Merger and shall continue in full force and effect, without any amendment thereto; provided,
however, that in the event any Claim is asserted or made, any determination required to be made
with respect to whether an Indemnified Person’s conduct complies with the standards set forth under
the PBCL, the Omega Articles or the Omega Bylaws, as the case may be, shall be made by independent
legal counsel (whose fees and expenses shall be paid by FNB and the Surviving Company) selected by
such Indemnified Person and reasonably acceptable to FNB; and provided further that nothing in this
Section 6.8 shall impair any rights or obligations of any current or former director or officer of
Omega or its Subsidiaries, including pursuant to the respective organizational documents of Omega,
or their respective Subsidiaries, under the PBCL or otherwise.




          (c) Prior to the Effective Time, Omega shall obtain at the expense of FNB, and FNB shall
maintain for a period of six years following the Effective Time, directors’ and officers’ liability
insurance and fiduciary liability insurance policies in respect of acts or omissions occurring at
or prior to the Effective Time, including the transactions contemplated hereby, covering the
Indemnified Persons who are currently covered by Omega’s directors’ and officers’ liability
insurance or fiduciary liability insurance policies, provided that FNB may substitute therefor
policies of at least the same coverage and amounts containing terms and conditions that are not
less advantageous than such policies of Omega or single premium tail coverage with policy limits
equal to Omega’s existing coverage limits, provided that in no event shall FNB be required to
expend for any one year an amount in excess of 150% of the annual premium currently paid by Omega
for such insurance (the “Insurance Amount”), and further provided that if FNB is unable to maintain
or obtain the insurance called for by this Section 6.8(c) as a result of the preceding provision,
FNB shall use its commercially reasonable best efforts to obtain the most advantageous coverage as
is available for the Insurance Amount. The provisions of the immediately preceding sentence shall
be deemed to have been satisfied if prepaid policies have been obtained prior to the Effective Time
from



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an insurer or insurers that have an insurer financial strength rating by A.M. Best Co. of at
least “A,” which policies provide the Indemnified Persons with coverage, from the Effective Time to
the sixth anniversary of the Effective Time, including in respect of the transactions contemplated
hereby, on terms that are no less advantageous to Indemnified Persons than Omega’s D&O Insurance
existing immediately prior to the date hereof. If such prepaid policies have been obtained prior
to the Effective Time, then the FNB shall maintain such policies in full force and effect and
continue the obligations thereunder.




          (d) The provisions of this Section 6.8 shall survive the Effective Time and are intended to be
for the benefit of, and shall be enforceable by, each Indemnified Party and his or her heirs and
representatives.




     6.9 Additional Agreements. In case at any time after the Effective Time any further
action is necessary or desirable to carry out the purposes of this Agreement (including any merger
between a Subsidiary of FNB, on the one hand, and a Subsidiary of Omega, on the other) or to vest
the Surviving Company with full title to all properties, assets, rights, approvals, immunities and
franchises of either party to the Merger, the proper officers and directors of each party and their
respective Subsidiaries shall take all such necessary action as may be reasonably requested by, and
at the sole expense of, FNB.



     6.10 Advice of Changes. Each of FNB and Omega shall promptly advise the other of any
change or event (i) having or reasonably likely to have a Material Adverse Effect on it or (ii)
that it believes would or would be reasonably likely to cause or constitute a material breach of
any of its representations, warranties or covenants contained in this Agreement; provided, however,
that no such notification shall affect the representations, warranties, covenants or agreements of
the parties (or remedies with respect thereto) or the conditions to the obligations of the parties
under this Agreement; provided, further, that a failure to comply with this Section 6.10 shall not
constitute the failure of any condition set forth in Article VII to be satisfied unless the
underlying Material Adverse Effect or material breach would independently result in the failure of
a condition set forth in Article VII to be satisfied.



     6.11 Dividends. After the date of this Agreement, Omega shall coordinate with FNB the
declaration of any dividends in respect of Omega Common Stock and the record dates and payment
dates relating thereto such that holders of Omega Common Stock shall not receive two dividends, or
fail to receive one dividend, for any quarter with respect to their shares of Omega Common Stock
and any shares of FNB Common Stock any such holder receives in exchange therefor in the Merger.



     6.12 Exemption from Liability Under Section 16(b). Prior to the Effective Time, FNB
and Omega shall take such steps as may be required to cause any acquisitions or dispositions of
capital stock of FNB or Omega (including derivative securities thereof) resulting from the
transactions contemplated by this Agreement by each individual who is subject to the



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reporting requirements of Section 16(a) of the Exchange Act with respect to Omega to be exempt
under Rule 16b-3 of the 1934 Act.



