1
As filed with the Securities and Exchange Commission on May 28, 1996.
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-4
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933

WINTRUST FINANCIAL CORPORATION
(Exact Name of Registrant as Specified in Its Charter)

6712
(Primary Standard Industrial Classification Code Number)

ILLINOIS 36-3873352
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)

727 NORTH BANK LANE, LAKE FOREST, ILLINOIS 60045-1951, (847) 234-2882
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)

EDWARD J. WEHMER
727 NORTH BANK LANE, LAKE FOREST, ILLINOIS 60045-1951
(847) 234-2882
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

Copy To:

JENNIFER R. EVANS, ESQ.
VEDDER, PRICE, KAUFMAN & KAMMHOLZ
222 NORTH LASALLE STREET
CHICAGO, ILLINOIS 60601
(312) 609-7500

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: Upon
consummation of the Reorganization as described in the Registration Statement.

If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]

CALCULATION OF REGISTRATION FEE

====================================================================================================================
PROPOSED
AMOUNT PROPOSED MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SHARE* OFFERING PRICE* FEE
- --------------------------------------------------------------------------------------------------------------------

Common Stock, without par 5,238,414 $5.96 $31,217,050 $10,765
value shares
====================================================================================================================

* Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(f)(2) based upon the average weighted book values of
the common stock to be exchanged of Lake Forest Bancorp, Inc., Hinsdale
Bancorp, Inc., Libertyville Bancorp, Inc., and Crabtree Capital Corporation
as of March 31, 1996.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
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WINTRUST FINANCIAL CORPORATION
CROSS REFERENCE SHEET

Item Number Location in Prospectus
----------- ----------------------

A. INFORMATION ABOUT THE TRANSACTION

1. Forepart of Registration Statement and Cover Page
Outside Front Cover of Prospectus

2. Inside Front and Outside Back Cover Pages Inside Cover Page, Outside Back Cover Page
of Prospectus

3. Risk Factors, Ratio of Earnings to Fixed RISK FACTORS AND CERTAIN OTHER CONSIDERATIONS
Charges and Other Information

4. Terms of the Transaction SUMMARY;
BACKGROUND OF THE REORGANIZATION; TERMS OF THE
REORGANIZATION
5. Pro Forma Financial Information PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

6. Material Contacts with the Company Being TERMS OF THE REORGANIZATION --
Acquired

7. Additional Information Required for Not Applicable
Reoffering by Persons and Parties Deemed to
be Underwriters

8. Interests of Named Experts and Counsel Not Applicable

9. Disclosure of Commission Position on Not Applicable
Indemnification for Securities Act
Liabilities

B. INFORMATION ABOUT THE REGISTRANT

10. Information with respect to S-3 Registrants Not Applicable

11. Incorporation of Certain Information by Not Applicable
Reference

12. Information with respect to S-2 or S-3 Not Applicable
Registrants

13. Incorporation of Certain Information by Not Applicable
Reference

14. Information with respect to Registrants SUMMARY; RISK FACTORS AND CERTAIN OTHER
other than S-2 or S-3 Registrants CONSIDERATIONS; WINTRUST FINANCIAL CORPORATION;
NORTH SHORE COMMUNITY BANCORP, INC.; MATTERS OF
GENERAL APPLICABILITY TO THE BANKS; DESCRIPTION OF
CAPITAL STOCK OF WINTRUST; COMPARATIVE RIGHTS OF
SHAREHOLDERS OF WINTRUST AND THE COMPANIES;
AVAILABLE INFORMATION; INDEX TO FINANCIAL STATEMENTS

C. INFORMATION ABOUT THE COMPANY BEING ACQUIRED

15. Information with respect to S-3 Companies Not Applicable

16. Information with respect to S-2 or S-3 Not Applicable
Companies

17. Information with respect to Companies other LAKE FOREST BANCORP, INC.; HINSDALE BANCORP, INC.;
than S-2 or S-3 Companies LIBERTYVILLE BANCORP, INC.; MATTERS OF GENERAL
APPLICABILITY TO THE BANKS; CRABTREE CAPITAL
CORPORATION; INDEX TO FINANCIAL STATEMENTS

D. VOTING AND MANAGEMENT INFORMATION
18. Information if proxies, consents or MEETING INFORMATION; SUMMARY; WINTRUST FINANCIAL
authorizations are to be solicited CORPORATION

19. Information if proxies, consents or Not Applicable
authorizations are not to be solicited in
an exchange offer

NORTH SHORE COMMUNITY BANCORP, INC.
1145 WILMETTE AVENUE
WILMETTE, ILLINOIS 60091

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JULY ___, 1996

A Special Meeting of Shareholders (the "Special Meeting") of North
Shore Community Bancorp, Inc., an Illinois corporation ("North Shore"), will be
held on July ____, 1996 at ____ m., Chicago time, at
_____________________________. The purpose of the Special Meeting is to
consider and vote to approve and adopt the proposed Agreement and Plan of
Reorganization, dated as of May 28, 1996 (the "Reorganization Agreement"), by
and among North Shore, Lake Forest Bancorp, Inc., a Delaware corporation ("Lake
Forest"), Hinsdale Bancorp, Inc., an Illinois corporation ("Hinsdale"),
Libertyville Bancorp, Inc., an Illinois corporation ("Libertyville"), and
Crabtree Capital Corporation, a Delaware corporation ("Crabtree"), pursuant to
which the newly-formed merger subsidiaries of North Shore will merge with and
into Lake Forest, Hinsdale, Libertyville and Crabtree, and the shareholders of
each of the companies will be entitled to receive shares of North Shore on
basis of certain fixed exchange ratios, upon the terms and subject to the
conditions set forth in the Reorganization Agreement, all as more fully
described in the enclosed Joint Proxy Statement/Prospectus. As a result of the
Reorganization, North Shore will be renamed Wintrust Financial Corporation,
with amended and restated articles and by-laws, which will be the combined
holding company for each of the respective businesses. A copy of the
Reorganization Agreement is attached as Appendix A to the accompanying Joint
Proxy Statement/Prospectus.

The Board of Directors has fixed the close of business on
_______________, 1996 as the record date (the "Record Date") for determining
shareholders entitled to notice of, and to vote at, the Special Meeting and any
adjournments or postponements thereof. The holders of record of North Shore
Common Stock at the Record Date are entitled to notice of and to vote at the
Special Meeting and any adjournments or postponements thereof.

THE BOARD OF DIRECTORS HAS APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL AND ADOPTION OF
THE REORGANIZATION AGREEMENT.

By Order of the Board of Directors,

Wilmette, Illinois ________________________________________
__________, 1996 Secretary

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING IN PERSON, YOU
ARE REQUESTED TO COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN THE
ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF
YOU ATTEND THE SPECIAL MEETING, YOU MAY VOTE IN PERSON IF YOU WISH, EVEN IF YOU
HAVE PREVIOUSLY RETURNED YOUR PROXY CARD.
5

LAKE FOREST BANCORP, INC.
727 NORTH BANK LANE
LAKE FOREST, ILLINOIS 60045-1951

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JULY ___, 1996

A Special Meeting of Shareholders (the "Special Meeting") of Lake
Forest Bancorp, Inc., a Delaware corporation ("Lake Forest"), will be held on
July ____, 1996 at ____ m., Chicago time, at _____________________________.
The purpose of the Special Meeting is to consider and vote to approve and adopt
the proposed Agreement and Plan of Reorganization, dated as of May 28, 1996
(the "Reorganization Agreement"), by and among North Shore Community Bancorp,
Inc., an Illinois corporation ("North Shore"), Lake Forest, Hinsdale Bancorp,
Inc., an Illinois corporation ("Hinsdale"), Libertyville Bancorp, Inc., an
Illinois corporation ("Libertyville"), and Crabtree Capital Corporation, a
Delaware corporation ("Crabtree"), pursuant to which the newly-formed merger
subsidiaries of North Shore will merge with and into Lake Forest, Hinsdale,
Libertyville and Crabtree, and the shareholders of each of the companies will
be entitled to receive shares of North Shore on basis of certain fixed exchange
ratios, upon the terms and subject to the conditions set forth in the
Reorganization Agreement, all as more fully described in the enclosed Joint
Proxy Statement/Prospectus. As a result of the Reorganization, North Shore
will be renamed Wintrust Financial Corporation, with amended and restated
articles and by-laws, which will be the combined holding company for each of
the respective businesses. A copy of the Reorganization Agreement is attached
as Appendix A to the accompanying Joint Proxy Statement/Prospectus.

The Board of Directors has fixed the close of business on
_______________, 1996 as the record date (the "Record Date") for determining
shareholders entitled to notice of, and to vote at, the Special Meeting and any
adjournments or postponements thereof. The holders of record of Lake Forest
Common Stock at the Record Date are entitled to notice of and to vote at the
Special Meeting and any adjournments or postponements thereof.

THE BOARD OF DIRECTORS HAS APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL AND ADOPTION OF
THE REORGANIZATION AGREEMENT.

By Order of the Board of Directors,

Lake Forest, Illinois ________________________________________
__________, 1996 Secretary

HINSDALE BANCORP, INC.
25 EAST FIRST STREET
HINSDALE, ILLINOIS 60521-4115

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JULY ___, 1996

A Special Meeting of Shareholders (the "Special Meeting") of Hinsdale
Bancorp, Inc., an Illinois corporation ("Hinsdale"), will be held on July ____,
1996 at ____ m., Chicago time, at _____________________________. The purpose
of the Special Meeting is to consider and vote to approve and adopt the
proposed Agreement and Plan of Reorganization, dated as of May 28, 1996 (the
"Reorganization Agreement"), by and among North Shore Community Bancorp, Inc.,
an Illinois corporation ("North Shore"), Lake Forest Bancorp, Inc., a Delaware
corporation ("Lake Forest"), Hinsdale, Libertyville Bancorp, Inc., an Illinois
corporation ("Libertyville"), and Crabtree Capital Corporation, a Delaware
corporation ("Crabtree"), pursuant to which the newly-formed merger
subsidiaries of North Shore will merge with and into Lake Forest, Hinsdale,
Libertyville and Crabtree, and the shareholders of each of the companies will
be entitled to receive shares of North Shore on basis of certain fixed exchange
ratios, upon the terms and subject to the conditions set forth in the
Reorganization Agreement, all as more fully described in the enclosed Joint
Proxy Statement/Prospectus. As a result of the Reorganization, North Shore
will be renamed Wintrust Financial Corporation, with amended and restated
articles and by-laws, which will be the combined holding company for each of
the respective businesses. A copy of the Reorganization Agreement is attached
as Appendix A to the accompanying Joint Proxy Statement/Prospectus.

The Board of Directors has fixed the close of business on
_______________, 1996 as the record date (the "Record Date") for determining
shareholders entitled to notice of, and to vote at, the Special Meeting and any
adjournments or postponements thereof. The holders of record of Hinsdale
Common Stock at the Record Date are entitled to notice of and to vote at the
Special Meeting and any adjournments or postponements thereof.

THE BOARD OF DIRECTORS HAS APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL AND ADOPTION OF
THE REORGANIZATION AGREEMENT.

By Order of the Board of Directors,

Hinsdale, Illinois ________________________________________
__________, 1996 Secretary

LIBERTYVILLE BANCORP, INC.
507 NORTH MILWAUKEE AVENUE
LIBERTYVILLE, ILLINOIS 60048

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JULY ___, 1996

A Special Meeting of Shareholders (the "Special Meeting") of
Libertyville Bancorp, Inc., an Illinois corporation ("Libertyville"), will be
held on July ____, 1996 at ____ m., Chicago time, at
_____________________________. The purpose of the Special Meeting is to
consider and vote to approve and adopt the proposed Agreement and Plan of
Reorganization, dated as of May 28, 1996 (the "Reorganization Agreement"), by
and among North Shore Community Bancorp, Inc., an Illinois corporation ("North
Shore"), Lake Forest Bancorp, Inc., a Delaware corporation ("Lake Forest"),
Hinsdale Bancorp, Inc., an Illinois corporation ("Hinsdale"), Libertyville and
Crabtree Capital Corporation, a Delaware corporation ("Crabtree"), pursuant to
which the newly-formed merger subsidiaries of North Shore will merge with and
into Lake Forest, Hinsdale, Libertyville and Crabtree, and the shareholders of
each of the companies will be entitled to receive shares of North Shore on
basis of certain fixed exchange ratios, upon the terms and subject to the
conditions set forth in the Reorganization Agreement, all as more fully
described in the enclosed Joint Proxy Statement/Prospectus. As a result of the
Reorganization, North Shore will be renamed Wintrust Financial Corporation,
with amended and restated articles and by-laws, which will be the combined
holding company for each of the respective businesses. A copy of the
Reorganization Agreement is attached as Appendix A to the accompanying Joint
Proxy Statement/Prospectus.

The Board of Directors has fixed the close of business on
_______________, 1996 as the record date (the "Record Date") for determining
shareholders entitled to notice of, and to vote at, the Special Meeting and any
adjournments or postponements thereof. The holders of record of Libertyville
Common Stock at the Record Date are entitled to notice of and to vote at the
Special Meeting and any adjournments or postponements thereof.

THE BOARD OF DIRECTORS HAS APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL AND ADOPTION OF
THE REORGANIZATION AGREEMENT.

By Order of the Board of Directors,

Libertyville, Illinois ________________________________________
__________, 1996 Secretary

CRABTREE CAPITAL CORPORATION
475 NORTH MARTINGALE ROAD
SUITE 440
SCHAUMBURG, ILLINOIS 60173

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JULY ___, 1996

A Special Meeting of Shareholders (the "Special Meeting") of Crabtree
Capital Corporation, a Delaware corporation ("Crabtree"), will be held on July
____, 1996 at ____ m., Chicago time, at _____________________________. The
purpose of the Special Meeting is to consider and vote to approve and adopt the
proposed Agreement and Plan of Reorganization, dated as of May 28, 1996 (the
"Reorganization Agreement"), by and among North Shore Community Bancorp, Inc.,
an Illinois corporation ("North Shore"), Lake Forest Bancorp, Inc., a Delaware
corporation ("Lake Forest"), Hinsdale Bancorp, Inc., an Illinois corporation
("Hinsdale"), Libertyville Bancorp, Inc., an Illinois corporation
("Libertyville") and Crabtree, pursuant to which the newly-formed merger
subsidiaries of North Shore will merge with and into Lake Forest, Hinsdale,
Libertyville and Crabtree, and the shareholders of each of the companies will
be entitled to receive shares of North Shore on basis of certain fixed exchange
ratios, upon the terms and subject to the conditions set forth in the
Reorganization Agreement, all as more fully described in the enclosed Joint
Proxy Statement/Prospectus. As a result of the Reorganization, North Shore
will be renamed Wintrust Financial Corporation, with amended and restated
articles and by-laws, which will be the combined holding company for each of
the respective businesses. A copy of the Reorganization Agreement is attached
as Appendix A to the accompanying Joint Proxy Statement/Prospectus.

The Board of Directors has fixed the close of business on
_______________, 1996 as the record date (the "Record Date") for determining
shareholders entitled to notice of, and to vote at, the Special Meeting and any
adjournments or postponements thereof. The holders of record of Crabtree
Common Stock at the Record Date are entitled to notice of and to vote at the
Special Meeting and any adjournments or postponements thereof.

THE BOARD OF DIRECTORS HAS APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" APPROVAL AND ADOPTION OF
THE REORGANIZATION AGREEMENT.

By Order of the Board of Directors,

Schaumburg, Illinois ________________________________________
__________, 1996 Secretary

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO THE
REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED __________, 1996
JOINT PROXY STATEMENT
SPECIAL MEETING OF SHAREHOLDERS OF EACH OF
NORTH SHORE COMMUNITY BANCORP, INC.
LAKE FOREST BANCORP, INC.
HINSDALE BANCORP, INC.
LIBERTYVILLE BANCORP, INC.
CRABTREE CAPITAL CORPORATION
__________

PROSPECTUS
WINTRUST FINANCIAL CORPORATION

This Joint Proxy Statement/Prospectus is provided in connection with
the solicitation of proxies by the Board of Directors of North Shore Community
Bancorp, Inc., an Illinois corporation ("North Shore"), Lake Forest Bancorp,
Inc. a Delaware corporation ("Lake Forest"), Hinsdale Bancorp, Inc., an
Illinois corporation ("Hinsdale"), Libertyville Bancorp, Inc., an Illinois
corporation ("Libertyville") and Crabtree Capital Corporation, a Delaware
corporation ("Crabtree"), to be voted at the Special Meeting of Shareholders of
North Shore, Lake Forest, Hinsdale, Libertyville and Crabtree, respectively
(each a "Special Meeting" and collectively, the "Special Meetings"), to be held
on July ___, 1996, July ___, 1996, July ___, 1996, July ___, 1996, and July
___, 1996, respectively, and at any adjournment thereof, for the purpose of
considering and voting upon a proposal to approve the Agreement and Plan of
Reorganization, dated as of May 28, 1996 (the "Reorganization Agreement"), by
and among North Shore, Lake Forest, Hinsdale, Libertyville and Crabtree and
certain newly-formed merger subsidiaries of North Shore -- Lake Forest Bancorp
II, an Illinois corporation ("LFBII"), Hinsdale Bancorp II, an Illinois
corporation ("HBII"), Libertyville Bancorp II, an Illinois corporation
("LBII"), and Crabtree Capital Corporation II, an Illinois corporation
("Crabtree II") (each a "Constituent Corporation" and collectively, the
"Constituent Corporations"). Pursuant to the Reorganization Agreement, LFBII
will merge with and into Lake Forest, HBII will merge with and into Hinsdale,
LBII will merge with and into Libertyville and Crabtree II will merge with and
into Crabtree (the "Reorganization"), and North Shore will be renamed Wintrust
Financial Corporation ("Wintrust"), with amended and restated articles and
bylaws. After the Reorganization, Wintrust will be the combined holding
company for each of the respective businesses. The Reorganization Agreement is
attached to this Joint Proxy Statement/Prospectus as Appendix A.

This Joint Proxy Statement/Prospectus is also a prospectus of Wintrust
relating to its offering of shares of Wintrust Common Stock to be issued to the
holders of Common Stock of Lake Forest, Hinsdale, Libertyville and Crabtree in
connection with the proposed Reorganization. If the Reorganization Agreement
is approved by the requisite vote of the shareholders of the Constituent
Corporations, following satisfaction of certain other conditions, upon
consummation of the Reorganization each issued and outstanding share of Lake
Forest, other than dissenting shares, will be converted into and exchanged for
9.67334 shares of Wintrust, each issued and outstanding share of Hinsdale,
other than dissenting shares, will be converted into and exchanged for 6.03398
shares of Wintrust, each issued and outstanding share of Libertyville, other
than dissenting shares, will be converted into and exchanged for 4.02578 shares
of Wintrust, and each issued and outstanding share of Crabtree, other than
dissenting shares, will be converted into and exchanged for 1.18332 shares of
Wintrust; provided that any such shares held by one of the other constituent
corporations shall be cancelled. Immediately before, and contingent upon
consummation of the Reorganization, each issued and outstanding share of North
Shore will be adjusted pursuant to a stock split (the "North Shore Stock
Split") to represent 5.16180 shares of Wintrust. See "TERMS OF THE
REORGANIZATION."

Consummation of the Reorganization is subject to the approval of the
shareholders of each of North Shore, Lake Forest, Hinsdale, Libertyville and
Crabtree, the receipt of all required regulatory approvals and certain other
conditions. See "Conditions of Consummation" and "Statutory Authority Required
for Approvals" under "TERMS OF THE REORGANIZATION."

INVESTORS SHOULD CAREFULLY CONSIDER THE FACTORS SET FORTH UNDER "RISK
FACTORS AND CERTAIN CONSIDERATIONS."

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THE DATE OF THIS JOINT PROXY STATEMENT/PROSPECTUS IS JULY ___, 1996

TABLE OF CONTENTS

MEETING INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Purpose of the Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Shares Entitled to Vote; Votes Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Solicitation, Voting and Revocation of Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Reasons for the Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Recommendations of the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Opinions of Howe Barnes Investments, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Exchange of Stock Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Certain Material Federal Income Tax Consequences of the Reorganization . . . . . . . . . . . . . . . . . . 5
Regulatory Approvals and Other Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Waiver, Amendment and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Dissenters' Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Resales of Wintrust Common Stock by Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Market Prices of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Comparative Per Share Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

RISK FACTORS AND CERTAIN OTHER CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Potential Conflicts of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Reliance on Key Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Additional Capital Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Limited Market for Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Certain Anti-Takeover Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Impact of De Novo Operations on Wintrust Profitability . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Allowance for Loan Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Effect of Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Regulatory Restrictions on Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Financial Institution Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

BACKGROUND OF THE REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Background of the Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Reasons for the Reorganization and Recommendations of the Board of Directors . . . . . . . . . . . . . . . 13
Opinions of Howe Barnes Investments, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

TERMS OF THE REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Exchange Ratios . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Common Stock Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Options/Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Closing Date of the Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Surrender of Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Conditions to the Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Regulatory Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Conduct of Business Pending the Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

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Certain Material Federal Income Tax Consequences of the Reorganization . . . . . . . . . . . . . . . . . . 24
Accounting Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Termination, Amendment and Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Interests of Certain Persons in the Reorganization; Conflicts of Interest . . . . . . . . . . . . . . . . 27
Material Arrangements Between the Companies; Certain Transactions with Management . . . . . . . . . . . . 28
Dissenters' Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Resale of Wintrust Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

DESCRIPTION OF CAPITAL STOCK OF WINTRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Certain Anti-Takeover Effects of Wintrust's Articles and By-Laws and Illinois Law . . . . . . . . . . . . 34

COMPARATIVE RIGHTS OF SHAREHOLDERS OF WINTRUST AND THE COMPANIES . . . . . . . . . . . . . . . . . . . . . . . . . 37
Authorized Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Size and Classification of the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Nominations for Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Action by Written Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Meetings of Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Shareholder Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Indemnification of Officers and Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Limitation on Directors' Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Shareholder Vote Required to Approve Business Combinations with Principal Shareholders . . . . . . . . . . 40
Amendment of the Articles and By-Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

WINTRUST FINANCIAL CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Operational Philosophy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Management of Wintrust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Proposed Public Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Possible Acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Dividend Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Reports to Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Pro Forma Condensed Combined Statement of Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Pro Forma Condensed Combined Statement of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Notes to Pro Forma Condensed Combined Financial Information . . . . . . . . . . . . . . . . . . . . . . . 61

NORTH SHORE COMMUNITY BANCORP, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Management Ownership of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Beneficial Ownership of Certain Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . 66

LAKE FOREST BANCORP, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

Management Ownership of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Beneficial Ownership of Certain Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . 84

HINSDALE BANCORP, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Management Ownership of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Beneficial Ownership of Certain Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . 106

LIBERTYVILLE BANCORP, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124
Management Ownership of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
Beneficial Ownership of Certain Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . 127

MATTERS OF GENERAL APPLICABILITY TO BANKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140
Supervision and Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140

CRABTREE CAPITAL CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
Management Ownership of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151

Beneficial Ownership of Certain Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 152
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
Management's Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . 154

LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
OTHER MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162
INDEX TO FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163
APPENDIX A - AGREEMENT AND PLAN OF REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
APPENDIX B - FAIRNESS OPINIONS OF HOWE BARNES INVESTMENTS, INC. . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
APPENDIX C - SECTIONS 11.65 AND 11.70 OF THE ILLINOIS BUSINESS CORPORATION ACT . . . . . . . . . . . . . . . . . . C-1
APPENDIX D - SECTION 262 OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE . . . . . . . . . . . . . . . . . D-1

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MEETING INFORMATION

GENERAL

This Prospectus and Joint Proxy Statement is being furnished to the
shareholders of each of North Shore, Lake Forest, Hinsdale, Libertyville and
Crabtree (each a "Company" and collectively, the "Companies") in connection
with the solicitation of proxies by the Board of Directors of each of the
Companies for use at its Special Meeting of Shareholders scheduled to be held
on July ___, 1996, July ___, 1996, July ___, 1996, July ___, 1996 and July ___,
1996, respectively, at the applicable time and place specified in the
accompanying Notice of Special Meeting of Shareholders, or any adjournments or
postponements thereof.

Each of the Companies is deemed to have itself supplied all
information contained herein with respect to itself.

This Joint Proxy Statement/Prospectus was mailed to the shareholders
of the Companies on approximately July ___, 1996.

PURPOSE OF THE MEETINGS

The purpose of each of the Special Meetings is to consider and vote
upon a proposal to approve the Reorganization Agreement providing for Lake
Forest, Hinsdale, Libertyville and Crabtree to each merge with a separate
merger subsidiary of North Shore, the name of which will be thereupon be
changed to Wintrust Financial Corporation, such that Wintrust will become the
parent holding company of the businesses of each of the Companies which will
continue to be separately operated in subsidiaries of Wintrust. Pursuant to
the terms of the Reorganization Agreement, among other things, (i) LFBII will
merge with and into Lake Forest, HBII will merge with and into Hinsdale, LBII
will merge with and into Libertyville, and Crabtree II will merge with and into
Crabtree, with Lake Forest, Hinsdale, Libertyville and Crabtree as the
surviving entities; (ii) each issued and outstanding share of Common Stock of
Lake Forest, Hinsdale, Libertyville and Crabtree, other than dissenting shares,
will be converted into the right to receive 9.67334, 6.03398, 4.02578 and
1.18332 shares of Wintrust Common Stock, respectively; and (iii) each issued
and outstanding share of North Shore Common Stock, other than dissenting
shares, shall be adjusted pursuant to the North Shore Stock Split to represent
5.16180 shares of Wintrust Common Stock.

SHARES ENTITLED TO VOTE; VOTES REQUIRED

Only holders of record of the common stock of the Companies at the
close of business on __________, 1996 (the "Record Date") are entitled to
notice of and to vote at the Special Meetings. On the Record Date, the number
of outstanding shares of North Shore Common Stock was [253,809], the number of
outstanding shares of Lake Forest Common Stock was [163,360], the number of
outstanding shares of Hinsdale Common Stock was [207,137], the number of
outstanding shares of Libertyville Common Stock was [229,929], and the number
of outstanding shares of Crabtree Common Stock was [1,025,265]. Each share of
the common stock of each of the Companies (collectively, the "Company Common
Stock") is entitled to one vote on each matter to come before the Special
Meeting of the respective Company. As Illinois corporations, the Articles of
Incorporation of each of North Shore, Hinsdale and Libertyville require that
the Reorganization Agreement be approved by the affirmative vote of
shareholders owning at least 2/3 of the issued and outstanding shares of
Common Stock entitled to vote at such Company's Special Meeting. As Delaware
corporations, the Certificate of Incorporation of each of Lake Forest and
Crabtree require that the Reorganization Agreement be approved by the
affirmative vote of shareholders owning at least a majority of the issued and
outstanding shares of common stock entitled to vote at such Company's Special
Meeting.

Each Company has been advised by its directors, executive officers and
certain other significant shareholders, as well as by directors and executive
officers of the other Companies who are shareholders of that
14

Company, who together vote the aggregate number of shares of the Common Stock
of the Companies set forth in the table below, that they intend to vote for
approval of the Reorganization Agreement:

Number of Shares
Held By Directors,
Executive Officers and Other Percent of
Company Significant Shareholders(1)(2) Outstanding Shares(2)
------- ------------------------------- ---------------------

North Shore . . . . . . . . . 91,767 36.16%
Lake Forest . . . . . . . . . 70,869 43.38%
Hinsdale . . . . . . . . . . 73,034 35.26%
Libertyville . . . . . . . . 92,809 40.36%
Crabtree . . . . . . . . . . 337,467 32.92%

____________________________________________________________________________
(1) Includes for each Company the aggregate number of shares of that Company
held with the power to vote by those persons who are directors, executive
officers or significant shareholders of any of the Companies, provided such
persons have indicated their intention to vote such shares in favor of the
Reorganization at the respective shareholder meetings.

(2) Assumes no exercise of options, rights and warrants prior to the
Reorganization and therefore does not reflect beneficial ownership of
shares subject thereto. Does reflect conversion to Common Stock of shares
of preferred stock outstanding at Lake Forest and Libertyville, as required
by the Reorganization Agreement.

SOLICITATION, VOTING AND REVOCATION OF PROXIES

In addition to soliciting proxies by mail, directors, officers and
employees of the Companies, without receiving additional compensation therefor,
may solicit proxies by telephone, by telegram or facsimile, and in person.
Arrangements may also be made with custodians, nominees and fiduciaries who do
not exercise voting discretion to forward solicitation materials to the
beneficial owners of shares of the Common Stock of the Companies, and each of
the Companies will reimburse such parties for reasonable out-of-pocket expenses
incurred in connection therewith. Because approval of the Reorganization
requires the applicable majority vote of each Company's total shares
outstanding, any shares represented by proxies which are not properly signed
and received by the respective Company prior to the Special Meeting will not be
voted and will thus have the same effect as a vote against the proposal.

Proxies will be voted as specified. However, if no contrary
specification is made in a proxy, it will be voted "FOR" approval of the
Reorganization Agreement. A proxy may be revoked by (i) giving written notice
of revocation at any time before its exercise to the Secretary of the relevant
Company, c/o Mr. David A. Dykstra, 727 North Bank Lane, Lake Forest, Illinois
60045-1951, or (ii) executing and delivering to the appropriate Company at any
time before the proxy's exercise a later dated proxy, or (iii) attending the
Special Meeting of the appropriate Company and voting in person.

The Boards of Directors of the Companies are not aware of any business
to be acted upon at the Special Meetings other than consideration of the
proposal to approve the Reorganization. If, however, other proper matters are
brought before the Special Meetings, or any adjournments or postponements
thereof, the persons appointed as proxies will have discretion to vote or
abstain from voting thereon according to their best judgment.

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING IN PERSON, EACH
HOLDER OF SHARES OF ANY OF THE COMPANIES IS URGED TO COMPLETE, DATE AND SIGN
THE ACCOMPANYING PROXY AND RETURN IT PROMPTLY TO THE RELEVANT COMPANY IN THE
ENCLOSED POSTAGE-PREPAID ENVELOPE.

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SUMMARY

The following is a summary, which is not intended to be complete, of
certain information contained elsewhere in this Joint Proxy
Statement/Prospectus. Reference is made to, and this summary is qualified in
its entirety by, the more detailed information contained herein and the
exhibits hereto. Each shareholder is urged to carefully read this Joint Proxy
Statement/Prospectus and the appendices hereto in their entirety.

THE COMPANIES

Each of the Companies that is party to the proposed Reorganization,
except Crabtree, is a one-bank holding company providing community- based
banking services in different affluent suburbs of Chicago, Illinois. Crabtree
is the holding company for First Premium Services, Inc., an Illinois
corporation whose primary business is the financing of insurance premiums
("First Premium"). Howard D. Adams is a founding shareholder and serves as
Chairman or Vice Chairman of each of the Companies. The Companies share, to
varying degrees, common ownership, common senior management and/or business
relationships with each of the other Companies.

Each of North Shore, Lake Forest, Hinsdale and Libertyville is engaged
in commercial banking through its bank subsidiary: North Shore Community Bank
and Trust Company, an Illinois banking corporation ("North Shore Bank"), Lake
Forest Bank and Trust Company, an Illinois banking corporation ("Lake Forest
Bank"), Hinsdale Bank and Trust Company, an Illinois banking corporation
("Hinsdale Bank"), and Libertyville Bank and Trust Company, an Illinois banking
corporation ("Libertyville Bank"), respectively (collectively, the "Banks").
Lake Forest was incorporated in Delaware in 1991. Hinsdale, North Shore and
Libertyville were incorporated in Illinois in 1992, 1992 and 1994,
respectively.

Each of the Banks provides a variety of financial services to
individuals, businesses, local governmental units and institutional customers.
These services include personal and commercial banking services, including
demand, NOW, money market, savings, and time deposit accounts; real estate,
commercial, and consumer loans; safe deposit facilities; and other services
tailored for its customer base. Lake Forest Bank, Hinsdale Bank, North Shore
Bank and Libertyville Bank each were organized and began operations as Illinois
state chartered banks in December 1991, October 1993, September 1994, and
October 1995, respectively.

The address of North Shore's principal executive office is 1145
Wilmette Avenue, Wilmette, Illinois 60091; and its telephone number is (847)
853-1145. As of March 31, 1996, North Shore had total assets of $117,938,000
and total shareholders' equity of $11,407,000. See "Business" and "Selected
Financial Data" under "NORTH SHORE COMMUNITY BANCORP, INC."

The address of Lake Forest's principal executive office is 727 North
Bank Lane, Lake Forest, Illinois 60045; and its telephone number is (847)
234-2882. As of March 31, 1996, Lake Forest had total assets of $216,350,000
and total shareholders' equity of $11,095,000. See "Business" and "Selected
Financial Data" under "LAKE FOREST BANCORP, INC."

Hinsdale Bank began operations as a bank in October of 1993. The
address of Hinsdale's principal executive office is 25 East First Street,
Hinsdale, Illinois 60521 and its telephone number is (708) 323-4404. As of
March 31, 1996, Hinsdale had total assets of $118,545,000 and total
shareholders' equity of $9,776,000. See "Business" and "Selected Financial
Data" under "HINSDALE BANCORP, INC."

The address of Libertyville's principal executive office is 507 North
Milwaukee Avenue, Libertyville, Illinois 60048 and its telephone number is
(847) 367-6800. As of March 31, 1996, Libertyville had total assets of
$52,542,000 and total shareholders' equity of $9,387,000. See "Business" and
"Selected Financial Data" under "LIBERTYVILLE BANCORP, INC."

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16

Crabtree was incorporated in Delaware in 1979. Crabtree is engaged in
the premium finance industry through its subsidiary First Premium. The address
of Crabtree's principal executive office is 475 North Martingale Road, Suite
440, Schaumburg, Illinois 60173 and its telephone number is (847) 517-8030. As
of March 31, 1996, Crabtree had total assets of $18,164,000 and total
shareholders' equity of $2,658,000. See "Business" and "Selected Financial
Data" under "CRABTREE CAPITAL CORPORATION."

THE REORGANIZATION

As a result of the Reorganization, Lake Forest, Hinsdale, Libertyville
and Crabtree will be merged with newly formed merger subsidiaries of North
Shore such that North Shore, the name of which will be changed to Wintrust
Financial Corporation as of the Effective Date, will become the parent holding
company of each of the separate businesses, and the shareholders of each of the
Companies will exchange their shares for Wintrust Common Stock. Under the
terms of the Reorganization Agreement, when the Reorganization becomes
effective, each issued and outstanding share of Lake Forest Common Stock will
be converted into 9.67334 shares of Wintrust Common Stock, each issued and
outstanding share of Hinsdale Common Stock will be converted into 6.03398
shares of Wintrust Common Stock, each issued and outstanding share of
Libertyville Common Stock will be converted into 4.02578 shares of Wintrust
Common Stock, and each issued and outstanding share of Crabtree Common Stock
will be converted into 1.18332 shares of Wintrust Common Stock, except in each
case for any dissenting shares (the "Exchange Ratios"). In addition, each
issued and outstanding share of North Shore Common Stock will be adjusted
pursuant to the North Shore Stock Split to represent 5.16180 shares of Wintrust
Common Stock. Cash will be paid by Wintrust in lieu of issuing fractional
shares. See "Exchange Ratios" under "TERMS OF THE REORGANIZATION."

The Reorganization Agreement also provides that existing articles of
incorporation and by-laws of North Shore will be amended and restated as the
Articles of Incorporation of Wintrust (the "Articles") and By-Laws of Wintrust
(the "By-Laws") providing Wintrust shareholders the rights contemplated by the
Reorganization Agreement and to read substantially as set forth in exhibits to
the Reorganization Agreement and made a part thereof. See "Certain
Anti-Takeover Effects of Wintrust's Articles and By-Laws and Illinois Law"
under "DESCRIPTION OF CAPITAL STOCK OF WINTRUST" and "COMPARATIVE RIGHTS OF
SHAREHOLDERS OF WINTRUST AND THE COMPANIES." The Reorganization Agreement is
included herein as Appendix A to this Joint Proxy Statement/Prospectus.

REASONS FOR THE REORGANIZATION

The Board of Directors of each of the Companies believes that the
approval of the Reorganization Agreement is in the best interest of their
respective Companies and shareholders. The Reorganization will result in a
combined bank holding company having greater access to financial and managerial
resources. While preserving the focus on highly personalized services of the
individual banks and the benefits of local, decentralized management of
community based banking, the resulting multi-bank holding company should enable
the subsidiary banks and subsidiary premium finance company to compete more
effectively with other larger and more diversified banks, bank holding
companies and other financial services companies in the current and future
economic, legal and competitive environment facing all financial institutions.
Furthermore, the Boards believe that the Reorganization should establish a
combined organization with the size and resources necessary to raise capital
through the public equity markets in order to support anticipated further
growth and to achieve liquidity for shareholders through the anticipated
development of a public trading market for the Wintrust Common Stock. However,
there can be no assurance that the Reorganization will have these results. See
"Reasons for the Reorganization and Board Recommendations" under "BACKGROUND OF
THE REORGANIZATION." See "BACKGROUND OF THE REORGANIZATION" and "WINTRUST
FINANCIAL CORPORATION."

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RECOMMENDATIONS OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS AND THE DISINTERESTED DIRECTORS (AS DEFINED
BELOW) OF EACH OF THE COMPANIES HAVE APPROVED THE REORGANIZATION AGREEMENT AND
UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS VOTE FOR APPROVAL OF THE
REORGANIZATION AGREEMENT. The initial terms of the Reorganization Agreement
were proposed by the Companies' shared senior management team and the final
terms were approved by each of the Special Committees established by the Boards
of Directors of each of the Companies to consider the proposal. The Special
Committees gave consideration to many factors, including, without limitation,
information concerning the relative financial positions, earnings and future
prospects of each Company, as well as the respective growth potential of each
of the Companies based upon their respective businesses, locations and market
areas. The Boards of Directors, including in each case those directors of the
Company who do not serve as directors of any other party to the Reorganization
(the "disinterested directors"), after consideration of the terms and
conditions of the Reorganization Agreement and other factors deemed relevant by
the Boards of Directors, including the opinions of Howe Barnes Investments,
Inc. ("Howe Barnes") and the recommendation of their respective Special
Committees to approve the transaction, believe that the terms of the
Reorganization Agreement are fair and that the Reorganization is in the best
interests of their respective Companies and their shareholders. See "Reasons
for the Reorganization and Board Recommendations" and "Opinions of Howe Barnes
Investments, Inc." under "BACKGROUND OF THE REORGANIZATION."

OPINIONS OF HOWE BARNES INVESTMENTS, INC.

Howe Barnes has furnished an opinion to the Board of Directors of each
of the Companies that the financial terms of the Reorganization Agreement,
pursuant to which shares of Common Stock of each of the Companies will be
converted into shares of Wintrust Common Stock, are fair to the shareholders of
each Company from a financial point of view (the "Fairness Opinions"). The
Fairness Opinions, which are included in this Joint Proxy Statement/Prospectus
as Appendix B, should be read in their entirety for information with respect to
the assumptions made, matters considered, and the limitations in the review
undertaken in rendering such opinions. See "Opinions of Howe Barnes
Investment, Inc." under "TERMS OF THE REORGANIZATION."

EXCHANGE OF STOCK CERTIFICATES

If the Reorganization Agreement is approved and the Reorganization is
consummated, instructions on how to exchange certificates representing shares
of any of the Companies' Common Stock for certificates representing shares of
Wintrust Common Stock will be sent to each shareholder of record of each of the
Companies on or shortly after the effective date of the Reorganization. See
"Surrender of Certificates" under "TERMS OF THE REORGANIZATION."

SHAREHOLDERS SHOULD NOT SEND IN THEIR STOCK CERTIFICATES UNTIL THEY
RECEIVE THE LETTER OF TRANSMITTAL FORM AND INSTRUCTIONS FROM WINTRUST.

CERTAIN MATERIAL FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION

An opinion of counsel has been obtained from Blackman Kallick
Bartelstein, LLP ("Blackman Kallick") to the effect that the Reorganization
will constitute a reorganization for federal income tax purposes within the
meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the
"Code"), subject to customary assumptions and representations, with the
consequences that no gain or loss will be recognized by the shareholders of the
Companies except with respect to the receipt of cash in lieu of a fractional
share of Wintrust Common Stock or upon the exercise of dissenters' rights. See
"Certain Material Federal Income Tax Consequences of the Reorganization" under
"TERMS OF THE REORGANIZATION."

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SHAREHOLDERS SHOULD READ CAREFULLY THE DISCUSSION SET FORTH UNDER
"TERMS OF THE REORGANIZATION -- CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE
REORGANIZATION" AND ARE URGED TO CONSULT THEIR OWN TAX ADVISORS AS TO THE
SPECIFIC CONSEQUENCES TO THEM OF THE REORGANIZATION UNDER FEDERAL, STATE, LOCAL
AND ANY OTHER APPLICABLE TAX LAWS.

REGULATORY APPROVALS AND OTHER CONDITIONS

As a condition to consummation of the Reorganization, the
Reorganization Agreement must be approved by the requisite shareholder vote of
each of the Companies. In addition, the consummation of the Reorganization is
subject to required bank regulatory approvals and the satisfaction of certain
other conditions.

On June ___, 1996, Wintrust filed an application with the Board of
Governors of the Federal Reserve System (the "Federal Reserve") under the Bank
Holding Company Act of 1956, as amended (the "BHC Act"), for the required
approval of the Reorganization. By letter dated __________, 1996, the Federal
Reserve deemed the application informationally complete, and accepted the
application for processing under delegated authority. It is anticipated that
the Federal Reserve will render its decision on the application by __________,
1996. There are no assurances that all the required regulatory approvals will
be obtained or when such required approvals will be obtained. See "Regulatory
Approvals" and "Conditions to the Reorganization" under "TERMS OF THE
REORGANIZATION."

WAIVER, AMENDMENT AND TERMINATION

The Reorganization Agreement provides that the parties to the
Reorganization Agreement may waive compliance with any obligations or other
acts of the parties provided for in the Reorganization Agreement. See
"Termination, Amendment and Waiver" under "TERMS OF THE REORGANIZATION."

The Reorganization Agreement and all related agreements may be amended
at any time before or after approval of the Reorganization Agreement by the
mutual agreement of the parties thereto; provided, however, that any amendment
subsequent to the approval of the Reorganization by each of the Companies'
shareholders may not impact the Exchange Ratios or North Shore Stock Split.
See "Termination, Amendment and Waiver" under "TERMS OF THE REORGANIZATION."

The Reorganization Agreement may be terminated at any time prior to
consummation of the Reorganization by the mutual agreement of the parties
thereto. See "Termination, Amendment and Waiver" under "TERMS OF THE
REORGANIZATION."

DISSENTERS' RIGHTS

Sections 11.65 and 11.70 of the IBCA and Section 262 of the General
Corporation Law of Delaware ("DGCL") (which are included herein as Appendices C
and D, respectively) allow a shareholder who objects to a merger and who
complies with those sections to dissent from the merger and to have paid to him
the fair cash value of his shares. See "Dissenters' Rights" under "TERMS OF
THE REORGANIZATION." To the extent dissenters' rights are exercised, they will
be satisfied from general funds of Wintrust. The Board of Directors may
terminate the Reorganization if shareholders owning 10% or more of the Common
Stock of any of the Companies, or on a combined basis, the shares of Wintrust
Common Stock to be outstanding, exercise dissenters' rights.

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RESALES OF WINTRUST COMMON STOCK BY AFFILIATES

The resale of Wintrust Common Stock issued in connection with the
Reorganization to "affiliates" (as such term is defined by Rule 145 promulgated
by the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Securities Act")) of the Companies
will be subject to restriction. Such shares may only be sold (a) pursuant to a
separate registration statement relating to such affiliates' shares of Wintrust
Common Stock (which Wintrust has not agreed to provide); (b) pursuant to the
terms and conditions of Rule 145 promulgated under the Securities Act by the
Commission which impose certain volume limitations and manner of sale
requirements for a period of two years following the Reorganization; or (c)
pursuant to some other exemption from registration. For Wintrust to be able to
account for the Reorganization as a "pooling-of-interests," certain additional
restrictions will be placed on affiliates of the Companies with respect to
Wintrust Common Stock during the period beginning 30 days before the
Reorganization and ending when the results for at least 30 days of
post-Reorganization combined operations have been published. See "TERMS OF THE
REORGANIZATION -- Resale of Wintrust Common Stock."

MARKET PRICES OF COMMON STOCK

None of the Companies' Common Stock has ever been the subject of
published quotations in an over-the counter market nor have any established
public trading markets ever developed for any of the Companies' Common Stock.
Based on information supplied to the Companies, trading has occurred in
sporadic, privately negotiated transactions. While there can be no assurances,
it is anticipated that certain broker dealers may commence making a market in
Wintrust Common Stock after the Reorganization in light of the combined number
of shareholders and the greater volume of shares to be outstanding.

COMPARATIVE PER SHARE DATA

The following table presents comparative net income and book value per
share data for the Companies on a historical basis and a pro forma equivalent
basis, assuming the Reorganization had been effective during the periods
presented. No common stock dividends have been paid by North Shore, Lake
Forest, Hinsdale or Libertyville since their inception, and Crabtree has paid
no dividends during the last five years. The pro forma information gives
effect to the Reorganization accounted for as a "pooling-of-interests" and is
based on the North Shore Stock Split and the respective Exchange Ratios set
forth elsewhere herein. This table should be read in

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conjunction with the Companies' consolidated financial statements and the Pro
Forma Condensed Combined Financial Information, including in each case the
notes thereto, which appear elsewhere herein.

THREE MONTHS
ENDED YEAR ENDED DECEMBER 31,
MARCH 31, ----------------------------------------------------------
1996 1995 1994 1993
--------------- --------------- --------------- -------------

Net Income (Loss) per Common
Share from Continuing Operations(1) :
North Shore Historical . . . . . . . . $ (0.95) $ (4.29) $ (12.26) N/A
Pro Forma Equivalent Combined . . . $ (0.28) $ 1.37 $ (2.27) N/A
Lake Forest Historical . . . . . . . . $ 1.01 $ 5.95 $ 3.05 $ 1.32
Pro Forma Equivalent Combined . . . $ (0.53) $ 2.57 $ (4.26) $ (9.00)
Hinsdale Historical . . . . . . . . . . $ 0.31 $ 2.04 $ (6.11) $ (12.55)

Pro Forma Equivalent Combined . . . $ (0.33) $ 1.61 $ (2.66) $ (5.61)

Libertyville Historical . . . . . . . . $ (1.64) $(14.19) N/A N/A
Pro Forma Equivalent Combined . . . $ (0.22) $ 1.07 N/A N/A
Crabtree Historical . . . . . . . . . . $ (0.03) $ 1.85 $ (0.70) $ (2.71)
Pro Forma Equivalent Combined . . . $ (0.06) $ 0.31 $ (0.52) $ (1.10)

- ---------------
(1) Historical net income (loss) per common share from continuing operations
are computed by dividing net income (loss) per common share from
continuing operations by the sum of the weighted average number of shares
outstanding during the period plus dilutive common stock equivalents
applicable to stock options, stock rights and stock warrants. Pro forma
equivalent combined net income (loss) per common share from continuing
operations are computed by multiplying proforma net income (loss) per
common share from continuing operations by the applicable Exchange Ratio,
or in the case of North Shore, the North Shore Stock Split, so that the
pro forma per share amounts are equated to the respective pro forma values
for one share of the applicable Company.

March 31, December 31,
1996 1995
--------------- ---------------

Book Value per Common Share:(1)
North Shore Historical . . . . . . . . $ 41.80 $ 41.76
Pro Forma Equivalent Combined . . . $ 33.91 $ 33.91
Lake Forest Historical . . . . . . . . $ 62.98 $ 63.77
Pro Forma Equivalent Combined . . . $ 63.55 $ 63.55
Hinsdale Historical . . . . . . . . . . $ 44.72 $ 44.78
Pro Forma Equivalent Combined . . . $ 39.64 $ 39.64
Libertyville Historical . . . . . . . . $ 44.90 $ 46.64
Pro Forma Equivalent Combined . . . $ 26.45 $ 26.45
Crabtree Historical . . . . . . . . . . $ 2.59 $ 2.62
Pro Forma Equivalent Combined . . . $ 7.77 $ 7.77

_
(1) Historical book value per share is computed by dividing shareholders'
equity by the number of shares of the respective companies, as the case
may be, outstanding at the balance sheet date, adjusted for the number of
shares resulting from the exercise of dilutive stock options, stock rights
and stock warrants. The pro forma equivalent combined book values per
share represent the pro forma combined book value of $6.57 and
$6.57 as of March 31, 1996 and December 31, 1995, respectively,
multiplied by the applicable Exchange Ratio, or, in the case of North
Shore, the North Shore Stock Split, so that the pro forma per share
amounts are equated to the respective pro forma book value for one share
of the applicable Company.

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RISK FACTORS AND CERTAIN OTHER CONSIDERATIONS

POTENTIAL CONFLICTS OF INTEREST

Certain directors of the Companies (i) presently serve as officers and
directors of more than one of the Companies; (ii) have been designated to serve
as directors and/or officers of Wintrust following the Effective Date; and/or
(iii) are shareholders of more than one of the Companies. For these reasons,
certain directors and officers of the Companies may not be independent and may
be considered to have conflicts of interest with respect to the Reorganization
and Reorganization Agreement. In addition, the Companies have retained common
legal, accounting, tax and financial advisors to represent them with respect to
various matters involved in this transaction. See "BACKGROUND OF THE
REORGANIZATION." See also "TERMS OF THE REORGANIZATION -- Interests of Certain
Persons in the Reorganization; Conflicts of Interests." Shareholders are urged
to carefully read this Joint Proxy Statement/Prospectus and rely on their own
judgment in evaluating the advisability and fairness of the Reorganization
Agreement.

RELIANCE ON KEY PERSONNEL

Wintrust's success will be largely dependent on its continuing ability
to retain the services of the Companies' existing senior management, including
Howard D. Adams and Edward J. Wehmer, and the management teams of each of the
Banks and First Premium, and, as Wintrust grows, to attract and retain
qualified additional senior and middle management. The unexpected loss of
services of any of the key management personnel, or the inability to recruit
and retain qualified personnel in the future, could have an adverse effect on
Wintrust's business and financial results. It is anticipated that Wintrust and
its subsidiaries will enter into management employment contracts or other forms
of understanding with senior management; however, the terms and conditions of
such arrangements have not yet been finalized.

ADDITIONAL CAPITAL NEEDS

It is anticipated that Wintrust will need to raise additional capital
in 1996 in order to support the growth of the Banks. While management believes
that sufficient debt and/or equity capital is available, and that Wintrust, as
a combined organization, will be able to access more efficient sources of
capital than any of the Companies on a stand alone basis, there can be no
assurance that the needed funds will be raised on pricing terms deemed
favorable by existing shareholders. To the extent such capital is funded
through the issuance of additional equity, Wintrust shareholders may experience
dilution and their percentage ownership will be diluted as a result of an
offering unless they acquire shares in that offering proportionate to their
current ownership interest in Wintrust. See "WINTRUST FINANCIAL
CORPORATION -- Proposed Public Offering."

LIMITED MARKET FOR SHARES

While the shares of Wintrust Common Stock to be issued in the
Reorganization will be freely tradeable by persons other than those who are
currently affiliates of any of the Companies, there has been no prior public
market for the shares of any of the Companies and there can be no assurance
that an active public market will necessarily develop for the Wintrust Common
Stock. However, it is anticipated that with more than 6.4 million shares to be
outstanding and more than [1,000] shareholders of Wintrust after consummation
of the Reorganization, certain broker dealer firms may commence making a
limited market in such shares.

Management is currently considering the feasibility of publicly
offering shares of Wintrust Common Stock during the second half of 1996 in
order to address additional capital needs. There can be no assurance, however,
that an offering will be made at that time or any future time or that a public
market will develop as a result of any such proposed public offering.
Management is unable to predict at what price such a market, if any, may
develop. See "WINTRUST FINANCIAL CORPORATION -- Proposed Public Offering."

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CERTAIN ANTI-TAKEOVER PROVISIONS

Certain provisions of Wintrust's Articles and By-Laws, which will
become effective as part of the Reorganization, and the Illinois Business
Corporation Act ("IBCA") may have the effect of impeding the acquisition of
control of Wintrust by means of a tender offer, a proxy fight, open-market
purchases or otherwise in a transaction not approved by the Board of Directors
of Wintrust. These provisions may have the effect of discouraging a future
takeover attempt which is not approved by the Board of Directors. Such
provisions will also render the removal of the current Board of Directors or
management of Wintrust more difficult. Such provisions include, among other
things, the authorization of "blank check" preferred stock, staggering the
board of directors, limiting the filling of Board vacancies to the Board of
Directors, prohibiting shareholder action by written consent, election of the
IBCA "fair price" provision, requiring advance notice with respect to
shareholder proposals and director nominations and requiring an 85% vote of the
shareholders to amend certain anti-takeover provisions in the Articles and
By-Laws. Shareholders are encouraged to read carefully Wintrust's Articles and
By-Laws which are included in this Joint Proxy Statement/Prospectus as Exhibits
B and C, respectively, to the Reorganization Agreement which is set forth in
Appendix A.

It is anticipated that the Board of Directors of Wintrust will
consider and may implement a shareholder rights plan ("rights plan") subsequent
to the consummation of the Reorganization to deter coercive, hostile bids for
corporate control and encourage a potential acquiror to negotiate with the
Board of Directors. A rights plan, if implemented, will have also certain
anti-takeover effects. See "Certain Anti- Takeover Effects of Wintrust's
Articles and By-Laws and Illinois Law" under "DESCRIPTION OF CAPITAL STOCK OF
WINTRUST."

IMPACT OF DE NOVO OPERATIONS ON WINTRUST PROFITABILITY

Each of the Banks was organized as a de novo banking organization
within the past five years. Typically, de novo banks require 18 months to
three years of operation before becoming profitable due to the impact of
organizational and overhead expenses and the time lag typically involved in
redeploying deposits into attractively priced loans and other higher yielding
earning assets. Libertyville, formed in 1994, is still in the start-up phase,
and Libertyville Bank, which commenced operations in October 1995, is not yet
profitable. North Shore, which commenced operations in September 1994,
recorded net losses for 1994 and 1995 and has recently incurred the
organizational costs associated with opening two new branches, one in
Glencoe in 1995 and one in Winnetka in 1996. Hinsdale, which commenced banking
operations in October 1993, recorded net losses for both 1993 and 1994, and
first recorded net income for 1995. While management believes that each of
these Banks has demonstrated significant success to date in deposit generation
and will likely continue to increase its loan-to-deposit ratio as loan
origination activities increase, the reported net income and return on average
assets for Wintrust will in the near term be impacted by start-up costs
associated with these and possible future de novo operations. See "WINTRUST
FINANCIAL CORPORATION -- Possible Acquisitions" for information regarding a
possible acquisition from certain directors of the Companies of a corporation
formed to organized a de novo bank in a northwestern suburb of Chicago.

ALLOWANCE FOR LOAN LOSSES

The Banks' and First Premium's allowances for loan losses are
maintained at a level considered adequate by management to absorb anticipated
losses. While none of the Banks nor First Premium has experienced any
significant charge-offs since inception, the amount of future losses is
susceptible to changes in economic, operating and other conditions, including
changes in interest rates, that may be beyond Wintrust's control, and such
losses may exceed current estimates. Although management believes that the
allowances for loan losses are adequate to absorb any losses on existing loans
that may become uncollectible, there can be no assurance that the allowance
will prove sufficient to cover actual loan losses in the future. In
particular, First Premium is currently seeking to recover the approximately
$1.1 million remaining amount related to an approximately $5.0 million premium
finance loan that was fraudulently obtained by the obligor, through pending
litigation in which First Premium has filed claims against several defendants,
including the obligor corporation, certain agents of the obligor and the
insurance company. While First Premium management believes it will ultimately
recover the remaining amount and associated

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costs of recovery and therefore has not fully reserved against possible loss of
these sums, there can be no assurances when or if such funds will be received.

EFFECT OF INTEREST RATES

Like most banks, the Banks will realize income primarily from the
spread between interest earned on loans and investments and the interest paid
on deposits and borrowings. It is expected that the Banks from time to time
will experience "gaps" in the interest rate sensitivities of their assets and
liabilities, meaning that either their interest-bearing liabilities will be
more sensitive to changes in market interest rates than their interest-earning
assets, or vice versa. In either event, if market interest rates should move
contrary to the Banks' position, the "gap" will work against the Banks and
their earnings may be negatively affected. Management will actively monitor
the interest rate sensitivities of the assets and liabilities of the Banks and
will work to prevent any gaps from approaching imprudent levels.

REGULATORY RESTRICTIONS ON DIVIDENDS

None of the Companies has previously paid regular quarterly dividends.
While there can be no assurances, it is anticipated that Wintrust may commence
payment of dividends out of funds legally available therefor. Wintrust's
sources of funds for dividend payments will consist primarily of dividends from
its direct and indirect subsidiaries. Under the provisions of the Illinois
Banking Act, dividends may not be declared by the Banks except out of each
Bank's net profit (as defined therein), and unless each Bank has transferred to
surplus at least one-tenth of its net profits since the date of the declaration
of the last preceding dividend, until the amount of its surplus is at least
equal to its capital. Presently, the surplus of each of the Banks equals or
exceeds regulatory capital. There are no regulatory restrictions on
declaration of dividends by Crabtree. There are, however, certain dividend
restrictions in the financial covenants of First Premium's securitization
facility and credit agreements of certain of the Companies that may limit
payment of dividends to Wintrust.

FINANCIAL INSTITUTION REGULATION

Wintrust, the Banks and their bank holding companies are subject to
extensive federal and state legislation, regulation and supervision. Recently
enacted, proposed and future legislation and regulations have had, will
continue to have or may have significant impact on the financial services
industry. Some of the legislative and regulatory changes may benefit Wintrust
and the Banks; others, however, may increase their costs of doing business and
thereby assist competitors.

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BACKGROUND OF THE REORGANIZATION

Each of the Companies shares certain common members of their senior
management teams, a number of common directors and numerous overlapping
investors. Howard D. Adams, the principal founding shareholder of each of the
organizations, is the Chairman or Vice Chairman of each of the Boards of
Directors. Together with members of his family, he is also the largest
shareholder of each of the Companies. Edward J. Wehmer, a principal organizer
of each of the banking organizations, is a director and Vice Chairman of each
of the Companies other than Crabtree.

Commencing in January 1996, Messrs. Howard Adams, Wehmer, David A.
Dykstra, the chief financial officer of each of the bank holding companies,
Alan W. Adams, and a management representative of Crabtree, began seriously
exploring the possibility of combining the five companies into a common holding
company structure. The strategic rationale of the proposed consolidations was
to formalize the various cost sharing and shared executive management
arrangements already existent to varying degrees among the different Companies
in order to: (i) enhance operational systems for the ultimate benefit of
customer support; (ii) position the Banks to pursue insurance premium financing
as an additional specialized earning asset niche designed to increase overall
yield on assets; (iii) offer First Premium a lower cost source of funds through
the Banks' participation in premium finance receivables; (iv) provide each of
the Companies improved access as a larger entity to more efficient sources of
the additional capital that was anticipated to be needed in the near future to
fund further growth of the Banks and of First Premium; and (v) potentially
achieve greater liquidity for shareholders through the possible creation of
public market trading in their shares.

By the end of January 1996, management had developed a proposed
transaction structure and an initial proposal regarding the basis for relative
valuations of the five Companies, as well as a sixth company, Wolfhoya, owned
by Howard Adams' family and Ed Wehmer which Howard Adams and Mr. Wehmer
had formed for the purpose of organizing a fifth de novo bank. In early
February 1996, management assembled a team of legal, accounting and tax
advisors to begin evaluating the proposed transaction structure and to advise
the Companies generally regarding various aspects of the proposal. Over the
next approximately eight weeks, management met regularly with its legal, tax
and accounting advisors to refine the terms of the proposed consolidation in
order to accomplish a tax-free reorganization to be accounted for as a
pooling-of-interests.

At Special Meetings of the respective Boards of Directors of the
Companies during the week of April 1, 1996, management introduced the concept
of the proposed Reorganization to each of the Boards, outlining the perceived
strategic benefits and potential business risks. Following management's
presentation, legal counsel reviewed with each of the Boards the fiduciary
responsibilities of the directors in considering a transaction such as that
proposed where certain members of management and the Board may be deemed to
have conflicting loyalties. Each of the Boards appointed a special committee
of disinterested directors to further evaluate the proposed transaction, to
consider retaining common advisors with the other Companies, and to select a
financial advisor to assist in evaluating the fairness to Shareholders of the
proposed transaction from a financial point of view. Each Company also agreed
to share equally with the other Companies the expenses relating to pursuit of
the proposed transaction.

On April 5, 1996, the Special Committees of each of the Companies
convened jointly to review in greater detail with management the terms of the
proposed transaction and to establish a process for further discussions among
the Special Committees in order to ensure fair dealing in arriving at the terms
of any proposed transaction. The Special Committees determined to engage
jointly (i) Vedder, Price, Kaufman & Kammholz as the legal advisor to the
transaction with respect to certain corporate and securities matters, (ii) KPMG
Peat Marwick LLP, to advise as to certain accounting matters, and (iii)
Blackman Kallick Bartelstein, LLP, to advise as to certain tax matters. Each
of the banking Companies separately retained Meltzer, Purtill & Stelle as
corporate and bank regulatory counsel and Crabtree retained Rudnick & Wolfe as
its corporate counsel to advise on certain matters relating to the transaction.
The Special Committees also considered four written proposals received by
management from

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investment banking firms and requested that representatives of Howe Barnes
Investments, Inc. be invited to make a presentation to the combined Special
Committees regarding representing each of the Companies on a combined basis in
connection with delivery of separate fairness opinions to each of the Companies
regarding the proposed exchange ratios.

Thereafter, at a meeting on April 12, 1996, following a presentation
by representatives of Howe Barnes, the Special Committees each engaged Howe
Barnes to evaluate management's proposed exchange ratios and to deliver a
separate opinion to each Company as to whether the proposed exchange ratios
were fair to their respective shareholders from a financial point of view. It
was further agreed that if Howe Barnes did not conclude that the proposed
exchange ratios were fair, they would advise the Special Committees as to
exchange ratios that they did consider to be fair to all parties. Subsequent
thereto, each Special Committee met separately with Howe Barnes, after
consultation with the management team of their respective subsidiary, to
discuss with Howe Barnes those factors the directors considered important in
assessing the valuation of that Company relative to the other Companies.

The Special Committees met together on three subsequent occasions. On
April 23, 1996, additional developments and certain due diligence matters were
discussed, including a presentation by management of First Premium to overview
its premium finance business, followed by a facility tour. On May 7, 1996,
management advised the Special Committees that it had determined not to pursue
the acquisition of Wolfhoya at this time; legal counsel reviewed with the
members of the Special Committees the provisions of the proposed form of the
Reorganization Agreement, including the proposed Articles and By-laws of
Wintrust; and Howe Barnes delivered its oral opinions that the Exchange Ratios,
as modified by Howe Barnes to increase the relative valuation of Libertyville,
were fair to shareholders from a financial point of view.

After several days involving various discussions among members of the
separate Special Committees and management, the committees jointly reconvened
on May 10, 1996, to consider the definitive proposal regarding the
Reorganization including the Exchange Ratios. At the conclusion of this
meeting, each of the Special Committees indicated its intention to recommend
approval of the Reorganization Agreement to its respective Board of Directors.

Special Meetings of the Boards of Directors of each of the Companies
were held during the week of May 13, 1996. At each of these meetings,
management reviewed with the Board the strategic rationale for the proposed
Reorganization, legal counsel reviewed the terms of the definitive
Reorganization Agreement, including the Articles and By-laws of Wintrust, and
representatives of Howe Barnes delivered their oral fairness opinions to the
full boards. At each meeting, following separate discussion among the
disinterested directors of such Board, the disinterested directors of each
Company approved the Reorganization Agreement and, after reconvening the full
board, the full board of each Company approved the Reorganization Agreement,
subject to requisite shareholder approval.

REASONS FOR THE REORGANIZATION AND RECOMMENDATIONS OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS OF EACH COMPANY BELIEVES THAT THE
REORGANIZATION IS FAIR TO, AND IN THE BEST INTERESTS OF, THE RESPECTIVE COMPANY
AND ITS SHAREHOLDERS. THE BOARD OF DIRECTORS OF EACH COMPANY, INCLUDING THE
DISINTERESTED DIRECTORS THEREOF VOTING SEPARATELY, HAVE APPROVED THE
REORGANIZATION AND EACH BOARD UNANIMOUSLY RECOMMENDS TO ITS SHAREHOLDERS TO
VOTE "FOR" APPROVAL AND ADOPTION OF THE REORGANIZATION AGREEMENT.

The Boards of Directors of the Companies, with the assistance of
outside financial and legal advisors, have evaluated the financial, legal and
market conditions bearing on the decision to recommend the Reorganization. The
terms of the Reorganization, including the Exchange Ratios and the North Shore
Stock Split, were initially proposed by the shared senior management team of
the Companies. The final terms of the Reorganization Agreement reflect ensuing
discussions among the Special Committees appointed by the Boards of each of the
Companies, management and the Companies' financial advisor.

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In reaching its conclusion to approve the Reorganization Agreement and
the transactions contemplated thereby, each Board consulted with its respective
management team, as well as its financial and legal advisors, and considered,
among other factors, the following:

(i) each Company's business, financial condition, results
of operations, management and prospects as a stand alone institution,
including but not limited to its potential growth, development,
productivity and profitability, and the business risks associated
therewith;

(ii) the current and prospective environment in which the
Companies operate, including national and local economic conditions,
the competitive environment for financial institutions generally, the
increased regulatory burden on financial institutions generally and
the trend towards consolidation in the financial services industry,
particularly in the Chicago market area;

(iii) information concerning the business, operations,
asset quality and prospects of the Companies on a combined basis,
including the ability of the combined entity to (a) compete more
effectively and weather future unforeseen financial difficulties, (b)
provide enhanced prospects for earlier dividends for shareholders of
the Company, (c) provide shareholders with long term growth potential
and liquidity through publicly registered shares, (d) provide capacity
for a more efficient capital structure, and (e) provide access to more
efficient sources of capital to finance future growth;

(iv) the enhanced ability of the combined entity to
develop additional profitable earning asset niches;

(v) the conclusion of its Special Committee that the
Reorganization is fair to its shareholders and the Special Committee's
recommendation to approve the Reorganization;

(vi) the opinion of Howe Barnes that the Exchange Ratios
and North Shore Stock Split are fair to the holders of Common Stock of
each of the Companies from a financial point of view;

(vii) the review by each Board of Directors with its legal
and financial advisors of the provisions of the Reorganization
Agreement, including the conditions to consummation thereof;

(viii) the belief of the Boards of Directors that the terms
of the Reorganization Agreement are attractive in that they would
allow shareholders of the Companies the opportunity to receive a more
liquid investment in the form of Wintrust Common Stock, while
permitting the shareholders to defer any tax liability associated with
any gain in the value of their investment greater than the amount of
cash received and to become shareholders Wintrust;

(ix) the desirability of retaining access to the existing
common senior management teams that have provided each Company a level
of management, marketing and financial expertise beyond that which the
respective Companies could have otherwise afforded to hire, and the
operational compatibility of the respective business and management
philosophies of the Companies, all of which are committed to
prioritizing localized decisionmaking in order to deliver quality
product and achieve a highly responsive level of personalized customer
service;

(x) the fact that the Companies need additional funds to
support further growth in profitability and the opinion of senior
management that a combined organization would enable the Companies to
raise additional capital more efficiently and on more favorable terms
than any of the Companies could likely achieve on a stand-alone basis;
and

(xi) the alternative strategic courses available to the
Companies, including remaining independent and undertaking other
potential capital raising alternatives.

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In reaching their determination to accept the Reorganization
Agreement, the Boards did not assign any relative or specific weights to the
foregoing factors, and individual directors may have given different weights to
different factors. The importance of these factors relative to one another
cannot be precisely determined or stated herein and there can be no assurance
that the expected results or benefits of the proposed Reorganization will
actually occur. Although there can be no assurance, the Boards of Directors
believe that the Reorganization will provide shareholders with increased value
and liquidity for their stock and will provide their communities and customers
with expanded services and products.

The Board of Directors of each Company unanimously recommend that the
shareholders of the respective Company vote "FOR" approval and adoption of the
Reorganization Agreement.

OPINIONS OF HOWE BARNES INVESTMENTS, INC.

At separate meetings of the Boards of Directors of: Crabtree on May
13, 1996; North Shore and Hinsdale on May 14, 1996; and Lake Forest and
Libertyville on May 15, 1996, at which the terms of the proposed Reorganization
were discussed and considered, Howe Barnes rendered opinions to the Board of
Directors for each of the Companies that, as of the date of such meetings, the
Exchange Ratios are fair, from a financial point of view, to the holders of
Common Stock for each of the Companies. Howe Barnes has confirmed its opinions
by delivery of a written opinion to the Board of Directors of each of the
Companies dated the date of this Proxy Statement stating that, as of the date
hereof and based on the matters set forth in such opinion, the Exchange Ratios
are fair, from a financial point of view, to the holders of common stock for
each of the Companies.

THE FULL TEXT OF HOWE BARNES' OPINIONS DATED THE DATE HEREOF, WHICH
SET FORTH ASSUMPTIONS MADE, PROCEDURES FOLLOWED, MATTERS CONSIDERED, AND LIMITS
ON THE REVIEW UNDERTAKEN BY HOWE BARNES, ARE ATTACHED AS APPENDIX C AND ARE
INCORPORATED HEREIN BY REFERENCE. THE DESCRIPTION OF THE HOWE BARNES OPINIONS
SET FORTH IN THIS JOINT PROXY STATEMENT/PROSPECTUS IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO THE FULL TEXT OF SUCH OPINIONS. SHAREHOLDERS ARE URGED TO READ
THE APPLICABLE HOWE BARNES OPINION IN ITS ENTIRETY.

Each Howe Barnes opinion as expressed herein is limited to the
fairness, from a financial point of view, of the Exchange Ratios to the holders
of the Companies' Common Stock and does not address the Companies' underlying
business decisions to proceed with the Reorganization. Howe Barnes has been
retained on behalf of the Board of Directors of each of the Companies, and its
opinion does not constitute a recommendation to any holder of any of the
Companies' Common Stock as to how such holder should vote with respect to the
Reorganization Agreement at any meeting of holders of the Companies' Common
Stock.

Howe Barnes, as part of its investment banking business, is regularly
engaged in the valuation of banks and bank holding companies, thrifts and
thrift holding companies, and various other financial services companies, in
connection with mergers and acquisitions, initial and secondary offerings of
securities, and valuations for other purposes. The Board of Directors for each
of the Companies selected Howe Barnes on the basis of its familiarity with the
financial services industry, its qualifications, ability, previous experience,
and its reputation with respect to such matters.

For purposes of its opinions dated the date hereof and in connection
with its review of the proposed transaction, Howe Barnes, among other things:
(i) reviewed each of the Companies' audited financial statements and related
financial information for the two fiscal years ended December 31, 1995 (where
available), unaudited financial information for the three months ended March
31, 1996, as well as other internally generated reports relating to
asset/liability management, asset quality, and so forth; (ii) reviewed and
analyzed certain other information bearing upon the financial and operating
condition of each of the other Companies and materials prepared in connection
with the proposed transaction; (iii) conducted discussions with members of the
senior management of each of the Companies concerning the financial condition,
businesses, assets, earnings, and prospects of each, and such senior
management's views as to the future financial performance of each; (iv)
reviewed certain financial forecasts and projections of the Companies as
prepared by the management of each; (v) reviewed the offering document and
private placement memorandum for each of the Companies (where applicable) used
in

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connection with the capitalization of each; (vi) reviewed the recent stock
prices and historical trading activity for the shares of each of the Companies;
(vii) reviewed the Reorganization Agreement and all of the related agreements;
and (viii) reviewed such other financial studies and analyses and performed
such other investigations and took into account such other matters as it deemed
necessary.

Howe Barnes has assumed and relied, without independent verification,
upon the accuracy and completeness of all of the financial and other
information supplied to it by each of the Companies for the purposes of this
opinion. Howe Barnes has also assumed and relied upon the senior management of
each of the Companies as to the reasonableness and achievability of the
financial and operating forecasts (and the assumptions and bases therefor)
provided to it. In that regard, Howe Barnes has assumed that such forecasts
reflect the best currently available estimates and judgment of management and
that such forecasts will be realized in the amounts and in the time periods
currently estimated by the management of each of the Companies. Howe Barnes is
not an expert in the evaluation of allowances for loan losses, and has not made
an independent evaluation of the adequacy of the allowance for loan losses of
each of the Companies, nor has Howe Barnes reviewed any individual loan credit
files and has assumed that the aggregate allowance for loan losses is adequate
to cover such losses. In addition, Howe Barnes has not made an independent
evaluation or appraisal of the assets and liabilities of each of the Companies
or any of their subsidiaries, nor was Howe Barnes furnished with any such
evaluation or appraisal. Its opinion is necessarily based on economic, market,
and other conditions as in effect on, and the information made available to it
as of, the date hereof.

The following is a brief summary of the analysis presented by Howe
Barnes to the Board of Directors of each of the Companies in connection with
Howe Barnes' fairness opinion.

Comparison of Performance. Howe Barnes analyzed the historical
operating results of each of the Companies for 1994 and 1995, including the
balance sheet and income statement, asset quality, current asset/liability
sensitivity, and operating budgets. Because of the limited operating history
for each of the Companies, Howe Barnes also reviewed and analyzed the projected
future performance for each of the Companies through 1999. The projections
reviewed by Howe Barnes were prepared by the managements of each of the
Companies. None of the Companies publicly discloses internal management
projections of the type provided to Howe Barnes in connection with the review
of the merger. Such projections were not prepared with a view toward public
disclosure. The projections were based on numerous variables and assumptions
which are inherently uncertain, including, without limitation, factors related
to general economic and competitive conditions. Accordingly, actual results
could vary significantly from those set forth in such projections.

This analysis showed, among other things, that from 1994 to 1995, Lake
Forest's assets grew 36.8% to $197 million from $144 million, while Lake
Forest's net income grew 99.8% to $1.015 million from $508 thousand for the
same period. From 1994 to 1995 Hinsdale's assets grew 74.2% to $116 million
from $67 million, while net income grew to $420 thousand in 1995 from a net
loss of $893 thousand for 1994. From 1994 to 1995 North Shore's assets grew
132.8% to $105 million from $45 million, while North Shore had net losses of
$862 thousand and $896 thousand for 1995 and 1994, respectively. For 1995
Libertyville had total assets of $37 million and a net loss of $958 thousand.
From 1994 to 1995 Crabtree's assets grew 11.6% to $18.8 million from $16.9
million, while net income grew to $1,882 thousand from a net loss of $955
thousand.

Discounted Cash Flow Analysis. Using discounted cash flow analysis,
Howe Barnes estimated the future dividend streams that each of the Companies
could produce over the period from January 1, 1996 through December 31, 1999,
assuming a minimum required equity level of 5.5% of total assets, if each of
the Companies performed in accordance with forecasts based on the management's
estimates for each of the Companies. Howe Barnes also estimated the net income
capitalization rate for each of the Companies as of December 31, 1999 ranging
from 9.0% to 10.0%. The dividend streams and terminal value were discounted to
present values as of December 31, 1995 using discount rates ranging from 13.0%
to 14.0%, which reflect different assumptions regarding the required rate of
return of holders and prospective buyers of common stock. Howe Barnes'
indicated theoretical values for Lake Forest, based on four-year projections of
return on average assets ranging between 0.70% and 1.40% and asset growth rates
ranging between 14.0% and 27.0%, indicated a range between $138.89

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per share and $159.68 per share. Howe Barnes' indicated theoretical values for
Hinsdale, based on four-year projections of return on average assets ranging
between 0.70% and 1.50% and asset growth rates ranging between 22.0% and 34.0%,
indicated a range between $88.00 per share and $100.92 per share. Howe Barnes'
indicated theoretical values for North Shore, based on four-year projections of
return on average assets ranging between 0.30% and 1.40% and asset growth rates
ranging between 15.0% and 70.0%, indicated a range between $70.41 per share and
$80.86 per share. Howe Barnes' indicated theoretical values for Libertyville,
based on four-year projections of return on average assets ranging between
(0.10)% and 1.40% and asset growth rates ranging between 22.0% and 150.0%,
indicated a range between $55.66 per share and $64.00 per share. Howe Barnes'
indicated theoretical values for Crabtree, based on four-year projections of
net income ranging between $1.0 million and $4.6 million and asset growth rates
ranging between 24.0% and 38.0%, indicated a range between $16.81 per share and
$19.28 per share.

Relative Contribution Analysis. In performing a relative contribution
analysis, Howe Barnes analyzed the contribution of each of the Companies to the
income statement and balance sheet of the consolidated entity on a pro-forma
basis. The balance sheet and income statement items analyzed included, among
other things, the relative contribution to the consolidated entity of each of
the Companies of preliminary unaudited total equity as of March 31, 1996, 1995
net income, and projected net income through 1999. The proposed dollar values
for each of the Companies expressed as a percentage of the total combined
pro-forma value were 24.0%, 18.6%, 20.7%, 13.7%, and 23.0% for Lake Forest,
Hinsdale, North Shore, Libertyville, and Crabtree, respectively.

The relative contribution analysis showed, among other things, that,
as of March 31, 1996, Lake Forest, Hinsdale, North Shore, Libertyville, and
Crabtree would have contributed 25.0%, 22.1%, 25.7%, 21.2%, and 6.0% of total
shareholders' equity, respectively.

Given the limited operating history of several of the Companies as
well as the projected growth potential and future prospects for each, Howe
Barnes considered not only the current level of net income contribution but
also the future projected net income contribution for each of the Companies.
Projected net income for each of the Companies was based on estimates of the
respective managements of the Companies. The relative contribution analysis
also showed, among other things, that Lake Forest, Hinsdale, North Shore,
Libertyville, and Crabtree would have contributed 67.8%, 28.1%, (57.6)%,
(64.0)%, and 125.7% of net income as of December 31, 1995, and 24.8%, 19.2%,
20.3%, 14.2%, and 21.6% of projected net income (exclusive of any cost savings
and revenue enhancements resulting from the Reorganization) as of December 31,
1999, respectively.

The foregoing is a summary of the material financial analyses
performed by Howe Barnes, but does not purport to be a complete description of
the analyses performed by Howe Barnes. The preparation of a fairness opinion
is a complex process and is not necessarily susceptible to partial analysis or
summary description. Selecting portions of the analyses or of the summary set
forth above, without considering the analyses as a whole, could create an
incomplete view of the processes underlying Howe Barnes' opinion. The ranges
of valuations resulting from any particular analysis described above should not
be taken to be Howe Barnes' view of the accrual value of the Companies.

Howe Barnes examined the history of trading prices and volume for
Common Stock of the Companies and found the trading history to be limited in
most cases, and nonexistent in others. None of the Companies trade on any
organized exchange and no active market for the Common Stock of any of the
Companies has developed. As a result, the stock trading history of the
Companies was not deemed by Howe Barnes to be useful in rendering its fairness
opinion. Howe Barnes also attempted to conduct a comparable transaction
analysis by compiling financial data from comparable merger transactions.
Given the unique aspects of this transaction, including the simultaneous merger
of five operating companies, the limited operating history of certain of the
Companies, and the differing asset sizes, profitability levels, and business
lines of the Companies, the usefulness of this valuation technique is
diminished. In Howe Barnes' opinion, a material number of comparable
transactions could not be compiled which would sufficiently reflect the facts
of this transaction. In arriving at its fairness determination, Howe Barnes
considered the results of all such analyses some of which are not mathematical,
but rather involve complex considerations and judgments concerning differences
in operating and financial characteristics including, among other

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things, differences in revenue composition and earnings performance among the
Companies. Reorganization transactions involve unique non-financial issues
that must be negotiated in a fair and equitable manner. Although they are
difficult to quantify, these non-financial issues could influence the
appropriateness of the Exchange Ratios. These issues include, among other
things, the name of the surviving corporation, location of headquarters, board
of directors composition, management structure, and respective ownership by
each Company's shareholders in the surviving corporation. Representatives of
the Companies were responsible for the negotiation of these non-financial
issues, and as such, Howe Barnes has assumed that these factors did not
influence the Exchange Ratios.

In performing its analyses, Howe Barnes made numerous assumptions with
respect to industry performance, business and economic conditions and other
matters, many of which are beyond the control of the Companies. The analyses
performed by Howe Barnes are not necessarily indicative of actual values of
future results, which may be significantly more or less favorable than
suggested by such analyses. Additionally, analyses relating to the values of
assets and liabilities do not purport to be appraisals or to reflect the prices
at which such assets and liabilities actually may be sold or transferred to
another party.

Pursuant to the terms of a letter agreement dated April 8, 1996, and
accepted by each of the Companies on April 23, 1996, each of the Companies
agreed jointly to pay Howe Barnes an aggregate fee of $120,000 for rendering of
its opinion. In addition, the Companies have each agreed to indemnify Howe
Barnes against certain liabilities arising out of its engagement, including
liabilities under the federal securities laws.

TERMS OF THE REORGANIZATION

The following description of the Reorganization is qualified in its
entirety by reference to the Agreement and Plan of Reorganization and Plan of
Merger (collectively, the "Reorganization Agreement"), which is attached hereto
as Appendix A to this Joint Proxy Statement/Prospectus and is incorporated
herein by reference. ALL SHAREHOLDERS ARE ENCOURAGED TO READ THE
REORGANIZATION AGREEMENT IN ITS ENTIRETY.

GENERAL

On the Effective Date, subject to the terms and conditions of the
Reorganization Agreement, LFBII will merge with and into Lake Forest, HBII will
merge with and into Hinsdale, LBII will merge with and into Libertyville, and
Crabtree II will merge with and into Crabtree, with Lake Forest, Hinsdale,
Libertyville and Crabtree to be surviving corporations which will continue to
exist as wholly-owned, mid-tier holding company subsidiaries of Wintrust
(formerly North Shore, the name of which will be changed at the Effective Date
pursuant to the Reorganization). As part of, and simultaneous with the
Effective Date of, the Reorganization, the Articles of Incorporation and
By-Laws of North Shore will be amended and restated pursuant to the terms of
the Reorganization Agreement, and will govern Wintrust until amended or
repealed in accordance with applicable law. The Articles of Incorporation or
Certificate of Incorporation, as the case may be, and by-laws of each of Lake
Forest, Hinsdale, Libertyville and Crabtree in effect at the Effective Date
will govern the respective surviving corporation until amended or repealed in
accordance with applicable law. The separate corporate existences of the Banks
and First Premium will be unaffected by the Reorganization. See "WINTRUST
FINANCIAL CORPORATION -- Operational Philosophy."

EXCHANGE RATIOS

In the Reorganization, each share of Lake Forest Common Stock,
Hinsdale Common Stock, Libertyville Common Stock and Crabtree Common Stock
which is issued and outstanding immediately prior to the Effective Date, other
than dissenting shares, shall be converted into and represent the right to
receive shares of Wintrust Common Stock (the "Wintrust Shares") on the basis of
the Exchange Ratios set forth in the table below. Each share of North Shore
Common Stock which is issued and outstanding immediately prior to the Effective
Date, other than

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dissenting shares, shall be adjusted in the form of a stock split (the "North
Shore Stock Split") so as to represent 5.16180 Wintrust Shares.

The table below sets forth, based on the shares of Common Stock of
each of the Companies issued and outstanding as of May 22, 1996, and assuming
conversion to Common Stock of all preferred shares in accordance with the terms
thereof, (i) respective Exchange Ratios, (ii) the aggregate number of shares of
Wintrust Common Stock to be issued in exchange for the shares of Common Stock
of each Company, and (iii) the resulting percentage ownership of Wintrust
shares to be held by the shareholders of each Company.

Aggregate
Number of
Shares of Pro Forma
Wintrust % of
Common Stock Total
Issuable in Wintrust
Exchange Ratio Exchange(1) Shares(1)(2)
-------------- ------------- ------------

North Shore . . . . . . 5.16180 1,189,841 18.5%
Lake Forest . . . . . . 9.67334 1,580,237 24.6%
Hinsdale . . . . . . . 6.03398 1,196,508 18.6%
Libertyville . . . . . 4.02578 848,840 13.2%
Crabtree . . . . . . . 1.18332 1,612,829(3) 25.1%

_
(1) As of May 22, 1996, assuming full conversion of preferred shares in
accordance with their respective terms and giving effect to cancellation
of all intercompany holdings of Common Stock as provided in the
Reorganization Agreement.

(2) Assumes no exercise of currently outstanding warrants, right and options
to purchase shares of Common Stock of the various Companies other than as
specified in footnote (3) below.

(3) Gives effect to the exercise of a portion of the First Premium common
stock warrants and conversion thereof into 399,612 shares of Wintrust
Common Stock in accordance with the terms of the Reorganization
Agreement. Does not give effect to the possible exercise of the
remaining portion of First Premium warrants which are not anticipated to
be exercised prior to the Effective Date and would thereafter be
exercisable for an additional 48,128 shares of Wintrust Common Stock on
the basis of the Crabtree Exchange Ratio.

Each share of LFBII, HBII, LBII and Crabtree II Common Stock which is
issued and outstanding immediately prior to the Effective Date shall be
converted into the right to receive one share of either Lake Forest Common
Stock, Hinsdale Common Stock, Libertyville Common Stock or Crabtree Common
Stock, as the case may be. The Reorganization Agreement provides that any
shares of Preferred Stock of Lake Forest, Hinsdale, Libertyville and Crabtree
which are issued and outstanding as of the Effective Date will be cancelled, it
being contemplated that all such Shares will have been previously converted to
Common Stock in accordance with provisions of the Reorganization Agreement.

COMMON STOCK WARRANTS

There are outstanding certain Warrants to purchase shares of the North
Shore Common Stock, Hinsdale Common Stock and Libertyville Common Stock (the
"Common Stock Warrants") which, as of March 31, 1996, entitled the holders
thereof to purchase an aggregate of 5,000 shares of North Shore Common Stock,
10,000 shares of Hinsdale Common Stock and 20,760 shares of Libertyville Common
Stock, respectively. Upon consummation of the Reorganization, each such
Warrant that is outstanding immediately prior to the Effective Date shall
remain outstanding after the Effective Date and shall be unaffected by the
Reorganization, except that the North Shore Common Stock Warrants shall be
adjusted to give effect to the North Shore Stock Split.

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As of March 31, 1996, Warrants to purchase 6,493 shares of First
Premium were outstanding (the "First Premium Warrants"). At or prior to the
Effective Date, the Reorganization Agreement requires that the First Premium
Warrants will be amended so as to provide the holders thereof the right to
purchase that number of shares Crabtree Common Stock that will convert, on the
basis of the Crabtree Exchange Ratio, into an aggregate of 447,740 shares of
Wintrust Common Stock (assuming no prior exercise of the Warrants). Any of
such Warrants that are not exercised prior to the Effective Date, will be
converted pursuant to the Reorganization into the right to purchase shares of
Wintrust Common Stock on terms appropriately adjusted to reflect such Exchange
Ratio. The two holders of the First Premium Warrants, Internationale
Netherlanden Bank, N.V. and Deerpath Investments, LLP have indicated their
intention to agree to the proposed amendments to the First Premium warrants.

