EXHIBIT 2.1

                                 TERMINATION AGREEMENT


          TERMINATION AGREEMENT (this "Agreement"), dated July 24, 1996 by and
among Danielson Holding Corporation, a Delaware corporation (the "Purchaser"),
Midland Financial Group, Inc., a Tennessee corporation (the "Company"), and
Mission Sub E, Inc., a Delaware corporation (the "Merger Sub").

                              W I T N E S S E T H
                              - - - - - - - - - -
          WHEREAS, the Purchaser, the Company and the Merger Sub have entered
into an Agreement and Plan of Merger dated as of February 26, 1996, as amended
(the "Merger Agreement");
          WHEREAS, the Purchaser, the Company and the Merger Sub desire to
terminate the Merger Agreement and to take certain actions in connection
therewith;
          NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows: 

          1. Pursuant to Section 8.1 of the Merger Agreement, the Purchaser, the
Company and the Merger Sub mutually agree to terminate the Merger Agreement
effective immediately.

          2.  The Purchaser and the Merger Sub hereby forever and irrevocably
release and discharge the Company, and the Company hereby forever and
irrevocably releases and discharges the Purchaser and the Merger Sub, from any
and all obligations, liabilities, covenants, agreements, claims and causes of
action that each has or may have arising out of, in connection with, or relating
in any way to the Merger Agreement and all related documents executed and
delivered in connection with the transactions contemplated thereby.

                                                              Page 7 of 11 pages

 
          IN WITNESS WHEREOF, each party hereto has caused this Termination
Agreement to be duly executed by its duly authorized officer on the date first
set forth above.


                                 DANIELSON HOLDING CORPORATION



                                 By: /s/ Martin J. Whitman
                                     ------------------------------
                                      Martin J. Whitman
                                      Chairman of the Board


                                 MISSION SUB E, INC.



                                 By: /s/ Martin J. Whitman
                                     ------------------------------
                                      Martin J. Whitman
                                      President


                                 MIDLAND FINANCIAL GROUP, INC.



                                 By: /s/ Joseph W. McLeary
                                     -------------------------------
                                      Joseph W. McLeary
                                      Chairman and Chief
                                      Executive Officer

                                                              Page 8 of 11 pages