     6.13 Certain Actions.



          (a) From the date of this Agreement through the Effective Time, except as otherwise permitted
by this Section 6.13, Omega will not, and will not authorize or permit any of its directors,
officers, agents, employees, investment bankers, attorneys, accountants, advisors, agents,
Affiliates or representatives (collectively, “Omega Representatives”) to, directly or indirectly,
(i) initiate, solicit, encourage or take any action to facilitate, including by way of furnishing
information, any Acquisition Proposal (as defined in Section 6.13(e)(i)) or any inquiries with
respect to or the making of any Acquisition Proposal, (ii) enter into or participate in any
discussions or negotiations with, furnish any information relating to Omega or any of its
Subsidiaries or afford access to the business, properties, assets, books or records of Omega or any
of its Subsidiaries to, otherwise cooperate in any way with, or knowingly assist, participate in,
facilitate or encourage any effort by any third party that is seeking to make, or has made, an
Acquisition Proposal or (iii) except in accordance with Section 8.1(g), approve, endorse or
recommend or enter into any letter of intent or similar document or any contract, agreement or
commitment contemplating or otherwise relating to an Acquisition Proposal.




          (b) Notwithstanding anything herein to the contrary, Omega and its Board of Directors shall be
permitted (i) to comply with Rule 14d-9 and Rule 14e-2 promulgated under the Exchange Act with
regard to an Acquisition Proposal provided that the Board of Directors of Omega shall not withdraw
or modify in a manner adverse to FNB the Omega Recommendation except as set forth in subsection
(iii) below; (ii) to engage in any discussions or negotiations with, and provide any information
to, any third party in response to a Superior Proposal (as defined in Section 6.13(e)(ii)) by any
such third party, if and only to the extent that (x) Omega’s Board of Directors concludes in good
faith, after consultation with outside counsel, that failure to do so could reasonably be expected
to breach its fiduciary duties under applicable law, (y) prior to providing any information or data
to any third party in connection with a Superior Proposal by any such third party, Omega’s Board of
Directors receives from such third party an executed confidentiality agreement, which
confidentiality terms shall be no less favorable to Omega than those contained in the
Confidentiality Agreement between Omega and FNB, a copy of which executed confidentiality agreement
shall have been provided to FNB for informational purposes and (z) at least 72 hours prior to
providing any information or data to any third party or entering into discussions or negotiations
with any third party, Omega promptly notifies FNB in writing of the name of such third party and
the material terms and conditions of any such Superior Proposal and (iii) to withdraw, modify,
qualify in a manner adverse to FNB, condition or refuse to make the Omega Recommendation (the
“Change in Omega Recommendation”) if Omega’s Board of Directors concludes in good faith, after
consultation with outside counsel and financial



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advisors, that failure to do so could reasonably be expected to breach its fiduciary duties
under applicable law.




          (c) Omega will promptly, and in any event within 24 hours, notify FNB in writing of the
receipt of any Acquisition Proposal or any information related thereto, which notification shall
describe the Acquisition Proposal and identify the third party making the same.




          (d) Omega agrees that it will, and will cause the Omega Representatives to, immediately cease
and cause to be terminated any activities, discussions or negotiations existing as of the date of
this Agreement with any parties conducted heretofore with respect to any Acquisition Proposal.




          (e) For purposes of this Agreement:




               (i) The term “Acquisition Proposal” means any inquiry, proposal or offer, filing of any
regulatory application or notice, whether in draft or final form, or disclosure of an intention to
do any of the foregoing from any person relating to any (w) direct or indirect acquisition or
purchase of a business that constitutes a substantial (i.e., 20% or more) portion of the net
revenues, net income or net assets of Omega and its Subsidiaries, taken as a whole, (x) direct or
indirect acquisition or purchase of Omega Common Stock after the date of this Agreement by a Person
who on the date of this Agreement does not own 10% or more of Omega Common Stock and such Person by
reason of such purchase or acquisition first becomes the owner of 10% or more of Omega Common Stock
after the date of this Agreement or the direct or indirect acquisition or purchase of 5% or more of
Omega Common Stock after the date of this Agreement by a Person who on the date of this Agreement
owns 10% or more of Omega Common Stock, (y) tender offer or exchange offer that if consummated
would result in any Person beneficially owning 10% or more of any class of equity securities of
Omega or (z) merger, consolidation, business combination, recapitalization, liquidation,
dissolution or similar transaction involving Omega other than the transactions contemplated by this
Agreement.