OPTIONS/RIGHTS

Options/rights (each an "Option" and collectively, the "Options") to
purchase shares of North Shore Common Stock, Lake Forest Common Stock, Hinsdale
Common Stock, Libertyville Common Stock, Crabtree Common Stock, First Premium
Common Stock and Common Stock of The Credit Life Companies, Inc., a Delaware
corporation and wholly-owned subsidiary of Crabtree ("Credit Life"), are
outstanding under several different stock option/rights plans and agreements.
Options to purchase 64,076 shares of North Shore Common Stock, 36,502 shares
Lake Forest Common Stock, 31,455 shares of Hinsdale Common Stock, 22,550 shares
of Libertyville Common Stock, 43,725 shares of Crabtree Common Stock, 1,783
shares of First Premium Common Stock and 74.7 shares of Credit Life Common
Stock were issued and outstanding as of March 31, 1996. Upon consummation of
the Reorganization, each Option, other than the First Premium and Credit Life
Options, that is validly issued and outstanding immediately prior to the
Effective Date will automatically become an option to purchase the number of
shares of Wintrust Common Stock (a "Wintrust Stock Option") determined by
multiplying the number of shares of Lake Forest Common Stock, Hinsdale Common
Stock, Libertyville Common Stock and Crabtree Common Stock subject to the
Options by the respective Exchange Ratio and in the case of North Shore, by the
number of shares represented by the North Shore Stock Split. At or prior to
consummation of the Reorganization, the Options to purchase shares of First
Premium Common Stock or Credit Life Common Stock which are validly issued and
outstanding immediately prior to the Effective Date will be amended so as to
convert into the right to purchase an aggregate of 133,963 shares of Wintrust
Common Stock.

CLOSING DATE OF THE REORGANIZATION

The closing of the Reorganization (the "Closing") will take place on a
date mutually agreed upon by the parties to the Reorganization Agreement as
soon as practicable following satisfaction of the conditions precedent to the
Reorganization. See "-- Conditions to the Reorganization." The parties shall
execute, acknowledge and file, in accordance with the governing corporate law,
a certificate of merger or articles of merger, as the case may be, upon
satisfaction of all conditions precedent to the consummation of the
Reorganization contemplated by the Reorganization Agreement. The date and time
on which the Reorganization becomes effective is referred to herein as the
"Effective Date."

SURRENDER OF CERTIFICATES

As soon as practicable after the Effective Date, Wintrust will mail to
each holder of record of the Common Stock of each of North Shore, Lake Forest,
Hinsdale, Libertyville and Crabtree a letter of transmittal and instructions
for use in effectuating the surrender of such holder's North Shore, Lake
Forest, Hinsdale, Libertyville and Crabtree Common Stock certificates (the
"Certificates").

NO SHAREHOLDERS SHOULD SEND IN THEIR STOCK CERTIFICATES UNTIL THEY
RECEIVE THE LETTER OF TRANSMITTAL FORM AND INSTRUCTIONS FROM WINTRUST.

Upon surrender to Wintrust of one or more Certificates, together with
a properly completed letter of transmittal, Wintrust will cause to be issued
and mailed to holders of North Shore, Lake Forest, Hinsdale, Libertyville and
Crabtree Common Stock, certificates representing the shares of Wintrust Common
Stock plus the

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amount of cash which the holder is entitled to receive in lieu of fractional
shares pursuant to the Reorganization Agreement. The surrendered certificates
of North Shore, Lake Forest, Hinsdale, Libertyville and Crabtree Common Stock
will thereupon be cancelled. No fractional shares of Wintrust Common Stock
will be issued in exchange for shares of North Shore, Lake Forest, Hinsdale,
Libertyville and Crabtree Common Stock and holders thereof will receive cash in
lieu thereof. A Wintrust Common Stock certificate may be issued in a name
other than the name in which the surrendered Certificate(s) is registered only
if a certificate representing such North Shore, Lake Forest, Hinsdale,
Libertyville and Crabtree Common Stock is presented to Wintrust, accompanied by
all documents required to evidence and effect a transfer to the new name and by
evidence that any applicable stock transfer taxes have been paid.

No dividends or other distributions declared after the Effective Date
with respect to Wintrust Common Stock shall be paid to the holder of any
unsurrendered certificate of North Shore, Lake Forest, Hinsdale, Libertyville
and Crabtree Common Stock (with respect to the right to receive any Wintrust
Common Stock represented thereby) until such holder of record shall have
surrendered such North Shore, Lake Forest, Hinsdale, Libertyville and Crabtree
Common Stock certificate in good and proper form. Subject to the effect, if
any, of applicable law, after the subsequent surrender and exchange of a
certificate, the holder thereof shall be entitled to receive any such dividends
or distributions, without interest thereon, which theretofore became payable
with respect to the Wintrust Common Stock represented by such certificate.

CONDITIONS TO THE REORGANIZATION

Consummation of the Reorganization is subject to the satisfaction of
certain conditions unless waived, to the extent waiver is permitted by
applicable law.

In addition to the required regulatory approvals described below, the
obligations of the Companies to effect the Reorganization are subject to the
fulfillment at the Effective Date of the following conditions (unless waived by
the appropriate parties): (i) there shall not be any order, injunction or decree
issued by any court or agency or legal restraint or prohibition preventing the
consummation of the Reorganization in effect, nor any statute, rule, regulation,
order, injunction or decree enacted, promulgated or enforced which prohibits,
materially restricts or makes illegal consummation of the Reorganization; (ii)
the Reorganization Agreement and the Reorganization shall have been approved by
at least 2/3 of the shares of Common Stock of each of North Shore, Hinsdale and
Libertyville entitled to vote thereon; and by at least a majority of the shares
of Common Stock of each of Lake Forest and Crabtree entitled to vote thereon;
(iii) the Fairness Opinion shall not have been withdrawn or materially modified
prior to the Effective Date; (iv) the absence of a stop order suspending
effectiveness of the registration statement of which this Joint Proxy
Statement/Prospectus is a part and/or proceedings seeking such a stop order; (v)
the receipt of all necessary regulatory approvals, including the approval of the
Federal Reserve and any other applicable regulatory authority required to
consummate the Reorganization; (vi) receipt of an opinion from Blackman Kallick
regarding the federal income tax consequences of the Reorganization
substantially to the effect that, among other matters, the shareholders of the
Constituent Corporations will not recognize taxable gain by reason of the
Reorganization except to the extent of cash received in lieu of fractional
shares; (vii) receipt of an opinion from KPMG Peat Marwick LLP to the effect
that the Reorganization will qualify for "pooling-of-interests" method of
accounting and a favorable pooling letter from Arthur Andersen, LLP ("Arthur
Andersen") with respect to certain pooling issues relating to Crabtree and its
former and current subsidiaries; (viii) the First Premium Warrants shall have
been amended so as to provide the holders thereof the right to acquire upon
conversion or exercise an aggregate of 447,740 shares of Wintrust Common Stock;
(ix) the First Premium and Credit Life Options shall have been amended so as to
provide for the conversion of the Credit Life Options into the right to acquire
shares of First Premium on the Effective Date and the conversion of all options
to acquire First Premium Common Stock issued and outstanding immediately prior
to the Effective Date into the right to acquire an aggregate of 133,963 shares
of Wintrust Common Stock; (x) as of the Effective Date, there shall have been no
adverse change or changes in the assets, liabilities, properties, financial
condition, results of operations or business prospects of any one or more of the
Companies and their respective subsidiaries, taken as a whole, which would be
materially adverse to the results of operations, financial condition or business
prospects of Wintrust on a combined basis; and (xi) the merger of Credit Life
with and into First Premium shall have been completed.

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34

REGULATORY APPROVALS

Federal Reserve. The Reorganization is subject to prior approval by
the Federal Reserve under the BHC Act, which requires that the Federal Reserve
take into consideration, among other factors, the financial and managerial
resources and future prospects of the respective institutions and the
convenience and needs of the communities to be served. The BHC Act prohibits
the Federal Reserve from approving the Reorganization if the Reorganization
would result in a monopoly or be in furtherance of any combination or
conspiracy to monopolize or to attempt to monopolize the business of banking in
any part of the United States, or if the effect of the Reorganization in any
section of the country may be to substantially lessen competition or tend to
create a monopoly, or if it would in any other manner be a restraint of trade,
unless the Federal Reserve finds that the anticompetitive effects of the
Reorganization are clearly outweighed in the public interest by the probable
effect of the transaction in meeting the convenience and needs of the
communities to be served. It is highly improbable that the Reorganization
poses any antitrust issues. The Federal Reserve also has the authority to deny
an application if it concludes that the combined organization would have an
inadequate capital position. Furthermore, the Federal Reserve will assess the
records of the Banks under the Community Reinvestment Act of 1977, as amended
(the "CRA"). The CRA requires that the Federal Reserve analyze, and take into
account when evaluating an application, each bank's record of meeting the
credit needs of its local communities, including low- and moderate-income
neighborhoods, consistent with safe and sound operation.

Under the BHC Act, the Reorganization may not be consummated up to 30
days following the date of the Federal Reserve approval, during which time the
Department of Justice ("DOJ") may challenge the Reorganization on antitrust
grounds. The Federal Reserve, in conjunction with the DOJ, may reduce the
30-day waiting period to 15 days. The commencement of an antitrust action
would stay the effectiveness of the Federal Reserve's approval unless a court
specifically orders otherwise. The BHC Act provides for the publication of
notice and public comment on the applications and authorizes the regulatory
agency to permit interested parties to intervene in the proceedings.

Under the Federal Reserve's regulations, the Federal Reserve is
required to act on the application within the 60-day period (reduced to 30 days
if the Federal Reserve delegates processing of the application to the Federal
Reserve Bank of Chicago) that begins on the date of submission to the Federal
Reserve of a complete record of the application (a period that will be tolled
by any public comments or other circumstances that may trigger further requests
for information from the Federal Reserve).

Wintrust filed its application with the Federal Reserve on [June]
_____, 1996. By letter dated ________, 1996, the Federal Reserve deemed the
application informationally complete, and accepted the application for
processing under delegated authority. It is anticipated that the Federal
Reserve will render its decision on the application by _____________, 1996.
There can be no assurance that the Federal Reserve will continue processing the
application under delegated authority.

There can be no assurance that the Federal Reserve will approve the
Reorganization, and if the Reorganization is approved, there can be no
assurance as to the date of such approval. There can likewise be no assurance
that the DOJ will not challenge the Reorganization or, if such a challenge is
made, as to the result thereof.

The Reorganization cannot proceed in the absence of all requisite
regulatory approvals. See "-- Conditions to the Reorganization," "-- Closing
Date of the Reorganization" and "-- Termination, Amendment and Waiver." The
Companies have agreed to take all reasonable actions necessary to obtain
approvals and comply with the requirements of the Federal Reserve and other
governmental entities.

The Companies are not aware of any other governmental approvals or
actions that are required for consummation of the Reorganization except as
described above. Should any other approval or action be required, it is
presently contemplated that such approval or action would be sought. There can
be no assurance that any such approval or action, if needed, could be obtained
and, if such approvals or actions are obtained, there can be no assurance as to
the timing thereof.

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CONDUCT OF BUSINESS PENDING THE REORGANIZATION

Under the Reorganization Agreement, pending consummation of the
transaction each of the Companies is generally obligated to (i) operate and
conduct its respective business only in the ordinary course consistent with
past practices; (ii) preserve, and to cause its respective operating
subsidiaries to preserve, their respective business organizations; (iii) use
best efforts to keep available the services of its respective present officers,
key employees, and agents; and (iv) use its best efforts to preserve the
goodwill of its key suppliers, customers and others having material business
relations therewith, except in each case where the loss of such services or
relationships will not have a material adverse effect on the financial
condition or business prospects of Wintrust.

In this regard, each of the Companies has agreed: (i) not to make any
material change in its respective business or operations; (ii) to maintain its
respective property and physical assets in as good a state of operating
condition and repair, except for ordinary depreciation and wear and tear; (iii)
subject to certain exceptions, not to sell, pledge, lease, mortgage, encumber
or otherwise dispose of any of its respective assets, other than pursuant to
transactions in the normal course of business for fair value; (iv) to keep in
force all policies of insurance covering its respective businesses, properties
and assets and any of its respective subsidiaries and all policies of insurance
providing for directors and officers errors and omission coverage except as
same may be replaced with policies of insurance providing substantially similar
coverage; (v) except as otherwise contemplated in the Reorganization Agreement
or as provided for above in clause (iii) above, not to incur or agree to incur
any obligations to issue, sell, pledge or dispose of, or otherwise encumber,
any of its respective shares of capital stock, or any options, rights, or other
securities convertible into such shares, options, rights or other securities;
(vi) not to authorize or pay or agree to pay or accrue any increased wage,
salary or other remuneration of the directors, officers or other key employees
or agents of any of the Companies or North Shore Bank and not to authorize or
make any material changes in compensation or policy regarding compensation
payable or to become payable to any directors, officers or other employees, of
any of the Companies and their respective subsidiaries; (vii) not to declare,
set aside or pay any dividends on, or make any other actual, constructive or
deemed distributions in respect of, any of its respective capital stock, or
otherwise make any payments to its respective shareholders in their capacity as
such; except as contemplated in the Reorganization Agreement, not to 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 or any rights, warrants or options to acquire
any such shares; or, except as contemplated in the Reorganization Agreement,
not to purchase, redeem or otherwise acquire any shares of its respective
capital stock or any rights, warrants or options to acquire any such shares;
(viii) not to amend its respective Articles of Incorporation or Certificate of
Incorporation (as the case may be) or amend in any material respect its
By-Laws, except as provided for in the Reorganization Agreement; (ix) not to
acquire or agree to acquire by merging or consolidating with, or by purchasing
a portion of the assets of or equity in, or by any other manner, any business
or any corporation, partnership, association or other business organization or
division thereof; (x) not to change any accounting policies, procedures or
practices currently employed by it except for any such changes as may be
required to be implemented by GAAP or any other such changes which will not
have material effect on its financial condition or results of operations; or
(xi) not to enter into any material contract, agreement or lease or make any
material change in any existing contracts, agreements or leases except in the
ordinary course of business consistent with past practices.

Pursuant to the terms of the Reorganization Agreement, the Companies
have agreed not to, and will cause their respective subsidiaries not to, borrow
any money other than in the usual and ordinary course of business.

In addition, except with the prior consent of the other parties and
subject to certain exceptions, none of the Companies shall make, nor shall they
permit their respective subsidiaries to make, any extension of credit or
commitment to make any extension of credit not consistent with their current
lending policies or in excess of their current internal lending limits or to
any customer who is listed on their respective loan watch list as of the date
of the execution of the Reorganization Agreement.

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CERTAIN MATERIAL FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION

The Companies have received an opinion of Blackman Kallick that the
Reorganization will qualify as a tax-free reorganization under Section
368(a)(1)(A) of the Code. Accordingly, the Companies will recognize no gain or
loss for federal income tax purposes as a result of the Reorganization and no
gain or loss will be recognized by any Company shareholder upon receipt of
Wintrust Common Stock pursuant to the Reorganization (except upon the receipt
of cash in lieu of fractional shares of Wintrust Common Stock). The Internal
Revenue Service ("Service") has not been asked to rule upon the tax
consequences of the Reorganization and such request will not be made. The
opinion of Blackman Kallick is based entirely upon the Code, regulations now in
effect thereunder, current administrative rulings and practice, and judicial
authority, all of which are subject to change. Unlike a ruling from the
Service, an opinion of counsel is not binding on the Service and there can be
no assurance, and none is hereby given, that the Service will not take a
position contrary to one or more positions reflected herein or that the opinion
will be upheld by the courts if challenged by the Service. EACH SHAREHOLDER IS
URGED TO CONSULT HIS OR HER OWN TAX AND FINANCIAL ADVISORS AS TO THE EFFECT OF
SUCH FEDERAL INCOME TAX CONSEQUENCES ON HIS OR HER OWN PARTICULAR FACTS AND
CIRCUMSTANCES AND ALSO AS TO ANY STATE, LOCAL, FOREIGN OR OTHER TAX
CONSEQUENCES ARISING OUT OF THE REORGANIZATION.

Based upon the opinion of Blackman Kallick, which in turn is based
upon various representations and subject to various assumptions and
qualifications, the following federal income tax consequences to the Companies'
holders will result from the Reorganization:

(i) Provided (a) that the merger of Lake Forest II with
and into Lake Forest, Hinsdale II with and into Hinsdale, Libertyville
II with and into Libertyville, and Crabtree II with and into Crabtree
qualify as statutory mergers under applicable state law, (b) that
after the transaction, each Company will hold substantially all of its
assets and the assets of the respective Reorganization Subsidiary, and
(c) that in the transaction, the shareholders of each Company exchange
an amount of stock constituting control of the Company (within the
meaning of section 368(c)) solely for Wintrust Common Stock, each
proposed merger will constitute a reorganization within the meaning of
section 368(a)(1)(A) of the Code. The Reorganization will not be
disqualified by reason of the fact that the Common Stock of Wintrust
will be used in the merger. (For purposes of the Blackman Kallick tax
opinion, "substantially all" means at least 90 percent of the fair
market value of the net assets and at least 70 percent of the fair
market value of the gross assets of each of the Companies and
Reorganization Subsidiaries. Wintrust, and each of the Companies and
Reorganization Subsidiaries will each be a "party to a reorganization"
within the meaning of section 368(b) of the Code;

(ii) No gain or loss will be recognized to each
Reorganization Subsidiary upon the transfer of its assets to the
respective Company in exchange for the shares of Company Common Stock;

(iii) No gain or loss will be recognized to the Company
upon the receipt of the assets of the respective Reorganization
Subsidiary in exchange for the Company Common Stock;

(iv) The basis of the Reorganization Subsidiary's assets
in the hands of the respective Company will be the same as the basis
of those assets in the hands of the Reorganization Subsidiary
immediately before the Reorganization;

(v) The holding period of the assets of the
Reorganization Subsidiary in the hands of the Company will include the
period during which such assets were held by the Reorganization
Subsidiary;

(vi) No gain or loss will be recognized to Wintrust upon
the receipt of the Company Common Stock solely in exchange for the
Reorganization Subsidiary Common Stock;

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(vii) No gain or loss will be recognized to the Company
shareholders upon the receipt of stock solely in exchange for their
shares of Company Common Stock;

(viii) The basis of the Wintrust Common Stock to be received
by the Company shareholders, including any fractional shares to which
they may be entitled, will be the same as the basis of the Company
Common Stock surrendered in exchange therefor;

(ix) The holding period of the Wintrust Common Stock to be
received by the Company shareholders, including any fractional shares
to which they may be entitled, will include the holding period of the
Company Common Stock surrendered in exchange therefor, provided that
the Company Common Stock was held as a capital asset on the date of
the exchange;

(x) Pursuant to section 381(a) of the Code and section
1.381(a)-1 of the Income Tax Regulations, the Company will succeed to
and take into account the items of the respective Reorganization
Subsidiary described in section 381(c) of the Code, subject to the
provisions and limitations specified in sections 381, 382, 383, 384,
and 1502 of the Code and the regulations thereunder;

(xi) The Company will succeed to and take into account the
earnings and profits, or deficit in earnings and profits, of the
respective Reorganization Subsidiary as of the date of the transfer.
Any deficit in earnings and profits of the Reorganization Subsidiary
will be used only to offset the earnings and profits accumulated after
the date of the transfer;

(xii) Where a shareholder of the Company dissents to the
proposed transaction and receives solely cash in exchange for such
Shareholder's Company Common Stock, such cash will be treated as
having been received by the shareholder as a distribution in
redemption of his or her stock subject to the provisions and
limitations of the Code. Where as a result of such distribution, the
Company shareholder neither holds any stock of Wintrust directly, nor
is deemed to own any such stock under the constructive ownership rules
of the Code, the redemption will be a complete termination of interest
under the Code and will be treated as a distribution in full payment
in exchange for the shares redeemed. Accordingly, such shareholders
will recognize gain or loss under the Code measured by the difference
between the amount of cash received and such Shareholder's adjusted
basis in the Company Common Stock surrendered;

(xiii) The payment of cash in lieu of fractional shares of
Wintrust Common Stock will be treated as if the fractional shares were
distributed as part of the exchange and then redeemed by Wintrust.
These cash payments will be treated as having been received as
distributions in full payment in exchange for stock redeemed as
provided in the Code; and

(xiv) No gain or loss will be recognized by the holders of
non-qualified options to buy shares in the Companies upon the
conversion of those options into non-qualified options to buy shares
of Wintrust Common Stock under the same terms and conditions as in
effect immediately prior to the proposed transaction.

The foregoing describes, in the opinion of Blackman Kallick, the
material federal income tax consequences of the Reorganization for shareholders
or residents of the United States and who hold their shares as capital assets,
without regard to the particular facts and circumstances of the tax situation
of each shareholder of the Companies. It does not discuss all of the
consequences that may be relevant to shareholders of the Companies entitled to
special treatment under the Code (such as insurance companies, financial
institutions, dealers in securities, tax-exempt organizations or foreign
persons). The summary set forth above does not purport to be a complete
analysis of all potential tax effects of the transactions contemplated by the
Reorganization Agreement or the Reorganization itself. No information is
provided herein with respect to the tax consequences, if any, of the
Reorganization under state, local or foreign tax laws.

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ACCOUNTING TREATMENT

Consummation of the Reorganization is conditioned upon qualification
of the Reorganization as a pooling-of-interests for accounting purposes. The
Reorganization Agreement requires that the Companies receive (i) an opinion
from KPMG Peat Marwick LLP ("KPMG") to the effect that the Reorganization
qualifies for "pooling-of-interests" method of accounting and (ii) a favorable
pooling letter from Arthur Andersen, LLP with respect to certain pooling issues
relating to Crabtree. Under the "pooling-of-interests" accounting treatment
the historical basis of the assets and liabilities of the Constituent
Corporations will be combined at the Effective Date and carried forward at
their previously recorded amounts and the shareholders' equity accounts of the
Constituent Corporations will be combined on Wintrust's consolidated balance
sheet. Income and other financial statements of Wintrust issued after
consummation of the Reorganization will be restated retroactively to reflect
the consolidated operations of the Constituent Corporations as if the
Reorganization had taken place prior to the periods covered by such financial
statements.

For the Reorganization to qualify for "pooling-of-interests"
accounting treatment, substantially all of the outstanding Common Stock of each
of the Companies must be exchanged for Wintrust Common Stock and certain other
technical requirements mandated by generally accepted accounting principles
must be satisfied.

EXPENSES

The Reorganization Agreement provides that each of North Shore, Lake
Forest, Hinsdale, Libertyville and Crabtree will equally share the total fees
and expenses incurred in connection with the Reorganization, including but not
limited to, legal fees and disbursements, investment banking and financial
advisory fees relating to the Fairness Opinions, fees relating to the tax
opinion and "pooling" opinions, SEC registration fees and the costs of printing
and mailing this Joint Prospectus/Proxy Statement and conducting special
shareholder meetings, and the costs of preparing and filing requisite
regulatory applications.

TERMINATION, AMENDMENT AND WAIVER

Pursuant to the terms and conditions of the Reorganization Agreement,
the Reorganization Agreement may be terminated at any time prior to the
Effective Date, whether before or after approval by the shareholders of the
Constituent Corporations by: (i) the mutual written consent of all the parties
to the Reorganization Agreement; (ii) any party to the Reorganization Agreement
if (a) the Reorganization has not been effected on or prior to the close of
business on December 31, 1996 (the "Final Reorganization Date"); provided,
however, that the right to terminate the Reorganization Agreement pursuant to
this clause shall not be available to any party whose failure to fulfill any
obligation of the Reorganization Agreement has been the cause of, or resulted
in, the failure of the Reorganization to have been effected on or prior to such
date; or (b) any court of competent jurisdiction has issued an order, decree or
ruling or taken any other action permanently enjoining, restraining or
otherwise prohibiting the transactions contemplated by the Reorganization
Agreement and such order, decree, ruling or other action shall have become
final and non-appealable; (iii) any party to the Reorganization Agreement in
the event that such party's due diligence investigation and review of any of
the other parties as provided for in the Reorganization Agreement discloses
matters which such party in good faith believes to (a) be inconsistent in any
material respect with any of the representations and warranties of any party
contained in the Reorganization Agreement or (b) be of such significance as to
materially and adversely affect the financial condition or the business
prospects of any party and its respective subsidiaries on a consolidated basis,
or (c) deviate materially and adversely from the applicable financial
statements for the year ended December 31, 1995 by giving written notice of
termination to the other parties hereto within seven days after the Review Date
(as defined in the Reorganization Agreement); provided however, that no party
may terminate the Reorganization Agreement pursuant to clause (iii) as a result
of any changes in general economic conditions or matters which affect financial
institutions or premium finance businesses generally; or (iv) any party to the
Reorganization Agreement if any condition precedent cannot be satisfied by the
Final Reorganization Date.

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The Reorganization Agreement may be amended, supplemented or
interpreted at any time before or after approval of the matters presented in
connection with the Reorganization by the shareholders of the Constituent
Corporations, but after any such approval, no amendment may be made which would
have an effect on the Exchange Ratios as approved by such shareholders. At any
time prior to the Effective Date, any party to the Reorganization Agreement
may, to the extent legally allowed, waive any term or condition of the
Reorganization Agreement intended to benefit the waiving party.

INTERESTS OF CERTAIN PERSONS IN THE REORGANIZATION; CONFLICTS OF INTEREST

Certain directors of the Companies (i) presently serve as officers and
directors of more than one of the Companies; (ii) have been designated to serve
as directors and/or officers of Wintrust following the Effective Date; and/or
(iii) are shareholders of more than one of the Companies. For these reasons,
certain directors and officers of the Companies may not be independent and may
be considered to have conflicts of interest with respect to the Reorganization
and Reorganization Agreement. In addition, the Companies have retained common
legal, accounting, tax and financial advisors to represent them with respect to
various matters involved in this transaction. See "TERMS OF THE REORGANIZATION
- -- Material Arrangements Between Companies and Certain Transactions with
Management."

Those persons designated in the Reorganization Agreement to serve as
directors and executive officers of Wintrust are listed in "Management of
Wintrust" and certain information regarding executive compensation is set forth
in "Executive Compensation," both under "WINTRUST FINANCIAL CORPORATION."

Numerous of the directors and officers hold certain rights and options
to acquire Common Stock of certain of the Companies. The Reorganization
Agreement provides that such rights and options will be converted in the
Reorganization on the basis of the applicable Exchange Ratio so as to represent
the right to acquire shares of Wintrust Common Stock at appropriately adjusted
exercise prices.

Howard D. Adams holds certain options relating to shares of Credit
Life, a subsidiary of Crabtree that has discontinued operations. Such options
are to be amended in connection with the Reorganization Agreement so as to
convert to options to acquire Wintrust Common Stock at an exercise price
appropriately adjusted to reflect such conversion. Such options may be more
valuable after the Reorganization since Wintrust will have ongoing operations.
In addition, Howard D. Adams owns 40,000 shares of Crabtree Common Stock which
were purchased at a discount of $20 per share from the market price prevailing
at the time of purchase, pursuant to the Crabtree Capital Corporation 1990
Stock Purchase Plan. The terms of the Crabtree Capital Corporation 1990 Stock
Purchase Plan provide that if such shares are proposed to be sold, then
Crabtree would have the right of first refusal to repurchase the stock, net of
the original discount of $20 per share. The terms of such plan, however, also
provide that Crabtree's right of first refusal terminates effective upon the
effectiveness of a registration statement relating to such shares. The
registration statement, of which this Joint Proxy Statement/Prospectus
constitutes a part, relates to the shares of Wintrust Common Stock into which
the Crabtree shares will convert; therefore, after the Reorganization, Howard
D. Adams will hold the shares of Wintrust Common Stock into which such Crabtree
shares are to be converted with no continuing restrictions or discounts.

Mr. James Knollenberg, the President of First Premium and a director
nominee of Wintrust, holds certain options to purchase shares of First Premium.
The Reorganization Agreement provides that such options shall be converted in
the Reorganization so as to represent options to acquire Wintrust Common Stock
at an exercise price appropriately adjusted to reflect such conversion. The
provision in the Reorganization Agreement is intended to eliminate the
possibility of minority interests in one of Wintrust's operating subsidiaries
from which Wintrust may look to receive dividends. Absent such provision of
the Reorganization Agreement, Mr. Knollenberg would continue to hold an option
to purchase a minority position in a wholly-owned subsidiary of a mid-tier
holding company and for which there is unlikely to develop any established
market for such shares.

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MATERIAL ARRANGEMENTS BETWEEN THE COMPANIES; CERTAIN TRANSACTIONS WITH
MANAGEMENT

Howard D. Adams was a founder and is a principal shareholder and
director of each of the Companies, and Edward J. Wehmer was a founder and is a
principal shareholder and a director of each of the Companies other than
Crabtree. Numerous of the other directors have also participated as organizers
of and serve as a director of more than one of the Companies. See "Management
Ownership of Common Stock" under "NORTH SHORE COMMUNITY BANCORP, INC.," "LAKE
FOREST BANCORP, INC.," "HINSDALE BANCORP, INC.," "LIBERTYVILLE BANCORP, INC.,"
and "CRABTREE CAPITAL CORPORATION" for information relating to interlocking
directorships and such directors' share ownership. Many directors who do not
serve as directors of some or all of the other Companies also own shares in
some or all of the other Companies. In addition, certain of the Companies have
purchased shares in certain of the other Companies, at the price per share
applicable to concurrent public or private offerings by such other Companies,
as follows:

Shares of Shares of Shares of
Hinsdale North Shore Libertyville
Common Stock Common Stock Common Stock
------------ ------------ ------------
Number % Number % Number %
------ --- ------ --- ------ ---

Lake Forest . . . . . . . . . . . . 8,842 4.3% 11,300 4.4% 6,359 3.1%
Hinsdale . . . . . . . . . . . . . -- -- 6,000 2.4 6,359 3.1

North Shore . . . . . . . . . . . . -- -- -- -- 6,360 3.1
Libertyville . . . . . . . . . . . -- -- 6,000 2.4 -- --
----- ---- ------ ----- ------ -----
Total Inter-Company
Ownership . . . . . . . . . 8,842 4.3% 23,300 9.2% 19,078 9.3%
===== ==== ====== ===== ====== =====

The Reorganization Agreement provides that these inter-Company shares will be
cancelled in the Reorganization. See "PRO FORMA CONDENSED COMBINED FINANCIAL
INFORMATION."

Each of North Shore, Lake Forest, Hinsdale and Libertyville currently share
in the salaries of Mr. Howard D. Adams, Mr. Edward J. Wehmer, Mr. David A.
Dykstra, Mr. Robert F. Key, Mr. Lloyd Bowden and Mr. Randolph Hibben who
currently provide services to each of these Companies. See "WINTRUST FINANCIAL
CORPORATION -- Executive Compensation." The Boards of Directors of each of
North Shore, Lake Forest, Hinsdale and Libertyville determined that it was in
the best interests of the entities to share in the costs of retaining these
individuals for their professional services which they could not justify on an
individual entity basis. With the common senior management team, certain cost
savings have occurred as a result of the increased buying power of the combined
group of banks. In particular, the Banks have experienced cost savings and/or
product enhancements for insurance, data processing and certain professional
fees.

In connection with the Reorganization, the Companies entered into an expense
sharing agreement relating to certain professional fees and other costs
associated with the pursuit of the proposed transaction. See "TERMS OF THE
REORGANIZATION -- Expenses."

During 1995, 1994 and 1993, Crabtree's bank debt was guaranteed by Mr.
Howard D. Adams in connection with which Crabtree pays a fee to Mr. Adams at a
rate of 1.5% of the balance of the debt guaranteed. These transactions
resulted in expense to Crabtree and income to Mr. Adams of $32,973, $29,840 and
$68,339 in 1995, 1994 and 1993, respectively. This guarantee arrangement
remains in place during 1996; however, it is anticipated that the arrangement
will be terminated following consummation of the Reorganization.

The Banks have in the past participated, and it is expected they will
continue to participate, with one another on the funding of certain customer
loans and have jointly pursued certain earning asset investments. By pursuing
earning asset niches from the perspective of the combined lending capacity of
the Banks, senior management believes each of the Banks has enjoyed the
enhanced origination of earning assets. Because deposit

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fund generation typically outpaces loan generation in de novo banks, the
origination of loans through such earning asset niches has allowed the Banks to
accelerate the deployment of deposit funds into higher yielding assets than
might otherwise have been achieved.

Each of the Companies shares in expenses incurred by HDA Capital
Corporation, a corporation owned by the Alan W. Adams Family Trust and the
Sarah K. Adams Family Trust, for marketing personnel, secretarial personnel and
direct costs incurred on behalf of the respective Companies. HDA Capital
Corporation provides periodic invoices to each of the Companies for such
marketing and secretarial time and direct expenses based upon specific
activities attributable to each of the respective Companies and based on
estimated actual cost. The Alan W. Adams Family Trust and the Sarah K. Adams
Family Trust are co-trusteed by Emmett McCarthy, a Crabtree director, and
either Alan W. Adams and Sarah K. Adams, respectively, the two adult children
of Howard D. Adams. Alan W. Adams is proposed to be a director of Wintrust.

In addition to the expense sharing arrangement noted above, HDA Capital
Corporation receives consulting fees from Crabtree for services rendered by
Howard D. Adams. Such fees amounted to $142,692 and $111,030 for the years
ended December 31, 1995 and 1994, respectively. It is anticipated that
following consummation of the Reorganization, Mr. Adams will be compensated
directly for his services as an executive officer of Wintrust.

Directors and principal officers of the Companies and the Banks and their
associates were customers of, and have had transactions with the Banks in the
ordinary course of business during 1995 and 1996. Comparable transactions may
be expected to take place in the future. All loans included in such
transactions were made on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for comparable
transactions with other customers, and in the opinion of each Bank's Board of
Directors did not involve more than the normal risk of collectibility or
present other abnormally unfavorable features. Each Bank expects to continue
its banking transactions in the ordinary course of business on the same terms,
including interest rates and collateral on loans, as those prevailing at the
same time for comparable transactions with others.

DISSENTERS' RIGHTS

Hinsdale, Libertyville, and North Shore. Any holder of Hinsdale,
Libertyville or North Shore Common Stock as of the Record Date has the right to
dissent to the approval of the Reorganization pursuant to Section 11.65 of the
BCA and the right to receive the "fair value" of his or her shares of Common
Stock in cash by complying with the procedures set forth in Section 11.70 of
the Illinois Business Corporation Act.

Holders of record of Hinsdale, Libertyville or North Shore common stock who
desire to exercise any dissenters' rights which they may have must satisfy all
of the conditions contained in Sections 11.65 and 11.70 of the IBCA. A written
demand for payment for shares of Hinsdale, Libertyville or North Shore common
stock must be delivered to Hinsdale, Libertyville or North Shore by a
shareholder seeking payment before the taking of the vote on the
Reorganization. This written demand must be separate from any proxy or vote
abstaining from or voting against approval of the Reorganization. Voting
against approval of the Reorganization abstaining from voting or failing to
vote with respect to approval of the Reorganization will not constitute a
demand for payment within the meaning of Sections 11.65 and 11.70.

SHAREHOLDERS ELECTING TO EXERCISE THEIR DISSENTERS' RIGHTS UNDER SECTIONS
11.65 AND 11.70 MUST NOT VOTE FOR APPROVAL OF THE REORGANIZATION. A VOTE BY A
SHAREHOLDER AGAINST APPROVAL OF THE REORGANIZATION IS NOT REQUIRED IN ORDER FOR
THAT SHAREHOLDER TO EXERCISE DISSENTERS' RIGHTS. HOWEVER, IF A SHAREHOLDER
RETURNS A SIGNED PROXY BUT DOES NOT SPECIFY A VOTE AGAINST APPROVAL OF THE
REORGANIZATION OR A DIRECTION TO ABSTAIN, THE PROXY, IF NOT REVOKED, WILL BE
VOTED FOR APPROVAL OF THE REORGANIZATION, WHICH WILL HAVE THE EFFECT OF WAIVING
THAT SHAREHOLDER'S DISSENTERS' RIGHTS.

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A demand for appraisal will be sufficient if it reasonably informs Hinsdale,
Libertyville or North Shore of the identity of the shareholder and that such
shareholder intends thereby to demand payment. If the Hinsdale, Libertyville
or North Shore common stock is owned of record in a fiduciary capacity, such as
by a trustee, guardian, or custodian, such demand must be executed by the
fiduciary. If the Hinsdale, Libertyville or North Shore common stock is owned
of record by more than one person, as in a joint tenancy or tenancy in common,
such demand must be executed by all joint owners. An authorized agent,
including an agent for two or more joint owners, may exercise the demand for
appraisal for a shareholder of record; however, the agent must identify the
record owner or owners and expressly disclose the fact that, in exercising the
demand, he or she is acting as agent for the record owner or owners.

A record owner, such as a broker, who holds Hinsdale, Libertyville or North
Shore common stock as a nominee for others, may exercise his or her right of
appraisal with respect to the shares held for all or less than all beneficial
owners of shares as to which he or she is the record owner. In such case, the
written demand must set forth the number of shares covered by such demand.
Where the number of shares is not expressly stated, the demand will be presumed
to cover all shares of Hinsdale, Libertyville and North Shore common stock
outstanding in the name of such record owner. A beneficial owner of shares who
is not the record owner may assert dissenters' rights as to shares held on such
person's behalf only if the beneficial owner submits to Hinsdale, Libertyville
and North Shore the record owner's written consent to the dissent before or at
the time the beneficial owner asserts dissenters' rights.

If the Reorganization is approved and consummated, the surviving
corporation, Wintrust, shall within ten days of such consummation or 30 days
after the delivery of the shareholder's demand for payment in cash, whichever
is later, send to the dissenting shareholder a written opinion as to its
estimate of the value of the shares and a commitment that it will pay the
estimated value of the shares in cash upon delivery of the stock certificates
by such shareholder to Wintrust. Wintrust must also include with the estimate
and commitment, its consolidated balance sheet as of the end of the most recent
fiscal year, its consolidated statement of income for such year and its latest
available unaudited condensed consolidated interim financial statements.

If the dissenting shareholder does not agree with the opinion of Wintrust as
to the value of his shares, such shareholder, within 30 days from the delivery
of Wintrust's statement of value, shall notify Wintrust of his estimate of
value and shall demand payment for the difference between such estimate of
value and the amount that Wintrust has agreed to pay to the shareholder. If
within 60 days of the delivery of the shareholder's estimate of value to
Wintrust, Wintrust and the dissenting shareholder have not agreed in writing
upon the value of the shares, Wintrust shall either: (i) pay the difference
between the shareholder's estimate of value and any amount previously paid by
Wintrust; or (ii) file a petition in the circuit court of Lake County, Illinois
requesting that the court determine the fair value of the shares. All
dissenting shareholders whose claims remain unsettled at the time of the filing
of the action must be joined as parties thereto and be bound by the judgment of
the Court. The Court may appoint one or more persons to serve as appraisers to
hear evidence and determine the fair value of the shares.

Each dissenting shareholder who is a party to the action will be entitled to
the payment of the fair value of the shares as determined by the Court, plus
interest at a rate deemed fair and reasonable by the Court, from the Effective
Date of the Reorganization until the date of payment. The Court may also
assess court costs, other than attorneys' fees of the parties, against Wintrust
if the fair value as determined by the Court, materially exceeds the amount
which Wintrust initially agreed to pay for the shares.

The provisions of Section 11.65 and 11.70 are technical in nature and
complex. The preceding summary is qualified in its entirety by reference to
Sections 11.65 and 11.70, the complete text of which is attached hereto as
Appendix D. Hinsdale, Libertyville or North Shore shareholders desiring to
exercise dissenters' rights and obtain payment of the fair value of their
Hinsdale, Libertyville and North Shore Common Stock should consult counsel, as
failure to comply strictly with the provisions of Sections 11.65 and 11.70 may
defeat their dissenters' rights.

Lake Forest and Crabtree. Each shareholder of Lake Forest and Crabtree has
the right to demand an appraisal of the fair value of his shares of stock by
the Delaware Court of Chancery and to receive the appraised

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value of such shares in cash if the shareholder follows the procedures set
forth under Delaware law and summarized below.

Under Section 262 of the Delaware General Corporation Law, a Lake Forest or
Crabtree shareholder seeking to exercise his appraisal rights must: (i) deliver
to Lake Forest or Crabtree, as the case may be, prior to the vote on the
Reorganization a written demand for appraisal of his shares of stock; and (ii)
not vote in favor of the Reorganization at the Special Meeting. By failing to
file a demand for appraisal or by voting in favor of the Reorganization a
shareholder will be deemed to be not entitled to appraisal rights. A
shareholder who perfects his appraisal rights by delivering a demand for
appraisal prior to the vote and by not voting in favor of the Reorganization
may withdraw his demand for appraisal and accept the terms of the
Reorganization for a period of 60 days after the Effective Date of the
Reorganization.

If the Reorganization is approved and consummated, within ten days after the
Effective Date, Wintrust, as the surviving corporation, will notify each Lake
Forest or Crabtree shareholder who has perfected his appraisal rights of the
date upon which the Reorganization was consummated. Within 120 days of the
Effective Date, each shareholder who has perfected his appraisal rights is
entitled, upon such shareholder's written request to Wintrust, to receive from
Wintrust a statement setting forth the aggregate number of shares of stock
owned by all Lake Forest or Crabtree shareholders who have perfected their
appraisal rights. Such written statement must be mailed by Wintrust within ten
days after receipt of a shareholder's written request.

Within 120 days after the Effective Date of the Reorganization, Wintrust or
any shareholder who has perfected his appraisal rights may file a petition in
the Court of Chancery demanding a determination of the value of the stock of
all shareholders of Lake Forest or Crabtree who have perfected their appraisal
rights. If the petition is filed by a shareholder, Wintrust will be served
with a copy of such petition and must, within 20 days of such service, file in
the office of the Register in Chancery where the petition was filed a duly
verified list of the names and addresses of the shareholders who have demanded
payment for the value of their shares of stock and with whom Wintrust has not
reached agreement as to such value. If the petition is filed by Wintrust, such
duly verified list of shareholders must accompany the filing. If ordered by
the Court, the Register of Chancery shall give notice, by certified or
registered mail, of the time and place fixed for a hearing on the petition to
Wintrust and to each shareholder on the list of shareholders. The notice of
time and place of hearing will also be published in one or more newspapers of
general circulation at least one week prior to the hearing.

At the hearing on such petition, the Court shall first determine which of
the shareholders of Lake Forest or Crabtree have complied fully with the
appraisal rights provisions of the DGCL and have become entitled to appraisal
rights. The Court may also require all shareholders who demand appraisal to
present their stock certificates to the Register of Chancery for the placement
of a notation thereon as to the pendency of the appraisal proceeding. After
determination of the shareholders entitled to an appraisal, the Court will
appraise the fair value of the shares, exclusive of any element of value
arising from the accomplishment or expectation of the Reorganization. The
Court may also determine a fair rate of interest to be paid on the fair value
of the shares, considering, among other factors, the rate of interest which
Wintrust would have paid on borrowed money during the pendency of the appraisal
proceedings.

After appraisal of the fair value of the shares, the Court will direct
Wintrust to pay such amount, with interest if any, to the shareholders entitled
to such payment. Payment will be made only upon the surrender of stock
certificates evidencing shares of stock by the shareholder to Wintrust. The
cost of the appraisal proceedings will be determined by the Court and such cost
will be allocated to the parties in a manner deemed to be equitable by the
Court. Also, upon application of a shareholder, the Court may order all or a
portion of the expenses incurred by the shareholders in connection with the
appraisal proceedings, including reasonable attorney's fees and the fees and
expenses of experts, to be charged pro rata against the value of all shares
subject to appraisal.

The provisions of Section 262 are technical in nature and complex. The
preceding summary is qualified in its entirety by reference to Section 262, the
complete text of which is attached hereto as Appendix E. Lake Forest or
Crabtree shareholders desiring to exercise dissenters' rights and obtain
payment of the fair value of their

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Lake Forest or Crabtree common stock should consult counsel, as failure to
comply strictly with the provisions of Section 262 may defeat their dissenters'
rights.

RESALE OF WINTRUST COMMON STOCK

Shares of Wintrust Common Stock issued to shareholders of Wintrust will be
transferable without restriction upon disposition, except shares issued to any
person who may be considered an "affiliate" of one or more of the Companies, as
defined by the rules and regulations of the Commission under the Securities
Act. In general, those persons who are directors or officers and certain 10%
or greater shareholders, of a company are deemed to be an "affiliate" for these
purposes. Pursuant to the Reorganization Agreement, each of the Companies has
delivered to Wintrust a written undertaking from each affiliate of such Company
to the effect that (a) he or she will not sell or dispose of the Wintrust
Common Stock, acquired by him or her in connection with the Reorganization,
other than in accordance with the Securities Act and pursuant to (i) a separate
registration statement for such distribution (which Wintrust has not agreed to
provide), or (ii) in accordance with all applicable provisions of Rule 145
promulgated thereunder by the Commission including the manner-of-sale
requirements and the volume limitations, or (iii) pursuant to some other
exemption from registration; and (b) he or she will not dispose of the Wintrust
Common Stock or otherwise reduce his or her risk relative to the Wintrust
Common Stock prior to the publication by Wintrust of an earnings statement
covering at least 30 days of combined operations after the Effective Date. It
is anticipated that the latter requirements would be satisfied during November
1996.

The availability of the Rule 145 resale exemption is conditioned upon
Wintrust making timely filings of all periodic reports required to be filed
under the Securities Exchange Act of 1934. The provisions of Rule 145 will
generally restrict, for a period of two years following the Effective Date, the
ability of any "affiliate" of any of the Companies to sell an amount of shares
of Wintrust Common Stock in excess of certain prescribed volume limitations.
During any three-month period, an affiliate is permitted to sell up to an
amount equal to the greater of 1% of the total shares outstanding at the time
of sale or the average weekly trading volume for the prior four-week period (if
a trading market does develop) of the Wintrust Common Stock. In addition, such
sales must be made in unsolicited "brokers' transactions" through a
broker-dealer, and the affiliate must file a notice of sale on a form
prescribed by the SEC.

Shareholders of the Companies who become "affiliates" of Wintrust will be
subject to similar sale restrictions for as long as they remain "affiliates" of
Wintrust. Generally, in the absence of other factors indicating a control
relationship, persons who are not officers, directors or greater than 10%
shareholders of the Companies prior to the Reorganization and are not officers,
directors or greater than 10% shareholders of Wintrust after the Reorganization
will not be considered "affiliates" of Wintrust and will not be subject to
resale restrictions after two years have elapsed from the Effective Date of the
Reorganization.

DESCRIPTION OF CAPITAL STOCK OF WINTRUST

GENERAL

Wintrust is authorized to issue 30,000,000 shares, without par value, of
common stock (the "Common Stock") and 20,000,000 shares, without par value, of
preferred stock (the "Preferred Stock"). There are currently shares of Common
Stock outstanding. Wintrust currently expects to issue approximately 6,428,255
shares of Common Stock and no shares of Preferred Stock in the Reorganization,
with approximately 1,224,064 additional shares of Common Stock to be reserved
for issuance upon the exercise of currently outstanding options, rights and
warrants. See "Exchange Ratios," "Common Stock Warrants" and "Options/Rights"
under "TERMS OF THE REORGANIZATION." Each share of Wintrust Common Stock will
have the same relative rights as, and will be identical in all respects with,
each other share of Common Stock. Upon consummation of the Reorganization all
such stock will be duly authorized, fully paid and nonassessable.

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COMMON STOCK

Dividends. Wintrust may pay dividends if, as and when declared by its Board
of Directors. The payment of dividends by Wintrust is subject to limitations
which are imposed by the IBCA. The holders of Wintrust Common Stock will be
entitled to receive and share equally in such dividends as may be declared by
the Board of Directors of Wintrust out of funds legally available therefor. If
Wintrust issues Preferred Stock, the holders thereof may have a priority over
the holders of the Common Stock with respect to dividends.

Voting Rights. Upon the Reorganization, the holders of Common Stock of
Wintrust will possess voting rights in Wintrust. They will elect Wintrust's
Board of Directors and act on such other matters as are required to be
presented to them under Illinois law or as are otherwise presented to them by
the Board of Directors. Each holder of Common Stock will be entitled to one
vote per share and will not have any right to cumulate votes in the election of
directors. If Wintrust issues Preferred Stock, holders of the Preferred Stock
may also possess voting rights to the extent designated by the Board of
Directors of Wintrust.

Liquidation. In the event of any liquidation, dissolution or winding up of
Wintrust, the holders of its Common Stock would be entitled to receive, after
payment or provision for payment of all debts and liabilities of Wintrust, all
assets of Wintrust available for distribution. If Preferred Stock is issued,
the holders thereof may have a priority over the holders of the Common Stock in
the event of any liquidation or dissolution.

Preemptive Rights and Redemption. Holders of the Common Stock of Wintrust
will not be entitled to preemptive rights with respect to any shares which may
be issued in the future by Wintrust. The Common Stock is not subject to
redemption by Wintrust.

PREFERRED STOCK

None of the shares of Wintrust's authorized Preferred Stock will be issued
in the Reorganization. The Preferred Stock authorized may be issued at such
time as the Board of Directors of Wintrust may determine, without further
shareholder action, except as otherwise provided by law. Shareholders will not
have preemptive rights to subscribe for shares of Preferred Stock.

The dividend rights, dividend rates, conversion rights, conversion prices,
voting rights, redemption rights and terms (including sinking fund provisions,
if any), the redemption price or prices and the liquidation preferences of any
series of the authorized Preferred Stock and the numbers of such shares of
Preferred Stock in each series will be established by the Board of Directors of
Wintrust as such shares are to be issued. It is not possible to state the
actual effect of the Preferred Stock on the rights of holders of Common Stock
until the Board of Directors of Wintrust determines the rights of the holders
of a series of the Preferred Stock. However, such effects might include (i)
restrictions on dividends; (ii) dilution of the voting power to the extent that
the Preferred Stock were given voting rights; (iii) dilution of the equity
interest and voting power if the Preferred Stock were convertible into Common
Stock; and (iv) restrictions upon any distribution of assets to the holders of
Common Stock upon liquidation or dissolution until the satisfaction of any
liquidation preference granted to holders of the Preferred Stock.

Furthermore, although it has no present intention to do so, Wintrust's Board
of Directors could cause Wintrust to issue, in one or more transactions, shares
of Preferred Stock or additional shares of Common Stock or rights to purchase
such shares (subject to the limits imposed by applicable laws and the rules of
any stock exchange or automated dealer quotation system to the extent that such
rules may become applicable or may be observed by Wintrust) in amounts which
could make more difficult and, therefore, less likely, a takeover, proxy
contest, change in management of Wintrust or any other extraordinary corporate
transaction which might be opposed by the incumbent Board of Directors. Any
issuance of Preferred Stock or of Common Stock could have the effect of
diluting the earnings per share, book value per share and voting power of
Common Stock held by Wintrust shareholders.

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CERTAIN ANTI-TAKEOVER EFFECTS OF WINTRUST'S ARTICLES AND BY-LAWS AND ILLINOIS
LAW

General. Certain provisions of Wintrust's Articles, By-Laws and the IBCA
may have the effect of impeding the acquisition of control of Wintrust by means
of a tender offer, a proxy fight, open-market purchases or otherwise in a
transaction not approved by the Board of Directors of Wintrust.

These provisions may have the effect of discouraging a future takeover
attempt which is not approved by the Board of Directors but which individual
Wintrust shareholders may deem to be in their best interests or in which
Wintrust shareholders may receive a substantial premium for their shares over
then current market prices. As a result, shareholders who might desire to
participate in such a transaction may not have an opportunity to do so. Such
provisions will also render the removal of the current Board of Directors or
management of Wintrust more difficult.

The provisions of the Articles and By-Laws described below are designed to
reduce, or have the effect of reducing, the vulnerability of Wintrust to an
unsolicited proposal for the restructuring or sale of all or substantially all
of the assets of Wintrust or an unsolicited takeover attempt which is unfair to
Wintrust shareholders.

It is anticipated that the Board of Directors of Wintrust will consider and
may implement a shareholder rights plan subsequent to the consummation of the
Reorganization to deter coercive, hostile bids for corporate control and
encourage a potential acquiror to negotiate with the Board of Directors. If a
rights plan is implemented, each share of Wintrust Common Stock would include
an associated preferred or common share purchase right. The purchase right
would entitle the holder to purchase shares of Wintrust Common Stock at a price
and under such other terms and conditions as set forth in the rights plan. A
rights plan, if implemented, will have certain anti-takeover effects in
addition to those measures described below.

The following description of certain of the provisions of the Articles and
By-Laws of Wintrust is necessarily general and is qualified in its entirety by
reference to the Articles and By-Laws of Wintrust and the IBCA.

Although no specific proposals have yet been made, the Board of Directors of
Wintrust expressly reserves the right to introduce in the future additional
measures, including the rights plan, which might have an anti-takeover effect.

Authorized Shares. The Articles of Wintrust authorize the issuance of
30,000,000 shares of Common Stock and 20,000,000 shares of Preferred Stock.
The shares of Common Stock and Preferred Stock were authorized in an amount
greater than that to be issued in the Reorganization to provide Wintrust's
Board of Directors with as much flexibility as possible to effect, among other
transactions, financings, acquisitions, stock dividends, stock splits, employee
stock options and a rights plan. However, these additional authorized shares
may also be used by the Board of Directors consistent with its fiduciary duty
to deter future attempts to gain control of Wintrust. The Board of Directors
also has sole authority to determine the terms of any one or more series of
Preferred Stock, including voting rights, conversion rates, and liquidation
preferences. As a result of the ability to fix voting rights for a series of
Preferred Stock, the Board has the power to the extent consistent with its
fiduciary duty to issue a series of Preferred Stock to persons friendly to
management in order to attempt to block a merger or other transaction by which
a third party seeks control, and thereby assist the incumbent Board of
Directors and management to retain their respective positions. Wintrust's
Board of Directors currently has no plans for the issuance of additional
shares.

Classified Board of Directors, Filling of Board Vacancies. The Board of
Directors of Wintrust is divided into three classes, each of which contains
approximately one-third of the whole number of the members of the Board. Each
class serves a staggered term, with approximately one-third of the total number
of directors being elected each year. The Articles and By-Laws provide that
the size of the Board of Directors is determined by a majority of the
directors. The Articles and By-Laws provide that any vacancy occurring in the
Board, including a vacancy created by an increase in the number of directors or
resulting from death, resignation, retirement, disqualification, removal from
office or other cause, shall be filled for the remainder of the unexpired term

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exclusively by a majority vote of the directors then in office. The staggered
board is intended to provide for continuity of the Board of Directors and to
make it more difficult and time consuming for a shareholder group to fully use
its voting power to gain control of the Board of Directors without the consent
of the incumbent Board of Directors of Wintrust.

Cumulative Voting; Action by Written Consent and Shareholder Meetings. The
Articles do not provide for cumulative voting for any purpose. The Articles
and By-Laws also provide that any action required or permitted to be taken by
the shareholders of Wintrust may be taken only at an annual or special meeting
and prohibits shareholder action by written consent in lieu of a meeting.
Directors also retain the right to postpone any previously scheduled
shareholder meeting and adjourn any shareholder meeting at any time, whether or
not a quorum is present.

Shareholder Vote Required to Approve Business Combinations with Principal
Shareholders. Wintrust's Articles expressly elect to be governed by the
provisions of Section 7.85 of the IBCA which applies to a transaction with an
"Interested Shareholder" (as defined below) (the "IBCA fair price provision").
Under Illinois law, absent this provision, business combinations, including
mergers, consolidations and sales of substantially all of the assets of a
corporation must, subject to certain exceptions, be approved by the vote of the
holders of only a majority of the outstanding shares of common stock of the
corporation and any other affected class of stock. Under the IBCA fair price
provision and the Articles of Wintrust, the approval of at least 80% of the
shares is required in connection with any transaction involving an Interested
Shareholder except (i) in cases where the proposed transaction has been
approved in advance by a majority of those members of Wintrust's Board of
Directors who are unaffiliated with the Interested Shareholder and were
directors prior to the time when the Interested Shareholder became an
Interested Shareholder or (ii) if the proposed transaction met certain
conditions set forth therein which are designed to afford the shareholders of
Wintrust a fair price in consideration for their shares, in which case approval
of only a majority of the outstanding shares of voting stock is required.

The term "Interested Shareholder" is defined to include any individual,
corporation, partnership or other entity (other than Wintrust or any
Subsidiary) which owns beneficially or controls, directly or indirectly, 10% or
more of the outstanding shares of voting stock of Wintrust. This provision of
the Articles of Wintrust applies to any "Business Combination," which is
defined to include (i) any merger or consolidation of Wintrust or any of its
subsidiaries with or into any Interested Shareholder or Affiliate or Associate
(as defined in the Articles) of an Interested Shareholder; (ii) any sale,
lease, exchange, mortgage, transfer, or other disposition to or with any
Interested Shareholder or Affiliate or Associate of 10% or more of the assets
of Wintrust on a consolidated basis; (iii) the issuance or transfer to any
Interested Shareholder or its Affiliate or Associate by Wintrust (or any
Subsidiary) of any securities of Wintrust in exchange for any assets, cash or
securities the value of which equals or exceeds 10% of the consolidated assets
of Wintrust; (iv) the adoption of any plan for the liquidation or dissolution
of Wintrust proposed by or on behalf of any Interested Shareholder or Affiliate
or Associate thereof; and (v) any reclassification of securities,
recapitalization, merger or consolidation of Wintrust which has the effect of
increasing the proportionate share of Common Stock or any class of equity or
convertible securities of Wintrust owned directly or indirectly, by an
Interested Shareholder or Affiliate or Associate thereof.

In a Business Combination involving cash or other consideration being paid
to Wintrust's shareholders, the consideration would be required to be either
cash or the same type of consideration used by the Interested Shareholder in
acquiring the largest portion of shares previously acquired by it. In the case
of payments to holders of Common Stock, the per share fair market value of such
payments generally would have to be at least equal in value to the higher of
(i) the highest per-share price paid (including any brokerage commissions,
transfer taxes and soliciting dealers' fees) by the Interested Shareholder in
acquiring any Wintrust Common Stock during the two-year period prior to the
first public announcement of the proposed Business Combination (although not an
Interested Shareholder at the time of any such acquisitions) or in the
transaction in which it became an Interested Shareholder (whichever is higher);
or (ii) the fair market value of Wintrust shares on the first trading date
after the date of such announcement date or on the first trading date after the
date on which the Interested Shareholder became an Interested Shareholder,
(whichever is higher); in any case appropriately adjusted for any stock
dividend, stock split, combination of shares or similar event.

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In a Business Combination involving cash or other consideration being paid
to the holders of Wintrust shares other than Wintrust Common Stock, the
consideration would have to be at least equal in value to the higher of (i) the
highest per-share price (including any brokerage commissions, transfer taxes
and soliciting dealers' fees) paid by the Interested Shareholder in acquiring
any Wintrust Common Stock during the two-year period prior to the first public
announcement of the proposed business combination (although not an Interested
Shareholder at the time of any such acquisitions) or in the transaction in
which it became an Interested Shareholder (whichever is higher); or (ii) the
highest per-share amount to which the holders of shares are entitled in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
Wintrust; or (iii) the fair market value of Wintrust shares on the first
trading date after such announcement date or the date on which the Interested
Shareholder became an Interested Shareholder (whichever is higher); and (iv)
the price per-share equal to the fair market value per-share determined in
(iii) above, multiplied by the ratio of (x) the highest per-share price paid by
the Interested Shareholder in acquiring any Wintrust Common Stock during the
two-year period prior to such announcement date (although not an Interested
Shareholder at the time of any such acquisitions) to (y) the fair market value
per-share on the first day in such two-year period upon which the Interested
Shareholder acquired any shares; in any case appropriately adjusted for any
stock dividend, stock split, combination of shares or similar event.

Fair price provisions are designed to impede two-step takeover transactions
which might otherwise result in disparate treatment of Wintrust's shareholders.

Amendment of the Articles and By-Laws. Amendment of the Articles must be
approved by a majority vote of the Board of Directors and also by a 2/3 vote
of the outstanding shares of Wintrust Common Stock, provided, however, that an
affirmative vote of at least 85% of the outstanding voting stock entitled to
vote is required to amend or repeal certain provisions of the Articles,
including provisions (i) limiting voting rights, (ii) relating to certain
business combinations, (iii) limiting the shareholders ability to act by
written consent, (iv) regarding the number, classification of directors,
filling of Board vacancies, newly created directorships, indemnification of
directors and officers by Wintrust and limitation of liability for directors,
(v) regarding shareholder proposals and director nominations and (vi) regarding
amendment of the foregoing super majority provisions of Wintrust's Articles.
Wintrust's By-Laws may be amended only by the Board of Directors.

Certain By-Laws Provisions. The By-Laws of Wintrust also require a
shareholder who intends to nominate a candidate for election to the Board of
Directors, or to raise new business at a shareholder meeting to provide advance
notice to the Secretary of Wintrust. The notice provision requires a
shareholder who desires to raise new business to provide certain information to
Wintrust concerning the nature of the new business, the shareholder and the
shareholder's interest in the business matter. Similarly, a shareholder
wishing to nominate any person for election as a director must provide Wintrust
with certain information concerning the nominee and the proposing shareholder.

The provisions described above are intended to reduce Wintrust's
vulnerability to takeover attempts and certain other transactions which have
not been negotiated with and approved by members of its Board of Directors.

Attempts to take over corporations have recently become increasingly common.
An unsolicited non-negotiated proposal can seriously disrupt the business and
management of a corporation and cause it great expense. Accordingly, the Board
of Directors of each of the Companies believes it is in the best interests of
Wintrust and its shareholders to encourage potential acquirors to negotiate
directly with management and that these provisions will encourage such
negotiations and discourage non-negotiated takeover attempts. It is also the
view of each of the Boards of Directors that these provisions should not
discourage persons from proposing a merger or other transaction at a price that
reflects the true value of Wintrust and that otherwise is in the best interest
of all shareholders.

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COMPARATIVE RIGHTS OF SHAREHOLDERS OF WINTRUST
AND THE COMPANIES

Upon consummation of the Reorganization, the shareholders of each of the
Companies who receive Wintrust Common Stock will become shareholders of
Wintrust and their rights will be governed by the Articles and the By-Laws of
Wintrust which differ in certain material respects from the corporate governing
documents of each of the Companies. In addition, as shareholders of Wintrust,
the rights of each of the former Company shareholders will be governed by the
IBCA under which Wintrust was incorporated, rather than the respective state of
incorporation under which each Company was incorporated.

In some respects the rights of holders of Company common stock are similar
to those of Wintrust Common Stock. For example, the holders of the Company
common stock and Wintrust Common Stock do not have cumulative voting rights.
There are, however, differences between the IBCA and the DGCL and between the
Articles of Incorporation or Certificate of Incorporation (collectively, the
"Charters"), as the case may be, and by-laws of the Companies, and Wintrust's
Articles and By-Laws. Although it is impractical to compare all aspects of
those differences, the following discussion summarizes certain significant
aspects of the principal differences.

The following comparison of the corporate governance documents of each of
the Companies and Wintrust is not intended to be complete and is qualified in
its entirety by reference to the relevant provisions of the DGCL and the IBCA,
each of the Company's Charter and by-laws and Wintrust's Articles and By-Laws.
Copies of each Company's Charter and By-laws are available for inspection at
the offices of each Company and copies will be sent to the Constituent
Corporations' shareholders upon request. Copies of Wintrust's Articles and
By-Laws are attached hereto as Exhibit B and Exhibit C, respectively, to
Appendix A to this Joint Proxy Statement/Prospectus. See also "DESCRIPTION OF
CAPITAL STOCK OF WINTRUST."

AUTHORIZED CAPITAL STOCK

North Shore's authorized capital stock currently consists of 400,000 common
shares, without par value; Hinsdale's authorized capital stock currently
consists of 350,000 common shares, par value $1.00 per share; Lake Forest's
authorized capital stock currently consists of 200,000 common shares, par value
$1.00 per share, and 7,500 preferred shares, par value $2.00 per share;
Libertyville's authorized capital stock currently consists of 350,000 common
shares, without par value, and 25,000 preferred shares, without par value; and
Crabtree's authorized capital stock currently consists of 2,000,000 common
shares, par value $1.00 per share. The holders of the shares of the
Constituent Corporations' common stock are entitled to one vote for each share
held of record on all matters to be voted on by shareholders. There is no
cumulative voting with respect to the election of directors. Prior to or on
the Effective Date, all of the preferred stock of the Companies that is issued
and outstanding as of this date will be redeemed and it is expected that no
additional shares shall be issued prior to the Reorganization.

Wintrust's Articles authorize the issuance of 30,000,000 shares of Wintrust
Common Stock. As of [June _, 1996], shares of Wintrust Common Stock are
authorized but unissued. The holders of Wintrust Common Stock are entitled to
one vote for each share held of record on all matters to be voted on by
shareholders. There is no cumulative voting with respect to the election of
directors. Holders of Wintrust Common Stock have no conversion, preemptive or
other subscription rights, and, there are no redemption provisions applicable
to Wintrust Common Stock. In the event of liquidation, dissolution or winding
up of Wintrust, the Wintrust Common Stock is entitled to share ratably in all
assets remaining available for distribution to them after payment of
liabilities. The holders of Wintrust Common Stock are entitled to receive
dividends when, as and if declared by the Board of Directors out of funds
legally available therefor, subject to the prior rights of holders of any
outstanding Preferred Stock.

Wintrust's Articles also authorize the issuance of 20,000,000 shares of
Preferred Stock. The Board of Directors, without the need for shareholder
approval, is authorized by the Articles to issued the Preferred Stock in one or
more series, from time to time, with such voting powers, full or limited, and
with such designations, rights and preferences as may be determined by the
Board of Directors. As of the date hereof, all Wintrust's Preferred Stock is
authorized but unissued. There are no plans for the issuance of any such
shares at the present. The

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issuance of shares of the Preferred Stock would affect the relative rights of
Wintrust Common Stock, depending upon the exact terms, qualifications,
limitations and relative rights and preferences, if any, of the shares of the
Preferred Stock as determined by the Board of Directors.

SIZE AND CLASSIFICATION OF THE BOARD OF DIRECTORS

Currently, the directors of each Company are elected annually by the
shareholders to serve until the next annual meeting or until their successors
are elected and qualified. With the exception of Lake Forest and Crabtree, any
vacancies occurring on the Boards of Directors of the Companies may be filled
by the shareholders of the respective Company. Any vacancies occurring on the
Lake Forest and Crabtree Boards are filled by a majority of the directors then
in office.

Under Wintrust's Articles and By-Laws, the size of the Board of Directors
may be increased or decreased by the Board of Directors provided that in no
event shall the number be less than six (6) members. The initial number of
directors is 21. In addition, the Board of Directors is divided into three (3)
classes of directors as nearly equal in size as possible and the directors are
elected to serve staggered three-year terms so that the term of office of one
class of directors will expire each year. Vacancies which occur on the Board
may be filled by the Board of Directors and directors elected to fill a vacancy
will hold office for the remainder of the term of the class to which they have
been elected. If the number of directors is modified, any increase in
directorships would be apportioned among the classes so as to make all classes
as nearly equal in number as possible.

The staggered election of directors ensures that at any given time,
approximately two-thirds of the directors serving will have had prior
experience on the Board. Staggered terms for directors also would moderate the
pace of any change in the Board by extending the time required to elect a
majority of directors from one to two years. It would be impossible, assuming
no resignations or removals of directors, for the shareholders to change a
majority of the directors at any annual meeting should they consider such a
change desirable, unless Article Ten of Wintrust's Articles are amended by
action of at least 85 percent of the voting shares of Wintrust.

NOMINATIONS FOR DIRECTORS

Under the Charters of the Companies there are no specific procedures for the
nomination for the election of directors by shareholders, therefore directors
can be nominated from the floor at the annual meeting of the shareholders.

Wintrust's By-Laws provide that nominations for the election of directors
may be made by the Board of Directors or by any shareholder entitled to vote
for the election of directors, subject to the nomination having been made in
compliance with certain notice and informational requirements.

In light of these requirements, a shareholder may be deterred from
nominating an individual for election as a director. This provision is
designed to prevent nominations from the floor at the annual meeting without
advance notice and requires that sufficient information be provided regarding
each nominee. The Board of Directors believes that such disclosure is
beneficial and the elimination of the element of surprise will allow a more
reasonable consideration of the qualifications of all nominees.

ACTION BY WRITTEN CONSENT

Under the IBCA, DGCL and the Charters and by-laws of the Companies, whenever
shareholders are required or permitted to take any action by vote, such action
may be taken without a meeting on written consent setting forth the action so
taken signed by the holders of all shares. Wintrust's Articles and By-Laws
prohibit shareholder action by written consent. The purpose of this limitation
is to require that all proposals be addressed at the regularly scheduled
meetings of shareholders, thereby creating sufficient opportunity to
disseminate information to all shareholders resulting in a more reasonable
consideration of matters by the shareholders.

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MEETINGS OF SHAREHOLDERS

Under the IBCA, Wintrust shareholders holding not less than one-fifth of the
outstanding shares may call a special meeting of shareholders. A quorum for a
meeting of the shareholders of Wintrust generally is a majority of the
outstanding shares entitled to vote for the transaction of any business.
Except as described below under the subheadings "Shareholder Vote Required to
Approve Business Combinations with Principal Shareholders" and "Amendment of
the Articles and By-Laws" a majority of the quorum is generally required for
the transaction of any general business. Extraordinary matters such as a
merger, consolidation, share exchange or sale of substantially all of the
assets of the corporation requires the affirmative vote of 2/3 of the shares
of the corporation. The IBCA provides that the articles of incorporation of an
Illinois corporation may require any number or percentage greater than a
majority to constitute a quorum. In contrast, the DGCL requires only the
approval of a majority of the outstanding shares to approve extraordinary
matters.

Wintrust's Articles and By-Laws permit the Board of Directors of Wintrust to
postpone any previously scheduled meeting and adjourn any shareholder meeting
at any time, whether or not a quorum is present. The Charters and By-laws of
the Companies do not give this power to their respective Boards of Directors.
The Board of Directors of Wintrust believes such a provision is necessary to
ensure that shareholders are not asked to act on matters without being fully
informed.

SHAREHOLDER PROPOSALS

Under the Charters of the Companies there are no specific procedures for the
consideration of shareholder proposals, therefore proposals can be introduced
from the floor at an annual or special meeting of the shareholders.

Wintrust's By-Laws establish procedures that must be followed for a
shareholder to submit a proposal for consideration at a meeting of the
shareholders. No proposal for a shareholder vote may be submitted to the
shareholders by a shareholder unless such submitting shareholder has timely
filed with the Secretary of Wintrust a written statement setting forth
specified information, including the name and address of the shareholder making
the proposal, the class and number of shares of capital stock of Wintrust
beneficially owned by such shareholder, a brief description of the proposal and
the reasons for bringing such business before the annual meeting and any
material interest of the shareholder in such business. If the presiding
officer at any shareholders' meeting determines that any such proposal was not
made in accordance with these procedures or is otherwise not in accordance with
the law, such presiding officer may refuse to permit the matter to come before
the meeting.

In light of these requirements, a shareholder may be deterred from bringing
a matter before the shareholders. This provision is designed to prevent the
introduction of matters from the floor at a meeting without advance notice and
sufficient information. The Board of Directors believes that such disclosure
is beneficial and the elimination of the element of surprise will allow a more
reasonable consideration of the merits of the matter.

INDEMNIFICATION OF OFFICERS AND DIRECTORS

The indemnification of officers and directors of a corporation under the
IBCA, DGCL and the Charters and by-laws of the Companies is substantially
similar to the indemnification provided by the Articles and By-Laws of
Wintrust.

The Articles and By-Laws provide that Wintrust may indemnify its officers
and directors to the fullest extent provided by the IBCA. The IBCA authorizes
an Illinois corporation to indemnify any person made, or threatened to be made,
a party in any civil or criminal proceeding (other than an action by or in the
right of the corporation to procure a judgment in its favor) by reason of the
fact that such person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another entity, against judgments,
fines, amounts paid in settlement and reasonable expenses (including attorneys'
fees actually and reasonably incurred by such person as a result of such action
or proceeding or any appeal therein). With respect to actions by or in the
rights of the corporation, the IBCA authorizes

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indemnification of such person against reasonable expenses, including attorneys
fees, and amounts paid in settlement. To be entitled to indemnification, a
person must have acted in good faith and in a manner the person reasonably
believed to be in, or not opposed to, the best interests of the corporation,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. Court approval is required as a
prerequisite to indemnification of expenses in respect of any claim as to which
a person has been adjudged liable to the corporation. The IBCA requires
indemnification against expenses actually and reasonably incurred by any
director, officer, employee or agent in connection with a proceeding against
such person for action in such capacity to the extent that the person has been
successful on the merits or otherwise. Advancement of expense (i.e., payment
prior to a determination on the merits) is permitted, but not required, by the
IBCA, which further requires that any director or officer must undertake to
repay such expenses if it is ultimately determined that such officer or
director is not entitled to indemnification. The disinterested members of the
board of directors (or independent legal counsel or the shareholders) must
determine, in each instance where indemnification is not required by the IBCA,
that such director, officer, employee or agent is entitled to indemnification.
The IBCA provides that the indemnification provided by statute is not
exclusive.

Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the registrant
pursuant to the foregoing provisions, Wintrust has been informed that in the
opinion of the Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.

LIMITATION ON DIRECTORS' LIABILITY

Under the IBCA and DGCL, a corporation may limit or eliminate the personal
liability of directors to the corporation or its shareholders for monetary
damages for breach of fiduciary duty in such capacity. This limitation on
liability is not available for (i) a breach of the director's duty of loyalty
to the corporation or its shareholders; (ii) acts or omissions not in good
faith or involving intentional misconduct or a knowing violation of law; (iii)
any transaction in which the director derived an improper personal benefit; or
(iv) resulted in a violation of Section 8.65 of the IBCA, or Section 174 of the
DGCL, as the case may be, which, among other things, prohibit certain dividend
declarations, stock repurchases and redemptions.

Of the Companies, only the corporate governance documents of each of Lake
Forest and Crabtree provide for the limitation of liability for directors.
Wintrust's Articles provide for the limitation on directors' liability as
permitted by these statutes. In recent years, directors of corporations have
faced increasing personal liability for corporate decisions and significant and
increasing expenses in defending their actions. At the same time, liability
insurance for directors is costly. Such a provision is necessary if Wintrust
is to remain competitive for the services of the most highly qualified persons
and keep Wintrust's insurance costs manageable.

SHAREHOLDER VOTE REQUIRED TO APPROVE BUSINESS COMBINATIONS WITH PRINCIPAL
SHAREHOLDERS

Wintrust's Articles expressly elect to be governed by the provisions of
Section 7.85 of the IBCA which applies to a transaction with an "Interested
Shareholder" (as defined below) (the "IBCA fair price provision"). Under
Illinois law, absent this provision, business combinations, including mergers,
consolidations and sales of substantially all of the assets of a corporation
must, subject to certain exceptions, be approved by the vote of the holders of
only a majority of the outstanding shares of common stock of the corporation
and any other affected class of stock. Under the IBCA fair price provision and
the Articles of Wintrust, the approval of at least 80% of the shares is
required in connection with any transaction involving an Interested Shareholder
except (i) in cases where the proposed transaction has been approved in advance
by a majority of those members of Wintrust's Board of Directors who are
unaffiliated with the Interested Shareholder and were directors prior to the
time when the Interested Shareholder became an Interested Shareholder or (ii)
if the proposed transaction met certain conditions set forth therein which are
designed to afford the shareholders of Wintrust a fair price in consideration
for their shares, in which case approval of only a majority of the outstanding
shares of voting stock is required.

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In a Business Combination involving cash or other consideration being paid
to Wintrust's shareholders, the consideration would be required to be either
cash or the same type of consideration used by the Interested Shareholder in
acquiring the largest portion of shares previously acquired by it. In the case
of payments to holders of Common Stock, the per share fair market value of such
payments generally would have to be at least equal in value to the higher of
(i) the highest per-share price paid (including any brokerage commissions,
transfer taxes and soliciting dealers' fees) by the Interested Shareholder in
acquiring any Wintrust Common Stock during the two-year period prior to the
first public announcement of the proposed business combination (although not an
Interested Shareholder at the time of any such acquisitions) or in the
transaction in which it became an Interested Shareholder (whichever is higher);
or (ii) the fair market value of Wintrust shares on the first trading date
after the date of such announcement date or on the first trading date after the
date on which the Interested Shareholder became an Interested Shareholder,
(whichever is higher); in any case appropriately adjusted for any stock
dividend, stock split, combination of shares or similar event.

In a Business Combination involving cash or other consideration being paid
to the holders of Wintrust shares other than Wintrust Common Stock, the
consideration would have to be at least equal in value to the higher of (i) the
highest per-share price (including any brokerage commissions, transfer taxes
and soliciting dealers' fees) paid by the Interested Shareholder in acquiring
any Wintrust Common Stock during the two-year period prior to the first public
announcement of the proposed business combination (although not an Interested
Shareholder at the time of any such acquisitions) or in the transaction in
which it became an Interested Shareholder (whichever is higher); or (ii) the
highest per-share amount to which the holders of shares are entitled in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
Wintrust; or (iii) the fair market value of Wintrust shares on the first
trading date after such announcement date or the date on which the Interested
Shareholder became an Interested Shareholder (whichever is higher); and (iv)
the price per-share equal to the fair market value per-share determined in
(iii) above, multiplied by the ratio of (x) the highest per-share price paid by
the Interested Shareholder in acquiring any Wintrust Common Stock during the
two-year period prior to such announcement date (although not an Interested
Shareholder at the time of any such acquisitions) to (y) the fair market value
per-share on the first day in such two-year period upon which the Interested
Shareholder acquired any shares; in any case appropriately adjusted for any
stock dividend; stock split, combination of shares or similar event.

Fair price provisions are designed to impede two-step takeover transactions
which might otherwise result in disparate treatment of Wintrust's shareholders.
The Charters and by-laws of the Companies do not contain any super majority
shareholder voting provisions or fair price provisions with respect to
transactions with interested parties.

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AMENDMENT OF THE ARTICLES AND BY-LAWS

Amendment of the Articles must be approved by a majority vote of the Board
of Directors and also by a 2/3 vote of the outstanding shares of Wintrust
Common Stock, provided, however, that an affirmative vote of at least 85% of
the outstanding voting stock entitled to vote is required to amend or repeal
certain provisions of the Articles, including provisions (i) limiting voting
rights, (ii) relating to certain business combinations, (iii) limiting the
shareholders ability to act by written consent, (iv) regarding the number,
classification of directors, filling of Board vacancies, newly created
directorships, indemnification of directors and officers by Wintrust and
limitation of liability for directors, (v) regarding shareholder proposals and
director nominations and (vi) regarding amendment of the foregoing super
majority provisions of Wintrust's Articles. Wintrust's By-Laws may be amended
only by the Board of Directors.

The Charters and by-laws of the Companies do not contain any super majority
shareholder vote requirement to amend the Charters and by-laws of the
Companies.

WINTRUST FINANCIAL CORPORATION

OPERATIONAL PHILOSOPHY

Upon effectiveness of the Reorganization, Wintrust will have five direct
wholly-earned subsidiaries: Lake Forest, Hinsdale, North Shore Bank,
Libertyville, and Crabtree; and four second-tier operating subsidiaries: Lake
Forest Bank, Hinsdale Bank, Libertyville Bank and First Premium, each of which
will continue to be wholly-owned by its respective parent holding company.
(There will continue to be outstanding following the Reorganization certain
warrants to purchase shares of Hinsdale and Libertyville held by certain
officers and directors.)

After the Effective Date, the operations of the Companies will continue to
be conducted in substantially the same manner as presently conducted. Each of
the Companies has effectively competed in its respective business niches by
emphasizing quality products delivered through traditional and state-of-the-art
systems and by prioritizing highly responsive and personalized attention to
customer service. Management believes that these operational objectives can be
best achieved by retaining decision making in the on-site Bank management
personnel and their respective Bank boards, largely comprised of local
community leaders in the Bank's respective market areas. Similarly, First
Premium management and its board will continue to manage the insurance premium
finance operations in order to allow Wintrust to maximize the benefit of the
significant specialized expertise of such persons in this financial services
niche and to best preserve the many insurance agent relationships key to the
success of First Premium's business.

The present senior management currently shared by the Companies are
anticipated to serve as the Wintrust executive officers after the Effective
Date and will continue to have responsibility for capital planning, long-term
strategic planning, marketing and advertising, financial management and
asset/liability management and technology, while the existing management teams
of the Banks and First Premium will continue to have the full managerial
responsibilities with respect to customer service and the ongoing day-to-day
operations of their respective subsidiaries. The Boards of Directors of each
of the Banks and of First Premium will not be changed as a result of the
Reorganization and will continue to have full oversight responsibilities of
their respective management teams.

Management believes that, in addition to the operational efficiencies
of formally combining the shared senior management functions and the improved
access to more efficient sources of additional capital, the strategic
combination of the five Companies offers certain synergies to potentially
enhance profitability. While the Banks, as is typical for newly formed
retail-oriented banks, have generated core deposits in excess of earning asset
growth, First Premium utilizes external funding sources, such as its
securitization facility, to support planned growth in insurance premium
receivables. The Banks can potentially offer First Premium an alternative
lower cost funding

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source, while potential investments in premium finance receivables originated
by First Premium can offer the Banks an additional source of higher yielding
earning assets. This investment opportunity would be consistent with the
Banks' strategy of pursuing specialized earning asset niches having large
volumes of homogenous assets that can be acquired for the Banks' portfolios,
such as the indirect auto loan program currently in place, and possibly sold in
the secondary market to generate fee income. Management intends to pursue
opportunities to leverage off of the respective Companies' asset/liability
generating strengths.

MANAGEMENT OF WINTRUST

As provided in the Reorganization Agreement, the Board of Directors of
Wintrust will initially consist of 21 members comprised of certain members of
the currents boards of each of the Companies. Following consummation of the
Reorganization, the Wintrust Board will determine which directors will serve as
Class I, II and III directors to hold office for staggered three-year terms as
provided in the By-Laws. See "COMPARATIVE RIGHTS OF SHAREHOLDERS OF WINTRUST
AND THE COMPANIES -- Size and Classification of the Board of Directors." It is
currently anticipated that the Board will establish certain committees to
include, among possible others, an Audit Committee, Nominating Committee and
Asset/Liability Management Committee, with the full board acting as the
Compensation Committee. The Wintrust Board is expected to meet quarterly and
at such other times deemed necessary.

The names, certain background information and the ages of the persons
designated in the Reorganization Agreement to constitute the initial Board of
Directors and the executive officers of Wintrust are provided below.

BOARD OF DIRECTORS

Howard D. Adams -- (63) Chairman and Chief Executive Officer of Wintrust.

Mr. Adams is a financier who, for more than the past 10 years, has
concentrated his investments primarily in diversified financial services
businesses. He was the principal organizer of each of the Companies. Since
1986, Mr. Adams has served as Chairman of Crabtree and has been an officer and
director of its various subsidiaries, including First Premium. Together with
Edward J. Wehmer and certain other organizers, he founded Lake Forest in 1991,
Hinsdale in 1993, North Shore in 1994 and Libertyville in 1995. He is
currently the Chairman and a Director of Crabtree, Lake Forest and
Libertyville, and he is the Vice-Chairman and a Director of North Shore and of
Hinsdale. He also serves as director of each of the Banks and First Premium.

Prior to 1986, Mr. Adams was associated in various capacities with the firm
of Booz, Allen & Hamilton Inc. for 23 years where he was the partner
responsible for domestic and international banking and financial consulting
services. He eventually served as the senior advisor in those areas. Mr.
Adams is a Trustee of the Chicago Horticultural Society and Colby College of
Waterville, Maine (retired) and is a member of the Lake Forest Open Lands
Association.

Edward J. Wehmer -- (42) President and Director of Wintrust.

Mr. Wehmer has been a principal organizer, together with Howard D. Adams, of
each of the banking organizations. He has served as the President of Lake
Forest and Lake Forest Bank since its establishment in 1991. Mr. Wehmer serves
as the Vice Chairman and a Director of Lake Forest, Hinsdale, North Shore,
Libertyville and each of the Banks.

Prior to joining Lake Forest, Mr. Wehmer was President and a director of
Lincoln National Bank, Chicago, Illinois and Senior Vice President, Chief
Financial Officer, and a director of its parent company, River Forest Bancorp,
Chicago, Illinois. Mr. Wehmer also served as a managing director of that
organization's six other banking subsidiaries and as President of a mortgage
banking subsidiary and a commercial finance subsidiary. Mr. Wehmer is also a
certified public accountant and earlier in his career spent seven years with
the accounting firm of Ernst & Whinney specializing in the banking field and
particularly in the area of bank mergers and acquisitions. Mr.

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Wehmer is a Trustee of Barat College, Lake Forest, Illinois, and is involved in
several other charitable and fraternal organizations.

Lemuel H. Tate, Jr. -- (70) Director of Wintrust.

From 1982 to 1988, Mr. Tate was an executive with Northwestern
Telecommunication Services (now known as Northwestern Technologies Group) which
is a venture partnership company jointly owned by Northwestern University and
Northwestern Memorial Hospital Group. He retired as President and Chief
Operating Officer of the company in 1988. During his retirement since 1988, he
has been active in volunteer work in the area. He is a member of the Evanston
Rotary Club and is active in the International Executive Service Corps. Since
establishment, Mr. Tate has been Chairman and a Director of North Shore and
North Shore Bank, which opened in 1994, and he served on the Special Committee
appointed by the North Shore Board to consider the Reorganization.

Alan W. Adams -- (31) Director of Wintrust.

Mr. Adams has been Vice President/Lending at Lake Forest Bank since August
1993. Prior to his association with Lake Forest Bank, Mr. Adams was the Senior
Financial and Strategic Analyst for Crabtree after obtaining his law degree in
1993. He is licensed to practice law in the State of Illinois and is a member
of the Illinois and American Bar Associations. From 1987 through 1989, Mr.
Adams was a commercial lending representative for Harris Trust and Savings
Bank, specializing in banking relationships with companies in the food and
agribusiness industries. Mr. Adams serves on the board of directors of the
Gorton Community Center and the Associate Board of the Lake Forest Open Lands
Association. He is the son of Howard D. Adams.

Peter Crist -- (44) Director of Wintrust.

Mr. Crist is a partner with Crist Partners, Ltd., an executive search firm
he founded in 1994. Immediately prior thereto he was the Managing Director of
the Chicago office of Russell Reynolds Associates, Inc., the largest executive
search firm in the Midwest where he was employed for more than ___ years. He
is a Director of Hinsdale and Hinsdale Bank, and he served on the Special
Committee appointed by the Hinsdale Board to consider the Reorganization.

Maurice F. Dunne, Jr. -- (69) Director of Wintrust.

Mr. Dunne has been the President of Maurice F. Dunne Ltd., an educational
consulting firm, since September 1991. Prior thereto, he served as President
of the Graduate School of Management at Lake Forest College, Lake Forest,
Illinois for more than 25 years. Mr. Dunne also served as the chief operating
officer of the Northern Illinois Business Association from September 1991 to
June 1993. Mr. Dunne is a Director of North Shore and Lake Forest and their
respective bank subsidiaries.

Eugene Hotchkiss III -- (68) Director of Wintrust.

Mr. Hotchkiss served as the President of Lake Forest College from 1970 to
1993 and has been the President Emeritus of Lake Forest College since 1993.
Since 1994, Mr. Hotchkiss has been the Senior Fellow of the Foundation for
Independent Higher Education, Lake Forest College. Mr. Hotchkiss is a
Director of Lake Forest and Lake Forest Bank.

James Knollenberg -- (48) Director of Wintrust.