               (ii) The term “Superior Proposal” means any bona fide, unsolicited written Acquisition
Proposal made by a Third Party to acquire more than 50% of the combined voting power of the shares
of Omega Common Stock then outstanding or all or substantially all of Omega’s consolidated assets
for consideration consisting of cash and/or securities that is on terms that the Board of Directors
of Omega in good faith concludes, after consultation with its financial advisors and outside
counsel, taking into account, among other things, all legal, financial, regulatory and other
aspects of the proposal and the person making the proposal, including any break-up fees, expense
reimbursement provisions and conditions to consummation, (A) is on terms that the Board of
Directors of Omega in its good faith judgment believes to be more favorable to Omega than the
Merger; (B) for which financing, to the extent required, is then fully committed or reasonably
determined to be



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available by the Board of Directors of Omega and (C) is reasonably capable of being completed.



          (f) If a Payment Event (as defined in Section 6.13(g)) occurs, Omega shall pay to FNB by wire
transfer of immediately available funds, within two business days following such Payment Event, a
fee of $15,000,000 (the “Break-up Fee”), provided, however, that if a Payment Event occurs, Omega
shall have no obligation to pay FNB’s expenses under Section 9.3(b).




          (g) The term “Payment Event” means any of the following:




               (i) the termination of this Agreement by FNB pursuant to Section 8.1(f)(i);



               (ii) the termination of this Agreement by Omega pursuant to Section 8.1(g);



               (iii) the termination of this Agreement pursuant to any other Section following the
commencement of a tender offer or exchange offer for 25% or more of the outstanding shares of Omega
Common Stock and Omega shall not have sent to its shareholders, within 10 business days after the
commencement of such tender offer or exchange offer, a statement that the Board of Directors of
Omega recommends rejection of such tender offer or exchange offer; or



               (iv) the occurrence of any of the following events within 18 months of the termination of this
Agreement pursuant to Section 8.1(e)(i), provided that an Acquisition Proposal shall have been made
by a Third Party after the date hereof and prior to such termination that shall not have been
withdrawn in good faith prior to such termination: (A) Omega enters into an agreement to merge
with or into, or be acquired, directly or indirectly, by merger or otherwise by, such Third Party;
(B) such Third Party, directly or indirectly, acquires substantially all of the total assets of
Omega and its Subsidiaries, taken as a whole; or (C) such Third Party, directly or indirectly,
acquires more than 50% of the outstanding shares of Omega Common Stock. As used herein, “Third
Party” means any person as defined in Section 13(d) of the Exchange Act other than FNB or its
Affiliates.



          (h) Omega acknowledges that the agreements contained in Section 6.13(e) are an integral part
of the transactions contemplated in this Agreement and that without these agreements FNB would not
enter into this Agreement. Accordingly, in the event Omega fails to pay to FNB the Break-up Fee,
promptly when due, Omega shall, in addition thereto, pay to FNB all costs and expenses, including
attorneys’ fees and disbursements, incurred in collecting such Break-up Fee together with interest
on the amount of the Break-up Fee or any unpaid portion thereof, from the date such payment was due
until the date such



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payment is received by FNB, accrued at the fluctuating prime rate as quoted in The Wall Street
Journal as in effect from time to time during the period.




     6.14 Transition. Commencing following the date hereof, FNB and Omega shall, and shall
cause their respective Subsidiaries to, use their reasonable best efforts to facilitate the
integration, from and after the Closing, of Omega and its Subsidiaries with the businesses of FNB
and its Subsidiaries. Without limiting the generality of the foregoing, from the date hereof
through the Closing Date and consistent with the performance of their day-to-day operations, the
continuous operation of Omega and its Subsidiaries in the ordinary course of business and
applicable law, Omega shall cause the employees and officers of Omega and its Subsidiaries,
including the Bank, to cooperate with FNB in performing tasks reasonably required in connection
with such integration.



     6.15 Certain Post-Closing Matters.



          (a) FNB shall take all action necessary to appoint or elect, effective as of the Effective
Time, as directors of FNB the Omega Designees. Such persons shall fill vacancies on the FNB Board
of Directors in classes to be mutually agreed upon by FNB and Omega and shall serve until their
successors are elected and qualified. Consistent with the fiduciary duties of the FNB Board, FNB
agrees that to the extent that any Omega Designee dies or becomes incapacitated or is unwilling to
serve prior to the Effective Time, Omega and FNB shall mutually agree upon a substitute person to
serve as successor, and provided that such person is reasonably acceptable to the FNB Board, such
person shall be appointed to fill the vacancy so created. Consistent with its fiduciary duties,
the FNB Board of Directors agrees to recommend the Omega Designees for nomination as the FNB Board
of Directors at the annual meeting of FNB’s shareholders at which their respective terms shall
expire.




          (b) FNB agrees to take all action necessary to appoint or elect, effective as of the Effective
Time, as directors of FNB Bank four current members of the Board of Directors of Omega (the “Omega
Bank Designees”) as are mutually agreed by FNB and Omega. Each of the Omega Bank Designees shall
serve until the election of his or her successor. FNB agrees to cause the FNB Bank Board to
recommend the annual reelection of the Omega Bank Designees through FNB Bank’s annual meeting of
shareholders in 2010.




          (c) FNB shall cause FNB Bank to establish and maintain for at least three years after the
Effective Date a community advisory board of directors (the “Omega Advisory Board”). The Omega
Advisory Board shall be formed by FNB Bank and be operated in a manner that is consistent with FNB
Bank’s past practices with respect to its existing community advisory boards. For not less than
two years following the Effective Date, the membership of the Omega Advisory Board shall consist of
the current members of the Omega Board of Directors, subject to confirmation of such initial
members by the Nominating and Corporate Governance Committee of FNB.




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          (d) (a) From and after the Effective Time, FNB shall cause FNB Bank to establish a new region
that will consist of certain central and northeastern Pennsylvania branches of Omega and, at FNB’s
discretion, FNB Bank.




          (e) The commitments set forth in this Section 6.15 shall survive the Effective Time as
reflected in a formal resolution of the FNB Board and the FNB Bank Board to be reflected in the
minutes of FNB as the Surviving Company of the Merger and FNB Bank as the Surviving Bank in the
Bank Merger. The members of the Omega Advisory Board shall be deemed to be third party
beneficiaries of the commitments set forth in this Section 6.15.




ARTICLE VII




CONDITIONS PRECEDENT




     7.1 Conditions to Each Party’s Obligation to Effect the Merger. The respective
obligations of the parties to effect the Merger shall be subject to the satisfaction or waiver,
where permitted by applicable law, at or prior to the Effective Time of the following conditions:



          (a) Shareholder Approval. This Agreement and the Merger contemplated hereby shall
have been approved and adopted by the requisite affirmative vote of the holders of Omega Common
Stock entitled to vote thereon and this Agreement and the Merger contemplated thereby, including
the issuance of shares of FNB Common Stock under this Agreement and the Merger contemplated hereby,
shall have been approved by the requisite affirmative vote of the holders of FNB Common Stock
entitled to vote thereon.




          (b) NYSE Listing. The shares of FNB Common Stock to be issued to the holders of Omega
Common Stock upon consummation of the Merger shall have been authorized for quotation on the NYSE,
subject to official notice of issuance.




          (c) Regulatory Approvals. All regulatory approvals set forth in Sections 3.4 and 4.4
required to consummate the transactions contemplated by this Agreement, including the Merger, shall
have been obtained and shall remain in full force and effect and all statutory waiting periods in
respect thereof shall have expired (all such approvals and the expiration of all such waiting
periods being referred as the “Requisite Regulatory Approvals”).




          (d) Registration Statement. The Registration Statement shall have become effective
under the Securities Act and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have been initiated or
threatened by the SEC.




          (e) No Injunctions or Restraints; Illegality. No order, injunction or decree issued
by any court or agency of competent jurisdiction or other legal restraint or prohibition




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(an “Injunction”) preventing the consummation of the Merger or any of the other transactions
contemplated by this Agreement shall be in effect. No statute, rule, regulation, order, Injunction
or decree shall have been enacted, entered, promulgated or enforced by any Governmental Entity that
prohibits or makes illegal consummation of the Merger.




     7.2 Conditions to Obligation of FNB to Effect the Merger. The obligation of FNB to
effect the Merger is also subject to the satisfaction or waiver by FNB, where permitted by
applicable law, at or prior to the Effective Time, of the following conditions:



          (a) Representations and Warranties. The representations and warranties of Omega
contained in this Agreement that are qualified by materiality or contained in Section 3.2 shall be
true and correct as of the date of this Agreement and as of the Closing Date as though made on and
as of the Closing Date and the representations and warranties of Omega contained in this Agreement
that are not so qualified shall be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date as though made on and as of the Closing Date (except in each
case to the extent any such representation or warranty expressly speaks as of an earlier specified
date, in which case, as of such date), except in each case where the failure of the representations
and warranties (other than the representations and warranties set forth in Section 3.2) to be so
true and correct (without giving effect to any qualification as to “material,” “materiality,”
“material adverse effect” or similar qualifications) are not, individually or in the aggregate,
reasonably likely to result in a Material Adverse Effect on Omega; and FNB shall have received a
certificate signed on behalf of Omega by the Chief Executive Officer or the Chief Financial Officer
of Omega to the foregoing effect.