Mr. Knollenberg serves as the President of First Premium, which he helped
form, together with an experienced management team, in 1990. Mr. Knollenberg
has 25 years experience in corporate financial services. In 1975, he
co-founded Borg-Warner Insurance Finance Corp. (BWIFC), the premium finance
unit of Borg Warner Financial Services, which was later acquired by
Transamerica Corporation. In the 1980's he served four years as

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Chief Financial Officer of Willis Corroon's Brokerage Services Group followed
by four years as Director of Receivables Management for Sedgwick, Inc.

John S. Lillard -- (65) Director of Wintrust.

Mr. Lillard spent more than fifteen years as an executive with JMB
Institutional Realty Corporation, a real estate investment firm, where he
served as President from 1979 to 1991 and as Chairman-Founder from 1992 to
1994. In addition, Mr. Lillard serves as a director of Cintas Corporation and
Stryker Corporation. Mr. Lillard was a general partner of Scudder Stevens &
Clark until joining JMB in 1979. Mr. Lillard is a Director of Lake Forest and
Lake Forest Bank.

James E. Mahoney -- (59) Director of Wintrust.

From 1978 to present, Mr. Mahoney has been the owner and President of
Heidi's Cheese Products, Inc., Mundelein, Illinois. Mr. Mahoney is a Director
of Libertyville and Libertyville Bank, and he served on the Special Committee
appointed by the Libertyville Board to consider the Reorganization.

James B. McCarthy -- (45) Director of Wintrust.

From 1991 to present, Mr. McCarthy has been President and a Director of
Gemini Consulting Group, Inc., Oak Brook, Illinois, a management consulting
firm focusing on the health care industry. Mr. McCarthy is a Director of
Hinsdale and Hinsdale Bank, and he served on the Special Committee appointed by
the Hinsdale Board to consider the Reorganization.

Marguerite Savard McKenna -- (51) Director of Wintrust.

Ms. McKenna, an attorney, has practiced in Wilmette since 1983. She is a
member of the Rotary Club, Wilmette Chamber of Commerce and the North Suburban
Bar Association. Ms. McKenna is a Director of North Shore and North Shore
Bank, and she served on the Special Committee appointed by the North Shore
Board to consider the Reorganization.

Tull Monsees -- (62) Non-voting Director of Wintrust.

For over five years, Mr. Monsees has been a Senior Vice President with
Principal Financial Securities (and two predecessor firms, Illinois Company and
Hamilton Investments), Chicago, Illinois. Mr. Monsees is a Director of
Crabtree, and he served on the Special Committee appointed by the Crabtree
Board to consider the Reorganization. He will serve as a non-voting director
of Wintrust due to his affiliation with the securities brokerage firm.

Albin F. Moschner -- (43) Director of Wintrust.

Mr. Moschner has been President and CEO and a director of Zenith
Electronics, Glenview, Illinois, since 1991. Previously he held the positions
of Chief Operating Officer and Senior Vice President of Operations. Mr.
Moschner is also a director of Polaroid Corporation and Pella Windows. Mr.
Moschner is a Director of Lake Forest and Lake Forest Bank, and he served on
the Special Committee appointed by the Lake Forest Board to consider the
Reorganization.

Hollis W. Rademacher -- (60) Director of Wintrust.

Mr. Rademacher is currently self-employed as a business consultant and
private investor. He has participated with Mr. Adams and Mr. Wehmer as an
organizer of each of the Banks. From 1957 to 1993, Mr. Rademacher held various
positions with Continental Bank, N.A., Chicago, Illinois, from 1988 to 1993
holding the positions of Officer in Charge, U.S. Banking Department, Chief
Credit Officer and Chief Financial Officer. Mr.

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58

Rademacher also currently serves as a director of Schawk, Inc., Cityscape
Financial Corp., Anthem Financial, Inc., Continere Corp., Kirke/Van Orsdel,
Inc., Harken's Distribution, Inc., and Banker's Systems, Inc. He is a Director
of North Shore, Hinsdale, Libertyville, Lake Forest and each of the Banks.

J. Christopher Reyes -- (42) Director of Wintrust.

Since 1979, Mr. Reyes has been Chairman and President of Chicago Beverage
Systems, Inc., a beverage distributor headquartered in Lake Forest, Illinois.
Mr. Reyes is a Director of Lake Forest and Lake Forest Bank, and he served on
the Special Committee appointed by the Lake Forest Board to consider the
Reorganization.

John N. Schaper -- (44) Director of Wintrust.

Mr. Schaper is a general agent for American United Life Insurance Company.
Mr. Schaper is a Director of Libertyville and Libertyville Bank, and he served
on the Special Committee appointed by the Libertyville Board to consider the
Reorganization.

John J. Schornack -- (65) Director of Wintrust.

Mr. Schornack is Chairman and CEO of KraftSeal Corporation, Lake Forest,
Illinois. From 1955 to 1991 Mr. Schornack was a certified public accountant
with Ernst & Young, serving most recently as Vice Chairman and Managing Partner
of the Midwest Region. Mr. Schornack also serves as a director of Binks
Manufacturing Company. Mr. Schornack is a Director of North Shore and North
Shore Bank, and he served on the Special Committee appointed by the North Shore
Board to consider the Reorganization.

Jane R. Stein -- (51) Director of Wintrust.

Ms. Stein is currently the Executive Director of the Lake County Medical
Society, Vernon Hills, Illinois, a not-for-profit professional association.
Ms. Stein is a Director of Libertyville and Libertyville Bank, and she served
on the Special Committee appointed by the Libertyville Board to consider the
Reorganization.

Katherine Sylvester -- (56) Director of Wintrust.

Mrs. Sylvester has been active in civic affairs in the Hinsdale area for
many years. She is on the Board of Trustees of the Hinsdale Community House
and is an Associate Member of the Women's Auxiliary of the Robert Crown Center
for Health Education, and an Associate Member of the Women's Board of the
Rehabilitation Institute of Chicago. Mrs. Sylvester is a Director of Hinsdale
and Hinsdale Bank, and she served on the Special Committee appointed by the
Hinsdale Board to consider the Reorganization.

Larry Wright -- (56) Director of Wintrust.

For the past 32 years, Mr. Wright has been Vice President of Milbank
Corporation, Chicago, Illinois, an investment advisory firm. He is a Director
of Crabtree, and he served on the Special Committee appointed by the Crabtree
Board to consider the Reorganization.

EXECUTIVE OFFICERS

The following persons, all of whom are currently employed on a shared basis
by each of the banking Companies or otherwise provide consulting services to
each of the Companies, are designated in the Reorganization Agreement to serve
as the executive officers of Wintrust following the Effective Date.

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59

Howard D. Adams -- (63) Chairman and Chief Executive Officer of Wintrust.

Mr. Adams will serve as Wintrust's Chief Executive Officer and will oversee
the long-term strategic, marketing and organizational planning of the Company.
See the description above under "Board of Directors" for biographical
information.

Edward J. Wehmer -- (42) President and Director of Wintrust.

Mr. Wehmer will serve as Wintrust's President and perform the functions of
the Chief Operating Officer. Accordingly, he will be responsible for
overseeing the execution of Wintrust's day-to-day operations and strategic
initiatives. Mr. Wehmer also serves as President of Lake Forest and its
subsidiary. See the description above under "Board of Directors" for
biographical information.

David A. Dykstra -- (35) Executive Vice President, Chief Financial Officer and
Treasurer of Wintrust.

Mr. Dykstra will serve as Wintrust's Chief Financial Officer and will
oversee all financial affairs of Wintrust, including internal and external
financial reporting. Mr. Dykstra currently serves as an Executive Vice
President and Chief Financial Officer of Lake Forest, Hinsdale, North Shore,
Libertyville and each of the Banks. Prior thereto, Mr. Dykstra was employed
from 1990 to 1995 in a similar capacity by River Forest Bancorp, Inc., Chicago,
Illinois, most recently holding the position of Senior Vice President and Chief
Financial Officer. Prior to his association with River Forest Bancorp, Mr.
Dykstra spent seven years with KPMG Peat Marwick, most recently holding the
position of Audit Manager in the Financial Institutions practice. In addition
to various civic and charitable activities, Mr. Dykstra is a Trustee of the
Village of Lake Villa. Mr. Dykstra is a Director of Libertyville and
Libertyville Bank.

Lloyd Bowden -- (42) Executive Vice President -- Technology.

Mr. Bowden will serve as Executive Vice President - Technology for Wintrust
and will be responsible for planning, implementing and maintaining all aspects
of the Banks' internal data processing systems and technology designed to
service the Banks' customer base. Mr. Bowden joined the Companies in April
1996 to serve as the Director of Technology at Lake Forest, Hinsdale, North
Shore and Libertyville with responsibility for implementing technological
improvements to enhance customer service capabilities and operational
efficiencies. Prior thereto, he was employed by Electronic Data Systems, Inc.
in various capacities since 1982, most recently in an executive management
position with the Banking Services Division and previously in the Banking Group
of the Management Consulting Division.

Robert F. Key -- (41) Executive Vice President -- Marketing.

Mr. Key will serve as the Executive Vice President - Marketing for Wintrust
and will direct all advertising and marketing programs for each of the
Companies. Mr. Key joined the Companies in March 1996 to serve as Executive
Vice President of Marketing at Lake Forest, Hinsdale, North Shore and
Libertyville. From 1978 through

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60

March 1996, Mr. Key was a Vice President/Account Director at Leo Burnett
Company where he most recently had responsibility for the $30 million
advertising budget of a $600 million business.

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PRO FORMA BENEFICIAL OWNERSHIP INFORMATION

The table below sets forth the pro forma beneficial ownership of Wintrust
Common Stock of (i) each director nominee of Wintrust as designated in the
Reorganization Agreement; (ii) each proposed executive officer of Wintrust as
designated in the Reorganization Agreement; (iii) such director nominees and
executive officers as a group; and (iv) all other persons anticipated to be
holders of or who might be deemed to be the beneficial owner of more than 5% of
the Wintrust Common Stock to be outstanding upon the Effective Date of the
Reorganization. For more detailed information regarding beneficial ownership
of the respective Companies, see "Management Ownership of Common Stock" and
"Beneficial Ownership of Certain Shareholders" under "NORTH SHORE COMMUNITY
BANCORP, INC.," "LAKE FOREST BANCORP, INC.," "HINSDALE BANCORP, INC.,"
"LIBERTYVILLE BANCORP, INC.," and "CRABTREE CAPITAL CORPORATION."

Pro Forma
Total Total Total Total Wintrust %
Lake Forest Hinsdale North Shore Libertyvile Crabtree Pro forma Ownership
Beneficial Beneficial Beneficial Beneficial Beneficial Beneficial of
Ownership Ownership Ownership Ownership Ownership Ownership(1) Wintrust(1)(2)
------------ --------- ------------ ---------- ---------- ----------- --------------

DIRECTORS NOMINEES OF WINTRUST
Alan W. Adams(3) . . . . . . . . . 4,840 1,050 9,402 15,659 20,433 155,969 2.42%
Howard D. Adams(4)** . . . . . . . 18,090 22,083 6,368 5,300 123,141 485,920 7.56%
Peter Crist . . . . . . . . . . . . -- 3,210 1,000 1,000 -- 27,652 *
Maurice F. Dunne, Jr. . . . . . . . 1,780 2,100 2,882 2,200 -- 53,623 *
Eugene Hotchkiss III . . . . . . . 334 -- -- 200 -- 4,036 *
James Knollenberg . . . . . . . . . 200 300 300 300 61,361 79,111 1.22%
John S. Lillard . . . . . . . . . . 3,966 -- 1,623 1,000 -- 50,768 *
James E. Mahoney . . . . . . . . . -- -- -- 1,620 -- 6,522 *
James B. McCarthy . . . . . . . . . -- 2,717 -- -- -- 15,489 *
Marguerite Savard McKenna . . . . . -- -- 3,162 600 -- 18,737 *
Tull Monsees . . . . . . . . . . . -- -- -- -- 40,800 48,279 *
Albin F. Moschner. . . . . . . . . 400 -- -- -- -- 3,869 *
Hollis W. Rademacher . . . . . . . -- 2,590 3,194 3,995 -- 47,293 *
J. Christopher Reyes . . . . . . . 3,414 4,400 5,083 4,000 -- 101,915 1.58%
John N. Schaper . . . . . . . . . . -- -- -- 300 -- 1,208 *
John J. Schornack . . . . . . . . . -- -- 1,952 -- -- 10,076 *
Jane R. Stein . . . . . . . . . . . -- -- -- -- -- -- *
Katherine Sylvester . . . . . . . . -- 980 -- -- -- 5,008 *
Lemuel H. Tate . . . . . . . . . . -- -- 3,113 100 -- 16,471 *
Edward J. Wehmer** . . . . . . . . 10,884 6,936 8,989 7,350 -- 210,581 3.20%
Larry Wright(5) . . . . . . . . . . 14,650 20,400 15,600 2,500 123,753 501,836 7.72%
------ ------ ------ ------ ------- --------- -----
Total Directors . . . . . . . . . 59,558 66,766 62,668 46,124 369,488 1,844,363 28.50%

NON-DIRECTOR EXECUTIVE OFFICERS
Lloyd M. Bowden . . . . . . . . . . 455 625 667 1,000 -- 10,223 *
David A. Dykstra . . . . . . . . . 550 500 175 1,958 -- 14,949 *
Robert F. Key . . . . . . . . . . . 409 563 600 900 -- 14,074 *
------ ------ ------ ------ ------- --------- -----

Total Directors and Executive 60,972 68,454 64,110 49,982 369,488 1,883,659 29.19%
====== ====== ====== ====== ======= ========= =====
OTHER SIGNIFICANT SHAREHOLDERS
Milbank Corporation(6) . . . . . . 15,650 20,990 15,600 2,500 124,453 514,992 8.01%

---------------
* Less than 1%
** Denotes executive officer (in addition to director status)

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62

(1) Excludes beneficial ownership of any shares subject to warrants of
Hinsdale and Libertyville which will remain outstanding after the
Reorganization at the respective mid-tier holding company subsidiary of
Wintrust.

(2) Assumes no exercise prior to the Reorganization of outstanding options,
rights or warrants other than the anticipated exercise of a portion of the
First Premium warrants resulting in 399,612 additional shares of Wintrust
Common Stock to be outstanding immediately following the Effective Date of
the Reorganization. Includes shares deemed beneficially owned by such
persons in any of the other Companies, giving effect to the applicable
Exchange Ratios and North Shore Stock Split. Also gives effect to the
cancellation of intercompany share ownership as provided in the
Reorganization Agreement.

(3) Includes shares to be held in certain family trusts for the benefit of
Alan W. Adams and with respect to which he has shared voting and
investment power. Does not include shares to be held in certain other
family trusts (for which Alan Adams does not act as co-trustee) and does
not include shares to be held directly by, or indirectly through other
family trusts for the benefit of Sarah K. Adams, Alan Adams' sister.
Sarah K. Adams and Alan W. Adams are the two adult children of Howard D.
Adams.

(4) Includes shares to be held in certain family trusts for the benefit of Mr.
Adams' children or in charitable foundations with respect to which either
Mr. Adams or his wife has voting power and with respect to which Mr. Adams
disclaims beneficial ownership. Does not include shares to be held
directly by, or indirectly through certain other family trusts (for which
neither Mr. Adams nor his wife act as co- trustees) for the benefit of,
Mr. Adams' two adult children. See the footnotes to beneficial ownership
tables in the section "Management Ownership of Common Stock" under each of
"NORTH SHORE COMMUNITY BANCORP, INC.," "LAKE FOREST BANCORP, INC.,"
"HINSDALE BANCORP, INC.," "LIBERTYVILLE BANCORP, INC.," AND "CRABTREE
CAPITAL CORPORATION" for additional information.

(5) Includes (i) 16,393 shares to be held directly by Mr. Wright; (ii) 5,804
shares to be held by Milbank Corporation ("Milbank") of which Mr. Wright
is an officer, director and principal shareholder and with respect to
which shares he exercises shared voting and investment power; (iii) 22,611
shares to be held by an employee retirement plan of Milbank of which Mr.
Wright is a trustee with shared voting and investment power; (iv) 377,588
shares to be held in Deerpath Investments LLP, a limited partnership
("Deerpath"), to which Milbank serves as investment advisor and with
respect to which Mr. Wright exercises shared voting and investment power;
and (v) 4,827 shares to be held in certain family trusts of another
officer of Milbank with respect to which certain officers of Milbank act
as co-trustees and exercise shared voting power. Also includes 74,612
shares to be subject to purchase by Deerpath pursuant to the exercise of
warrants (assuming no prior exercise) giving effect to the conversion of
the outstanding First Premium common stock warrants as contemplated by the
Reorganization Agreement. See footnote (6) below for a description of
Milbank total pro forma beneficial ownership which includes that of Mr.
Wright.

(6) Includes (i) 16,393 shares to be held by Larry Wright, a director of
Crabtree, and an aggregate of 3,483 shares to be held or to be subject to
currently exercisable options held by Robert D. Harnach, a director of
Lake Forest and Hinsdale, each of whom are officers of Milbank Corporation
("Milbank"); (ii) 5,804 shares to be held by Milbank; (iii) 22,611 shares
to be held by an employee retirement plan of Milbank of which Mr. Wright
and Mr. Harnach are trustees with voting and investment power; (iv)
377,588 shares to be held in Deerpath Investments LLP, a limited
partnership ("Deerpath") to which Milbank serves as investment advisor and
with respect to which Mr. Wright and Mr. Harnach exercise shared voting
and investment power; and (v) 14,500 shares to be held in certain family
trusts of another officer of Milbank with respect to which certain
officers of Milbank act as co-trustees and exercise shared voting power.
Also includes 74,612 shares to be subject to purchase by Deerpath pursuant
to the exercise of warrants (assuming no prior exercise) giving effect to
the conversion of the outstanding First Premium common stock warrants as
contemplated by the Reorganization Agreement. See footnote (5) above for
a description of the pro forma beneficial ownership of Larry Wright
included within that of Milbank.

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63

EXECUTIVE COMPENSATION

The following table summarizes the compensation paid, on a pro forma
combined basis giving effect to the Reorganization, to the Chairman and Chief
Executive Officer and the four other most highly paid executive officers (the
"Named Executive Officers"), for 1995 and 1994 and the salary and certain other
compensation estimated to be paid in 1996.

Summary Compensation Table
--------------------------------------------------------------------------------------------------------
Annual Compensation Long-Term Compensation
--------------------------------------- ----------------------------------
Awards Payouts
-------------------- --------
Other Securities
Annual Under- All Other
Compen- Restricted lying LTIP Compen-
Name and Salary (5) Bonus sation (2) Stock Options/ Payouts sation (4)
Principal Position Year ($) ($) ($) Awards SARs (#) ($) ($)
------------------ ----- ---------- -------- ---------- --------- --------- -------- -----------

Howard D. Adams(6) 1996 250,000 --(1) --(2) -- -- -- --
Chairman and CEO 1995 190,000 43,000 629 -- -- -- --
1994 141,000 10,000 -- -- -- -- --

Edward J. Wehmer(7) 1996 395,000 --(1) --(2) -- -- -- --
Chief Operating 1995 326,250 43,000 5,935 -- -- -- 3,592
Officer 1994 255,000 25,000 4,862 -- -- -- 3,482

David A. Dykstra 1996 155,000 --(1) --(2) -- 2,779 -- --
Exec. Vice President 1995 80,889 12,000 2,486 -- 30,880 -- --
& Chief Financial 1994 N/A N/A N/A -- -- -- --
Officer

Robert Key 1996 121,233 15,000(3) --(2) -- 29,226 -- --
Exec. Vice President 1995 N/A N/A N/A -- -- -- --
& Director of 1994 N/A N/A N/A -- -- -- --
Marketing

Lloyd Bowden 1996 90,082 10,000(3) --(2) -- 18,671 -- --
Exec. Vice President 1995 N/A N/A N/A -- -- -- --
& Director of 1994 N/A N/A N/A -- -- -- --
Technology

- ---------------
(1) Mr. Adams, Mr. Wehmer, and Mr. Dykstra are entitled to be paid
discretionary bonuses as determined by the compensation committee of the
Board of Directors. To date, no such bonuses have been declared or paid.

(2) Other compensation represents the sum of compensation for the use of a
company car and/or the payment of club dues.

(3) Mr. Key and Mr. Bowden were employed by North Shore, Lake Forest, Hinsdale,
and Libertyville on March 11, 1996 and April 1, 1996, respectively. The
bonus amounts presented represent the aggregate signing bonus paid to these
individuals in 1996. Mr. Key and Mr. Bowden are also entitled to be paid
additional discretionary bonuses as determined by the compensation
committee of the Board of Directors. To date, no such additional bonuses
have been declared or paid.

(4) Represents compensation to the executive officer for the aggregate life
insurance premium paid on behalf of the named executive officer by any of
the Companies subject to the Reorganization.

(5) The 1996 salary amount presented for each individual reflects the
aggregated base annual salary amounts expected to be paid in 1996 based on
the number of days employed in 1996 and the level at which the named
executive is currently being paid by each of the Companies subject to this
Reorganization.

(6) Mr. Adams also received a salary from HDA Capital Corporation of $50,000
for 1995 and 1994 and is receiving the same amount in 1996. Such amounts
are not included as compensation in the above table. HDA Capital
Corporation receives income in the form of consulting fees from Crabtree
for Mr. Adams' services. Specifically, consulting fees of $46,671,
$142,692 and $111,030 were received for the four months ended April 30,
1996, the year ended December 31, 1995 and the year ended December 31,
1994, respectively. HDA Capital Corporation is owned by the Alan W. Adams
Family Trust and the Sarah K. Adams Family Trust.

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64
(7) During 1996, Edward J. Wehmer entered into deferred compensation plans with
Libertyville and Lake Forest. The deferred compensation plans are in the
form of "Phantom Stock Agreements" whereby the amount of compensation
deferred is equal to the value which Edward J. Wehmer would have received
had he held 6,000 shares of Libertyville and 1,300 shares of Lake Forest as
of the date of the awards, respectively.

The information presented below summarizes certain information, on a
pro forma combined basis giving effect to the Reorganization, about the
Wintrust Common Stock underlying options which were granted in 1995 by the
Companies to the named executive officers.

OPTION/SAR GRANTS IN LAST FISCAL YEAR

% of Potential Realized
Number of Total Value at Assumed
Wintrust Options/ Annual Rates of
Shares SARs Stock Price
Underlying Granted to Exercise Appreciation
Options/ Employees of Base for Option Term
SARs in Fiscal Price Expiration -----------------------
Name Granted Year (1) ($Sh)(1) Date 5% 10%
---- ---------- ---------- -------- ---------- ------- -------

Howard D. Adams -- -- -- -- -- --
Edward J. Wehmer -- -- -- -- -- --
David A. Dykstra 30,880 18.38% --(2) 2005 $ 207,850 $ 526,732

Robert F. Key -- -- -- -- -- --
Lloyd Bowden -- -- -- -- -- --

- ---------------
(1) All information is presented on a pro forma combined basis assuming each of
the Companies' options and exercise prices have been converted by giving
effect to the Exchange Ratios and represent on a pro forma basis options to
purchase shares of Wintrust Common Stock.

(2) The exercise price per share is $9.30 for options to purchase 11,608 shares
of Wintrust Common Stock; $10.77 for options to purchase 7,241 shares of
Wintrust Common Stock; $11.62 for options to purchase 6,194 shares of
Wintrust Common Stock; and $12.42 for options to purchase 5,837 shares of
Wintrust Common Stock.

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65
The following table summarizes the number and value of stock options
relating to Wintrust Common Stock, on a pro forma combined basis giving effect
to the Reorganization, that were unexercised at December 31, 1995. No stock
options were exercised by the named executives during 1995 or the first quarter
of 1996.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES

Number of
Securities Underlying
Unexercised Value of Unexercised
Options/SARs at Options/SARs at
December 31, 1995 (#) December 31, 1995 ($)
Shares ------------------------ ------------------------
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized ($) Unexercisable(1) Unexercisable(1)
---- ------------- ------------ ------------------------ ------------------------

Howard D. Adams -- -- 11,234/2,902 18,349/10,500
Edward J. Wehmer -- -- 84,622/31,458 413,658/144,354
David A. Dykstra -- -- 4,712/26,168 9,000/45,000
Robert Key -- -- --/-- --/--
Lloyd Bowden -- -- --/-- --/--

- ---------------
(1) The numbers and amounts in the above table represent, on a pro forma
combined basis giving effect to the Reorganization, shares of Wintrust
Common Stock subject to stock options that were unexercised as of December
31, 1995, assuming such options had been converted to reflect the
respective Company's Exchange Ratio.

PROPOSED PUBLIC OFFERING

It is anticipated that Wintrust will need additional capital to
support further growth in assets at a number of the Banks within the next six
months to a year. The Reorganization offers each of the Companies the benefit
of raising capital as a larger organization with greater access to more
efficient capital markets and the opportunity to potentially obtain more
favorable terms. It is anticipated that Wintrust may seek to raise up to an
additional $20 million of debt and/or equity capital in 1996. Among other
capital raising alternatives, management has considered seeking to borrow on a
consolidated basis from a commercial bank, with borrowings to be possibly
secured by pledges of capital stock of the Banks and First Premium, and a
possible public or private offering of shares of Wintrust Common Stock which
may be targeted to investors residing in new market areas being targeted by the
Banks or Wintrust.

While there can be no assurance that Wintrust will determine to pursue
a public offering of Wintrust Common Stock to raise capital in the near term,
should Wintrust proceed with an underwritten public offering of its shares, a
market for Wintrust Common Stock may develop which could provide a source of
liquidity to investors in the Companies. It is also anticipated that, whether
or not Wintrust undertakes a public offering, certain broker-dealer firms may
commence to make a market in the Wintrust shares following the Reorganization.
Management is unable to predict at what price such a market, if any, may
develop. See "RISK FACTORS AND CERTAIN OTHER CONSIDERATIONS -- Limited Market
for Shares."

POSSIBLE ACQUISITION

Following consummation of the Reorganization, it is expected that the
Board of Directors and management of Wintrust will consider the feasibility of
acquiring a fifth bank currently in organization by Howard D. Adams, Edward J.
Wehmer and certain other persons who are directors and/or executive officers
of one or more of the Companies and may serve as directors and/or executive
officers of Wintrust. Organizational efforts

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66

completed to date include identifying a favorable location and securing
a lease for the bank site in a northwestern suburban community, commencement of
the bank regulatory application process and initial discussions with potential
candidates to serve as bank personnel. The organizers have initially
capitalized an Illinois corporation, Wolfhoya Investments, Inc. ("Wolfhoya"),
with $526,000 to fund organizational expenses relating to the de novo bank
formation and hold certain warrants to acquire additional shares in Wolfhoya.

The Organizers believe that acquiring Wolfhoya in its organizational
phase could provide Wintrust an attractive opportunity to expand its franchise
into an affluent community not yet served by the other Banks where the same
community banking concept and similar marketing strategies can be successfully
employed to achieve significant growth in deposits. Accordingly, the
organizers have indicated their willingness to sell Wolfhoya to Wintrust after
consummation of the Reorganization; however, the terms of any such transaction
would be subject to negotiation by Wintrust after the Reorganization and would
require approval by the Wintrust Board of Directors. Consequently, there can
be no assurances when or if this possible acquisition may be consummated.

DIVIDEND POLICY

Pre-Reorganization Dividend Policy. None of the banking Companies has
since inception nor has Crabtree during the past five years declared or paid
any dividends. With the exception of the North Shore Stock Split, the
Reorganization Agreement prohibits the Companies from declaring or paying any
dividend on, or making any other distribution in respect of, its outstanding
shares of capital stock pending consummation of the Reorganization.

Post-Reorganization Dividend Policy. It is the current intention of
the Board of Directors of Wintrust to declare cash dividends on the Wintrust
Common Stock following the Reorganization. Shareholders should note that no
such dividends have previously been declared and that all future dividends will
be determined by the Wintrust Board of Directors in light of earnings and
financial condition of Wintrust and its subsidiaries and other factors,
including applicable governmental regulations and policies. In that regard,
Wintrust is a separate and distinct entity from its banking and non-banking
subsidiaries, and the principal sources of Wintrust's income are dividends and
interest from such subsidiaries. Payments of dividends by Wintrust's banking
subsidiaries are subject to certain restrictions under applicable governmental
regulations. See "RISK FACTORS AND CERTAIN OTHER CONSIDERATIONS -- Regulatory
Restrictions on Dividends."

REPORTS TO SHAREHOLDERS

After the Effective Date, Wintrust will become subject to the periodic
financial reporting requirements of the Securities and Exchange Act of 1934
(the "Exchange Act"), including but not limited to filing with the Securities
and Exchange Commission annual reports on Form 10-K within 90 days of year-end,
quarterly reports on Form 10-Q within 45 days of the quarter end, and other
current reports on Form 8-K. It is anticipated that Wintrust shareholders will
begin receiving quarterly and annual reports after the close of the 1996 third
quarter. Neither Wintrust nor any of the Companies has ever been previously
subject to the Exchange Act.

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67

PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

The following Unaudited Pro Forma Condensed Combined Statement of
Condition as of March 31, 1996 combines the historical consolidated statements
of condition of each of the Companies as if the Reorganization had occurred on
that date after giving effect to pro forma adjustments described in the
accompanying notes.

Also presented are the Pro Forma Condensed Combined Statements of
Operations for the three-month period ended March 31, 1996, and the years ended
December 31, 1995, 1994 and 1993, giving effect to the Reorganization as if it
had been consummated at the beginning of the earliest period presented. The
pro forma information is based on the historical consolidated financial
statements of the Companies presented elsewhere herein, giving effect to the
proposed transaction under the "pooling-of-interests" method and on the
assumptions and adjustments set forth in the accompanying notes to the pro
forma condensed consolidated financial statements. These pro forma statements
may not be indicative of the results of operations that actually would have
occurred if the Reorganization had been consummated on the date indicated or
which may occur in the future.

The Unaudited Pro Forma Condensed Combined Financial Information
should be read in conjunction with the separate historical consolidated
financial statements and related footnotes of each of the Companies.

68
PRO FORMA CONDENSED COMBINED STATEMENT OF CONDITION
(UNAUDITED)

MARCH 31, 1996
-------------------------------------------------------------------
NORTH SHORE LAKE
COMMUNITY FOREST HINSDALE LIBERTYVILLE CRABTREE
BANCORP BANCORP, BANCORP, BANCORP, CAPITAL
INC. INC. INC. INC. CORP.
----------- -------- -------- ------------ ---------
(in thousands)

ASSETS
Cash and demand balance due from banks . . . . . $ 3,739 $ 4,291 $ 1,612 $ 642 $ 585
Money market assets:
Interest-bearing deposits at banks . . . . . . 10,000 100 -- 9,000 --
Federal funds sold . . . . . . . . . . . . . . 8,875 18,155 10,221 11,285 --
Investment securities . . . . . . . . . . . . . . 12,054 62,467 32,440 4,588 --
Loans . . . . . . . . . . . . . . . . . . . . . . 74,338 121,055 67,505 22,311 14,564
Less: allowance for possible loan losses . . 510 950 583 130 788
-------- -------- -------- ------- -------
Loans, net . . . . . . . . . . . . . . . . . . . 73,828 120,105 66,922 22,181 13,776
Premises and equipment, net . . . . . . . . . . . 7,107 8,098 5,085 4,064 1,007
Goodwill and organization costs . . . . . . . . . 288 44 76 101 --
Other assets . . . . . . . . . . . . . . . . . . 2,047 2,390 2,189 681 2,796
-------- -------- -------- ------- -------
Total assets . . . . . . . . . . . . . . . . . . $117,938 $216,350 $118,545 $52,542 $18,164
======== ======== ======== ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing . . . . . . . . . . . . . 12,569 17,094 10,471 7,282 --
Interest-bearing . . . . . . . . . . . . . . . 93,671 182,927 95,921 35,293 --
-------- -------- -------- ------- -------
Total deposits . . . . . . . . . . . . . . . . . 106,240 200,021 106,392 42,575 --
Accrued interest and other expenses . . . . . . . 291 1,282 577 219 8,895
Notes and loans payable . . . . . . . . . . . . . -- 3,952 1,800 361 4,400
Subordinated notes payable . . . . . . . . . . . -- -- -- -- 1,999
-------- -------- -------- ------- -------
Total liabilities . . . . . . . . . . . . . . . . 106,531 205,255 108,769 43,155 15,294
-------- -------- -------- ------- -------
Minority interest . . . . . . . . . . . . . . . . -- -- -- -- 212

Stockholders' equity
Common stock . . . . . . . . . . . . . . . . . 254 161 207 206 1,032
Convertible warrants . . . . . . . . . . . . . 25 -- 25 25 --
Convertible preferred stock . . . . . . . . . -- 3 -- 500 --
Surplus . . . . . . . . . . . . . . . . . . . 12,161 9,549 9,506 8,994 17,971
Undivided profit (deficit) . . . . . . . . . . (1,032) 1,185 19 (338) (16,180)
Less: Treasury shares . . . . . . . . . . . . -- -- -- -- (165)
Net unrealized gain (loss) -- securities
available-for-sale, net of tax . . . . . . . (1) 197 19 -- --
-------- -------- -------- ------- -------
Total stockholders' equity . . . . . . . . . . . 11,407 11,095 9,776 9,387 2,658
-------- -------- -------- ------- -------
Total liabilities and stockholders'
equity . . . . . . . . . . . . . . . . . . . . . $117,938 $216,350 $118,545 $52,542 $18,164
======== ======== ======== ======= =======

MARCH 31, 1996
------------------------------------------------------
PROFORMA ADJUSTMENTS
-------------------- COMBINED
DEBIT CREDIT PROFORMA
----------- -------------- --------
(in thousands)

ASSETS
Cash and demand balance due from banks . . . . . $ 541 (D) $11,410
Money market assets:
Interest-bearing deposits at banks . . . . . . 19,100
Federal funds sold . . . . . . . . . . . . . . 49,236
Investment securities . . . . . . . . . . . . . . $ 3,375 (A) 108,174
Loans . . . . . . . . . . . . . . . . . . . . . . 299,773
Less: allowance for possible loan losses . . 2,961
--------
Loans, net . . . . . . . . . . . . . . . . . . . 296,812
Premises and equipment, net . . . . . . . . . . . 25,361
Goodwill and organization costs . . . . . . . . . 509
Other assets . . . . . . . . . . . . . . . . . . 10,103
--------
Total assets . . . . . . . . . . . . . . . . . . $520,705
========

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing . . . . . . . . . . . . . 47,416
Interest-bearing . . . . . . . . . . . . . . . 407,812
--------
Total deposits . . . . . . . . . . . . . . . . . 455,228
Accrued interest and other expenses . . . . . . . 106 (A) 11,158
Notes and loans payable . . . . . . . . . . . . . 10,513
Subordinated notes payable . . . . . . . . . . . 499 (D) 1,500
--------
Total liabilities . . . . . . . . . . . . . . . . 478,399
--------
Minority interest . . . . . . . . . . . . . . . . 212 (D) 50 (E) 50

Stockholders' equity
Common stock . . . . . . . . . . . . . . . . . 1,656 (A)(B)(E) 6,225 (C)(D)(E) 6,429
Convertible warrants . . . . . . . . . . . . . 50 (E) 25
Convertible preferred stock . . . . . . . . . 503 (C) --
Surplus . . . . . . . . . . . . . . . . . . . 50,455 (A)(B)(E) 44,414 (C)(D)(E) 52,140
Undivided profit (deficit) . . . . . . . . . . (16,346)
Less: Treasury shares . . . . . . . . . . . . 165 (B) --
Net unrealized gain (loss) -- securities
available-for-sale, net of tax . . . . . . . 207 (A) 8
------- --------
Total stockholders' equity . . . . . . . . . . . 42,256
Total liabilities and stockholders' --------
equity . . . . . . . . . . . . . . . . . . . . . $54,229 $54,229 $520,705
======= ======= ========

See accompanying notes to condensed pro forma combined financial statements.

56
69

PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS (UNAUDITED)

Three Months Ended March 31, 1996
------------------------------------------------------------------------------------------------
North Shore Crabtree
Community Lake Forest Hinsdale Libertyville Capital Pro Forma
Bancorp, Bancorp, Bancorp, Bancorp, Corporation Adjustments
Inc. and Inc. and Inc. and Inc. and and ------------- Pro Forma
Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Debit Credit Combined
------------ ------------ ------------ ------------ ------------ ------ ------ ---------
(in thousands, except per share data)

Total interest income . . . . . . $1,804 $3,445 $1,999 $ 645 $ 394 $8,287
Total interest expense . . . . . . 1,114 2,200 1,295 416 182 $ 7 5,200
------ ------ ------ ------ ------ ------
Net interest income . . . . . . . 690 1,245 704 229 212 3,087
Provision for loan losses . . . . 79 110 104 75 42 410
------ ------ ------ ------ ------ ------
Net interest income after
provision for loan losses . . . . 611 1,135 600 154 170 2,677
Gain on sale of receivables . . . -- -- -- -- 967 967
Total noninterest income . . . . . 149 258 230 57 353 $44 1,003
Total noninterest expense . . . . 997 1,133 762 546 1,520 26 4,932
------ ------ ------ ------ ------ ------
Net income before income taxes . . $ (237) 260 68 (335) (30) (285)
Income tax expense . . . . . . . -- 82 -- -- -- 82
------ ------ ------ ------ ------ ---- ---- ------
Net income (loss) $ (237) $ 178 $ 68 $ (335) $ (30) $44 $33 $ (367)
====== ====== ====== ====== ====== ==== ==== ======
Average number of common
shares outstanding . . . . . . . 250 176 219 204 1,025 6,695

Net income (loss) per share
from continuing operations . . . $(0.95) $ 1.01 $ 0.31 $(1.64) $(0.03) $(0.05)
====== ====== ====== ====== ====== ======
Net income (loss) per share . . . $(0.95) $ 1.01 $ 0.31 $(1.64) $(0.03) $(0.05)
====== ====== ====== ====== ====== ======

Year Ended December 31, 1995
-----------------------------------------------------------------------------------------------
North Shore Crabtree
Community Lake Forest Hinsdale Libertyville Capital Pro Forma
Bancorp, Bancorp, Bancorp, Bancorp, Corporation Adjustments
Inc. and Inc. and Inc. and Inc. and and ------------- Pro Forma
Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Debit Credit Combined
------------ ------------ ------------ ------------ ------------ ------ ------ ----------
(in thousands, except per share data)

Total interest income . . . . . . $ 4,587 $12,180 $ 5,837 $ 321 $ 2,547 $25,472
Total interest expense . . . . . . 2,841 7,749 3,770 164 1,336 $ 29 15,831
------- ------- ------- ------- -------- -------
Net interest income . . . . . . . 1,746 4,431 2,067 157 1,211 9,641
Provision for loan losses . . . . 428 301 299 55 347 1,430
------- ------- ------- ------- -------- -------
Net interest income after
provision for loan losses . . . 1,318 4,130 1,768 102 864 8,211
Gain on sale of receivables . . . -- -- -- -- 4,421 4,421
Total noninterest income . . . . . 264 1,115 572 21 2,151 $85 4,038
Total noninterest expense . . . . 2,444 4,402 2,260 1,081 5,537 85 15,639
------- ------- ------- ------- -------- -------
Net income before income taxes . . (862) 843 80 (958) 1,899 1,031
Income tax (benefit) expense . . . -- (172) (340) -- -- (512)
------- ------- ------- ------- -------- -------
Net income (loss) from
continuing operations . . . . . . (862) 1,015 420 (958) 1,899 1,543
Loss from operations of
discontinued subsidiaries,
net of minority interest of $75 . -- -- -- -- (17) (17)
------- ------- ------- ------- -------- ---- ----- -------
Net income (loss) . . . . . . . . $ (862) $1,015 $ 420 $ (958) $ 1,882 $85 $ 114 $ 1,526
======= ======= ======= ======= ======== ==== ===== =======

Average number of common shares
outstanding . . . . . . . . . . 201 171 206 68 1,025 5,799
Net income (loss) per share
from continuing operations . . . $ (4.29) $ 5.95 $ 2.04 $(14.19) $ 1.85 $ 0.27
======= ======= ======= ======= ======== =======
Net income (loss) per share . . . $ (4.29) $ 5.95 $ 2.04 $(14.19) $ 1.83 $ 0.26
======= ======= ======= ======= ======== =======

See accompanying notes to condensed pro forma combined financial statements.

57
70

PRO FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS (UNAUDITED) (CONTINUED)

Year Ended December 31, 1994
-----------------------------------------------------------------------------------------------
North Shore Crabtree
Community Lake Forest Hinsdale Libertyville Capital Pro Forma
Bancorp, Bancorp, Bancorp, Bancorp, Corporation Adjustments
Inc. and Inc. and Inc. and Inc. and and ------------- Pro Forma
Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Debit Credit Combined
------------ ------------ ------------ ------------ ------------ ------ ------ ----------
(in thousands, except per share data)

Total interest income . . . . . . $ 460 $6,708 $ 2,305 $ -- $ 8,271 $17,744
Total interest expense . . . . . 276 3,831 1,732 -- 4,769 $27 10,581
------- ------ ------ ---- -------- -------
Net interest income . . . . . . . 184 2,877 573 -- 3,502 7,163
Provision for loan losses . . . . 50 240 180 -- 137 607
------- ------ ------ ---- -------- -------
Net interest income after
provision for loan losses . . . . 134 2,637 393 -- 3,365 6,556
Gain on sale of receivables . . . -- -- -- -- -- --
Total noninterest income . . . . . 36 649 237 -- 564 $ 50 1,436
Total noninterest expense . . . . 1,066 2,778 1,523 -- 4,648 50 9,965
------- ------ ------ ---- -------- -------
Net income (loss) from
continuing operations
before income taxes . . . . . . . (896) 508 (893) -- (719) (1,973)
Income tax (benefit) expense . . . -- -- -- -- -- --
------- ------ ------ ---- -------- -------
Net income (loss) from
continuing operations . . . . . (896) 508 (893) -- (719) (1,973)
Loss from operations of
discontinued subsidiaries, net
of minority interest of $180 . . -- -- -- -- (236) (236)
------- ------ ------ ---- -------- ---- ---- -------
Net income (loss)
from continuing operations . . . $ (896) $ 508 $ (893) $ -- $ (955) $ 50 $ 77 $(2,209)
======= ====== ====== ==== ======== ==== ==== =======

Average number of common shares
outstanding . . . . . . . . . . 73 167 146 -- 1,025 4,483
Net income (loss) per share
from continuing operations . . . $(12.26) $ 3.05 $(6.11) -- $ (0.70) $ (0.44)
======= ====== ====== ==== ======== =======
Net income (loss) per share . . . $(12.26) $ 3.05 $(6.11) $ -- $ (0.93) $ (0.49)
======= ====== ====== ==== ======== =======

Year Ended December 31, 1993
-----------------------------------------------------------------------------------------------
North Shore Crabtree
Community Lake Forest Hinsdale Libertyville Capital Pro Forma
Bancorp, Bancorp, Bancorp, Bancorp, Corporation Adjustments
Inc. and Inc. and Inc. and Inc. and and ------------- Pro Forma
Subsidiaries Subsidiaries Subsidiaries Subsidiaries Subsidiaries Debit Credit Combined
------------ ------------ ------------ ------------ ------------ ------ ------ ----------
(in thousands, except per share data)

Total interest income. . . . . . . $ -- $ 3,743 $ 73 $ -- $ 4,423 $ 8,239
Total interest expense . . . . . . -- 1,939 66 -- 2,321 $ 26 4,300
---- -------- ------- ---- -------- -------
Net interest income . . . . . . . -- 1,804 7 -- 2,102 3,939
Provision for loan losses . . . . -- 240 -- -- 887 1,127
---- -------- ------- ---- -------- -------
Net interest income after
provision for loan losses . . . . -- 1,564 7 -- 1,215 2,812
Gain on sale of receivables . . . -- -- -- -- -- --
Total noninterest income . . . . . -- 783 43 -- 318 $ 40 1,104
Total noninterest expense . . . . -- 2,147 615 -- 4,314 40 7,036
---- -------- ------- ---- -------- -------
Net income (loss) from continuing
operations before income taxes. . -- 200 (565) -- (2,781) (3,120)
Income tax (benefit) expense . . . -- -- -- -- -- --
---- -------- ------- ---- -------- -------
Net income (loss) from continuing
operations . . . . . . . . . . . -- 200 (565) -- (2,781) (3,120)
Loss from operations of
discontinued subsidiaries, net
of minority interest of $112. . . -- -- -- -- (193) (193)
---- -------- ------- ---- -------- ---- ---- -------
Net income (loss) . . . . . . . . $ -- $ 200 $ (565) $ -- $ (2,974) $ 40 $ 66 $(3,313)
==== ======== ======= ==== ======== ==== ==== =======
Average number of common shares
outstanding . . . . . . . . . . -- 152 45 -- 1,025 3,354
Net income (loss) per share
from continuing operations . . . -- $ 1.32 $(12.55) -- $ (2.71) $ (0.93)
==== ======== ======= ==== ======== =======
Net income (loss) per share . . . $ -- $ 1.32 $(12.55) $ -- $ (2.90) $ (0.99)
==== ======== ======= ==== ======== =======

See accompanying notes to condensed pro forma combined financial statements.

58
71

NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION (UNAUDITED)

Note 1. Basis of Presentation

The unaudited pro forma financial information does not give effect to
any synergies that are expected to occur due to the integration of the North
Shore, Lake Forest, Hinsdale, Libertyville and Crabtree operations.
Additionally, the unaudited pro forma financial information excludes the
transaction costs of the Reorganization and the nonrecurring costs and expenses
associated with integrating the operations of the businesses. The impact of
the majority of the transaction costs of the Reorganization, and the
nonrecurring costs and expenses associated with integrating the operations is
expected to be recorded in the second quarter of 1996.

The merger will be accounted for under the "pooling-of-interests"
method. Accordingly, recorded assets and liabilities are carried forward to
the combined company at their historical values.

Note 2. Pro Forma Condensed Combined Statement of Condition Adjustments

A. Elimination of Intercompany Shares

Each of Lake Forest, North Shore, Hinsdale and Libertyville own shares
in one or more of the other Companies. The Reorganization Agreement provides
that such shares will be retired at the Effective Date of the Reorganization
and, thus, will not be outstanding at or subsequent to the date of the
Reorganization. This entry reflects such shares as being retired as Treasury
shares.

B. Elimination of Treasury Shares of Crabtree Capital Corporation

Crabtree has 7,000 shares of Treasury Stock that have a carrying value
of $164,500. This entry eliminates the Treasury Stock against the Common Stock
and paid-in capital of Crabtree.

C. Conversion of Preferred Shares into Common Shares

Lake Forest has 1,700 shares of preferred stock outstanding that are
convertible into 2,550 shares of common stock. Libertyville has 24,000 shares
of preferred stock outstanding that are convertible into 24,000 shares of
common stock. This entry assumes the preferred shares are converted to common
shares prior to the Effective Date of the Reorganization as contemplated by the
Reorganization Agreement.

D. Conversion and Exercise of First Premium Warrants

The pro forma condensed combined financial information assumes that a
portion of the outstanding warrants at First Premium -- which are to be
converted under the terms of the Reorganization Agreement so as to represent
the right to acquire, or are to be exercised for shares to be exchanged for, an
aggregate of 477,740 shares of Wintrust Common Stock -- will be exercised and
exchanged for 399,612 shares of Wintrust Common Stock and that the remaining
warrants will convert into warrants to purchase 48,128 shares of Wintrust
Common Stock. In conjunction with the conversion of the warrants into Common
Stock, a portion of the proceeds received from the warrant holders to exercise
such warrants is assumed to retire the subordinated debt of First Premium
because the holder of certain warrants is also the owner of the subordinated
debt.

E. Shareholders' Equity

The combined equity accounts of Wintrust reflect the combination of
the equity accounts for North Shore, Lake Forest, Hinsdale, Libertyville and
Crabtree. Shares of common stock are presented on the basis of a stated value
of $1.00 per share. Based on the Exchange Ratios, and assuming no exercise of
options, rights or warrants

59
72

(except the partial exercise of First Premium warrants as described above), the
following shares of Wintrust Common Stock will be issued to holders of the
respective Companies' common stock and will be outstanding:

WINTRUST
SHARES
TO BE ISSUED
EXCHANGE RATIO AND OUTSTANDING
-------------- ---------------

North Shore Community Bancorp, Inc. . . . . . 5.16180 1,189,841
Lake Forest Bancorp, Inc. . . . . . . . . . . 9.67334 1,580,237
Hinsdale Bancorp, Inc. . . . . . . . . . . . 6.03398 1,196,508
Libertyville Bancorp, Inc. . . . . . . . . . 4.02578 848,840
Crabtree Capital Corporation . . . . . . . . 1.18332 1,213,217
Converted First Premium Warrants . . . . . . 399,612
----------
Total Wintrust Shares . . . . . . . . . . . 6,428,255
==========

The average number of shares of common stock shown to be outstanding
during the periods presented in the Pro Forma Condensed Combined Statements of
Operations includes 339,612 shares under the assumption that a portion of the
First Premium warrants would be converted to Common Stock of Wintrust in
accordance with the terms of the Reorganization Agreement.

Also, the Pro Forma Statement of Condition assumes that no
shareholders of the Companies dissent to the transaction and exercise appraisal
rights and that fractional shares issued upon consummation of the
Reorganization will be immaterial.

Note 3. Pro Forma Condensed Combined Statements of Operations Adjustments

F. Reflects the elimination from noninterest expense of
intercompany fees charged by Lake Forest to (1) Hinsdale in 1993 of $40,000;
(2) North Shore in 1994 of $50,000; and (3) Libertyville in 1995 of $50,000.

G. Reflects the elimination from noninterest expense of an
aggregate of $26,000 and $35,000 of fees charged by Hinsdale Bank to Lake
Forest Bank, North Shore Bank and Libertyville Bank for services performed in
servicing a portfolio of indirect automobile loans for the three months ended
March 31, 1996 and the year ended December 31, 1995, respectively. Such fees
were only applicable in 1995 and the first quarter of 1996.

H. Reflects the elimination from noninterest income of an $18,000
gain on the sale of shares of Hinsdale Common Stock by Lake Forest in the first
quarter of 1996.

I. Reflects the reduction of interest expense associated with the
elimination of the subordinated debt at First Premium as discussed above in
Note D. Interest expense has been reduced by $7,413 for the three months ended
March 31, 1996, and $28,565, $26,906 and $26,232 for the years ended December
31, 1995, 1994 and 1993, respectively.

60
73
NORTH SHORE COMMUNITY BANCORP, INC.

BUSINESS

Organization and Operation. North Shore Community Bancorp, Inc.
("North Shore") is a bank holding company that was incorporated by an Illinois
corporation in December of 1992. The primary asset of North Shore is its
ownership of 100% of the common shares of North Shore Bank. North Shore is
engaged in the business of banking through its ownership of North Shore Bank.
Its mailing address is 1145 Wilmette Avenue, Wilmette, Illinois 60091 and its
telephone number is (847) 853-1145. As of March 31, 1996, North Shore had total
assets of $117,938,000 and total stockholders' equity of $11,407,000.

North Shore Bank was organized under the laws of the State of Illinois
and commenced operation in October, 1993. North Shore and North Shore Bank are
regulated by the Federal Reserve Bank. Additionally, North Shore Bank is
regulated by the [Illinois Commissioner of Banks and Trust Companies ("CBTC")]
and the Federal Deposit Insurance Corporation ("FDIC").

North Shore Bank is the only locally owned and managed full service
commercial bank in its primary service area of Wilmette, Glencoe, Winnetka and
Kenilworth, Illinois. The Village of Wilmette is located approximately 17 miles
north of the downtown Chicago area and has a population of approximately
28,000. The Villages of Glencoe and Winnetka are located north of Wilmette and
house the full service branch banking facilities. Glencoe and Winnetka have
populations of approximately 12,000 and 16,000, respectively. Kenilworth,
Illinois is an adjacent community which North Shore Bank serves and has a
population of approximately 3,500 residents.

Employees. As of March 31, 1996, North Shore Bank employed 46
full-time equivalent employees. North Shore has no paid employees.

Services. North Shore Bank is an Illinois chartered, FDIC-insured
commercial bank which provides the full range of banking services. North Shore
Bank furnishes personal and commercial banking services, including demand, NOW,
money market, savings, and time deposit accounts; real estate, commercial, and
consumer loans; and safe deposit facilities. North Shore Bank anticipates
adding trust services during late 1996 or early 1997.

North Shore Bank was formed to provide the Wilmette and Kenilworth
communities with a community bank alternative. As North Shore Bank showed
strong growth in those communities, the services were extended to Glencoe and
Winnetka. As such, North Shore Bank is focused on providing a highly personal,
professional level of service to commercial and retail customers residing in
these areas. Emphasis is placed on local ownership and management in attracting
and maintaining deposit, loan and trust customers.

Property. North Shore Bank currently has four physical banking
locations. North Shore Bank owns the main bank facility that is a one story
brick building located at 1145 Wilmette Avenue in downtown Wilmette, Illinois.
North Shore Bank constructed a 9,600 square foot drive-in, walk-up banking
facility at 720 12th Street, approximately one block west of the main banking
facility. North Shore Bank also opened a full service banking facility at 362
Park Avenue in Glencoe, Illinois. Additionally, during May, 1996, North Shore
Bank opened a branch banking facility in Winnetka, Illinois where it leases
approximately 4,000 square feet. North Shore Bank maintains automated teller
machines at each of its locations, except Glencoe and Winnetka. North Shore
Bank has no offsite automated teller machines.

ADDITIONAL INFORMATION

For a description of North Shore's and North Shore Bank's competition,
litigation, regulatory environment, interests in affiliates, transactions with
management and relationship with independent public accountants, see "MATTERS
OF GENERAL APPLICABILITY TO BANKS."

61
74

MANAGEMENT OWNERSHIP OF COMMON STOCK

The following table sets forth information as of March 31, 1996, with
respect to beneficial ownership of shares of North Shore Common Stock held by
(i) each director of North Shore, (ii) each executive officer of North Shore,
and (iii) all directors and executive officers as a group.

Shares Shares Shares Total
Subject to Subject to Subject to North % of Pro Forma
Common Common Vested Shore North % of
Common Stock Stock Stock Beneficial Shore Wintrust
Shares Rights Warrants Options Ownership Total(2) Total(2)(3)
------------ ----------- ---------------------- ----------- ----------- ------------

DIRECTORS
- ---------
Howard D. Adams ** . . . . . . . . 6,368 -- -- -- 6,368 2.51% 7.56%
Gilbert W. Bowen . . . . . . . . . 265 -- -- 24 289 * *
T. Tolbert Chisum ** . . . . . . . 3,355 449 85 704 4,593 1.80% *
John W. Close ** . . . . . . . . . 5,226 1,681 -- 1,250 8,157 3.18% *
Joseph DeVivo, Jr. . . . . . . . . 1,721 449 125 192 2,487 * *
Maurice F. Dunne, Jr. . . . . . . . 2,241 449 -- 192 2,882 1.13% *
Gayle Inbinder . . . . . . . . . . 641 449 50 228 1,368 * *
Thomas J. McCabe, Sr. . . . . . . . 541 449 -- 216 1,206 * *
Marguerite Savard McKenna . . . . . 2,435 449 50 228 3,162 1.24% *
Donald L. Olson . . . . . . . . . . 1,232 449 25 228 1,934 * *
Hollis Rademacher . . . . . . . . . 2,541 449 -- 204 3,194 1.26% *
John J. Schornack . . . . . . . . . 1,311 449 -- 192 1,952 * *
Ingrid S. Stafford . . . . . . . . 571 449 25 204 1,249 * *
Lemuel H. Tate . . . . . . . . . . 1,907 1,121 85 -- 3,113 1.22% *
Edward J. Wehmer ** . . . . . . . . 4,796 2,943 1,250 -- 8,989 3.48% 3.20%
Stanley R. Weinberger . . . . . . . 1,400 -- -- 48 1,448 * *
Elizabeth C. Warren . . . . . . . . -- -- -- 48 48 * *
------- ------ ----- ----- ------- -----
Total Directors . . . . . . . . 36,551 10,235 1,695 3,958 52,439 20.53%

NON-DIRECTOR EXECUTIVE OFFICERS
- -------------------------------
Lloyd M. Bowden . . . . . . . . . . 667 -- -- -- 667 * *
David A. Dykstra . . . . . . . . . 175 -- -- -- 175 * *
Randolph Hibben . . . . . . . . . . 500 -- -- -- 500 * *
Robert F. Key . . . . . . . . . . . 600 -- -- -- 600 * *
Donald F. Krueger . . . . . . . . . 1,100 224 -- 250 1,574 * *
Brian V. Masterton . . . . . . . . 1,400 -- -- -- 1,400 * *
Robert H. Meeder . . . . . . . . . 1,901 840 -- 500 3,241 1.27% *
------- ------ ----- ----- ------- -----

Total Directors and Executive
Officers as a group 42,894 11,299 1,695 4,708 60,596 23.74%
======= ====== ===== ===== ====== =====

Total Common Share
Equivalents . . . . . . . . . . . 253,809 20,000 5,000 5,400 284,209
======= ====== ===== ===== ======= =====

- ----------
* -- Less than 1%
** -- Denotes executive officer (in addition to director status)

(1) Includes shares held directly and, if applicable, indirectly through such
person's spouse, minor children, certain family trusts, IRA's 401(k)
plans.

(2) Beneficial ownership percentages are calculated in accordance with SEC Rule
13d-3 promulgated under the Securities Exchange Act of 1934.

62
75

BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS

On March 31, 1996, North Shore had 253,809 shares of common stock
outstanding. As of such date, the following persons not listed under
"Management Ownership of Common Stock" are known by North Shore to be the
owners of or might be deemed to be the beneficial owners of more than 5% of its
common stock.

Number of Shares Percent of
Name Address Beneficially Owned Class(1)
----------------------------------- ------------------ --------------------- -----------

Milbank Corporation(2) 135 South LaSalle 15,600 6.15%
Chicago, Illinois
Emmett D. McCarthy, as trustee
for(3):
Alan W. Adams Family Trust 570 Crabtree Lane 18,364 7.12%
Sarah K. Adams Family Trust Lake Forest, Illinois

- ---------------------

(1) Beneficial ownership percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.

(2) Larry Wright, a director of Crabtree, and Robert D. Harnach, a director
of Lake Forest and Hinsdale, are officers, directors and principal
shareholders of Milbank Corporation ("Milbank"). The beneficial ownership
shown in the table includes 600 shares held by an employee retirement
plan of Milbank of which Mr. Wright and Mr. Harnach are trustees with
shared voting and investment power, and 15,000 shares held in Deerpath
Investments LLP, a limited partnership to which Milbank serves as
investment advisor and with respect to which Mr. Wright and Mr. Harnach
exercise shared voting and investment power.

(3) The Alan W. Adams Family Trust and the Sarah K. Adams Family Trust are
irrevocable trusts for which Emmett McCarthy and either Alan W. Adams or
Sarah K. Adams, respectively, serve as co-trustees. Mr. McCarthy is a
Director of Crabtree. Of the total shares beneficially owned by the two
Trusts, each Trust owns 5,130 shares of North Shore Common Stock, rights
to acquire 3,427 shares of North Shore Common Stock, and warrants to
acquire 625 shares of North Shore Common Stock. The beneficiaries of the
respective Trusts are Alan W. Adams and Sara K. Adams, respectively,
adult children of Howard D. Adams, and Mr. McCarthy disclaims beneficial
ownership of all such shares. Mr. Alan W. Adams is currently a vice
president of Lake Forest Bank and a Director nominee of Wintrust and
directly owns an additional 220 shares.

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SELECTED FINANCIAL DATA
NORTH SHORE COMMUNITY BANCORP, INC.

Three Months Year Ended Period Ended
Ended March 31, December 31, December 31,
------------------------------ -------------- ---------------
1996 1995 1995 1994(1)
-------------- --------------- -------------- ---------------
(dollars in thousands)

Interest income . . . . . . . . . . . . . . . . $ 1,804 $ 787 $ 4,587 $ 460
Interest expense . . . . . . . . . . . . . . . 1,114 507 2,841 276
-------- -------- -------- -------
Net interest income . . . . . . . . . . . . . . 690 280 1,746 184
Provision for possible loan losses . . . . . . 79 60 428 50
-------- -------- -------- -------
Net interest income after provision for
possible loan losses . . . . . . . . . . . . 611 220 1,318 134
Noninterest income, excluding security gains. . 149 26 264 36
Security gains . . . . . . . . . . . . . . . . 0 0 0 0
Noninterest expense . . . . . . . . . . . . . . 997 450 2,444 1,066
-------- -------- -------- -------
Net loss before income taxes . . . . . . . . . (237) (204) (862) (896)
Income taxes . . . . . . . . . . . . . . . . . 0 0 0 0
-------- -------- -------- -------
Net loss . . . . . . . . . . . . . . . . . . . $ (237) $ (204) $ (862) $ (896)
======== ======== ======== =======

Net loss per common share . . . . . . . . . . . $ (0.95) $ (1.04) $ (4.29) $(12.26)
Cash dividends declared per common share . . . $ 0 $ 0 $ 0 $ 0

Total assets at end of period . . . . . . . . . $117,938 $ 59,544 $105,122 $45,164
Total deposits at end of period . . . . . . . . $106,240 $ 51,367 $ 93,657 $36,736

Return on average total assets . . . . . . . . (0.86%) (1.53%) (1.23%) __(2)
Return on average common
shareholders' equity . . . . . . . . . . . (8.43%) (10.04%) (10.44%) __(2)

- -------------------
(1) Management has for this period presented selected financial data
reflecting reported results from the date of incorporation (December
30, 1992) to December 31, 1994. The Company was in a capital raising
and organizational phase and as described elsewhere herein was only
operational from September 14, 1994 through December 31, 1994.
Accordingly, management believes that separate selected financial data
from the date of incorporation to December 31, 1993 and for January 1,
1994 to December 31, 1994 is not meaningful as the period presented
herein approximates those revenues and expenses that would have been
recognized had 1994 been presented on a stand-alone calendar year
basis.

(2) Return on average assets and average equity ratios are not meaningful
as a result of the nature as discussed in Note 1 above.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

General. North Shore completed its first full year of operations in
1995. During that time period, North Shore has conducted no business other
than that directly related to North Shore Bank. North Shore's results of
operations are primarily dependent on North Shore Bank's net interest income,
which is the difference between interest income on interest-earning assets and
interest expense on interest bearing liabilities. In addition, to a lesser
extent, North Shore Bank's operating results are affected by fees paid by
borrowers, fees earned on residential mortgage loans sold to the secondary
market, customer service charges and other income. Also, noninterest expenses
such as employee salaries and benefits, office occupancy, marketing, insurance
costs and other expenses affect the results of operations.

Operational results are also affected by general economic conditions
(particularly changes in interest rates), competition, government policies and
actions of regulatory agencies.

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77
RESULTS OF OPERATIONS

Comparison of Results for the Period Ended March 31, 1996 to the Period Ended
March 31, 1995

The net loss for the three-month period ended March 31, 1996 was
$237,000 compared to a net loss for the three-month period ended March 31, 1995
of $204,000. The following discussion will discuss the components of the net
losses and the change between the respective three-month periods.

Net interest income increased to $690,000 for the three months ended
March 31, 1996 from approximately $280,000 for the same period of 1995. This
increase is a result of a 89.7% increase in interest earning assets at March
31, 1996 compared to March 31, 1995 and the fact that the mix of
interest-earning assets has gradually shifted more into higher yielding loans
from short-term money market investment products. Management anticipates that
the net interest income amount will continue to grow in the remaining quarters
of 1996 due to the continuation of the growth in earning assets, specifically
the loan category.

The provision for possible loan losses increased to $79,000 for the
three months ended March 31, 1996 compared to $60,000 for the prior year
three-month period. North Shore Bank has provided a higher amount to the
allowance for possible loan losses during the first quarter of 1996 because of
the growth in the loan portfolio. Management considers it prudent to continue
to build a reserve for unanticipated credit problems that may occur with the
existing portfolio despite a low level of actual charge-offs since the
inception of North Shore Bank. The allowance for loan losses as a percentage
of total loans outstanding stood at 0.69% at March 31, 1996 and December 31,
1995, and 0.64% as of March 31, 1995. Management considers the amount of the
provision and the level of the allowance for loan losses to be adequate for the
period ended and as of March 31, 1996.

Other noninterest income totaled $149,000 for the three months ended
March 31, 1996 compared to approximately $26,000 for the three months ended
March 31, 1995. The increase is predominantly related to fees on fixed rate
residential mortgage loans which were sold to the secondary market. During
1995, this activity was just underway as North Shore Bank entered its second
full quarter of operations and customer relationships were being established,
whereas in 1996, the service has become an established function at North Shore
Bank and has generated the additional revenues. Fees on loans sold during the
first quarter of 1996 were approximately $117,000 compared to only $16,000
during the first quarter of 1995.

Other noninterest expenses were $997,000 and $450,000 for the
three-month periods ended March 31, 1996 and March 31, 1995, respectively. The
major components of the other noninterest expenses for the respective
three-month periods are as follows (in thousands):

Three Months Ended March 31,
----------------------------------
1996 1995
----------------- --------------

Salaries and employee benefits . . . . $523 $218
Occupancy expense . . . . . . . . . . . 73 21
Other noninterest expenses . . . . . . 401 211
---- ----
Total other noninterest expenses . . . $997 $450
==== ====

The substantial increase in each of the other noninterest expense
categories for the three-month periods presented in the table above is
primarily a result of the three banking locations that were operational and the
one additional banking location that was in the organizational phase in the
first quarter of 1996, compared to only one main banking location during the
first quarter of 1995. During the fourth quarter of 1995, the North Shore Bank
opened a walk-up/drive-through banking location in Wilmette and opened a full
service banking location in Glencoe, Illinois. Also during the fourth quarter
of 1995 and into the first quarter of 1996, North Shore Bank began the process
of building a staff, renovating a building and accumulating furniture and
supplies to open a full service banking facility in Winnetka, Illinois. As a
result, the other noninterest expense categories increased significantly.

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78

Comparison of Results for the Year Ended December 31, 1995 and Period Ended
December 31, 1994

General. North Shore had a net loss of $862,000 for the year ended
December 31, 1995, compared with a net loss of $896,000 for the period ended
December 31, 1994. The increase in net loss was due primarily to the fact that
1995 was North Shore's first full year of operations. The company began to
organize its banking operations in 1994 and ultimately became operational in
September of 1994. Consequently, the 1994 period included only slightly over
three months of actual operations and revenue generation; however, a
significant amount of expenditures were incurred during the organizational and
start-up phases of operations. It is typical for a new bank to incur operating
losses during its first few years of operation due to the overhead
infrastructure required to house and staff a banking facility. As the bank is
able to grow its deposit base and deploy those funds into interest earning
assets, the net interest income earned should generally grow to support the
overhead expenses and provide a profit. Accordingly, the increase in the net
loss was anticipated by management due to the start-up nature of the entity.

These and other details will be discussed in greater detail in the
following sections.

Interest Income and Interest Expense. The major source of earnings
for North Shore is net interest income. In fact, net interest income was
approximately 87% and 84% of the net revenues during 1995 and 1994,
respectively. Net interest income is defined as the difference between
interest income and fees on earning assets and interest expense on deposits and
borrowings. The following table sets forth information relating to North
Shore's consolidated average balances and interest income and expense
components for the year ended December 31, 1995. The table reflects the types
of accounts generating interest income and interest expense as well as those
accounts' average balances and yields/rates. Information related to the period
ended 1994 has not been presented due to limited operations in 1994.

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79

1995
-----------------------------------
Average Average
Balance Interest Yield/Rate
----------- ---------- ------------
(dollars in thousands)

ASSETS
Interest bearing deposits with banks . . . $14,178 $ 914 6.45%
Federal funds sold . . . . . . . . . . . . 8,193 478 5.83%
Taxable securities . . . . . . . . . . . . 9,218 546 5.92%
Loans, net of unearned discount . . . . . . 31,611 2,649 8.38%
------- ------ ----
Total earning assets . . . . . . . . . . . 63,200 4,587 7.26%

Cash and due from banks-noninterest bearing 1,841
Allowance for possible loan losses . . . . (165)
Premises and equipment, net . . . . . . . . 3,187
Other assets . . . . . . . . . . . . . . . 1,770
-------
Total assets . . . . . . . . . . . . . . . $69,833
=======

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits-interest bearing
NOW accounts . . . . . . . . . . . . . . . $ 2,618 77 2.94%
Savings and money market deposits . . . . . 18,374 710 3.86%
Time deposits . . . . . . . . . . . . . . . 32,507 2,054 6.32%
------- ----- ----
Total interest-bearing deposits . . . . . . 53,499 2,841 5.31%
------- ----- ----

Short-term borrowings . . . . . . . . . . . 0 0 0.00%
Term-debt . . . . . . . . . . . . . . . . . 0 0 0.00%
------- ----- ----
Total interest-bearing liabilities . . . . 53,499 2,841 5.31%
Noninterest bearing deposits . . . . . . . 7,879
Other liabilities . . . . . . . . . . . . . 198
Shareholders' equity . . . . . . . . . . . 8,257
------- ----- ----
Total liabilities and shareholders' equity $69,833
=======

Interest income/average earning assets . . 7.26%
Interest expense/average interest-bearing
liabilities . . . . . . . . . . . . . . . . 5.31%
----
Net interest spread . . . . . . . . . . . . $1,746 1.95%
====== =====
Net interest margin(1) . . . . . . . . . . 2.76%
=====

- --------------------------
(1) Net interest margin represents net interest income as a percent of the
average earning assets for the period.

Changes in Interest Income and Expense. Because North Shore has had
only one complete fiscal year and no prior period of comparison, presentation
of a disclosure of the dollar amount of changes in interest income and expense
by major categories of assets and liabilities attributable to changes in volume
or rate or both for such period is not considered meaningful.

Provision for Possible Loan Losses. The provision for possible loan
losses increased from $50,000 for the period through 1994 to $428,000 in 1995.
The increase is due to reflecting the full year of banking operations in
1995. Management's additions to the allowance for possible loan losses were
deemed appropriate as the loan portfolio increased approximately $53.8 million
between the year-end periods. At December 31, 1995, the allowance for possible
loan losses stood at 0.69% of loans outstanding which management feels is
adequate to cover potential losses in the portfolio. There can be no assurance
that future losses will not exceed the amounts provided for, thereby affecting
future results of operations. Future additions to the allowance for possible
loan losses are dependent upon the economy, changes in real estate values,
interest rates, the view of regulatory agencies toward adequate reserve levels,
and past due and non-performing loan levels.

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80

Other Noninterest Income. Noninterest income increased to $264,000 in
1995 from $36,000 in the previous period, an increase of $228,000.
Approximately $196,000 of the increase was primarily attributable to fees on
loans sold. North Shore Bank had no such fees during its first few months of
operations in 1994. Fees on loans sold relate to income received by North
Shore Bank for its services of originating and selling residential real estate
loans into the secondary market. The remaining increase in noninterest income
of $33,000 is a result of North Shore Bank receiving a full year of service
charges and miscellaneous fees in 1995.

Noninterest Expense. Noninterest expense includes all expenses other
than interest expense and the provision for possible loan losses. The
following table provides a detailed analysis of the composition of these
expenses.

YEAR PERIOD
ENDED ENDED
DECEMBER 31, DECEMBER 31, DOLLAR
1995 1994 CHANGE
---------------- ---------------- ----------

Salaries and employee benefits . . . . . . . . . $1,189 $ 546 $ 643
Occupancy expenses . . . . . . . . . . . . . . . 124 43 81
Advertising and marketing . . . . . . . . . . . . 205 65 140
Data processing . . . . . . . . . . . . . . . . . 143 36 107
Depreciation -- furniture and equipment . . . . . 104 22 82
Other noninterest expenses . . . . . . . . . . . 679 354 325
------ ------ ------
Total noninterest expenses . . . . . . . . . $2,444 $1,066 $1,378
====== ====== ======

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. Salaries and employee benefits
increased by $643,000 to $1,189,000 in 1995. The increase in salaries is a
result of four fundamental factors: (1) North Shore Bank was in its initial
operations for the period ended 1994; and, as such, the period did not fully
represent operational salaries and employee benefits. Staffing levels began to
accumulate in April of 1994 as North Shore Bank began the process of chartering
a new bank. A full staffing complement was achieved in September of 1994 when
North Shore Bank received regulatory approval and began to operate; (2) North
Shore Bank established a drive-through banking facility that became operational
in November, 1995 and required additional teller staffing; (3) North Shore Bank
established a full service banking facility in Glencoe, Illinois which began
serving customers in October of 1995. Salary and employee benefits related to
that branch in 1995 were approximately $94,000; and (4) North Shore Bank began
the process of establishing a full service banking facility in Winnetka,
Illinois and began to add key staff members at the end of 1995. Salaries and
employee benefits related to the Winnetka branch in 1995 were approximately
$9,000.

Occupancy Expenses. Occupancy expenses include those expenses which
relate directly to the operation of the buildings, improvements and property.
The major components of occupancy expense in 1995 were $64,000 for depreciation
expense on the buildings and improvements and $34,000 for real estate taxes.
The remaining $26,000 of expense in 1995 was for such items as utilities,
maintenance and repair of the buildings and grounds and rental expense. The
occupancy expense amount in 1995 was substantially higher than the prior period
ended 1994 because of the full year of operations in 1995 and due to the
establishment of the new drive-through banking facility and the Glencoe banking
facility that opened in October of 1995.

Advertising and Marketing. Marketing and advertising expenditures
amounted to $205,000 during 1995 compared to $65,000 for the period ended 1994.
North Shore Bank considers effective marketing to be a cornerstone of
establishing effective market penetration. North Shore Bank developed
community oriented deposit and loan products to attract its deposit base during
its initial months of operation and determined that expenditures for marketing
these products was appropriate. Management believes the advertising and
marketing expenses were instrumental in achieving the rapid growth in the
deposit base since the inception of North Shore Bank.

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Management anticipates that relatively similar levels of marketing expenses
will be incurred in 1996 as North Shore Bank continues to establish its base of
customers and to promote the opening of its Winnetka banking facility.

Data Processing. Data processing expense increased to $143,000 in
1995 from $36,000 for the period ended 1994, or a 297% increase. The increase
is directly related to the increase in the number of customer deposit and loan
accounts that were processed and the number of months North Shore Bank was in
operation during 1995. Customer deposit and loan balances increased 155% and
560%, respectively, from year-end 1994 to year-end 1995. Also, 1995
represented a full year of operations whereas the period ended 1994 had
slightly over three months of banking operations.

Depreciation--Furniture and Equipment. Depreciation of furniture and
equipment increased $82,000 in 1995 to $104,000. Again, the increase in this
category relates directly to the number of months of operation in 1995 versus
the period ended 1994, and the fact that additional furniture and equipment
were added in the later stages of 1995 to furnish and equip the new
drive-through location and the Glencoe banking facility.

Other Noninterest Expenses. Other noninterest expenses increased to
$679,000 in 1995 from $354,000 in the period ended 1994. The primary reasons
for the increase in this category are the length of time that North Shore Bank
was operational in 1995 and the expenses incurred to support the growth in
deposit and loan accounts. This category of expenses contains insurance
expense, stationery and supplies expense, postage expense, amortization of
organizational costs, audits and examinations expense, and other sundry
expenses. Controlling overhead expenses is a basic philosophy of management
and is closely evaluated. North Shore Bank's ratio of noninterest expenses to
average assets was 3.55% compared to its peer group average of 3.76% for the
year ended December 31, 1995. Despite having an expense ratio that is slightly
better than its peer group average, management is committed to continually
evaluating its operations to determine whether additional expense savings are
possible without impairing the goal of providing superior customer service.

Income Taxes. North Shore had no Federal or State income tax expense
for 1995 or for the period ended 1994. Management has established a valuation
allowance against its net deferred tax assets with the result being that no
federal or state income tax expense or benefit was realized in the financial
statements. Management anticipates that income tax expense or benefit will
begin to be recorded when North Shore Bank's earnings history and projected
future earnings are sufficient to make a judgment that the realization of the
net deferred tax asset is more likely than not.

FINANCIAL CONDITION

The dynamics of a community bank's balance sheet is generally
reflective of the ability of management to attract additional deposit accounts
to fund the growth of the institution. This is the current situation at North
Shore Bank as it is a relatively new institution which is still diligently
attempting to establish itself as the bank of choice in a significant amount of
households and businesses in the communities it serves. Accordingly, the
discussion of the financial condition of North Shore Bank will focus first on
the sources of funds received through the liability side of the balance sheet
which is predominantly deposit growth.

Deposits. Total deposit balances increased to $93,657,000 at December
31, 1995 compared to $36,736,000 at the end of 1994. Also, during the first
quarter of 1996, deposits increased by approximately $12,583,000 from the 1995
year-end level. The deposit growth was a result of effective marketing of
North Shore Bank's community oriented deposit products, management and director
interaction with the community, and the opening of a new banking facility in
Glencoe as well as a new drive-through banking facility in Wilmette. Deposit
growth occurred in all major deposit categories as shown in the table below
(dollars in thousands):

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December 31,
March 31, ----------------------------------------------------
1996 1995 1994
------------------------- ------------------------- --------------------------
Percent Percent Percent
of Total of Total of Total
Balance Deposits Balance Deposits Balance Deposits
------------ ------------ ------------ ------------ ------------ ------------

Demand . . . . . . . . . . . $ 12,569 11.8% $ 13,571 14.5% $ 5,539 15.1%
Savings . . . . . . . . . . . 10,910 10.3% 10,153 10.8% 7,258 19.8%
NOW . . . . . . . . . . . . . 11,878 11.2% 7,601 8.1% 1,475 4.0%
Money Market . . . . . . . . 13,661 12.8% 12,131 13.0% 7,974 21.7%
Certificates of deposit . . . 57,222 53.9% 50,201 53.6% 14,490 39.4%
------- ----- -------- ----- ------- -----
Total deposits . . . . . . $106,240 100.0% $ 93,657 100.0% $36,736 100.0%
======== ===== ======== ===== ====== =====

North Shore Bank offered a variety of special deposit account
promotions during its initial months of operations in 1994 when the main
location in Wilmette opened. Additionally, similar special deposit account
promotions were offered to households in Glencoe when that branch opened in
late October 1995, and to Winnetka residents during the first quarter of 1996
in anticipation of that facility opening in the second quarter of 1996.
Customers who opened a combination of accounts (generally a combination of an
interest-bearing account and a noninterest-bearing account) were afforded
special privileges as a "founding" depositor of North Shore Bank. These
privileges included rights to receive free safe deposit boxes, favorable loan
deposit rates as compared to the stated market rates, and other selected
prerequisites. The most popular product for North Shore Bank's initial
depositors was the certificate of deposit accounts. North Shore Bank continues
to aggressively promote its products to the community and attempts to meld the
competitive products with superior customer service. The result should be a
continuing growth in all deposit categories throughout 1996.

Reference is made to the average balance/rate table for data regarding
average daily deposits and rates paid thereon for the periods ended December
31, 1995 and 1994. North Shore Bank has no foreign deposits.

The aggregate amounts of time deposits, in denominations of $100,000
or more, by maturity, as of December 31, 1995 are shown below (in thousands):

Three months or less . . . . . . . . . . . . . . . $ 9,167
Over three through six months . . . . . . . . . . . 1,650
Over six through twelve months . . . . . . . . . . 2,207
Over twelve months . . . . . . . . . . . . . . . . 7,045
-------
Total . . . . . . . . . . . . . . . . . . . . . $20,069
=======

Accrued Interest Payable and Other Liabilities. Accrued interest
payable and other liabilities as of December 31, 1995 were $337,000 compared to
$178,000 at the end of the prior year. The increase can be primarily
attributed to a higher amount of accrued interest payable on deposit accounts
due to the significant growth in the level of deposits. No other significant
changes were present in this financial statement category.

Total Assets and Earning Assets. Total assets and earning assets were
$105,122,000 and $93,974,000, respectively, at December 31, 1995 compared to
$45,164,000 and $39,960,000, respectively, at December 31, 1994. The increase
in total assets and earning assets during the year was a result of significant
growth in all types of deposit categories. The level of earning assets as a
percentage of total assets remained steady at approximately 89% of total
assets; however, the composition of earning assets shifted as North Shore Bank
began to invest deposit funds into loans from shorter-term money market
investments. Loans comprised 67.5% of total earning assets at December 31,
1995 compared to 24.1% at December 31, 1994. These changes in the mix of
earning assets will be discussed further below.

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Loans. The following table shows Bancorp's loans classified by type
at March 31, 1996, December 31, 1995 and December 31, 1994 (in thousands):

December 31,
March 31, ------------------------------
1996 1995 1994
-------------- -------------- --------------

Residential real estate . . . . . $ 7,117 $ 8,557 $ 465
Commercial . . . . . . . . . . . 22,664 20,344 3,551
Home equity . . . . . . . . . . . 23,816 19,212 5,175
Consumer . . . . . . . . . . . . 18,251 15,417 427
------- ------- -------
Total gross loans . . . . . . 71,848 63,439 9,618
Less unearned discount . . . . . -- -- --
-- -- --
Net loans . . . . . . . . . . $71,848 $63,439 $ 9,618
====== ======= =======

Total loans increased to $63,439,000 at December 31, 1995 from
$9,618,000 at December 31, 1994. As can be seen from the table above,
significant growth occurred in all loan types during 1995. Generally, the
growth in the loan portfolio was a result of the following factors: (1) during
North Shore Bank's first few months of operations in 1994, the focus of
management was to concentrate on attracting deposit accounts and providing
superior customer service; (2) management was cautious in making loans during
the initial months of operations until a stable core deposit base could be
established; and (3) loan product development and customer relationships
evolved during 1995 which resulted in higher loan demand. The following
paragraphs will highlight the growth by loan type.

The commercial loan category increased by $16,793,000 from year-end
1994 to year-end 1995. This category includes such loans as working capital
lines of credit, equipment financing, interim construction financing for
builders, commercial real estate financing and balloon financing for a variety
of real estate investors. The increase can be attributed to an expanded
customer base, referral networks, and the moving of customer relationships from
previous bank affiliations with North Shore Bank's senior officers.

The outstanding level of home equity loans increased $13,946,000
during 1995. Several promotional home equity loan products were offered during
the year which featured competitive rates and fee arrangements. Also,
depositors who opened accounts with the bank during the first six months of its
operations were awarded certain lifetime benefits, one of which was a special
rate on home equity loans. Management attributes the growth in this lending
category to these promotional programs. These loans are secured by first or
second position mortgage liens on the underlying property with loan-to-value
ratios not exceeding 80%.

Consumer loans increased approximately $15 million from December 31,
1994 to December 31, 1995. Approximately $10.4 million of this increase is
related to the purchase of fixed rate indirect automobile loans. These
indirect automobile loans are purchased from Hinsdale Bank and Trust Company,
an affiliated bank, and are loans secured by new and used automobiles. These
credits generally have an original maturity of 36 to 60 months; however, the
average actual maturity is estimated to be approximately 37 months. The risk
associated with this portfolio is diversified amongst many individual
borrowers.

Residential real estate increased $8,092,000 during 1995. This
category includes adjustable rate mortgages that have repricing terms from one
to three years, construction loans to individuals, and bridge financing loans
for qualifying customers. North Shore Bank does not generally originate loans
for its own portfolio with long-term fixed rates due to interest rate risk
considerations. However, North Shore Bank does accommodate customer requests
for these fixed rate loans by originating and selling the loans in the
secondary market for which North Shore Bank receives a fee.

North Shore Bank has no loans to businesses or governments of foreign
countries.

Money Market Investments and Investment Securities. North Shore
Bank's objective in managing its securities portfolio is to balance North Shore
Bank's liquidity risk, interest rate risk and credit quality such that the

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earnings of North Shore Bank are maximized. As noted in the "Loan" section
above, the predominant portion of the funds received from new deposit accounts
was invested in the various loan categories during 1995. Management has
maintained the funds that were not invested in loans in short-term investment
securities and money market investments as follows:

December 31,
March 31, -------------------------------
1996 1995 1994
-------------- ------------- --------------

Federal funds sold . . . . . . . . . . . $ 8,875 $12,000 $ 7,170
Interest bearing deposits with banks . . 10,000 7,000 14,000
Investment securities . . . . . . . . . . 12,056 11,535 9,172
------- ------- -------
Total money market investments
and investment securities . . . . . . $30,931 $30,535 $30,342
======= ======= =======

Federal Funds Sold and Interest Bearing Deposits with Banks. Federal
funds sold and interest bearing deposits with banks are very short-term
investments with high quality banks. The balances in these accounts fluctuate
based upon deposit inflows and loan demand. These accounts are extremely
liquid and provide management with the ability to meet liquidity needs for
supplying loan demand or for other reasons.

Investment Securities. The carrying value of securities held by North
Shore at December 31, are as follows (in thousands):

December 31,
-------------------------------
1995 1994
-------------- --------------

AVAILABLE-FOR-SALE
U.S. agency obligations . . . . . . $ 8,971 $ --
Other securities . . . . . . . . . . 2,002 --
Federal Reserve Bank stock . . . . . 212 --
Equity securities . . . . . . . . . 350 --
------- ---
Total available-for-sale . . . . $11,535 --
------- ------
HELD-TO-MATURITY
U.S. agency obligations . . . . . . -- 8,974
Federal Reserve Bank stock . . . . . -- 198
------- ------
Total held-to-maturity . . . . . -- 9,172
------- ------

Total investment securities . . . $11,535 $9,172
======= ======

There were no securities of any single issuer which had book value in
excess of 10% of shareholders' equity at December 31, 1995.

Maturities of securities as of December 31, 1995 are as follows (in thousands):

Within From 1 From 5 to After Equity
1 Year to 5 years 10 years 10 years Securities Total
---------- ------------ ------------- ---------- ------------ ------------

U.S. agency obligations . . . . $8,971 $ -- $ -- $ -- $ -- $ 8,971
Other securities . . . . . . . 499 1,503 -- -- -- 2,002
Federal Reserve Bank stock . . -- -- -- -- 212 212
Equity securities . . . . . . . -- -- -- -- 350 350
------ ------ ------ ------ ------ -------
Total . . . . . . . . . . . . $9,470 $1,503 $ -- $ -- $ 562 $11,535
====== ====== ====== ====== ====== ========

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The weighted average yield for each range of maturities of securities is shown
below as of December 31, 1995:

Within From 1 From 5 to After Equity
1 Year to 5 years 10 years 10 years Securities Total
---------- ------------ ------------- ---------- ------------ ------------

U.S. agency obligations . . . . 5.66% -- -- -- -- 5.66%
Other securities . . . . . . . 5.38% 6.52% -- -- -- 6.24%
Federal Reserve Bank stock . . -- -- -- -- 6.00% 6.00%
Equity securities . . . . . . . N/A N/A N/A N/A N/A N/A

Yields on equity securities are not considered meaningful for purposes of this
analysis.

North Shore did not own any federally tax-advantaged securities during the
periods presented.

Shareholders' Equity. North Shore was initially capitalized through
the issuance of 1,000 common shares, no par value, at $1 each; 10,000 no par
preferred convertible shares at $50 each; and 5,000 no par common stock series
A warrants at $5 each. Each series A warrant entitles the holder to acquire
one share of common stock at a purchase price of $50.

Subsequent to the initial capitalization, in 1994, North Shore raised
an additional $8,670,000 through the private placement issuance of 173,480 no
par common shares. During the initial period of operations, North Shore
allocated $1,000,000 of the initial surplus to undivided profits to cover
initial operating expenditures.