          (b) Performance of Obligations of Omega. Omega shall have performed in all material
respects all obligations required to be performed by it under this Agreement at or prior to the
Closing Date; and FNB shall have received a certificate signed on behalf of Omega by the Chief
Executive Officer or the Chief Financial Officer of Omega to such effect.




          (c) Federal Tax Opinion. FNB shall have received the opinion of its counsel, Duane
Morris LLP, in form and substance reasonably satisfactory to FNB, dated the Closing Date, to the
effect that, on the basis of facts, representations and assumptions set forth in such opinion, the
Merger will be treated as a reorganization within the meaning of Section 368(a) of the Code. In
rendering such opinion, counsel may require and rely upon representations contained in certificates
of officers of Omega and FNB, reasonably satisfactory in form and substance to it.




          (d) Environmental Reports. At the request of FNB, Omega shall have furnished FNB with
a Phase I environmental study with respect to all real property owned by Omega or any of its
Subsidiaries (which Phase I environmental study shall be at the sole cost and expense of FNB), the
findings of which shall be commercially acceptable to FNB who shall not unreasonably withhold such
acceptance.




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          (e) No Materially Burdensome Regulatory Condition. None of the Requisite Regulatory
Approvals shall have resulted in the imposition of a Materially Burdensome Regulatory Condition.




     7.3 Conditions to Obligation of Omega to Effect the Merger. The obligation of Omega
to effect the Merger is also subject to the satisfaction or waiver by Omega, where permitted by
applicable law, at or prior to the Effective Time of the following conditions:



          (a) Representations and Warranties. The representations and warranties of FNB
contained in this Agreement that are qualified by materiality shall be true and correct as of the
date of this Agreement and as of the Closing Date as though made on and as of the Closing Date and
the representations and warranties of FNB contained in this Agreement that are not so qualified
shall be true and correct in all material respects as of the date of this Agreement and as of the
Closing Date as though made on and as of the Closing Date (except in each case to the extent any
such representation or warranty expressly speaks as of an earlier specified date, in which case, as
of such date), except in each case where the failure of the representations and warranties to be so
true and correct (without giving effect to any qualification as to “material,” “materiality,”
“material adverse effect” or similar qualifications) are not, individually or in the aggregate,
reasonably likely to result in a Material Adverse Effect on FNB; and Omega shall have received a
certificate signed on behalf of FNB by the Chief Executive Officer or the Chief Financial Officer
of FNB to the foregoing effect.




          (b) Performance of Obligations of FNB. FNB shall have performed in all material
respects all obligations required to be performed by it under this Agreement at or prior to the
Closing Date, and Omega shall have received a certificate signed on behalf of FNB by the Chief
Executive Officer or the Chief Financial Officer of FNB to such effect.




          (c) Federal Tax Opinion. Omega shall have received the opinion of its counsel, Blank
Rome LLP, in form and substance reasonably satisfactory to Omega, dated the Closing Date, to the
effect that, on the basis of facts, representations and assumptions set forth in such opinion, the
Merger will be treated as a reorganization within the meaning of Section 368(a) of the Code. In
rendering such opinion, counsel may require and rely upon representations contained in certificates
of officers of Omega and FNB, reasonably satisfactory in form and substance to it.




ARTICLE VIII




TERMINATION AND AMENDMENT




     8.1 Termination. This Agreement may be terminated at any time prior to the Effective
Date, and the Merger may be abandoned:



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          (a) Mutual Consent. By the mutual consent in writing of FNB and Omega if the Board of
Directors of each so determines by vote of a majority of the members of its entire Board.




          (b) Breach.




               (i) By FNB, if (A) any of the representations and warranties of Omega contained in this
Agreement shall fail to be true and correct such that the condition set forth in Section 7.2(a)
would not be satisfied or (B) Omega shall have breached or failed to comply with any of its
obligations under this Agreement such that the conditions set forth in Sections 7.1 or 7.2(b) would
not be satisfied, in either case other than as a result of a material breach by FNB of any of its
obligations under this Agreement and such failure or breach with respect to any such
representation, warranty or obligation cannot be cured, or, if curable, shall continue unremedied
for a period of 30 days after Omega has received written notice from FNB of the occurrence of such
failure or breach, but in no event shall such 30-day period extend beyond June 30, 2008.



               (ii) By Omega, if (A) any of the representations and warranties of FNB contained in this
Agreement shall fail to be true and correct such that the condition set forth in Section 7.3(a)
would not be satisfied or (B) FNB shall have breached or failed to comply with any of its
obligations under this Agreement such that the conditions set forth in Sections 7.1 or 7.3(b) would
not be satisfied, in either case other than as a result of a material breach by Omega of any of its
obligations under this Agreement and such failure or breach with respect to any such
representation, warranty or obligation cannot be cured, or, if curable, shall continue unremedied
for a period of 30 days after FNB has received written notice from Omega of the occurrence of such
failure or breach, but in no event shall such 30-day period extend beyond June 30, 2008.



          (c) Delay. By FNB or Omega, if its Board of Directors so determines by vote of a
majority of the members of its entire Board, in the event that the Merger is not consummated on or
before 5:00 p.m., Eastern Daylight Time on June 30, 2008, except to the extent that the failure of
the Merger then to be consummated by such date shall be due to the failure of the party seeking to
terminate pursuant to this Section 8.1(c) to perform or observe the covenants and agreements of
such party set forth in this Agreement.




          (d) No Regulatory Approval. By FNB or Omega, if its Board of Directors so determines
by a vote of a majority of the members of its entire Board, in the event the approval of any
Governmental Entity required for consummation of the Merger contemplated by this Agreement shall
have been denied by final nonappealable action of such Governmental Entity or an application
therefor shall have been permanently withdrawn at the request of a Governmental Entity, provided,
however, that no party shall have the right to terminate this Agreement pursuant to this Section
8.1(d) if such denial shall be due to



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the failure of the party seeking to terminate this Agreement to perform or observe the
covenants of such party set forth herein.




          (e) No Omega or FNB Shareholder Approval.




               (i) By FNB, or by Omega provided that Omega shall not be in material breach of any of its
obligations under Section 6.3(a), if any approval of the shareholders of Omega contemplated by this
Agreement shall not have been obtained by reason of the failure to obtain the required vote at the
Omega Shareholder Meeting or at any adjournment or postponement thereof.



               (ii) By Omega, or by FNB provided that FNB shall not be in material breach of any of its
obligations under Section 6.3(b), if any approval of the shareholders of FNB contemplated by this
Agreement shall not have been obtained by reason of the failure to obtain the required vote at the
FNB Shareholder Meeting or any adjournment or postponement thereof.



     (f) Failure to Recommend.



               (i) At any time prior to the Omega Shareholder Meeting, by FNB if (i) Omega shall have
breached Section 6.13(a) in any respect materially adverse to FNB, (ii) the Omega Board of
Directors shall have failed to make the Omega Recommendation or shall have effected a Change in
Omega Recommendation, (iii) the Omega Board shall have recommended approval of an Acquisition
Proposal or (iv) Omega shall have materially breached its obligations under Section 6.3(a) by
failing to call, give notice of, convene and hold the Omega Shareholder Meeting.



               (ii) At any time prior to the FNB Shareholder Meeting, by Omega if (i) the FNB Board of
Directors shall have failed to make the FNB Recommendation or (ii) FNB shall have materially
breached its obligations under Section 6.3(b) by failing to call, give notice of, convene and hold
the FNB Shareholder Meeting.



          (g) Superior Proposal. At any time prior to the date of mailing of the Joint Proxy
Statement, by Omega in order to enter concurrently into an Acquisition Proposal that has been
received by Omega and the Omega Board of Directors in compliance with Sections 6.13 (a) and (b) and
that Omega’s Board of Directors concludes in good faith, in consultation with its financial and
legal advisors, that such Acquisition Proposal is a Superior Proposal; provided, however, that this
Agreement may be terminated by Omega pursuant to this Section 8.1(g) only after the fifth business
day following Omega’s provision of written notice to FNB advising FNB, that the Omega Board of
Directors is prepared to accept a Superior Proposal (it being agreed that the delivery of such
notice shall not entitle FNB to terminate this Agreement pursuant to Section 8.1(g)) and only if
(i) during such five-business day period, Omega has caused its financial and legal advisors to
negotiate with FNB in good faith



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to make such adjustments in the terms and conditions of this Agreement such that such
Acquisition Proposal would no longer constitute a Superior Proposal, (ii) Omega’s Board of
Directors has considered such adjustments in the terms and conditions of this Agreement resulting
from such negotiations and has concluded in good faith, based upon consultation with its financial
and legal advisers, that such Acquisition Proposal remains a Superior Proposal even after giving
effect to the adjustments proposed by FNB and further provided that such termination shall not be
effective until Omega has paid the Break-up Fee to FNB.