The 10,000 preferred shares initially outstanding were exchanged in
the fourth quarter of 1994 for 22,500 common shares of North Shore Common
Stock, as the preferred stock was retired by North Shore.

North Shore also has a stock rights plan for certain key employees and
Directors. Each stock right entitles the holder to purchase one share of North
Shore's common stock for $40.00 per share. The plan was adopted on December 1,
1993 and expires on December 1, 2003. The plan provides for the issuance of a
total of 20,000 such rights, all of which have been awarded. As of December
31, 1995, none of the stock rights had been exercised.

Because of growth, during 1995, North Shore authorized the issuance of
additional shares of common stock at $75 per share. This additional offering
of common stock resulted in additional capital proceeds of approximately $4.3
million. Of the $4.3 million raised, approximately $3.7 million was received
in 1995 and the remaining $0.6 million was received in the first quarter of
1996.

The following table reflects various measures of capital at March 31,
1996, December 31, 1995 and December 31, 1994:

DECEMBER 31,
MARCH 31, -------------------------------
1996 1995 1994
-------------- -------------- --------------

Ending tier 1 risk based capital ratio . . 12.8% 15.2% 18.4%
Ending total risk based capital ratio . . . 13.4% 15.8% 18.5%
Ending leverage ratio . . . . . . . . . . . 9.5% 10.3% 17.6%
Dividend payout ratio . . . . . . . . . . . 0.0% 0.0% 0.0%

The leverage ratios, tier 1 risk-based capital ratios and total
capital ratios all exceed the "well capitalized" levels established by
regulatory agencies of 5%, 6% and 10%, respectively.

Management is not aware of any known trends, events, regulatory
recommendations or uncertainties that will have any adverse effect on North
Shore's capital resources or operations.

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ASSET-LIABILITY MANAGEMENT

As a continuing part of its financial strategy, North Shore attempts
to manage the impact of fluctuations in market interest rates on its net
interest income. This effort entails providing a reasonable balance between
interest rate risk, credit risk, liquidity risk and maintenance of yield.
Asset-liability management policies are established and monitored by management
in conjunction with the Board of Directors. The policy establishes guidelines
for acceptable limits on the sensitivity of the market value of assets and
liabilities to changes in interest rates.

The following table illustrates North Shore's estimated interest rate
sensitivity and periodic and cumulative gap positions as calculated as of March
31, 1996. An institution with more assets repricing than liabilities over a
given timeframe is considered asset sensitive and will generally benefit from
rising rates.

0-90 91-365 1-5 Over 5
Days Days Years Years Total
----------- ----------- ------------ ------------ -----------

Total assets . . . . . . . . . . . . $81,015 $ 7,321 $ 9,919 $19,683 $117,938
Total liabilities and equity . . . . 63,460 16,001 12,003 26,474 117,938
------- ------- ------- ------- --------
Interest sensitivity gap . . . . . . $17,555 $(8,680) $(2,084) $(6,791)
======= ======= ======= =======

Cumulative interest sensitivity gap . $17,555 $ 8,875 $ 6,791
Ratio of cumulative rate sensitivity
gap to rate sensitive assets . . . 14.93% 7.55% 5.78%
Cumulative ratio of rate-sensitive
assets to rate-sensitive
liabilities . . . . . . . . . . . 127.66% 111.17% 107.42% 100.00%

To protect the net interest margin from the volatility of the business
cycle, particular attention is given to managing the interest rate spread
between the yield on earning assets and the cost of funds. Management has
determined that this can best be achieved by maintaining a balance sheet with
an asset sensitive posture. The tables shown above depicts an interest rate
sensitivity position consistent with management's philosophy.

LIQUIDITY

At the Bank Level. Liquidity management involves planning to meet
anticipated funding needs at a reasonable cost. Liquidity management is guided
by policies formulated and monitored by North Shore Bank's Asset/Liability
Committee, which take into account the marketability of assets, the sources and
stability of funding and the level of unfunded commitments.

"Liquid assets" refers to money market assets such as Federal funds
sold and interest bearing deposits with banks, as well as available-for-sale
debt securities and held-to-maturity securities with a remaining maturity of
less than one year. Net liquid assets would represent the sum of the liquid
asset categories less the amount of assets pledged to secure public funds. At
December 31, 1995, net liquid assets totaled approximately $24 million,
compared to approximately $30 million at December 31, 1994. Thus, North Shore
Bank has substantial short-term balance sheet liquidity.

Long-term liquidity needs are provided by a large core deposit base,
which is the most stable source of liquidity a community bank can have due to
the long-term relationships established with the depositors and the security of
deposit insurance provided by the Federal Deposit Insurance Corporation. At
December 31, 1995, 66% of total assets were funded by core deposits with
balances less than $100,000 while the remaining assets were funded by other
funding sources such as core deposits with balances in excess of $100,000,
public funds, purchased funds, and the capital of North Shore Bank. At
December 31, 1994, 76% of total assets were funded by core deposits with
balances less than $100,000.

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87

North Shore Bank routinely accepts deposits from a variety of
municipal entities. Typically, these municipal entities require that banks
pledge marketable securities to collateralize these public deposits. At
December 31, 1995 and 1994, North Shore Bank had approximately $5,800,000 and
$0 of such public deposits, respectively. These assets are not considered to
be core deposits and the assets that are pledged as collateral for these
deposits are not deemed to be liquid assets.

At the Holding Company Level. North Shore's principal funds are
dividends from North Shore Bank subsidiary, and if necessary, borrowings or
additional equity offerings. Banking laws place restrictions upon the amount
of dividends which can be paid to North Shore by North Shore Bank. Based on
these laws, North Shore Bank is not permitted to pay dividends until such time
as any previous operating losses have been recovered through earnings. As
such, no cash dividends were paid to North Shore by North Shore Bank during the
periods ended December 31, 1995 and 1994.

Also, North Shore Bank is required to maintain a 9% capital-to-assets
ratio for three years as a de novo bank, and is not allowed to pay dividends
during this de novo time period without prior approval of the banking
regulators. This three year period ends as of October, 1997.

Subsequent to the three year de novo period, North Shore Bank could,
subject to minimum capital requirements, declare dividends to North Shore
without obtaining regulatory approval in an amount not exceeding (a) undivided
profits, and (b) the amount of net income reduced by dividends paid for the
current and prior two years.

At January 1, 1996, North Shore Bank was not allowed to pay dividends
based upon the above mentioned restrictions.

Nonaccrual, Past Due and Restructured Loans. Nonaccrual loans at
March 31, 1996, December 31, 1995 and December 31, 1994 are as follows (in
thousands):

December 31,
March 31, -------------------------------
1996 1995 1994
-------------- -------------- --------------

Nonaccrual loans . . . . . . . . . . . . . $ 659 $ 519 $ --
Nonaccrual loans to total loans . . . . . . 0.92% 0.82% 0%

It is the policy of North Shore to discontinue the accrual of interest
income on any loan for which there is a reasonable doubt as to the payment of
interest or principal. Nonaccrual loans are returned to an accrual status when
the financial position of the borrower indicates there is no longer any
reasonable doubt as to the payment of principal or interest. The loans included
above as nonaccrual were not past due more than 90 days; however, management
believed the loans exhibited certain characteristics that created doubt as to
the payment of interest or principal. Other than those loans indicated above,
North Shore had no significant loans (1) for which the terms of had been
renegotiated, or (2) for which there were serious doubts as to the ability of
the borrower to comply with repayment terms.

There were no loans past due 90 days or more at March 31, 1996 or
December 31, 1995 or 1994.

Potential Problem Loans. In addition to the nonaccrual loans shown in
the table above, there are certain loans in the portfolio which management has
identified, through its problem loan identification system, which exhibit a
higher than normal credit risk. However, these loans do not represent
non-performing loans to North Shore. Management's review of the total loan
portfolio to identify loans where there is concern that the borrower will not
be able to continue to satisfy present loan repayment terms includes factors
such as review of individual loans, recent loss experience and current economic
conditions. Loans in this category include those with characteristics such as
those past maturity more than 45 days, those that have recent adverse operating
cash flow or balance sheet trends, or have general risk characteristics that
the loan officer feels might jeopardize the future timely collection

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88

of principal and interest payments. The principal amount of loans in this
category as of December 31, 1995 was approximately $383,000. Loans in this
category generally include loans that were classified for regulatory purposes.
At December 31, 1995, there were no significant loans which were classified by
any bank regulatory agency that are not included above as nonaccrual, past due,
or restructured.

Loan Concentrations. Loan concentrations are considered to exist when
there are amounts loaned to a multiple number of borrowers engaged in similar
activities which would cause them to be similarly impacted by economic or other
conditions. At December 31, 1995, North Shore had no concentrations of loans
exceeding 10% of total loans.

Other Real Estate Owned. In addition to the risk elements identified
above, Other Real Estate Owned would provide insight into the historical
quality of the loan portfolio. North Shore has had no Other Real Estate Owned
during any of the reporting periods.

Summary of Loan Loss Experience. The following table summarizes loan
balances at the end of each period, changes in the allowance for possible loan
losses arising from additions to the allowance which have been charged to
earnings, and loans charged-off and recoveries on loans previously charged-off
by loan category.

THREE MONTHS
ENDED YEAR ENDED PERIOD ENDED
MARCH 31, DECEMBER 31, DECEMBER 31,
1996 1995 1994
------------------ ------------------ ------------------

Balance at beginning of period . . . . . . . . . . $ 440,000 $ 50,000 $ --
Total loans charged off . . . . . . . . . . . . . . 10,000 38,000 --
Total recoveries on loans previously charged-off . (1,000) -- --
Add: Provision for possible loan losses . . . . . 79,000 428,000 50,000
----------- ----------- --------
Balance at end of period . . . . . . . . . . . . . $ 510,000 $ 440,000 $ 50,000
=========== =========== ========
Average loans outstanding . . . . . . . . . . . . . $68,245,000 $31,611,000 $988,000
=========== =========== ========
Ratio of net charge-offs during the period to
average loans outstanding during the period . . 0.01% 0.12% 0.00%
=========== =========== ========

As of December 31, 1995, management allocated the allowance for
possible loan losses by specific category as shown in the following table. The
allocation was made after considering all relevant qualitative and quantitative
factors about the loan portfolio.

PERCENT OF
LOANS IN EACH
CATEGORY TO
AMOUNT TOTAL LOANS
-------------- -----------------

Residential real estate . . . . . . $ 8,000 14%
Commercial . . . . . . . . . . . . 123,000 32%
Home equity . . . . . . . . . . . . 108,000 30%
Consumer . . . . . . . . . . . . . 85,000 24%
Unallocated . . . . . . . . . . . . 116,000 N/A
-------- ---
Total . . . . . . . . . . . . . $440,000 100%
======== ===

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is reviewed by the Board of Directors and its Credit Committee on a monthly
basis. Independent external review of the loan portfolio is provided by the
examinations conducted by regulatory authorities, independent public
accountants in conjunction with their annual audit, and an independent loan
review performed by an entity engaged by the Board of Directors. The amount of
additions to the allowance for possible loan losses which are charged to
earnings through the provision for possible loan losses are determined based on
a variety of factors, including actual charge-offs during the year, historical
loss experience, delinquent loans, and an evaluation of current and prospective
economic conditions in the market area. Management believes the allowance for
possible loan losses is adequate to cover any potential losses.

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LAKE FOREST BANCORP, INC.

BUSINESS

Organization and Operation. Lake Forest Bancorp, Inc. ("Lake Forest")
is a bank holding company that was incorporated as a Delaware corporation on
June 25, 1991. The primary asset of Lake Forest is its ownership of 100% of
the common shares of Lake Forest Bank. Lake Forest is engaged in the business
of banking through its ownership of Lake Forest Bank. Its mailing address is
727 North Bank Lane, Lake Forest, Illinois 60045 and its telephone number is
(847) 234-2442. As of March 31, 1996, Lake Forest had total assets of
$216,859,000 and total stockholders' equity of $11,095,000.

Lake Forest Bank was organized under the laws of the State of Illinois
and commenced operation in December, 1991. Lake Forest and Lake Forest Bank
are regulated by the Federal Reserve Bank. Additionally, Lake Forest Bank is
regulated by the "CBTC" and the FDIC.

Lake Forest Bank is the only locally owned and managed full service
commercial bank in its primary service area of Lake Forest, Illinois and Lake
Bluff, Illinois. The City of Lake Forest is located approximately 20 miles
north of the downtown Chicago area and has a population of approximately
17,900. The City of Lake Bluff is located directly north and adjacent to the
City of Lake Forest and has a population of approximately 5,500.

Employees. As of March 31, 1996, Lake Forest Bank employed 51
full-time equivalent employees. Lake Forest has no paid employees.

Services. Lake Forest Bank is an Illinois chartered, FDIC-insured
commercial bank which provides the full range of banking services, including
trust operations. Lake Forest Bank furnishes personal and commercial banking
services, including demand, NOW, money market, savings, and time deposit
accounts; real estate, commercial, and consumer loans; safe deposit facilities;
and trust services.

Lake Forest Bank was formed to provide the Lake Forest and Lake Bluff
communities with a community bank alternative. As such, Lake Forest Bank is
focused on providing a highly personal, professional level of service to
commercial and retail customers residing in these areas. Emphasis is placed on
local ownership and management in attracting and maintaining deposit, loan and
trust customers.

Property. Lake Forest Bank has four physical banking locations. Lake
Forest Bank owns the main bank facility that is a three story, 18,000 square
foot brick building located at 727 North Bank Lane in Lake Forest, Illinois.
Lake Forest Bank constructed a drive-in, walk-up banking facility on land
leased from the City of Lake Forest on the corner of Bank Lane and Wisconsin
Avenue in Lake Forest, approximately one block north of the main banking
facility. Lake Forest Bank also leases a 1,200 square foot, full service
banking facility at 103 East Scranton Avenue in Lake Bluff, Illinois and a
2,100 square foot, full service banking facility on the west side of Lake
Forest, Illinois at 810 South Waukegan Road. Lake Forest Bank maintains
automated teller machines at each of its locations except the 810 South
Waukegan Road facility. Lake Forest Bank has no offsite automated teller
machines.

ADDITIONAL INFORMATION

For a description of Lake Forest's and Lake Forest Bank's competition,
litigation, regulatory environment, interests in affiliates, transactions with
management and relationship with independent public accountants, see "MATTERS
OF GENERAL APPLICABILITY TO BANKS."

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MANAGEMENT OWNERSHIP OF COMMON STOCK

The following table sets forth information as of March 31, 1996, with
respect to beneficial ownership of shares of Lake Forest Common Stock held by
(i) each director of Lake Forest, (ii) each executive officer of Lake Forest and
(iii) all directors and executive officers as a group.

Shares
Issuable
Upon Shares Total Pro
Conversion Subject Lake % of Forma
of to Vested Forest Lake % of
Common Preferred Stock Beneficial Forest Wintrust
Shares(1) Shares(2) Options Ownership Total(3) Total(3)(4)
---------- ------------ ------------ ----------- ----------- -----------

DIRECTORS
- ---------
Howard D. Adams** . . . . . . . . . 17,890 -- 200 18,090 11.06% 7.56%
Craig E. Arnesen** . . . . . . . . 3,280 750 4,634 8,664 5.16% 1.46%
Maurice F. Dunne, Jr. . . . . . . . 1,200 -- 580 1,780 1.09% *
Robert Harnach . . . . . . . . . . 14,050 -- -- 14,050 8.60% 6.31%
John A. Hilton, Jr. . . . . . . . . 410 -- 467 877 * *
Eugene Hotchkiss . . . . . . . . . 200 -- 134 334 * *
Moris T. Hoversten . . . . . . . . 1,430 -- 673 2,103 1.28% *
John S. Lillard . . . . . . . . . . 3,500 -- 466 3,966 2.42% *
Albin Moschner . . . . . . . . . . 400 -- -- 400 * *
Genevieve M. Plamondon . . . . . . 1,200 -- 700 1,900 1.16% *
Hollis Rademacher . . . . . . . . . -- -- -- -- * *
J. Christopher Reyes . . . . . . . 3,000 -- 414 3,414 2.08% 1.58%
Babette Rosenthal . . . . . . . . . 362 -- -- 362 * *
Ellen A. Stirling . . . . . . . . . 7,000 -- 540 7,540 4.60% 1.51%
Edward J. Wehmer** . . . . . . . . 636 1,500 8,748 10,884 6.32% 3.20%
------- ----- ----- ------ -----
Total Directors . . . . . . . . 54,558 2,250 17,556 61,664 44.98%

NON-DIRECTOR EXECUTIVE OFFICERS
David A. Dykstra . . . . . . . . . 250 -- 300 550 * *
Randolph Hibben . . . . . . . . . . 784 300 2,443 3,527 2.13% *
Robert F. Key . . . . . . . . . . . 409 -- -- 409 * *
Joseph Alaimo . . . . . . . . . . . 333 -- 250 583 * *
Frank Strainis . . . . . . . . . . 105 -- 250 355 * *
Lloyd M. Bowden . . . . . . . . . . 455 -- -- 455 * *
------- ----- ------ ------- -----

Total Directors and
Executive Officers as a group . 56,894 2,550 20,799 80,243 48.54%
======= ===== ====== ======= =====

Total Common Shares and Share
Equivalents . . . . . . . . . . 160,810 2,550 23,806 187,166
======= ===== ====== =======

- ----------------

* -- Less than 1%
** -- Denotes executive officer (in addition to director status)
(1) Includes shares held directly and, if applicable, indirectly through such
person's spouse, minor children, certain family trusts, IRA's or 401(k)
plans.
(2) Pursuant to the Reorganization Agreement, all preferred shares are to be
converted to shares of Common Stock prior to consummation of the
Reorganization. Each share of preferred stock is convertible into 1.5
shares of Lake Forest Common Stock.
(3) Beneficial ownership percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.
(4) Assumes no exercise of outstanding options, rights or warrants other
than the anticipated exercise of a portion of the First Premium warrants
resulting in 399,612 additional shares of Wintrust Common Stock to be
outstanding immediately following the Effective Date of the
Reorganization. Includes shares deemed beneficially owned by such persons
in any of the other Companies, giving effect to the applicable Exchange
Ratios and North Shore Stock Split. Also gives effect to the cancellation
of intercompany share ownership as provided in the Reorganization
Agreement.
(5) Includes an aggregate 3,280 shares held in certain family trusts for the
benefit of Mr. Adams' children and with respect to which Mr. Adams' wife
has voting power; also includes 80 shares held by a charitable foundation
with respect to which shares Mr. Adams has voting power. Mr. Adams
disclaims beneficial ownership of all such shares. Does not include an
aggregate of 8,450 shares held by the Alan W. Adams Family Trust and the
Sarah K. Adams Family Trust for the benefit of Mr. Adams' adult children
nor an additional 649 shares held by his children. See "-- Beneficial
Ownership of Certain Shareholders."
(6) Includes (i) 600 shares held by Milbank Corporation of which Mr. Harnach
is an officer, director and principal shareholder; (ii) 750 shares held
by an employee retirement plan of Milbank Corporation of which Mr.
Harnach is a trustee; and (iii) 12,700 shares held by Deerpath
Investments LLP to which Milbank Corporation serves as investment advisor
and with respect to which shares Mr. Harnach has shared voting and
investment power.

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BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS

On March 31, 1996, Lake Forest had 160,810 shares of common stock
outstanding. As of such date, the following persons not listed under
"Management Ownership of Common Stock" are known by Lake Forest to be the
owners of more than 5% of its common stock.

Number of Shares Percent
Name Address Beneficially Owned of Class(1)
------------------------------------ --------------------------- ----------------------- ---------------

Milbank Corporation(2) 135 South LaSalle Street 15,650 9.58%
Chicago, Illinois 60603

Emmett D. McCarthy, as trustee for(3):

Alan W. Adams Family Trust 570 Crabtree Lane
Sarah K. Adams Family Trust Lake Forest, Illinois 8,450 5.18%

(1) Beneficial ownership percentages are calculated in accordance with SEC Rule
13d-3 promulgated under the Securities Exchange Act of 1934.

(2) Includes (i) 600 shares held by Milbank Corporation ("Milbank") of which
Robert D. Harnach, a director of Lake Forest and Hinsdale, is an officer,
director and principal shareholder with shared voting and investment power
relating to such shares; (ii) 600 shares held by Larry Wright, a director
of Crabtree who is also an officer, director and principal of Milbank;
(iii) 750 shares held by an employee retirement plan of Milbank of which
Mr. Wright and Mr. Harnach are trustees with voting and investment power;
(iv) 12,700 shares held in Deerpath Investments LLP, a limited partnership
to which Milbank serves as investment advisor and with respect to which Mr.
Wright and Mr. Harnach exercise shared voting and investment power; and (v)
1,000 shares held in certain family trusts of another officer of Milbank
with respect to which such officer of Milbank acts as co-trustee and
exercises voting power.

(3) The Alan W. Adams Family Trust and the Sarah K. Adams Family Trust are
irrevocable trusts for which Emmett McCarthy and either Alan W. Adams or
Sarah K. Adams, respectively, serve as co-trustees. Mr. McCarthy is a
Director of Crabtree. Of the total shares beneficially owned by the two
Trusts, each Trust owns 4,225 shares of Lake Forest Common Stock. The
beneficiaries of the respective Trusts are Alan W. Adams and Sarah K.
Adams, respectively, the two adult children of Howard D. Adams, and Mr.
McCarthy disclaims beneficial ownership of all such shares. Mr. Alan W.
Adams is currently a vice president of Lake Forest Bank and a Director
nominee of Wintrust and directly owns an additional 449 shares and has
vested options to acquire an additional 100 shares.

SELECTED FINANCIAL DATA
LAKE FOREST BANCORP, INC.

Period
Three Months Ended ended
March 31, Year Ended December 31, Dec. 31,
---------------------------- ------------------------------------------ ---------
1996 1995 1995 1994 1993 1992 1991(1)
------------- ------------- --------- --------- ---------- -------- ---------
(DOLLARS IN THOUSANDS)

Interest income . . . . . . $ 3,445 $ 2,665 $ 12,180 $ 6,708 $ 3,743 $ 1,800 $ 18
Interest expense . . . . . 2,200 1,692 7,749 3,831 1,939 1,031 8
-------- -------- -------- -------- ------- ------- ------
Net interest income . . . . 1,245 973 4,431 2,877 1,804 769 10
Provision for possible loan
losses . . . . . . . . . . 110 63 301 240 240 182 0
-------- -------- -------- -------- ------- ------- ------
Net interest income after
provision for possible
loan losses . . . . . . 1,135 910 4,130 2,637 1,564 587 10
Noninterest income,
excluding security gains 240 149 1,115 628 760 52 0
Security gains . . . . . . 18 0 0 21 23 0 0
Noninterest expense . . . . 1,133 969 4,402 2,778 2,147 2,025 340
-------- -------- -------- -------- ------- ------- ------
Net income before income
taxes . . . . . . . . . . . 260 90 843 508 200 (1,386) (330)
Income tax expense
(benefit) . . . . . . . . . 82 0 (172) 0 0 0 0
-------- -------- -------- -------- ------- ------- ------
Net income (loss) . . . . . $ 178 $ 90 $ 1,015 $ 508 $ 200 $(1,386) $ (330)
======== ======== ======== ======== ======= ======= ======

Net income (loss) per
common share . . . . . . $ 1.01 $ 0.54 $ 5.95 $ 3.05 $ 1.32 $(13.36) NM
Cash dividends per common
share . . . . . . . . . . . $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0

Total assets at end of
period . . . . . . . . . . $216,350 $164,642 $197,140 $144,155 $96,186 $50,128 $9,033
Total deposits at end of
period . . . . . . . . . . $200,021 $151,618 $181,186 $126,067 $81,452 $42,996 $2,361
Secured-term debt at end of
period . . . . . . . . . . $ 3,952 $ 2,922 $ 3,952 $ 2,742 $ 0 $ 600 $ 600
Preference stock at end of
period . . . . . . . . . . $ 3 $ 3 $ 3 $ 3 $ 3 $ 3 $ 0

Return on average total
assets . . . . . . . . . . 0.35% 0.23% 0.58% 0.44% 0.28% (3.90%) --(2)
Return on average common
shareholders' equity . . 6.49% 3.79% 9.98% 5.53% 2.35% (25.18%) --(2)

- -----------------------
(1) Management has for this period presented selected financial data
reflecting reported results from the date of incorporation (September
25, 1991) to December 31, 1991. The Company was in a capital raising
and organizational phase and as described elsewhere herein was only
operational from December 27, 1991 to December 31, 1991.

(2) Return on average assets and average equity ratios are not meaningful
as a result of the nature of operations as discussed in Note 1 above.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

General. Lake Forest completed its fourth full year of operations in
1995. During that time period, Lake Forest has conducted no business other
than that directly related to "Lake Forest Bank". Lake Forest's results of
operations are primarily dependent on Lake Forest Bank's net interest income,
which is the difference between interest income on interest-earning assets and
interest expense on interest-bearing liabilities. In addition, to a lesser
extent, Lake Forest Bank's operating results are affected by fees paid by
borrowers, fees earned on residential mortgage loans sold to the secondary
market, customer service charges and other income. Also, noninterest expenses
such as employee salaries and benefits, office occupancy, marketing, insurance
costs and other expenses affect the results of operations. Finally, income tax
consequences have an impact on the reported results of operations.

Operational results are also affected by general economic conditions
(particularly changes in interest rates), competition, government policies and
actions of regulatory agencies.

RESULTS OF OPERATIONS

Comparison of Results for the Period Ended March 31, 1996 to the Period Ended
March 31, 1995

Lake Forest recorded net income of $178,000 and $90,000 for the
three-month period ended March 31, 1996 and for the three-month period ended
March 31, 1995, respectively. The following discussion will discuss the
components of the net income and the change between the respective three month
periods.

Net interest income increased to $1,245,000 for the three months ended
March 31, 1996 from approximately $973,000 for the same period of 1995. This
28% increase in net interest income can generally be attributable to a 29%
increase in average earning assets for the first quarter of 1996 as compared to
the first quarter of 1995. The net interest margin was 2.66% for the three
months ended March 31, 1996 compared to 2.68% for the three months ended March
31, 1995. Accordingly, the increase in average earning assets combined with a
very slight compression of the net interest margin appropriately explains the
increase in the net interest margin.

The provision for possible loan losses increased to $110,000 for the
three months ended March 31, 1996 compared to $63,000 for the prior year three
month period. Lake Forest Bank has provided a higher amount to the allowance
for possible loan losses during the first quarter of 1996 because of the growth
in the loan portfolio. Loans outstanding at March 31, 1996 were $121,055,000
compared to $77,068,000 at March 31, 1995. Management considers it prudent to
continue to build a reserve for unanticipated credit problems that may occur
with the existing portfolio despite having no loans on nonaccrual status or
significantly past due at March 31, 1996. The allowance for loan losses as a
percentage of total loans outstanding stood at 0.78% at March 31, 1996 compared
to 0.91% as of March 31, 1995. The decline in the ratio of the allowance to
total loans is a function of the growth in the loan portfolio and net
charge-offs of approximately 98,000 during the first quarter of 1996. However,
due to the high quality of the outstanding loan portfolio, management considers
the amount of the provision and the level of the allowance for loan losses to
be adequate for the period ended and as of March 31, 1996.

Other noninterest income, excluding security gains, totaled $240,000
for the three months ended March 31, 1996 compared to approximately $150,000
for the three months ended March 31, 1995. The increase in the 1996 and 1995
three month periods is primarily a result of (1) approximately $40,000 of
increased revenue related to fees on fixed rate residential mortgage loans
which were sold to the secondary market; and (2) approximately $37,000 of
increased income from trust administration services. Additionally, Lake Forest
recorded an $18,000 gain on the sale of securities that were available for
sale, whereas 1995's first quarter had no gains from the sales of securities.

Other noninterest expenses were $1,133,000 and $969,000 for the
three-month periods ended March 31, 1996 and March 31, 1995, respectively. The
major components of the other noninterest expenses for the respective three
month periods are as follows (in thousands):

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Three Months Ended March 31,
---------------------------------------
1996 1995
------------------ ------------------

Salaries and employee benefits . . . . $ 620 $478
Occupancy expense . . . . . . . . . . . 124 89
Other noninterest expenses . . . . . . 389 402
------ ----
Total other noninterest expenses . . . $1,133 $969
====== ====

Salaries and Employee Benefits and Occupancy Expense. Salaries and employee
benefits and occupancy expenses were higher in the first quarter of 1996
compared to the first quarter of 1995 primarily because of the opening of a new
banking facility in the western section of Lake Forest during the second
quarter of 1995. Accordingly, the 1996 amounts include salaries and benefits
for 5 additional employees related to that facility compared to no such
expenses in the first three months of 1995. Also, normal salary increases
contributed to the increase from the 1995 period to the 1996 period.
Additionally, occupancy expense increased for 1996's first three months
fundamentally as a result of the additional bank location.

Other Noninterest Expenses. Notwithstanding the additional expenses incurred
related to the opening of the additional banking facility as noted in the
preceding section, other noninterest expenses declined for the first quarter of
1996 as compared to the first quarter of 1995 primarily as a result of (1) a
significant reduction in the level of premiums charged for Federal Deposit
Insurance Corporation (FDIC) deposit insurance. During the first quarter of
1995, Lake Forest Bank was paying a premium $0.23 per $100 of deposits for FDIC
insurance, or approximately $66,000; however during for the first quarter of
1996, Lake Forest Bank recorded expense of only $500 due to a significant
restructuring of the deposit insurance rate schedule. Lake Forest Bank expects
the $500 per quarter rate to apply for the remainder of 1996 unless the rate
schedule is further modified by the FDIC; (2) the amount recorded for
advertising and marketing expenses for the first three months of 1996 was
approximately $24,000 less than the same period of 1995 primarily due to the
fact that 1995's marketing expenses included promotions for the upcoming
opening of the new banking facility in western side of Lake Forest; and (3)
offsetting these expense reductions were the normal operating costs of
operating the one additional banking location in 1996's first quarter compared
to 1995's first quarter.

Comparison of Results for the Years Ended December 31, 1995 and December 31,
1994

General. Lake Forest had net income of $1,015,000 for the year ended
December 31, 1995, compared with $508,000 for the year ended December 31, 1994.
The increase in net income was due to an increase in net interest income of
$1,554,000, an increase in other noninterest income of $466,000, the
realization of $172,000 in income tax benefits, offset by an increase in the
provision for possible loan losses of $61,000 and other noninterest expenses of
$1,624,000. These and other details will be discussed in greater detail in the
following sections.

Net Interest Income. The major source of earnings for Lake Forest is net
interest income. Net interest income was approximately 80%, 82% and 70% of the
net revenues during 1995, 1994, and 1993, respectively. Net interest income is
defined as the difference between interest income and fees on earning assets
and interest expense on deposits and borrowings.

Interest Income and Interest Expense. Interest income increased from
$6,708,000 in 1994 to $12,180,000 in 1995. This $5,472,000 increase in
interest income was attributable to (1) a 52% increase in average earning
assets; (2) a shift in the earning assets mix such that higher yielding loans
comprised a larger portion of the total earning assets; and (3) a rise in
interest rates during 1995. Interest expense increased from $3,831,000 in 1994
to $7,749,000 in 1994. The 102% increase in interest expense was attributable
to a 56% increase in interest-bearing liabilities and a general rise in
interest rates paid to depositors during 1995. An analysis of the components
and characteristics of interest income and interest expense is presented in the
table below, including average balances and average rates/yields for Lake
Forest Bank's earning assets and interest bearing liabilities for the years
ended December 31, 1995, 1994 and 1993.

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95

1995 1994 1993
------------------------------- ------------------------------- ----------------------------------
AVERAGE AVERAGE AVERAGE
AVERAGE YIELD/ AVERAGE YIELD/ AVERAGE YIELD/
ASSETS BALANCE INTEREST RATE BALANCE INTEREST RATE BALANCE INTEREST RATE
----------- --------- --------- --------- --------- ----------- ---------- ---------- -----------
(dollars in thousands)

Interest bearing deposits
with banks . . . . . . . . . $ 21,265 $ 1,130 6.25% $ 12,351 $ 555 4.49% $ 7,663 $ 258 3.37%
Federal funds sold . . . . . . 15,044 876 5.82% 8,551 361 4.22% 7,808 239 3.06%
Taxable debt securities . . . 34,960 1,916 5.48% 27,442 1,380 5.03% 17,534 827 4.72%
1,334 0 0.00% 381 0 0.00% 0 0 --
Loans, net of
unearned discount . . . . . 89,764 8,058 8.98% 57,883 4,412 7.62% 34,398 2,419 7.03%
--------- ------- ---- -------- ------ ---- ------- ------ ----
Total earning assets . . . . 162,367 12,180 7.50% 106,608 6,708 6.29% 67,403 3,743 5.55%
--------- ------- ---- -------- ------ ---- ------- ------ ----

Cash and due from banks-
noninterest bearing . . . . 3,674 3,006 1,782
Allowance for possible
loan losses . . . . . . . . (770) (521) (293)
Premises and equipment, net. . 7,504 4,796 2,025
Other assets . . . . . . . . . 2,043 2,430 1,521
--------- -------- -------
Total Assets . . . . . . . . $ 174,818 $116,319 $72,438
========= ======== =======

LIABILITIES AND
SHAREHOLDERS' EQUITY

Deposits-interest bearing
NOW accounts . . . . . . . . $ 18,406 713 3.87% $ 6,505 174 2.67% $ 3,090 83 2.69%
Savings and money
market deposits . . . . . 50,813 2,020 3.98% 53,427 1,953 3.66% 38,326 1,303 3.40%
Time deposits . . . . . . . 76,202 4,681 6.14% 29,642 1,417 4.78% 13,583 518 3.81%
--------- ------- ---- -------- ------ ---- ------- ------ ----
Total interest-bearing
deposits . . . . . . . . . 145,421 7,414 5.10% 89,574 3,544 3.96% 54,999 1,904 3.46%
--------- ------- ---- -------- ------ ---- ------- ------ ----

Short-term borrowings . . . . 1,141 59 5.17% 4,960 200 4.03% 1,505 35 2.33%
Term-debt . . . . . . . . . . 3,125 276 8.83% 1,220 87 7.13% 0 0 --
--------- ------- ---- -------- ------ ---- ------- ------ ----
Total interest-bearing
liabilities . . . . . . . 149,687 7,749 5.18% 95,754 3,831 4.00% 56,504 1,939 3.43%
--------- ------- ---- -------- ------ ---- ------- ------ ----
Noninterest bearing deposits . 14,558 11,127 7,254
Other liabilities . . . . . . 407 245 164
Shareholders' equity . . . . . 10,166 9,193 8,516
--------- -------- -------
Total liabilities and
shareholders' equity . . . $ 174,818 $116,319 $72,438
========= ======== =======
Interest income/average
earning assets . . . . . . . 7.50% 6.29% 5.55%
Interest expense/average
interest-bearing
liabilities . . . . . . . . 5.18% 4.00% 3.43%
---- ---- ----
Net interest spread . . . . . $ 4,431 2.32% $2,877 2.29% $1,804 2.12%
======= ==== ====== ==== ====== ====
Net interest margin(1) . . . . 2.73% 2.70% 2.68%
==== ==== ====

(1) Net interest margin represents net interest income as a percentage of the
average earning assets during the period.

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96

1995 Compared to 1994 1994 Compared to 1993
---------------------------------------- ---------------------------------
Change Change Change Change
Due to Due to Total Due to Due to Total
Volume Rate Change Volume Rate Change
--------------- ------------ ----------- ----------- ---------- ----------

Interest-earning deposits with
banks . . . . . . . . . . . . . $ 502 $ 273 $ 775 $ 192 $ 105 $ 297
Federal funds sold . . . . . . . . 343 172 515 24 98 122
Taxable securities . . . . . . . . 417 257 674 495 58 553
Loans, net of discount . . . . . . 2,728 780 3,508 $ 1,775 218 1,993
------- ------- ------- ------- ------- -------
Total interest income . . . . $ 3,990 $ 1,482 $ 5,472 $ 2,468 $ 479 $ 2,965
------- ------- ------- ------- ------- -------
NOW accounts . . . . . . . . . . . 433 106 539 91 -- 91
Savings and money
market deposits . . . . . . . . (85) 152 67 546 104 650
Time deposits . . . . . . . . . . 2,763 501 3,264 740 159 899
Short-term borrowings . . . . . . (223) 82 (141) 125 40 165
Term debt . . . . . . . . . . . . 164 25 189 87 -- 87
------- ------- ------- ------- ------- -------
Total interest expense . . . . 3,052 866 3,918 1,589 303 1,892
------- ------- ------- ------- ------- -------
Net interest income . . . . . . $ 938 $ 616 $ 1,554 $ 897 $ 176 $ 1,073
======= ======= ======= ======= ======= =======

Volume variances are computed using the change in volume multiplied by
the previous year's rate. Rate variances are computed using the changes in
rate multiplied by the previous year's volume. The change in interest due to
both rate and volume has been allocated between the factors in proportion to
the relationship of the absolute dollar amounts of the change in each. Lake
Forest did not own any federally tax-advantaged securities during the periods
presented.

Provision for Possible Loan Losses. The provision for possible loan
losses increased from $240,000 in 1994 to $301,000 in 1995. Management
continued to provide for additions to the allowance for possible loan losses as
the loan portfolio increased approximately $40 million, or 58%, between the
year-end periods. At December 31, 1995, the allowance for possible loan losses
stood at 0.85% of loans outstanding which management feels is adequate to cover
potential losses in the portfolio. There can be no assurance that future
losses will not exceed the amounts provided for thereby affecting future
results of operations. Future additions to the allowance for possible loan
losses are dependent upon the economy, changes in real estate values, interest
rates, the view of regulatory agencies toward adequate reserve levels, and past
due and non-performing loan levels.

Other Noninterest Income. Noninterest income increased to $1,115,000
in 1995 from $649,000 in the previous year. Approximately $197,000 of the
increase was attributable to additional trust administration fees. In early
1995, the trust department added two new senior managers to oversee the trust
operations, investments, administration and new business development. These
individuals were responsible for generating additional trust business during
the course of 1995. Management expects further increases in trust revenue in
1996. Also, during 1995, Lake Forest Bank recorded approximately $125,000 in
fee income for services rendered to Libertyville Bancorp, Inc. and Wolfhoya
Investments, Inc. Lake Forest Bank contributed its marketing plans, data
processing file structure, new product development materials and other services
to assist these entities in establishing de novo bank operations. Fees on
loans sold increased approximately $74,000 in 1995 as compared to the prior
year. A favorable interest rate environment and an experienced lending officer
contributed to this increase. Fees on loans sold relate to income received by
Lake Forest Bank for its services of originating and selling residential real
estate loans into the secondary market. Service charges on deposit accounts
increased from $105,000 in 1994 to $146,000

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97

in 1995, or approximately $41,000, primarily as a result of the rapid growth in
the retail deposit base. The level of service charges received on deposit
accounts is substantially below peer group levels as management believes in the
philosophy of providing high quality service without encumbering that service
with numerous activity charges. That philosophy has contributed to the strong
growth in retail deposits. The remaining increase in noninterest income is a
result of a variety of less material items.

Noninterest Expense. Noninterest expenses include all expenses other
than interest expense and the provision for possible loan losses. The
following table provides a detailed analysis of the composition of these
expenses (in thousands).

For the Year
Ended December 31,
---------------------- Dollar Percentage
1995 1994 Change Change
---------- --------- ------ ----------

Salaries and employee benefits . . . . . . . . . $2,283 $1,436 $ 847 59.0%
Occupancy expenses . . . . . . . . . . . . . . . 394 223 171 76.7%
Advertising and marketing . . . . . . . . . . . . 234 152 82 53.9%
Data processing . . . . . . . . . . . . . . . . . 314 211 103 48.8%
Insurance . . . . . . . . . . . . . . . . . . . . 222 239 (17) (7.1%)
Other noninterest expenses . . . . . . . . . . . 955 517 438 84.7%
------ ------ ------ -----
Total noninterest expenses . . . . . . . . . . $4,402 $2,778 $1,624 58.5%
====== ====== ====== ====

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. The opening of two new branch banking
facilities and the continuing expansion of the deposit base by 44% were largely
responsible for the growth in salaries and employee benefits. In December of
1994, a branch was established in the neighboring community of Lake Bluff,
approximately four miles to the north of Lake Forest Bank's main offices.
Located six miles to the south and west, another branch was opened in May of
1995. The additional facilities required expanding the payroll by ten
full-time equivalent employees. The addition of many new accounts and the
increased utilization of established relationships also contributed to the need
for more support staff. Also, annual salary and wage increases were partially
responsible for the increase in salaries. As of December 31, 1995, Lake Forest
Bank had a ratio of $3.82 million of assets per full-time equivalent employee
as compared to a ratio $2.07 million of assets per full- time equivalent
employee for its peer group. This places Lake Forest Bank in the 97th
percentile of its peer group. Lake Forest has a philosophy of paying a fewer
number of highly effective individuals a salary that is at a premium over
market rates rather than staffing at higher peer group levels. Management
believes that this staffing philosophy is effective in attracting talented
individuals and achieving high levels of productivity.

Occupancy Expenses. The opening of the two new branch facilities
during 1995 as discussed in the preceding paragraph added an additional $67,000
of lease rental expense during the year ended December 31, 1995. These two new
facilities also resulted in additional occupancy related expenses such as
depreciation on leasehold improvements, maintenance and repairs, utilities and
other miscellaneous expenses related to the premises. Also, 1995 included a
full year of occupancy of Lake Forest Bank's permanent banking facilities which
were occupied beginning in April of 1994 compared to only eight full months in
the prior year.

Advertising and Marketing. Marketing and advertising expenditures
amounted to $234,000 during 1995 compared to $152,000 in 1994. The increase in
this category can be primarily attributed to the opening of the two new branch
banking facilities during 1995 and the desire of management to effectively
integrate the opening of those facilities into the overall marketing plan of
Lake Forest Bank. Lake Forest Bank has traditionally developed community
oriented deposit and loan products and considers the marketing expenses as an
instrumental part in achieving the growth in the deposit base. Management
anticipates that relatively similar levels of marketing expenses will be
incurred in 1996 as Lake Forest Bank continues to pursue its objective of
increasing its base of customers.

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98

Data Processing. Data processing expenses increased by approximately
$103,000 or 48.8% for the year ended December 31, 1995 compared to the results
for the year ended December 31, 1994. Data processing expenses are highly
dependent on the number of accounts processed by Lake Forest Bank. As such,
the increase during 1995 in deposit and loan balances of approximately 44% and
58%, respectively, was the primary reason for the increase in this expense
category. Additionally, data processing charges related to account processing
for the trust department is included in this expense category. As a result,
the increase in trust accounts during 1995 translated into higher data
processing charges.

Insurance. Insurance expense represents costs incurred to secure
insurance policies for risks associated with the physical properties, fidelity
concerns, director and officer liability, deposit insurance supplied by the
Federal Deposit Insurance Corporation (FDIC), and other sundry insurance
products. The decline in this expense category is a function of a significant
decrease in the level of premiums charged by the FDIC during 1995. Lake Forest
Bank recorded approximately $143,000 and $192,000 of insurance expense related
to FDIC deposit insurance in 1995 and 1994, respectively. Lake Forest Bank
anticipates incurring only $2,000 in FDIC deposit insurance expense in 1996 as
a result of the restructuring of the deposit insurance rates. Offsetting the
decline in FDIC insurance was a general increase in premiums associated with
Lake Forest Bank's other insurance policies. Many of Lake Forest's insurance
policies have premium rates that are based partly upon the number of employees
and the total deposit and asset levels of Lake Forest Bank. Due to the
increase in these areas during 1995, the cost of some of the other insurance
policies increased.

Other Noninterest Expenses. Other noninterest expenses increased to
$955,000 for the year ended December 31,1995 from $517,000 for the year ended
December 31,1994. This category of expenses represents stationery and supplies
expense, loan origination expenses, postage expense, audits and examinations
expense, and other sundry expenses. The increase in this category is a general
increase of all of the above categories primarily due to the higher volume of
accounts outstanding and the additional depreciation, supplies, and other
sundry expenses related to the opening of the new branch facilities. For
example, depreciation expense on furniture and equipment increased by $104,000
as a result of furnishing the new facilities with desks, computers, other
furnishings and a full year of depreciation expense on the furnishings of the
main bank facility which was occupied in April of 1994. Also, stationery and
supplies expense increased approximately $52,000 due to the additional supplies
necessary to operate the two new branch banking facilities. Controlling
overhead expenses is a basic philosophy of management and is closely evaluated.
Management is committed to continually evaluating its operations to determine
whether additional expense savings are possible without impairing the goal of
providing superior customer service.

Despite the increases in the various noninterest expense categories
during 1995, Lake Forest's ratio of noninterest expenses to total average
assets was 2.52% of average assets in 1995 compared to its peer group that has
a ratio of noninterest expenses to total average assets of approximately 3.51%.
Thus, Lake Forest Bank has controlled its noninterest expenses in a fashion
which is admirable when compared to other banks in its peer group.

Income Taxes. Lake Forest had no Federal or state income tax expense
for 1995 or 1994. In 1995, an income tax benefit of $172,000 was recorded as
management determined that the realization of certain deferred tax assets not
previously valued was more likely than not to occur. In 1994, management had
established a valuation allowance against its net deferred tax assets with the
result being that no Federal or state income tax expense or benefit was
realized in the financial statements. However, in 1995, management determined
that its earnings history and projected future earnings were sufficient to make
a judgment that the realization of the net deferred tax asset was more likely
than not. As such, an income tax benefit was recorded to the extent that no
valuation allowance was required to offset any deferred tax assets.

Comparison of Results for the Years Ended December 31, 1994 and December 31,
1993

General. Lake Forest had net income of $508,000 for the year ended
December 31,1994, compared with $200,000 for the year ended December 31,1993.
The increase in net income was due to an increase in net interest income of
$1,073,000, offset by a slight decrease in the noninterest income of $134,000
and an increase in other

78
99

noninterest expenses of $631,000. These and other details will be discussed in
greater detail in the following sections.

Interest Income and Interest Expense. Interest income increased from
$3,743,000 in 1993 to $6,708,000 in 1994. This 79% increase in interest income
was attributable to (1) a 58% increase in average earning assets; (2) a shift
in the earning assets mix such that higher yielding loans comprised a larger
portion of total earning assets; and (3) a general rise in interest rates
during 1994.

Interest expense increased from $1,939,000 in 1993 to $3,831,000 in
1994. The near doubling of interest expense was attributable to a 69% increase
in interest-bearing liabilities and a general rise in interest rates paid to
depositors during 1994.

A complete analysis of the components and characteristics of interest
income and interest expense is shown in the average balance/rate table
presented previously. Also, changes in interest income and expense due to
fluctuations in the rate environment and volume levels is presented in the
section above titled "Changes in Interest Income and Expense".

Provision for Possible Loan Losses. The provision for possible loan
losses totaled $240,000 in 1994 and 1993. Management continued to provide for
additions to the allowance for possible loan losses as the loan portfolio
increased approximately $24.8 million between the year-end periods. At
December 31, 1994, the allowance for possible loan losses stood at 0.91% of
loans outstanding which management determined was adequate to cover potential
losses in the portfolio.

Other Noninterest Income. Noninterest income decreased to $649,000 in
1994 from $783,000 in 1993, or approximately $134,000. The primary reason for
the decline was a result of approximately $276,000 less from fees on loans sold
in 1994 as compared to 1993. Fees on loans sold relate to income received by
Lake Forest Bank for its services of originating and selling residential real
estate loans into the secondary market. The income derived from these sales is
highly dependent on the volume of real estate sales transactions and
refinancing activity. As such, the business is sensitive to the interest rate
environment and other economic conditions. When market interest rates begin to
decline until the time that they level off, is the period in which the greatest
number of consumer mortgage refinancings can be anticipated. As rates
stabilize or rise, the pool of seasoned higher coupon mortgage loans suitable
for refinance diminishes. Accordingly, because interest rates began an upward
trend in 1994, the number of loans which actually benefited from refinancing
diminished and fee income declined also. Offsetting the decline from fees on
loans sold was an increase in trust administration fees of approximately
$110,000 to $202,000 in 1994. The increase in trust fees was primarily due to
the fact that 1994 was the second full year of trust services and the trust
department was continuing its growth by effectively marketing itself to the
community. The remaining change in noninterest income was a result of a slight
increase in service charges on deposit accounts and other income.

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FOR THE YEAR
ENDED DECEMBER 31,
----------------------- DOLLAR PERCENTAGE
1994 1993 CHANGE CHANGE
----------- ------------- ------------- --------------

Salaries and employee benefits . . . . . . . . . . $1,436 $1,179 $257 21.8%
Occupancy expenses . . . . . . . . . . . . . . . . 223 190 33 17.4%
Advertising and marketing . . . . . . . . . . . . . 152 106 46 43.4%
Data processing . . . . . . . . . . . . . . . . . . 211 158 53 33.5%
Insurance . . . . . . . . . . . . . . . . . . . . . 239 151 88 58.3%
Other noninterest expenses . . . . . . . . . . . . 517 363 154 42.4%
------ ------ ---- ----
Total noninterest expenses . . . . . . . . . . . $2,778 $2,147 $631 29.4%
====== ====== ==== ====

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. The primary contributor to the
increase in salaries and employee benefits expense of $257,000 from 1993 to
1994 was the additional staffing required to open Lake Forest Bank's permanent
offices at 727 North Bank Lane in Lake Forest, Illinois. The improved facility
and aggressive marketing resulted in deposit and loan growth of approximately
54.8% and 54.6%, respectively, from year-end 1993 to year-end 1994. The growth
in loans and deposits resulted in the need for additional employees to
appropriately service the accounts. Also, normal annual salary and wage
increases contributed to the increase.

Occupancy Expenses. Occupancy expenses increased approximately
$33,000, or 17.4% for the year ended December 31, 1994 compared to the year
ended December 31, 1993. The move to the new 18,000 square foot permanent
offices in April 1994 and the growth as described in the preceded paragraph
accounted for the growth in this expense category.

Advertising and Marketing. The majority of the $46,000 increase in
advertising and marketing expense from year-end 1993 to year-end 1994 is
directly attributable to the opening of Lake Forest Bank's permanent offices.
A myriad of promotions were employed to mark the event. Events included such
festivities as a series of open houses for local dignitaries and community
leaders and an outdoor carnival for children and families. All of the
promotional events were designed to draw attention to Lake Forest Bank at a
important time in its growth cycle.

Data Processing. Data processing expenses increased by approximately
$53,000 or 33.5% for the year ended December 31, 1994 compared to the results
for the year ended December 31, 1993. Data processing expenses are highly
dependent on the number of accounts processed by Lake Forest Bank. As a
result, the increase during 1994 in both deposit and loan balances of
approximately 55% was the primary reason for the increase in this expense
category.

Insurance. For the year ended December 31, 1994, insurance expense
increased to approximately $239,000 from $151,000 in the prior year, or a 58.3%
increase. This increase is primarily a result of the additional premiums paid
for FDIC insurance. During 1993 and 1994, Lake Forest Bank paid deposit
insurance premiums based upon the amount of deposits and certain other factors.
Because of the substantial increase in deposit balances, the expense related to
FDIC deposit insurance increased by approximately $79,000 in 1994 from 1993.
The remainder of the increase was a result of slightly higher premium amounts
for Lake Forest Bank's other insurance policies due to the growth in the level
of employees and assets.

Other Noninterest Expenses. Other noninterest expenses increased to
approximately $517,000 for the year ended December 31, 1994 from approximately
$363,000 for the year ended December 31, 1993. This increase represents a
42.4% increase in 1994 from 1993. No individual expense category stands for
any significant portion of the increase. Rather the increase relates primarily
to the growth in loans and deposits and the requisite additional sundry
expenses associated with that growth.

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101

Notwithstanding the increase in each of the noninterest expense
categories, Lake Forest's ratio of noninterest expenses as a percent of average
assets in 1994 was approximately 2.39% which was substantially below its peer
group's 1994 level of 3.26%.

Income Taxes. Lake Forest recorded no income tax expense or benefit
for the years ended December 31, 1994 and 1993. The net operating losses
generated during the initial years of operation were available to be carried
forward to offset income in these years.

FINANCIAL CONDITION

The dynamics of a community bank's balance sheet is generally
dependent upon the ability of management to attract additional deposit accounts
to fund the growth of the institution. This is the current situation at Lake
Forest Bank as it has recently expanded the number of banking facilities in its
delineated service area and is still diligently attempting to solidify itself
as the bank that the constituents of the communities select as their preferred
bank. Accordingly, the discussion of the financial condition of Lake Forest
Bank will focus first on the sources of funds received through the liability
side of the balance sheet which is predominantly deposit growth. After it is
understood how Lake Forest Bank was funded during the periods under discussion,
the latter section of this "Financial Condition" discussion will focus on the
asset categories where Lake Forest invested the funds.

Deposits. Total deposits balances increased to $200,021,000 at March
31, 1996 compared to $181,186,000 at December 31, 1995 and $126,067,000 at the
end of 1994. This follows a $44,615,000 increase in deposits in 1994 from the
$81,452,000 deposit level at the end of 1993. The following table presents the
balances of deposits by category and those categories' relative percentage of
the total deposits at March 31, 1996 and at December 31 during the past three
years (dollars in thousands).

March 31, 1996 December 31, 1995 December 31, 1994 December 31, 1993
--------------------- -------------------------------------------- ---------------------
Percent Percent Percent Percent
Balance of Total Balance of Total Balance of Total Balance of Total
---------- ---------- ---------- ----------- ---------- ---------- ---------- ----------

Demand . . . . . . . . . . . . $ 17,094 8.5% $ 16,930 9.3% $ 13,787 10.9% $ 13,664 10.9%
Savings . . . . . . . . . . . . 26,235 13.1% 26,208 14.5% 30,280 24.0% 27,054 24.0%
NOW . . . . . . . . . . . . . . 23,692 11.9% 22,287 12.3% 9,903 7.9% 4,306 7.9%
Money market . . . . . . . . . 30,589 15.3% 25,469 14.1% 23,650 18.8% 18,906 18.8%
Certificates of deposit . . . . 102,411 51.2% 90,292 49.8% 48,447 38.4% 17,522 38.4%
-------- ----- -------- ----- -------- ----- -------- -----
Total Deposits . . . . . . $200,021 100.0% $181,186 100.0% $126,067 100.0% $ 81,452 100.0%
======== ===== ======== ===== ======== ===== ======== =====

With the exception of savings accounts, all deposit categories have
exhibited positive growth trends for the periods presented above. Although the
stratification of the deposit categories is somewhat typical of a community
bank's balance sheet, two categories stand out in particular. In January,
1995, Lake Forest Bank was the successful bidder and was able to garner the
banking relationship of the municipality in which Lake Forest Bank has its
headquarters. The dramatic increase in the NOW account balances since 1994 is
directly attributable to that municipality's deposit accounts. Certificates of
deposit is the second area displaying unusually rapid growth. In late 1992,
Lake Forest Bank introduced a variable rate certificate of deposit account
whose rate was indexed to the U.S. Treasuries yield. This product has proven
to be highly successful contributing approximately $36 million to the overall
increase in the balances from 1993 to 1995. The modest reduction in savings
balances from 1994 to 1995 resulted from customers' desire to lock in higher
rates of return on term certificates of deposit.

Reference is made to the average balance/rate table for data regarding
average daily deposits and rates paid thereon for each of the three years ended
December 31, 1995. Lake Forest Bank has no foreign deposits.

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The aggregate amounts of time deposits, in denominations of $100,000
or more, by maturity, as of December 31, 1995 are shown below (in thousands):

Three months or less . . . . . . . . . . . . . $24,135
Over three through six months . . . . . . . . . 5,158
Over six through twelve months . . . . . . . . 9,909
Over twelve months . . . . . . . . . . . . . . 4,452
-------
Total . . . . . . . . . . . . . . . . . . . $42,835
=======

Accrued Interest and Other Expenses, Treasury Tax and Loan and Other
Liabilities. The collective balances of these financial statement categories
as of December 31, 1995, 1994, and 1993 were $1,088,000, $900,000, and
$660,000, respectively. The increase can be primarily attributed to a higher
amount of accrued interest payable on deposit accounts due to the significant
growth in the level of deposits. No other significant changes were present in
these financial statement categories.

Total Assets and Earning Assets. Total assets and earning assets were
$197,140,000 and $183,765,000, respectively, at December 31, 1995 compared to
$144,155,000 and $129,993,000, respectively, at December 31, 1994. The
increase in total assets and earning assets during the year was a result of
continued growth in the deposit categories discussed above. The level of
earning assets as a percentage of total assets increased to approximately 93%
of total assets at December 31, 1995 from approximately 90% at December 31,
1994. This increase in the level of earning assets occurred because Lake
Forest Bank was able to reduce the ratio of capital required to support total
assets. Lake Forest Bank, as a de novo bank, was required to maintain a 9%
leverage ratio during its first three years of operation; however, this
requirement expired in December 1994 (see discussion of capital in the
"Shareholders' Equity" section below). Additionally, the composition of
earning assets shifted as Lake Forest Bank increased the level of deposit funds
invested into loans from shorter-term money market investments. Loans
comprised 60.2% of total earning assets at December 31, 1995 compared to 54.0%
at December 31, 1994. These changes in the mix of earning assets will be
discussed further below.

Loans. The following table shows Lake Forest's loans at March 31,
1996 and as of December 31 for the previous five fiscal years (in thousands):

December 31,
March 31, ----------------------------------------------------------
1996 1995 1994 1993 1992 1991
-------------- ---------- ----------- ----------- ----------- -----------

Residential real estate . . . . . $ 25,174 $ 19,500 $ 19,260 $ 14,095 $ 9,020 $ --
Commercial . . . . . . . . . . . 57,098 52,811 31,852 13,537 4,659 --
Home equity . . . . . . . . . . . 21,223 23,239 15,455 12,892 6,351 --
Consumer . . . . . . . . . . . . 17,580 15,146 3,691 4,926 3,140 --
-------- -------- -------- -------- -------- -------
Total gross loans . . . . . . . . 121,075 110,696 70,258 45,450 23,171 --
Less: unearned discount . . . . 20 23 -- -- -- --
-------- -------- -------- -------- -------- -------
Net loans . . . . . . . . . . . . $121,055 $110,673 $70,258 $45,450 $ 23,171 $ --
======== ======== ======= ======= ======== =======

Total net loans increased to $110,673,000 at December 31, 1995 from
$70,258,000 at December 31, 1994. As can be seen from the table above, growth
occurred in all loan types during 1995. The following paragraphs will
highlight the growth by loan type.

The commercial loan category exhibited the larger dollar increase from
year-end 1994 to year-end 1995 of $20,959,000. The commercial loan component
is comprised primarily of commercial real estate loans, working capital lines
of credit, and equipment financing. Commercial real estate is predominantly
owner occupied and secured by a first mortgage lien and assignment of rents on
the property. Equipment loans are fully amortized over 24 to 60 months and
secured by titles and/or U.C.C. filings. Working capital lines are renewable
annually and

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supported by business assets, personal guarantees and often some sort of
additional collateral. The vast majority of commercial loans are made within
Lake Forest Bank's immediate market area. The increase can be attributed to an
emphasis on business development calling programs and aggressive servicing of
existing commercial loan customers which has increased referrals.

The outstanding level of home equity loans increased $7,784,000 during
1995. The growth was a result of several promotional home equity loan products
that were offered during the year. The special home equity loan products
featured competitive rates structures and fee arrangements. These loans are
generally secured by first or second position mortgage liens on the underlying
property with loan-to-value ratios not exceeding 80%.

Consumer loan increased approximately $11,455,000 million from
December 31, 1994 to December 31, 1995. Approximately $10.4 million of this
increase is related to the purchase of fixed rate indirect automobile loans.
These indirect automobile loans are purchased from Hinsdale Bank and Trust
Company, an affiliated bank, and are loans secured by new and used automobiles.
These credits generally have an original maturity of 36 to 60 months; however,
the average actual maturity is estimated to be approximately 37 months. The
risk associated with this portfolio is diversified amongst many individual
borrowers.

The residential real estate category continues to increase and
includes adjustable rate mortgages that have repricing terms from one to three
years, construction loans to individuals, and bridge financing loans for
qualifying customers. Lake Forest Bank does not generally originate loans for
its own portfolio with long-term fixed rates due to interest rate risk
considerations. However, Lake Forest Bank does accommodate customer requests
for these fixed rate loans by originating and selling the loans in the
secondary market for which Lake Forest Bank receives a fee.

Lake Forest has no loans to businesses or governments of foreign
countries.

Money Market Investments and Investment Securities. Lake Forest
Bank's objective in managing its securities portfolio is to balance Lake Forest
Bank's liquidity risk, interest rate risk and credit quality such that the
earnings of Lake Forest Bank are maximized. As noted in the "Loans" section
above, the predominant portion of the funds received from new deposit accounts
was invested in the various loan categories during 1995. Management has
maintained the funds that were not invested in loans in short-term investment
securities and money market investments as follows (in thousands):

December 31,
March 31, ----------------------------------
1996 1995 1994
---------------- ----------------- ----------------

Federal funds sold . . . . . . . . . . . . . . . . . . . $18,855 $ 13,100 $ 7,135
Interest bearing deposits with Bank . . . . . . . . . . . 100 21,100 16,699
Investment securities . . . . . . . . . . . . . . . . . . 62,467 38,892 35,801
------ ------ ------
Total money market investments and
investment securities . . . . . . . . . . . . . . . . $81,422 $ 73,092 $59,635
====== ====== ======

Investment Securities. The carrying value of securities held by Lake
Forest at December 31, are presented by category as follows (in thousands):

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1995 1994 1993
---- ---- ----

Available-for-Sale
U.S. Treasury obligations . . . . . $ -- $ -- $ 4,919
U.S. agency obligations . . . . . . 12,972 -- --
Other securities . . . . . . . . . 18,655 4,773 9,390
Federal Reserve Bank stock . . . . 316 290 256
Equity securities . . . . . . . . . 1,947 854 --
------- ------- -------
Total available-for-sale . . . . 33,890 5,917 14,565
------- ------- -------
Held-to-Maturity
U.S. Treasury obligations . . . . . 5,002 10,009 --
U.S. agency obligations . . . . . . -- 19,975 9,432
Other securities . . . . . . . . . -- -- --
Equity securities . . . . . . . . . -- -- --
-- -- --
Total held-to-maturity . . . . . . 5,002 29,984 9,432
------- ------- -------
Total securities . . . . . . . . . $38,892 $35,901 $23,997
======= ======= =======

Maturities of securities as of December 31, 1995 are as follows (in thousands):

Within From 1 From 5 to After Equity
1 Year to 5 Years 10 years 10 Years Securities Total
---------- ------------ ----------- ---------- ------------ -----------

U.S. Treasuries . . . . . $ -- $ 5,002 $ -- $ -- $ -- $ 5,002
U.S. agency obligations . 10,481 2,491 -- -- -- 12,972
Other securities . . . . 14,610 4,045 -- -- -- 18,655
Federal Reserve Bank . . -- -- -- -- 316 316
Stock equity . . . . . . -- -- -- -- 1,947 1,947
------- ------- ------ -------- ------ -------
Total . . . . . . . . $25,091 $11,538 $ -- $ -- $2,263 $38,892
======= ======= ====== ======== ====== =======

The weighted average yield for each range of maturities of securities is shown
below as of December 31, 1995:

Within From 1 From 5 to After Equity
1 Year to 5 Years 10 years 10 Years Securities Total
---------- ------------ ----------- ---------- ------------ -----------

U.S. Treasuries . . . . . -- 5.00% -- -- -- 5.00%
U.S. agency obligations . 5.78% 5.19% -- -- -- 5.67%
Other securities . . . . 5.73% 6.07% -- -- -- 5.98%
Federal Reserve Bank . . -- -- -- -- 6.00% 6.00%
Equity securities . . . . N/A N/A N/A N/A N/A N/A

Yields on equity securities are not considered meaningful for purposes of this
analysis.

Lake Forest did not own any federally tax-advantaged securities during
the periods presented.

There were no securities of any single issuer which had book value in
excess of 10% of shareholders' equity at December 31, 1995.

Shareholders' Equity. The following table reflects various measures
of capital at March 31, 1996 and at year-end 1995 and 1994 for Lake Forest:

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DECEMBER 31,
MARCH 31, --------------------------------
1996 1995 1994
-------------- -------------- ---------------

Ending tier 1 risk-based ratio . . . . . . 8.0% 8.4% 12.0%
Ending total risk-based capital ratio . . . 8.7% 9.2% 12.8%
Ending leverage ratio . . . . . . . . . . . 5.1% 5.5% 6.5%
Dividend payout ratio . . . . . . . . . . . 0.0% 0.0% 0.0%

The leverage ratios and tier 1 risk-based capital ratios exceed the
"well capitalized" levels established by regulatory agencies of 5% and 6%,
respectively. The total risk-based capital ratios exceed the regulatory
agencies' threshold for an "adequately capitalized" institution.

Management is not aware of any known trends, events, regulatory
recommendations or uncertainties that will have any adverse effect on Lake
Forest's capital resources or operations.

ASSET-LIABILITY MANAGEMENT

As a continuing part of its financial strategy, Lake Forest attempts
to manage the impact of fluctuations in market interest rates on its net
interest income. This effort entails providing a reasonable balance between
interest rate risk, credit risk, liquidity risk and maintenance of yield.
Asset-liability management policies are established and monitored by management
in conjunction with the Board of Directors. The policy establishes guidelines
for acceptable limits on the sensitivity of the market value of assets and
liabilities to changes in interest rates.

The following table illustrates Lake Forest's estimated interest rate
sensitivity and periodic and cumulative gap positions as calculated as of March
31, 1996. An institution with more assets repricing than liabilities over a
given timeframe is considered asset sensitive and will generally benefit from
rising rates.

0-90 91-365 1-5 OVER 5
DAYS DAYS YEARS YEARS TOTAL
-------------- ------------ ------------ ------------ ------------
(DOLLARS IN THOUSANDS)

Total assets . . . . . . . . . . . . . . $ 126,171 $ 33,745 $ 34,522 $ 21,912 $ 216,350
Total liabilities and equity . . . . . . 127,614 25,171 11,841 51,724 216,350
------- ------- ------- --------
Interest sensitivity gap . . . . . . . . $ (1,443) $ 8,574 $ 22,681 $ (29,812)
======== ======== ======== =========

Cumulative interest sensitivity gap. . . $ (1,443) $ 7,131 $ 29,812
Ratio of cumulative rate sensitivity gap
to rate sensitive assets . . . . . . . (.67)% 3.32% 13.9%
Cumulative ratio of rate-sensitive assets
to rate-sensitive liabilities . . . . . 98.87% 104.67% 118.11% 100.00%

To protect the net interest margin from the volatility of the business
cycle, particular attention is given to managing the interest rate spread
between the yield on earning assets and the cost of funds. Management has
determined that this can best be achieved by maintaining a balance sheet with
an asset sensitive posture. The table shown above depicts an interest rate
sensitivity position consistent with management's philosophy.

LIQUIDITY

At the Bank Level. Liquidity management involves planning to meet
anticipated funding needs at a reasonable cost. Liquidity management is guided
by policies formulated and monitored by Lake Forest Bank's Asset/Liability
Committee, which take into account the marketability of assets, the sources and
stability of funding and the level of unfunded commitments.

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106

"Liquid assets" refers to money market assets such as Federal funds
sold and interest bearing deposits with banks, as well as available-for-sale
debt securities and held-to-maturity securities with a remaining maturity of
less than one year. Net liquid assets would represent the sum of the liquid
asset categories less the amount of assets pledged to secure public funds. At
December 31, 1995, net liquid assets totaled approximately $50 million,
compared to approximately $32 million at December 31, 1994. Thus, Lake Forest
Bank has substantial short-term balance sheet liquidity.

Long-term liquidity needs are provided by a large core deposit base,
which is the most stable source of liquidity a community bank can have due to
the long-term relationships established with the depositors and the security of
deposit insurance provided by the Federal Deposit Insurance Corporation. At
December 31, 1995, 64% of total assets were funded by core deposits with
balances less than $100,000 while the remaining assets were funded by other
funding sources such as core deposits with balances in excess of $100,000,
public funds, purchased funds, and the capital of Lake Forest Bank. At
December 31, 1994, 63% of total assets were funded by core deposits.

Lake Forest Bank routinely accepts deposits from a variety of
municipal entities. Typically, these municipal entities require that banks
pledge marketable securities to collateralize these public deposits. At
December 31, 1995 and 1994, Lake Forest Bank had approximately $20,500,000 and
$9,800,000 of such public deposits, respectively. These assets are not
considered to be core deposits and the assets that are pledged as collateral
for these deposits are not deemed to be liquid assets.

At the Holding Company Level. Lake Forest's principal funds are
dividends from Lake Forest Bank subsidiary, and if necessary, borrowings or
additional equity offerings. Banking laws place restrictions upon the amount
of dividends which can be paid to Lake Forest by Lake Forest Bank. Based on
these laws, Lake Forest Bank could, subject to minimum capital requirements,
declare dividends to Lake Forest without obtaining regulatory approval in an
amount not exceeding (a) undivided profits, and (b) the amount of net income
reduced by dividends paid for the current and prior two years. At January 1,
1996, $1,007,000 was available as dividends from the subsidiary Bank without
prior regulatory approval, compared with no dividend availability from the
subsidiary Bank at December 31, 1994. No cash dividends were paid to Lake
Forest by the subsidiary during the periods ended December 31, 1995, 1994, or
1993.

Nonaccrual, Past Due and Restructured Loans. Nonaccrual loans at
December 31 are as follows (in thousands):

December 31,
March 31, -----------------------------------------------------------
1996 1995 1994 1993 1992 1991
-------------- ---------- --------- --------- --------- ----------

Nonaccrual loans . . . . . . . $0 $ 150 $0 $0 $0 $0
Nonaccrual loans to total
loans . . . . . . . . . . . 0% 0.14% 0% 0% 0% 0%

It is the policy of Lake Forest to discontinue the accrual of interest
income on any loan for which there is a reasonable doubt as to the payment of
interest or principal. Nonaccrual loans are returned to an accrual status when
the financial position of the borrower indicates there is no longer any
reasonable doubt as to the payment of principal or interest. Other than those
loans indicated above, Lake Forest had no significant loans (i) for which the
terms of had been renegotiated, or (ii) for which there were serious doubts as
to the ability of the borrower to comply with repayment terms.

The table below sets forth loans past due 90 days or more, including
nonaccrual loans, at the dates shown (in thousands):

March 31, December 31,
-------------------------------------------------------
1996 1995 1994 1993 1992 1991
-------------- --------- -------- --------- -------- ---------

Loans past due 90 days
or more . . . . . . . . . . . $0 $187 $13 $0 $0 $0

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Potential Problem Loans. In addition to those loans disclosed under
"Nonaccrual, Past Due and Restructured Loans," there are certain loans in the
portfolio which management has identified, through its problem loan
identification system, which exhibit a higher than normal credit risk.
However, these loans do not represent non-performing loans to Lake Forest.
Management's review of the total loan portfolio to identify loans where there
is concern that the borrower will not be able to continue to satisfy present
loan repayment terms includes factors such as review of individual loans,
recent loss experience and current economic conditions. Loans in this category
include those with characteristics such as those past maturity more than 45
days, those that have recent adverse operating cash flow or balance sheet
trends, or have general risk characteristics that the loan officer feels might
jeopardize the future timely collection of principal and interest payments.
The principal amount of loans in this category as of December 31, 1995 was
approximately $177,000. Loans in this category generally include loans that
were classified for regulatory purposes. At December 31, 1995, there were no
significant loans which were classified by any bank regulatory agency that are
not included above as nonaccrual, past due or restructured.

Loan Concentrations. Loan concentrations are considered to exist when
there are amounts loaned to a multiple number of borrowers engaged in similar
activities which would cause them to be similarly impacted by economic or other
conditions. At December 31, 1995, Lake Forest had no concentrations of loans
exceeding 10% of total loans.

Other Real Estate Owned. In addition to the risk elements identified
above, Other Real Estate Owned would provide insight into the historical
quality of the loan portfolio. Lake Forest has had no Other Real Estate Owned
during any of the reporting periods.

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THREE MONTHS
ENDED YEARS ENDED DECEMBER 31, PERIOD ENDED
MARCH 31, ---------------------------------------------- DECEMBER 31,
1996 1995 1994 1993 1992 1991
-------------- ---------- ---------- ---------- ---------- --------------

Balance at beginning of year $ 938 $ 642 $ 422 $ 182 $ -- $ --

LOANS CHARGED-OFF:
Residential real estate . . . -- -- -- -- -- --
Commercial . . . . . . . . . -- -- (20) -- -- --
Home Equity . . . . . . . . . (96) -- -- -- -- --
Consumer . . . . . . . . . . (2) (5) -- -- -- --
-------- ------- ------- ------- ------- ------
Total charge-offs . . . . . . (98) (5) (20) -- -- --
-------- ------- ------- ------- ------- ------
RECOVERIES:
Residential real estate . . . -- -- -- -- -- --
Commercial . . . . . . . . . -- -- -- -- -- --
Home Equity . . . . . . . . . -- -- -- -- -- --
Consumer . . . . . . . . . . -- -- -- -- -- --
-------- ------- ------- ------- ------- ------
Total recoveries . . . . . . -- -- -- -- -- --
-------- ------- ------- ------- ------- ------
Net loans (charged-off) or
recovered . . . . . . . . (98) (5) (20) -- -- --
-------- ------- ------- ------- ------- ------

Add: Provision for possible
loan losses . . . . . . . 110 301 240 240 182 --
-------- ------- ------- ------- ------- ------
Balance at end of year . . . $ 950 $ 938 $ 642 $ 422 $ 182 $ --
======== ======= ======= ======= ======= ======

Average loans outstanding . . $112,388 $89,764 $57,883 $34,398 $12,287 $ --
======== ======= ======= ======= ======= ======
Ratio of net charge-offs
during the period to
average loans outstanding
during the period . . . . 0.1% 0.0% 0.0% 0.0% 0.0% 0.0%
=== === === === === ===

As of December 31, 1995, management allocated the allowance for
possible loan losses by specific category as shown in the following table (in
thousands). The allocation was made after considering all relevant qualitative
and quantitative factors about the loan portfolio.

PERCENT OF
LOANS IN EACH
CATEGORY TO
AMOUNT TOTAL LOANS
------ -------------------

Residential real estate . . . . . . . . . $ 16 17%
Commercial . . . . . . . . . . . . . . . 290 48%
Home equity . . . . . . . . . . . . . . . 128 21%
Consumer . . . . . . . . . . . . . . . . 84 14%
Unallocated . . . . . . . . . . . . . . . 420 N/A
---- ---
Total . . . . . . . . . . . . . . . . . $938 100%
==== ===

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109
concentration in any specific risk area. Control of the loan quality is
continually monitored by management and is reviewed by the Board of Directors
and its Credit Committee on a monthly basis. Independent external review of
the loan portfolio is provided by the examinations conducted by regulatory
authorities, independent public accountants in conjunction with their annual
audit, and an independent loan review performed by an entity engaged by the
Board of Directors. The amount of additions to the allowance for possible loan
losses which are charged to earnings through the provision for possible loan
losses are determined based on a variety of factors, including actual
charge-offs during the year, historical loss experience, delinquent loans, and
an evaluation of current and prospective economic conditions in the market
area. Management believes the allowance for possible loan losses is adequate
to cover any potential losses.

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110

HINSDALE BANCORP, INC.

BUSINESS

Organization and Operation. Hinsdale Bancorp, Inc. ("Hinsdale") is a
bank holding company that was incorporated as an Illinois corporation in
December of 1992. The primary asset of Hinsdale is its ownership of 100% of
the common shares of Hinsdale Bank. Hinsdale is engaged in the business of
banking through its ownership of Hinsdale Bank. Its mailing address is 25 East
First Street, Hinsdale, Illinois 60521 and its telephone number is (708)
323-4404. As of March 31, 1996, Hinsdale had total assets of $118,545,000 and
total stockholders' equity of $9,776,000.

Hinsdale Bank was organized under the laws of the State of Illinois
and commenced operation in October, 1993. Hinsdale and Hinsdale Bank are
regulated by the Federal Reserve Bank. Additionally, Hinsdale Bank is
regulated by the CBTC and the FDIC.

Hinsdale Bank is the only locally owned and managed full service
commercial bank in its primary service area of Hinsdale, Illinois and Clarendon
Hills, Illinois. The Village of Hinsdale is located approximately 17 miles
west of the downtown Chicago area and has a population of approximately 17,000.
The Village of Clarendon Hills is located immediately west and adjacent to the
Village of Hinsdale and has a population of approximately 8,000.

Employees. As of March 31, 1996, Hinsdale Bank employed 24 full-time
equivalent employees. Hinsdale has no paid employees.

Services. Hinsdale Bank is an Illinois chartered, FDIC-insured
commercial bank which provides the full range of banking services. Hinsdale
Bank furnishes personal and commercial banking services, including demand, NOW,
money market, savings, and time deposit accounts; real estate, commercial, and
consumer loans; and safe deposit facilities. Hinsdale Bank anticipates adding
trust services during late 1996 or early 1997.

Hinsdale Bank was formed to provide the Hinsdale and Clarendon Hills
communities with a community bank alternative. As such, Hinsdale Bank is
focused on providing a highly personal, professional level of service to
commercial and retail customers residing in these areas. Emphasis is placed on
local ownership and management in attracting and maintaining deposit, loan and
trust customers.

Property. Hinsdale Bank currently has two physical banking locations.
Hinsdale Bank owns its main bank facility that is a two story brick building
located at 25 East First Street in downtown Hinsdale, Illinois. Hinsdale Bank
constructed a 1,000 square foot drive-in, walk-up banking facility at 130 West
Chestnut, approximately two blocks west of the main banking facility. Hinsdale
Bank maintains automated teller machines at both of its locations. Hinsdale
Bank has no offsite automated teller machines.

Hinsdale Bank has purchased a building in Clarendon Hills which has
approximately 6,000 square feet. Hinsdale Bank intends to occupy approximately
2,000 square feet as a full service banking facility and lease the remainder of
the space to unrelated parties.

ADDITIONAL INFORMATION

For a description of Hinsdale's and Hinsdale Bank's competition,
litigation, regulatory environment, interests in affiliates, transactions with
management and relationship with independent public accountants, see "MATTERS
OF GENERAL APPLICABILITY TO BANKS."

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BENEFICIAL OWNERSHIP OF COMMON STOCK

The following table sets forth information as of March 31, 1996, with
respect to beneficial ownership of shares of Hinsdale Common Stock held by
(i) each director of Hinsdale, (ii) each executive officer of Hinsdale, and
(iii) all directors and executive officers as a group.

SHARES SHARES
SUBJECT TO SUBJECT TO TOTAL PRO FORMA
COMMON VESTED HINSDALE % OF % OF
COMMON STOCK STOCK BENEFICIAL HINSDALE WINTRUST
SHARES(1) WARRANTS(2) OPTIONS OWNERSHIP TOTAL(3) TOTAL(3)(4)
----------- ------------- ----------- --------- ----------- -------------

DIRECTORS
- ---------
Howard D. Adams(5)** . . . . 18,397 3,686 -- 22,083 10.47% 7.56%
Peter Crist . . . . . . . . . 2,700 150 360 3,210 1.55% *
Diane Dean . . . . . . . . . 1,000 150 320 1,470 * *
Robert D. Harnach(6) . . . . 18,100 150 440 18,690 9.00% 6.31%
Dennis J. Jones ** . . . . . 3,170 527 3,700 7,397 3.50% *
James B. McCarthy . . . . . . 2,227 150 340 2,717 1.31% *
Mary Martha Mooney . . . . . 716 150 440 1,306 * *
Frank J. Murnane, Sr. . . . . 1,000 -- 240 1,240 * *
Richard B. Murphy ** . . . . 1,148 188 1,850 3,186 1.52% *
Joel Nelson . . . . . . . . . 530 150 380 1,060 * *
Hollis W. Rademacher . . . . 2,000 150 440 2,590 1.25% *
Ralph Schindler . . . . . . . 1,500 550 460 2,510 1.21% *
Katherine Sylvester . . . . . 450 150 380 980 * *
Edward J. Wehmer ** . . . . . 4,857 2,079 -- 6,936 3.32% 3.20%
Lorraine Wolfe . . . . . . . -- 150 180 330 * *
------ ----- ----- ----- -----
Total Directors . . . . . 57,795 8,380 9,530 75,705 36.19%

NON-DIRECTOR EXECUTIVE
OFFICERS
- ------------
David A. Dykstra . . . . . . 200 -- 300 500 * *
Randolph Hibben . . . . . . . 500 -- -- 500 * *
Robert F. Key . . . . . . . . 563 -- -- 563 * *
Lloyd M. Bowden . . . . . . . 625 -- -- 625 * *
George Mitchell . . . . . . . -- -- 200 200 * *
Richard J. Stefanski . . . . -- -- 200 200 * *
------ ----- ------ ------ -----
Total Directors and Executive
Officers as a group . . . . . 59,683 8,380 10,230 78,293 37.44%
====== ===== ====== ====== =====
Total Common Shares and
Share Equivalents . . . . 207,137 10,000 11,720 228,857
======= ====== ====== =======

* -- Less than 1%
** -- Denotes executive officer (in addition to director status)

(1) Includes shares held directly and, if applicable, indirectly through such
person's spouse, minor children, certain family trusts, IRA's or 401(k)
plans.

(2) After the Effective Date of the Reorganization, Hinsdale Common Stock
warrants will continue to represent the right to acquire shares of
Hinsdale, which will then be a mid-tier holding company and a subsidiary of
Wintrust.

(3) Beneficial ownership percentages are calculated in accordance with SEC Rule
13d-3 promulgated under the Securities Exchange Act of 1934.

(4) Assumes no exercise of outstanding options, rights or warrants other than
the anticipated exercise of a portion of the First Premium warrants to
acquire shares of Crabtree Common Stock as contemplated by the
Reorganization Agreement, resulting in 399,612 additional shares of
Wintrust Common Stock to be outstanding immediately following the Effective
Date of the Reorganization. Includes shares deemed beneficially owned by
such persons in any of the other Companies, giving effect to the applicable
Exchange Ratios and North Shore Stock Split. Also gives effect to the
cancellation of intercompany share ownership as provided in the
Reorganization Agreement.

(5) Does not include an aggregate of 612 shares owned directly by or indirectly
through certain family trusts for the benefit of Mr. Adams' two adult
children, nor an additional 788 shares subject to warrants beneficially
owned by his children.

(6) Includes (i) 1,600 shares held by an employee retirement plan of Milbank
Corporation of which Mr. Harnach is a trustee; (ii) 16,500 shares held by
Deerpath Investments LLP to which Milbank Corporation, of which Mr. Harnach
is an officer, director and principal shareholder, serves as investment
advisor and with respect to which shares Mr. Harnach has shared voting and
investment power; and (iii) 590 shares subject to options and warrants held
by Mr. Harnach.

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BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS

On March 31, 1996, Hinsdale had 207,137 shares of common stock
outstanding. As of such date, the following persons not listed under
"Management Ownership of Common Stock" are known by Hinsdale to be the owners
of more than 5% of its common stock.

NUMBER OF SHARES
NAME ADDRESS BENEFICIALLY OWNED PERCENT OF CLASS(1)
------------------------- ------------------------- ---------------------- ----------------------------

Milbank Corporation(2) 135 South LaSalle Street 20,990 10.10%
Chicago, IL 60603

(1) Beneficial ownership percentages are calculated in accordance with SEC Rule
13d-3 promulgated under the Securities Exchange Act of 1934.

(2) Includes (i) 1,500 shares held by Larry Wright, a director of Crabtree, and
an aggregate of 590 shares subject to currently exercisable options or
warrants held by Robert D. Harnach, a director of Lake Forest and Hinsdale,
each of whom are officers, directors and principal shareholders of Milbank
Corporation ("Milbank"); (ii) 1,600 shares held by an employee retirement
plan of Milbank of which Mr. Wright and Mr. Harnach are trustees with
shared voting and investment power; (iii) 16,500 shares held in Deerpath
Investments LLP, a limited partnership to which Milbank serves as
investment advisor and with respect to which Mr. Wright and Mr. Harnach
exercise shared voting and investment power; and (iv) 800 shares held in
certain family trusts of another officer of Milbank with respect to which
certain officers of Milbank act individually as co-trustees and exercise
shared voting power.

SELECTED FINANCIAL DATA
HINSDALE BANCORP, INC.

PERIOD
THREE MONTHS ENDED YEARS ENDED ENDED
MARCH 31, DECEMBER 31, DECEMBER 31,
----------------------------------------------------------------------------
1996 1995 1995 1994 1993(1)
---------------- ------------- ------------- ------------- -------------
(DOLLARS IN THOUSANDS)

Interest income . . . . . . . . . . . . $ 1,999 $ 1,102 $ 5,837 $ 2,305 $ 73
Interest expense . . . . . . . . . . . 1,295 744 3,770 1,732 66
-------- -------- -------- -------- --------
Net interest income . . . . . . . . . . 704 358 2,067 573 7
Provision for possible loan losses . . 104 60 299 180 0
Net interest income after provision
for possible loan losses . . . . . . 600 298 1,768 393 7
Noninterest income, excluding
security gains (losses) . . . . . . 230 93 572 237 43
Security gains (losses) . . . . . . . . 0 0 0 0 0
Noninterest expense . . . . . . . . . . 762 427 2,260 1,523 615
-------- -------- -------- -------- --------
Net income (loss) before income
taxes . . . . . . . . . . . . . . . 68 (36) 80 (893) (565)
Income taxes benefit . . . . . . . . . 0 0 340 0 0
-------- -------- -------- -------- --------
Net income (loss) . . . . . . . . . . . $ 68 $ (36) $ 420 $ (893) $ (565)
======== ======== ======= ======== ========
Net income (loss) per common
share . . . . . . . . . . . . . . . $ 0.31 $ (0.19) $ 2.04 $ (6.11) $ (12.55)
Cash dividends per common share . . . . $ 0 $ 0 $ 0 $ 0 $ 0

Total assets at end of period . . . . . $ 118,545 $ 72,466 $115,868 $ 66,519 $ 23,795
Total deposits at end of period . . . . 106,392 62,286 104,402 59,182 16,812
Secured-term debt at end of period . . 1,800 0 1,600 0 900
Preference stock at end of period . . . 0 0 0 0 0
Return on average total assets . . . . 0.23% (0.20%) 0.49% (1.88%) --(2)
Return on average common
shareholders' equity . . . . . . . . 2.80% (1.65%) 4.57% (15.15%) --(2)

- ---------------------------------
(1) Management has for this period presented selected financial data reflecting
reported results from the date of incorporation (September 25, 1992) to
December 31, 1993. The company was in a capital raising and organizational
phase and as described elsewhere herein was only operational from October
27, 1993 through December 31, 1993. Accordingly, management believes that
separate selected financial data from the date of incorporation (September
25, 1992) to December 31, 1992 and for January 1, 1993 to December 31, 1993
is not meaningful as the period presented herein approximates those
revenues and expenses that would have been recognized had 1994 been
presented on a stand-alone calendar year basis.

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(2) Return on average assets and average equity ratios are not meaningful as a
result of the nature of operations as discussed in Note 1 above.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

General. Hinsdale completed its second full year of operations in
1995. During that time period, Hinsdale has conducted no business other than
that directly related to Hinsdale Bank. Hinsdale's results of operations are
primarily dependent on Hinsdale Bank's net interest income, which is the
difference between interest income on interest-earning assets and interest
expense on interest-bearing liabilities. In addition, to a lesser extent,
Hinsdale Bank's operating results are affected by fees paid by borrowers, fees
earned on residential mortgage loans sold to the secondary market, customer
service charges and other income. Also, noninterest expenses such as employee
salaries and benefits, office occupancy, marketing, insurance costs and other
expenses affect the results of operations. Finally, income tax consequences
have an impact on the reported results of operations.

Operational results are also affected by general economic conditions
(particularly changes in interest rates). competition, government policies and
actions of regulatory agencies.

RESULTS OF OPERATIONS

Comparison of Results for the Period Ended March 31, 1996 to the Period Ended
March 31, 1995

Hinsdale recorded net income of $68,000 for the three-month period
ended March 31, 1996 compared to a net loss of $36,000 for the three-month
period ended March 31, 1995. The following discussion will highlight the
components of the net income and the change between the respective three month
periods.

Net interest income increased to $704,000 for the three months ended
March 31, 1996 from approximately $358,000 for the same period of 1995. The
near doubling of net interest income can generally be attributed to a 68%
increase in average earning assets for the first quarter of 1996 as compared to
the first quarter of 1995. The net interest margin was 2.64% for the three
months ended March 31, 1996 compared to 2.26% for the three months ended March
31, 1995. Accordingly, the increase in average earning assets combined with
the modest increase of the net interest margin appropriately explains the
increase in the net interest income.

The provision for possible loan losses increased to $104,000 for the
three months ended March 31, 1996 compared to $60,000 for the prior year three
month period. Hinsdale Bank has provided a higher amount to the allowance for
possible loan losses during the first quarter of 1996 because of the growth in
the loan portfolio. Loans outstanding at March 31, 1996 were $67,505,000
compared to $28,538,000 at March 31, 1995. Management considers it prudent to
continue to build a reserve for unanticipated credit problems that may occur
with the existing portfolio despite having no loans on nonaccrual status or
significantly past due at March 31, 1996. The allowance for loan losses as a
percentage of total loans outstanding stood at 0.86% at March 31, 1996 compared
to 0.84% as of March 31, 1995. Due to the high quality of the outstanding loan
portfolio, management considers the amount of the provision and the level of
the allowance for loan losses to be adequate for the period ended and as of
March 31, 1996.

Other noninterest income totaled $230,000 for the three months ended
March 31, 1996 compared to approximately $93,000 for the three months ended
March 31, 1995. The increase in the 1996 and 1995 three-month periods is a
primarily a result of (1) approximately $54,000 of increased revenue related to
fees on fixed rate residential mortgage loans which were sold to the secondary
market; and (2) approximately $49,000 from the gain on the sale of a parcel of
property.

Other noninterest expenses were $762,000 and $427,000 for the
three-month periods ended March 31, 1996 and March 31, 1995, respectively. The
major components of the other noninterest expenses for the respective three
month periods are as follows (in thousands):

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THREE MONTHS ENDED MARCH 31,
--------------------------------------
1996 1995
----------------- ------------------

Salaries and employee benefits . . $414 $206
Occupancy expense . . . . . . . . . 49 27
Other noninterest expenses . . . . 299 194
---- ----

Total other noninterest expenses . $762 $427
==== ====

Salaries and Employee Benefits. The increase in salaries and employee
benefits to $414,000 for the three months ended March 31, 1996 from $206,000
for the same period in the prior year is a result of a variety of causes of
which the most significant were: (1) Hinsdale Bank started a lending department
to originate indirect automobile loans for its own portfolio and to sell to
other parties. This department had 3 full time equivalent employees during
1996 but had no such employees in the first quarter of 1995; (2) Hinsdale Bank
opened a new drive-in/walk-up facility in late 1995 and, therefore, the first
quarter of 1995 had no salaries or benefits associated with that location
whereas 1996 had expense for approximately 5 full-time equivalent employees;
(3) the growth of Hinsdale Bank from $72 million in assets at March 31, 1995 to
approximately $119 million at March 31, 1996 required the addition of one
employee in the operations, new accounts and lending areas of Hinsdale Bank,
respectively; and (4) normal salary and wage increases as January 1, 1996.

Occupancy Expense. Occupancy expense totaled approximately $49,000
for the first three months of 1996 compared to $27,000 for the first three
months of 1995. The increase in this expense category is a result of the
opening of the drive-in/walk-up banking facility in the fourth quarter of 1995.
As such, 1995's first quarter had no occupancy expenses associated with this
new facility, whereas the first three months of 1996 included additional
depreciation, maintenance, property taxes, utilities and other miscellaneous
expenses.

Other Noninterest Expenses. Other noninterest expenses were $299,000
for the first quarter of 1996 compared to $194,000 for the same period of the
prior year. The increase is primarily related to a 71% increase in the level
of deposit accounts from March 31, 1995 to March 31, 1996 and the inclusion of
the expenses related to the new drive-in/walk-up facility in 1996. The major
categories that exhibited large increases were (1) data processing increased
$21,000 as a result of additional loan and deposit accounts that required
processing; (2) depreciation expense increased approximately $17,000 primarily
due to the depreciation of the furnishings and equipment at the new facility;
(3) postage expense and stationery/supplies expense increased approximately
$10,000 and $9,000, respectively, due to the additional account volume between
years; and (4) Hinsdale Bank's indirect auto lending department was operational
in 1996 but was not operational during the first quarter of 1995. Accordingly,
various expenses related to the execution of that department acted to increase
this expense category. Offsetting these additional expenses was a decline in
the level of premiums assessed by the Federal Deposit Insurance Corporation for
deposit insurance of approximately $24,000.

Comparison of Results for the Years Ended December 31, 1995 and December 31,
1994

General. Hinsdale had net income of $420,000 for the year ended
December 31, 1995, compared with a net loss of $893,000 for the year ended
December 31, 1994. The increase of $1,313,000 in net income was due to an
increase in net interest income of $1,494,000, an increase in other noninterest
income of $335,000, the realization of $340,000 in income tax benefits, offset
by an increase in the provision for possible loan losses of $119,000, and other
noninterest expenses of $737,000. These and other details will be discussed in
greater detail in the following sections.

Net Interest Income. The major source of earnings for Hinsdale is net
interest income. In fact, net interest income was approximately 78% and 71% of
the net revenues during 1995 and 1994, respectively. Net interest income is
defined as the difference between interest income and fees on earning assets
and interest expense on deposits and borrowings.

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Interest Income and Interest Expense. Interest income increased from
$2,305,000 in 1994 to $5,837,000 in 1995, whereas, interest expense increased
from $1,732,000 in 1994 to $3,770,000 in 1995. The significant increases in
each of these categories were due primarily to the increases in earning assets
and interest-bearing liabilities of 80% and 83%, respectively. Increases in
the general rate environment also contributed to the higher level of interest
income and interest expense. An analysis of the components and characteristics
of interest income and interest expense is presented in the table below,
including average balances and average rates/yields for Hinsdale Bank's earning
assets and interest-bearing liabilities for the years ended December 31, 1995
and 1994. Data for the period ended 1993 is not presented because Hinsdale
Bank was only in operation for less than three months and net interest income
amounted to only $7,000.

1995 1994
--------------------------------------------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE
BALANCE INTEREST YIELD/RATE BALANCE INTEREST YIELD/RATE
------- -------- ---------- ------- -------- ----------
(DOLLARS IN THOUSANDS)

ASSETS
Interest bearing deposits with banks . . $ 14,021 $ 870 6.20% $13,184 $ 566 4.29%
Federal funds sold . . . . . . . . . . . 9,041 528 5.84% 6,953 288 4.14%
Taxable debt securities . . . . . . . . . 13,803 738 5.35% 11,537 589 5.11%
Equity securities . . . . . . . . . . . . 287 0 0.00% 0 0 0.00%
Loans, net of unearned discount . . . . . 40,440 3,701 9.15% 11,374 862 7.58%
-------- ------ ---- ------- ------ ----
Total earning assets . . . . . . . . 77,592 5,837 7.52% 43,048 2,305 5.35%
-------- ------ ---- ------- ------ ----

Cash and due from banks-noninterest
bearing . . . . . . . . . . . . . . . 2,072 679
Allowance for possible loan losses . . . (293) (85)
Premises and equipment, net . . . . . . . 5,037 2,842
Other assets . . . . . . . . . . . . . . 1,215 909
-------- -------
Total assets . . . . . . . . . . . . $ 85,623 $47,393
======== =======

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits-interest bearing
NOW accounts . . . . . . . . . . . . . $ 2,093 $ 51 2.44% $ 855 $ 22 2.57%
Savings and money market deposits . . 36,347 1,781 4.90% 25,461 1,130 4.44%
Time deposits . . . . . . . . . . . . 30,280 1,862 6.15% 11,376 542 4.76%
-------- ------ ---- ------- ------ ----
Total interest-bearing deposits . . 68,720 3,694 5.38% 37,692 1,694 4.49%
-------- ------ ---- ------- ------ ----
Short-term borrowings . . . . . . . . . . 0 0 0.00% 0 0 0.00%
Term-debt . . . . . . . . . . . . . . . . 995 76 7.64% 450 38 8.44%
-------- ------ ---- ------- ------ ----
Total interest-bearing liabilities . 69,715 3,770 5.41% 38,142 1,732 4.54%
-------- ------ ---- ------- ------ ----

Noninterest bearing deposits . . . . . . 6,440 3,215
Other liabilities . . . . . . . . . . . . 276 143
Shareholders' equity . . . . . . . . . . 9,192 5,893
-------- -------
Total liabilities and shareholders'
equity . . . . . . . . . . . . . . . $ 85,623 $47,393
======== =======

Interest income/average earning assets . 7.52% 5.35%
Interest expense/average interest-bearing
liabilities . . . . . . . . . . . . . 5.41% 4.54%
---- ----
Net interest spread . . . . . . . . . . . $2,067 2.11% $ 573 0.81%
====== ==== ====== ====
Net interest margin(1) . . . . . . . . . 2.66% 1.33%
==== ====

(1) Net interest margin represents net interest income as a percent of the
average earning assets for the period.

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Changes in Interest Income and Expense. The following table shows the
dollar amount of changes in interest income and expense by major categories of
assets and liabilities attributable to changes in volume or rate or both, for
the period of 1995 as compared to 1994 (in thousands). Because Hinsdale did
not have a complete fiscal year during 1993, the presentation of the 1994
comparison to 1993 is not meaningful. As such, no such disclosure for the
1994/1993 changes in interest income and expense is applicable.

1995 COMPARED TO 1994
--------------------------------------------------
CHANGE DUE CHANGE DUE TOTAL
TO VOLUME TO RATE CHANGE
--------------- -------------- ---------------

Interest-earning deposits with banks . $ 38 $266 $ 304
Federal funds sold . . . . . . . . . . 101 139 240
Taxable securities . . . . . . . . . . 120 29 149
Loans, net of discount . . . . . . . . 2,626 213 2,839
------ ---- ------
Total interest income . . . . . . 2,885 647 3,532
------ ---- ------

NOW accounts . . . . . . . . . . . . . 30 (1) 29
Savings and money market deposits . . . 524 127 651
Time deposits . . . . . . . . . . . . . 1,123 197 1,320
Short-term borrowings . . . . . . . . . -- -- --
Term debt . . . . . . . . . . . . . . . 41 (3) 38
------ ---- ------
Total interest expense . . . . . . 1,718 320 2,038
------ ---- ------

Net interest income . . . . . . . $1,167 $327 $1,494
====== ==== ======

Volume variances are computed using the change in volume multiplied by
the previous year's rate. Rate variances are computed using the changes in
rate multiplied by the previous year's volume. The change in interest due to
both rate and volume has been allocated between the factors in proportion to
the relationship of the absolute dollar amounts of the change in each.
Hinsdale did not own any federally tax-advantaged securities during the periods
presented.

Provision for Possible Loan Losses. The provision for possible loan
losses increased from $180,000 in 1994 to $299,000 in 1995. Management
continued to provide for additions to the allowance for possible loan losses as
the loan portfolio increased approximately $35,758,000 between the year-end
periods. At December 31, 1995, the allowance for possible loan losses stood at
0.8% of loans outstanding which management feels is adequate to cover potential
losses in the portfolio. There can be no assurance that future losses will not
exceed the amounts provided for thereby affecting future results of operations.
Future additions to the allowance for possible loan losses are dependent upon
the economy, changes in real estate values, interest rates, the view of
regulatory agencies toward adequate reserve levels, and past due and
non-performing loan levels.

Other Noninterest Income. Noninterest income increased to $572,000 in
1995 from $237,000 in the previous year, or an increase of $335,000. Fees on
loans sold increased approximately $181,000 in 1995 as compared to the prior
year. A favorable interest rate environment and an experienced lending officer
contributed to this increase. Fees on loans sold relate to income received by
Hinsdale Bank for its services of originating and selling residential real
estate loans into the secondary market. Service charges on deposit accounts
increased from $29,700 in 1994 to $73,200 in 1995, or approximately $43,500,
primarily as a result of the rapid growth in the retail deposit base. It
should be noted that approximately 75% of the service charges on deposit
accounts relates to customary fees on accounts in overdraft positions and for
return items on an account. The level of service charges received on deposit
accounts is substantially below peer group levels as management believes in the
philosophy of providing high quality service without encumbering that service
with numerous activity charges. That philosophy has contributed to the strong
growth in retail deposits. The remaining increase in noninterest income is a
result of (1) an additional $69,000 in rental income in 1995 as compared to the
prior year, and (2) Hinsdale

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Bank began servicing indirect automobile loan portfolios for affiliated banks
in 1995 which resulted in approximately $35,000 of servicing fee income. The
servicing rate charged the affiliated banks is at a market rate.

DOLLAR PERCENTAGE
1995 1994 CHANGE CHANGE
---------- ---------- --------- --------------

Salaries and employee benefits . . . . $1,166 $ 754 $ 412 54.6%
Occupancy expenses . . . . . . . . . . 124 139 (15) 10.8%
Advertising and marketing . . . . . . . 116 71 45 63.4%
Data processing . . . . . . . . . . . . 151 88 63 71.6%
Depreciation-furniture and equipment . 94 58 36 62.1%
Insurance . . . . . . . . . . . . . . . 115 94 21 22.3%
Other noninterest expenses . . . . . . 494 319 175 54.9%
------ ------ ----- ----
Total noninterest expenses . $2,260 $1,523 $ 737 48.4%
====== ====== ===== ====

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. Salaries and employee benefits
expense increased to $1,166,000 for the year ended December 31, 1995 from
$754,000 for the prior year. The growth in loans and deposits of 160% and 76%,
respectively, required additional employees to appropriately service the
accounts. The level of full-time equivalent employees increased to 20 at
year-end 1995 from 14 at year-end 1994. As of December 31, 1995, this staffing
level translates into a ratio of $5.79 million of assets per full-time
equivalent employee as compared to a ratio of $2.77 million of assets per
full-time equivalent employee of its peer group. This places Hinsdale Bank in
the 92nd percentile of its peer group. A portion of the loan growth mentioned
above occurred because during the second quarter of 1995, Hinsdale Bank
initiated a lending department to originate indirect automobile loans for its
own portfolio and for sale to other financial institutions. The employees in
this department are included in the 20 full-time equivalent employees
referenced above. Also, normal annual salary and wage increases contributed to
the increase.

Occupancy Expenses. Occupancy expenses include those expenses which
relate directly to the operation of the buildings, improvements and property.
The major components of occupancy expense in 1995 were $59,000 for depreciation
expense on the buildings and improvements and $30,000 for repairs and
maintenance expense. The remaining $35,000 of expense in 1995 was for such
items as utilities, real estate taxes, and other sundry expense related to the
occupancy of the buildings and grounds. The occupancy expense amount in 1995
was approximately $15,000 less than the prior year due to efficiencies
implemented during Hinsdale Bank's second full year of operations.

Advertising and Marketing. Marketing and advertising expenditures
amounted to $116,000 during 1995 compared to $71,000 in 1994. The increase in
this category can be primarily attributed to Hinsdale Bank's effort to attract
new deposit accounts through the marketing of its competitive money market and
certificate of deposit accounts (see discussion of these accounts in the
"Financial Condition" section). Additionally, Hinsdale Bank more aggressively
marketed its home equity loan product during 1995. The results of these
marketing campaigns were positive as balances increased substantially over
their 1994 levels. Hinsdale Bank continually attempts to develop community
oriented deposit and loan products that meet the needs of its delineated market
area and considers the marketing expenses instrumental in achieving the growth
in the deposit base. Management anticipates that relatively similar levels of
marketing expenses will be incurred in 1996 as Hinsdale Bank continues to
pursue its objective of increasing its base of customers.

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Data Processing. Data processing expenses increased by approximately
$63,000 or 71.6% for the year ended December 31, 1995 compared to the results
for the year ended December 31, 1994. Data processing expenses are highly
dependent on the number of accounts processed by Hinsdale Bank. As such, the
increase during 1995 in deposit and loan balances of approximately 76% and
160%, respectively, was the primary reason for the increase in this expense
category.

Insurance. For the year ended December 31, 1995 insurance expense
increased by approximately $21,000, or 22.3% from the prior year level. Many
of Hinsdale Bank's insurance policies have premium rates that are based partly
upon the number of employees and the total deposit and asset levels of Hinsdale
Bank. Due to the increase in these areas during 1995, the cost of insurance
for Hinsdale Bank increased.

Other Noninterest Expenses. Other noninterest expenses increased to
$494,000 for the year ended December 31, 1995 from $319,000 for the year ended
December 31, 1994. This category of expenses represents stationery and
supplies expense, loan origination expenses, postage expense, amortization of
organizational costs, audits and examinations expense, and other sundry
expenses. The 54.9% increase in this category is a general increase of all of
the above categories primarily due to the higher volume of accounts
outstanding. For example, postage expense increased approximately 69% which is
comparable to the increase in deposit balances. Also, during 1995, Hinsdale
Bank offered a home equity loan product that had no fees or costs borne by the
customer; thus, Hinsdale Bank incurred the costs of appraisals, title searches
and other miscellaneous costs of originating home equity loans. Controlling
overhead expenses is a basic philosophy of management and is closely evaluated.
Management is committed to continually evaluating its operations to determine
whether additional expense savings are possible without impairing the goal of
providing superior customer service.

Despite the increases in the various noninterest expense categories
during 1995, Hinsdale's ratio of noninterest expenses to total average assets
declined to 2.64% of average assets in 1995 from 3.21% of average assets in
1994. Hinsdale Bank's peer group has a ratio of noninterest expenses to total
average assets of approximately 3.17%. Thus, Hinsdale Bank has controlled its
noninterest expenses in a fashion which is superior to other banks in its peer
group.

Income Taxes. Hinsdale had no Federal or state income tax expense for
1995 or 1994. In 1995, an income tax benefit of $340,000 was recorded as
management determined that the realization of certain deferred tax assets not
previously valued was more likely than not to occur. In 1994, management had
established a valuation allowance against its net deferred tax assets with the
result being that no Federal or state income tax expense or benefit was
realized in the financial statements. However, in 1995, management determined
that its earnings history and projected future earnings were sufficient to make
a judgment that the realization of a portion of the net deferred tax asset was
more likely than not. As such, an income tax benefit was recorded to record
the portion of the net deferred tax asset that was more likely than not to be
recognized.

Comparison of Results for the Year Ended December 31, 1994 and Period Ended
December 31, 1993

General. Hinsdale had a net loss of $893,000 for the year ended
December 31, 1994, compared with a net loss of $565,000 for the period ended
December 31, 1993. It is typical for a new bank to incur operating losses
during its first few years of operation due to the overhead infrastructure
required to house and staff a banking facility. As Hinsdale Bank is able to
grow its deposit base and employ those funds into interest earning assets, the
net interest income earned should eventually generate enough income to support
the overhead expenses and provide a profit. Accordingly, the increase in the
net loss was anticipated by management due to the start-up nature of the
entity.

The details of the components of the net loss will be discussed in
greater detail in the following sections.

Interest Income and Interest Expense. Interest income increased from
$73,000 in the period ended 1993 to $2,305,000 in 1994. Similarly, interest
expense increased from $66,000 in the period ended 1993 to $1,732,000 in 1994.
The significant rise in interest income and interest expense from 1993 to 1994
is attributable to the fact

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that Hinsdale Bank only began banking operations in October of 1993 and,
therefore, the level of interest-bearing liabilities and interest-earning
assets were just beginning to accumulate in the last few months of 1993.
During 1994, the volume of deposits and loans increased as customer
relationships were established.

A complete analysis of the components and characteristics of interest
income and interest expense is shown in the average balance/rate table
presented previously.

Provision for Possible Loan Losses. The provision for possible loan
losses totaled $180,000 in 1994; however, no provision for possible loan losses
was charged to earnings during the period ended in 1993. Management provided
for the addition to the allowance for possible loan losses as the loan
portfolio increased approximately $22 million between the year-end periods. At
December 31, 1994, the allowance for possible loan losses stood at 0.81% of
loans outstanding which management considered adequate to cover potential
losses in the portfolio.

Other Noninterest Income. Noninterest income increased to $237,000 in
1994 from $43,000 in the period ended 1993, or approximately $194,000. The
primary reason for the decline was a result of approximately $124,000 of income
from fees on loans sold in 1994 whereas the period ended 1993 had no such fees.
Fees on loans sold relate to income received by Hinsdale Bank for its services
of originating and selling residential real estate loans into the secondary
market. The income derived from these sales is highly dependent on the volume
of real estate sales transactions and refinancing activity. As such, the
business is sensitive to the interest rate environment and other economic
conditions. The remaining $90,000 increase in noninterest income was a result
of a slight increase in service charges on deposit accounts and other income.

YEAR PERIOD
ENDED ENDED
DECEMBER 31, DECEMBER 31, DOLLAR
1994 1993 CHANGE
--------------- --------------- ------------

Salaries and employee benefits . . . . $ 754 $ 310 $ 444
Occupancy expenses . . . . . . . . . . 139 33 106
Advertising and marketing . . . . . . . 71 44 27
Data processing . . . . . . . . . . . . 88 19 69
Depreciation-furniture and equipment . 58 8 50
Insurance . . . . . . . . . . . . . . . 94 6 88
Other noninterest expenses . . . . . . 319 195 124
----- ----- -----
Total noninterest expenses . $1,523 $ 615 $ 908

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. Hinsdale Bank began to accumulate
staff in June of 1993 as the company began the process of organizing the bank
holding company and chartering the Hinsdale Bank. A full staffing complement
was achieved by October of 1993 when Hinsdale Bank received regulatory approval
and began to operate. From October 1993 and through December 31, 1993,
Hinsdale Bank had approximately xx full-time equivalent employees to perform
all the operations, customer service, lending and administration of the main
banking location and its drive-up banking facility. Approximately $177,000 of
the total salaries and employee benefits expense in the period ended 1993 was
incurred during the start-up phase with the remaining $133,000 of

120
this expense category incurred subsequent to the opening of Hinsdale Bank. The
level of salaries increased in 1994 to $754,000 primarily due to a full year of
operations in 1994.

Occupancy Expenses, Advertising and Marketing, Data Processing,
Insurance, and All Other Noninterest Expenses. Each of these expense
categories increased significantly due primarily to the 12 months of operations
in 1994 compared to only two full months of operations in 1993. The expenses
incurred in these categories in both years were normal operational expenses for
a community bank. No significant or unusual individual expenditures were
incurred which warrant any further special discussion.

Income Taxes. Hinsdale recorded no income tax expense or benefit for
the year ended December 31, 1994 and the period ended December 31, 1993 due to
the net operating losses generated during the initial years of operation.

FINANCIAL CONDITION

The dynamics of a community bank's balance sheet is generally
dependent upon the ability of management to attract additional deposit accounts
to fund the growth of the institution. This is the current situation at
Hinsdale Bank as it has expanded the number of banking facilities in its
delineated market area and is persistent in its attempt to establish itself as
Hinsdale Bank that the communities' residents and businesses select as their
preferred bank. Accordingly, the discussion of the financial condition of
Hinsdale will focus first on the sources of funds received through the
liability side of the balance sheet which is predominantly deposit growth.
After it is understood how Hinsdale was funded during the periods under
discussion, the latter section of this "Financial Condition" discussion will
focus on the asset categories where Hinsdale invested the funds.

Deposits. Total deposits balances increased to $106,392,000 at March
31, 1996 compared to $104,402,000 at December 31, 1995 and $59,182,000 at the
end of 1994. This follows a $42,370,000 increase in deposits in 1994 from the
$16,812,000 deposit level at the end of 1993. The following table presents the
balances of deposits by category and those categories' relative percentage of
the total deposits as of March 31, 1996 and as of year-end during the past
three years.

MARCH 31, DECEMBER 31,
------------------------------------------------------------------
1996 1995 1994 1993
-------------------- ------------------- -------------------- ----------------------
PERCENT PERCENT PERCENT PERCENT
BALANCE OF TOTAL BALANCE OF TOTAL BALANCE OF TOTAL BALANCE OF TOTAL
--------- -------- -------- -------- -------- --------- ---------- ---------

Demand . . . . $ 10,471 9.8% $ 11,640 11.2% $ 5,792 9.8% $ 1,387 8.3%
Savings . . . . 7,010 6.6% 6,765 6.5% 7,830 13.2% 4,732 28.1%
NOW . . . . . . 3,470 3.3% 3,029 2.9% 1,709 2.9% 103 0.6%
Money market . 35,383 33.3% 34,071 32.6% 26,190 44.3% 7,979 47.5%
Certificates of
Deposit . . 50,058 47.0% 48,897 46.8% 17,661 29.8% 2,611 15.5%
-------- ----- -------- ----- ------- ----- ------- -----
Total Deposits $106,392 100.0% $104,402 100.0% $59,182 100.0% $16,812 100.0%
======== ===== ======== ===== ======= ===== ======= =====

Since the inception of Hinsdale Bank in October of 1993, management
has aggressively marketed money market and certificate of deposit products
which provide a yield slightly higher than those of its primary competitors.
Hinsdale Bank's primary money market product originally paid a rate at or
slightly above the yield on the 91-day Treasury Bill. This market yield, tied
with the flexibility of the money market account helped to generate close to
$30 million in deposits for Hinsdale Bank. This growth has slowed somewhat due
to the management's decision in mid-1995 to remove the tie to the 91-day
Treasury Bill. However, this account still pays a rate higher than the money
market accounts of Hinsdale Bank's primary competitors.

Similar to the money market account, Hinsdale Bank has offered
certificates of deposits which have paid a rate equal to or slightly higher
than the rate paid by its primary competitors. This pricing, coupled with
aggressive marketing of unique one-time certificate of deposit product
offerings have generated substantial deposits

100
121

for Hinsdale Bank. This type of marketing and pricing is a strategy Hinsdale
Bank purposefully employs in order to generate customer loyalty and serve the
needs of the community in a fashion unlike its competitors.

One of the biggest challenges Hinsdale Bank has faced since opening,
has been attracting demand deposit and N.O.W. accounts. At the time Hinsdale
Bank opened, customer accessibility was limited due to a lack of a drive-up and
customer parking lot. This situation was remedied, in part, during October of
1995 when Hinsdale Bank opened its drive-up facility. Since this time,
combined DDA and NOW balances have grown by a combined $4.1 million.

Reference is made to the average balance/rate table for data regarding
average daily deposits and rates paid thereon for the years ended December 31,
1995 and 1994. Hinsdale Bank has no foreign deposits.

The aggregate amounts of time deposits, in denominations of $100,000
or more, by maturity, as of December 31, 1995 are shown below (in thousands):

Three months or less . . . . . . . . . . . . . . . $ 9,035
Over three through six months . . . . . . . . . . . 6,330
Over six through twelve months . . . . . . . . . . 3,588
Over twelve months . . . . . . . . . . . . . . . . 7,651
-------
Total . . . . . . . . . . . . . . . . . . . . . $26,604
=======

Accrued Interest Payable and Other Liabilities. The collective
balance of these two financial statement categories as of December 31, 1995 and
1994 were $222,000 and $123,000, respectively. The increase can be primarily
attributed to a higher amount of accrued interest payable on deposit accounts
due to the significant growth in the level of deposits. No other significant
changes were present in this financial statement category.

Term Debt. In December, 1995, Hinsdale entered into a revolving loan
agreement with an unaffiliated bank allowing borrowings up to $3,000,000. The
loan is secured by 100% of the common stock of Hinsdale Bank. Borrowings under
the agreement bear interest at the prime rate or at the rate of LIBOR plus 1.5%
and will be due quarterly. The final maturity date for the agreement is
December 31, 1997. The debt was entered into as a means to contribute
additional capital to Hinsdale Bank to support its continued growth.

Total Assets and Earning Assets. Total assets and earning assets were
$115,868,000 and $105,516,000, respectively, at December 31, 1995 compared to
$66,519,000 and $61,648,000, respectively, at December 31, 1994. The increase
in total assets and earning assets during the year was a result of significant
growth in all types of deposit categories. The level of earning assets as a
percentage of total assets fell slightly to 91.1% at year-end 1995 from 92.7%
at the end of 1994. The decline in the level of earning assets relative to the
total asset base was a result of the additional building and premise
expenditures made to establish a drive-through banking facility in Hinsdale.
However, the composition of earning assets shifted as Hinsdale Bank began to
invest deposit funds into loans from shorter-term money market investments.
Loans comprised 55.0% of total earning assets at December 31, 1995 compared to
36.2% at December 31, 1994. These changes in the mix of earning assets will be
discussed further below.

Loans. The following table shows Hinsdale's loans classified by type
at March 31, 1996 and as of December 31, 1995, 1994 and 1993 (in thousands):

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MARCH 31, DECEMBER 31,
--------------------------------------------
1996 1995 1994 1993
------------ ------------ ------------ --------------

Residential real estate . . . $ 9,942 $ 8,838 $ 6,463 $ --
Commercial . . . . . . . . . 25,614 21,165 9,503 105
Home equity . . . . . . . . . 11,553 11,481 5,614 198
Consumer . . . . . . . . . . 22,101 18,082 747 35
------- ------- ------- -----
Total gross loans . . . . 69,210 59,566 22,327 338
Less: unearned discount . . 1,705 1,481 -- --
------- ------- ------- ------
Net loans . . . . . . . . $67,505 $58,085 $22,327 $ 338
======= ======= ======= =====

Hinsdale Bank's loan portfolio has grown substantially from date of
opening to over $58 million as of December 31, 1995, increasing from $22.3
million at the end of 1994. As of December 31, 1995, the portfolio can be
broken down into three distinct categories. The first category, which consists
of approximately $20 million, is made up of loans secured by single family
homes. These loans are either nonconforming first mortgage residential real
estate loans which Hinsdale Bank is unable to sell to the secondary market or
home equity lines of credit. These loans, which are all variable rate, are
secured by homes in the suburban Chicagoland area.

The second category is commercial loans which total approximately $21
million. These loans consist of over $10 million in commercial real estate
secured transactions which have terms of less than 10 years and are generally
variable rate. The commercial real estate loans are generally not secured by
any significant amount of speculative real estate transactions; rather, the
loans are underwritten based upon stable verifiable cash flows generated by the
property and also supported by the properties' collateral value. The balance
of the category consists of loans to small, locally based companies, which
typically have terms of one year or less. In general, these loans are secured
by a combination of business assets, real estate and personal guaranties.

The last category is consumer loans which consists of over $16 million
in indirect automobile loans and approximately $2 million in other consumer
loans to individuals. Hinsdale Bank has developed a niche business which
provides for select automobile dealers to send applications directly to
Hinsdale Bank for approval. The loans are secured by a first lien on the
purchased automobile. The loans typically will have a term from 36 to 60
months and have a fixed rate.

Hinsdale has no loans to businesses or governments of foreign
countries.

Money Market Investments and Investment Securities. Hinsdale Bank's
objective in managing its securities portfolio is to balance Hinsdale Bank's
liquidity risk, interest rate risk and credit quality such that the earnings of
Hinsdale Bank are maximized. As noted in the "Loans" section above, the
predominant portion of the funds received from new deposit accounts was
invested in the various loan categories during 1995. Management has maintained
the funds that were not invested in loans in short-term investment securities
and money market investments as follows (in thousands):

MARCH 31, DECEMBER 31,
---------------------------------------
1996 1995 1994
------------ ------------------ ------------------

Federal funds sold . . . . . . . . . . . . . $10,221 $16,022 $10,494
Interest bearing deposits with Banks . . . . -- 16,000 11,500
Investment securities . . . . . . . . . . . . 32,440 15,409 17,327
------- ------- -------
Total money market investments
and investment securities . . . . . . . . $42,661 $47,431 $39,321
======= ======= =======

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Investment Securities. The carrying value of securities held by
Hinsdale at December 31, 1995, 1994 and 1993 are as follows (in thousands):

DECEMBER 31,
--------------------------------------------

1995 1994 1993
-------- -------- --------

AVAILABLE-FOR-SALE
U.S. Treasury Obligations . . . $ 5,529 $ -- $ --
U.S. agency obligations . . . . 3,728 -- --
Other securities . . . . . . . 5,105 -- --
Federal Reserve Bank stock . . 247 -- --
Equity securities . . . . . . . 800 -- --
--------- -------- -------
Total available-for-sale . 15,409 -- --
--------- -------- -------

HELD-TO-MATURITY
U.S. Treasury obligations . . . -- 587 --
U.S. agency obligations . . . . -- 13,555 885
Other securities . . . . . . . -- 3,036 2,811
Federal Reserve Bank stock . . -- 149 129
--------- -------- -------
Total held-to-maturity . . -- 17,327 3,825
--------- -------- -------
Total securities . . . . . $ 15,409 $17,327 3,825

Maturities of securities as of December 31, 1995 are as follows (in
thousands):

WITHIN FROM 1 FROM 5 TO AFTER EQUITY
1 YEAR TO 5 YEARS 10 YEARS 10 YEARS SECURITIES TOTAL
----------- ------------ ------------- ------------ ------------ ------------

U.S. Treasury obligations . . . . $5,529 $ -- $ -- $ -- $ -- $5,529
U.S. agency obligations . . . . . 3,728 -- -- -- -- 3,728
Other securities . . . . . . . . 498 4,607 5,105
Federal Reserve Bank stock . . . -- -- -- -- 247 247
Equity securities . . . . . . . . -- -- -- --
-- -- -- -- 800 800
------ ------ ----- ----- ------ --------
Total . . . . . . . . . . . . . $9,755 $4,607 $ -- $ -- $1,047 $ 15,409
====== ====== ===== ===== ====== ========

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The weighted average yield for each range of maturities of securities is shown
below as of December 31, 1994.

WITHIN FROM 1 FROM 5 TO AFTER EQUITY
1 YEAR TO 5 YEARS 10 YEARS 10 YEARS SECURITIES TOTAL
----------- ------------ ------------------------- ------------ ------------

U.S. Treasury obligations . . . . 5.72% --% --% --% --% 5.72%
U.S. agency obligations . . . . . 5.74% --% --% --% --% 5.74%
Other securities . . . . . . . . 5.38% 6.17% --% --% --% 6.09%
Federal Reserve Bank stock . . . --% --% --% --% 6.00% 6.00%
Equity securities . . . . . . . . N/A N/A --% --% N/A N/A

Yields on equity securities are not considered meaningful for purposes of this
analysis.

Hinsdale did not own any federally tax-advantaged securities during
the periods presented.

There were no securities of any single issuer which had book value in
excess of ten percent of shareholders' equity at December 31, 1995.

Shareholders' Equity. Hinsdale was incorporated on September 25, 1992
and initially capitalized through the issuance of 20 no par common shares at
$50 each; 10,000 no par preferred convertible shares at $50 each; and 5,000 no
par common stock Series A warrants at $5 each. Each Series A warrant entitles
the holder to acquire one share of common stock at a purchase price of $50.

Subsequent to the initial capitalization, Hinsdale raised an
additional $6,042,827 through the private placement issuance of 120,834 no par
common shares. During the initial period of operations, Hinsdale allocated
$1,000,000 of the initial surplus to undivided profits to cover initial
operating expenditures.

The Hinsdale Bancorp, Inc. 1993 Recapitalization Plan, as approved by
the shareholders, provided for the redemption of the 10,000 convertible,
preferred shares of Hinsdale stock outstanding in a like kind exchange for
common stock and the issuance of additional common stock warrants. The
preferred shares were held primarily by officers and employees of Hinsdale who
contributed significantly to the organization, capitalization and opening of
Hinsdale Bank.

2.15 shares of common stock were exchanged for each preferred share
outstanding. The 10,000 preferred shares outstanding were exchanged for 21,500
common shares of Hinsdale common stock. The preferred stock received was
retired by Hinsdale.

Hinsdale also authorized and issued 5,000 common stock Series B
warrants. Each Series B warrant entitles the holder to acquire one share of
Hinsdale's common stock at a price of $31.50 per share. The warrants have a
ten year life and were issued to the holders of the preferred stock.

Because of growth, during 1994, Hinsdale authorized the issuance of an
additional shares of common stock at $65 per share. This issuance resulted in
63,683 shares sold, resulting in proceeds of approximately $4,100,000.

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The following table reflects various measures of capital at March 31,
1996 and year-end 1995 and 1994 for Hinsdale:

DECEMBER 31,
MARCH 31, --------------------------------------
1996 1995 1994
------------ ------------------ -----------------

Ending tier I risk-based capital ratio. . 12.1% 12.8% 17.6%
Ending total risk-based capital ratio . . 12.8% 13.5% 18.0%
Ending leverage ratio . . . . . . . . . . 8.2% 8.3% 10.7%
Dividend payout ratio . . . . . . . . . . 0.0% 0.0% 0.0%

The leverage ratios, tier 1 risk-based capital ratios and total
capital ratios all exceed the "well capitalized" levels established by
regulatory agencies of 5%, 6% and 10%, respectively.

Management is not aware of any known trends, events, regulatory
recommendations or uncertainties that will have any adverse effect on
Hinsdale's capital resources or operations.

ASSET-LIABILITY MANAGEMENT

As a continuing part of its financial strategy, Hinsdale attempts to
manage the impact of fluctuations in market interest rates on its net interest
income. This effort entails providing a reasonable balance between interest
rate risk, credit risk, liquidity risk and maintenance of yield.
Asset-liability management policies are established and monitored by management
in conjunction with the Board of Directors. The policy establishes guidelines
for acceptable limits on the sensitivity of the market value of assets and
liabilities to changes in interest rates.

The following table illustrates Hinsdale's estimated interest rate
sensitivity and periodic and cumulative gap positions as calculated as of March
31, 1996. An institution with more assets repricing than liabilities over a
given timeframe is considered asset sensitive and will generally benefit from
rising rates.

0-90 91-365 1-5 OVER 5
DAYS DAYS YEARS YEARS TOTAL
------------- ------------- ------------- ------------ ------------
(DOLLARS IN THOUSANDS)

Total assets . . . . . . . . . . . . . . $ 72,268 $ 17,180 $ 17,851 $ 11,246 $118,545
Total liabilities and equity . . . . . . 63,100 14,120 17,766 23,559 118,545
-------- -------- -------- --------
Interest sensitivity gap . . . . . . . . $ 9,168 $ 3,060 $ 85 $(12,313)
======== ======== ======== ========

Cumulative interest sensitivity gap . . . $ 9,168 $ 12,288 $ 12,313
Ratio of cumulative rate
sensitivity gap to rate
sensitive assets . . . . . . . . . . . 7.79% 10.44% 10.45%
Cumulative ratio of rate-sensitive
assets to rate-sensitive
liabilities . . . . . . . . . . . . . 114.52% 115.84% 112.961% 100.00%

To protect the net interest margin from the volatility of the business
cycle, particular attention is given to managing the interest rate spread
between the yield on earning assets and the cost of funds. Management has
determined that this can best be achieved by maintaining a balance sheet with
an asset sensitive posture. The table shown above depicts an interest rate
sensitivity position consistent with management's philosophy.

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126

LIQUIDITY

At The Bank Level. Liquidity management involves planning to meet
anticipated funding needs at a reasonable cost. Liquidity management is guided
by policies formulated and monitored by Hinsdale Bank's Asset/Liability
Committee, which takes into account the marketability of assets, the sources
and stability of funding and the level of unfunded commitments.

"Liquid Assets" refers to money market assets such as Federal funds
sold and interest bearing deposits with banks, as well as available-for-sale
debt securities and held-to-maturity securities with a remaining maturity of
less than one year. Net liquid assets would represent the sum of the liquid
asset categories less the amount of assets pledged to secure public funds. At
December 31, 1995, net liquid assets totaled approximately $38 million,
compared to approximately $31 million at December 31, 1994. Thus, Hinsdale
Bank has substantial short-term balance sheet liquidity.

Long-term liquidity needs are provided by a large core deposit base,
which is the most stable source of liquidity a community bank can have due to
the long-term relationships established with the depositors and the security of
deposit insurance provided by the Federal Deposit Insurance Corporation. At
December 31, 1995, 67% of total assets were funded by core deposits with
balances less than $100,000 while the remaining assets were funded by other
funding sources such as core deposits with balances in excess of $100,000,
public funds, purchased funds, and the capital of Hinsdale Bank. At December
31, 1994, 79% of total assets were funded by core deposits.

Hinsdale Bank routinely accepts deposits from a variety of municipal
entities. Typically, these municipal entities require that banks pledge
marketable securities to collateralize these public deposits. At December 31,
1995 and 1994, Hinsdale Bank had approximately $8,258,000 and $5,640,000 of
securities collateralizing such public deposits, respectively. These amounts
are not considered to be core deposits and the assets that are pledged as
collateral for these deposits are not deemed to be liquid assets.

At the Holding Company Level. Hinsdale's principal funds are
dividends from Hinsdale Bank subsidiary, and if necessary, borrowings or
additional equity offerings. Banking laws place restrictions upon the amount
of dividends which can be paid to Hinsdale by Hinsdale Bank. Based on these
laws, Hinsdale Bank could, subject to minimum capital requirements, declare
dividends to Hinsdale without obtaining regulatory approval in an amount not
exceeding (1) undivided profits, and (2) the amount of net income reduced by
dividends paid for the current and prior two years. No cash dividends were
paid to Hinsdale by the subsidiary during the periods ended December 31, 1995,
1994, or 1993.

Nonaccrual, Past Due and Restructured Loans. Hinsdale Bank had no
nonaccrual loans at March 31, 1996. At December 31, 1995, Hinsdale Bank had
$15,000 of nonaccrual consumer loans. There were no nonaccrual loans at
December 31, 1994 or 1993.

It is the policy of Hinsdale to discontinue the accrual of interest
income on any loan for which there is a reasonable doubt as to the payment of
interest or principal. Nonaccrual loans are returned to an accrual status when
the financial position of the borrower indicates there is no longer any
reasonable doubt as to the payment of principal or interest. Hinsdale had no
significant loans (1) for which the terms of had been renegotiated, or (2) for
which there were serious doubts as to the ability of the borrower to comply
with repayment terms.

Loans past due 90 days or more, including nonaccrual loans at December
31, are presented as follows (in thousands):

DECEMBER 31,
MARCH 31, -----------------------------------
1996 1995 1994 1993
----------- --------- --------- -----------

Loans past due 90 days
or more . . . . . . . . . . . $ 41 $ 99 $ 0 $ 0

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Potential Problem Loans. In addition to those loans disclosed under
"Nonaccrual, Past Due and Restructured Loans," there are certain loans in the
portfolio which management has identified, through its problem loan
identification system, which exhibit a higher than normal credit risk.
However, these loans do not represent non-performing loans to Hinsdale.
Management's review of the total loan portfolio to identify loans where there
is concern that the borrower will not be able to continue to satisfy present
loan repayment terms includes factors such as review of individual loans,
recent loss experience and current economic conditions. Loans in this category
include those with characteristics such as those past maturity more than 45
days, those that have recent adverse operating cash flow or balance sheet
trends, or have general risk characteristics that the loan officer feels might
jeopardize the future timely collection of principal and interest payments.
The principal amount of loans in this category as of December 31, 1995 was
approximately $44,000. Loans in this category generally include loans that
were classified for regulatory purposes. At December 31, 1995, there were no
significant loans which were classified by any bank regulatory agency that are
not included in above as nonaccrual, past due or restructured.

Loan Concentrations. Loan concentrations are considered to exist when
there are amounts loaned to a multiple number of borrowers engaged in similar
activities which would cause them to be similarly impacted by economic or other
conditions. At December 31, 1995, Hinsdale had no concentrations of loans
exceeding 10% of total loans.

Other Real Estate Owned. In addition to the risk elements identified
above, Other Real Estate Owned would provide insight into the historical
quality of the loan portfolio. Hinsdale has had no Other Real Estate Owned
during any of the reporting periods.

THREE MONTHS PERIOD
ENDED YEAR ENDED DECEMBER 31, ENDED
MARCH 31, ----------------------------- DECEMBER 31,
1996 1995 1994 1993
-------------- -------------- -------------- -----------

Balance at beginning of year . . . . . . . . . . $ 479 $ 180 $ -- $ --
Total loans charged-offs . . . . . . . . . . . . -- -- -- --
Total recoveries on loans --
previously charged-off . . . . . . . . . . . -- -- -- --
Add: Provision for possible
loan losses . . . . . . . . . . . . . . . . . 104 299 180 --
------- ------- ------- -------
Balance at end of period . . . . . . . . . . . . $ 583 $ 479 $ 180 $ --
======= ======= ======= =======

Average loans outstanding . . . . . . . . . . . . $62,612 $40,440 $11,374 $19,000
======= ======= ======= =======
Ratio of net charge-offs
during the period
to average loans outstanding
during the period . . . . . . . . . . . . . . 0.00% 0.00% 0.00% 0.00%
======= ======= ======= =======

As of December 31, 1995, management allocated the allowance for
possible loan losses by specific category as shown in the following table
(dollars in thousands). The allocation was made after considering all relevant
qualitative and quantitative factors about the loan portfolio.

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128

PERCENT OF
LOANS IN EACH
CATEGORY TO
AMOUNT TOTAL LOANS
----------- ---------------

Residential real estate . . . . . $ 2 15%
Commercial . . . . . . . . . . . 61 36%
Home equity . . . . . . . . . . . 46 20%
Consumer . . . . . . . . . . . . 70 29%
Unallocated . . . . . . . . . . . 300 N/A
---- ----
Total. . . . . . . . . . . . . . $479 100%
==== ====

Prior to 1995, management did not perform a specific allocation of the
allowance for possible loan losses by category. Management believes that the
loan portfolio is well diversified and well secured, without undue
concentration in any specific risk area. Control of the loan quality is
continually monitored by management and is reviewed by the Board of Directors
and its Credit Committee on a monthly basis. Independent external review of
the loan portfolio is provided by the examinations conducted by regulatory
authorities, independent public accountants in conjunction with their annual
audit, and an independent loan review performed by an entity engaged by the
Board of Directors. The amount of additions to the allowance for possible loan
losses which are charged to earnings through the provision for possible loan
losses are determined based on a variety of factors, actual charge-offs during
the year, historical loss experience, delinquent loans, and an evaluation of
current and prospective economic conditions in the market area. Management
believes the allowance for possible loan losses is adequate to cover any
potential losses.

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129

LIBERTYVILLE BANCORP, INC.

BUSINESS

Organization and Operation. Libertyville Bancorp, Inc.
("Libertyville") is a bank holding company that was incorporated as an Illinois
corporation in September of 1994. The primary asset of Libertyville is its
ownership of 100% of the common shares of Libertyville Bank. Libertyville is
engaged in the business of banking through its ownership of Libertyville Bank.
Its mailing address is 507 North Milwaukee Avenue, Libertyville, Illinois 60048
and its telephone number is (847) 367-6800. As of March 31, 1996, Libertyville
had total assets of $52,542,000 and total stockholders' equity of $9,387,000.

Libertyville Bank was organized under the laws of the State of
Illinois and commenced operation in October, 1995. Libertyville and
Libertyville Bank are regulated by the Federal Reserve Bank. Additionally,
Libertyville Bank is regulated by Illinois Commissioner of Banks and Trust
Companies and the Federal Deposit Insurance Corporation.

Libertyville Bank is the only locally owned and managed full service
commercial bank in its primary service area of Libertyville, Mundelein and
Vernon Hills, Illinois. Each of these villages has a population of
approximately 20,000 and is located approximately 25 miles north of downtown
Chicago.

Employees. As of March 31, 1996, Libertyville Bank employed 21
full-time equivalent employees. Libertyville has no paid employees.

Services. Libertyville Bank is an Illinois chartered, FDIC insured
commercial bank which provides the full range of banking services, including
trust operations. Libertyville Bank furnishes personal and commercial banking
services, including demand, NOW, money market, savings, and time deposit
accounts; real estate, commercial, and consumer loans; and, safe deposit
facilities.

Libertyville Bank was formed to provide the Libertyville and Vernon
Hills communities with a community bank alternative. As such, Libertyville
Bank is focused on providing a highly personal, professional level of service
to commercial and retail customers residing in these areas. Emphasis is placed
on local ownership and management in attracting and maintaining deposit, loan
and trust customers.

Property. Libertyville Bank currently has two physical banking
locations. Libertyville Bank owns the main bank facility that is a 13,000
square foot two story brick building located at 507 North Milwaukee Avenue in
downtown Libertyville, Illinois. Libertyville Bank also owns a 2,500 square
foot drive-in, walk-up banking facility at 201 Hurlburt Court, approximately
five blocks southeast of the main banking facility. Libertyville Bank
maintains automated teller machines at both of its locations. Libertyville
Bank has no offsite automated teller machines.

ADDITIONAL INFORMATION

For a description of Libertyville's and Libertyville Bank's
competition, litigation, regulatory environment, interests in affiliates,
transactions with management and relationship with independent public
accountants, see "MATTERS OF GENERAL APPLICABILITY TO BANKS."

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MANAGEMENT OWNERSHIP OF COMMON STOCK

The following table sets forth information as of March 31, 1996, with
respect to beneficial ownership of shares of Libertyville held by (i) each
director of Libertyville, (ii) each executive officer of Libertyville, and
(iii) all directors and executive officers as a group.

SHARES
ISSUABLE SHARES
UPON SHARES SUBJECT
CONVERSION SUBJECT TO TO TOTAL PRO FORMA
OF COMMON VESTED LIBERTYVILLE % OF % OF
COMMON PREFERRED STOCK STOCK BENEFICIAL LIBERTYVILLE WINTRUST
SHARES(1) SHARES(2) WARRANTS(3) OPTIONS OWNERSHIP TOTAL(4) TOTAL(4)(5)
------------ ----------- ----------- ---------- ------------- ------------ ------------

DIRECTORS
- ---------
Howard D. Adams(6) ** . . . . . 5,300 -- -- -- 5,300 2.31% 7.56%
J. Albert Carstens ** . . . . . 3,216 2,402 2,000 -- 7,618 3.28% *
David A. Dykstra ** . . . . . . 777 641 540 -- 1,958 * *
Donald Flannery . . . . . . . . 1,033 802 660 -- 2,495 1.08% *
Scott Lucas . . . . . . . . . . 500 -- -- -- 500 * *
James E. Mahoney. . . . . . . . 1,620 -- -- -- 1,620 * *
Susan Milligan . . . . . . . . 400 -- -- -- 400 * *
William Newell . . . . . . . . 1,500 -- -- -- 1,500 * *
Hollis W. Rademacher . . . . . 2,533 802 660 -- 3,995 1.73% *
John N. Schaper . . . . . . . . 300 -- -- -- 300 * *
Jane R. Stein . . . . . . . . -- -- -- -- -- * *
Jack Stoneman . . . . . . . . . 4,000 -- -- -- 4,000 1.74% *
Edward Werdell ** . . . . . . . 3,086 962 800 -- 4,848 2.10% *
Edward J. Wehmer ** . . . . . . 854 5,088 1,408 -- 7,350 3.18% 3.20%
------- ------ ------ ---- ------- ----- ----
Total Directors . . . . . . . . 25,119 10,697 6,068 -- 41,884 18.15%

NON-DIRECTOR EXECUTIVE OFFICERS
- -------------------------------
Brian Mikaelian . . . . . . . . 656 319 260 -- 1,235 * *
Randolph Hibben . . . . . . . . 500 -- -- -- 500 * *
Robert F. Key . . . . . . . . . 900 -- -- -- 900 * *
Lloyd M. Bowden . . . . . . . . 1,000 -- -- -- 1,000 * *
------- ------ ------ ---- ------- ----- ----
Total Directors and Executive
Officers as a group . . . . . . 28,175 11,016 6,328 -- 45,519 19.73%
======= ====== ====== ==== ======= ===== ====

Total Common Shares and Share
Equivalents . . . . . . . . . . 205,929 24,000 20,760 -- 250,689
======= ====== ====== ==== =======

- -----------------------
* -- Less than 1%
** -- Denotes executive officer (in addition to director status)

(1) Includes shares held directly and, if applicable, indirectly through such
person's spouse, minor children, certain family trusts, IRA's or 401(k)
plans.

(2) Pursuant to the Reorganization Agreement, all preferred shares are to be
converted to Shares of Common Stock prior to consummation of the
Reorganization. Each share of preferred stock converts into one share of
Common Stock.

(3) After the Effective Date of the Reorganization, Libertyville Common Stock
warrants will continue to represent the right to acquire shares of
Libertyville which will then be a mid-tier holding company and a
subsidiary of Wintrust.

(4) Beneficial ownership percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.

(5) Assumes no exercise of outstanding options, rights or warrants other than
the anticipated exercise of certain First Premium warrants resulting in
399,612 additional shares of Wintrust Common Stock to be outstanding
immediately following the Effective Date of the Reorganization. Includes
shares deemed beneficially owned by such persons in any of the other
Companies, giving effect to the applicable Exchange Ratios and North
Shore Stock Split. Also gives effect to the cancellation of intercompany
share ownership as provided in the Reorganization Agreement.

(6) Includes an aggregate of 1,600 shares held in certain family trusts for
the benefit of Mr. Adams' children and with respect to which Mr. Adams'
wife has voting power; Mr. Adams disclaims beneficial ownership of such
shares.

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BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS

On March 31, 1996, Libertyville had 205,929 shares of common stock
outstanding. As of such date, the following persons not listed under
"Management Ownership of Common Stock" are known by Libertyville to be the
owners of or might be deemed to be the beneficial owners of more than 5% of its
common stock.

Number of Shares Percent of
Name Address Beneficially Owned Class(1)
------------------------- ------------------------- ------------------------ -------------------------

Emmett D. McCarthy, as
trustee for(2):

Alan W. Adams 570 Crabtree 15,479(1) 6.53%(1)
Family Trust Lake Forest, IL

Sarah K. Adams 570 Crabtree 15,479(1) 6.53%(1)
Family Trust Lake Forest, IL

- ---------------
(1) Beneficial ownership percentages are calculated in accordance with SEC Rule
13d-3 promulgated under the Securities Exchange Act of 1934.

(2) The Alan W. Adams Family Trust and the Sarah K. Adams Family Trust are each
irrevocable trusts for which Emmett McCarthy and either Alan W. Adams or
Sarah K. Adams, respectively, serve as co-trustees. Mr. McCarthy is a
Director of Crabtree. The 15,479 shares shown for each Trust represent 1,771
shares of Common Stock, 6,492 shares of Preferred Stock which are
convertible into Common Stock at a ratio of 1:1, and warrants to acquire
7,216 shares of Common Stock. The beneficial owners of the respective
Trusts are Alan W. Adams and Sarah K. Adams, respectively, the two adult
children of Howard D. Adams, and Mr. McCarthy disclaims beneficial ownership
of all shares shown. Mr. Alan W. Adams is currently a vice president of
Lake Forest Bank and a Director nominee of Wintrust, and he directly owns an
additional 180 shares.

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SELECTED FINANCIAL DATA
LIBERTYVILLE BANCORP, INC.

Three Months Period Ended
Ended March 31, December 31,
1996 1995(1)
-------------------- --------------
(dollars in thousands)

Interest income . . . . . . . . . . . . . . . . . . . . . . . . $ 645 $ 321
Interest expense . . . . . . . . . . . . . . . . . . . . . . . 416 164
-------- --------
Net interest income . . . . . . . . . . . . . . . . . . . . . . 229 157
Provision for possible loan losses . . . . . . . . . . . . . . 75 55
-------- --------
Net interest income after provision for possible loan losses . 154 102
Noninterest income, excluding security gains (losses) . . . . . 57 21
Security gains . . . . . . . . . . . . . . . . . . . . . . . . 0 0
Noninterest expense . . . . . . . . . . . . . . . . . . . . . . 546 1,081
-------- --------
Net loss before income taxes . . . . . . . . . . . . . . . . . (335) (958)
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . -- --
-------- --------
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (335) (958)
======== ========

Net loss per common share . . . . . . . . . . . . . . . . . . . $ (1.64) $ (14.19)
Cash dividends declared per common share . . . . . . . . . . . $ 0 $ 0

Total assets at end of period . . . . . . . . . . . . . . . . . $ 52,542 $ 37,479
Total deposits at end of period . . . . . . . . . . . . . . . . 42,575 26,413
Secured-term debt at end of period . . . . . . . . . . . . . . 361 1,064
Preference stock at end of period . . . . . . . . . . . . . . . 500 500

Return on average total assets . . . . . . . . . . . . . . . . (2.91%) --(2)
Return on average common shareholders' equity . . . . . . . . . (14.10%) --(2)

- -----------------
(1) Management has for this period presented selected financial data
reflecting reported results from the date of incorporation (September 26,
1994) to December 31, 1995. The Company was in a capital raising and
organizational phase and as described elsewhere herein was only
operational from October 10, 1995 through December 31, 1995. Accordingly,
management believes that separate selected financial data from the date of
incorporation (September 26, 1994) to December 31, 1994 and for January 1,
1995 to December 31, 1995 is not meaningful as the period presented herein
approximates those revenues and expenses that would have been recognized
had 1995 been presented on a stand-alone calendar year basis.

(2) Return on average assets and average equity ratios are not meaningful as a
result of the nature of operations as discussed in Note 1 above.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

General. Libertyville was organized and approved as a one bank
holding company in 1995. Additionally, Libertyville Bank was approved to begin
banking operations in October of 1995. As such, the following discussion of
the results of operations include the activity of Company during its
organizational period and the results as a functioning one-bank holding company
during the period of October 10, 1995 through December 31, 1995. Generally,
community bank holding companies' results of operations are reliant upon the
net interest income to produce an overall profit for the company. However, as
Libertyville Bank was only operational for less than three months, the revenues
generated through net interest income were not sufficient to offset
organizational expenses and the company experienced a loss. This is not
unusual for a start-up banking organization and was anticipated by

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management during its initial planning. The following discussion will focus on
describing the components of the net loss incurred for the three months ended
March 31, 1996 and the period ended December 31, 1995.

RESULTS OF OPERATIONS

Comparison of Results for the Period Ended March 31, 1996 to the Period Ended
December 31, 1995

The net loss for the three-month period ended March 31, 1996 was
$335,000. The following discussion will compare the results for the first
quarter of 1996 to the last quarter of 1995 due to the fact that Libertyville
Bank was only operational during that period in 1995.

Net interest income increased to $229,000 for the three months ended
March 31, 1996 from approximately $157,000 for the period ended 1995. This
increase is a result of a substantial increase in interest earning assets since
the inception of operations and the fact that the mix of interest earning
assets has gradually shifted more into higher yielding loans from short-term
money market investment products. Management anticipates that the net interest
income amount will continue to grow in the remaining quarters of 1996 due to
the continuation of the growth in earning assets, specifically the loan
category.

The provision for possible loan losses increased to $75,000 for the
three months ended March 31, 1996 compared to $55,000 for the period ended
December 31, 1995. Libertyville Bank has provided a higher amount to the
allowance for possible loan losses during the first quarter of 1996 as compared
to the period ended 1995 because of the growth in the loan portfolio. Although
the Libertyville Bank has no non-performing loans or loans past due greater
than 90 days, management considers it prudent to build a reserve for
unanticipated credit problems that may occur with the existing portfolio.

Other noninterest income totaled $57,000 for the three months ended
March 31, 1996 compared to approximately $21,000 for the period ended 1995 that
Libertyville Bank was operational. The increase is predominantly related to
fees on fixed rate residential mortgage loans which were sold to the secondary
market. During 1995, this activity was just underway and customer
relationships were being established, whereas in 1996, the service has become
an established function at Libertyville Bank and has generated the additional
revenues.

Other noninterest expenses were $546,000 for the three-month period
ended March 31, 1996 compared to $1,081,000 for the period ended December 31,
1995. If the organizational period expenses are deducted from the total, the
other noninterest expenses related to the three-months in which Libertyville
was operation were $607,000. The slight decrease to $546,000 from $607,000 in
the comparable operational periods was due primarily to the fact that
significant marketing, advertising, and supplies were expended in 1995 to
successfully announce the grand opening of the facility. During the first few
months of 1996, these expenses were modestly reduced.

Operating Results for the Period Ended December 31, 1995

General. Libertyville had a net loss of $958,000 for the period ended
December 31, 1995. The net loss was primarily a result of $1,081,000 of
noninterest expenses such as salaries and employee benefits, occupancy-related
expenses, marketing expenses, stationery and supplies and other sundry
expenses. These expenses were offset by approximately $157,000 in net interest
income and $21,000 in miscellaneous fee income. Libertyville Bank also charged
$55,000 against earnings as a provision for possible loan losses which
contributed to the loss position. These and other details will be discussed in
greater detail in the following sections.

Interest Income and Interest Expense. The primary source of earnings
for Libertyville during the period ended 1995 was net interest income. In
fact, net interest income accounted for approximately 88% of the net revenues
during the period ended 1995. Net interest income is defined as the difference
between interest income and fees on earning assets and interest expense on
deposits and borrowings. An analysis of the components and characteristics of
interest income and interest expense is presented in the table below, including
average balances

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and average rates/yields for Libertyville Bank's earning assets and
interest-bearing liabilities for the period ended December 31, 1995.

1995
-------------------------------------------
AVERAGE AVERAGE
BALANCE INTEREST YIELD/RATE
-------------- ------------ ---------------
(DOLLARS IN THOUSANDS)

ASSETS
Interest bearing deposits with banks . . . . . . . . . . . . . . $1,695 $ 80 4.72%
Federal funds sold . . . . . . . . . . . . . . . . . . . . . . . 2,894 166 5.74%
Taxable debt securities . . . . . . . . . . . . . . . . . . . . . 34 2 5.88%
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . 38 0 0.00%
Loans, net of unearned discount . . . . . . . . . . . . . . . . . 841 73 8.68%
------ ----- ----
Total earning assets . . . . . . . . . . . . . . . . . . . . . . 5,502 321 5.83%
------ ----- ----

Cash and due from banks-noninterest bearing . . . . . . . . . . . 819
Allowance for possible loan losses . . . . . . . . . . . . . . . (3)
Premises and equipment, net . . . . . . . . . . . . . . . . . . . 1,343

Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . 230
---

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . $7,391
======

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits-interest bearing
NOW accounts . . . . . . . . . . . . . . . . . . . . . . . . . $ 97 3 3.09%
Savings and money market deposits . . . . . . . . . . . . . . . 713 30 4.21%
Certificates of deposit . . . . . . . . . . . . . . . . . . . . 1,735 108 6.22%
------ ----- ----
Total interest-bearing deposits . . . . . . . . . . . . . . . 2,545 141 5.54%
------ ----- ----

Notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . 793 23 2.90%
Term-debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 0 0.00%
------ ----- ----
Total interest-bearing liabilities . . . . . . . . . . . . . . . 3,342 164 4.91%
------ ----- ----

Noninterest bearing deposits . . . . . . . . . . . . . . . . . . 427
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . 23
Shareholders' equity . . . . . . . . . . . . . . . . . . . . . . 3,599
------

Total liabilities and shareholders' equity . . . . . . . . . . $7,391
======

Interest income/average earning assets . . . . . . . . . . . . . 5.83%
Interest expense/average interest-bearing liabilities . . . . . . 4.91%
----
Net interest spread . . . . . . . . . . . . . . . . . . . . . . . $ 157 0.92%
===== ====

Net interest margin(1) . . . . . . . . . . . . . . . . . . . . . 2.85%
====

- ----------------
(1) Net interest margin represents net interest income as a percent of the
average earning assets for the period.

Interest Income. As shown in the table above, the primary source of
interest income was derived from short-term money market investments such as
Federal funds sold and interest bearing deposits with banks. It was
management's intention to invest primarily in high credit quality investments
which were extremely liquid during the initial months of operations until a
stable core deposit base could be established. These types of investments
provide a much lower yield than investments in loans and other investment
products with extended maturities. As such, the overall yield on the average
earning assets for the period ended December 31, 1995 was only 5.83%,

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providing only a slight net interest spread of 0.92% to interest-bearing
liabilities. Management is confident that the overall earning asset yield and
its spread to the rates paid on interest-bearing liabilities will increase
substantially as the deposit base grows and matures and as those funds are
invested more predominantly in higher yielding loan accounts.

Interest Expense. The information provided in the table above
indicates that the vast majority of the interest expense related to
certificates of deposits. As discussed in the "Financial Condition" section
below, Libertyville Bank offered a variety of special deposit account
promotions during its initial months of operations in 1995. The most popular
product for Libertyville Bank's initial depositors was the certificate of
deposit accounts. Accordingly, the bulk of the interest expense was
concentrated in that category. During the initial stages of 1996, Libertyville
Bank has experienced significant deposit growth in all deposit categories
resulting in a more diverse deposit base.

The Company also incurred approximately $23,000 in interest expense on
debt outstanding which financed the acquisition of Libertyville Bank's two
banking facilities. The rate indicated in the table above is less than the
rate paid because a certain amount of interest expense was capitalized during
the construction of the facilities. Please refer to Footnote 2 of the audited
consolidated financial statements for a detailed description of the terms of
the debt.

Provision for Possible Loan Losses. Management recorded a charge
against earnings of $55,000 for the provision for possible loan losses.
Although the loan portfolio was recently originated and management clearly did
not anticipate any losses on the loans just closed, it was deemed prudent to
provide for an allowance for possible loan losses. Based upon the $55,000
provision and the $10,189,000 of loans outstanding at December 31, 1995, the
allowance for possible loan losses stood at 0.54% of loans outstanding.
Management feels is adequate to cover potential losses in the portfolio. There
can be no assurance that future losses will not exceed the amounts provided for
thereby affecting future results of operations. Management will continue to
provide for possible loan losses in 1996; however, the magnitude of future
additions to the allowance for possible loan losses are dependent upon loan
growth, the economy, changes in real estate values, interest rates, the view of
regulatory agencies toward adequate reserve levels, and past due and
non-performing loan levels.

Other Noninterest Income. Noninterest income totaled $21,000 for the
period ended 1995. Approximately $14,000 of the noninterest income was
attributable to fees on loans sold. Fees on loans sold relate to income
received by Libertyville Bank for its services of originating and selling
residential real estate loans into the secondary market. The remaining
increase in noninterest income of $7,000 is a result of insignificant
miscellaneous fees collected in the period ended 1995.

Salaries and employee benefits . . . . . . . . . $ 514
Occupancy expenses . . . . . . . . . . . . . . . 46
Advertising and marketing . . . . . . . . . . . . 127
Depreciation - furniture and equipment . . . . . 27
Stationery and supplies . . . . . . . . . . . . . 95
Other noninterest expenses . . . . . . . . . . . 272
------
Total noninterest expenses . . . . . . . . . . $1,081
======

The following discussion will review changes related to individual components
of noninterest expenses.

Salaries and Employee Benefits. Libertyville began to accumulate
staff in May of 1995 as the company began the process of organizing a bank
holding company and chartering a new bank. A full staffing complement was
achieved by October of 1995 when Libertyville Bank received regulatory approval
and began to operate. At October 1995 and through December 31, 1995,
Libertyville Bank had approximately 20 full-time equivalent

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employees to perform all the operations, customer service, lending and
administration of the main banking location and its drive-up banking facility.
Approximately $279,000 of the total salaries and employee benefits expense was
incurred during the startup phase with the remaining $235,000 of this expense
category incurred subsequent to the opening of Libertyville Bank. Management's
philosophy in staffing Libertyville Bank was to attract the best individuals to
properly establish Libertyville Bank as a dominant customer service oriented
bank in the Libertyville, Illinois market area. As such, the staffing level of
20 full-time equivalent employees and the amount of expense recorded during the
start-up phase were deemed appropriate in order to institute a solid customer
service oriented bank with a strong level of internal controls. Management
also anticipated a reasonably rapid growth rate in its deposit base and
determined that the staffing level would be sufficient to support growth during
the initial six to twelve months of operations.

Occupancy Expenses. Occupancy expenses include those expenses which
relate directly to the operation of the buildings, improvements and property.
The major components of occupancy expense in the period ended 1995 were $18,600
for depreciation of the two buildings and their improvements, $14,800 for
utilities expense such as electricity, gas, water, and sewer charges, and
$12,900 for property taxes. Additionally, Libertyville Bank incurred other
sundry operating expense related to the occupancy of the buildings of
approximately $11,900. Offsetting these expenses was approximately $12,700 of
rental income collected from tenants of the main bank facility.

Advertising and Marketing. Marketing and advertising expenditures
amounted to approximately $127,000 for the period ended 1995. As a new banking
organization, expenditures on marketing products and advertising were essential
to communicate the concept of opening a new community oriented bank to the
residents of the market area. Libertyville Bank developed many community
oriented deposit and loan products to attract its deposit base during its
initial months of operation and determined that expenditures for marketing
these products was imperative. Management believes the advertising and
marketing expenses were instrumental in achieving the rapid growth in the
deposit base which has resulted during the time period since the inception of
Libertyville Bank and, consequently, appropriately incurred. Management
anticipates that appropriate but relatively high levels of marketing expenses
will be incurred in 1996 as Libertyville Bank continues to establish its base
of customers.

Depreciation -- Furniture and Equipment. The $27,000 of depreciation
expense in this category represents the depreciation on the furniture and
equipment purchased to outfit Libertyville Bank. The depreciation expense
began in October of 1995, the time when the items were placed in service. This
expense category should continue to charge earnings at the same relative
monthly pace because Libertyville Bank was fully furnished upon its opening.

Stationery and Supplies. Stationery and supplies expense totaled
approximately $95,000 for the period ended 1995. As Libertyville Bank was a
new bank in 1995, it had to purchase an entire inventory of stationery and
other administrative supplies. Many of these supplies were used in the initial
months for mailings to customers, office supplies to equip employees' desks,
deposit and withdrawal tickets for use in the lobbies, and many other uses.
The amount expended on supplies in future periods should not approach the
historical level of spending due to the one time expense associated with some
of these initial supply demands.

Other Noninterest Expenses. This category of expenses represents
insurance expense, data processing expense, postage expense, amortization of
organizational costs, audits and examinations expense, and other sundry
expenses. Of the $272,000 recorded in this expense category, approximately
$119,000 was incurred during the start-up phase of the organization, the
remaining amounts were incurred subsequent to the opening of Libertyville Bank.
Of the amounts incurred while Libertyville Bank was operational, approximately
$23,000 related to legal, accounting and other professional fees, $16,000
related to data processing expenses, $10,000 for insurance, and $13,000 for
postage expense. The remaining expense amounts were disbursed among many
different categories and were not individually significant. Controlling
overhead expenses is a basic philosophy of management and is continually
evaluated to determine whether additional expense savings are possible without
impairing the goal of providing superior customer service.

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Income Taxes. Libertyville had no Federal or state income tax expense
for the period ended 1995. Management has established a valuation allowance
against its net deferred tax assets with the result being that no Federal or
state income tax expense or benefit was realized in the financial statements.
Management anticipates that income tax expense or benefit will begin to be
recorded when Libertyville's earnings history and projected future earnings are
sufficient to make a judgment that the realization of the net deferred tax
asset is more likely than not.

FINANCIAL CONDITION

The dynamics of a community bank's balance sheet is generally
dependent upon the ability of management to attract additional deposit accounts
to fund the growth of the institution. This is the current situation at
Libertyville Bank as it is a new institution which is still diligently
attempting to establish itself as the bank of choice in a significant amount of
households and businesses in the communities it serves. Accordingly, the
discussion of the financial condition of Libertyville Bank will focus first on
the sources of funds received through the liability side of the balance sheet
which is predominantly deposit growth. After it is understood how Libertyville
Bank was funded during the periods under discussion, the latter section of this
"Financial Condition" discussion will focus on the asset categories where
Libertyville invested the funds.

Deposits. Total deposits balances were $26,413,000 at December 31,
1995 and $42,575,000 at March 31, 1996. The deposit growth was a result of
effective marketing of Libertyville Bank's community oriented deposit products,
management and director interaction with the community, and the dedication of
the experienced staff assembled to service a new customer base.

MARCH 31, 1996 DECEMBER 31, 1995
--------------------------------- ----------------------------------
PERCENT OF PERCENT OF
BALANCE AT TOTAL DEPOSITS BALANCE AT TOTAL DEPOSITS
--------------- --------------- --------------- ----------------
(DOLLARS IN THOUSANDS)

Demand . . . . . . . . . . . . . $ 7,282 17.1% $ 3,728 14.1%
Savings . . . . . . . . . . . . . 6,906 16.2% 4,063 15.4%
NOW . . . . . . . . . . . . . . . 1,441 3.4% 768 2.9%
Money market . . . . . . . . . . 3,046 7.2% 2,572 9.7%
Certificates of Deposit . . . . . 23,900 56.1% 15,282 57.9%
------- ----- ------- -----
Total Deposits . . . . . . . . . $42,575 100.0% $26,413 100.0%
======= ===== ======= =====

Deposit growth occurred in all major deposit categories as shown in
the table above; however, certificates of deposit comprised the majority of the
total deposits. Libertyville Bank offered a variety of special deposit account
promotions during its initial months of operations in 1995. Customers who
opened a combination of accounts (generally a combination of an
interest-bearing account and a noninterest bearing account) were afforded
special privileges as "founding" depositors of Libertyville Bank. These
privileges included such rights to receive free safe deposit boxes, favorable
loan deposit rates as compared to the stated market rates, and other selected
perquisites. The most popular product for Libertyville Bank's initial
depositors was the certificate of deposit accounts. Libertyville Bank
continues to aggressively promote its products to the community and attempts to
meld its competitive products with superior customer service. The result
should be a continuing growth in all deposit categories throughout 1996.

Reference is made to the average balance/rate table for data regarding
average daily deposits and rates paid thereon for the period ended December 31,
1995. Libertyville Bank has no foreign deposits.

The aggregate amounts of time deposits, in denominations of $100,000
or more, by maturity, as of December 31, 1995 are shown below (in thousands):

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Three months or less . . . . . . . . . . . . . . . $ 720
Over three through six months . . . . . . . . . . . 0
Over six through twelve months . . . . . . . . . . 1,942
Over twelve months . . . . . . . . . . . . . . . . 1,448
------
Total . . . . . . . . . . . . . . . . . . $4,110
======

Accrued Interest Payable and Other Liabilities. Accrued interest
payable and other liabilities as of December 31, 1995 were $110,000. The
balance is comprised of $46,000 for accrued interest payable on deposit
accounts and $64,000 related to all other miscellaneous other liabilities, none
of which are individually material.

Notes Payable. Libertyville borrowed $1,770,000 to fund the purchase
of real estate and to cover initial start-up expenses. This debt was paid down
to $1,064,000 by December 31, 1995, primarily with the proceeds received
through the issuance of common shares in a private placement offering. On
January 5, 1996, this debt was further reduced by $703,000. The remaining
outstanding note balance bears interest at 9% per annum, amortizes monthly and
matures on July 1, 1999.

Total Assets and Earning Assets. Total assets and earning assets were
$37,479,000 and $31,979,000, respectively, at December 31, 1995. The level of
earning assets as a percentage of total assets was approximately 85% of total
assets. Management expects that the ratio of earning assets as a percentage of
total assets will increase during 1996 to a level approaching 88% to 89%. It
is desirable to have a higher level of assets invested in earning assets;
however, due to the disproportionate amount of building and premises needed to
establish the banking locations, the ratio was lower than Libertyville Bank's
peer group during the initial months of operation. These components of earning
assets will be discussed further in the sections below.

Loans. The following table shows the categories of loans at March 31,
1996 and December 31, 1995 (in thousands):

MARCH 31, DECEMBER 31,
1996 1995
---------- --------------

Residential real estate . . . . . . $ 1,195 $ 179
Commercial . . . . . . . . . . . . 12,101 6,526
Home equity . . . . . . . . . . . . 2,696 751
Consumer . . . . . . . . . . . . . 6,319 2,733
------- -------
Total gross loans 22,311 10,189
Less unearned discount . . . . . . -- --
------- -------
Net loans . . . . . . . . . . . $22,311 $10,189
======= =======

Total loans amounted to $10,189,000 at December 31, 1995. As can be
seen from the table above, significant growth occurred primarily in the
Commercial and Consumer loan categories. It should be noted that management
was cautious in making loans during the initial months of operations until a
stable core deposit base could be established; however, loan product
development and customer relationships evolved during 1995 and into 1996 which
should result in healthy loan growth during Libertyville Bank's first full year
of operation. The following paragraphs will highlight the growth by loan type.

The Commercial loan category includes $2,763,000 of commercial loans
to small-to-medium size businesses that are primarily secured by general
business assets and personal guarantees. These loans have been made to
established companies where the lending officers have had previous relationship
history. This category also includes approximately $1,473,000 of loans secured
by income producing real estate property and approximately $2,290,000 of
investment grade commercial paper. Therefore, this category of commercial
loans is well diversified. The continued growth in this category subsequent to
year-end 1995 is a result of business development activities of Libertyville
Bank's senior officers and the movement of certain commercial loan accounts to
Libertyville Bank based upon prior relationships with Libertyville Bank's
lending officers.

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Consumer loans outstanding at December 31, 1995 were $2,733,000.
Approximately $2,110,000 of this balance is related to the purchase of fixed
rate indirect automobile loans. These indirect automobile loans are purchased
from Hinsdale Bank and Trust Company, an affiliated bank, and are loans secured
by new and used automobiles. These credits generally have an original maturity
of 36 to 60 months; however, the average actual maturity is estimated to be
approximately 37 months. The risk associated with this portfolio is
diversified amongst many individual borrowers.

Residential real estate and home equity loans did not comprise a
significant portion of the loan portfolio as of December 31, 1995.

Libertyville has no loans to businesses or governments of foreign
countries.

Money Market Investments and Investment Securities. Libertyville
Bank's objective in managing its securities portfolio is to balance
Libertyville Bank's liquidity risk, interest rate risk and credit quality such
that the earnings of Libertyville Bank are maximized. As noted in the
"Interest Income" section above, the predominant portion of the funds received
from new deposit accounts was invested in the short-term money market
investment categories during 1995. The following table identifies of the
financial statement categories in which Libertyville Bank invested its
short-term funds as of March 31, 1996 and December 31, 1995 (in thousands):

MARCH 31, DECEMBER 31,
1996 1995
-------------- ----------------

Federal funds sold . . . . . . . . . . . $11,285 $14,690
Interest bearing deposits with banks . . 9,000 6,500
Investment securities . . . . . . . . . . 4,588 600
------- -------
Total money market investments and
investment securities . . . . . . . . $24,873 $21,790
======= =======

Investment Securities. The carrying value of securities held by
Libertyville at December 31, 1995 (in thousands):

Available-for-Sale
Federal Reserve Bank stock . . . . . . . $150
Equity securities . . . . . . . . . . . . 450
----
Total available-for-sale . . . . . . . $600
====

Libertyville Bank is a member of the Federal Reserve Bank and is
required, as a condition of membership, to own stock based upon the level of
capital and surplus of Libertyville Bank. Accordingly, Libertyville Bank
invested $150,000 in the Federal Reserve Bank. The $450,000 investment in
equity securities represents an investment made by the holding company in North
Shore Community Bancorp, Inc., an affiliated bank holding company.

All of the securities owned by Libertyville were held as
available-for-sale.

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Maturities of securities as of December 31, 1995 are as follows (in
thousands):

WITHIN FROM 1 FROM 5 TO AFTER EQUITY
1 YEAR TO 5 YEARS 10 YEARS 10 YEARS SECURITIES TOTAL
------------ ------------ ------------ ------------ ------------ ------------

Federal Reserve Bank stock . . . . $ -- $ -- $ -- $ -- $150 $150
Equity securities . . . . . . . . -- -- -- -- 450 450
------ ------ ------- ------- ---- ----
Total . . . . . . . . . . . . $ -- $ -- $ -- $ -- $600 $600
====== ====== ======= ======= ==== ====

The weighted average yield for each range of maturities of securities is shown
below as of December 31, 1995:

WITHIN FROM 1 FROM 5 TO AFTER FEDERAL
1 YEAR TO 5 YEARS 10 YEARS 10 YEARS RESERVE BANK TOTAL
---------- ---------- ---------- ----------- -------------- ------

Federal Reserve Bank stock N/A N/A N/A N/A 6.00% 6.00%
Equity securities . . . . . . . . N/A N/A N/A N/A N/A N/A

Yields on equity securities are not considered meaningful for purposes
of this analysis.

Libertyville did not own any federally tax-advantaged securities
during the periods presented.

There were no securities of any single issuer which had book value in
excess of 10% of shareholders' equity at December 31, 1995.

Shareholders' Equity. Libertyville was incorporated on September 26,
1994 and initially capitalized through the issuance of 1,000 no par common
shares at $1 each; 10,000 no par preferred convertible shares at $50 each; and
5,000 no par common stock series A warrants at $5 each. Each series A warrant
entitles the holder to acquire one share of common stock at a purchase price of
$50.

Subsequent to the initial capitalization, Libertyville raised an
additional $10,030,000 through the private placement issuance of 200,689 no par
common shares. During the initial period of operations, Libertyville allocated
$1,000,000 of the initial surplus to undivided profits to cover initial
operating expenditures.

Subsequent to the private placement of the 200,689 shares of common
shares, the shareholders approved the Libertyville Bancorp, Inc. 1995
Recapitalization Plan ("Plan") which provided for the exchange of the 10,000
existing shares of preferred convertible stock for new preferred shares and
common stock warrants. Under the Plan, the existing preferred shareholders
received 2.4 shares of new Series B Preferred stock and two Series B Common
Stock Warrants for each share of existing preferred shares held. As such,
subsequent to the Plan, 24,000 Series B Preferred Shares and 20,000 Series B
Common Stock Warrants are outstanding.

The Series B Common Stock Warrants have a ten year life. Each warrant
entitles the holder to purchase one share of the Common Stock at a purchase
price of $40 per share.

The Series B Preferred Stock is non-voting and will not pay dividends
for a period of at least ten years from issuance and thereafter, dividends, if
any, will not be cumulative. Each share of Series B Preferred Stock is
convertible into one share of Common Stock.

The following table presents certain ratios relating to Libertyville's
equity at March 31, 1996 and December 31, 1995 for Libertyville:

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MARCH 31, DECEMBER 31,
1996 1995
-------------- -----------------

Ending tier 1 risk-based capital ratio. . . 28.6% 52.6%
Ending total risk-based capital ratio . . . 29.0% 52.9%
Ending leverage ratio . . . . . . . . . . . 17.7% 25.3%
Dividend payout ratio . . . . . . . . . . . 0.0% 0.0%

The leverage ratios, tier 1 risk-based capital ratios and total
capital ratios all exceed the "well capitalized" levels established by
regulatory agencies of 5%, 6% and 10%, respectively. The capital ratios
declined between December 31, 1995 and March 31, 1996 due to the substantial
asset growth during the period. As a de novo banking institution,
Libertyville's subsidiary bank is required to maintain a leverage ratio in
excess of 9% during its first three years of operation. In order to fulfill
its obligation under the 9% limit, Libertyville raised sufficient capital at
the holding company level to support the anticipated asset growth of
Libertyville Bank during its initial 12 to 24 months of operations. After that
period, if asset growth required additional capital at Libertyville Bank level,
Libertyville would consider capitalizing Libertyville Bank with additional
funding from the holding company which would be raised in the form of debt or
additional capital offerings.

Management is not aware of any known trends, events, regulatory
recommendations or uncertainties that will have any adverse effect on
Libertyville's capital resources or operations.

ASSET-LIABILITY MANAGEMENT

As a continuing part of its financial strategy, Libertyville attempts
to manage the impact of fluctuations in market interest rates on its net
interest income. This effort entails providing a reasonable balance between
interest rate risk, credit risk, liquidity risk and maintenance of yield.
Asset-liability management policies are established and monitored by management
in conjunction with the Board of Directors. The policy establishes guidelines
for acceptable limits on the sensitivity of the market value of assets and
liabilities to changes in interest rates.

The following table illustrates Libertyville's estimated interest rate
sensitivity and periodic and cumulative gap positions as calculated as of March
31, 1996. An institution with more assets repricing than liabilities over a
given timeframe is considered asset sensitive and will generally benefit from
rising rates.

0-90 91-365 1-5 OVER 5
DAYS DAYS YEARS YEARS TOTAL
----------- ---------- ---------- ---------- ------------
(DOLLARS IN THOUSANDS)

Total assets . . . . . . . . . . . $32,705 $ 3,279 $ 7,306 $ 9,252 $52,542
Total liabilities and equity . . . 15,744 12,141 7,176 17,481 52,542
------- ------- ------- -------
Interest sensitivity gap . . . . . $16,961 $(8,862) $ 130 $(8,229)
======= ======= ======= =======

Cumulative interest sensitivity gap $16,961 $ 8,099 $ 8,229
Ratio of cumulative rate sensitivity
gap to rate sensitive assets . . 32.67% 15.85% 16.11%
Cumulative ratio of rate-sensitive
assets to rate-sensitive
liabilities . . . . . . . . . . 207.73% 129.04% 123.47% 100.00%

To protect the net interest margin from the volatility of the business
cycle, particular attention is given to managing the interest rate spread
between the yield on earning assets and the cost of funds. Management has
determined that this can best be achieved by maintaining a balance sheet with
an asset sensitive posture. The table shown above depicts an interest rate
sensitivity position consistent with management's philosophy.

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LIQUIDITY

At The Bank Level. Liquidity management involves planning to meet
anticipated funding needs at a reasonable cost. Liquidity management is guided
by policies formulated and monitored by Libertyville Bank's Asset/Liability
Committee, which take into account the marketability of assets, the sources and
stability of funding and the level of unfunded commitments.

"Liquid assets" refers to money market assets such as Federal funds
sold and interest bearing deposits with banks, as well as available-for-sale
debt securities and held-to-maturity securities with a remaining maturity less
than one year. Net liquid assets would represent the sum of the liquid asset
categories less the amount of assets pledged to secure public funds. At
December 31, 1995, net liquid assets totaled approximately $xx million. Thus,
Libertyville Bank has substantial short-term balance sheet liquidity.

Long-term liquidity needs are provided by a large core deposit base,
which is the most stable source of liquidity a community bank can have due to
the long-term relationships established with the depositors and the security of
deposit insurance provided by the Federal Deposit Insurance Corporation. At
December 31, 1995, 64% of total assets were funded by core deposits with
balances less than $100,000 while the remaining assets were funded by other
funding sources such as core deposits with balances in excess of $100,000,
public funds, purchased funds, and the capital of Libertyville Bank.

Libertyville Bank may in the future accept deposits from a variety of
municipal entities. Typically, these municipal entities require that banks
pledge marketable securities to collateralize these public deposits. At
December 31, 1995, Libertyville Bank had none of these public deposits;
however, if received in the future, these deposits will not be considered core
deposits and the assets that are pledged as collateral for these deposits will
not deemed to be liquid assets.

At the Holding Company Level. Libertyville's principal funds are
dividends from Libertyville Bank subsidiary, and if necessary, borrowings or
additional equity offerings. Banking laws place restrictions upon the amount
of dividends which can be paid to Libertyville by Libertyville Bank. Based on
these laws, Libertyville Bank is not permitted to pay dividends until such time
as any previous operating losses have been recovered through earnings. As
such, no cash dividends were paid to Libertyville by the subsidiaries during
the periods ended December 31, 1995.