     8.2 Effect of Termination. In the event of termination of this Agreement by either
FNB or Omega as provided in Section 8.1, this Agreement shall forthwith become void and have no
effect except (i) Sections 6.1(g), 6.2(b), 6.13(f)-(h), 8.2, 8.3, 9.3 and 9.8 shall survive any
termination of this Agreement and (ii) notwithstanding anything to the contrary contained in this
Agreement, no party shall be relieved or released from any liability or damages arising out of its
willful breach of any of the provisions of this Agreement.



     8.3 Amendment. Subject to compliance with applicable law and Section 1.1(b), this
Agreement may be amended by the parties, by action taken or authorized by their respective Boards
of Directors at any time before or after approval of the matters presented in connection with
Merger by the shareholders of Omega or the shareholders of FNB; provided, however, that after any
approval of the transactions contemplated by this Agreement by the shareholders of Omega and FNB,
there may not be, without further approval of their shareholders, any amendment of this Agreement
that requires such further approval under applicable law. This Agreement may not be amended except
by an instrument in writing signed on behalf of each of the parties.



     8.4 Extension; Waiver. At any time prior to the Effective Time, the parties, by
action taken or authorized by their respective Board of Directors, may, to the extent legally
allowed, (i) extend the time for the performance of any of the obligations or other acts of the
other party, (ii) waive any inaccuracies in the representations and warranties contained in this
Agreement and (iii) waive compliance with any of the agreements or conditions contained in this
Agreement; provided, however, that after any approval of the transactions contemplated by this
Agreement by the shareholders of Omega and FNB, there may not be, without further approval of their
shareholders, any extension or waiver of this Agreement or any portion hereof that changes the
amount or form of the consideration to be delivered to the holders of Omega Common Stock and the
holders of FNB Common Stock under this Agreement, other than as contemplated by this Agreement.
Any agreement on the part of a party to any such extension or waiver shall be valid only if set
forth in a written instrument signed on behalf of such party, but such extension or waiver or
failure to insist on strict compliance with an obligation, covenant, agreement or condition shall
not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.



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ARTICLE IX




GENERAL PROVISIONS




     9.1 Closing. On the terms and subject to conditions set forth in this Agreement, the
closing of the Merger (the “Closing”) shall take place at 10:00 a.m. on a date and at a place to
be specified by the parties, which date shall be no later than five business days after the
satisfaction or waiver (subject to applicable law) of the latest to occur of the conditions set
forth in Article VII (other than those conditions that by their nature are to be satisfied or
waived at the Closing), unless extended by mutual agreement of the parties (the “Closing Date”).



     9.2 Nonsurvival of Representations, Warranties and Agreements. None of the
representations, warranties, covenants and agreements set forth in this Agreement or in any
instrument delivered pursuant to this Agreement shall survive the Effective Time, except for
Articles I , II and IX and Sections 6.7, 6.8, 6.9 and 6.15.



     9.3 Expenses.



          (a) Each party hereto will bear all expenses incurred by it in connection with this Agreement
and the transactions contemplated hereby, including fees and expenses of its own financial
consultants, accountants and counsel, except that expenses of printing the Joint Proxy Statement
and the registration fee to be paid to the SEC in connection with the Registration Statement shall
be shared equally between Omega and FNB, and provided further that nothing contained herein shall
limit either party’s rights to recover any liabilities or damages arising out of the other party’s
willful breach of any provision of this Agreement.




          (b) In the event that this Agreement is terminated by:




     (i) FNB pursuant to Section 8.1(b)(i);




	 	(ii)	 	Omega pursuant to Section 8.1(b)(ii);
	 
	 	(iii)	 	FNB pursuant to Section 8.1(e)(i); or
	 
	 	(iv)	 	Omega pursuant to Section 8.1(e)(ii),




then the non-terminating party shall pay to the terminating party by wire transfer of immediately
available funds, within two business days following delivery of a statement of such expenses, all
out-of-pocket costs and expenses, up to a maximum of $500,000, including without limitation,
professional fees of legal counsel, financial advisors and accountants, and their expenses,
actually incurred by the terminating party in connection with the Merger and this Agreement.