Also, Libertyville Bank is required to maintain a 9% capital to asset
ratio for three years as a de novo Bank, and is not allowed to pay dividends
during this de novo time period without prior approval of the banking
regulators. This three year period ends as of October, 1998.

Subsequent to the three year de novo period, Libertyville Bank could,
subject to minimum capital requirements, declare dividends to Libertyville
without obtaining regulatory approval in an amount not exceeding (1) undivided
profits, and (2) the amount of net income reduced by dividends paid for the
current and prior two years.

At January 1, 1996, Libertyville Bank was not allowed to pay dividends
based upon the above mentioned restrictions.

Nonaccrual Past Due and Restructured Loans. Libertyville had no
nonaccrual loans or loans past due 90 days or more at March 31, 1996 or
December 31, 1995.

Potential Problem Loans. Management has not identified any loans in
the portfolio through its problem loan identification system which exhibit a
higher than normal credit risk. The lack of problem loans is expected by
management because all loans have been outstanding less than three months (the
time period Libertyville Bank has been open).

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Management continually reviews the total loan portfolio to identify
loans where there may be a concern that the borrower will not be able to
continue to satisfy present loan repayment terms. Factors that management
analyzes to determine whether a loan could be a problem loan include current
economic conditions, loans such as those past maturity more than 45 days,
borrowers that have recent adverse operating cash flow or balance sheet trends,
or have general risk characteristics that the loan officer feels might
jeopardize the future timely collection of principal and interest payments.
Loans in this category generally include loans that were classified for
regulatory purposes. At December 31, 1995, there were no significant loans
which were classified by any bank regulatory agency. At December 31, 1995,
Libertyville Bank was not a lender for any highly-leveraged transactions.

Loan Concentrations. Loan concentrations are considered to exist when
there are amounts loaned to a multiple number of borrowers engaged in similar
activities which would cause them to be similarly impacted by economic or other
conditions. At December 31, 1995, Libertyville Bank had no concentrations of
loans exceeding 10% of total loans.

Other Real Estate Owned. In addition to the risk elements identified
above, Other Real Estate Owned would provide insight into the historical
quality of the loan portfolio. Libertyville Bank has had no Other Real Estate
Owned during any of the reporting periods.

THREE MONTHS ENDED PERIOD ENDED
MARCH 31, DECEMBER 31,
1996 1995
----------------------- ------------------

Balance at beginning of period . . . . . $ 55,000 $ --
Total loans charged-off . . . . . . . . . -- --
Total recoveries on loans
previously charged-off . . . . . . . . -- --
Add: Provision for possible loan
losses . . . . . . . . . . . . . . . . 75,000 55,000
----------- --------
Balance at end of period . . . . . . . . $ 130,000 $ 55,000
=========== ========

Average loans outstanding . . . . . . . . $15,536,000 $841,000
=========== ========

Libertyville has not allocated the allowance for possible loan losses
by specific category due to the start-up nature of Libertyville Bank.
Libertyville will allocate the allowance for possible loan losses to specific
loan categories when the portfolio characteristics begin to develop so that
meaningful allocations can be determined. However, management believes that
the loan portfolio is well diversified and well secured, without undue
concentration in any specific risk area. Control of the loan quality is
continually monitored by management and is reviewed by the Board of Directors
and its Credit Committee on a monthly basis. Independent external review of
the loan portfolio is provided by the examinations conducted by regulatory
authorities, independent public accountants in conjunction with their annual
audit, and an independent loan review performed by an entity engaged by the
Board of Directors. The amount of additions to the allowance for possible loan
losses which are charged to earnings through the provision for possible loan
losses are determined based on a variety of factors, including actual
charge-offs during the year, historical loss experience, delinquent loans, and
an evaluation of current and prospective economic conditions in the market
area. Management believes the allowance for possible loan losses is adequate
to cover any potential losses.

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MATTERS OF GENERAL APPLICABILITY TO BANKS

COMPETITION

North Shore, Lake Forest, Hinsdale and Libertyville (collectively, the
"Holding Companies") compete in the commercial banking industry through their
subsidiaries, North Shore Bank, Lake Forest Bank, Hinsdale Bank and Libertyville
Bank (collectively, the "Banks"). The commercial banking industry is highly
competitive, and the Banks face strong direct competition for deposits, loans,
and other financial-related services. The Banks compete directly in Cook,
DuPage and Lake counties with other commercial banks, thrifts, credit unions,
stockbrokers, and the finance divisions of automobile companies. Some of these
competitors are local, while others are statewide or nationwide. The Banks have
developed a community banking and marketing strategy. In keeping with this
strategy, the Banks provide highly personalized and responsive service unique to
locally-owned and managed institutions. As such, the Banks compete for deposits
principally by offering depositors a variety of deposit programs, convenient
office locations, hours and other services, and for loan originations primarily
through the interest rates and loan fees they charge, the efficiency and quality
of services they provide to borrowers and the variety of their loan products.
Some of the financial institutions and financial services organizations with
which the Banks compete are not subject to the same degree of regulation as that
imposed on bank holding companies and Illinois banking corporations. In
addition, the larger banking organizations have significantly greater resources
than those that will be available to the Banks. As a result, such competitors
have advantages over the Banks in providing certain non-deposit services.
Currently, major competitors in certain of the Banks' markets include banking
subsidiaries of Harris Bankcorp, Inc., Northern Trust Corporation, and First
Chicago/NBD Corp. For a description of the competition relating to Crabtree
Capital Corporation, see "Competition" under "CRABTREE CAPITAL CORPORATION."

LITIGATION

The Holding Companies and their subsidiaries from time to time are
subject to pending and threatened legal action and proceedings arising in the
normal course of business. Since the Banks act as depositories of funds, they
are named as defendants in various lawsuits (such as garnishments proceedings)
involving claims to the ownership of funds in particular accounts. All such
litigation is incidental to each Bank's business. After reviewing these
actions and all other pending or threatened actions and proceedings with
counsel, based upon information currently available to management, management
of each of the Companies has informed Wintrust that it considers the outcome of
such actions or proceedings will not have a material adverse effect on the
operations or financial condition of such Company or its subsidiary(ies).

SUPERVISION AND REGULATION

Bank holding companies and banks are extensively regulated under
federal and state law. References under this heading to applicable statutes or
regulations are brief summaries of portions thereof which do not purport to be
complete and which are qualified in their entirety by reference to those
statutes and regulations. Any change in applicable laws or regulations may
have a material adverse effect on the business of commercial banks and bank
holding companies, including the Holding Companies and the Banks.

BANK HOLDING COMPANY REGULATION

The Holding Companies are registered as "bank holding companies" with
the Board of Governors of the Federal Reserve System (the "Federal Reserve
Board") and, accordingly, are subject to supervision by the Federal Reserve
Board under the Bank Holding Company Act of 1956, as amended, and the
regulations issued thereunder (collectively, the "BHC Act"). The Holding
Companies are required to file with the Federal Reserve Board periodic reports
and such additional information as the Federal Reserve Board may require
pursuant to the BHC Act. The Federal Reserve Board examines the Holding
Companies and may examine the Banks.

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The BHC Act requires prior Federal Reserve Board approval for, among
other things, the acquisition by a bank holding company of direct or indirect
ownership or control of more than 5% of the voting shares or substantially all
the assets of any bank or bank holding company, or for a merger or
consolidation of a bank holding company with another bank holding company.
With certain exceptions, the BHC Act prohibits a bank holding company from
acquiring direct or indirect ownership or control of voting shares of any
company which is not a bank or bank holding company and from engaging directly
or indirectly in any activity other than banking or managing or controlling
banks or performing services for its authorized subsidiaries. A bank holding
company may, however, engage in or acquire an interest in a company that
engages in activities which the Federal Reserve Board has determined by
regulation or order to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto, such as owning and
operating the premium finance business conducted by Crabtree. Under the BHC
Act and Federal Reserve Board regulations, the Holding Companies and the Banks
are prohibited from engaging in certain tie-in arrangements in connection with
an extension of credit, lease, sale of property, or furnishing of services.

Any person, including associates and affiliates of and groups acting
in concert with such person, who purchases or subscribes for 5% or more of the
Holding Companies' Common Stock may be required to obtain prior approval of the
Illinois Commissioner and the Federal Reserve Board. Under the Illinois
Banking Act, any person who thereafter acquires stock of the Holding Companies
such that its interest exceeds 10% of the Holding Companies, may be required to
obtain the prior approval of the Illinois Commissioner and under the Change in
Bank Control Act, after the Holding Companies and the Banks commence
operations, a person may be required to obtain the prior regulatory approval of
the FDIC and the Federal Reserve Board before acquiring the power to directly
or indirectly direct the management, operations or policies of the Holding
Companies or the Banks or before acquiring control of 25% or more of any class
of the Holding Companies' or Banks' outstanding voting stock. In addition, any
corporation, partnership, trust or organized group that acquires a controlling
interest in the Holding Companies or the Banks may have to obtain approval of
the Federal Reserve Board to become a bank holding company and thereafter be
subject to regulation as such.

It is the policy of the Federal Reserve Board that the Holding
Companies are expected to act as a source of financial strength to the Banks
and to commit resources to support the Banks. The Federal Reserve Board takes
the position that in implementing this policy, it may require the Holding
Companies to provide such support when the Holding Companies otherwise would
not consider themselves able to do so.

The Federal Reserve Board has adopted risk-based capital requirements
for assessing bank holding company capital adequacy. These standards revised
the definition of capital and established minimum capital standards in relation
to assets and off-balance sheet exposures, as adjusted for credit risks. The
Federal Reserve Board's risk-based guidelines apply on a consolidated basis for
bank holding companies with consolidated assets of $150 million or more and on
a "bank-only" basis for bank holding companies with consolidated assets of less
than $150 million, subject to certain terms and conditions. Under the Federal
Reserve Board's risk-based guidelines, capital is classified into two
categories. For bank holding companies, Tier I or "core" capital consists of
common shareholders' equity, perpetual preferred stock (subject to certain
limitations) and minority interests in the common equity accounts of
consolidated subsidiaries, and is reduced by goodwill, certain other intangible
assets and certain investments in other corporations ("Tier I Capital"). Tier
2 capital consists of the allowance for loan and lease losses (subject to
certain conditions and limitations), perpetual preferred stock, "hybrid capital
instruments," perpetual debt and mandatory convertible debt securities, and
term subordinated debt and intermediate-term preferred stock.

Under the Federal Reserve Board's capital guidelines, bank holding
companies are required to maintain a minimum ratio of qualifying capital to
risk-weighted assets of 8%, of which at least 4% must be in the form of Tier I
Capital. The Federal Reserve Board also requires a minimum leverage ratio of
Tier I Capital to total assets of 3%, except that bank holding companies not
rated in the highest category under the regulatory rating system are required
to maintain a leverage ratio of 1% to 2% above such minimum. The 3% Tier I
Capital to total assets ratio constitutes the minimum leverage standard for
bank holding companies, and will be used in conjunction with the

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risk-based ratio in determining the overall capital adequacy of banking
organizations. In addition, the Federal Reserve Board continues to consider
the Tier I leverage ratio in evaluating proposals for expansion or new
activities.

In its capital adequacy guidelines, the Federal Reserve Board
emphasizes that the foregoing standards are supervisory minimums and that
banking organizations generally are expected to operate well above the minimum
ratios. These guidelines also provide that banking organizations experiencing
internal growth or making acquisitions will be expected to maintain strong
capital positions substantially above the minimum levels.

As of March 31, 1996, on a pro forma combined basis, the Holding
Companies had regulatory capital in excess of the Federal Reserve's minimum
requirements. On a pro forma combined basis, Wintrust would have had a total
risk-based capital ratio of 11.3% and a leverage ratio of 8.0% as of March 31,
1996.

In August, 1995, the Federal Reserve Board, the FDIC and other federal
banking agencies published a final rule modifying their existing risk-based
capital standards to provide for consideration of interest rate risk when
assessing the capital adequacy of a bank. Under the final rule, the Federal
Reserve Board and the FDIC must explicitly include a bank's exposure to
declines in the economic value of its capital due to changes in interest rates
as a factor in evaluating a bank's capital adequacy. The Federal Reserve
Board, the FDIC and other federal banking agencies also published a joint
policy statement for public comment that describes the process the banking
agencies will use to measure and assess the exposure of a bank's net economic
value to change in interest rates. Under the policy, the federal regulators
will consider results of supervisory and internal interest rate risk models as
one factor in evaluating capital adequacy. At a future date the Federal
Reserve Board, the FDIC and other federal regulators intend to incorporate
explicit minimum requirements for interest rate risk in their respective
risk-based capital standards through the use of the model developed from the
policy statement and proposed rules.

BANK REGULATION

Under Illinois law, the Banks are subject to supervision and
examination by the Illinois Commissioner. As affiliates of the Banks, the
Holding Companies are also subject to examination by the Illinois Commissioner.

The deposits of the Banks are insured by the Bank Insurance Fund under
the provisions of the Federal Deposit Insurance Act (the "FDIA") and the Banks
are, therefore, also subject to supervision and examination by the FDIC. The
FDIA requires that the appropriate federal regulatory authority (the FDIC in
the case of the Banks) approve any merger and/or consolidation by or with an
insured bank, as well as the establishment or relocation of any bank or branch
office. The FDIC also supervises compliance with the provisions of federal law
and regulations which place restrictions on loans by FDIC-insured banks to
their directors, executive officers and other controlling persons.

Furthermore, banks are affected by the credit policies of other
monetary authorities, including the Federal Reserve Board, which regulate the
national supply of bank credit. Such regulation influences overall growth of
bank loans, investments, and deposits and may also affect interest rates
charged on loans and paid on deposits. The monetary policies of the Federal
Reserve Board have had a significant effect on the operating results of
commercial banks in the past and are expected to continue to do so in the
future.

All banks located in Illinois have traditionally been restricted as to
the number and geographic location of branches which they may establish. The
Illinois Banking Act was amended in June, 1993, however, to eliminate such
branching restrictions. Accordingly, banks located in Illinois are now
permitted to establish branches anywhere in Illinois without regard to the
location of other banks' main offices or the number of branches previously
maintained by the bank establishing the branch.

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FINANCIAL INSTITUTION REGULATION GENERALLY

Transactions with Affiliates. Transactions between a bank and its
holding company or other affiliates are subject to various restrictions imposed
by state and federal regulatory agencies. Such transactions include loans and
other extensions of credit, purchases of securities and other assets, and
payments of fees or other distributions. In general, these restrictions limit
the amount of transactions between an institution and an affiliate of such
institution, as well as the aggregate amount of transactions between an
institution and all of its affiliates, and require transactions with affiliates
to be on terms comparable to those for transactions with unaffiliated entities.

Dividend Limitations. Federal and state statutes and regulations
impose restrictions on the payment of dividends by the Holding Companies and
the Banks.

Federal Reserve Board policy provides that a bank holding company
should not pay dividends unless (i) the bank holding company's net income over
the prior year is sufficient to fully fund the dividends and (ii) the
prospective rate of earnings retention appears consistent with the capital
needs, asset quality and overall financial condition of the bank holding
company and its subsidiaries.

In addition, Illinois law places certain limitations on the ability of
the Holding Companies to pay dividends. For example, the Holding Companies may
not pay dividends to its shareholders if, after giving effect to the dividend,
the Holding Companies would not be able to pay their debts as they become due.
Since a major source of the Holding Companies' revenue is dividends the Holding
Companies receive and expect to receive from the Banks, the Holding Companies'
ability to pay dividends is likely to be dependent on the amount of dividends
paid by the Banks. No assurance can be given that the Banks will, in any
circumstances, pay dividends on their stock. As Illinois state-chartered
banks, none of the Banks may pay dividends in an amount greater than its
current net profits after deducting losses and bad debts out of undivided
profits provided that its surplus equals or exceeds its capital. For the
purpose of determining the amount of dividends that an Illinois bank may pay,
bad debts are defined as debts upon which interest is past due and unpaid for a
period of six months or more unless such debts are well-secured and in the
process of collection.

Financial Management Requirements. On December 19, 1991, the Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") was enacted
into law. Among other things, FDICIA requires federal banking regulators to
adopt safety and soundness standards for depository institutions and their
holding companies on matters such as internal controls, loan documentation,
credit underwriting, interest rate risk exposure, asset growth, and
compensation and other benefits, as well as standards specifying maximum
classified assets to capital ratios, minimum earnings sufficient to absorb
losses without impairing capital, and to the extent feasible, a minimum ratio
of market value to book value for publicly traded shares of depository
institutions and holding companies. FDICIA also requires depository
institutions to be examined annually by the banking regulators, and those
depository institutions having $500 million or more in total assets are
required to have an annual independent audit of financial statements performed
by independent public accountants, to establish an independent audit committee
comprised solely of outside directors, and to file annual management reports
with banking regulators which include an assessment of the effectiveness of the
institution's internal control structure and procedures and compliance with
laws and regulations relating to safety and soundness.

A range of other provisions in FDICIA include requirements applicable
to closure of branches; additional disclosures to depositors with respect to
terms and interest rates applicable to deposit accounts; uniform regulations
for extensions of credit secured by real estate; restrictions on activities of
and investments by state-chartered banks; modification of accounting standards
to conform to generally accepted accounting principles including the reporting
of off-balance sheet items and supplemental disclosure of estimated fair market
value of assets and liabilities in financial statements filed with the banking
regulators; increased penalties in making or failing to file assessment reports
with the FDIC; greater restrictions on extensions of credit to directors,
officers and principal shareholders; and increased reporting requirements on
agricultural loans and loans to small businesses.

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148

Prompt Corrective Action. FDICIA requires the federal banking
regulators, including the Federal Reserve Board and the FDIC, to take prompt
corrective action with respect to depository institutions that fall below
certain capital standards and prohibits any depository institution from making
any capital distribution that would cause it to be undercapitalized.
Institutions that are not adequately capitalized may be subject to a variety of
supervisory actions including, but not limited to, restrictions on growth,
investment activities, capital distributions and affiliate transactions and
will be required to submit a capital restoration plan which, to be accepted by
the regulators, must be guaranteed in part by any company having control of the
institution (such as the Company). Only well-capitalized institutions and
adequately capitalized institutions receiving a waiver from the FDIC are
permitted to accept brokered deposits, and only those institutions eligible to
accept brokered deposits may provide pass-through deposit insurance for
participants in employee benefit plans. In other respects, FDICIA provides for
enhanced supervisory authority, including greater authority for the appointment
of a conservator or receiver for under-capitalized institutions.

As of the date of this Joint Proxy Statement/Prospectus, not all the
regulations necessary to implement FDICIA have been adopted by the applicable
federal regulators. The precise terms and timing of the final regulations
cannot be predicted by the Holding Companies and the Banks; therefore, the
Holding Companies and the Banks are unable to determine the effect such
regulations will have on their respective financial conditions and operations.

Insurance of Deposit Accounts. Under FDICIA, as an FDIC-insured
institution, each of the Banks is required to pay deposit insurance premiums
based on the risk it poses to the insurance fund. The FDIC recently amended
the risk-based assessment system and on December 11, 1995, adopted a new
assessment rate schedule for BIF insured deposits. The new assessment rate
schedule, effective with respect to the semiannual premium assessment beginning
January 1, 1996, provides for an assessment range of zero to .27% (subject to a
$2,000 minimum) of deposits depending on capital and supervisory factors. Each
depository institution is assigned to one of three capital groups: "well
capitalized," "adequately capitalized" or "less than adequately capitalized."
Within each capital group, institutions are assigned to one of three
supervisory subgroups: "healthy," "supervisory concern" or "substantial
supervisory concern." Accordingly, there are nine combinations of capital
groups and supervisory subgroups to which varying assessment rates would be
applicable. An institution's assessment rate depends on the capital category
and supervisory category to which it is assigned.

During the first six months of 1996, the Banks were assessed at an
average rate of the statutory minimum of $2,000. Deposit insurance may be
terminated by the FDIC upon a finding that an institution has engaged in unsafe
or unsound practices, is in an unsafe or unsound condition to continue
operations or has violated any applicable law, regulation, rule, order or
condition imposed by the FDIC. The management of each of the Banks does not
know any practice, condition or violation that might lead to termination of
deposit insurance.

Legislative proposals to combine the Savings Association Insurance
Fund and the Bank Insurance Fund pending in Congress as of the date of this
Joint Proxy Statement/Prospectus, however, could further alter the FDIC's
proposed insurance assessment schedule. The effect of such legislative
proposals cannot be accurately predicted at this time.

Federal Reserve System. The Banks are subject to Federal Reserve
Board regulations requiring depository institutions to maintain
noninterest-earning reserves against their transaction accounts (primarily NOW
and regular checking accounts). The Federal Reserve Board regulations
generally require 3% reserves on the first $51.9 million of transaction
accounts and $1.6 million plus 10% on the remainder. The first $4.0 million of
otherwise reservable balances (subject to adjustments by the Federal Reserve
Board) are exempted from the reserve requirements. The Banks are in compliance
with the foregoing requirements.

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Community Reinvestment. Under the Community Reinvestment Act ("CRA"),
a financial institution has a continuing and affirmative obligation, consistent
with the safe and sound operation of such institution, to help meet the credit
needs of its entire community, including low- and moderate-income
neighborhoods. The CRA does not establish specific lending requirements or
programs for financial institutions nor does it limit an institution's
discretion to develop the types of products and services that it believes are
best suited to its particular community, consistent with the CRA. The CRA
requires each federal banking agency, in connection with its examination of a
financial institution, to assess and assign one of four ratings to the
institution's record of meeting the credit needs of its community and to take
such record into account in its evaluation of certain applications by the
institution, including applications for charters, branches and other deposit
facilities, relocations, mergers, consolidations, acquisitions of assets or
assumptions of liabilities, and savings and loan holding company acquisitions.
The CRA also requires that all institutions make public disclosure of their CRA
ratings. Each of the Banks received "satisfactory" ratings from the FDIC on
their most recent CRA performance evaluations.

Brokered Deposits. Well-capitalized institutions are not subject to
limitations on brokered deposits, while an adequately capitalized institution
is able to accept, renew or rollover brokered deposits only with a waiver from
the FDIC and subject to certain restrictions on the yield paid on such
deposits. Undercapitalized institutions are not permitted to accept brokered
deposits. [None of the Banks currently intends to seek brokered deposits,
although they are eligible under the statutory standard to do so.]

Enforcement Actions. Federal and state statutes and regulations
provide financial institution regulatory agencies with great flexibility to
undertake enforcement action against an institution that fails to comply with
regulatory requirements, particularly capital requirements. Possible
enforcement actions range from the imposition of a capital plan and capital
directive to receivership, conservatorship or the termination of deposit
insurance.

Interstate Banking and Branching Legislation. On September 29, 1994,
the Riegle-Neal Interstate Banking and Efficiency Act of 1994 (the "Interstate
Banking Act") was enacted. Under the Interstate Banking Act, adequately
capitalized and adequately managed bank holding companies will be allowed to
acquire banks across state lines subject to certain limitations. In addition,
under the Interstate Banking Act, beginning on June 1, 1997, banks will be
permitted to merge with one another across state lines and thereby create a
main bank with branches in separate states. After establishing branches in a
state through an interstate merger transaction, Libertyville Bank could
establish and acquire additional branches at any location in the state where
any bank involved in the interstate merger could have established or acquired
branches under applicable federal and state law.

Under the Interstate Banking Act, states may adopt legislation
permitting interstate mergers before June 1, 1997. Alternatively, states may
adopt legislation before June 1, 1997, subject to certain conditions, opting
out of interstate branching. Illinois adopted legislation, effective September
29, 1995, permitting interstate mergers beginning on June 1, 1997. It is
anticipated that this interstate merger and branching ability will increase
competition and further consolidate the financial institutions industry.

MONETARY POLICY AND ECONOMIC CONDITIONS

The earnings of banks and bank holding companies are affected by
general economic conditions and also by the fiscal and monetary policies of
federal regulatory agencies, including the Federal Reserve. Through open
market transactions, variations in the discount rate and the establishment of
reserve requirements, the Federal Reserve exerts considerable influence over
the cost and availability of funds obtainable for lending or investing.

The above monetary and fiscal policies and resulting changes in
interest rates have affected the operating results of all commercial banks in
the past and are expected to do so in the future. The Holding Companies cannot
fully predict the nature or the extent of any effects which fiscal or monetary
policies may have on their business and earnings.

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CRABTREE CAPITAL CORPORATION

BUSINESS

General. Crabtree Capital Corporation is a financial services holding
company engaged primarily in the business of financing the payment of insurance
premiums through its majority-owned subsidiary, First Premium. Crabtree has no
other operating subsidiaries but does have some residual business from former
subsidiaries which have either been liquidated or sold. This non-operating
business involves primarily the run-off of a small amount of lease receivables
and the settlement of certain litigation and contingency issues incurred by a
former insurance holding company's subsidiary.

Crabtree was organized on September 10, 1979 and adopted its present
name on August 12, 1985. Crabtree was inactive until late 1985 when it
purchased a property and casualty insurance company, Addison Farmers' Insurance
Company. Crabtree subsequently purchased a controlling interest in a credit
life insurance holding company, Credit Life, and organized four new companies,
Spring Financial Services, Inc., a commercial finance company; Prospect Leasing
Company, a leasing company ("Prospect"); and two insurance premium finance
companies, First Premium and Crabtree Premium Finance Company.

Crabtree subsequently sold Addison Farmers' Insurance Company in 1990,
Spring Financial Services, Inc. in 1991, and Crabtree Premium Finance Company
in 1992. In 1992, Prospect sold approximately 90% of its leasing portfolio.
Most of Prospect's income since 1992 has come from run-off of its retained
lease portfolio. In 1995, Crabtree effectively bought out the remaining
minority shareholders in Credit Life by having Credit Life repurchase all of
its common stock held by the minority shareholders. During 1996, Prospect will
merge with and into Crabtree, and Credit Life will merge with and into First
Premium.

Credit Life has no current operations, but has certain unresolved
outstanding litigation and contingency issues from prior years. All of these
issues are immaterial with the exception of a lawsuit which Credit Life has
against a former agent. The suit is intended to enable Credit Life to recover
losses incurred by a subsidiary relative to an unauthorized transaction by the
agent which resulted in a loss of approximately $4 million by the subsidiary.

Credit Life also has tax net operating loss carryforwards of
approximately $10.1 million as of December 31, 1995. As the result of Crabtree
becoming a 100% owner of Credit Life, and Credit Life merging with First
Premium in 1996, certain of these tax loss carryforwards may be utilized by
First Premium in future years.

First Premium is a financial services company engaged in the business
of financing the payment of insurance premiums. The company offers financing
of approximately 80% of an insurance premium to individuals and commercial
purchasers of property and casualty and liability insurance who wish to pay
their insurance premiums on an installment basis. Whereas many insurance
carriers require advance payment of a full year's premium, the company allows
the insured to spread the cost of the insurance policy over time.

First Premium finances insurance premiums without assuming the risk of
loss borne by insurance carriers. When the insured buys an insurance policy
from an independent insurance agent or broker who offers financing through the
company, the insured generally pays a down payment of approximately 15% to 25%
of the total premium and signs a premium finance agreement for the balance due.
Under the terms of the company's standard form of financing contract, the
company is given the power to cancel the insurance policy if there is a default
in the payment on the finance contract and to collect the unearned portion of
the premium from the insurance carrier, which secures payment of the balance
due under the financing contract. The down payment is set at a level designed
such that, in the event of cancellation of a policy, the return premium from
the insurance carrier is sufficient to cover the loan balance plus interest and
other charges due to the company. The company derives profit to the extent
that interest earned and fees charged generate income exceeding the interest
expense for borrowed funds and the company's selling and operating expenses.

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First Premium is licensed or otherwise qualified to do business as an
insurance premium finance company in 38 states. Virtually all of the company's
outstanding receivables are commercial accounts. At December 31, 1995, the
company had approximately 11,000 active accounts.

To finance its insurance premium loans, the company has in the past
relied primarily on proceeds of loan sales to First Premium Financing Corp.
(FPFC), a wholly-owned special-purpose corporation. FPFC sells loans acquired
from the company to an independent multi-seller conduit, which issues
commercial paper to finance the acquisition of the loans. To a lesser degree,
loans are financed by short term lines of credit and subordinated debt.

The company's marketing strategy is based on establishing and
maintaining relationships with insurance agents by offering a high degree of
service and innovative products. Senior management is directly involved in the
company's marketing efforts which currently focus on commercial accounts. The
company believes that these accounts provide higher returns at lower risk than
other sectors of the marketplace.

Industry Background. Premium finance companies are licensed to
finance property, casualty and liability insurance premiums for corporate and
individual insureds that are unable or do not wish to pay an entire insurance
premium in one lump sum. The insured may be able to finance a premium with an
affiliated company of the insurance carrier, if any, an independent premium
finance company such as the company, or a bank or other lending institution.
Customarily, insurance agents utilize the services of premium finance companies
to assist in the sale of an insurance policy to their customers. Upon the
execution of a finance agreement with the insured, the agent forwards the
completed documents and the down payment to the premium finance company. The
premium finance company then pays the premium in full to the insurance carrier
or its agent. The premium finance company collects principal and interest from
the insured (borrower) in the form of an installment payment. In the event the
insured (borrower) defaults, the company has the right to cancel the insurance
policy by mailing a notice of cancellation to the insurance carrier. The
insurance carrier is then required by state law to refund the gross unearned
premium in full to the finance company for the benefit of the insured, and the
finance company applies the proceeds there of against the balance due from the
insured, and the finance company applies the proceeds thereof against the
balance due from the insured.

Insurance Premium Financing Services. The company offers financing to
qualified purchasers of various types of insurance policies, including coverage
for property, casualty and liability insurance, of up to approximately 75% to
85% of the entire premium for such policies. The company's standard form of
premium finance agreement discloses to the insured, among other things, the
price of the total premium; the amount of the cash down payment made; the
amount financed; the amount of the finance charge; the aggregate amount which
will have been paid after the insured has made all payments as scheduled; the
applicable annual percentage rate charged; that a late charge of 5% of the
payment is due in the event a payment is more than five days late (or such
lesser amount as may be provided by the appropriate state law); the insured's
entitlement to a refund of part of the finance charge in the event of
prepayment; that the insured is granting to the company a security interest in
any and all unearned return premiums which may become payable under the policy;
and that the insured is appointing the company as the insured's
attorney-in-fact with all authority to cancel the policy and to receive from
the insurance carrier the unearned portion of the premium. The company's
agreements generally provide for monthly payments over a period of nine months
on a one-year policy.

Each insurance broker in the company's referral network is provided
with financing forms and/or quoting software. When an insured seeks premium
financing, the broker completes (and has the insured sign) the company's form
of premium finance agreement and collects a down payment of approximately 15%
to 25% of the total premium. The broker also signs the contract to certify
that the insurance policy has been issued and delivered. The broker submits
the original and one copy of the executed premium finance agreement to the
company, together with the down payment. Upon acceptance of the finance
contract, the company remits payment for the amount financed to the insurance
carrier or its agent. The company inputs all information into its computer
system and sends a copy to the insured. The first payment is due approximately
30 days from the effective date of coverage. The company gives notice to the
carrier of its interest in the policy and informs the carrier that any return
premiums must be sent to the company in the event of cancellation of the
policy.

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Although the insured is primarily liable on his or its finance
contract, the company does not look solely to the borrower's credit-worthiness
for payment. Rather, the insured assigns to the company his or its interest in
any unearned premiums relating to the financed insurance policy as security for
the loan and grants to the company the power to cancel the insurance policy,
and collect the unearned premium, if there is a default in payment on the
finance contract. Thus, the unearned premiums held by the insurance company
provide a collateral source of payment on a delinquent finance contract.

The company endeavors to increase revenues by using its resources to
finance as many premiums profitably as is practical. From the inception of the
Company's operations through December 31, 1995, the company has accepted 49,257
premium finance loans covering approximately 100,000 insurance policies. The
company currently does business with over 600 insurance agents and brokers.
The average individual loan the company has accepted is approximately $15,600.

In order to minimize losses, the company will not finance premiums
unless the insurance policy provides for the return of unearned premiums
connected therewith upon cancellation. The company generally requires
policyholders to make a loan payment sufficient to ensure that at all times the
unearned premium available for refund will pay the loan balance plus interest
and other charges. Advance payment of approximately 15% to 25% of the premium
generally ensures such margin.

The company has the power to cancel an insurance policy if payments
due to it from the insured are more than approximately 20 days late (the number
of days varies by state law). After a payment is approximately 10 days late,
the company mails a late notice to the insured and charges the insured a late
charge of 5% of the installment due (or lesser amount as provided by state
law). If payment is not received within 10 days thereafter, the company has
the right to cancel the policy by sending a notice of cancellation of the
policy to the insurance company with a copy to both the insured and the
insurance agent or broker. The financing agreement is structured so that the
insured will already have paid for insurance coverage for a period of time
extending beyond such 20-day period.

Any monies paid for insurance coverage for time extending after the
cancellation date constitute "unearned premium" and must, under applicable
state statutes, be refunded to the insured. The company's form of premium
finance agreement provides that all such refunds be remitted by the insurance
carrier to the company on behalf of the insured. Before it forwards the refund
to the insured (or to the broker on behalf of the insured where state
regulations require), the company deducts all interest, service and late
charges due to it. In the company's experience, the time periods between the
cancellation date and receipt of the refund of unearned premiums has averaged
between 60 and 120 days. There can be no assurances, however, that the company
will not experience increasing delays in collecting, or inability to collect,
such refunds in the future.

Upon receipt of the gross return or unearned premium from the
insurance carrier, and the crediting of this return to the insured's account,
debit balances might still be reflected in certain instances. The causes of
such a situation include improper disclosure of information to insurance agents
on the insured's application for insurance, special payment terms offered by
the company which did not provide full collateralization of the loan, or
clerical errors by company personnel. The company uses its in-house collection
capability in an attempt to collect such balances. If in-house efforts are
unsuccessful, the use of external collection attorneys is initiated. Certain
transactions are written with recourse against the producing agent, broker or
agency and/or offsetting reserves to a few selected insurance producers.

Sales and Marketing. The company generates business through sales
representatives, who solicit premium loans from independent insurance agents
and brokers. As of the end of 1995, the company employed 10 such sales
representatives. Independent agents and brokers are associated with various
insurance companies. Insurance brokers may refer financing business to an
insurance premium financing company because such companies can assist them in
servicing their clients, particularly where the insurance carrier does not
offer an installment payment option. Since the company has no contracts with
any brokers to continue to refer business to the company, there can be no
assurance that brokers presently directing financing business to the company
will continue to do so or that the company will be able to locate and establish
relationships with additional brokers.

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The company believes that it offers more flexibility with regard to
late payments and policy cancellations than affiliated companies of insurance
carriers, banks and other lending institutions which generally subject a policy
to automatic cancellation on a designated date if a premium payment is late.
It is the company's policy to notify the broker immediately when any payment is
past due, thereby allowing the broker to arrange with the insured for payment
and to prevent cancellation of the policy. Under certain circumstances the
grace period can be extended, thereby avoiding cancellation of the policy and
the loss of part of the broker's commission which may result from such
cancellation. No assurances can be given that the affiliated companies of the
insurance carriers, banks and other lending institutions will not add greater
flexibility to their insurance financing business practices and, in the event
this should occur, there may be a material adverse effect on the company's
business operations.

Regulation. The operations of the company's subsidiary, First
Premium, are regulated by state statutes, and regulations promulgated
thereunder, which provide for the licensing, administration and supervision of
premium finance companies. Such statutes and regulations impose significant
restrictions on the operation of First Premium's business.

First Premium is currently licensed or otherwise qualified to do
business as an insurance premium finance company in 38 states. Generally, it
must renew its license to operate as a premium finance company each year in
each state. First Premium is also subject to periodic examinations and
investigations by state regulators.

Among other things, certain state statutes and regulations impose
minimum capital requirements, govern the form and content of financing
agreements, limit the interest and service charges First Premium may impose,
prescribe notice periods prior to the cancellation of policies for non-payment,
limit delinquency and collection charges and govern the procedure for
cancellation of policies and collection of unearned premiums. Changes in the
regulation of First Premium's activities, such as increased rate regulation,
could have an adverse effect on First Premium's operations. The statutes do
not provide for automatic adjustments in the rates a premium finance company
may charge. Consequently, during periods of high prevailing interest rates on
institutional indebtedness and fixed statutory ceilings on rates First Premium
may charge its insureds, First Premium's ability to operate profitably could be
adversely affected.

Competition. First Premium encounters intense competition from
numerous other firms, including a number of national commercial premium finance
companies, companies affiliated with insurance carriers, independent insurance
brokers who offer premium finance services, banks and other lending
institutions. Some of First Premium's competitors are larger and have greater
financial and other resources and are better known than First Premium. In
addition, there are few, if any, barriers to entry into this industry in the
event other firms, particularly insurance carriers and their affiliates, seek
to compete in this market.

The market for premium finance companies is three-tiered. The first
tier is that of national companies that are owned by insurance companies,
banks, and commercial finance companies. In this group are five companies that
on a combined basis finance over $9 billion per annum of premium finance
agreements. The second tier is a group of five to ten regional companies
financing $200-800 million each per year. The third tier is comprised of
smaller local companies and is highly fragmented. First Premium is the size of
the second tier companies but competes mainly with the first tier companies.

First Premium believes that it offers better service and more
flexibility with regard to late payments and policy cancellations than
affiliates of insurance carriers, banks and other lending institutions. First
Premium competes with these entities by emphasizing a high level of knowledge
of the insurance industry, flexibility in structuring financing transactions,
and the timely purchase of qualifying contracts. First Premium believes that
its commitment to account service also distinguishes it from its competitors.
It is First Premium's policy to notify the insurance agent when an insured is
in default and to assist in collection, if requested by the agent. To the
extent that affiliates of insurance carriers, banks, and other lending
institutions add greater service and flexibility to their financing practices
in the future, the company's operations could be adversely affected. There can
be no assurance that First Premium will be able to continue to compete
successfully in its markets.

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Personnel. Crabtree has no full-time employees. First Premium's
staff consists of 44 employees (all of whom are full-time employees), including
5 executive officers, 10 sales and marketing representatives, and 29 clerical
and administrative employees.

Description of Property. Crabtree's offices are located at 475 N.
Martingale Rd., Suite 440, Schaumburg, Illinois 60173. The company leases
approximately 1100 square feet of office space at a cost of $2,000 per month
under a two-year lease expiring in the year 1997.

First Premium's offices are located at 520 Lake Cook Road, Suite 300,
Deerfield, Illinois 60015. The company leases approximately 12,000 square feet
of office space at a cost of $27,000 per month under a five-year lease expiring
in the year 2000.

MANAGEMENT OWNERSHIP OF COMMON STOCK

The following table sets forth information as of March 31, 1996, with
respect to beneficial ownership of shares of Crabtree held by (i) each director
of Crabtree, (ii) the executive officers of Crabtree and certain executive
officers of First Premium, and (ii) all directors and executive officers as a
group.

SHARES PRO
SUBJECT TOTAL FORMA
SHARES TO VESTED CRABTREE % OF % OF
COMMON SUBJECT TO STOCK BENEFICIAL CRABTREE WINTRUST
SHARES(1) WARRANTS(2) OPTIONS(3) OWNERSHIP TOTAL(4) TOTAL(4)(5)
---------- ------------- ------------ ----------- ---------- -----------

DIRECTORS
- ---------
Howard D. Adams(6)**. . . . . . 115,283 -- 7,858 123,141 11.92% 7.88%
Robert P. Knight . . . . . . . 25,000 -- 3,000 28,000 2.72% *
Emmett D. McCarthy (7) . . . . 56,484 -- -- 56,484 5.51% 4.90%
Tull Monsees . . . . . . . . . 40,800 -- -- 40,800 3.98% *
Larry Wright (8) . . . . . . . 60,700 63,053 -- 123,753 11.37% 7.72%
---------- ---------- --------- --------- --------
Total Directors . . . . . . . . 298,267 63,053 10,858 372,178 35.50%

NON-DIRECTOR EXECUTIVE OFFICERS
- -------------------------------
Frank J. Burke (2) . . . . . . -- -- 31,680 31,680 3.00% *
James Knollenberg (2) . . . . . -- -- 61,361 61,361 5.65% 1.22%
---------- ---------- --------- --------- --------
Total Directors and Executive
Officers as a group . . . . 298,267 63,053 103,899 465,219 44.15%
========== ========== ========= ========= ========
Total Common Share
Equivalents Outstanding . . 1,025,265 378,376 156,934 1,560,575
========== ========== ========= ========= ========

- ---------------
* Less than 1%.
** Denotes executive officer (in addition to director status).

(1) Includes shares held directly and, if applicable, indirectly through such
person's spouse, minor children, certain family trusts, IRA's or 401(k)
plans.

(2) Represents First Premium warrants presented as if they were converted into
warrants to acquire shares of Crabtree Common Stock, as contemplated by
the Reorganization Agreement. The Reorganization Agreement provides that
these warrants will convert into warrants to acquire 447,740 shares of
Wintrust Common Stock (assuming no prior exercise of such warrants).

(3) Reflects vested stock options to purchase shares of Crabtree Common
Stock. Also includes shares subject to vested stock options of First
Premium and of Credit Life as if they were converted into Crabtree options
as provided for in the Reorganization Agreement.

(4) Beneficial ownership percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.

(5) Assumes no exercise of outstanding options, rights or warrants other than
the anticipated exercise of certain First Premium warrants resulting in
399,612 additional shares of Wintrust Common Stock to be outstanding
immediately following the Effective Date of the Reorganization. Includes
shares deemed beneficially owned by such persons in any of the other
Companies, giving effect to the applicable Exchange Ratios and North Shore
Stock Split. Also gives effect to the cancellation of intercompany share
ownership as provided in the Reorganization Agreement.

(6) Includes 8,817 shares held in a family trust for the benefit of Mr. Adams'
son and 1,000 shares held in a charitable foundation with respect to all
of which Mr. Adams has voting power; Mr. Adams disclaims beneficial
ownership of such shares. Does not include 46,750 shares held in other
family trusts for the benefit of Mr. Adams' children for which Emmet D.
McCarthy serves as co-trustee, nor an additional 2,500 shares held
directly by Mr. Adams' children.

(7) Includes an aggregate of 46,750 shares held by the Alan W. Adams Family
Trust and Sarah Katherine Adams Family Trust for which Mr. McCarthy has
shared voting and investment power as co-trustee together with either Alan
W. Adams or Sarah K. Adams, respectively, adult children of Howard D.
Adams. Alan W. Adams is a Vice President of Lake Forest Bank and a
proposed director of Wintrust. Mr. McCarthy disclaims beneficial
ownership of all shares held in the Adams family trusts.

(8) In addition to 1,300 shares held by Mr. Wright, the beneficial ownership
shown includes (i) 500 shares held by an employee retirement plan of
Milbank Corporation of which Mr. Wright is a trustee and with respect to
which shares he has shared voting and investment power; (ii) 58,900 shares
held by Deerpath Investments LLP, a limited partnership ("Deerpath") to
which Milbank Corporation, of which Mr. Wright is an officer, director and
principal shareholder, serves as investment advisor and with respect to
which shares Mr. Wright has shared voting and investment power; and (iii)
63,053 shares which Deerpath will have the right to purchase pursuant to
the exercise of warrants assuming conversion of the outstanding First
Premium common stock warrants in accordance with the provisions of the
Reorganization Agreement.

(9) Mr. Knollenberg is President and a Director and Mr. Burke is an Executive
Vice President of First Premium, the primary subsidiary of Crabtree.

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BENEFICIAL OWNERSHIP OF CERTAIN SHAREHOLDERS

On March 31, 1996, Crabtree had 1,025,265 shares of common stock
outstanding. As of such date, the following persons not listed under
"Management Ownership of Common Stock" are known by Crabtree to be the owners
of or might be deemed to be the beneficial owners of more than 5% of its common
stock.

NUMBER OF SHARES PERCENT OF
NAME ADDRESS BENEFICIALLY OWNED CLASS
------------------------------ --------------------------- ----------------------------- --------------------

Internationale Netherlanden 135 East 57th Street 315,323 23.52%
Bank, N.V.(2) New York, NY

Milbank Corporation(3) 135 South LaSalle 124,453 11.44%
Chicago, IL

Electra Investment Trust, PLC 70 East 55th Street 63,830 6.22%
New York, NY

Bert A. Getz 3634 Civic Center Plaza 60,000 5.85%
Scottsdale, AZ

William H. Sherer(4) P.O. Box 1617 60,380 5.89%
Mercer Island, WA

- ----------------
(1) Beneficial ownership percentages are calculated in accordance with SEC
Rule 13d-3 promulgated under the Securities Exchange Act of 1934.

(2) Represents shares subject to First Premium warrants giving effect to the
conversion of such warrants into the right to acquire Crabtree shares as
required by the terms of the Reorganization Agreement.

(3) Includes (i) 1,300 shares held by Larry Wright, a director of Crabtree,
and 700 shares held by Robert D. Harnach, a director of Lake Forest and
Hinsdale, each of whom are officers, directors and principal
shareholders of Milbank Corporation ("Milbank"); (ii) 500 shares held by
an employee retirement plan of Milbank of which Mr. Wright and Mr.
Harnach are trustees with voting and investment power; and (iii) 58,900
shares held in Deerpath Investment LLP, a limited partnership
("Deerpath") to which Milbank serves an investment advisor and with
respect to which Mr. Wright and Mr. Harnach exercise shared voting and
investment power. Also includes 63,053 shares subject to purchase by
Deerpath pursuant to the exercise of warrants, assuming the conversion
of the outstanding First Premium common stock warrants as contemplated
by the Reorganization Agreement.

(4) Represents 48,280 shares held in a trust for the benefit of William H.
Sherer for which William H. Sherer is trustee; 2,500 shares held in a
trust for the benefit of William H. Sherer for which William C. Sherer
is trustee; 9,600 shares held in an irrevocable trust for the benefit of
William H. Sherer for which Patricia K. Sherer is trustee.

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SELECTED FINANCIAL DATA
CRABTREE CAPITAL CORPORATION

THREE MONTHS ENDED MARCH 31, YEARS ENDED DECEMBER 31,
----------------------------- ---------------------------------------------
1996 1995 1995 1994 1993 1992 1991
-------------- -------------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)

Revenues:
Finance charges . . . . . . . $ 394 $ 1,303 $ 2,547 $ 8,271 $ 4,423 $ 4,043 $11,370
Gain on sale of receivables . 967 1,616 4,421 -- -- -- --
Servicing and management fees 324 175 1,083 -- -- -- --
Other income . . . . . . . . . 29 4 1,068 564 318 707 2,796
Gain on sale of subs . . . . . -- -- -- -- -- -- 4,793
-------- -------- ------- ------- ------- ------- -------
Total revenues . . . . . . . 1,714 3,098 9,119 8,835 4,741 4,750 18,959
-------- -------- ------- ------- ------- ------- -------

Expenses:
Interest expense . . . . . . . 182 645 1,248 4,032 1,879 2,484 7,082
Provision for loan losses . . 42 89 347 137 887 934 1,445
Salaries and benefits . . . . 640 650 2,859 2,583 2,047 828 553
Other expense . . . . . . . . 880 841 2,766 2,802 2,709 4,955 9,635
-------- -------- ------- ------- ------- ------- -------
Total expenses . . . . . . . 1,744 2,225 7,220 9,554 7,522 9,201 18,715
-------- -------- ------- ------- ------- ------- -------

Income (loss) from continuing
operations
before income taxes . . . . . (30) 873 1,899 (719) (2,781) (4,451) 244
Income taxes . . . . . . . . . -- -- -- -- -- -- --
Income (loss) from continuing
-------- ------- ------- ------- ------- ------- -------
operations . . . . . . . . . . . (30) 873 1,899 (719) (2,781) (4,451) 244

Income (loss) from operations and
sale of discontinued subsidiaries -- (3) (17) (236) (193) 102 1,261
-------- ------- ------- ------- ------- ------- -------
Net income (loss) . . . . . . . . $ (30) $ 870 $ 1,882 $ (955) $(2,974) $(4,349) $ 1,505
======== ======= ======= ======= ======= ======= =======

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

RESULTS OF OPERATIONS

Crabtree derives its income from its three major subsidiaries: First
Premium, Credit Life, and Prospect. Crabtree has no significant recurring
income of its own, but has expenses which include salaries and professional
fees, operating expenses and interest on debt. Credit Life and Prospect have
been in various stages of liquidation since 1991, and thus a greater proportion
of the consolidated group's income each year is derived from First Premium.

In 1992, Prospect sold approximately 90% of its leasing portfolio.
Most of its income since that time has come from the run-off of its retained
lease portfolio. The majority of the income and expense of Credit Life since
1991, when it sold the last of its major operating subsidiaries, has been from
the proceeds and expense of various litigation and contractual proceedings
which have occurred as the result of the termination of their business
operations. Virtually no ongoing business operations have occurred since 1991.

First Premium derives its income from the origination, sale and
management of insurance premium finance receivables. First Premium sells the
majority of the premium finance receivables originated to a wholly-owned,
bankruptcy remote subsidiary, First Premium Financing Corporation. First
Premium Financing Corporation in turn sells the receivables to Holland Limited
Securitization, Inc., which is an independent, multi-seller conduit which
issues commercial paper or other indebtedness to fund the purchase of
receivables from First Premium Financing Corporation. All receivable sales to
Holland Limited Securitization, Inc. are without recourse. First Premium
recognizes a gain at the time of each sale based on the estimate of excess
servicing, as defined, to be earned over the life of the receivables sold.

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157

The following table sets forth the spread that First Premium has
maintained for the last three fiscal years and the three month periods ended
March 31, 1995 and 1996 based on average managed receivables.

THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED MARCH 31,
--------------------------------------------------- ----------------------------------
1993 1994 1995 1995 1996
----------------- ---------------- ---------------- ----------------- ----------------

Average Managed
Installment Loans
Receivable . . . . . . . . . $49,470,391 $85,912,066 $107,091,603 $98,746,588 $114,926,350
Interest Income (Spread) . . . 2,275,219 3,910,489 6,105,378 1,347,370 1,537,868
% of Spread of Avg. Loans
Receivable . . . . . . . . . 4.60 4.55 5.70 5.46 5.35

First Premium is presently licensed or otherwise qualified to do
business in 38 states. For the year ended December 31, 1995, 16% of its
receivables were originated in the state of Texas. No other single state
represented more than 10% of the premium finance receivables originated by
First Premium.

The following table sets forth certain income statement items of First
Premium as a percentage of First Premium's total revenues.

Revenues:
Premium finance charges earned . . 99.0% 99.1% 31.5% 41.5% 22.4%
Gain on sale of receivables . . . 0 0 55.0 52.8 58.2
Servicing and management fees . . 0 0 13.5 5.7 19.4
Interest income . . . . . . . . . 1.0 .9 0 0 0
----- ----- ----- ----- -----
Total Revenues . . . . . . . . 100.0% 100.0% 100.0% 100.0% 100.0%
===== ===== ===== ===== =====
Expenses:
Operating expenses . . . . . . . . 67.1% 51.4% 56.3% 39.9% 74.7%
Interest expense . . . . . . . . . 38.1 45.5 11.5 18.3 6.8
Provision for possible
credit losses . . . . . . . . . 3.1 .8 3.0 2.9 2.5
----- ----- ----- ----- -----
Total Expenses . . . . . . . . 108.3% 97.7% 70.8% 61.1% 84.0%
===== ===== ===== ===== =====
Income from operations before
provision for income taxes . . (8.3%) 2.3% 44.6% 38.9% 16.0%
Provision for income taxes . . . . -- -- -- -- --
----- ----- ----- ----- -----
Net income . . . . . . . . . . . . (8.3%) 2.3% 29.2% 38.9% 16.0%
===== ===== ===== ===== =====

First Premium records a general provision for possible losses on
finance receivables in such amounts as management deems appropriate.
Case-by-case direct write-offs, net of recoveries on finance receivables, are
charged to First Premium's allowance for possible losses. The amount of such
allowance is reviewed periodically in light of economic conditions, the status
of the outstanding finance receivables, and other factors.

First Premium loan losses are minimal since its premium finance
receivables are generally fully secured by unearned insurance premiums. If a
borrower defaults, First Premium seeks to obtain a refund of unearned premiums
from the insurance carriers.

First Premium bears the credit risk of collections from the insurance
carriers. Upon a carrier becoming insolvent and unable to pay claims to an
insured or refund unearned premiums upon cancellation of a policy to a finance
company, each state provides a state guaranty fund that will pay such refund,
less a per claim deductible in certain states. First Premium diversifies its
financing activities among a wide range of brokers and insurance carriers.

The following table sets forth information concerning First Premium's
allowance for possible credit losses on finance receivables and its loss
experience for the years ended December 31, 1993 through 1995 and for the three
month periods ended March 31, 1995 and 1996.

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158

THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED MARCH 31,
------------------------------------------- -----------------------------
1993 1994 1995 1995 1996
-------------- -------------- ------------- -------------- --------------

Allowance for possible losses at
beginning of year . . . . . . . $ 93,572 $225,102 $250,669 $250,669 $280,911
Provision for possible losses . . . 136,525 65,080 246,701 89,176 41,608
Charge-offs . . . . . . . . . . . . (7,091) (42,518) (246,534) (78,741) (44,382)
Amounts recovered . . . . . . . . . 2,096 3,005 30,075 7,147 3,006
-------- -------- -------- -------- --------
Allowance for possible losses at
end of year . . . . . . . . . . $225,102 $250,669 $280,911 $268,251 $281,143
======== ======== ======== ======== ========
Percentage of allowance for
possible losses to finance
receivables outstanding at
end of year . . . . . . . . . . .36% .27% .25% .23% .22%
======== ======== ======== ======== ========
Percentage of net losses to finance
receivables liquidated during
year . . . . . . . . . . . . . . .004% .02% .08% .10% .05%
======== ======== ======== ======== ========

Comparison of Results for Period Ended March 31, 1995 to Period Ended March 31,
1996

The consolidated net income of Crabtree decreased from net income of
$869,854 in the first three months of 1995 to a net loss of $30,380 in the
first three months of 1996. The net income by component is included in the
following table:

THREE MONTHS ENDED MARCH 31, INCREASE
------------------------------------------ (DECREASE)
1995 1996 IN INCOME
--------------------- -------------------- ------------

Crabtree income . . $ 8,681 $ 4,500 $ (4,181)
Crabtree expenses . (315,679) (306,277) 9,402
First Premium . . . 1,192,852 266,397 (926,455)
Prospect . . . . . (13,000) 5,000 18,000
Credit Life . . . . (3,000) -- 3,000
---------- ---------- ----------
$ 869,854 $ (30,380) $ (900,234)
========== ========== ==========

Crabtree's expenses decreased $9,402 or 3.0% from $315,679 for the
period ended March 31, 1995 to $306,277 for the period ended March 31, 1996.
The major component of the reduction was interest expense which decreased
$13,078 or 14.9% from 1995 to 1996 as the result of there being approximately
$300,000 less debt outstanding during the period. Occupancy expense decreased
$7,200 or 49.4% from 1995 to 1996 as the result of a move to smaller offices.
Legal fees also decreased $9,739 from 1995 to 1996. These decreases were
offset by an increase in insurance expense of $6,270 or 27.3% from 1995 to 1996
as the result of expanded insurance coverages.

First Premium's net income decreased by 77.7% from $1,192,852 in the
first three months of 1995 to $266,397 in the first three months of 1996.
Premium financing revenues decreased $901,244 or 70.8% from $1,273,000 in 1995
to $371,756 in 1996. This decrease resulted from a change in the structure of
the company's securitization facility in February of 1995 which dictated
different accounting treatment for loans sold to the securitization facility.
The new structure permitted the company to record gains on receivables sold at
the time of sale rather than recording the income over the life of the loan as
the company had done in prior years. A large one-time gain was recorded in
February of 1995 when loans were sold to the new facility. Gain on sale of
receivables decreased $649,000 or 40.2% from $1,616,000 in 1995 to $967,000 in
1996 as a result of the one-time gain. Total loans financed, net of finance
charges, decreased 1.7% to $75,125,000 in 1996 from $76,385,612 in 1995, and
the number of contracts represented decreased 3.2% to 4,241 in 1996 from 4,589
in 1995. First Premium's average managed receivables for the quarter ended
March 31, 1996 increased $16,179,162 or 16.4% from $98,746,588 in 1995 to
$114,926,350 in 1996. First Premium's total expenses decreased $474,267 or
25.4% from $1,870,469 in 1995 to $1,396,202 in 1996. The primary components of
this decrease involved interest expense primarily on

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159

commercial paper which decreased $454,833 or 81.1% from $559,658 in 1995 to
$104,825 in 1996. This decrease was the result of the change in the company's
securitization facility. The major increases in operating expenses involved
office and occupancy expenses which were attributable to an expansion of the
space occupied by First Premium in anticipation of future business growth.

Comparison of Results for Year Ended December 31, 1994 to Year Ended December
31, 1993

The net loss of Crabtree decreased from $2,974,403 in the year ended
December 31, 1993 to $955,060 in the year ended December 31, 1994. The net
loss by component is included in the following table:

YEAR ENDED DECEMBER 31, INCREASE
------------------------------------------ (DECREASE)
1993 1994 IN INCOME
--------------------- -------------------- ------------

Crabtree income . . $ 106,981 $ 373,013 $ 266,032
Crabtree expenses . (1,389,924) (1,183,459) 206,465
First Premium . . . (361,546) 190,386 551,932
Prospect . . . . . (761,000) (99,000) 662,000
Credit Life . . . . (568,914) (236,000) 332,914
----------- ----------- ----------
$(2,974,403) $ (955,060) $2,019,343
=========== =========== ==========

Crabtree's income increased $266,032 from 1993 to 1994. This increase
was primarily attributable to two major items in 1994 which were a gain on the
sale of certain fixed assets of approximately $112,000 and a gain from the
reduction of fees owed to a law firm which were previously fully accrued in the
amount of approximately $237,000. Crabtree's expenses decreased from 1993 to
1994 by $206,465 or 14.9% which was primarily attributable to a decrease in
salaries and employee benefits from $508,000 in 1993 to $318,000 in 1994.

First Premium's net income increased 153% from $(361,546) in 1993 to
$190,386 in 1994. Premium financing revenues increased $3,935,143 or 91.6%
from $4,297,447 in 1993 to $8,232,590 in 1994. This increase resulted primarily
from the increase in the amount of managed insurance premium receivables
financed in 1994 over 1993. Total loans financed, net of finance charges,
increased 57.4% to $247,551,180 from $157,342,176 in 1993, and the number of
contracts representing these loans increased 40.8% to 16,285 from 11,570. First
Premium's average managed receivables for the year ended December 31, 1994
increased $36,441,674, or 73.5%, from the year ended December 31, 1993. First
Premium's total expenses increased $3,413,862 or 72.6% from $4,703,800 in 1993
to $8,117,662 in 1994. The primary component of this increase was in interest
expense which increased $2,126,057 or 128% from $1,654,848 in 1993 to
$3,780,905 in 1994. This increase was due to the 73.5% increase in the amount
of receivables outstanding from 1993 to 1994. Salaries and employee benefits
increased $686,201 or 50.4% from $1,361,340 in 1993 to $2,047,541 in 1994.
This increase was as a result of First Premium hiring additional sales and
administrative personnel to handle the increase in the outstanding premium
finance receivables.

Prospect's net loss decreased from $(761,000) in 1993 to $(99,000) in
1994. This reduction in the net loss primarily resulted from a decrease in the
provision for lease losses from $750,000 in 1993 to $72,000 in 1994. The large
lease loss provision in 1993 was primarily due to additional losses in the
remaining portfolio retained by Prospect and against receivables which were
sold with recourse in prior years.

Credit Life net loss decreased from $(568,914) in 1993 to $(236,000)
in 1994. This loss was primarily attributable to a $422,000 loss provision in
1993 which was required as a result of accounting for certain contractual
obligations entered into by Crabtree in conjunction with the purchase of Credit
Life in 1987.

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160

Comparison of Results for Year Ended December 31, 1995 to Year Ended December
31, 1994

The net income of Crabtree increased from $955,060 in the year ended
December 31, 1994 to income of $1,882,401 in the year ended December 31, 1995.
The net income by component is included in the following table:

YEAR ENDED DECEMBER 31, INCREASE
------------------------------------------ (DECREASE)
1994 1995 IN INCOME
--------------------- -------------------- -----------

Crabtree income . . $ 373,013 $ 1,009,903 $ 636,890
Crabtree expenses . (1,183,459) (1,269,264) (85,805)
First Premium . . . 190,386 2,344,598 2,154,212
Prospect . . . . . (99,000) (186,000) (87,000)
Credit Life . . . . $ (236,000) $ (16,836) $ 219,164
----------- ----------- ----------
$ (955,060) $ 1,882,401 $2,837,461
=========== =========== ==========

Crabtree's income increased $636,890 from $373,013 in 1994 to
$1,009,903 in 1995. This increase was primarily attributable to a gain of
approximately $735,000 which was realized in 1995 from a settlement agreement
reached with Credit Life in connection with certain obligations of Crabtree
which were created as a result of the purchase agreement entered into whereby
Crabtree purchased a controlling interest in Credit Life in 1987. Crabtree's
expenses increased $85,805 or 7.3% from $1,183,459 in 1994 to $1,269,264 in
1995. This increase was primarily attributable to increased interest expense
of $64,215 or 22.9% from $279,864 in 1994 to $344,079 in 1995. This increase
in interest expense was attributable to slightly higher average debt
outstanding and higher interest rates.

First Premium's net income increased by 1132% from $190,386 in 1994 to
$2,344,598 in 1995. Premium financing revenues decreased $5,699,933 or 69.2%
from $8,232,590 in 1994 to $2,534,657 in 1995. This decrease resulted from a
change in the structure of the company's securitization facility in February of
1995 which dictated different accounting treatment for loans sold to the
securitization facility. The new structure permitted the company to record
gains on receivables sold to an independent third party at the time of sale
rather than recording the income as earned over the life of the loan as the
company had done in prior years. Gain on sale of receivables of $4,421,000 was
recorded in 1995 versus none in 1994. This amount represented the normal sales
under the new facility plus a one-time gain which was recorded in February of
1995 when existing loans were sold to the new facility. Total loans financed,
net of finance charges, increased 21.9% to $301,852,237 in 1995 from
$247,551,180 in 1994, and the number of contracts represented increased 5.0% to
17,104 in 1995 from 16,285 in 1994. First Premium's average managed
receivables for the year ended December 31, 1995 increased $21,179,537 or 24.7%
from $85,912,066 in 1994 to $107,091,603 in 1995. First Premium's total
expenses decreased $2,424,461 or 29.9% from $8,117,662 in 1994 to $5,693,201 in
1995. The primary components of the decrease involved interest expense
primarily related to commercial paper, which decreased $2,856,330 or 75.6% from
$3,780,905 in 1994 to $924,575 in 1995. This decrease was the result of the
change in the company's securitization facility. Prior to February, 1995,
First Premium funded the origination of Premium finance receivables through the
issuance of commercial paper. As discussed above, beginning in February, 1995,
First Premium began selling its receivables to a third party and recorded a
gain on the sale. This new securitization facility provided liquidity and a
source of funding to replace the commercial paper. The major increases in
operating expenses involved salaries and benefits which increased $295,123 or
14.4%, provision for doubtful accounts which increased $181,621 or 279%, and
other operating expenses which increased $355,101 or 137%. The increased
operating expenses were generally attributable to the overall increase in
business activity and the amount of premium finance receivables outstanding.

Prospect's net loss increased from $99,000 in 1994 to $186,000 in
1995. This increase in the net loss was primarily attributable to an increase
in the provision for lease losses from $72,000 in 1994 to $100,000 in 1995 and
a lower amount of income as a result of the continuing run-off of the remaining
lease portfolio of Prospect.

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161

Credit Life net loss decreased from $236,000 in 1994 to $16,836 in
1995. This decrease is primarily attributable to less expense as a result of
the majority of the operations of Credit Life being wound down and final
contingencies being settled. As of December 31, 1995, Crabtree has adopted
liquidation accounting for the remaining operations of Credit Life and has
effectively written off its entire remaining investment in Credit Life.

LIQUIDITY AND CAPITAL RESOURCES

Crabtree's operations are dependent on the continuing availability of
funds at satisfactory terms and rates. Crabtree has bank debt of $1,950,000
together with subordinated debt of $1,200,000 as of December 31, 1995. This
debt was primarily incurred in prior years to finance investments in operating
subsidiaries.

At December 31, 1995, First Premium's operations are also dependent on
the availability of funds at satisfactory terms and rates. First Premium uses
such funds principally to finance the origination of installment loans under
premium finance agreements. First Premium obtains funds from a variety of
sources, including internal generation of funds, secured borrowings under lines
of credit, use of an asset securitization facility, placement of subordinated
debt, and the sale of common equity.

As First Premium increases the size of its business, it originates
more installment loans receivable than it collects, resulting in a larger
outstanding balance of installment loans receivable. The following table sets
forth the amounts of installment loans receivable originated and the collection
of the installment loans receivable for the periods indicated (in thousands):

THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED MARCH 31,
------------------------------------------------- ---------------------------------
1993 1994 1995 1995 1996
---------------- ---------------- --------------- ---------------- ----------------

Installment loans originated . . . $162,111,431 $255,997,476 $313,988,071 $ 79,848,248 $ 79,307,555
Installment loans collected . . . . 121,754,057 226,878,470 294,352,076 70,054,169 76,738,861

The growth in First Premium's loan portfolio has been the single
largest factor influencing First Premium's cash flow from operations and its
need for financing. The majority of First Premium's financing is provided by
the sale of installment loan receivables to its wholly-owned subsidiary, First
Premium Financing Corporation, which in turn sells the receivables to Holland
Limited Securitization, Inc., which is an independent, multi-seller conduit
which issues commercial paper or other indebtedness to fund the purchase of
receivables from First Premium Financing Corporation. For the years ended
December 31, 1995 and 1994, net cash provided by operating activities was
$4,721,000, and $6,355,000, respectively. For the years ended December 31,
1995 and 1994, net cash used in and provided by financing activities was
$(83,287,000) and $23,826,000, respectively.

First Premium has no present plans for any significant capital
expenditures, but does intend to add marketing personnel in order to increase
its volume of new business. First Premium does not expect that such additional
marketing personnel will require any significant capital expenditures. First
Premium is not aware of any pending legislation that would have a material
effect on capital requirements or business prospects.

First Premium is subject to minimum capital requirements imposed by
certain of the states in which it is licensed. First Premium is substantially
in excess of the requirements of all the states in which it is licensed to
conduct business. In addition, First Premium is prohibited from declaring or
paying any dividends on its capital stock pursuant to agreements entered into
in conjunction with its securitization facility and bank loan agreements.

The source of funds (other than internal generation of funds and the
sale of common equity) which are presently available are being utilized by
First Premium as described below. Management believes that the sources of
funds presently available to First Premium are adequate for the conduct of its
business at its present level. To the extent that First Premium in the future
expands its business and increases its total installment receivables
outstanding beyond its present level of funding, First Premium will need to
obtain additional sources of funds or expand existing sources of funds, which
may not be available, or, if available, may not be available on terms
acceptable to First Premium.

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162

LINES OF CREDIT

At December 31, 1995, First Premium had a revolving loan agreement
with a bank, which matures in May 1996. Terms of the agreement include
providing a lien and first security interest in the premium finance receivables
not sold to its securitization facility to the bank, as well as restrictions on
maintenance of various operating ratios and tangible net worth. The facility
is comprised of two lines of credit which can be combined to a maximum of $13
million. The primary line is at the bank's prime rate of interest. Borrowings
are based on an eligible premium finance receivables base to a maximum of $13
million. The supplemental line bears interest at the bank's prime rate plus
1.0%, to a maximum of $3 million. Borrowings are based on amounts of
collateral First Premium maintains in its securitization facility. During the
years ended December 31, 1995 and 1994, the maximum aggregate amount
outstanding under these lines during this time were $2,975,658 and $2,989,178,
respectively.

SECURITIZATION FACILITY

Beginning in 1993 and continuing until the formation of a new facility
in 1995, First Premium sold its receivables to a nominally capitalized,
independently owned, special-purpose corporation called First Premium Funding
Corporation ("FPFC"). FPFC was in the business of issuing commercial paper and
purchasing receivables from First Premium. Pursuant to a Sales and Servicing
Agreement between First Premium and FPFC, FPFC had engaged First Premium to
provide certain administrative services related to the servicing of the loans
and compensated First Premium as the Servicer. First Premium also was
performing all other administrative functions of FPFC, such as cash management
and accounting services, pursuant to a management agreement.

In 1993, Internationale Netherlanden Bank, N.V. ("ING") became the
credit enhancer for commercial paper issued by FPFC. ING continued to provide
temporary liquidity to FPFC. The interest rate charged on any borrowing on the
liquidity line would be the higher of prime or the federal funds rate plus
1/2%.

Effective January 31, 1995, First Premium entered into a new
securitization facility with ING and Holland Limited Securitization, Inc.
("HLS"). The new facility effectively amends and modifies the above-discussed
facility and provides First Premium with a vehicle into which $200 million of
receivables may be sold and funded by HLS, subject to certain terms and
conditions. On the closing date of the previous facility, FPFC and First
Premium terminated all contractual obligations with regard to the discontinued
facility, and FPFC ceased operations.

In connection with the 1995 facility restructuring, First Premium
formed a new wholly-owned, bankruptcy remote subsidiary, First Premium
Financing Corporation ("FPFIN"), to purchase the receivables from First Premium
and simultaneously sell the receivables to HLS. Consistent with the prior
securitization facility, all the receivable sales to HLS are without recourse.
FPFIN recognizes a gain at the time of each sale based on its estimate of
Excess Servicing, as defined, to be earned over the life of the receivables
sold. All of the subsidiary accounts are maintained by First Premium and
consolidated with First Premium's financial statements. First Premium performs
all administrative functions of FPFIN, such as cash management and accounting
services.

HLS is an independent multiseller conduit which issues commercial
paper or other indebtedness to fund the purchase of receivables from FPFC. HLS
is not affiliated with First Premium or its affiliates. Pursuant to the Sale
and Servicing Agreement between HLS and FPS, HLS has engaged First Premium to
provide certain administrative services related to the servicing of the loans
and compensates First Premium as the Servicer. Also pursuant to the Sales and
Servicing Agreement, First Premium is required to maintain facility collateral
at an amount equal to 105.5% of commercial paper outstanding. The amount of
this over collateralization is recorded as a long-term asset on First Premium's
consolidated financial statement. Consistent with the prior securitization
facility terms, ING will provide the credit and liquidity enhancement for the
facility.

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163

SUBORDINATED DEBT

First Premium has obtained subordinated debt in the amount of $500,000
from Crabtree and from an independent investor which is also a stockholder of
Crabtree. The subordinated notes of $300,000 from the independent investor and
$200,000 from Crabtree bear interest at prime plus 0.5% and mature on December
23, 1997. First Premium may at its option prepay the loans in whole or in part
at any time.

LEGAL MATTERS

Vedder, Price, Kaufman & Kammholz, 222 North LaSalle Street, Chicago,
Illinois 60601, will pass upon the validity of the shares of Wintrust Financial
Corporation Common Stock to be issued pursuant to the Reorganization and
certain other legal matters in connection with the Reorganization for each of
the Companies.

Certain legal matters in connection with the Reorganization will be
passed upon for North Shore, Lake Forest, Hinsdale and Libertyville by Meltzer,
Purtill & Stelle, 1515 East Woodfield Road, Schaumburg, Illinois 60173, and for
Crabtree by Rudnick & Wolfe, 203 North LaSalle Street, Chicago, Illinois 60601.

EXPERTS

The consolidated financial statements of Lake Forest Bancorp, Inc. as
of December 31, 1995 and 1994, and for each of the years in the three-year
period ended December 31, 1995, Hinsdale Bancorp, Inc. as of December 31, 1995
and 1994 and for the each of the years ended December 31, 1995 and 1994 and the
period September 25, 1992 (date of incorporation) to December 31, 1993, North
Shore Community Bancorp, Inc. as of December 31, 1995 and 1994 and for the
year ended December 31, 1995 and for the period December 30, 1992 (date of
incorporation) to December 31, 1994, and Libertyville Bancorp, Inc. as of
December 31, 1995 and for the period September 26, 1994 (date of incorporation)
to December 31, 1995, have been included herein and in the registration
statement in reliance upon the reports of KPMG Peat Marwick LLP, independent
certified public accountants, appearing elsewhere herein, and upon the
authority of said firm as experts in accounting and auditing.

The consolidated financial statements Crabtree Capital Corporation
included in this prospectus and elsewhere in the registration statement, to the
extent and for the periods indicated in their reports, have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said reports.

OTHER MATTERS

As of the date hereof, the Boards of Directors of the Companies do not
know of any matters to be presented at the Special Meetings other than those
listed in the Notice of Special Meeting of Stockholders pertaining thereto. If
any other matters come before a Special Meeting or any adjournment thereof, it
is intended that the proxies will be voted in respect thereof in accordance
with the judgment of the person or persons voting the proxies.

143
164

AVAILABLE INFORMATION

Wintrust Financial Corporation has filed a Registration Statement
under the 1933 Act with the Securities and Exchange Commission in connection
with the Wintrust Common Stock offered hereby. This Prospectus and Joint Proxy
Statement omits certain information, exhibits and undertakings set forth in the
Registration Statement. Such materials may be examined and copies thereof may
be obtained, upon payment of prescribed rates, from the public reference
facilities of the Securities and Exchange Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Regional Office of the Commission at the
following locations: Seven World Trade Center, Suite 1300, New York, New York
10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. For
further information with respect to Wintrust, reference is hereby made to the
Registration Statement and the exhibits thereto. Statements contained in this
Prospectus and Joint Proxy Statement concerning the provisions of any contract,
agreement or other document are not necessarily complete, and in each instance
reference is made to the copy of such contract, agreement or other document
filed as an exhibit to the Registration Statement for a full statement of the
provisions thereof. Each such statement in this Prospectus and Joint Proxy
Statement is qualified in all respects by such reference.

For fiscal years which end following the Effective Date, Wintrust will
furnish to its stockholders annual reports of Wintrust Financial Corporation,
including consolidated financial statements of Wintrust, certified by
independent public accountants.

144
165

INDEX TO FINANCIAL STATEMENTS

Page
----

NORTH SHORE COMMUNITY BANCORP, INC. AND SUBSIDIARY
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1
Consolidated Statements of Condition as of March 31, 1996 (unaudited)
and December 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-2
Consolidated Statements of Operations for the three-month
periods ended March 31, 1996 and 1995 (unaudited),
and for the year and period ended December 31, 1995 and 1994, respectively . . . . . . . . . . F-3
Consolidated Statements of Changes in Shareholders' Equity
for the three-month period ended March 31, 1996 (unaudited),
and for the year and period ended December 31, 1995 and 1994, respectively . . . . . . . . . . F-4
Consolidated Statements of Cash Flows for the three-month
periods ended March 31, 1996 and 1995 (unaudited),
and for the year and period ended December 31, 1995 and 1994, respectively . . . . . . . . . . F-5
Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . F-6

LAKE FOREST BANCORP, INC.
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-19
Consolidated Statements of Condition as of March 31, 1996
(unaudited) and December 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . F-20
Consolidated Statements of Operations for the three-month
periods ended March 31, 1996 and 1995 (unaudited),
and for the years ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . F-21
Consolidated Statements of Changes in Stockholders' Equity for the
three-month period ended March 31, 1996 (unaudited),
and for the years ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . F-22
Consolidated Statements of Cash Flows for the three-month periods
ended March 31, 1996 and 1995 (unaudited), and for the
years ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . . . . . . . F-23
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-24

HINSDALE BANCORP, INC.
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-39
Consolidated Statements of Condition as of March 31, 1996
(unaudited) and December 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . F-40
Consolidated Statements of Operations for the three-month periods
ended March 31, 1996 and 1995 (unaudited), and for
the years ended December 31, 1995 and 1994, and
for the period ended December 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-41
Consolidated Statements of Changes in Stockholders' Equity for the
three-month period ended March 31, 1996 (unaudited),
and for the years ended December 31, 1995 and 1994, and
for the period ended December 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-42
Consolidated Statements of Cash Flows for the three-month periods
ended March 31, 1996 and 1995 (unaudited), and for the
years ended December 31, 1995 and 1994, and for the period
ended December 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-43
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-44

145
166

LIBERTYVILLE BANCORP, INC.
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-58
Consolidated Statements of Condition as of March 31, 1996
(unaudited) and December 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-59
Consolidated Statements of Operations for the three-month period ended
March 31, 1996 (unaudited), and for the period ended December 31, 1995 . . . . . . . . . . . . . F-60
Consolidated Statements of Changes in Stockholders' Equity for the three-month
period ended March 31, 1996 (unaudited), and for the period ended
December 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-61
Consolidated Statements of Cash Flows for the three-month period ended
March 31, 1996 (unaudited), and for the period ended
December 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-62
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-63

CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES
Report of Independent Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-73
Consolidated Balance Sheets as of March 31, 1996 (unaudited)
and December 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-74
Consolidated Statements of Income for the three months
ended March 31, 1996 and 1995 (unaudited), and
for the years ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . . . . F-75
Consolidated Statements of Stockholders' Equity for the three months
ended March 31, 1996 (unaudited), and for the
years ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . . . . . . . . F-76
Consolidated Statements of Cash Flows for the three months
ended March 31, 1996 (unaudited), and for the years
ended December 31, 1995, 1994, and 1993 . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-77
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-78

146
167

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and
Shareholders of North Shore
Community Bancorp, Inc. and
Subsidiaries:

We have audited the accompanying consolidated statements of condition
of North Shore Community Bancorp, Inc. and subsidiaries (Bancorp) as of
December 31, 1995 and 1994 and the related consolidated statements of
operations, changes in shareholders' equity, and cash flows for the
year ended December 31, 1995 and the period from December 30, 1992
(date of incorporation) to December 31, 1994. These consolidated
financial statements are the responsibility of Bancorp's management.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
North Shore Community Bancorp, Inc. and subsidiaries as of December 31,
1995 and 1994 and the results of their operations and their cash flows
for the year ended December 31, 1995 and the period December 30, 1992
(date of incorporation) to December 31, 1994 in conformity with
generally accepted accounting principles.

/s/ KPMG Peat Marwick LLP

March 11, 1996

F-1

168

NORTH SHORE COMMUNITY BANCORP, INC.

Consolidated Statements of Condition

(in thousands, except share data)

- ----------------------------------------------------------------------------------------------------------------------
December 31,
March 31, --------------------------------
ASSETS 1996 1995 1994
- ----------------------------------------------------------------------------------------------------------------------
(unaudited)

Cash and demand balances due from banks $ 3,739 3,772 2,042
Money market assets:
Interest-bearing deposits at banks 10,000 7,000 14,000
Federal funds sold 8,875 12,000 7,170
Investment securities:
Available-for-sale, at fair value 12,054 11,535 --
Held-to-maturity, at amortized cost (fair value of $9,101) -- -- 9,172

Loans 74,338 63,439 9,618
Less allowance for possible loan losses 510 440 50
- ----------------------------------------------------------------------------------------------------------------------
Loans, net 73,828 62,999 9,568

Accrued interest receivable 541 571 176
Premises and equipment, net 7,107 5,807 2,522
Deferred organization costs 232 252 327
Goodwill 56 57 59
Other assets 1,506 1,129 128
- ----------------------------------------------------------------------------------------------------------------------
Total assets $ 117,938 105,122 45,164
======================================================================================================================
LIABILITIES AND SHAREHOLDERS# EQUITY
- ----------------------------------------------------------------------------------------------------------------------
Deposits:
Noninterest-bearing 12,569 13,571 5,539
Interest-bearing 93,671 80,086 31,197
- ----------------------------------------------------------------------------------------------------------------------
Total deposits 106,240 93,657 36,736

Accrued interest payable 187 142 31
Other liabilities 104 195 147
- ----------------------------------------------------------------------------------------------------------------------
Total liabilities 106,531 93,994 36,914

Shareholders' equity:
Common stock, no par value; stated value $1 per share; 400,000
shares authorized; 253,809, 246,855 and 196,980 shares issued
and outstanding at March 31, 1996, December 31, 1995 and 1994,
respectively 254 246 197
Convertible warrants, no par value, 5,000 shares authorized,
issued, and outstanding 25 25 25
Surplus 12,161 11,651 7,961
Undivided profits (deficit) (1,032) (795) 67
Net unrealized gain on securities available-for-sale (1) 1 --
- ----------------------------------------------------------------------------------------------------------------------
Total shareholders' equity 11,407 11,128 8,250
- ----------------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $ 117,938 105,122 45,164
======================================================================================================================

See accompanying notes to consolidated financial statements.

F-2
169

NORTH SHORE COMMUNITY BANCORP, INC.

Consolidated Statements of Operations

(in thousands)

- ----------------------------------------------------------------------------------------------------------------------
Three months
ended March 31, Year ended Period ended
------------------------- December 31, December 31,
1996 1995 1995 1994
- ----------------------------------------------------------------------------------------------------------------------
(unaudited)

Interest income:
Loans, including fees $ 1,350 279 2,649 72
Money market assets:
Interest-bearing deposits at banks 93 254 914 169
Federal funds sold 169 111 478 142
Investment securities 192 143 546 77
- ----------------------------------------------------------------------------------------------------------------------
Total interest income 1,804 787 4,587 460
- ----------------------------------------------------------------------------------------------------------------------
Interest expense:
Deposits 1,114 507 2,841 260
Term debt -- -- -- 16
- ----------------------------------------------------------------------------------------------------------------------
Total interest expense 1,114 507 2,841 276
- ----------------------------------------------------------------------------------------------------------------------
Net interest income 690 280 1,746 184

Provision for possible loan losses 79 60 428 50
- ----------------------------------------------------------------------------------------------------------------------
Net interest income after provision for possible loan losses 611 220 1,318 134
- ----------------------------------------------------------------------------------------------------------------------
Noninterest income:
Retail income 23 4 36 7
Fees on loans sold 117 16 196 --
Other income 9 6 32 29
- ----------------------------------------------------------------------------------------------------------------------
Total noninterest income 149 26 264 36
- ----------------------------------------------------------------------------------------------------------------------
Noninterest expense:
Salaries and other compensation 523 218 1,189 546
Net occupancy 73 21 124 43
Advertising and marketing 72 32 205 65
Data processing 57 29 143 36
Depreciation - furniture, fixtures and equipment 53 24 104 22
Amortization of organization costs and goodwill 21 17 77 24
Other 198 109 602 330
- ----------------------------------------------------------------------------------------------------------------------
Total noninterest expense 997 450 2,444 1,066
- ----------------------------------------------------------------------------------------------------------------------
Net loss $ (237) (204) (862) (896)
======================================================================================================================
Loss per share $ (0.95) (1.04) (4.29) (12.26)
======================================================================================================================

See accompanying notes to consolidated financial statements.

F-3
170

NORTH SHORE COMMUNITY BANCORP, INC.

Consolidated Statements of Changes in Shareholders' Equity

(in thousands)

- -----------------------------------------------------------------------------------------------------------------------------
Net
unrealized
gain on
Undivided securities Total
Common Preferred Convertible profits available shareholders'
stock stock warrants Surplus (deficit) for sale equity
- -----------------------------------------------------------------------------------------------------------------------------

Initial Capital Contribution $ 1 500 25 -- -- -- 526

Redemption of 5,000 warrants -- -- (25) -- -- -- (25)

Reissuance of 2,500 warrants -- -- 13 -- -- -- 13

Issuance of 2,500 warrants -- -- 12 -- -- -- 12

Dividends paid -- -- -- -- (37) -- (37)

Initial offering 173 -- -- 7,497 1,000 -- 8,670

Capital issuance costs -- -- -- (13) -- -- (13)

Conversion of preferred
stock 23 (500) -- 477 -- -- --

Net loss -- -- -- -- (896) -- (896)
- -----------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1994 197 -- 25 7,961 67 -- 8,250

Common stock issuance 49 -- -- 3,690 -- -- 3,739

Net loss -- -- -- -- (862) -- (862)

Change in unrealized
gain on securities
available-for-sale, net of tax effect -- -- -- -- -- 1 1
- -----------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1995 246 -- 25 11,651 (795) 1 11,128

Common stock issuance 9 -- -- 557 -- -- 566

Repurchase of common stock (1) -- -- (47) -- -- (48)

Net loss -- -- -- -- (237) -- (237)

Change in unrealized
gain on securities
available-for-sale, net of tax effect -- -- -- -- -- (2) (2)
- -----------------------------------------------------------------------------------------------------------------------------

Balance at March 31, 1996 (unaudited) $ 254 -- 25 12,161 (1,032) (1) 11,407
=============================================================================================================================

See accompanying notes to consolidated financial statements.

F-4

171

NORTH SHORE COMMUNITY BANCORP, INC.

Consolidated Statements of Cash Flows

(in thousands)

======================================================================================================================
Three months Year ended Period ended
ended March 31, December 31, December 31,
1996 1995 1995 1994
-------------------------
(unaudited)
- ----------------------------------------------------------------------------------------------------------------------

Operating activities:
Net loss $ (237) (204) (862) (896)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 104 52 217 (38)
Provision for possible loan losses 79 60 428 50
Net accretion/amortization of investment securities (88) (121) (257) (67)
Increase in accrued interest receivable and other assets (345) (301) (1,372) (606)
Increase in other liabilities (46) (46) 159 235
- ----------------------------------------------------------------------------------------------------------------------
Net cash used in operating activities (533) (560) (1,687) (1,322)
- ----------------------------------------------------------------------------------------------------------------------
Investing activities:
Net decrease (increase) in interest-bearing deposits at banks (3,000) (10,465) 7,000 (14,000)
Net decrease (increase) in Federal funds sold 3,125 1,728 (4,830) (7,170)
Purchase of investment in Federal Reserve Bank stock -- -- (14) (198)
Purchases of investment securities (21,935) (2,844) (21,588) (8,907)
Maturity of investment securities 21,500 5,095 19,495 --
Purchase of premises and equipment (1,383) (471) (3,447) (2,625)
Net increase in loans (10,908) (7,612) (53,859) (9,618)
- ----------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (12,601) (14,569) (57,243) (42,518)
- ----------------------------------------------------------------------------------------------------------------------
Financing activities:
Net increase in deposits 12,583 14,631 56,921 36,736
Proceeds from issuance of common stock 566 -- 3,739 8,658
Proceeds from issuance of preferred stock -- -- -- 500
Proceeds from issuance of common stock warrants -- -- -- 25
Repurchase of common stock (48) -- -- --
Proceeds from issuance of long-term debt -- -- -- 1,400
Repayment of long-term debt -- -- -- (1,400)
Dividends paid -- -- -- (37)
- ----------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities 13,101 14,631 60,660 45,882
- ----------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents (33) (498) 1,730 2,042
Cash and cash equivalents at beginning of period 3,772 2,042 2,042 --
- ----------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 3,739 1,544 3,772 2,042
- ----------------------------------------------------------------------------------------------------------------------
Supplemental disclosures of cash flow information--
Cash paid during the year for:
Interest $ 1,069 473 2,730 245
Income taxes -- -- -- --
======================================================================================================================

See accompanying notes to consolidated financial statements.

F-5
172

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

North Shore Community Bancorp, Inc. (Bancorp) was incorporated on December
30, 1992. North Shore Community Bank and Trust Company (Bank) is a
subsidiary of Bancorp. The Bank commenced operations on September 14,
1994, operating under an Illinois state banking charter. The Bank
currently operates primarily in the Wilmette, Kenilworth, Glencoe and
Winnetka, Illinois areas.

The former North Shore Building Corporation (the Building Corporation) was
a wholly owned subsidiary of Bancorp that was merged into the Bancorp in
June 1995. The net assets of the Building Corporation were subsequently
contributed from the Bancorp to the Bank. The Building Corporation's
primary asset was the banking premises for the Bank.

The consolidated financial statements of Bancorp and its wholly owned
subsidiaries have been prepared in conformity with generally accepted
accounting principles and prevailing practices of the banking industry.
All material intercompany accounts and transactions have been eliminated in
the consolidated financial statements.

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make certain
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reported period. Actual
results may differ from those estimates.

The unaudited consolidated financial statements have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in annual
financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and
regulations. In the opinion of Bancorp, all adjustments necessary for a
fair presentation for the periods presented have been reflected and are of
a normal and recurring nature. Results of operations for the interim
periods are not necessarily indicative of the results to be expected for
the year.

PREMISES AND EQUIPMENT

Premises and equipment are stated at cost less accumulated depreciation and
amortization. For financial reporting purposes, depreciation and
amortization are computed using the straight-line method over the estimated
useful lives of the related assets, ranging from five to ten years for
equipment and thirty-nine years for buildings. Additions to the premises
are capitalized. Maintenance and repairs are charged to expense as
incurred.

F-6
173

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

INCOME TAXES

Bancorp files consolidated Federal and state income tax returns which
include the subsidiaries. The subsidiaries provide for income taxes on a
separate return basis and remit to Bancorp amounts determined to be
currently payable. Tax benefits attributable to losses are recognized and
allocated to the extent that such losses can be utilized in the
consolidated return.

Bancorp and subsidiaries record income taxes under the asset and liability
method. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the enactment date.

ORGANIZATION COSTS

Organization costs consist primarily of professional fees and other
start-up costs and are being amortized over five years.

INTANGIBLE ASSETS

Goodwill, representing the cost in excess of the fair value of net assets
acquired by Wintrust Investments, Inc. is amortized on a straight-line
basis over a period of fifteen years.

CASH EQUIVALENTS

For purposes of the consolidated statement of cash flows, Bancorp considers
all cash on hand, cash items in the process of collection, and amounts due
from correspondent banks to be cash equivalents.

LOANS AND ALLOWANCE FOR POSSIBLE LOAN LOSSES

Loans are recorded at the principal amount outstanding. The allowance for
possible loan losses is maintained at a level adequate to provide for
potential loan losses. The Bank receives loan fees for loans originated by
the Bank, as well as for loan referrals. Fees associated with loans
originated by the Bank are deferred and amortized over the life of the
loans as an adjustment of yield using the interest method. Loan fees for
referrals are recognized as income when received.

On January 1, 1995, Bancorp adopted Financial Accounting Standards Board
Statement No. 114, "Accounting by Creditors for Impairment of a Loan"
(Statement 114), as amended by Statement No. 118, "Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosures" (Statement
118). Under Statement 114, impaired loans are reported at the present
value of expected future cash flows at the loan's effective interest rate,
and the loan's observable market price or fair value of the collateral, if
the loan is collateral dependent. The impact of the adoption of Statements
114 and 118 was not material to the Bancorp.

(Continued)

F-7

174

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

INVESTMENT SECURITIES

Investment securities are accounted for by applying the provisions of
Statement of Financial Accounting Standards No. 115, Accounting of Certain
Investments in Debt and Equity Securities (Statement 115). Under Statement
115, the Bank can classify securities in one of three categories: trading,
held-to-maturity, or available-for-sale. Trading securities are bought
principally for the purpose of selling them in the near term.
Held-to-maturity securities are those securities in which the Bank has the
ability and intent to hold the security until maturity. All other
securities are classified as available-for-sale as they may be sold prior
to maturity.

Held-to-maturity securities are stated at amortized cost which represents
actual cost adjusted for amortization of premium and accretion of discount
using methods that generally approximate the effective interest method.
Available-for-sale securities are stated at fair value. Unrealized holding
gains and losses on available-for-sale securities, net of related taxes,
are excluded from earnings and reported as a separate component of
shareholders' equity until realized. A decline in the market value of any
available-for-sale or held-to-maturity security below cost, that is deemed
to be other than temporary, is charged to earnings. Gains or losses on the
sale of securities are recorded on a completed transaction basis using
specific identification and are reflected in the accompanying statements of
operations as part of other noninterest income.

Trading account securities are stated at fair value. Trading account gains
and losses from closing positions and from changes in market values of the
trading inventory are reflected in the accompanying statement of operations
as part of other noninterest income. Bancorp did not maintain any trading
account securities in 1995 or 1994.

A decline in the market value of any available-for-sale or held-to-maturity
security below cost that is deemed other than temporary is charged to
earnings resulting in the establishment of a new cost basis for the
security. Dividend and interest income are recognized when earned.
Realized gains and losses for securities classified as available-for-sale
and held-to-maturity are included in earnings and are derived using the
specific identification method for determining the cost of securities sold.

RECLASSIFICATION

Certain amounts in the prior years' financial statements have been
reclassified to conform to the current year presentation.

(2) TERM DEBT

The Bancorp and subsidiaries borrowed $1,400,000 to fund the purchase of
real estate and cover initial start up expenses. This debt was paid off
prior to December 31, 1994 with proceeds Bancorp received through the
issuance of common shares in the private placement offering (see note 12).

(Continued)

F-8

175

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(3) INVESTMENT SECURITIES

The following tables represent amortized cost, gross unrealized gains and
losses, and fair value for the investment securities at December 31, 1995
and 1994. These tables are by contractual maturity which may differ from
actual maturities because borrowers may have the right to call or repay
obligations with or without call or prepayment penalties.

===================================================================================
December 31, 1995
-------------------------------------------------
Gross Gross Approximate
Amortized unrealized unrealized market
cost gains losses value
- -----------------------------------------------------------------------------------
(in thousands)

Available-for-sale:
Federal Agencies - due in
one year or less $8,974 - (3) 8,971
Corporate notes - due in one
year or less 497 2 - 499
Corporate notes - due in one
to five years 1,501 3 (1) 1,503
Common Stock - Libertyville
Bancorp, Inc. 350 - - 350
Federal Reserve Bank stock 212 - - 212
- -----------------------------------------------------------------------------------
$11,534 5 (4) 11,535
===================================================================================

===================================================================================
December 31, 1994
---------------------------------------------------
Gross Gross Approximate
Amortized unrealized unrealized market
cost gains losses value
- -----------------------------------------------------------------------------------
(in thousands)

Held-to-maturity:
Federal Agencies - due in
one year or less $8,974 - (71) 8,903
Federal Reserve Bank stock 198 - - 198
- -----------------------------------------------------------------------------------
$9,172 - (71) 9,101
===================================================================================

There were no sales of investment securities in 1995 or 1994 and,
accordingly, there were no realized gains or losses on sales of investment
securities. At December 31, 1995, securities having a carrying value of
$5,977,000 were pledged as collateral for public deposits. There were no
pledged securities at December 31, 1994.

(Continued)

F-9

176

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

The Financial Accounting Standards Board's (FASB's) issuance of A Guide to
Implementation of Statement 115 on Accounting for Certain Investments in
Debt & Equity Securities, permitted the transfer of securities from the
Held to Maturity classification to the Available for Sale classification
during the period from November 15, 1995 to December 31, 1995, with no
recognition of any related unrealized gain or loss in current earnings. On
December 29, 1995, the Bancorp's portfolio of securities Held to Maturity
was transferred, in its entirety, to the securities Available for Sale
classification. The carrying amount of the securities and the net
unrealized gain related to the transfer were $11,534,000 and $1,000,
respectively.

(4) LOANS

A summary of the loan portfolio by category at December 31, 1995 and 1994
is as follows:

1995 1994
- -----------------------------------------------------------------------------------

(in thousands)

Commercial $20,344 3,551
Home equity 19,121 5,175
Residential 8,557 465
Installment 15,417 427
- -----------------------------------------------------------------------------------
$63,439 9,618
===================================================================================

Certain officers and directors of Bancorp and its subsidiaries and certain
corporations and individuals related to such persons incurred indebtedness
totaling approximately $1,298,000 in the form of loans from the Bank.
These loans were made on substantially the same terms, including interest
rates and collateral, as those prevailing at the time for comparable
transactions with other borrowers.

(Continued)

F-10

177

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(5) ALLOWANCE FOR POSSIBLE LOAN LOSSES

A summary of the changes in the allowance for possible loan losses for the
periods ending December 31, 1995 and 1994 is as follows:

1995 1994
- -----------------------------------------------------------------------------------
(in thousands)

Allowance at beginning of period $ 50 -
Provision 428 50
Charge-offs (38) -
Recoveries - -
- -----------------------------------------------------------------------------------
Allowance at end of period $440 50
===================================================================================

The provision for possible loan losses is charged to operations and
recognized loan losses (recoveries) are charged (credited) to the allowance
for possible loan losses. At December 31, 1995, non-accrual loans had a
carrying value approximating $519,000. The recorded investment in loans
considered to be impaired loans under Statement 114, at December 31, 1995,
approximated $492,000 for which no specific allowance for loan losses was
required in accordance with Statement 114.

(6) PREMISES AND EQUIPMENT, NET

A summary of premises and equipment at December 31, 1995 and 1994 is as
follows:

1995 1994
- -----------------------------------------------------------------------------------
(in thousands)

Land $ 666 189
Buildings 3,830 1,830
Furniture and equipment 1,031 542
Leasehold improvements 480 -
- -----------------------------------------------------------------------------------
6,007 2,561
Less accumulated depreciation
and amortization 200 39
- -----------------------------------------------------------------------------------
$5,807 2,522
===================================================================================

(Continued)

F-11

178

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(7) TIME DEPOSITS

Certificates of deposit in amounts of $100,000 or more approximated
$20,069,000 and $2,400,000 at December 31, 1995 and 1994, respectively. For
the periods ended December 31, 1995 and 1994, interest expense related to
these deposits approximated $584,000 and $16,000, respectively.

(8) LEASE EXPENSE AND OBLIGATIONS

Gross rental expense for all noncapitalized leases was $11,000 in 1995.
Rental income was $26,000 in 1995. Lease commitments are primarily for
office space. Minimum gross rental commitments as of December 31, 1995 for
all noncancelable leases are as follows:
- --------------------------------------------------------------------------------
(in thousands)

1996 $ 106
1997 168
1998 173
1999 179
2000 185
2001 and thereafter 651
- -----------------------------------------------------------------------------------
Total minimum future rentals $ 1,462
===================================================================================
Minimum gross rental income as of December
31, 1995 for all noncancelable leases are as
follows:
- -----------------------------------------------------------------------------------
(in thousands)

1996 $ 23
1997 24
1998 25
1999 26
2000 27
2001 and thereafter 45
- -----------------------------------------------------------------------------------
Total minimum future rentals $ 170
===================================================================================

(9) INCOME TAXES

The Bancorp had no Federal or state income tax expense in the years ended
December 31, 1995 and 1994.

(Continued)

F-12

179

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

Income taxes for 1995 and 1994 differ from the expected tax expense for
those years (computed by applying the applicable statutory U.S. Federal
income tax rate of 34% to income before income taxes) as a result of the
following:

1995 1994
- -----------------------------------------------------------------------------------
(in thousands)

Computed "expected" income tax expense $ (293) (263)
Increase (decrease) in tax resulting from:
Valuation allowance for deferred tax assets 347 262
Other, net (54) 1
- -----------------------------------------------------------------------------------
$ - -
===================================================================================

The tax effects of temporary differences that give rise to
significant portions of the deferred tax assets and deferred
tax liabilities at December 31, 1995 and 1994 are presented
below:
- -----------------------------------------------------------------------------------

1995 1994
- -----------------------------------------------------------------------------------
(in thousands)
Deferred tax assets:
Startup costs $ 114 140
Federal net operating loss carryforward 766 264
State net operating loss carryforward 183 56
Other, net 3 -

Total gross deferred tax assets 1,066 460
Valuation allowance 693 346
- -----------------------------------------------------------------------------------
Total net deferred tax assets 373 114
===================================================================================

Deferred tax liabilities:
Allowance for possible loan losses 30 33
Premises and equipment, due to
differences in depreciation 41 1
Accrual to cash adjustment 252 58

Other, net 50 22
- ---------------------------------------------------------------------------------
Total gross deferred tax liabilities 373 114
- ---------------------------------------------------------------------------------
Net deferred tax assets $ - -
=================================================================================

(Continued)

F-13

180

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

At December 31, 1995, Bancorp had Federal net operating losses of
approximately $2,253,000, and state net operating losses of approximately
$2,555,000. Such amounts are available for carryforward to offset future
taxable income and expire in 2009-2010. The realization of such deferred
tax assets in future years is uncertain due to the lack of a sufficient tax
history. As a result, a valuation allowance has been recognized for the
portion of the net operating loss carryforwards not offset by deferred tax
liabilities.

(10) COMPENSATION PLANS

Effective September 16, 1994 upon shareholder approval, Bancorp adopted a
Stock Option Plan (Plan) which provides options to purchase an aggregate of
up to 31,500 shares of Bancorp's common stock at the fair market value of
the stock on the date the option is granted. The Plan permits the grant of
incentive stock options, nonqualified stock options, and restricted stock.
It covers certain key employees of Bancorp. The incentive and nonqualified
options expire at such time as the Stock Option Committee shall determine
at the time of grant; however, in no case shall they be exercisable later
than ten years after the grant. These options generally vest 10% in the
first year subsequent to the grant, 10% in the second year subsequent to
the grant, 20% in the year in which the Company attains certain
profitability levels, and 20% in each year thereafter.

A summary of the activity in the Plan for 1995 and 1994 is as follows:

=================================================================================
Common Range of
Shares Strike Prices
- ---------------------------------------------------------------------------------

Beginning balance at December 30, 1992 - -
Granted 23,000 $50.00
Exercised - -
Forfeited or canceled - -
- ---------------------------------------------------------------------------------
Outstanding at December 31, 1994 23,000 $50.00

Granted 6,100 $60.00-$75.00
Exercised - -
Forfeited or canceled - -
- ---------------------------------------------------------------------------------
Outstanding at December 31, 1995 29,100 $50.00-$75.00
- ---------------------------------------------------------------------------------
Available for grant at December 31, 1995 2,400
=================================================================================

(Continued)

F-14

181

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

In December 1995, the Board of Directors approved the granting of 9,614
additional common stock options to employees and certain directors of the
Company. The grants are subject to the approval of the stockholders to
increase the number of authorized shares under the Plan by 20,000 to
accommodate such grants. Stockholder approval was requested in March 1996
and is pending final vote.

During 1995, Bancorp provided a 401(k) Retirement Savings Plan (401(k)
Plan). The 401(k) Plan covers all employees meeting certain eligibility
requirements. Contributions by employees are made through salary
reductions at their direction, limited to $9,240 annually. Employer
contributions to the 401(k) Plan are made at the employer's discretion.
Participants completing 501 hours of service are eligible to share in an
allocation of employer contributions. No employer contributions were made
in 1995.

(11) REGULATORY RESTRICTIONS

Banking laws place restrictions upon the amount of dividends which can be
paid to Bancorp by the subsidiaries. Based on these laws, the Bank is not
permitted to pay dividends until such time as any previous operating
losses have been recovered through earnings. No cash dividends were paid
to Bancorp by the subsidiaries during the periods ended December 31, 1995
and 1994.

The Bank is required to maintain a 9% of capital to asset ratio for three
years as a de novo Bank.

The Bank is required by the Federal Reserve Act to maintain reserves
against deposits. Reserves are held either in the form of vault cash or
balances maintained with the Federal Reserve Bank and are based on average
daily deposit balances and statutory reserve ratios prescribed by the type
of deposit account. At December 31, 1995 and 1994, reserve balances of
approximately $357,000 and $25,000, respectively, were required.

(12) SHAREHOLDERS' EQUITY

Bancorp was incorporated on December 30, 1992 and initially capitalized
through the issuance of 1,000 no par common shares at $1 each; 10,000 no
par preferred convertible shares at $50 each; and 5,000 no par common
stock series A warrants at $5 each. Each series A warrant entitles the
holder to acquire one share of common stock at a purchase price of $50.

Subsequent to the initial capitalization, in 1994, Bancorp raised an
additional $8,670,000 through the private placement issuance of 173,480 no
par common shares. During the initial period of operations, Bancorp
allocated $1,000,000 of the initial surplus to undivided profits to cover
initial operating expenditures.

The 10,000 preferred shares initially outstanding were exchanged for
22,500 common shares of the Bancorp common stock. The preferred stock
received was retired by the Bancorp.

(Continued)

F-15

182

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

The Bancorp also has a stock rights plan for certain key employees and
Directors. Each stock right entitles the holder to purchase one share
of the Bancorp's common stock for $40.00 per share. The plan was
adopted on December 1, 1993 and expires on December 1, 2003. The plan
provides for the issuance of a total of 20,000 such rights. All of the
stock rights have been awarded. As of December 31, 1995, none of the
stock rights have been exercised.

Because of growth, during 1995, the Bancorp authorized the issuance of
53,334 shares of common stock at $75 per share. As of December 31,
1995, this issuance resulted in an additional 49,875 shares sold,
resulting in proceeds of approximately $3.7 million.

(13) COMMITMENTS AND CONTINGENT LIABILITIES

Bancorp is subject to routine litigation arising in the normal course
of their business. In the opinion of management after consultation
with legal counsel, liabilities arising from these proceedings, if
any, are not expected to be material to Bancorp's financial position.

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

The Bancorp's exposure to credit loss in the event of nonperformance
by the other party to the financial instruments for loan commitments
to extend credit and letters of credit is represented by the
contractual amounts of these instruments. The Bancorp uses the same
credit policies in making loan commitments as it does for on-balance
sheet loans.

Financial instruments whose contract amount represent credit risk at
December 31, 1995 are as follows:

=================================================================================
(in thousands)

Commitments to extend credit $ 26,137
Letters of credit 405
- ---------------------------------------------------------------------------------

Loan commitments to extend credit are agreements to lend to a customer
as long as there is no violation of any condition established in the
contract. Commitments generally have fixed expiration dates or other
termination clauses and may require payment of a fee. Since many of the
commitments are expected to expire without being drawn upon, the total
commitment amounts do not necessarily represent future cash
requirements. Collateral held varies but may include residential real
estate, accounts receivable, inventory, property, plant and equipment,
and income-producing commercial properties.

(Continued)

F-16

183

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

Letters of credit written are conditional commitments issued by the
Bancorp to guarantee the performance of a customer to a third party and
are subject to the same credit review and approval process as loans.

(14) FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and
estimated fair values of Bancorp's financial instruments at
December 31, 1995. Financial Accounting Standards Board
Statement No. 107, Disclosures about Fair Value of Financial
Instruments, defines the fair value of a financial
instrument as the amount at which the instrument could be
exchanged in a current transaction between willing parties.

Carrying Fair
value value
- ---------------------------------------------------------------------------------
(in thousands)

Financial assets:
Cash and demand balances due from banks $3,772 3,772
Interest-bearing deposits at banks 7,000 7,000
Federal funds sold 12,000 12,000
Available-for-sale securities 11,535 11,535
Loans 63,439 63,486
Allowance for possible loan losses (440) (440)
Accrued interest receivable 571 571
Financial liabilities:
Non-maturity deposits 43,456 43,456
Deposits with stated maturities 50,201 50,658
Accrued interest payable 142 142
- ---------------------------------------------------------------------------------

Cash and demand balances due from banks and Federal funds sold: The
carrying value of cash and demand balances due from banks and Federal funds
sold approximates fair value due to the short maturity of those
instruments.

Interest-bearing deposits at banks and securities: Fair values of these
instruments are based on quoted market prices of comparable assets.

Loans: Fair values are estimated for portfolios of loans with similar
financial characteristics. Loans are analyzed by type such as commercial,
residential real estate, etc. Each category of loans is further segmented
into fixed and variable interest rate terms.

(Continued)

F-17

184

NORTH SHORE COMMUNITY BANCORP, INC.

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

For variable-rate loans that reprice frequently, estimated fair values
are based on carrying values. The fair value of residential real estate
loans is based on secondary market sources for securities backed by
similar loans, adjusted for differences in loan characteristics. The
fair value for other loans is estimated by discounting scheduled cash
flows through the estimated maturity using estimated market discount
rates that reflect the credit and interest rate inherent in the loan.

Accrued interest receivable and accrued interest payable: The carrying
value of accrued interest receivable and accrued interest payable
approximates market value due to the relatively short period of time to
expected realization.

Deposit liabilities: The fair value of deposits with no stated
maturity, such as non-interest bearing deposits, savings, NOW accounts
and money market accounts, is equal to the amount payable on demand as
of year-end (i.e. the carrying value). The fair value of certificates
of deposit is based on the discounted value of contractual cash flows.
The discount rate is estimated using the rates currently in effect for
deposits of similar remaining maturities.

Commitments to extend credit and standby letters of credit: The fair
value of commitments to extend credit is based on fees currently charged
to enter into similar arrangements, the remaining term of the agreement,
the present creditworthiness of the counterparty, and the difference
between current interest rates and committed interest rates on the
commitments. Because most of Bancorp's commitment agreements were
recently entered into and/or contain variable interest rates, the
carrying value of Bancorp's commitments to extend credit approximates
fair value.

(15) EVENTS (UNAUDITED) SUBSEQUENT TO THE DATE OF THE REPORT OF THE
INDEPENDENT AUDITOR'S REPORT

The Board of Directors have approved a proposed Agreement and Plan of
Reorganization (Agreement) by and among Bancorp, Hinsdale Bancorp, Inc.,
Lake Forest Bancorp, Inc., Libertyville Bancorp, Inc. and Crabtree
Capital Corporation (the Constituents) with North Shore Community
Bancorp, Inc. as the Resulting Corporation. As a part of the merger,
North Shore Community Bancorp, Inc. will be renamed to "WINTRUST
FINANCIAL CORPORATION" (WINTRUST). Pursuant to the Agreement, common
stock of WINTRUST will be exchanged for the outstanding shares of common
stock of the Constituents based upon exchange ratios specified in the
Agreement. The proposed transaction is contemplated to be accounted for
as a pooling of interests transaction and is subject to shareholder and
regulatory approval.

F-18
185
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and
Stockholders of Lake Forest
Bancorp, Inc. and Subsidiary:

We have audited the accompanying consolidated statements of condition
of Lake Forest Bancorp, Inc. and subsidiary (Bancorp) as of December
31, 1995 and 1994, and the related consolidated statements of
operations, changes in stockholders' equity, and cash flows for each of
the years in the three-year period ended December 31, 1995. These
consolidated financial statements are the responsibility of Bancorp's
management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
Lake Forest Bancorp, Inc. and subsidiary as of December 31, 1995 and
1994, and the results of their operations and their cash flows for the
each of the years in the three-year period ended December 31, 1995, in
conformity with generally accepted accounting principles.

/s/ KPMG Peat Marwick LLP

March 1, 1996

F-19

186
LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Consolidated Statements of Condition

(in thousands, except share data)

December 31,
March 31, ----------------------------
ASSETS 1996 1995 1994
- --------------------------------------------------------------------------------------------------------------------
(unaudited)

Cash and demand balances due from banks $ 4,291 3,680 6,379
Money market assets:
Interest-bearing deposits at banks 100 21,100 16,699
Federal funds sold 18,855 13,100 7,135
Investment securities:
Held-to-maturity, at amortized cost (fair value of
$4,988 in 1996, $4,959 in 1995 and $29,270 in 1994) 5,002 5,002 29,984
Available-for-sale, at fair value 57,465 33,890 5,917
Loans 121,055 110,673 70,258
Less allowance for possible loan losses 950 938 642
- --------------------------------------------------------------------------------------------------------------------
Net loans 120,105 109,735 69,616

Premises and equipment, net 8,098 8,144 7,222
Goodwill 44 45 47
Other assets 2,390 2,444 1,156
- --------------------------------------------------------------------------------------------------------------------
Total assets $ 216,350 197,140 144,155
====================================================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY
- --------------------------------------------------------------------------------------------------------------------
Deposits:
Noninterest-bearing 17,094 16,930 13,787
Interest-bearing 182,927 164,256 112,280
- --------------------------------------------------------------------------------------------------------------------

Total deposits 200,021 181,186 126,067
Accrued interest and other expenses 313 339 182
Short-term debt 3,952 3,952 2,742
Repurchase agreements -- -- 5,022
Treasury tax and loan 631 528 694
Other liabilities 338 221 24
- --------------------------------------------------------------------------------------------------------------------
Total liabilities 205,255 186,226 134,731
- --------------------------------------------------------------------------------------------------------------------

Stockholders' equity
Common stock $1 par value; 200,000 shares authorized;
160,810, 160,605, and 158,993 shares issued and outstanding
at March 31, 1996, December 31, 1995 and 1994, respectively 161 161 159
Convertible preferred stock no par value; 7,500 shares authorized;
1,700 shares issued and outstanding 3 3 3
Surplus 9,549 9,533 9,406
Undivided profit (loss) 1,185 1,007 (8)
Net unrealized gain (loss) - securities available-for-sale,
net of tax 197 210 (136)
- --------------------------------------------------------------------------------------------------------------------
Total stockholders' equity 11,095 10,914 9,424
- --------------------------------------------------------------------------------------------------------------------
Total liabilities and stockholders' equity $ 216,350 197,140 144,155
====================================================================================================================

See accompanying notes to consolidated financial statements.

F-20
187
LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Consolidated Statements of Operations

(in thousands, except per share data)

- ----------------------------------------------------------------------------------------------------------------
Three months ended
March 31, Year ended December 31,
------------------- ----------------------------
1996 1995 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------
(unaudited)

Interest income:
Loans, including fees $ 2,434 1,619 8,058 4,412 2,419
Money market assets:
Interest-bearing deposits at banks 148 348 1,330 555 258
Federal funds sold 204 197 876 361 239
Investment securities 659 501 1,916 1,380 827
- ----------------------------------------------------------------------------------------------------------------

Total interest income 3,445 2,665 12,180 6,708 3,743
- ----------------------------------------------------------------------------------------------------------------

Interest expense:
Deposits 2,124 1,630 7,473 3,744 1,904
Short-term debt 76 62 276 87 35
- ----------------------------------------------------------------------------------------------------------------

Total interest expense 2,200 1,692 7,749 3,831 1,939
- ----------------------------------------------------------------------------------------------------------------

Net interest income 1,245 973 4,431 2,877 1,804

Provision for possible loan losses 110 63 301 240 240
- ----------------------------------------------------------------------------------------------------------------

Net interest income after provision for possible
loan losses 1,135 910 4,130 2,637 1,564
- ----------------------------------------------------------------------------------------------------------------

Noninterest income:
Service charges on deposits 34 32 146 105 92
Fees on loans sold 68 28 349 275 551
Gain on sale of securities 18 - - 21 23
Trust fees 115 78 399 202 92
Other 23 11 221 46 25
- ----------------------------------------------------------------------------------------------------------------

Total noninterest income 258 149 1,115 649 783
- ----------------------------------------------------------------------------------------------------------------

Noninterest expense:
Salaries and other compensation 620 478 2,283 1,436 1,179
Net occupancy 124 89 394 223 190
Advertising 34 58 234 152 106
Data processing 96 70 314 211 158
Depreciation - furniture and equipment 70 46 236 132 66
Insurance 18 85 222 239 151
Other 171 143 719 385 297
- ----------------------------------------------------------------------------------------------------------------

Total noninterest expense 1,133 969 4,402 2,778 2,147
- ----------------------------------------------------------------------------------------------------------------

Net income before income taxes 260 90 843 508 200

Income tax expense/(benefit) 82 - (172) - -
- ----------------------------------------------------------------------------------------------------------------

Net income $ 178 90 1,015 508 200
================================================================================================================

Earnings per share $ 1.01 0.54 5.95 3.05 1.32
================================================================================================================

See accompanying notes to consolidated financial statements.

F-21
188
LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Consolidated Statements of Changes in Stockholders' Equity

(in thousands)

=========================================================================================================================
Net
unrealized
gain (loss)
on
Undivided securities Total
Common Preferred profits available stockholders'
stock stock Surplus (loss) for sale equity
- -------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1992 $ 126 3 6,819 (716) - 6,232

Common stock issuance 32 - 2,550 - - 2,582

Net income - - - 200 - 200

Change in unrealized gain on securities
available-for-sale, net of tax effect of $8 - - - - 16 16
- -------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1993 158 3 9,369 (516) 16 9,030

Common stock issuance 1 - 37 - - 38

Net income - - - 508 - 508

Change in unrealized gain on securities
available-for-sale, net of tax effect of $53 - - - - (152) (152)
- -------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1994 159 3 9,406 (8) (136) 9,424

Common stock issuance 2 - 127 - - 129

Net income - - - 1,015 - 1,015

Change in unrealized gain on securities
available-for-sale, net of tax
effect of $108 - - - - 346 346
- -------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1995 161 3 9,533 1,007 210 10,914

Common stock issuance - - 16 - - 16

Net income - - - 178 - 178

Change in unrealized gain on securities
available-for-sale, net of tax effect of $6 - - - - (13) (13)
- -------------------------------------------------------------------------------------------------------------------------
Balance at March 31, 1996 (unaudited) $ 161 3 9,549 1,185 197 11,095
=========================================================================================================================

See accompanying notes to consolidated financial statements.

F-22

189
LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Consolidated Statements of Cash Flows

(in thousands)

- -----------------------------------------------------------------------------------------------------------------------------------
Three months ended
March 31, Year ended December 31,
------------------ ------------------------------------
1996 1995 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------------------
(unaudited)

Cash flows from operating activities:
Net income $ 178 90 1,015 508 200
Adjustments to reconcile net income to net cash provided
by operating activities:
Provision for possible loan losses 110 63 301 240 240
Depreciation and amortization 116 90 413 194 141
Deferred income taxes (82) - 9 - -
Gain on sales of investment securities, net (18) - - (21) (23)
Amortization of goodwill 1 1 2 2 2
Net accretion/amortization of investment securities (127) 10 (219) 139 276
Net increase in other assets 143 (464) (1,296) (519) (293)
Increase (decrease) in accrued interest and other liabilities 91 (24) 246 148 (9)
- ------------------------------------------------------------------------------------------------------------------------------------

Net cash provided by operating activities 412 (234) 471 691 534
- ----------------------------------------------------------------------------------------------------------------------------------
- --

Cash flows from investing activities:
Net increase (decrease) in interest-bearing deposits at banks 21,000 (19,000) (4,401) (10,500) 3,801
Net decrease (increase) in federal funds sold (5,755) (1,205) (5,965) 6,520 (6,142)
Purchase of Federal Reserve Bank stock - - (26) (36) (136)
Purchase of premises and equipment (70) (233) (1,335) (2,971) (2,768)
Proceeds from sale of investment securities, available for sale 126 - 5,006 4,944 6,140
Proceeds from maturities of investment securities, held to maturity - 17,500 20,000 23,500 14,955
Proceeds from maturities of investment securities, available for sale 61,969 10,525 80,234 8,900 (39,157)
Purchases of investment securities, held to maturity - - - (43,853) -
Purchases of investment securities, available for sale (85,545) (24,849) (107,533) (5,646) -
Net increase in loans (10,480) (6,810) (40,420) (24,807) (22,280)
- ----------------------------------------------------------------------------------------------------------------------------------

Net cash used in investing activities (18,755) (24,072) (54,440) (43,949) (45,587)
- ----------------------------------------------------------------------------------------------------------------------------------

Cash flows from financing activities:
Net increase in deposits 18,835 25,551 55,119 44,615 38,456
Net increase (decrease) in treasury tax and loan 103 (412) (166) 92 369
Net decrease (increase) in securities sold under agreement to
repurchase - (5,022) (5,022) (22) 5,044
Net proceeds from issuance of common stock 16 41 129 38 2,582
Increase in short-term debt - 180 1,210 2,742 -
Repayment of short-term debt - - - - (600)
- ----------------------------------------------------------------------------------------------------------------------------------

Net cash provided by financing activities 18,954 20,338 51,270 47,465 46,451
- ----------------------------------------------------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents 611 (3,968) (2,699) 4,207 1,398
Cash and cash equivalents at beginning of year 3,680 6,379 6,379 2,172 1,374
- ----------------------------------------------------------------------------------------------------------------------------------

Cash and cash equivalents at end of year $ 4,291 2,411 3,680 6,379 2,772
==================================================================================================================================

Supplemental disclosures of cash flow information -
cash paid during the year for:
Interest $ 2,226 1,653 7,592 3,690 1,951
Income taxes - - - - -
==================================================================================================================================

See accompanying notes to consolidated financial statements.

F-23
190

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

- --------------------------------------------------------------------------------

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements of Lake Forest Bancorp, Inc.,
(Bancorp) and its wholly owned subsidiary, Lake Forest Bank and Trust
Company (the Bank) have been prepared in conformity with generally accepted
accounting principles and prevailing practices of the banking industry.
All material intercompany accounts and transactions have been eliminated in
the consolidated financial statements.

PREMISES AND EQUIPMENT

Premises and equipment are stated at cost less accumulated depreciation and
amortization. For financial reporting purposes, depreciation and
amortization are computed using the straight-line method over the estimated
useful lives of the related assets ranging from five to ten years for
equipment and the lesser of the useful life or life of the lease for
premises and leasehold improvements. Additions to premises are
capitalized. Maintenance and repairs are charged to expense as incurred.

INCOME TAXES

The Bancorp files consolidated Federal and state income tax returns which
include the Bank. The Bank provides for income taxes on a separate return
basis and remits to Bancorp amounts determined to be currently payable.
Tax benefits attributable to losses are recognized and allocated to the
extent that such losses can be utilized in the consolidated return.

Bancorp and the Bank record income taxes under the asset and liability
method. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled.
The effect on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the enactment date.

(Continued)

F-24

191

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

CASH EQUIVALENTS

For purposes of the consolidated statement of cash flows, Bancorp considers
all cash on hand, cash items in the process of collection, and amounts due
from correspondent banks to be cash equivalents.

INTANGIBLE ASSETS

Goodwill, representing the cost in excess of the fair value of net assets
acquired from Crabtree Trust Company is amortized on a straight-line basis
over a period of 25 years.

LOANS AND ALLOWANCE FOR POSSIBLE LOAN LOSSES

Loans are recorded at the principal amount outstanding. The allowance for
possible loan losses is maintained at a level adequate to provide for
potential loan losses. The Bank receives loan fees for loans originated by
the Bank, as well as for loan referrals. Fees associated with loans
originated by the Bank are deferred and amortized over the life of the loan
as an adjustment of yield using the interest method. Loan fees for
referrals are recognized as income when received.

On January 1, 1995, Bancorp adopted Financial Accounting Standards Board
Statement No. 114, Accounting by Creditors for Impairment of a Loan
(Statement 114), as amended by Statement No. 118, Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosures (Statement
118). Under Statement 114, impaired loans are reported at the present
value of expected future cash flows at the loan's effective interest rate,
and the loan's observable market price or fair value of the collateral, if
the loan is collateral dependent. The impact of the adoption of Statements
114 and 118 was not material to the Bancorp.

On January 1, 1996, the Bancorp adopted Financial Accounting Standards
Board Statement No. 122, Accounting for Mortgage Servicing Rights, an
amendment to FASB Statement No. 65 (Statement 122). Statement 122 provides
guidance for the recognition of mortgage servicing rights as a separate
asset when servicing mortgage loans for others, regardless of how those
rights are acquired. Also, Statement No. 122 requires the measurement of
impairment of those servicing rights based upon the difference between the
carrying amount of the servicing rights and their current fair value with a
valuation allowance utilized to account for the difference. The impact of
the adoption of Statement 122 is not expected to be material to the
Bancorp.

INVESTMENT SECURITIES

(Continued)

F-25

192

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

Held-to-maturity securities are stated at amortized cost which represents
actual cost adjusted for amortization of premium and accretion of discount
using methods that generally approximate the effective interest method.
Available-for-sale securities are stated at fair value. Unrealized holding
gains and losses on available-for-sale securities, net of related taxes,
are excluded from earnings and reported as a separate component of
stockholders' equity until realized. A decline in the market value of any
available-for-sale or held-to-maturity security below cost, that is deemed
to be other than temporary, is charged to earnings. Gains or losses on the
sale of securities are recorded on a completed transaction basis using
specific identification and are reflected in the accompanying statements of
operations as part of other noninterest income.

A decline in the market value of any available-for-sale or held-to-maturity
security below cost that is deemed other than temporary is charged to
earnings, resulting in the establishment of a new cost basis for the
security. Dividend and interest income are recognized when earned.
Realized gains and losses for securities classified as available-for-sale
and held-to-maturity are included in earnings and are derived using the
specific identification method for determining the cost of securities sold.

TRUST ASSETS

Assets held by the Bancorp in fiduciary or agency capacity for customers
are not included in the consolidated financial statements as such are not
assets of Bancorp or its subsidiary. Fee income is recognized on an
accrual basis for financial reporting purposes.

PER SHARE DATA

Earnings per share are calculated by dividing net income by the weighted
average number of shares of common stock and common stock equivalents
outstanding during each period.

RECLASSIFICATION

Certain amounts in the prior years' financial statements have been
reclassified to conform to the current year presentation.

(2) SHORT-TERM DEBT

On December 30, 1993 the Bancorp entered into a revolving loan agreement
with an unaffiliated bank allowing the Bancorp to borrow up to $3,500,000.
This agreement was amended on June 30, 1995 to allow the Bancorp to borrow
up to $5,000,000. The loan is secured by 100% of the common stock of the
Bank. Borrowings under the agreement bear interest at the prime rate and
will be due quarterly. The final maturity date for the agreement is
December 31, 1996. At

(Continued)

F-26

193

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

December 31, 1995 and 1994, a total of $3,952,000 and $2,742,000,
respectively, had been drawn under the agreement. The Bank pays a 1/4 of
1% per annum commitment fee on amounts undrawn.

(3) INVESTMENT SECURITIES

The following table represents amortized cost, gross unrealized gains and
losses, and fair value for the investment securities held-to-maturity and
available-for-sale at December 31, 1995 and 1994. This table is by
contractual maturity which may differ from actual maturities because
borrowers may have the right to call or repay obligations with or without
call or prepayment penalties.

================================================================================

December 31, 1995
------------------------------------------
Gross Gross
Amortized unrealized unrealized Fair
cost gains losses value
- --------------------------------------------------------------------------------------
(in thousands)

Held-to-maturity -
U.S. Treasury - due
in one to five years $ 5,002 - (43) 4,959
- --------------------------------------------------------------------------------------
Total securities held-to-maturity 5,002 - (43) 4,959

- --------------------------------------------------------------------------------------

Available-for-sale:
Federal agencies - due in one
year or less 10,486 - (5) 10,481
Federal agencies - due in one
to five years 2,503 - (12) 2,491
Corporate notes - due in one
year or less 14,599 14 (3) 14,610
Corporate notes - due in one
to five years 4,032 17 (4) 4,045
Common stock - Hinsdale
Bancorp, Inc. 638 111 - 749
Common stock - North Shore
Community Bancorp, Inc. 648 200 - 848
Common stock - Libertyville
Bancorp, Inc. 350 - - 350
Federal Reserve Bank stock 316 - - 316
- --------------------------------------------------------------------------------------

Total securities available-for-sale 33,572 342 (24) 33,890
- --------------------------------------------------------------------------------------

Total investment securities $ 38,574 342 (67) 38,849
======================================================================================

(Continued)

F-27

194

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

========================================================================================

December 31, 1994
-------------------------------------------
Gross Gross
Amortized unrealized unrealized Fair
cost gains losses value
- ----------------------------------------------------------------------------------------
(in thousands)

Held-to-maturity:
U.S. Treasury - due
in one to five years $ 10,009 - (494) 9,515
Federal agencies -
due in one year or less 19,975 8 (228) 19,755
- ----------------------------------------------------------------------------------------
Total securities held-to-maturity 29,984 8 (722) 29,270
- ----------------------------------------------------------------------------------------

Available-for-sale:
Corporate notes - due in one
year or less 700 1 - 701
Corporate notes - due in one
to five years 4,208 19 (155) 4,072
Common stock - Hinsdale
Bancorp, Inc. 454 - - 454
Common Stock - North Shore
Community Bancorp, Inc. 400 - - 400
Federal Reserve Bank stock 290 - - 290
- ----------------------------------------------------------------------------------------

Total securities available-for-sale 6,052 20 (155) 5,917
- ----------------------------------------------------------------------------------------

Total investment securities $ 36,036 28 (877) 35,187
========================================================================================

During 1995 and 1994, the Bancorp had gross realized gains on sales of
investment securities classified as available-for-sale of $226 and $21,000,
respectively. During 1993, the Bancorp had gross realized gains on sales
of investment securities of $46,000 and gross realized losses of $23,000,
resulting in a net gain of $23,000. At December 31, 1995 and 1994,
investment securities having a carrying value of $20,982,000 and
$21,919,000, respectively, were pledged as collateral for securities sold
under agreement to repurchase, public deposits, and trust deposits.
Securities carried at $0 and $5,006,000 were sold under agreement to
repurchase at December 31, 1995 and 1994, respectively.

The Financial Accounting Standards Board's (FASB's) issuance of A Guide to
Implementation of Statement 115 on Accounting for Certain Investments in
Debt & Equity Securities permitted the transfer of securities from the
held-to-maturity classification to the available-for-sale classification
during the period from November 15, 1995 to December 31, 1995, with no
recognition of any related unrealized gain or loss in current earnings. On
December 29, 1995, the amortized cost and net unrealized gain of Bancorp's
portfolio of securities held-to-maturity transferred to the securities
available-for-sale classification was $32,428,000 and $318,000,
respectively.

(Continued)

F-28

195

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================
(4) LOANS

A summary of the loan portfolio by category at December 31, 1995 and 1994
is as follows:

================================================================================

1995 1994
- --------------------------------------------------------------------------------
(in thousands)

Commercial $ 52,811 31,852
Home equity 23,239 15,455
Residential 19,500 19,260
Installment 15,123 3,691
- --------------------------------------------------------------------------------

110,673 70,258
Less allowance for possible loan losses 938 642
- --------------------------------------------------------------------------------

$ 109,735 69,616
================================================================================

Certain officers and directors of Bancorp and its subsidiaries and certain
corporations and individuals related to such persons borrowed funds from
the Bank. These loans totaling $1,180,000 were made on substantially the
same terms, including interest rates and collateral, as those prevailing at
the time for comparable transactions with other borrowers.

(5) ALLOWANCE FOR POSSIBLE LOAN LOSSES

A summary of the changes in the allowance for possible loan losses for
years ending December 31, 1995, 1994, and 1993 is as follows:

================================================================================

1995 1994 1993
- --------------------------------------------------------------------------------
(in thousands)

Allowance at beginning of period $ 642 422 182
Provision 301 240 240
Charge-offs (5) (20) -
Recoveries - - -

- --------------------------------------------------------------------------------
Allowance at end of period $ 938 642 422
================================================================================

(Continued)

F-29

196

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

The provision for possible loan losses is charged to operations, and
recognized loan losses (recoveries) are charged (credited) to the allowance
for possible loan losses. At December 31, 1995, nonaccrual loans had a
carrying value of $150,000. There were no nonaccrual loans as of December
31, 1994. There were no material impaired loans as of and for the year
ended December 31, 1995.

(6) PREMISES AND EQUIPMENT, NET

A summary of premises and equipment at December 31, 1995 and 1994 is as
follows:

================================================================================

1995 1994
- --------------------------------------------------------------------------------

(in thousands)

Land $ 1,300 967
Buildings and improvements 5,884 5,144
Furniture and equipment 1,777 1,172
Construction in progress 16 379
- --------------------------------------------------------------------------------

8,977 7,662
Less accumulated depreciation and amortization 833 440
- --------------------------------------------------------------------------------

$ 8,144 7,222
===============================================================================

(7) TIME DEPOSITS

Certificates of deposit in amounts of $100,000 or more approximated
$42,835,000 and $29,957,000, respectively, at December 31, 1995 and 1994.
Interest expense related to these deposits approximated $1,442,000,
$859,000, and $294,000 for the periods ended December 31, 1995, 1994, and
1993, respectively.

(Continued)

F-30

197
LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements
==============================================================================

(8) LEASE EXPENSE AND OBLIGATIONS

Gross rental expense for all noncapitalized leases was $192,000, $133,000,
and 127,000 in 1995, 1994, and 1993, respectively. Rental income was
$141,000, $99,000 and $29,000 in 1995, 1994, and 1993, respectively.
Lease commitments are primarily for office space. Minimum gross rental
commitments as of December 31, 1995 for all noncancelable leases are as
follows:

================================================================================
(in thousands)

1996 $ 195
1997 201
1998 208
1999 215
2000 222
2001 and thereafter 550
- --------------------------------------------------------------------------------

Total minimum future rentals $1,591
================================================================================

Minimum gross rental income as of December 31, 1995 for all noncancelable
leases are as follows:

===============================================================================
(in thousands)

1996 $ 57
1997 8
1998 8
1999 2
2000 and thereafter -
- --------------------------------------------------------------------------------

Total minimum future rentals $ 75
================================================================================

(9) INCOME TAXES

The Bancorp had no Federal or state income tax expense in the each of the
years in the three-year period ended December 31, 1995. In 1995, the
Bancorp recorded a tax benefit of $172,199 as management determined that the
realization of certain deferred tax assets not previously valued was more
likely than not to occur.

(Continued)

F-31

198

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements
===============================================================================

Income taxes for 1995, 1994, and 1993 differ from the expected tax expense
for those years (computed by applying the applicable statutory U.S. Federal
income tax rate to income before income taxes) as follows:

==================================================================================
1995 1994 1993
- ----------------------------------------------------------------------------------
(in thousands)

Computed "expected" income tax expense $ 287 174 68
Decrease in tax resulting from:
Valuation allowance for deferred tax assets (454) (167) (68)
Other, net (5) (7) -

- -----------------------------------------------------------------------------------
Income tax benefit $(172) - -
===================================================================================

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at December
31, 1995 and 1994 are presented below:

=================================================================================
1995 1994
- ---------------------------------------------------------------------------------
(in thousands)

Deferred tax assets:
Allowance for possible loan losses $ 216 63
Startup costs 35 30
Deferred compensation 46 46
Federal net operating loss carryforward 406 621
State net operating loss carryforward 199 200
Unrealized loss on available-for-sale securities - 53
Other, net 12 6
- ---------------------------------------------------------------------------------

Total gross deferred tax assets 914 1,019
Valuation allowance - 454
- ----------------------------------------------------------------------------------

Total net deferred tax assets 914 565
- ----------------------------------------------------------------------------------

Deferred tax liabilities:
Premises and equipment, due to
differences in depreciation 164 71
Accrual to cash adjustment 565 446
Unrealized gain on available-for-sale securities 108 -
Other, net 68 48
- ---------------------------------------------------------------------------------

Total gross deferred tax liabilities 905 565
- ---------------------------------------------------------------------------------

Net deferred tax asset $ 9 -
==================================================================================

(Continued)

F-32

199

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

===============================================================================

The realization of deferred tax assets in 1994 was uncertain due to the
lack of an adequate earnings history for the Bancorp and the Bank. As a
result, in 1994, a valuation allowance had been established for the portion
of the gross deferred tax assets not offset by deferred tax liabilities.
In 1995, management believes it is more likely than not that the gross
deferred tax asset will be fully realized. Therefore, no valuation
allowance has been recorded as of December 31, 1995.

At December 31, 1995, Bancorp had federal net operating losses of
approximately $1,195,000, and state net operating losses of approximately
$2,763,000. Such amounts are available for carryforward to offset future
taxable income and expire in 2006-2010.

(10) COMPENSATION PLANS

Bancorp has a 1991 Stock Option Plan and a 1993 Stock Option Plan (Plans)
which provide options to purchase an aggregate of up to 37,865 shares of
Bancorp's common stock at the fair market value of the stock on the date
the option is granted. The Plans permit the grant of incentive stock
options, nonqualified stock options, and restricted stock. They cover
substantially all employees of Bancorp. The incentive and nonqualified
options expire at such time as the Stock Option Committee shall determine
at the time of grant; however, in no case shall they be exercisable later
than ten years after the grant. The options generally vest at a rate of 10%
in the first year subsequent to the grant, 10% in the second year
subsequent to the grant, and continue to vest 20% in the year in which the
Bank attains certain profitability levels, and 20% in the subsequent three
years, if Bancorp is profitable.

(Continued)

F-33

200

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

A summary of the activity in the Plans for 1995, 1994, and 1993 is as
follows:

=======================================================================
Common Range of
shares strike prices
- -----------------------------------------------------------------------

Outstanding at January 1, 1993 21,703 $61.00-70.00
Granted 11,649 75.00
Exercised - -
Forfeited or canceled - -
- -----------------------------------------------------------------------

Outstanding at December 31, 1993 33,352 61.00-75.00
Granted 3,330 75.00-90.00
Exercised 200 70.00
Forfeited or canceled 2,300 70.00
- -----------------------------------------------------------------------

Outstanding at December 31, 1994 34,182 61.00-90.00
Granted 2,600 90.00
Exercised 1,163 75.00
Forfeited or canceled 250 75.00-90.00
- -----------------------------------------------------------------------

Outstanding at December 31, 1995 35,369 $61.00-90.00
- -----------------------------------------------------------------------

Available for grant at December 31, 1995 1,133
=======================================================================

Bancorp also provides a 401(k) Retirement Savings Plan (401(k) Plan). The
plan covers all employees meeting certain eligibility requirements.
Contributions by employees are made through salary reductions at their
direction, limited to $9,240 annually. Employer contributions to the
401(k) Plan are made at the employer's discretion. Participants completing
501 hours of service are eligible to share in an allocation of employer
contributions. No employer contributions were made in 1995, 1994, or 1993.
In conjunction with the 1993 capital stock offering the Board of Directors
reserved 1,000 shares of common stock to be available for purchase by
401(k) Plan participants at $80 per share. During the years ended December
31, 1995 and 1994, 499 shares and 296 shares, respectively, were purchased
by plan participants. There were no shares purchased by plan participants
in 1993.

(Continued)

F-34

201

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

(11) REGULATORY RESTRICTIONS

Banking laws place restrictions upon the amount of dividends which can be
paid to Bancorp by the Bank. Based on these laws, the Bank could, subject
to minimum capital requirements, declare dividends to Bancorp without
obtaining regulatory approval in an amount not exceeding (a) undivided
profits, and (b) the amount of net income reduced by dividends paid for the
current and prior two years. No cash dividends were paid to Bancorp by the
subsidiary during the periods ended December 31, 1995, 1994, and 1993.

The Bank also is required by the Federal Reserve Act to maintain reserves
against deposits. Reserves are held either in the form of vault cash or
balances maintained with the Federal Reserve Bank and are based on average
daily deposit balances and statutory reserve ratios prescribed by the type
of deposit account. At December 31, 1995 and 1994 reserve balances of
approximately $1,112,000 and $552,000, respectively, were required.

(12) CAPITAL

During 1992 Bancorp issued and sold 7,333 of the 7,500 authorized preferred
convertible shares to certain employees. Each share of preferred stock is
convertible into 1.5 shares of common stock. To date, 5,633 preferred
shares have been converted into 8,450 common shares. At December 31, 1995
and 1994, the remaining 1,700 preferred convertible shares remain
outstanding.

(13) COMMITMENTS AND CONTINGENT LIABILITIES

Bancorp is subject to routine litigation arising in the normal course of
their business. In the opinion of management after consultation with legal
counsel, liabilities arising from these proceedings, if any, are not
expected to be material to Bancorp's financial position.

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

The Bancorp is a party to financial instruments with off-balance sheet risk
in the normal course of business to meet the financing needs of its
customers. These financial instruments are loan commitments to extend
credit and letters of credit. Those instruments involve, to varying
degrees, elements of credit risk in excess of amounts recognized in the
consolidated balance sheets. The contract amount of these instruments
reflects the extent of involvement the Bancorp has in these financial
instruments. The Bancorp's exposure to credit loss in the event of
nonperformance by the other party to the financial instruments for loan
commitments to extend credit and letters of credit is

(Continued)

F-35

202

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

represented by the contractual amounts of these instruments. The Bancorp
uses the same credit policies in making loan commitments as it does for
on-balance sheet loans. Financial instruments whose contract amounts
represent credit risk at December 31, 1995 are as follows:

================================================================================
(in thousands)

Commitments to extend credit $ 31,133
Letters of credit 174
================================================================================

Loan commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. Since many of the commitments
are expected to expire without being drawn upon, the total commitment
amounts do not necessarily represent future cash requirements. Collateral
held varies but may include residential real estate accounts receivable,
inventory, property, plant, and equipment, and income-producing commercial
properties.

Letters of credit written are conditional commitments issued by the Bancorp
to guarantee the performance of a customer to a third party and are subject
to the same credit review and approval process as loans.

(14) FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and estimated fair values
of Bancorp's financial instruments at December 31, 1995. Financial
Accounting Standards Board Statement No. 107, Disclosures about Fair Value
of Financial Instruments, defines the fair value of a financial instrument
as the amount at which the instrument could be exchanged in a current
transaction between willing parties.

(Continued)

F-36

203

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

==============================================================

Carrying Fair
value value
--------------------------------------------------------------
(in thousands)

Financial assets:
Cash and demand balances due from banks $3,680 3,680
Interest-bearing deposits at banks 21,100 21,100
Federal funds sold 13,100 13,100
Held-to-maturity securities 5,002 4,959
Available-for-sale securities 33,890 33,890
Loans 110,673 110,754
Allowance for possible loan losses (938) (938)
Accrued interest receivable 1,258 1,258

Financial liabilities:
Nonmaturity deposits 90,894 90,894
Deposits with stated maturities 90,292 90,784
Short-term debt 3,952 3,952
Treasury tax and loan 528 528
Accrued interest payable 339 339
==============================================================

Interest-bearing deposits at banks and securities: Fair values of these
instruments are based on quoted market prices of comparable assets.

For variable-rate loans that reprice frequently, estimated fair values are
based on carrying values. The fair value of residential real estate loans
is based on secondary market sources for securities backed by similar
loans, adjusted for differences in loan characteristics. The fair value
for other loans is estimated by discounting scheduled cash flows through
the estimated maturity using estimated market discount rates that reflect
the credit and interest rate inherent in the loan.

(Continued)

F-37

204

LAKE FOREST BANCORP, INC.
AND SUBSIDIARY

Notes to Consolidated Financial Statements

================================================================================

Deposit liabilities: The fair value of deposits with no stated maturity,
such as noninterest-bearing deposits, savings, NOW accounts, and money
market accounts, is equal to the amount payable on demand as of year-end
(i.e. the carrying value). The fair value of certificates of deposit is
based on the discounted value of contractual cash flows. The discount rate
is estimated using the rates currently in effect for deposits of similar
remaining maturities.

Short-term debt and treasury tax and loan: The carrying value of
short-term debt and treasury tax and loan accounts approximate fair value
due to the relatively short period of time to maturity or repricing.

Commitments to extend credit and standby letters of credit: The fair value
of commitments to extend credit is based on fees currently charged to enter
into similar arrangements, the remaining term of the agreement, the present
creditworthiness of the counterparty, and the difference between current
interest rates and committed interest rates on the commitments. Because
most of Bancorp's commitment agreements were recently entered into and/or
contain variable interest rates, the carrying value of Bancorp's
commitments to extend credit approximates fair value.

(15) EVENTS (UNAUDITED) SUBSEQUENT TO THE DATE OF THE REPORT OF THE
INDEPENDENT AUDITOR'S REPORT

The Board of Directors have approved a proposed Agreement and Plan of
Reorganization (Agreement) by and among Bancorp, North Shore Community
Bancorp, Inc., Hinsdale Bancorp, Inc., Libertyville Bancorp, Inc. and
Crabtree Capital Corporation (the Constituents) with North Shore Community
Bancorp, Inc. as the Resulting Corporation. As a part of the merger, North
Shore Community Bancorp, Inc. will be renamed to "WINTRUST FINANCIAL
CORPORATION" (WINTRUST). Pursuant to the Agreement, common stock of
WINTRUST will be exchanged for the outstanding shares of common stock of
the Constituents based upon exchange ratios specified in the Agreement.
The proposed transaction is contemplated to be accounted for as a pooling
of interests transaction and is subject to shareholder and regulatory
approval.

F-38
205
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders
of Hinsdale Bancorp, Inc. and Subsidiaries:

We have audited the accompanying consolidated statements of condition
of Hinsdale Bancorp, Inc. and subsidiaries (Bancorp) as of December 31,
1995 and 1994, and the related consolidated statements of operations,
changes in stockholders' equity, and cash flows for the years then
ended and the period from September 25, 1992 to December 31, 1993.
These consolidated financial statements are the responsibility of
Bancorp's management. Our responsibility is to express an opinion on
these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted
accounting standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
Hinsdale Bancorp, Inc. and subsidiaries as of December 31, 1995 and
1994, and the results of their operations and their cash flows for the
years then ended and the period from September 25, 1992 to December 31,
1993, in conformity with generally accepted accounting principles.

/s/ KPMG PEAT MARWICK LLP

March 1, 1996

F-39

206
HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Consolidated Statements of Condition

(in thousands, except share data)

================================================================================

December 31,
March 31, -------------------------------
ASSETS 1996 1995 1994
- ----------------------------------------------------------------------------------------------------------
(unaudited)

Cash and demand balances due from banks $ 1,612 3,048 1,308
Money market assets:
Interest-bearing deposits at banks -- 16,000 11,500
Federal funds sold 10,221 16,022 10,494
Investment securities:
Held-to-maturity, at amortized cost
(fair value of $17,220) -- -- 17,327
Available-for-sale, at fair value 32,440 15,409 --
Loans 67,505 58,085 22,327
Less allowance for possible loan losses 583 479 180
- ----------------------------------------------------------------------------------------------------------
Loans, net 66,922 57,606 22,147
Premises and equipment, net 5,085 5,941 3,155
Deferred organizational costs 76 84 116
Accrued interest receivable 929 824 267
Other assets 1,260 934 205
- ----------------------------------------------------------------------------------------------------------
Total assets $ 118,545 115,868 66,519
==========================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
- ----------------------------------------------------------------------------------------------------------
Deposits:
Noninterest-bearing 10,471 11,640 5,792
Interest-bearing 95,921 92,762 53,390
- ----------------------------------------------------------------------------------------------------------
Total deposits 106,392 104,402 59,182
Accrued interest payable 131 122 38
Term debt 1,800 1,600 --
Other liabilities 446 100 85
- ----------------------------------------------------------------------------------------------------------
Total liabilities 108,769 106,224 59,305
Stockholders' equity:
Common stock no par value; stated value of $1; 350,000
shares authorized; 207,137, 206,037, and 175,254 shares
issued and outstanding at March 31, 1996, December 31,
1995 and 1994, respectively 207 206 175
Common stock Series A warrants no par value; 5,000 warrants
authorized, issued, and outstanding 25 25 25
Common stock Series B warrants no par value; 5,000 warrants
authorized, issued and outstanding -- -- --
Surplus 9,506 9,452 7,483
Undivided profits (deficit) 19 (49) (469)
Net unrealized gain on securities available for sale,
net of tax 19 10 --
- ----------------------------------------------------------------------------------------------------------
Total stockholders' equity 9,776 9,644 7,214
- ----------------------------------------------------------------------------------------------------------
Total liabilities and stockholders' equity $ 118,545 115,868 66,519
==========================================================================================================

See accompanying notes to consolidated financial statements.

F-40
207
HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands, except per share data)

==========================================================================================================================
Three months Years ended Period ended
ended March 31, December 31, December 31,
------------------ ------------------ ------------
1996 1995 1995 1994 1993
- --------------------------------------------------------------------------------------------------------------------------
(unaudited)

Interest income:
Loan, including fees $ 1,356 554 3,701 862 1
Money market assets:
Interest-bearing deposits at banks 126 276 870 566 16
Federal funds sold 162 104 528 288 36
Investment securities 355 168 738 589 20
- --------------------------------------------------------------------------------------------------------------------------

Total interest income 1,999 1,102 5,837 2,305 73
- --------------------------------------------------------------------------------------------------------------------------

Interest expense:
Deposits 1,261 731 3,694 1,694 34
Term debt 34 13 76 38 32
- --------------------------------------------------------------------------------------------------------------------------

Total interest expense 1,295 744 3,770 1,732 66
- --------------------------------------------------------------------------------------------------------------------------

Net interest income 704 358 2,067 573 7

Provision for loan losses 104 60 299 180 --
- --------------------------------------------------------------------------------------------------------------------------

Net interest income after provision for loan losses 600 298 1,768 393 7
- --------------------------------------------------------------------------------------------------------------------------

Non interest income:
Fees on loans sold 99 44 305 124 --
Other 131 49 267 113 43
- --------------------------------------------------------------------------------------------------------------------------

Noninterest income 230 93 572 237 43
- --------------------------------------------------------------------------------------------------------------------------

Noninterest expense:
Salaries and other compensation 414 207 1,166 754 310
Occupancy 49 27 124 139 33
Advertising and marketing 22 13 116 71 44
Amortization of organizational costs 8 8 30 75 19
Data processing 53 32 151 88 19
Depreciation - furniture and equipment 34 17 94 58 8
Insurance 20 46 115 94 6
Other 162 77 464 244 176
- --------------------------------------------------------------------------------------------------------------------------

Total noninterest expense 762 427 2,260 1,523 615
- --------------------------------------------------------------------------------------------------------------------------

Net income (loss) before income taxes 68 (36) 80 (893) (565)
Income tax benefit -- -- 340 -- --
- --------------------------------------------------------------------------------------------------------------------------

Net income (loss) $ 68 (36) 420 (893) (565)
===========================================================================================================================

Earnings (loss) per share $ 0.31 (0.19) 2.04 (6.11) (12.55)
===========================================================================================================================

See accompanying notes to consolidated financial statements.

F-41
208

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders' Equity

(in thousands)

===================================================================================================================================
Net
unrealized
gain
on
Common Undivided securities Total
Common Preferred stock profits available stockholders'
stock stock warrants Surplus (deficit) for sale equity
- -----------------------------------------------------------------------------------------------------------------------------------

Initial capital contribution $ -- 500 25 1 -- -- 526

Common stock issuance 121 -- -- 5,922 -- -- 6,043

Capital issuance costs -- -- -- (24) -- -- (24)

Preferred stock dividend -- -- -- -- (11) -- (11)

Retirement of preferred stock 21 (500) -- 479 -- -- --

Allocation of undivided profits -- -- -- (1,000) 1,000 -- --

Net loss -- -- -- -- (565) -- (565)
- -----------------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1993 142 -- 25 5,378 424 -- 5,969

Common stock issuance 33 -- -- 2,105 -- -- 2,138

Net loss -- -- -- -- (893) -- (893)
- -----------------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1994 175 -- 25 7,483 (469) -- 7,214

Common stock issuance 31 -- -- 1,969 -- -- 2,000

Net income -- -- -- -- 420 -- 420

Change in unrealized
gain on securities
available-for-sale, net of tax
effect of $5 -- -- -- -- -- 10 10
- -----------------------------------------------------------------------------------------------------------------------------------

Balance at December 31, 1995 206 -- 25 9,452 (49) 10 9,644

Exercise of stock options 1 -- -- 54 -- -- 55

Net income -- -- -- -- 68 -- 68

Change in unrealized
gain on securities
available-for-sale, net of tax
effect of $3 -- -- -- -- -- 9 9
- -----------------------------------------------------------------------------------------------------------------------------------

BALANCE AT MARCH 31, 1996 (UNAUDITED) $ 207 -- 25 9,506 19 19 9,776
===================================================================================================================================

See accompanying notes to consolidated financial statements.

F-42
209
HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

===========================================================================================================================
Three months Year ended Period ended
ended March 31, December 31, December 31,
- ---------------------------------------------------------------------------------------------------------------------------
1996 1995 1995 1994 1993
- ---------------------------------------------------------------------------------------------------------------------------
(unaudited)

Operating activities:
Net income (loss) $ 68 (36) 420 (893) (377)
Adjustments to reconcile net loss to
net cash provided
by operating activities:
Depreciation 57 30 153 108 33
Amortization of deferred organizational
costs 8 8 32 75 --
Net amortization/(accretion) of investment
securities 23 48 86 (169) 5
Provision for loan losses 104 60 299 180 --
Deferred income tax benefit -- -- (340) -- --
Net changes in accrued interest receivable
and other assets (436) (426) (946) (237) 8
Net changes in other liabilities 355 51 94 (21) 106
- ---------------------------------------------------------------------------------------------------------------------------
Net cash provided by (used in) operating activities 179 (265) (202) (957) (225)
- ---------------------------------------------------------------------------------------------------------------------------
Investing activities:
Net increase in interest-bearing deposits at
banks 16,000 (11,500) (4,500) (4,500) (7,000)
Net increase in Federal funds sold 5,801 6,245 (5,528) (1,893) (8,601)
Maturities of investments 10,750 11,500 25,271 7,820 --
Purchase of investment in Federal Reserve
Bank stock -- -- (98) (20) (129)
Purchase of investment securities (27,790) (3,500) (23,326) (21,166) (3,702)
Purchase of premises and equipment (201) (1,762) (2,939) (568) (2,708)
Proceeds from sales of premises and equipment 1,000 -- -- -- --
Net increase in loans (9,420) (6,211) (35,758) (21,956) (338)
Other, net -- -- -- (131) (472)
- ---------------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (3,860) (5,228) (46,878) (42,414) (22,950)
- ---------------------------------------------------------------------------------------------------------------------------
Financing activities:
Net increase in deposits 1,990 3,104 45,220 42,370 16,812
Net proceeds from issuance of common stock 55 1,836 2,000 2,138 6,020
Proceeds from issuance of preferred stock -- -- -- -- 500
Preferred stock dividend -- -- -- -- (11)
Proceeds from issuance of convertible warrants -- -- -- -- 25
Proceeds from issuance of term debt 200 992 2,592 -- 1,400
Repayment of term debt -- -- (992) (900) (500)
- ---------------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities 2,245 5,932 48,820 43,608 24,246
- ---------------------------------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents (1,436) 439 1,740 237 1,071
Cash and cash equivalents at beginning of year 3,048 1,308 1,308 1,071 --
- ---------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year $ 1,612 1,747 3,048 1,308 1,071
===========================================================================================================================
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest $ 1,286 743 3,686 1,665 58
Income taxes -- -- -- -- --
===========================================================================================================================

See accompanying notes to consolidated financial statements.

F-43
210

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Hinsdale Bancorp, Inc. (Bancorp) was incorporated on September 25, 1992.
Hinsdale Bank & Trust Company (the Bank) is a wholly owned subsidiary of
Bancorp. The former Hinsdale Building Corporation (the Building
Corporation) and Hinsdale Building Corporation II (the Building Corp. II),
wholly owned subsidiaries of Bancorp, were merged into the Bancorp in June
1994 and December 1995, respectively. The net assets of the Building
Corporation and Building Corp. II were subsequently contributed from the
Bancorp to the Bank. The Bank commenced operations on October 27, 1993;
operating under an Illinois state banking charter, primarily in the
Hinsdale, Illinois area. The Building Corporation and the Building Corp.
II were incorporated for the purpose of purchasing land and banking
facilities for the Bank.

PREMISES AND EQUIPMENT

Premises and equipment are stated at cost less accumulated depreciation and
amortization. For financial reporting purposes depreciation and
amortization are computed using the straight-line method over the estimated
useful lives of the related assets ranging from five to ten years for
equipment and thirty-nine years for buildings. Additions to premises are
capitalized. Maintenance and repairs are charged to expense as incurred.

INCOME TAXES

The Bancorp files consolidated Federal and state income tax returns which
include the subsidiaries. The subsidiaries provide for income taxes on a
separate return basis and remit to Bancorp amounts determined to be
currently payable. Tax benefits attributable to losses are recognized and
allocated to the extent that such losses can be utilized in the
consolidated return.

F-44

211

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

DEFERRED ORGANIZATIONAL COSTS

Deferred organizational costs consist primarily of professional fees and
other start-up costs and are being amortized over 5 years.

CASH EQUIVALENTS

For purposes of the consolidated statement of cash flows, Bancorp considers
all cash on hand, cash items in the process of collection, and amounts due
from correspondent banks to be cash equivalents.

LOANS AND ALLOWANCE FOR POSSIBLE LOAN LOSSES

Loans are recorded at the principal amount outstanding. The allowance for
possible loan losses is maintained at a level adequate to provide for
potential loan losses. The Bank receives loan fees for loans originated by
the Bank, as well as for loan referrals. Fees associated with loans
originated by the Bank are deferred and amortized over the life of the
loans as an adjustment of yield using the straight-line method. Loan fees
for referrals are recognized as income when received.

On January 1, 1995, the Bancorp adopted Financial Accounting Standards
Board Statement No. 114, Accounting by Creditors for Impairment of a Loan
(Statement 114), as amended by Statement No. 118, Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosures (Statement
118). Under Statement 114, impaired loans are reported at the present
value of expected future cash flows at the loan's effective interest rate,
the loan's observable market price, or fair value of the collateral, if the
loan is collateral dependent. The impact of the adoption of Statements 114
and 118 was not material to the Bancorp.

INVESTMENT SECURITIES

(Continued)

F-45

212

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

Held-to-maturity securities are stated at amortized cost which represents
actual cost adjusted for amortization of premium and accretion of discount
using methods that generally approximate the effective interest method.
Available-for-sale securities are stated at fair value. Unrealized holding
gains and losses on available-for-sale securities, net of related taxes,
are excluded from earnings and reported as a separate component of
stockholders' equity until realized. A decline in the market value of any
available-for-sale or held-to-maturity security below cost, that is deemed
to be other than temporary, is charged to earnings. Gains or losses on the
sale of securities are recorded on a completed transaction basis using
specific identification and are reflected in the accompanying statements of
operations as part of other noninterest income.

PER SHARE DATA

Earnings per share is calculated by dividing net income by the weighted
average number of shares of common stock and applicable common stock
equivalents outstanding during each period.

RECLASSIFICATIONS

Certain amounts in the prior years' financial statements have been
reclassified to conform with current year presentation.

(2) TERM DEBT

In December, 1995 the Bancorp entered into a revolving loan agreement with
an unaffiliated bank allowing the Bancorp to borrow up to $3,000,000. The
loan is secured by 100% of the common stock of the Bank. Borrowings under
the agreement bear interest at the prime rate and will be due quarterly.
The final maturity date for the agreement is December 1, 1997. At December
31, 1995, $1,600,000 had been drawn under the agreement. The Bank pays a
1/4 of 1% per annum commitment fee on amounts undrawn.

(Continued)

F-46

213

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

During 1993, the Building Corporation borrowed $1,400,000 to purchase the
premises for the Bank. The debt was reduced to $900,000 as of December 31,
1993 and was retired in full concurrently with the merger of the Building
Corporation into Bancorp in June 1994.

In January 1995, the Building Corp. II borrowed approximately $992,000 for
constructing the premises of the Bank's drive-through facility. The debt
was retired in full in December, 1995.

(3) INVESTMENT SECURITIES

The following tables represent amortized cost, gross unrealized gains and
losses and fair value for the investment securities at December 31, 1995
and 1994. These tables are by contractual maturity which may differ from
actual maturities because borrowers may have the right to call or repay
obligations with or without call or prepayment penalties.

==========================================================================================
December 31, 1995
-----------------------------------------------
Gross Gross
Amortized unrealized unrealized Fair
cost gains losses value
- ------------------------------------------------------------------------------------------
(in thousands)

Available-for-sale:
U.S. Treasuries due in
one year or less $ 5,520 9 - 5,529
Federal Agencies -
due in one year or less 3,737 - (9) 3,728
Corporate notes - due in
one year or less 498 - - 498
Corporate notes - due in
one to five years 4,592 19 (4) 4,607
Common stock - Libertyville
Bancorp, Inc. 350 - - 350
Common stock - North Shore
Community Bancorp, Inc. 450 - - 450
Federal Reserve Bank stock 247 - - 247
- ------------------------------------------------------------------------------------------
$15,394 28 (13) 15,409
==========================================================================================

(Continued)

F-47

214

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

December 31, 1994
--------------------------------------------
Gross Gross
Amortized unrealized unrealized Fair
cost gains losses value
- -----------------------------------------------------------------------------------------
(in thousands)

Held-to-maturity
U.S. Treasuries due in
one year or less $ 587 - (3) 584
Federal Agencies -
due in one year or less 13,555 - (38) 13,517
Corporate notes - due in
one year or less 899 1 - 900
Corporate notes - due in
one to five years 2,137 31 (98) 2,070
Federal Reserve Bank stock 149 - - 149
- -----------------------------------------------------------------------------------------
$17,327 32 (139) 17,220
=========================================================================================

There were no sales of investment securities in 1995, 1994 and 1993 and,
accordingly, there were no realized gains or losses on sales of investment
securities. At December 31, 1995 and 1994, investment securities having a
carrying value of $8,258,000 and $5,640,000, respectively, were pledged as
collateral for public and other deposits.

(Continued)

F-48

215

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(4) LOANS

A summary of the loan portfolio by category at December 31, 1995 and 1994
is as follows:

==========================================================================
1995 1994
- --------------------------------------------------------------------------
(in thousands)

Commercial $21,165 9,503
Home equity 11,481 5,614
Residential 8,838 6,463
Installment 18,082 747
Unearned discount on installment loans (1,481) -
- --------------------------------------------------------------------------
$58,085 22,327
==========================================================================

Certain officers and directors of Bancorp and its subsidiaries and certain
corporations and individuals related to such persons incurred indebtedness
totaling $1,523,000 in the form of loans. These loans were made at
substantially the same terms, including interest rates and collateral, as
those prevailing at the time for comparable transactions with other
borrowers.

(5) ALLOWANCE FOR POSSIBLE LOAN LOSSES

A summary of the changes in the allowance for possible loan losses for the
years ending December 31, 1995 and 1994 and the period from September 25,
1992 (date of incorporation) to December 31, 1993 is as follows:

==========================================================================
1995 1994 1993
- --------------------------------------------------------------------------
(in thousands)

Allowance at beginning of period $180 - -
Provision 299 180 -
Charge-offs - - -
Recoveries - - -
- --------------------------------------------------------------------------
Allowance at end of period $479 180 -
==========================================================================

(Continued)

F-49
216

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

The provision for loan losses is charged to operations. At December 31,
1995 and 1994, nonaccrual loans were $15,000 and $-0-, respectively. The
Bancorp had no impaired loans as of and for the year ended December 31,
1995.

(6) PREMISES AND EQUIPMENT, NET

A summary of premises and equipment at December 31, 1995 and 1994 is as
follows:

========================================================================
1995 1994
- ------------------------------------------------------------------------
(in thousands)

Land $1,743 644
Building and improvements 3,646 1,892
Furniture and equipment 812 438
Construction in progress 14 302
- ------------------------------------------------------------------------
6,215 3,276
Less accumulated depreciation and amortization 274 121
- ------------------------------------------------------------------------
$5,941 3,155
========================================================================

Bancorp leases space to various tenants under short-term operating leases,
all but one of which will expire in 1996.

(7) TIME DEPOSITS

Certificates of deposit in amounts of $100,000 or more approximated
$26,604,000 and $6,900,000 at December 31, 1995 and 1994, respectively.
Interest expense related to certificates of deposit in amounts of $100,000
or more approximated $707,000 and $80,000 for the years ended December 31,
1995 and 1994, respectively, and $3,000 for the period ended December 31,
1993.

(8) INCOME TAXES

The Bancorp had no Federal or state income tax expense in the years ended
December 31, 1995 and 1994 and the period ended December 31, 1993. In
1995, the Bancorp recorded a tax benefit of $340,000 as management
determined that the realization of deferred tax assets not previously
valued was more likely than not.

(Continued)

F-50

217

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

Income tax benefit for the periods ended December 31, 1995, 1994 and 1993,
differed from the amount computed by applying the expected Federal income
tax rate of 34% to pretax income from operations as a result of the
following:

================================================================================================
1995 1994 1993
- ------------------------------------------------------------------------------------------------
(in thousands)

Computed "expected" tax expense (benefit) $ 27 (304) (128)
Increase (decrease) in income taxes resulting from:
Valuation allowance for deferred tax assets (315) 303 128
Other (52) 1 -
- ------------------------------------------------------------------------------------------------
Federal income tax benefit $ (340) - -
================================================================================================

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and deferred tax liabilities at
December 31, 1995 and 1994 are presented below:

================================================================================================
1995 1994
- ------------------------------------------------------------------------------------------------

Deferred tax assets:
Organizational costs $110 52
Book loan loss provision in excess of tax provision 16 -
Federal tax, net operating loss carryforward 691 679
State tax, net operating loss carryforward 170 155
Other 11 3
- ------------------------------------------------------------------------------------------------

Total gross deferred tax assets 998 889

Less valuation allowance 201 516
- ------------------------------------------------------------------------------------------------

Net deferred tax assets 797 373

Deferred tax liabilities:
Tax loan loss provision in excess of book provision - 63
Premises and equipment, due to differences in depreciation 46 31
Accrual to cash adjustment 363 243
Unrealized gain on available-for-sale securities 6 -
Other 42 36
- ------------------------------------------------------------------------------------------------

Total gross deferred tax liabilities 457 373
- ------------------------------------------------------------------------------------------------

Net deferred tax assets $340 -
================================================================================================

(Continued)

F-51
218

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

During 1994, realization of deferred tax assets was uncertain due to the
lack of an adequate earnings history for the Bancorp and subsidiaries. As
a result, in 1994, a valuation allowance was established for the portion of
the gross deferred tax assets not offset by deferred tax liabilities.
During 1995, management determined that a valuation allowance should only
be established for a portion of the deferred tax asset. This determination
was made based upon the profitability attained by the Bank during 1995 and
future earnings estimates for 1996. As such, management established a
valuation allowance of approximately $201,000.

At December 31, 1995, Bancorp had Federal net operating losses of
approximately $2,033,000, and state net operating losses of approximately
$2,369,000. Such amounts are available for carryforward to offset future
taxable income and expire in 2008-2010.

(9) COMPENSATION PLANS

Effective October 28, 1993, Bancorp, as approved by the stockholders on
December 29, 1993, adopted a Stock Option Plan (Plan) which provides
options to purchase an aggregate of up to 25,000 shares of Bancorp's common
stock at the fair market value of the stock on the date the option is
granted. The Plan permits the grant of incentive stock options,
nonqualified stock options, and restricted stock. It covers certain key
employees of Bancorp. The incentive and nonqualified options expire at
such time as the Stock Option Committee shall determine at the time of
grant, however, in no case shall they be exercisable later than ten years
after the grant. These options generally vest 10% in the first year
subsequent to the grant, 10% in the second year subsequent to the grant,
20% in the year in which the Bancorp attains certain profitability levels,
and 20% in each year thereafter.

(Continued)

F-52

219

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

A summary of the activity in the Plan for the years ended December 31, 1995
and 1994 and the period ended December 31, 1993 is as follows:

=======================================================================
Strike
Common price
shares range
- -----------------------------------------------------------------------

Outstanding at December 31, 1993 - -
Granted 16,925 $50.00
Exercised or canceled - -
- -----------------------------------------------------------------------

Outstanding at December 31, 1994 16,925 $50.00
Granted 4,650 $65.00
Exercised or canceled - -
- -----------------------------------------------------------------------

Outstanding at December 31, 1995 21,575 $50.00-$65.00
- -----------------------------------------------------------------------

Available for grant 3,425
=======================================================================

In December, 1995, the Board of Directors approved the granting of 10,550
additional common stock options to employees and directors of the Company.
The grants are subject to the approval of the stockholders to increase the
number of authorized shares under the Plan by 15,000 to accommodate such
grants. Stockholder approval was requested in March 1996 and is pending
final vote.

Bancorp also provides a 401(k) Retirement Savings Plan (401(k) Plan). The
401(k) Plan covers all employees meeting certain eligibility requirements.
Contributions by employees are made through salary reductions at their
direction, limited to $9,240 annually. Employer contributions to the
401(k) Plan are made at the employer's discretion. Participants completing
501 hours of service are eligible to share in an allocation of employer
contributions. No employer contributions were made in 1995, 1994, or 1993.

(10) REGULATORY RESTRICTIONS

Banking laws place restrictions upon the amount of dividends which can be
paid to Bancorp by the Bank. Based on these laws, the Bank is not
permitted to pay dividends until such time as previous operating losses
have been recovered through earnings. No cash dividends were paid to
Bancorp by the Bank during the periods ended December 31, 1995, 1994 and
1993.

(Continued)

F-53

220

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

The Bank is required to maintain a 9% of capital to asset ratio for three
years as a de novo Bank.

(11) STOCKHOLDERS' EQUITY

Bancorp was incorporated on September 25, 1992 and initially capitalized
through the issuance of 20 no par common shares at $50 each; 10,000 no par
preferred convertible shares at $50 each; 5,000 no par common stock Series
A warrants at $5 each. Each Series A warrant entitles the holder to
acquire one share of common stock at a purchase price of $50.

Subsequent to the initial capitalization, Bancorp raised an additional
$6,042,827 through the private placement issuance of 120,834 no par common
shares.

During the initial period of operations, Bancorp allocated $1,000,000 of
the initial surplus to undivided profits to cover initial operating
expenditures.

The Hinsdale Bancorp, Inc. 1993 Recapitalization Plan, as approved by the
shareholders, provided for the redemption of the 10,000 convertible,
preferred shares of Bancorp stock currently outstanding in a like kind
exchange for common stock and the issuance of additional common stock
warrants. The preferred shares were held primarily by officers and
employees of the Bancorp who contributed significantly to the organization,
capitalization and opening of the Bank.

2.15 shares of common stock were exchanged for each preferred share
outstanding. The 10,000 preferred shares outstanding were exchanged for
21,500 common shares of the Bancorp common stock. The preferred stock
received was retired by the Bancorp.

The Bancorp also authorized and issued an additional 5,000 common stock
Series B warrants. Each Series B warrant entitles the holder to acquire
one share of the Bancorp's common stock at a price of $31.50 per share.
The warrants have a ten year life and were issued to the holders of the
preferred stock.

Because of growth, during 1994, the Bancorp authorized the issuance of
additional shares of common stock at $65 per share. This issuance of
63,683 shares resulted in proceeds of approximately $4,100,000. Of the
63,683 shares sold, 32,900 shares were sold in 1994 and the remaining
30,783 were sold in 1995.

(Continued)

F-54

221

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(12) COMMITMENTS AND CONTINGENT LIABILITIES

Bancorp is subject to routine litigation arising in the normal course of
their business. In the opinion of management after consultation with legal
counsel, liabilities arising from these proceedings, if any, are not
expected to be material to Bancorp's financial position.

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

Financial instruments whose contract amounts represent credit risk at
December 31, 1995 are as follows:

================================================================================
1995
- --------------------------------------------------------------------------------
(in thousands)

Commitments to extend credit $16,389
Letters of credit 2,201
================================================================================

Loan commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any condition established in the contract.
Commitments generally have fixed expiration dates or other termination
clauses and may require payment of a fee. Since many of the commitments
are expected to expire without being drawn upon, the total commitment
amounts do not necessarily represent future cash requirements. Collateral
held varies but may include residential real estate accounts receivable,
inventory, property, plant, and equipment, and income-producing commercial
properties.

Letters of credit written are conditional commitments issued by Bancorp to
guarantee the performance of a customer to a third party and are subject to
the same credit review and approval process as loans.

(Continued)

F-55

222

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

(13) FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and estimated fair values
of Bancorp's financial instruments at December 31, 1995. Financial
Accounting Standards Board Statement No. 107, Disclosures about Fair Value
of Financial Instruments, defines the fair value of a financial instrument
as the amount at which the instrument could be exchanged in a current
transaction between willing parties.

- ---------------------------------------------------------------------
Carrying Fair
Value Value
- ---------------------------------------------------------------------

Financial assets:
Cash and demand balances due from banks $ 3,048 3,048
Interest-bearing deposits at banks 16,000 16,000
Federal funds sold 16,022 16,022
Available-for-sale securities 15,409 15,409
Loans 58,085 58,134
Allowance for possible loan losses (479) (479)
Accrued interest receivable 824 824
- ---------------------------------------------------------------------

Financial liabilities:
Non-maturity deposits 55,505 55,505
Deposits with stated maturities 48,897 49,217
Term debt 1,600 1,600
Accrued interest payable 122 122
=====================================================================

Interest-bearing deposits at banks and securities: Fair values of these
instruments are based on quoted market prices of comparable assets.

For variable-rate loans that reprice frequently, estimated fair values are
based on carrying values. The fair value of residential real estate loans
is based on secondary market sources for securities backed by similar
loans, adjusted for differences in loan characteristics. The fair value
for other loans is estimated by discounting scheduled cash flows through
the estimated maturity using estimated market discount rates that reflect
the credit and interest rate inherent in the loan.

(Continued)

F-56

223

HINSDALE BANCORP, INC.
AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

- --------------------------------------------------------------------------------

Deposit liabilities: The fair value of deposits with no stated maturity,
such as non-interest bearing deposits, savings, NOW accounts and money
market accounts, is equal to the amount payable on demand as of year-end
(i.e. the carrying value). The fair value of certificates of deposit is
based on the discounted value of contractual cash flows. The discount rate
is estimated using the rates currently in effect for deposits of similar
remaining maturities.

Term debt: The carrying value of term debt approximates fair value due to
the relatively short period of time to maturity or repricing.

Commitments to extend credit and standby letters of credit: The fair
value of commitments to extend credit is based on fees currently charged to
enter into similar arrangements, the remaining term of the agreement, the
present creditworthiness of the counterparty, and the difference between
current interest rats and committed interest rates on the commitments.
Because most of Bancorp's commitment agreements were recently entered into
and/or contain variable interest rates, the carrying value of Bancorp's
commitments to extend credit approximates fair value.

(14) EVENTS (UNAUDITED) SUBSEQUENT TO THE DATE OF THE REPORT OF THE
INDEPENDENT AUDITOR'S REPORT

The Board of Directors have approved a proposed Agreement and Plan of
Reorganization (Agreement) by and among Bancorp, North Shore Community
Bancorp, Inc., Lake Forest Bancorp, Inc., Libertyville Bancorp, Inc. and
Crabtree Capital Corporation (the Constituents) with North Shore Community
Bancorp, Inc. as the Resulting Corporation. As a part of the merger, North
Shore Community Bancorp, Inc. will be renamed to "WINTRUST FINANCIAL
CORPORATION" (WINTRUST). Pursuant to the Agreement, common stock of
WINTRUST will be exchanged for the outstanding shares of common stock of
the Constituents based upon exchange ratios specified in the Agreement.
The proposed transaction is contemplated to be accounted for as a pooling
of interests transaction and is subject to shareholder and regulatory
approval.

F-57
224

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and
Stockholders of Libertyville
Bancorp, Inc. and Subsidiaries:

We have audited the accompanying consolidated statement of condition of
Libertyville Bancorp, Inc. and subsidiaries (Bancorp) as of December
31, 1995 and the related consolidated statements of operations, changes
in shareholders' equity, and cash flows for the period September 26,
1994 (date of incorporation) to December 31, 1995. These financial
statements are the responsibility of Bancorp's management. Our
responsibility is to express an opinion on these financial statements
based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
Libertyville Bancorp, Inc. as of December 31, 1995 and the results of
their operations and their cash flows for the period September 26, 1994
(date of incorporation) to December 31, 1995 in conformity with
generally accepted accounting principles.