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          9.4 Notices. All notices and other communications in connection with this Agreement
shall be in writing and shall be deemed given if delivered personally, sent via facsimile, with
confirmation, mailed by registered or certified mail, return receipt requested, or delivered by an
express courier, with confirmation, to the parties at the following addresses or at such other
address for a party as shall be specified by like notice:




     (a) if to Omega, to:


Omega Financial Corporation

366 Walker Drive

State College, PA 16801

Attention: Donita R. Koval

Facsimile:



with a copy to:



Blank Rome LLP

One Logan Square

Philadelphia, PA 19006

Attention: Lawrence R. Wiseman, Esq.

Facsimile: (215) 832-5549




          (b) if to FNB, to:



F.N.B. Corporation

One F.N.B. Boulevard

Hermitage, PA 16148



Attention:
Stephen J. Gurgovits

Facsimile (724) 983-3515



with a copy to:



Duane Morris LLP

30 South 17th Street

Philadelphia, PA 19103

Attention: Frederick W. Dreher, Esq.

Facsimile: (215) 979-1213




     9.5 Interpretation. When a reference is made in this Agreement to Articles, Sections,
Exhibits or Schedules, such reference shall be to an Article or Section of or Exhibit or Schedule
to this Agreement unless otherwise indicated. The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way



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the meaning or interpretation of this Agreement. Whenever the words “include,” “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by the words “without
limitation.” The Omega Disclosure Schedule and the FNB Disclosure Schedule, as well as all other
schedules and all exhibits hereto, shall be deemed part of this Agreement and included in any
reference to this Agreement. This Agreement shall not be interpreted or construed to require any
person to take any action, or fail to take any action, if to do so would violate any applicable
law.




     9.6 Counterparts. This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and shall become effective when counterparts
have been signed by each of the parties and delivered to the other party, it being understood that
each party need not sign the same counterpart.



     9.7 Entire Agreement. This Agreement, including the documents and the instruments
referred to in this Agreement, together with the Confidentiality Agreement, constitutes the entire
agreement and supersedes all prior agreements and understandings, both written and oral, between
the parties with respect to the subject matter of this Agreement, other than the Confidentiality
Agreement.



     9.8 Governing Law; Jurisdiction.



          (a) This Agreement, the Merger and all claims arising hereunder or relating hereto, shall be
governed and construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania, without giving effect to the principles of conflicts of law thereof.




          (b) Each of the parties hereto irrevocably and unconditionally submits, for itself and its
property, to the exclusive jurisdiction of any Pennsylvania state court or the United States
District Court for the Eastern District of Pennsylvania, in any action or proceeding arising out of
or relating to this Agreement. Each of the parties hereto agrees that, subject to rights with
respect to post-trial motions and rights of appeal or other avenues of review, a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Each of the parties hereto
irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so,
any objection that it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any Pennsylvania state court or the
United States District Court for the Eastern District of Pennsylvania. Each of the parties hereto
irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so,
the defense of an inconvenient forum to the maintenance of such action or proceeding in any such
court.




          (c) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO



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INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY
WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY
UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH PARTY MAKES THIS WAIVER
VOLUNTARILY AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.8.




     9.9 Severability. Except to the extent that application of this Section 9.9 would
have a Material Adverse Effect on Omega or FNB, any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the
extent of such invalidity or unenforceability without rendering invalid or unenforceable the
remaining terms and provisions of this Agreement or affecting the validity or enforceability of any
of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so
broad as is enforceable. In all such cases, the parties shall use their reasonable best efforts to
substitute a valid, legal and enforceable provision that, insofar as practicable, implements the
original purposes and intents of this Agreement.



     9.10 Assignment; Third Party Beneficiaries. Neither this Agreement nor any of the
rights, interests or obligations under this Agreement shall be assigned by either of the parties
(whether by operation of law or otherwise) without the prior written consent of the other party.
Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of
and be enforceable by each of the parties and their respective successors and assigns. Except as
otherwise specifically provided in Section 6.8 and 6.15, this Agreement (including the documents
and instruments referred to in this Agreement) is not intended to and does not confer upon any
person other than the parties hereto any rights or remedies under this Agreement.



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     IN WITNESS WHEREOF, the duly authorized officers of F.N.B. Corporation and Omega Financial
Corporation have executed this Agreement as of the date first above written.



	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	F.N.B. CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen J. Gurgovits	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Stephen J. Gurgovits,	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	OMEGA FINANCIAL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Donita R. Koval	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Donita R. Koval,	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 







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