/s/ KPMG PEAT MARWICK LLP

March 8, 1996

F-58

225

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Condition

(in thousands, except share data)

=============================================================================================================
MARCH 31, DECEMBER 31,
- -------------------------------------------------------------------------------------------------------------
ASSETS 1996 1995
- -------------------------------------------------------------------------------------------------------------
(unaudited)

Cash and demand balances due from banks $ 642 1,753
Money market assets:
Interest-bearing deposits at banks 9,000 6,500
Federal funds sold 11,285 14,690
Securities available-for-sale
Federal agencies 3,988 --
Federal Reserve Bank stock 150 150
Other securities 450 450
Loans 22,311 10,189
Less allowance for loan losses 130 55
- -------------------------------------------------------------------------------------------------------------

Loans, net 22,181 10,134

Premises and equipment, net 4,064 3,498
Deferred organization costs 101 107
Other assets 681 197
- -------------------------------------------------------------------------------------------------------------

Total assets $ 52,542 37,479
- -------------------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY
- -------------------------------------------------------------------------------------------------------------

Deposits:
Noninterest-bearing 7,282 3,728
Interest-bearing 35,293 22,685
- -------------------------------------------------------------------------------------------------------------
Total deposits 42,575 26,413

Accrued interest payable 68 46
Notes payable 361 1,064
Treasury tax and loan 71 339
Other liabilities 80 64
- -------------------------------------------------------------------------------------------------------------
Total liabilities 43,155 27,926

Shareholders' equity: 500 500
Preferred stock, Series B, no par value, 25,000 shares
authorized, 24,000 shares issued and outstanding
Common stock, no par value; stated value $1 per share;
350,000 shares authorized; 205,929 and 201,689
shares issued and outstanding at March 31, 1996
and December 31, 1995, respectively 206 202
Convertible warrants, Series A, no par value, 5,000 shares
authorized, issued and outstanding 25 25
Convertible warrants, Series B, no par value, 20,000 warrants
authorized; 15,760 and 20,000 warrants issued and outstanding at
March 31, 1996 and December 31, 1995, respectively -- --
Surplus 8,994 8,829
Undivided profits (deficit) (338) (3)
- -------------------------------------------------------------------------------------------------------------
Total shareholders' equity 9,387 9,553
- -------------------------------------------------------------------------------------------------------------
Total liabilities and shareholders# equity $ 52,542 37,479
=============================================================================================================

See accompanying notes to consolidated financial statements.

F-59
226

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

(in thousands)

Three
months Period
ended ended
March 31, December 31,
1996 1995
- -----------------------------------------------------------------------------------------------
(unaudited)

Interest income:
Loans, including fees $ 328 73
Money market assets:
Interest-bearing deposits at banks 107 80
Federal funds sold 171 166
Investment securities 39 2
- -----------------------------------------------------------------------------------------------
Total interest income 645 321
- -----------------------------------------------------------------------------------------------
Interest expense:
Deposits 393 141
Notes payable 23 23
- -----------------------------------------------------------------------------------------------
Total interest expense 416 164
- -----------------------------------------------------------------------------------------------
Net interest income 229 157

Provision for loan losses 75 55
- -----------------------------------------------------------------------------------------------
Net interest income after provision for loan losses 154 102
- -----------------------------------------------------------------------------------------------
Noninterest income:
Fees on loans sold 49 14
Other income 8 7
- -----------------------------------------------------------------------------------------------
Total noninterest income 57 21
- -----------------------------------------------------------------------------------------------
Noninterest expense:
Salaries and other compensation 300 514
Net occupancy 41 46
Advertising and marketing 18 127
Amortization of organization costs 6 6
Data processing 29 16
Depreciation - furniture and equipment 33 27
Stationery and supplies 15 95
Other 104 250
- -----------------------------------------------------------------------------------------------
Total noninterest expense 546 1,081
- -----------------------------------------------------------------------------------------------
Net loss $ (335) (958)
- -----------------------------------------------------------------------------------------------
Loss per share $ (1.64) (14.19)
===============================================================================================

See accompanying notes to consolidated financial statements.

F-60
227

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Changes in Stockholders# Equity

(in thousands)

- ----------------------------------------------------------------------------------------------------------------------------
Preferred Preferred Convertible Convertible
Common stock, stock, Period warrants,
stock Series A Series B Series A Series B Surplus
- ----------------------------------------------------------------------------------------------------------------------------

Initial capital contribution $ 1 500 -- 25 -- --

Dividends -- -- -- -- -- --

Initial offering 201 -- -- -- -- 8,829

Conversion of preferred stock
and issuance of convertible
warrants -- (500) 500 -- -- --

Conversion of Series B
warrants into common stock 4 -- -- -- -- 165

Net loss -- -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------
Balance at March 31, 1996 (unaudited) $ 206 -- 500 25 -- 8,994
============================================================================================================================

- ----------------------------------------------------------------------
Undivided Total
profits stockholders'
(deficit) equity
- ----------------------------------------------------------------------

Initial capital contribution -- 526

Dividends (45) (45)

Initial offering 1,000 10,030

Conversion of preferred stock
and issuance of convertible
warrants -- --

Net loss (958) (958)
- ----------------------------------------------------------------------
Balance at December 31, 1995 (3) 9,553

Conversion of Series B
warrants into common stock -- 169

Net loss (335) (335)
- ----------------------------------------------------------------------
Balance at March 31, 1996 (unaudited) (338) 9,387
======================================================================

See accompanying notes to consolidated financial statements.

F-61

228

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(in thousands)

- -------------------------------------------------------------------------------------------------------
Three
months Period
ended ended
March 31, December 31,
1996 1995
- -------------------------------------------------------------------------------------------------------
(unaudited)

Operating activities:
Net loss $ (335) (958)
Adjustments to reconcile net loss to net cash used in
operating activities:
Provision for loan losses 75 55
Depreciation 56 45
Amortization of organization costs 6 6
Accretion of investment securities (39) --
Increase in accrued interest receivable and other assets (484) (310)
Increase in accrued interest payable and other liabilities 38 110
- -------------------------------------------------------------------------------------------------------
Net cash used in operating activities (683) (1,052)
- -------------------------------------------------------------------------------------------------------
Investing activities:
Net increase in interest-bearing deposits at banks (2,500) (6,500)
Net decrease (increase) in Federal funds sold 3,405 (14,690)
Purchase of investment in Federal Reserve Bank stock -- (150)
Purchases of available-for-sale securities (8,949) (450)
Maturities of available-for-sale securities 5,000 --
Purchase of premises and equipment (622) (3,543)
Net increase in loans, net (12,122) (10,189)
- -------------------------------------------------------------------------------------------------------
Net cash used in investing activities (15,788) (35,522)
- -------------------------------------------------------------------------------------------------------
Financing activities:
Net increase in deposits 16,162 26,413
Net (decrease) increase in treasury tax and loan (268) 339
Proceeds from issuance of common stock 169 10,030
Proceeds from issuance of notes payable -- 1,770
Repayment of notes payable (703) (706)
Dividends paid -- (45)
- -------------------------------------------------------------------------------------------------------
Net cash provided by financing activities 15,360 37,801
- -------------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents (1,111) 1,227
Cash and cash equivalents at beginning of period 1,753 526
- -------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of period $ 642 1,753
- -------------------------------------------------------------------------------------------------------
Supplemental disclosures of cash flow information -
cash paid during the period for:
Interest $ 394 118
Income taxes -- --
- -------------------------------------------------------------------------------------------------------

See accompanying notes to consolidated financial statements.

F-62

229

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995
- --------------------------------------------------------------------------------

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Libertyville Bancorp, Inc. (Bancorp), was incorporated on September 26,
1994. Libertyville Bank and Trust Company (Bank) and Libertyville Building
Corporation (Building Corporation) are subsidiaries of Bancorp. The Bank
commenced operations on October 10, 1995, operating under an Illinois state
banking charter, primarily in the Libertyville, Illinois area. The
Building Corporation's primary asset is the current banking premises for
the Bank.

The consolidated financial statements of Bancorp and its wholly-owned
subsidiaries have been prepared in conformity with generally accepted
accounting principles and prevailing practices of the banking industry.
All material intercompany accounts and transactions have been eliminated in
the consolidated financial statements.

PREMISES AND EQUIPMENT

INCOME TAXES

(Continued)
F-63

230

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

ORGANIZATION COSTS

Organization costs consist primarily of professional fees and other
start-up costs and are being amortized over five years.

CASH EQUIVALENTS

For purposes of the consolidated statement of cash flows, Bancorp considers
all cash on hand, cash items in the process of collection, and amounts due
from correspondent banks to be cash equivalents.

LOANS AND ALLOWANCE FOR LOAN LOSSES

Loans are recorded at the principal amount outstanding. The allowance for
loan losses is maintained at a level adequate to provide for potential loan
losses. The Bank receives loan fees for loans originated by the Bank, as
well as for loan referrals. Fees associated with loans originated by the
Bank are deferred and amortized over the life of the loans as an adjustment
of yield using the interest method. Loan fees for referrals are recognized
as income when received.

On October 10, 1995, Bancorp adopted Financial Accounting Standards Board
Statement No. 114, Accounting by Creditors for Impairment of a Loan
(Statement 114), as amended by Statement No. 118, Accounting by Creditors
for Impairment of a Loan - Income Recognition and Disclosure (Statement
118). Under Statement 114, impaired loans are reported at the present
value of expected future cash flows at the loan's effective interest rate,
the loan's observable market price, or fair value. The impact of the
adoption of Statements 114 and 118 was not material to the Bancorp.

INVESTMENT SECURITIES

Investment securities are accounted for by applying the provisions of
Statement of Financial Accounting Standards No. 115, Accounting of Certain
Investments in Debt and Equity Securities (Statement 115). Under Statement
115, the Bank can classify securities in one of three categories:
trading, held-to-maturity, or available-for-sale. Trading securities are
bought principally for the purpose of selling them in the near term.
Held-to-maturity securities are those securities in which the Bank has the
ability and intent to hold the security until maturity. All other
securities are classified as available-for-sale as they may be sold prior
to maturity. In accordance with Statement 115, the Bancorp has elected to
classify all investments as available-for-sale. The investment securities
classified as available-for-sale are accounted for at fair market value.

(Continued)
F-64

231

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

Trading account securities are stated at fair value. Trading account gains
and losses from closing positions and from changes in market values of the
trading inventory are reflected in the accompanying statement of income as
part of noninterest income. Bancorp did not maintain any trading account
securities in 1995.

(2) NOTES PAYABLE

The Bancorp and subsidiaries borrowed $1,770,000 to fund the purchase of
real estate and to cover initial start-up expenses. This debt was paid
down to $1,064,000 at December 31, 1995, primarily with proceeds Bancorp
received through the issuance of common shares in the private placement
offering (see note 10). On January 5, 1996, this debt was reduced by
$700,000. The remaining note bears interest at 9.0% per annum and matures
on July 1, 1999.

(3) INVESTMENT SECURITIES

The following table represents carrying amounts, gross unrealized gains
and losses and fair value for the investment securities at December 31,
1995. All securities were classified as available-for-sale securities at
December 31, 1995.

- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
Gross Gross
Amortized unrealized unrealized Fair
cost gains losses value
- --------------------------------------------------------------------------------
(in thousands)

Federal Reserve Bank stock $150 - - 150
Common stock - North Shore
Community Bancorp, Inc. 450 - - 450
- --------------------------------------------------------------------------------
Total securities available for sale $600 - - 600
================================================================================

There were no sales of investment securities in 1995 and accordingly, there
were no realized gains or losses on sales of investment securities. There
were no pledged securities at December 31, 1995.

F-65
232

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

(4) LOANS

A summary of the loan portfolio by category at December 31, 1995 is as
follows:
- --------------------------------------------------------------------------------
(in thousands)

Commercial $ 6,526
Installment 2,733
Home equity 751
Residential 179
- --------------------------------------------------------------------------------
$10,189
================================================================================

Certain officers and directors of Bancorp and its subsidiaries and certain
corporations and individuals related to such persons incurred indebtedness
totaling approximately $429,000 in the form of loans from the Bank. These
loans were made on substantially the same terms, including interest rates
and collateral, as those prevailing at the time for comparable transactions
with other borrowers.

(5) PREMISES AND EQUIPMENT

A summary of premises and equipment at December 31, 1995 is as follows:
- --------------------------------------------------------------------------------
(in thousands)

Land $ 450
Buildings and improvements 2,468
Furniture and equipment 626
- --------------------------------------------------------------------------------
3,544
Less accumulated depreciation and amortization 46
- --------------------------------------------------------------------------------
$3,498
================================================================================

(6) TIME DEPOSITS

Certificates of deposit in amounts of $100,000 or more approximated
$4,110,000 at December 31, 1995. Interest expense related to these
deposits approximated $36,000 for the period ended December 31, 1995.

(Continued)
F-66

233

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

(7) INCOME TAXES

The Bancorp has no Federal or state income tax expense for 1995. Bancorp
has Federal and state net operating loss carryforwards, which expire in
2010, of approximately $750,000. The realization of such deferred tax
assets in future years is uncertain due to the lack of an adequate earnings
history. As a result, a valuation allowance has been recognized for the
portion of the net operating loss carryforwards not offset by deferred tax
liabilities.

Income tax expense (benefit) for the year ended December 31, 1995 differed
from the amount computed by applying the Federal income tax rate of 34% to
pretax income from operations as a result of the following:
- --------------------------------------------------------------------------------
(in thousands)

Computed "expected" tax expense (benefit) $ (326)
Increase in income taxes resulting from:
Valuation allowance on deferred tax assets 370
Other (44)
- --------------------------------------------------------------------------------
$ -
================================================================================

The tax effects of temporary differences that give rise to significant
portions of the deferred tax assets and liabilities at December 31, 1995
are presented below:
- --------------------------------------------------------------------------------

(in thousands)

Deferred tax assets:
Federal, net operating loss carryforward $ 255
State, net operating loss carryforward 54
Start-up and organization costs 166
Other, net 5
- --------------------------------------------------------------------------------
Total gross deferred tax assets 480

Less - valuation allowance 370
- --------------------------------------------------------------------------------
Total net deferred tax assets 110
- --------------------------------------------------------------------------------
Deferred tax liabilities:
Tax loan loss deduction in excess of book 49
Accrual-to-cash adjustment 38
Other, net 23
- --------------------------------------------------------------------------------
Total gross deferred tax liabilities 110
- --------------------------------------------------------------------------------
Net deferred tax assets $ -
================================================================================

(Continued)
F-67

234

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995
- --------------------------------------------------------------------------------

(8) COMPENSATION PLANS

Effective November 21, 1995, upon shareholder approval, Bancorp adopted
a Stock Option Plan (Plan) which provides options to purchase an aggregate
of up to 32,000 shares of Bancorp's common stock at the fair market value
of the stock on the date the option is granted. The Plan permits the
grant of incentive stock options, nonqualified stock options, and
restricted stock. It covers certain key employees of Bancorp. The
incentive and nonqualified options expire at such time as the Stock Option
Committee shall determine at the time of grant; however, in no case shall
they be exercisable later than ten years after the grant. Bancorp has
granted a total of 20,700 options at $50 per share. These options vest
10% in 1996, 10% in 1997, 20% in the year in which the Bank attains
certain profitability levels, and 20% in each year thereafter.

(9) REGULATORY RESTRICTIONS

Banking laws place restrictions upon the amount of dividends which can
be paid to Bancorp by the subsidiaries. Based on these laws, the Bank is
not permitted to pay dividends until such time as any previous operating
losses have been recovered through earnings. No cash dividends were paid
to Bancorp by the subsidiaries during the period ended December 31, 1995.

The Bank is also required to maintain a 9% of capital to asset ratio
for three years as a de novo Bank.

The Bank is required by the Federal Reserve Act to maintain reserves
against deposits. Reserves are held either in the form of vault cash or
balances maintained with the Federal Reserve Bank and are based on average
daily deposit balances and statutory reserve ratios prescribed by the type
of deposit account. At December 31, 1995 reserve balances of
approximately $25,000 were required.

(10) SHAREHOLDERS' EQUITY

Bancorp was incorporated on September 26, 1994 and initially
capitalized through the issuance of 1,000 no par common shares at $1 each;
10,000 no par preferred convertible shares at $50 each; and 5,000 no par
common stock series A warrants at $5 each. Each series A warrant entitles
the holder to acquire one share of common stock at a purchase price of
$50.

Subsequent to the initial capitalization, Bancorp raised an additional
$10,030,000 through the private placement issuance of 200,689 no par common
shares. During the initial period of operations, Bancorp allocated
$1,000,000 of the initial surplus to undivided profits to cover initial
operating expenditures.

(Continued)
F-68

235

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995
- --------------------------------------------------------------------------------

Subsequent to the private placement of the 200,689 shares of common shares,
the shareholders approved the Libertyville Bancorp, Inc. 1995
Recapitalization Plan (Plan) which provided for the exchange of the 10,000
existing shares of preferred convertible stock for new preferred shares and
common stock warrants. Under the Plan, the existing preferred shareholders
received 2.4 shares of new Series B Preferred stock and two Series B Common
Stock Warrants for each share of existing preferred shares held. As such,
subsequent to the Plan, 24,000 Series B Preferred Shares and 20,000 Series
B Common Stock Warrants are outstanding.

The Series B Common Stock Warrants have a ten year life. Each warrant
entitles the holder to purchase one share of the Common Stock at a purchase
price of $40 per share.

The Series B Preferred Stock is non-voting and will not pay dividends for a
period of at least ten years from issuance and thereafter, dividends, if
any, will not be cumulative. Each share of Series B Preferred Stock is
convertible into one share of Common Stock.

(11) COMMITMENTS AND CONTINGENT LIABILITIES

Bancorp is subject to routine litigation arising in the normal course of
their business. In the opinion of management after consultation with legal
counsel, liabilities arising from these proceedings, if any, are not
expected to be material to Bancorp's financial position.

FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

The Bancorp's exposure to credit loss in the event of nonperformance by the
other party to the financial instruments for loan commitments to extend
credit and letters of credit is represented by the contractual amounts of
these instruments. The Bancorp uses the same credit policies in making
loan commitments as it does for on-balance sheet loans.

Financial instruments whose contract amount represent credit risk at
December 31, 1995 are as follows:
- --------------------------------------------------------------------------------
(in thousands)

Commitments to extend credit $ 2,370
Letters of credit -
- --------------------------------------------------------------------------------

Loan commitments to extend credit are agreements to lend to a customer as
long as there is no violation of any condition established in the contract.
Commitments generally have a fixed

(Continued)
F-69

236

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

expiration date or other termination clauses and may require payment of a
fee. Since many of the commitments are expected to expire without being
drawn upon, the total commitment amounts do not necessarily represent
future cash requirements. Collateral held on these instruments varies, but
may include residential real estate, accounts receivable, inventory,
property, plant and equipment and income-producing commercial properties.

(12) FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table presents the carrying amounts and estimated fair
values of Bancorp's financial instruments at December 31, 1995. Financial
Accounting Standards Board Statement No. 107, Disclosures about Fair Value
of Financial Instruments, defines the fair value of a financial instrument
as the amount at which the instrument could be exchanged in a current
transaction between willing parties.
- --------------------------------------------------------------------------------

Carrying Fair
value value
- --------------------------------------------------------------------------------
(in thousands)

Financial assets:
Cash and demand balances due from banks $1,753 1,753
Interest-bearing deposits at banks 6,500 6,500
Federal funds sold 14,690 14,690
Available-for-sale securities 600 600
Loans 10,189 10,205
Allowance for loan losses (55) (55)
Accrued interest receivable 89 89
================================================================================
Financial liabilities:
Non-maturity deposits $11,131 11,131
Deposits with stated maturities 15,282 15,511
Notes payable 1,064 1,064
Treasury, tax and loan 339 339
Accrued interest payable 46 46
- -===============================================================================

(Continued)
F-70

237

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995
- --------------------------------------------------------------------------------

Interest-bearing deposits at banks and securities: Fair values of these
instruments are based on quoted market prices, when available. If quoted
market prices are not available, fair values are based on quoted market
prices of comparable assets.

For variable-rate loans that reprice frequently, estimated fair values are
based on carrying values. The fair value of residential real estate loans
is based on secondary market sources for securities backed by similar
loans, adjusted for differences in loan characteristics. The fair value
for other loans is estimated by discounting scheduled cash flows through
the estimated maturity using estimated market discount rates that reflect
the credit and interest rate inherent in the loan.

Deposit liabilities: The fair value of deposits with no stated maturity,
such as non-interest bearing deposits, savings, NOW accounts and money
market accounts, is equal to the amount payable on demand as of year-end
(i.e. the carrying value). The fair value of certificates of deposit is
based on the discounted value of contractual cash flows. The discount rate
is estimated using the rates currently in effect for deposits of similar
remaining maturities.

Notes payable and treasury, tax and loan: The carrying value of notes
payable and treasury tax and loan accounts approximate fair value due to
the relatively short period of time to maturity or repricing.

Commitments to extend credit and standby letters of credit: The fair value
of commitments to extend credit is based on fees currently charged to enter
into similar arrangements, the remaining term of the agreement, the present
creditworthiness of the counterparty, and the difference between current
interest rates and committed interest rates on the commitments. Because
most of Bancorp's commitment agreements were recently entered into and/or
contain variable interest rates, the carrying value of Bancorp's
commitments to extend credit approximates fair value.

F-71

238

LIBERTYVILLE BANCORP, INC. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

December 31, 1995

- --------------------------------------------------------------------------------

(13) EVENTS (UNAUDITED) SUBSEQUENT TO THE DATE OF THE REPORT OF THE
INDEPENDENT AUDITOR'S REPORT

The Board of Directors have approved a proposed Agreement and Plan of
Reorganization (Agreement) by and among Bancorp, Hinsdale Bancorp, Inc.,
Lake Forest Bancorp, Inc., North Shore Community Bancorp, Inc. and
Crabtree Capital Corporation (the Constituents) with North Shore Community
Bancorp, Inc. as the Resulting Corporation. As a part of the merger,
North Shore Community Bancorp, Inc. will be renamed to "WINTRUST FINANCIAL
CORPORATION" (WINTRUST). Pursuant to the Agreement, common stock of
WINTRUST will be exchanged for the outstanding shares of common stock of
the Constituents based upon exchange ratios specified in the Agreement.
The proposed transaction is contemplated to be accounted for as a pooling
of interests transaction and is subject to shareholder and regulatory
approval.

F-72
239
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors of
Crabtree Capital Corporation:

We have audited the accompanying consolidated balance sheets of CRABTREE
CAPITAL CORPORATION (an Illinois corporation) AND SUBSIDIARIES as of December
31, 1995 and 1994, and the related consolidated statements of income,
stockholders' equity and cash flows for each of the three years ended December
31, 1995. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Crabtree Capital
Corporation and Subsidiaries as of December 31, 1995 and 1994, and the results
of their operations and their cash flows for each of the three years ended
December 31, 1995, in conformity with generally accepted accounting principles.

As explained in Note 2 to the financial statements, the Company has given
retroactive effect to the change in accounting for the consolidation of First
Premium Funding Corporation and the recording of compensation expense related
to the issuance of permanent discount stock under the 1990 Stock Purchase Plan.

ARTHUR ANDERSEN LLP

Chicago, Illinois

May 20, 1996

F-73

240
CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(000'S OMITTED)

DECEMBER 31
ASSETS MAR.31,1996 1995 1994
- --------------------------------------------------------- ------------ -------- -------
(UNAUDITED)

ASSETS:
Cash and cash equivalents $ 585 $ 369 $ 768
Finance receivables (Note 5)-
Premium finance 6,365 7,979 93,349
Facility overcollateralization 6,950 6,630 0
Equipment leases 329 388 614
Other receivables (Note 14) 1,094 1,094 0
------------ -------- --------
Total finance receivables 14,738 16,091 93,963
Residual value of leased equipment 14 37 67
Less-
Unearned finance income and advance payments (188) (283) (2,251)
Allowance for losses on finance receivables (788) (851) (830)
------------ -------- --------
Net finance receivables 13,776 14,994 90,949
Sales gain receivable (Note 3) 1,441 1,316 0
Prepaid and other assets 461 355 2,750
Property and equipment, net of accumulated
depreciation of $603, $535 and $392 in 1996,
1995 and 1994, respectively 1,007 609 639
Deferred financing fees, net of accumulated
amortization of $2,127, $1,836 and $1,076 in
1996, 1995 and 1994, respectively 170 461 943
Funds held in escrow 724 724 724
Net assets of discontinued operations, net
of minority interest of $1,704 in 1994 (Note
4) 0 0 1,875
------------ -------- --------
Total assets $ 18,164 $ 18,828 $ 98,648
============ ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Accounts payable and accrued expenses $ 8,825 $ 11,716 $ 8,914
Notes and loans payable 4,400 2,150 2,200
Subordinated notes payable 1,999 1,992 1,963
Other liabilities 70 70 1,573
Commercial paper notes payable 0 0 82,980
------------ -------- --------
Total liabilities 15,294 15,928 97,630
------------ -------- --------

MINORITY INTEREST IN FIRST PREMIUM SERVICES, INC. 212 212 212

STOCKHOLDERS' EQUITY:
Common stock, $1 par value; 2,000,000 shares
authorized; 1,032,266 shares issued and
outstanding 1,032 1,032 1,032
Additional paid-in capital 17,971 17,971 17,971
Accumulated deficit (16,180) (16,150) (18,032)
Less- Treasury stock, at cost; 7,000 shares (165) (165) (165)
------------ -------- --------
Total stockholders' equity 2,658 2,688 806
------------ -------- --------
Total liabilities and stockholders' equity $ 18,164 $ 18,828 $ 98,648
============ ======== ========

The accompanying notes to consolidated financial statements
are an integral part of these balance sheets.

F-74

241
CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(000'S OMITTED)

THREE MONTHS FOR THE YEARS ENDED
ENDED MARCH 31 DECEMBER 31
---------------- --------------------------
1996 1995 1995 1994 1993
------ -------- ------ -------- -------
(UNAUDITED)

REVENUES:
Finance charges-
Premium finance $ 372 $1,273 $2,535 $8,233 $ 4,297
Equipment leases 22 30 12 38 126
Gain on sale of receivables (Note 3) 967 1,616 4,421 0 0
Servicing fees 324 175 1,083 0 0
Gain on retirement of minority interest
shares (Note 4) 0 0 735 0 0
Other 29 4 333 564 318
------ -------- ------ -------- -------
Total revenues 1,714 3,098 9,119 8,835 4,741
------ -------- ------ -------- -------
EXPENSES:
Interest expense 182 645 1,248 4,032 1,879
Provision for losses on finance receivables 42 89 347 137 887
Commercial paper facility expense 0 88 88 737 442
Operating expenses-
Salary and wages 640 650 2,859 2,583 2,047
Professional fees (Note 16) 80 80 301 281 409
Occupancy 249 196 832 760 567
Deferred financing fee amortization 194 182 768 641 511
Other 357 295 777 383 780
------ -------- ------ -------- -------
Total operating expenses 1,520 1,403 5,537 4,648 4,314
------ -------- ------ -------- -------
Total expenses 1,744 2,225 7,220 9,554 7,522
------ -------- ------ -------- -------
Income (loss) from continuing operations
before income taxes (30) 873 1,899 (719) (2,781)
Income taxes (Note 8) 0 0 0 0 0
------ -------- ------ -------- -------
Income (loss) from continuing operations (30) 873 1,899 (719) (2,781)
Income (loss) from operations of
discontinued subsidiaries, net of minority
interest of $75, $180 and ($112) in 1995,
1994 and 1993, respectively 0 (3) (17) (236) (193)
------ -------- ------ -------- -------
NET INCOME (LOSS) $ (30) $ 870 $1,882 $ (955) $(2,974)
====== ======== ====== ======== =======
EARNINGS PER SHARE DATA:
Earnings (loss) per common share from
continuing operations $ (.03) $ .85 $ 1.85 $ (.70) $ (2.71)
Earnings (loss) per common share from
discontinued operations - - (.02) (.23) (.19)
------ -------- ------ -------- -------
Net income (loss) $ (.03) $ .85 $ 1.83 $ (.93) $ (2.90)
====== ======== ====== ======== =======

The accompanying notes to consolidated financial statements
are an integral part of these statements.

F-75

242

CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993

AND THREE MONTHS ENDED MARCH 31, 1996 (UNAUDITED)

(000'S OMITTED)

NOTES RECEIVABLE
FROM OFFICERS
ADDITIONAL FROM SALE OF ACCUMULATED TREASURY
COMMON STOCK PAID-IN CAPITAL COMMON STOCK DEFICIT STOCK TOTAL
------------ --------------- ---------------- ----------- -------- --------

BALANCE, DECEMBER 31, 1992 $1,032 $17,971 $(202) $(14,103) $(165) $ 4,533
Net loss 0 0 0 (2,974) 0 (2,974)
Payments of notes receivable from
officer from sale of common stock 0 0 144 0 0 144
------ ------- ------ -------- ------ --------
BALANCE, DECEMBER 31, 1993 1,032 17,971 (58) (17,077) (165) 1,703
Net loss 0 0 0 (955) 0 (955)
Payments of notes receivable from
officer from sale of common stock 0 0 58 0 0 58
------ ------- ------ -------- ------ --------
BALANCE, DECEMBER 31, 1994 1,032 17,971 0 (18,032) (165) 806
Net income 0 0 0 1,882 0 1,882
------ ------- ------ -------- ------ --------
BALANCE, DECEMBER 31, 1995 $1,032 17,971 0 (16,150) (165) 2,688
Net loss (unaudited) 0 0 0 (30) 0 (30)
------ ------- ------ -------- ------ --------
BALANCE, MARCH 31, 1996 (UNAUDITED) $1,032 $17,971 $ 0 $(16,180) $(165) $ 2,658
====== ======= ====== ======== ====== ========

The accompanying notes to consolidated financial statements are an integral
part of these statements.

F-76

243
CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993

AND THREE MONTHS ENDED MARCH 31, 1996 (UNAUDITED)

(000'S OMITTED)

DECEMBER 31
--------------------------------------

MAR. 31, 1996 1995 1994 1993
------------- -------- ----------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES: (UNAUDITED)

Net income (loss) from continuing operations $ (30) $ 1,899 $ (719) $ (2,781)
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities-
Depreciation and amortization expense 365 943 783 679
Provision for losses on finance receivables 42 347 137 887
Gain on retirement of minority interest shares 0 (735) 0 0
Net changes in assets and liabilities-
Increase (decrease) in unearned finance charges (199) (1,968) 807 542
Increase (decrease) in accounts payable and accrued expenses (6,013) 2,802 7,240 (700)
Increase (decrease) in other liabilities 3,226 (1,504) (1,176) 838
Decrease (increase) in sales gain receivable (125) (1,316) 0 0
Decrease (increase) in prepaid and other assets (106) 2,395 (1,254) 1,195
Increase in amortized discount on commercial paper 0 0 107 226
Net loss of discontinued operations 0 (17) (236) (193)
Decrease in net assets of discontinued operations 0 1,875 666 734
------- --------- ----------- ---------
Net cash provided by (used in) operating activities (2,840) 4,721 6,355 1,427
------- --------- ----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Premium finance receivables originated or purchased (75,125) (301,852) (247,551) (157,342)
Premium finance receivables repaid or sold 76,697 385,913 217,692 115,730
Purchase of equipment for lease 0 0 0 (29)
Equipment lease receivable payments, excluding interest 19 147 476 775
Increase in facility overcollateralization (320) (6,631) 0 0
Decrease in restricted funds 0 0 0 202
Purchase of property and equipment, net (465) (145) (170) (476)
Gain on retirement of minority interest shares 0 735 0 0
------- --------- ----------- ---------
Net cash provided by (used in) investing activities 806 78,167 (29,553) (41,140)
------- --------- ----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes and loans payable 2,250 250 400 1,350
Repayment of notes and loans payable 0 (300) (200) (14,800)
Committed capital 0 0 0 (1,500)
Issuance of subordinated notes 0 0 0 1,500
Deferred financing fees 0 (257) 0 (335)
Decrease in notes receivable from officers from sale of common stock 0 0 58 144
Commercial paper notes originated 0 310,040 1,051,245 566,107
Commercial paper notes principal repaid 0 (393,020) (1,027,677) (514,557)
------- --------- ----------- ---------
Net cash provided by (used in) financing activities 2,250 (83,287) 23,826 37,909
------- --------- ----------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 216 (399) 628 (1,804)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 369 768 140 1,944
------- --------- ----------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 585 $ 369 $ 768 $ 140
======= ========= =========== =========

The accompanying notes to consolidated financial statements are an integral
part of these statements.
F-77

244
CRABTREE CAPITAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1995 AND 1994

1. DESCRIPTION OF BUSINESS

Crabtree Capital Corporation ("Crabtree") was organized on September
10, 1979, and adopted its present name on August 12, 1985. Crabtree was
inactive until late 1985.

Crabtree is a financial services holding company engaged primarily in
the business of financing the payment of insurance premiums through its
majority-owned subsidiary, First Premium Services, Inc. ("First Premium").
Crabtree has a small amount of residual business from subsidiaries which
involves primarily the run off of a small amount of lease receivables and
the settlement of certain litigation and contingency issues remaining with
the inactive insurance holding company subsidiary.

First Premium is a financial services company engaged in the business
of financing the payment of insurance premiums. First Premium offers
financing of approximately 80% of an insurance premium to individuals and
commercial purchasers of property and casualty and liability insurance who
wish to pay their insurance premiums on an installment basis. First
Premium is licensed or otherwise qualified to do business as an insurance
premium finance company in 38 states. Virtually, all of First Premium's
outstanding receivables are commercial accounts.

2. CHANGE IN BASIS OF PRESENTATION

Prior to 1995, the consolidated financial statements of Crabtree did
not include the financial position or the results of operations of First
Premium Funding Corporation, a company sponsored and controlled by First
Premium. As more fully described in Note 5, First Premium Funding
Corporation, independently owned and nominally capitalized by First
Premium, operated as a special-purpose corporation for the sole purpose of
purchasing premium finance receivables from First Premium. Management has
retroactively restated prior years to include the financial position and
results of operations of First Premium Funding Corporation.

As described in Note 11, two senior officers of Crabtree purchased
60,000 shares of stock at $5 per share, a $20 discount, in 1990 under the
1990 Stock Purchase Plan. The prior-year financial statements of Crabtree
did not include any compensation expense related to the issuance of these
discounted shares. Management has restated prior years to give
retroactive effect to recording $1.2 million of compensation expense
related to the issuance of these discounted shares.

F-78

245

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies:

A. BASIS OF CONSOLIDATION

The accompanying consolidated financial statements consolidate Crabtree
and its subsidiaries (the "Company"), Prospect Leasing Company
("Prospect") and First Premium (including First Premium Funding
Corporation). During 1990, management put in place a strategy to
discontinue its insurance operations. Therefore, the operations of The
Credit Life Companies, Inc. ("CLC") are accounted for as discontinued
operations (see Note 4). In 1992, Prospect sold substantially all of
its leasing portfolio and is in the process of collecting the remaining
balance while not originating any new receivables. All material
intercompany balances have been eliminated. In certain instances, the
1994 and 1993 amounts have been reclassified to conform to the 1995
method of presentation.

B. FINANCE REVENUE

Finance charges on premium finance receivables are earned over the term
of the loan based on actual funds outstanding, beginning with the
funding date, using a method which approximates the effective yield
actuarial method. Late charges are recognized as income when they are
received.

Income is recognized on leasing contracts under the direct finance
method of accounting. Under this method, the combined amount of the
aggregate rentals and the anticipated residual value in excess of the
cost of the equipment is recorded as unearned income. Unearned income
is reflected as revenue over the term of the lease contract using a
method which approximates a constant periodic rate of return on the net
investment in the lease.

C. PROPERTY AND EQUIPMENT

Property and equipment are depreciated over their estimated useful lives
which range from three to ten years. Leasehold improvements are
amortized over the remaining life of the lease terms.

D. LOAN SALES AND SERVICING RIGHTS

Beginning in February, 1995, First Premium began selling its premium
finance receivables to a wholly owned subsidiary, First Premium
Financing Corporation ("FPFIN") which in turn sells the receivables to
an independent third party, Holland Limited Securitization, Inc. ("HLS")
for cash. FPFIN is a bankruptcy remote subsidiary established to
facilitate the sale to HLS. First Premium retains servicing rights in
connection with the sales of receivables. As set forth in a Sale and
Servicing Agreement between First Premium and HLS, First Premium earns
1.25% annually of the net investment outstanding as of the last
settlement date, as defined, in connection with the ongoing servicing
and management of the receivables. First Premium recognizes the 1.25%
contractual servicing and management fee income over the term of the
receivables as it is earned. In addition, any excess income earned by
HLS above that which is

F-79
246

required to fund interest on its outstanding commercial paper and
provide for normal servicing to First Premium is payable as additional
servicing ("Excess Servicing"). Excess Servicing income over the
expected life of the receivables sold is estimated by First Premium at
the time of each sale and recorded as a sales gain receivable on the
books of First Premium. The total gain on receivables sold recorded by
First Premium during the year ended December 31, 1995, was $4,421,000.
In its capacity as servicer, First Premium collects payments on
receivables sold and remits the collections to HLS. Amounts received
by First Premium, as servicer, on sold receivables at year-end that have
not yet been remitted to HLS represent $1,844,282 at December 31, 1995.
Prior to February, 1995, First Premium sold its receivables to its
subsidiary, First Premium Funding Corporation.

E. INCOME TAXES

The Company, excluding CLC, files a consolidated federal income tax
return. The method of allocation among the companies is based upon
separate return calculations with current credit for net losses, if
applicable. Intercompany tax balances are settled upon final
determination of the consolidated income tax liability for the
applicable year. Deferred income taxes are provided for temporary
differences between financial statement income and income reported for
tax purposes.

The Company uses the liability method of accounting for income taxes.
Under this method, deferred income taxes are provided for the tax
consequences of temporary differences by applying enacted statutory tax
rates applicable to future years to differences between the tax and
financial statement bases of assets and liabilities. The effect on
deferred taxes of change in tax rates is recognized in income in the
period that includes the enactment date.

F. DEFERRED INITIAL DIRECT COSTS

First Premium is required to defer initial direct costs of originating
loans in accordance with Statement of Financial Accounting Standards No.
91. In 1995 and 1994, no such costs were deferred since the effect on
the financial statements was not material.

G. CASH FLOWS

For purposes of cash flows, cash and cash equivalents represent cash in
banks and short-term investments purchased with a maturity of three
months or less.

H. EARNINGS PER SHARE

Earnings per share were computed for income from continuing operations
and income from discontinued operations based on the weighted average
number of common stock equivalents outstanding during the year. Common
stock equivalents were calculated using the treasury stock method.
Because no active market for the company's stock exists, estimates of
market value were used to determine the dilutive effects of outstanding
stock options. These options were determined not to have a dilutive
effect on earnings per share.

F-80
247

I. USE OF ESTIMATES

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.

J. UNAUDITED QUARTERLY FINANCIAL INFORMATION

The unaudited quarterly financial information has been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in annual
financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and
regulations. In the opinion of management, all adjustments necessary
for a fair presentation for the periods presented have been reflected
and are of a normal and recurring nature. Results of operations for the
interim periods are not necessarily indicative of the results to be
expected for the year.

4. DISCONTINUANCE OF INSURANCE OPERATIONS

During 1990, management adopted a plan to discontinue its insurance
operations. These operations were carried out through Crabtree's then
57%-owned subsidiary, CLC. The management of CLC also adopted a plan to
sell or liquidate all of its operating subsidiaries.

F-81
248

The net assets of the discontinued operations, net of minority interest, are
comprised of the following as of December 31, 1995 and 1994 (000's omitted):

1995 1994
---- ----

Assets-
Cash $ 4 $ 17
Restricted funds 197 2,744
Investments 76 448
Tax settlement proceeds receivable 0 1,978
Investment in and advances to/from subsidiaries 50 32
Other assets 1 68
---- ----
328 5,287
---- -----
Liabilities-
Accounts payable and accrued expenses 328 1,263
Federal income taxes payable 0 88
---- -----
328 1,351
---- -----
Net assets before intercompany balances and minority interest 0 3,936
Minority interest 0 (1,704)
---- -----
Net assets before intercompany balances 0 2,232
Intercompany balances 0 (357)
---- -----
Net assets $ 0 $ 1,875
==== =======

Restricted funds in 1995 relates primarily to amounts deposited in trust to
retire minority interest shares. Restricted funds in 1994 relates to cash
proceeds received by CLC for the sale of the Credit Life Insurance Company,
Inc. ("Credit Life"). The proceeds were placed in escrow pending resolution
of certain contingencies which were settled in February, 1995.

In September, 1990, CLC sold its credit life insurance subsidiary, Credit
Life. As of the date of sale of Credit Life, taxes and interest receivable
of $933,000 from the IRS were recorded. CLC indemnified
the purchaser against any loss related to these issues, including collection
of this receivable and related interest and taxes. In conjunction with an
IRS settlement, Credit Life received partial payments in 1994 and 1993 of
$772,000 and $306,000, respectively, and a final payment of $2,554,000 in
January, 1995. These proceeds were used first to satisfy the purchaser's
receivable and the remaining amount of $1,978,000 was remitted to CLC by the
purchaser in February, 1995. As a result of the settlement, CLC recorded an
additional gain of $653,000 in 1994.

In conjunction with the sale of Credit Life, CLC made certain
representations and warranties to the purchaser. The purchaser presented
CLC with notices seeking indemnification for items totaling approximately
$7.2 million, principally related to an alleged breach of the
representations and warranties concerning the fair presentation of financial
statements provided to the purchaser. CLC vigorously disputed all of the
claims made by the purchaser. In February, 1995, both parties reached an
out of court settlement that satisfied all disputed claims made by the
purchaser. As a result of this settlement, the purchaser received $700,000

F-82
249

of funds held in escrow while CLC received the remaining amount of escrow
funds of $1,912,000. CLC incurred a loss of $477,000 related to this
settlement for the year ended December 31, 1994.

In December, 1992, the shareholders of CLC adopted a formal plan of
liquidation for CLC. The assets and liabilities of CLC are stated at
approximate liquidation values. Net future costs of liquidation have been
recorded.

The 1987 purchase agreement for CLC provided for additional contingent
consideration pending the outcome of certain tax litigation and other
contingencies of CLC. The provisions of the purchase agreement operated to
mitigate the negative impact on Crabtree's recorded income of adverse
settlements of such CLC contingencies up to $6,900,000 (net of any favorable
settlements). Settlements in excess of that amount would have negatively
impacted Crabtree's income to the extent of its ownership share. If such
contingencies were favorably resolved, Crabtree would have been required to
contribute up to $3,450,000 to CLC. Additional consideration of $1,680,000
was accrued at the date of acquisition. Further, up to $1,770,000 of
additional consideration was contingently due which, if paid, would result
in an additional capital contribution to CLC. Any net amounts which could
be paid under this obligation were fully accrued in the financial statements
through December 31, 1994. In early 1995, the last remaining contingency
under the purchase agreement was satisfied and in March, 1995, CLC made a
formal request to Crabtree for the maximum amount of the contribution.
Crabtree disputed the amounts owed and in September, 1995, Crabtree reached
a settlement agreement with CLC.

Under the terms of the settlement agreement, Crabtree effectively bought out
the minority shareholders of CLC by having CLC repurchase all of its stock
held by the minority shareholders. A purchase price was negotiated which
included a deemed capital contribution by Crabtree of $1.7 million. As a
result of this settlement, Crabtree recorded a gain of approximately
$735,000.

In 1990, Credit General Insurance Company ("Credit General"), a former
subsidiary of CLC filed suit against an insurance agent to recover losses
incurred by Credit General relating to an inappropriate transaction by the
agent. Additionally, in 1995, CLC filed an amendment to its 1982 tax return
seeking a refund of past taxes paid. The minority shareholders and Crabtree
will share in, if and when received by CLC, amounts received as a result of
the outcome of the above-mentioned litigation and tax refund.

CLC is also currently in negotiation with several reinsurance companies
which are attempting to collect reinsurance monies owed them from various
CLC subsidiaries. Pursuant to the sales agreement, Credit Life has funds in
escrow pending resolution of these matters.

As of December 31, 1995, one of these insurance companies, which is
currently in liquidation, stated they were owed $526,000 from Credit Life
for claim payments under reinsurance arrangements. Credit Life had funds
deposited in escrow related to this contingency of $544,000 at December 31,
1995. Subsequent to year-end, Credit Life negotiated a settlement with the
company for $300,000.

F-83
250

In 1995, CLC's captive insurance company, CL Re, received a request from the
issuing carrier of their reinsurance arrangement for payment of $230,000 for
final refunds and claim payments. CLC has accrued approximately this amount
at December 31, 1995. The Company is currently negotiating this amount.

5. SECURITIZATION FACILITY

Prior to February, 1995, First Premium sold its receivables to a
special-purpose corporation called First Premium Funding Corporation
("FPFC"). FPFC was nominally capitalized by a third party and sponsored by
First Premium to facilitate the issuance of commercial paper and purchase of
receivables from First Premium. Pursuant to a Sales and Servicing Agreement
between First Premium and FPFC, FPFC had engaged First Premium to provide
certain administrative services related to the servicing of its loans and
provided that First Premium be compensated as the Servicer. First Premium
also was performing all other administrative functions of FPFC, such as cash
management and accounting services, pursuant to a management agreement. As
noted in Note 2, due to the nature of the relationship between First Premium
and FPFC, the financial statements have been restated to include the
consolidated results of operations and financial position of FPFC.

In 1993, Internationale Netherlanden Bank, N.V. ("ING") became the credit
enhancer for commercial paper issued by FPFC. ING continued to provide
temporary liquidity to FPFC. The interest rate charged on any borrowing on
the liquidity line would be the higher of prime or the federal funds rate
plus 1/2%.

As an incentive for ING to participate in the facility, First Premium issued
warrants and a noninterest bearing subordinated promissory note to ING. The
warrants enable ING to purchase a 24.99% ownership in First Premium. One
set of the warrants enables ING to purchase a total of 3,342 shares or
19.99% ownership interest of newly authorized Class B, $.01 par value
nonvoting convertible common stock at $.02 per share. In addition, ING was
issued warrants to purchase up to an additional 1,114 shares or 5% ownership
interest of Class B nonvoting convertible common stock at $500 per share.
ING also has the option, in accordance with related put agreements, to
require First Premium to repurchase the warrants at current market value, as
defined in the agreement. These warrants and the related put agreements
expire on December 31, 2004. In addition, First Premium issued a
noninterest bearing subordinated promissory note in the amount of $557,000
with a maturity date of February 12, 1998. This note can be paid, at the
option of ING, through the exercise of the 1,114 warrants.

First Premium issued the warrants and the subordinated note as inducement to
ING to complete the restructured agreement. A total of $625,000 has been
reflected as a component of deferred financing fees on the balance sheet.
The warrants have been valued at approximately $212,000 based on fair value
as estimated by management. They are shown as a minority interest in the
ownership of First Premium. The remaining amount of $413,000 is the initial
value of the $557,000 subordinated note discounted at a market rate of
interest 6% which is recorded at face value less unamortized discount as a
component of subordinated notes on the balance sheet.

F-84
251

The costs of the facility were borne by First Premium and have been
capitalized and are being amortized on the straight-line method over the
life of the ING facility agreement. The total amount capitalized by First
Premium was $973,576 and total accumulated amortization of First Premium in
1995 and 1994 was $735,590 and $475,971, respectively. In addition, the
costs of the securitization facility established prior to February, 1995
have been capitalized by Crabtree and these costs are being amortized into
expense over the life of the facility based on anticipated usage.

Effective January 31, 1995, First Premium entered into a new securitization
facility with ING and HLS. The new facility effectively amends and modifies
the above-discussed facility and provides First Premium with an independent
vehicle into which $200 million of receivables may be sold and funded by
HLS, subject to certain terms and conditions. On the closing date of the
previous facility, FPFC and First Premium terminated all contractual
obligations with regard to the discontinued facility and FPFC ceased
operations.

In connection with the 1995 facility with HLS, First Premium formed a new
wholly owned, bankruptcy remote subsidiary, FPFIN, to purchase the
receivables from First Premium and simultaneously sell the receivables to
HLS. Consistent with the prior securitization facility, all the receivable
sales to HLS are without recourse. FPFIN recognizes a gain at the time of
each sale based on its estimate of Excess Servicing, as defined in Note 3,
to be earned over the life of the receivables sold. All of the subsidiary
accounts are maintained by First Premium and consolidated with First
Premium's financial statements. First Premium performs all administrative
functions of FPFIN, such as cash management and accounting services.

HLS is an independent multiseller conduit which issues commercial paper or
other indebtedness to fund the purchase of receivables from FPFIN. HLS is
not affiliated with First Premium or its affiliates. Pursuant to the Sale
and Servicing Agreement between HLS and First Premium, HLS had engaged First
Premium to provide certain administrative services related to the servicing
of the loans and provides that First Premium be compensated as the Servicer.
Also, pursuant to the Sales and Servicing Agreement, First Premium is
required to maintain facility collateral at an amount equal to 105.5% of
commercial paper outstanding. The amount of this overcollateralization is
recorded as facility overcollateralization on the Company's consolidated
financial statements. Consistent with the prior securitization facility
terms, ING will provide the credit and liquidity enhancement for the HLS
facility.

The costs associated with the HLS facility were borne by First Premium and
have been capitalized and are being amortized on the straight-line method
over the 22-month life of the facility. The total amount capitalized by
First Premium was $275,670 and the total amortization expense in 1995 was
$137,835. The net balance is included in deferred financing fees on the
balance sheet.

F-85
252

6. FINANCE RECEIVABLES

At December 31, 1995 and 1994, finance receivables consisted of premium
finance and equipment lease receivables, as follows (000's omitted):

1995 1994
-------- -------

PREMIUM FINANCE RECEIVABLES:
Premium finance receivables $ 7,979 $93,349
Facility overcollateralization 6,630 0
Other receivables (Note 14) 1,094 0
Less-
Unearned finance charges (257) (2,202)
Allowance for losses on finance receivables (281) (251)
-------- -------
Net premium finance receivables owned, net $ 15,165 $90,896
======== =======
Premium finance receivables serviced without
recourse $101,871 $ 0
======== =======
EQUIPMENT LEASES-
Aggregate future amounts receivable under lease
contracts $ 9 $ 92
Residual value of equipment 37 67
Other lease receivables 379 522
-------- -------
425 681
Less-
Advance payments (2) (14)
Unearned income under lease contracts (24) (35)
Allowance for losses on finance receivables,
owned (258) (386)
Allowance for losses on finance receivables sold
with recourse (312) (193)
-------- -------
Net investment in direct financing leases $ (171) $ 53
======== =======

Equipment lease receivables sold
with recourse $ 1,505 $ 5,695
======== =======

Premium finance receivables arise from the term financing of property and
casualty insurance premiums and are primarily secured by the related
unearned insurance premiums with the insurance company. The average life of
receivables financed is nine months and interest rates charged are based on
the current commercial paper rate plus a spread. The Company had no
significant concentrations of credit risk in 1995 or 1994.

In 1992, the Company's leasing subsidiary, Prospect, sold two lease
portfolios to unrelated parties. Pursuant to the sales agreement, Prospect
is required to reimburse the purchasers for any losses, as defined, incurred
on the sold portfolios, up to a maximum of 10% of

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253

outstanding principal on one of the sold portfolios and for losses in excess
of $500,000 on the other.

Prospect has reserved for losses on the sold portfolios for future
uncollectible principal amounts based on historical loss experience. In
addition, Prospect had amounts on deposit with the purchasers totaling
$724,000 at December 31, 1995 and 1994, to cover losses incurred. This
deposit is classified as funds held in escrow on the balance sheet.

Other lease receivables represent owned lease receivable principal amounts
which Prospect is attempting to collect through litigation. Management
provides reserves for these receivables based upon a specific review of the
portfolio and their estimate of future collections and fair value of
collateral.

7. ALLOWANCE FOR LOSSES

Changes in the allowance for losses on finance receivables during the year
ended December 31, 1995 and 1994, are as follows (000's omitted):

1995 1994
---- ----

Balance, beginning of year $ 830 $ 935
Provision for losses on finance receivables 347 137
Charge-offs, net (326) (242)
----- -----
Balance, end of year $ 851 $ 830
===== =====

Provision for losses are made in amounts sufficient to maintain reserves
equal to management's estimate of probable losses in the portfolio. Amounts
are estimates based on current conditions of the portfolio, previous
experience and current economic conditions. Losses on receivables are
charged off at such time as management believes that the receivables are
uncollectible.

8. FEDERAL INCOME TAXES

As of December 31, 1995, Crabtree had the following operating loss
carryforwards relating to regular tax, which are available to offset future
tax and book income, subject to the limitation discussed below (000's
omitted):

FOR INCOME FOR FINANCIAL
TAX PURPOSES REPORTING PURPOSES
------------ ------------------

Regular tax $9,300 $10,800
====== =======

If not utilized, these carryforwards will expire in varying amounts from the
years 2000 through 2009. No taxes were paid in either 1994 or 1995.

F-87
254

As the result of Crabtree becoming a 100% owner of CLC, certain of CLC's tax
loss carryforwards may be utilized by Crabtree in future years. As of
December 31, 1995, CLC had regular tax net operating loss ("NOL")
carryforwards of approximately $10.1 million which may be available to
offset future taxable income. If not utilized, these carryforwards
will expire in varying amounts from 2004 through 2010.

CLC also has approximately $2.3 million of capital loss carryforwards which
can be utilized to offset future taxable capital gains. If not utilized,
this carryforward will expire in 1996.

9. NOTES AND LOANS PAYABLE

A summary of notes and loans payable at December 31, 1995 and 1994, is as
follows (000's omitted):

WEIGHTED-
LOAN INTEREST MATURITY AVERAGE
AMOUNT RATE DATE INTEREST RATE
------ -------- -------- -------------

1995-
Revolving credit line $1,700 Prime + 1% 03/31/96 10.0%
Secured revolving credit line 200 Prime to prime + 1.5% 04/30/96 9.9
Promissory note 250 Prime 07/01/96 9.0
------
$2,150
======
Subordinated notes-
Deerpath $1,500 Prime +.5% to 1.5% 12/23/97 10.0
ING (net of unamortized
discount of $65) 492 02/12/98
------
$1,992
======
1994-
Revolving credit line $1,950 Prime + 1% 03/31/96 8.3
Promissory note 250 Prime 07/01/95 7.2
------
$2,200
======
Subordinated notes-
Deerpath $1,500 Prime +.5% to 1.5% 12/23/97 8.4
ING (net of unamortized
discount of $94) 463 02/12/98
------
$1,963
======

During 1995, 1994 and 1993, interest paid was $754,000, $625,000 and
$585,000, respectively.

The Crabtree Revolving Credit Line loan represents the amounts outstanding
under an available line of $2,000,000 with a bank. This loan is unsecured,
but is guaranteed by a

F-88
255

significant shareholder of the Company. In March, 1996, this line was renewed
until March 31, 1997. Average borrowings outstanding on this line were
$1,954,258 and $1,739,315 in 1995 and 1994, respectively.

In May, 1995, First Premium renewed and restructured a secured revolving loan
agreement with a bank, which matures April, 1996. Terms of the agreement
include providing a lien and first security interest in the premium finance
receivables not sold to HLS to the bank, as well as restrictions on maintenance
of various operating ratios and tangible net worth. The facility is comprised
of two lines of credit which can combine up to a maximum of $13,000,000. The
primary line is at the bank's prime rate of interest. Borrowings are based on
an eligible premium finance receivable base to a maximum of $13,000,000. The
supplemental line bears interest at the bank's prime rate plus 1.5% to a maximum
of $3,000,000. Borrowings are based on overcollateralized amounts First Premium
maintains in its securitization facility. The average daily amount outstanding
on the primary and supplemental lines in 1995 and 1994 were $2,975,658 and
$2,989,178, respectively.

First Premium utilizes the proceeds from receivable sales to reduce the
outstanding balance of the loan in order to permit release of the lien and first
security interest on the receivables sold.

In the ordinary course of business, a significant shareholder and principal
officer has from time to time extended loan and other credit guarantees to the
Company (see Note 16).

First Premium entered into a letter agreement with Deerpath Investment Partners,
Ltd. ("Deerpath"), a shareholder of Crabtree, under which additional capital
funds of $1,500,000 were committed. The funding was received by First Premium
on December 23, 1992, with the understanding that Deerpath would receive
subordinated debt and a participating equity interest in First Premium.
Effective February 19, 1993, the transaction was modified so that Crabtree
contributed additional capital of $1,000,000 to First Premium. Crabtree
purchased a $200,000 unsecured subordinated note from First Premium and received
warrants to purchase shares of common stock of First Premium. Deerpath
purchased a $300,000 subordinated note from First Premium and Deerpath received
warrants to purchase shares of common stock of First Premium. Deerpath also
purchased a $1,200,000 subordinated note from Crabtree. The total committed
capital of $1,500,000 of unsecured subordinated notes bear interest at prime
plus .5% to 1.5% and mature on December 23, 1997, and are shown as a component
of subordinated notes on the balance sheet. The warrants issued to Crabtree
enable the holder to purchase a total of 482 shares of First Premium common
stock at $500 per share. Crabtree subsequently transferred ownership of these
warrants to Deerpath. The warrants issued to Deerpath enable the holder to
purchase a total of 600 shares of First Premium's common stock at $500 per
share. The subordinated notes may be repaid, at the option of Deerpath, through
the exercise of the warrants. Deerpath also has the option, in accordance with
related put agreements, to require First Premium to repurchase the warrants at
current market value, as defined in the agreements. These warrants and the
related put agreements expire on December 31, 2004. No value has been assigned
to these warrants as the exercise price is substantially in excess of the fair
value of the common stock of First Premium. First Premium has 13,375 shares of
common stock outstanding at December 31, 1995.

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256

10. COMMERCIAL PAPER

First Premium Funding Corporation, issued commercial paper notes having
maturities of 1 to 270 days to finance the purchase of receivables from
First Premium. Upon the formation of the HLS facility in February, 1995,
First Premium Funding Corporation discontinued issuance of commercial paper
notes.

The table below sets forth information concerning outstanding commercial
paper and its related cost. These amounts are computed using the average
daily balances during the periods from January 1, 1995, through February 2,
1995, and January 1, 1994, through December 31, 1994.

1995 1994

Average amount outstanding $81,015,757 $74,769,633
Maximum month-end amount
outstanding during the period $85,000,000 82,565,000
=========== ============
Average yield at-
End of period 6.10% 6.12%
During the period 5.96% 4.54
=========== ============

11. STOCK OPTION AND STOCK APPRECIATION RIGHTS PLANS

Crabtree's 1987 Stock Option Plan and Stock Appreciation Rights Plan (the
"Option Plan" and "SAR Plan," respectively, or collectively referred to as
the "Crabtree Plans" or "Plans") were adopted by the Board of Directors and
approved by the stockholders in October, 1987. As of December 31, 1995,
options to purchase up to 275,000 common shares and 200,000 stock
appreciation rights may be granted pursuant to the Plans. The Plans and
their terms are administered by the Board of Directors.

The Option Plan provides for the granting of Incentive Stock Options,
Nonqualified Stock Options and the sale of Restricted Stock to key employees
(including officers, directors and employees of all subsidiary corporations)
having principal responsibility for the long-term success of the Company.
In addition, the Option Plan provides that Stock Appreciation Rights
("SARs") may be granted on conjunction with any option granted pursuant to
this Plan. No SARs are outstanding as of December 31, 1995.

Options and SARs are granted at a price equal to fair value at date of grant
and become exercisable in four equal annual installments. Options and SARs
granted have a maximum duration of 10 years. The vesting period commences
the date the employee begins employment with Crabtree or the subsidiary
becomes a subsidiary of Crabtree.

F-90

257

The following is a summary of stock option information:

OPTION OPTION PRICE
SHARES PER SHARE
------ ------------

Outstanding, December 31, 1993 63,225 $7-$25
Granted 0 0
Exercised 0 0
Canceled or expired 0 0
------ ------------
Outstanding, December 31, 1994 63,225 $7-$25
Granted 0 0
Exercised 0 0
Canceled or expired 0 0
------ ------------
Outstanding, December 31, 1995 63,225 $7-$25
====== ============
Exercisable, December 31, 1995 63,225 $7-$25
====== ============

During 1990, two senior officers of Crabtree purchased 60,000 shares of
stock at $5 per share under the 1990 Stock Purchase Plan (the "Plan").
This stock was purchased with a permanent discount of $20 per share, or at
a total value of $25 per share. Under this plan, gains on the stock accrue
to the holders only if the value of the stock exceeds $25 per share. Under
the terms of the Plan, in the event of a merger or public offering of
stock, the discount provisions are terminated. The purchase price of the
60,000 shares at $5 per share was paid for with promissory notes totaling
$300,000 bearing interest at 10% and payable in annual amounts through
1997. These notes were fully paid as of December 31, 1994. As described in
Note 2, the financial statements have been retroactively restated to give
effect to the recording of $1.2 million of compensation expense related to
the issuance of these shares.

Effective July, 1992, an employee stock option plan was approved by First
Premium. The stock option plan covers 2,300 shares of common stock. On
July 20, 1992, incentive options to purchase 1,663 shares were granted to
certain employees at an exercise price of $400 per share, the estimated
fair market value as determined by the Board of Directors. Options under
this grant vest over 4 years and must be exercised within 10 years of the
grant date.

12. BENEFIT PLAN

First Premium has a contributory retirement savings plan (pursuant to
Section 401(k) of the Internal Revenue Code) covering substantially all
employees. Under the plan, benefits are generally determined based on
employee contributions, subject to IRS limitations and First Premium
contributions (as declared by the Board of Directors). All full-time
employees are eligible to participate in the plan after attainment of 21
years of age and 6 months of service. First Premium's expense for this
plan was $32,718, $22,986 and $14,610 in 1995, 1994 and 1993, respectively.
First Premium does not currently offer other postretirement benefits such
as health care or other pension.

F - 91
258

13. DIVIDEND RESTRICTIONS

In connection with the Company's debt agreements (see Note 9), the Company
is not allowed to declare any dividends unless approved by the banks.

14. COMMITMENTS AND CONTINGENCIES

The Company and certain subsidiaries lease their office facilities. Total
minimum annual noncancelable rental commitments at December 31, 1995, are as
follows (000's omitted):

AMOUNT
------

Year-
1996 $ 351
1997 259
1998 262
1999 270
2000 and thereafter 138
------
$1,280
======

First Premium has filed suit against an obligor in federal court in Miami,
Florida, to collect the remaining balance of $1,094,339 owing on an original
premium finance loan in the amount of $4,592,000. In addition, First
Premium seeks accumulated interest, late charges and attorney fees due to
it. Additional defendants include: (1) the obligor Director of Insurance
of over 16 years, who executed the premium finance agreement, (2) two
separate insurance agents who, along with the obligor's Director of
Insurance, falsely presented in writing to First Premium the named insurers
involved and the effective dates, policy numbers, premium amounts, insurer
names and policy terms for the insurance policies being financed, (3) three
separate insurance companies and the managing general agent for two of them,
who directed that premiums be remitted to them via the insurance agent
(their agent) who falsely represented the coverages to First Premium, and
who also were unjustly enriched because they misappropriated premiums paid
by First Premium for specific financed policies to pay other policies not
financed by First Premium. In addition, at an appropriate time, First
Premium anticipates filing suit against Errors and Omissions insurance
companies covering the obligor, obligor's Director of Insurance and one of
the insurance agents.

The lawsuit is currently set for trial in August, 1996. Presently,
discovery via depositions of the defendants and document production and
examination is occurring.

Management, after consultation with legal counsel, believes the ultimate
result of this legal action in this matter will result in a favorable
settlement or, in the alternative, a favorable jury verdict and subsequent
collection in full of the amount due to First Premium because of the
underlying facts, applicable law, the number of defendants, many of which
appear to be severally liable for the entire amount due to First Premium and
the financial ability of the defendants to pay the anticipated settlement or
judgment. The amount of the uncollected receivable is classified as other
receivables at December 31, 1995.

F-92
259

In the ordinary course of business, there are various other legal
proceedings pending against the company. Management considers that the
aggregate liabilities, if any, resulting from such actions would not have
a material adverse effect on the financial position of the Company.

15. FAIR VALUE OF FINANCIAL INSTRUMENTS

Crabtree has estimated the fair value of its financial instruments in
accordance with Statement of Financial Accounting Standards No. 107 ("FAS
107"), "Disclosures About Fair Value of Financial Instruments." Financial
instruments include cash, finance receivables, facility
overcollateralization, notes and loans payable, and commercial notes
payable. FAS 107 specifically excludes lease contracts and minority
interests in consolidated subsidiaries from the definition of financial
instruments.

The following assumptions were used to estimate the fair value of
Crabtree's financial instruments:

Cash:

The carrying value approximates fair value for this instrument due to its
liquid nature.

Finance receivables

Due to the short term nature of the premium finance receivables, the rate
earned on these receivables approximates a current market rate, and as a
result, carrying value approximates market value.

Facility Overcollateralization:

Facility overcollateralization represents premium finance receivables
deposited with HLS pursuant to the securitization facility agreement. As
such, due to the short term nature of these receivables, carrying value
approximates market value.

Subordinated notes, Notes and loans payable:

The fair value of these instruments was determined to approximate existing
carrying value because interest rates on these instruments adjust with
changes in market rates due to their repricing characteristics.

Commercial paper notes payable:

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260

16. RELATED-PARTY TRANSACTIONS

Crabtree from time to time borrowed money from CLC under secured
promissory notes which bore interest at 10%. Such transactions occurred
in March, 1993, for $300,000 which was repaid in June, 1993, August, 1993,
for $250,000 which was repaid in January, 1994, and in April, 1994, for
$175,000 which was repaid in March, 1995. These transactions resulted in
interest expense to Crabtree of $12,000 in 1993, $14,000 in 1994 and
$3,000 in 1995.

During 1995 and 1994, the Company's bank debt was guaranteed by a
significant shareholder and principal officer of the Company. The Company
agreed to pay a fee to this individual for the guarantee at a rate of 1.5%
of the balance of the debt guaranteed. These transactions resulted in
expense to Crabtree of $32,973, $29,840 and $68,339 in 1995, 1994 and
1993, respectively, and are included in other expense on the Company's
statement of income.

Various shareholders, from time to time, perform advisory and consulting
services for the Company. Amounts paid to shareholders and other related
parties for these services are $301,253, $281,544 and $409,039 in 1995,
1994 and 1993, respectively, and are classified as professional fees
on the income statements.

During 1993, the Board of Directors approved the purchase by a significant
shareholder and principal officer of the Company of an automobile,
furniture and office equipment for a total purchase price of $38,400.
This amount was paid in 1994.

17. SUBSEQUENT EVENT

The Board of Directors has approved a proposed Agreement and Plan of
Reorganization (the "Agreement") by and among Crabtree, Libertyville
Bancorp, Inc., North Shore Community Bancorp, Inc., Hinsdale Bancorp,
Inc., and Lake Forest Bancorp, Inc. (the "Constituents") with North Shore
Community Bancorp, Inc. as the Resulting Corporation. As a part of the
merger, North Shore Community Bancorp, Inc. will be renamed to "WINTRUST
FINANCIAL CORPORATION" ("WINTRUST"). Pursuant to the Agreement, common
stock of WINTRUST will be exchanged for the outstanding shares of common
stock of the Constituents based upon exchange ratios specified in the
Agreement. The proposed transaction is contemplated to be accounted for
as a pooling of interests transaction and is subject to shareholder and
regulatory approval.

F-94

261
APPENDIX A

AGREEMENT AND PLAN OF REORGANIZATION

by and among

NORTH SHORE COMMUNITY BANCORP, INC.

and

LAKE FOREST BANCORP II,
HINSDALE BANCORP II,
LIBERTYVILLE BANCORP II,
and
CRABTREE CAPITAL CORPORATION II,
each a wholly owned subsidiary of
North Shore Community Bancorp, Inc.
and
LAKE FOREST BANCORP, INC.
and
HINSDALE BANCORP, INC.
and
LIBERTYVILLE BANCORP, INC.
and
CRABTREE CAPITAL CORPORATION

Dated as of this 28th day of May, 1996
262

TABLE OF CONTENTS

Section Page
- ------- ----

1. REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-2
1.1 The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-2
1.2 Articles of Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-2
1.3 Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-2
1.4 Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-3
1.5 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-3
1.6 Effect of the Merger on Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-3
1.7 Effect of the Merger on Capital Stock of the Merging Companies . . . . . . . . . . . . . . . . . . . A-4
1.8 Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-5
1.9 Conversion of Rights/Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-5
1.10 Dissenting Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6

2. CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
2.1 Time; Place . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
2.2 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
2.3 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
2.4 Exchange of Share Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6

3. REPRESENTATIONS AND WARRANTIES OF NSCB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
3.1 Organization, Power and Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
3.2 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
3.3 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-8
3.4 Non-Contravention, No Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-8
3.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
3.6 Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
3.7 Absence of Certain Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
3.8 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-10
3.9 Condition of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
3.10 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
3.11 No Default, Violation or Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
3.12 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
3.13 Employment, Labor and Other Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
3.14 Employee Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-13
3.15 Patents, Trademarks and Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
3.16 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
3.17 Other Material Adverse Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
3.18 Disinterested Directors Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14

4. REPRESENTATIONS AND WARRANTIES OF SURVIVING COMPANIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
4.1 Organization, Power and Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-14
4.2 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
4.3 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15

263

Section Page
- ------- ----

4.4 Authorization; Non-Contravention; Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-15
4.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-16
4.6 Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-16
4.7 Absence of Certain Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-17
4.8 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-18
4.9 Condition of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-18
4.10 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
4.11 No Default, Violation or Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-19
4.12 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
4.13 Employment, Labor and Other Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-20
4.14 Employee Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
4.15 Patents, Trademarks and Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
4.16 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-21
4.17 Other Material Adverse Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22
4.18 Disinterested Directors Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22

5. COVENANTS AND ADDITIONAL AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-22
5.1 Conduct of Business Pending Consummation of Merger; No Material Change . . . . . . . . . . . . . . . A-22
5.2 Maintain Surviving Companies, Surviving Subsidiaries, the Bank and NSCB as Going Concerns . . . . . A-23
5.3 Preserve Accuracy of Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.4 Extension of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.5 Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.6 Supplements to Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.7 Best Efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.8 Registration Statement; Shareholder Approval . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-24
5.9 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-25
5.10 Affiliate Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-25
5.11 Material Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-25
5.12 Notification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-26
5.13 Due Diligence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-26
5.14 Conversion of Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27

6. CONDITIONS TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
6.1 No Injunctions or Restraints; Illegality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
6.2 Shareholder Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
6.3 Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-27
6.4 Effectiveness of Form S-4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
6.5 Regulatory Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
6.6 Tax Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28
6.7 Pooling of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-28

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Section Page
- ------- ----

6.8 First Premium Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-29
6.9 Conversion of First Premium and Credit Life Option Plans . . . . . . . . . . . . . . . . . . . . . . A-29
6.10 No Material Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-29
6.11 Consummation of First Premium/Credit Life Merger . . . . . . . . . . . . . . . . . . . . . . . . . . A-30

7. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
7.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30
7.2 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-30

8. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
8.1 Waiver of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
8.2 Amendment of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
8.3 Contents of Agreement; Binding Nature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
8.4 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-31
8.5 Commissions and Finder's Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.6 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.7 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.8 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.9 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.10 Governing Law; Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-32
8.11 Instruments of Further Assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
8.12 Publicity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33
8.13 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-33

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SCHEDULES

A. Directors and Officers of Resulting Company
B. Schedule of Warrants
C. Schedule of Rights/Options
D. Capitalization of NSCB and the Merging Companies
E. Capitalization of the Surviving Companies
F. Schedule of Preferred Stock

EXHIBITS

A. Form of Plan of Merger
B. Form of Amended and Restated Articles of Incorporation of Resulting
Company
C. Amended and Restated By-Laws of Resulting Company
D. Form of Affiliate Letters

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AGREEMENT AND PLAN OF REORGANIZATION

THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made as
of this 28th day of May, 1996 by and among NORTH SHORE COMMUNITY BANCORP, INC.,
an Illinois corporation ("NSCB"), LAKE FOREST BANCORP II, an Illinois
corporation ("LFBII"), HINSDALE BANCORP II, an Illinois corporation ("HBII"),
LIBERTYVILLE BANCORP II, an Illinois corporation ("LBII"), CRABTREE CAPITAL
CORPORATION II, an Illinois corporation ("Crabtree II"), each a wholly owned
subsidiary of NSCB, and each of LAKE FOREST BANCORP, INC., a Delaware
corporation ("LFB"), HINSDALE BANCORP, INC., an Illinois corporation ("HB"),
LIBERTYVILLE BANCORP, INC., an Illinois corporation ("LB"), and CRABTREE
CAPITAL CORPORATION, a Delaware corporation ("Crabtree").

W I T N E S S E T H:

WHEREAS, NSCB is the owner of one hundred percent (100%) of the
capital stock of LFBII, HBII, LBII and Crabtree II (LFBII, HBII, LBII and
Crabtree II are sometimes collectively referred to herein as the "Merging
Companies");

WHEREAS, each of NSCB and the Surviving Companies have in common one
or more members of their respective boards of directors and a number of
stockholders, and each of NSCB, LFB, HB and LB have in common a number of
executive officers who divide their time among each of such companies;

WHEREAS, NSCB, together with LFB, HB, LB and Crabtree (each of LFB,
HB, LB and Crabtree is sometimes referred to herein as a "Surviving Company"
and sometimes collectively referred to herein as the "Surviving Companies")
desire to effectuate a corporate reorganization (the "Reorganization") to form
a combined parent holding company for all of such businesses through a plan of
merger pursuant to which LFBII will merge with and into LFB, HBII will merge
with and into HB, LBII will merge with and into LB, and Crabtree II will merge
with and into Crabtree, with NSCB surviving as the ultimate parent holding
company with a new name and such corporate changes as provided for herein (the
"Resulting Company"), all on the terms and conditions set forth herein and in
the Plan of Merger attached hereto as Exhibit A (the "Plan of Merger");

WHEREAS, as a result of the Reorganization, each of the issued and
outstanding shares of the Surviving Companies shall be converted into the right
to receive shares of common stock of the Resulting Company and each of the
issued and outstanding shares of the Merging Companies shall be converted into
shares of the applicable Surviving Company, such that the Resulting Company
will own one hundred percent (100%) of the capital stock of LFB, HB, LB and
Crabtree as a result of the Reorganization;

267

WHEREAS, the respective Boards of Directors of NSCB, the Merging
Companies, and the Surviving Companies deem it advisable and in the best
interests of each of them and their respective shareholders that the Merging
Companies be merged with and into the Surviving Companies in the manner
contemplated herein, and each of the aforesaid Boards of Directors have adopted
resolutions approving this Agreement and have recommended the actions
contemplated for approval and adoption by the holders of the issued and
outstanding shares of the capital stock of each of the Merging Companies and
the Surviving Companies;

WHEREAS, the respective Boards of Directors of NSCB and each of the
Surviving Companies have agreed to share certain costs, fees and expenses
attributable to the proposed Reorganization, said fees and costs to be paid
regardless of whether or not the proposed Reorganization is consummated;

WHEREAS, for federal income tax purposes, it is intended that the
proposed transaction shall qualify as a tax-free reorganization within the
meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the
"Code"), and that this Agreement shall constitute a "plan of reorganization"
for the purposes of Section 368 of the Code.

NOW THEREFORE, in consideration of the foregoing premises and the
mutual promises, covenants and agreements hereinafter set forth, the parties
hereto agree as follows:

1. REORGANIZATION

1.1 THE MERGER. As of the Effective Date, as that term is defined
herein, the Merging Companies shall merge into the Surviving Companies in
accordance with the terms of this Agreement and the applicable provisions of
the Illinois Business Corporation Act (the "BCA") and the Delaware General
Corporation Law ("DGCL") (the "Merger"), and the issued and outstanding shares
of the Surviving Companies shall be converted into shares of the Resulting
Company as provided for in Section 1.6 and the issued and outstanding shares of
the Merging Companies shall be converted into shares of the Surviving Companies
as provided for in Section 1.7, and the separate corporate existence of each of
the Merging Companies shall cease.

1.2 ARTICLES OF INCORPORATION. As of the Effective Date, the
Articles of Incorporation of the Resulting Company shall be amended and
restated to read in their entirety as set forth in Exhibit B, and shall
thereafter remain in full force and effect until amended in accordance with
applicable law. The Articles of Incorporation, or Certificates of
Incorporation, as the case may be, of the Surviving Companies, as in effect on
the Effective Date, shall be the Articles of Incorporation, or Certificates of
Incorporation, as the case may be, of the Surviving Companies, as the surviving
entities, following the Effective Date.

1.3 BYLAWS. The Bylaws of the Resulting Company shall be amended
and restated to read in their entirety as set forth in Exhibit C, and shall
remain in full force and effect until

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thereafter amended in accordance with applicable law. The Bylaws of the
Surviving Companies, as in effect on the Effective Date shall be the Bylaws of
the Surviving Companies, as the surviving entities, following the Effective
Date.

1.4 DIRECTORS AND OFFICERS. As of the Effective Date, the
officers and directors of the Surviving Companies, and the Surviving
Subsidiaries (as that term is defined in Section 4.2) immediately prior to the
Effective Date shall be the officers and directors of the Surviving Companies
and the Surviving Subsidiaries until such time as their respective successors
have been elected and qualified and no change shall occur in the officers and
directors of the Surviving Companies, the Surviving Subsidiaries, or the Bank
(as that term is defined in Section 3.2), as a result of the proposed
Reorganization. As of the Effective Date, the officers and the directors of
the Resulting Company shall be those persons set forth on Schedule 1.4.

1.5 NAME. As of the Effective Date, the name of the Resulting
Company shall be "WINTRUST FINANCIAL CORPORATION."

1.6 EFFECT OF THE MERGER ON CAPITAL STOCK.

(a) Common Stock. As of the Effective Date, by virtue of
the Merger, each validly issued and outstanding share of the capital stock of
NSCB and the Surviving Companies, other than Dissenting Shares (as that term is
defined in Section 1.10) (collectively, the "Shares") and shall be converted,
adjusted or cancelled as follows:

(i) LFB. Except as provided in Section
1.6(a)(viii) below, each share of the common stock, no par value per
share, of LFB (the "LFB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 9.67334 shares (the "LFB
Exchange Ratio") of the common stock, without par value, of the
Resulting Company ("RC Shares");

(ii) HB. Except as provided in Section
1.6(a)(viii) below, each share of the common stock, no par value per
share, of HB (the "HB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 6.03398 RC Shares (the
"HB Exchange Ratio");

(iii) LB. Except as provided in Section
1.6(a)(viii) below, each share of the common stock, no par value per
share, of LB (the "LB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 4.02578 RC Shares (the
"LB Exchange Ratio");

(iv) Crabtree. Except as provided in Section
1.6(a)(viii) below, each share of the common stock, par value $1.00
per share, of Crabtree (the "Crabtree

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Common Stock") validly issued, fully paid and nonassessable,
outstanding immediately prior to the Effective Date shall be converted
into the right to receive 1.18332 RC Shares (the "Crabtree Exchange
Ratio").

(The LFB Exchange Ratio, the HB Exchange Ratio, the
LB Exchange Ratio and the Crabtree Exchange Ratio are hereinafter
collectively referred to as the "Exchange Ratios").

(v) NSCB. Except as provided in Section
1.6(a)(viii) below, each share of common stock, no par value, of NSCB
(the "NSCB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be adjusted in the form of a stock split from and after the
Effective Date so as to represent 5.16180 RC Shares (the "NSCB
Exchange Ratio").

(vi) Share Certificates. The certificate(s) which
formerly represented the Shares shall, from and after the Effective
Date, represent the right to receive the number of shares of the
Resulting Company set forth above in subsections (a) through (e) of
this Section 1.6 until exchanged as provided for in Section 2.5.

(vii) Fractional Shares. No certificate for
fractional RC Shares will be issued by the Resulting Company in
connection with the exchange contemplated by the Merger, but in lieu
thereof, any holder of Shares shall, upon surrender of the
certificates(s) representing such Shares, be paid cash, without
interest, by the Resulting Company for such fractional shares in an
amount equal to $15.00 multiplied by such fraction.

(viii) Cancellation of Treasury Stock, Intercompany
Shares. Any Shares of NSCB or any Surviving Company, as the case may
be, which are owned by any other Surviving Company or NSCB immediately
prior to the Effective Date, and any shares of treasury stock held by
any Surviving Company or NSCB immediately prior to the Effective Date,
shall be cancelled and shall cease to exist as of the Effective Date
and no RC Shares shall be delivered in exchange therefor.

(b) Preferred Stock. Any shares of preferred stock of
any of the Surviving Companies issued and outstanding as of the Effective Date
shall be cancelled. It being contemplated that all such preferred shares will
have been converted to common stock as provided in Section 5.14 hereof.

1.7 EFFECT OF THE MERGER ON CAPITAL STOCK OF THE MERGING
COMPANIES. Each validly issued and outstanding share of common stock of each
of the Merging Companies shall be converted into one share of the applicable
Surviving Company as of the Effective Date as follows:

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Merging Applicable
Company Surviving Company
--------- -----------------

LFB II LFB
HB II HB
LB II LB
Crabtree II Crabtree

1.8 WARRANTS. There currently are issued and outstanding certain
warrants (a "Warrant" or collectively the "Warrants") providing holders thereof
the right to purchase common stock of NSCB, HB, LB and of the wholly owned
subsidiary of Crabtree, First Premium Services, Inc., an Illinois corporation
("First Premium"). Each Warrant, other than the First Premium Warrants, which
is validly issued and outstanding immediately prior to the Effective Date shall
remain outstanding after the Effective Date and shall be unaffected by the
Reorganization, except that the NSCB Warrants shall be adjusted to give effect
to the stock split provided for in Section 1.6(a)(v). At or prior to the
Effective Date, the First Premium Warrants shall have been replaced with
Warrants to purchase Crabtree Common Stock as provided for in Section 6.8, and,
to the extent not exercised prior to the Effective Date, such Crabtree Warrants
shall be converted pursuant to the Reorganization on the basis of the Crabtree
Exchange Ratio into Warrants to purchase RC Shares. Schedule 1.8 sets forth
the number of Shares subject to outstanding Warrants and, in the case of First
Premium and NSCB, the number of RC Shares that will be subject to the Warrants
upon consummation of the Reorganization (assuming no prior exercise thereof).

1.9 CONVERSION OF RIGHTS/OPTIONS. There currently exist at NSCB,
LFB, HB, LB, Crabtree, First Premium and The Credit Life Companies, Inc., a
Delaware corporation, which is a non-operating wholly-owned subsidiary of
Crabtree ("Credit Life"), certain stock rights plans and/or option plans
(collectively, the "Rights/Option Plans") under which holders of stock rights
and options issued pursuant thereto have certain rights to purchase NSCB Common
Stock, LFB Common Stock, HB Common Stock, LB Common Stock, Crabtree Common
Stock, First Premium Common Stock or Credit Life Common Stock, respectively.
Each option or stock right, as the case may be, which is validly issued and
outstanding pursuant to any of such Rights/Option Plans of the Surviving
Companies immediately prior to the Effective Date shall, in accordance with the
terms of such Rights/Option Plans, by virtue of the Merger and without any
action on the part of the holder thereof, become and represent an option or
stock right, as the case may be, to purchase that number of RC Shares into
which the shares subject to such option or stock right would have been
converted giving effect to the applicable Exchange Ratio, or, in the case of
the First Premium and Credit Life options, into that number of RC Shares as
contemplated by Section 6.9 hereof, and at an exercise price appropriately
adjusted to reflect such conversion. Schedule 1.9 sets forth each option or
stock right, as the case may be, which is validly issued and outstanding, or is
contemplated to be outstanding prior to the Effective Date, under the
Rights/Option Plans and the number of RC Shares the holder will be entitled to
purchase giving effect to the Exchange Ratios upon the Effective Date.

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271

1.10 DISSENTING SHAREHOLDERS. A "Dissenting Share" shall mean a
Share held by any person who properly exercises appraisal rights, if any, under
the BCA or DGCL, as the case may be, with respect to such Share. The holder of
any Dissenting Share shall have the rights, subject to the limitations,
provided under the BCA or DGCL, as the case may be.

2. CLOSING

2.1 TIME; PLACE. The consummation of the transactions
contemplated by this Agreement (the "Closing") shall take place at the offices
of Lake Forest Bank & Trust Company at 10:00 A.M. (Chicago time) on the
Effective Date, or such other time and place as the parties mutually agree.

2.2 EFFECTIVE DATE. The transaction contemplated by this
Agreement shall become effective upon the filing of Articles of Merger with the
Illinois Secretary of State and a Certificate of Merger with the Delaware
Secretary of State which filings shall be made on such date as the parties
mutually agree as promptly as practicable following satisfaction of the
conditions set forth in Section 6 herein (or waiver thereof to the extent
legally permissible) (said date and time referred to herein as the "Effective
Date").

2.3 FURTHER ASSURANCES. If at any time after the Effective Date
any party shall consider or be advised that any further deeds, assignments or
assurances in law or any other acts are necessary, desirable or proper (i) to
vest, perfect or confirm, of record or otherwise, by any party or (ii)
otherwise carry out the purposes of this Agreement for any party, the other
parties agree to execute and deliver all such deeds, assignments and assurances
in law and do all acts reasonably necessary, desirable or proper to vest,
perfect and confirm the actions required by such party or parties, to carry out
the purposes of this Agreement.

2.4 EXCHANGE OF SHARE CERTIFICATES. As soon as practicable after
the Effective Date, the Resulting Company shall mail to each holder of record
of Shares a letter of transmittal and instructions for use in the surrender of
the Shares in exchange for certificates representing RC Shares and any cash in
lieu of fractional shares into which the Shares shall have been converted or
adjusted pursuant to the terms of this Agreement. Upon proper surrender of
certificates for exchange and cancellation to the Resulting Company, the holder
of such Shares shall be entitled to receive in exchange therefor, as applicable
(i) a certificate representing the number of shares of RC Shares to which such
holder of Shares may have become entitled pursuant to the provisions of this
Agreement, and/or (ii) a check representing the amount of any cash in lieu of
fractional shares which such holder has the right to receive in respect of the
Shares surrendered pursuant to the provisions of this Section 2.4. No interest
will be paid or accrued on any cash payable in lieu of fractional shares or on
any unpaid dividends and distributions payable to holders of Shares.

No dividends or other distributions that are declared on or after the
Effective Date on RC Shares or otherwise payable to holders of record thereof
on or after the Effective Date will be

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paid until such persons surrender their Shares, as provided for herein, and no
cash payment in lieu of fractional shares shall be paid to any such holder
until the holder of such Shares shall so surrender the Shares. In no event
shall the person entitled to receive such dividends or other distributions be
entitled to receive interest on such dividends or other distributions. If any
cash or certificate representing shares of RC Shares is to be paid to or issued
in the name of a person other than that in which the Shares surrendered in
exchange therefor are registered, it shall be a condition of such exchange that
the Shares so surrendered shall be properly endorsed and otherwise in proper
form for transfer and that the person requesting such exchange shall pay to the
Resulting Company any transfer or other taxes required by reason of the
issuance of the certificates for such shares of RC Shares in a name other than
that of the registered holder of the Shares surrendered, or shall establish to
the satisfaction of the Resulting Company that such tax has been paid or is not
applicable.

In the event that any certificates representing Shares shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
person claiming the rights to such Shares setting forth that such Shares were
either lost, stolen or destroyed, together with any bond or indemnity agreement
as the Resulting Company may deem reasonably necessary, the Resulting Company
may issue in exchange for such lost, stolen or destroyed share certificates
representing the RC Shares and any cash in lieu of fractional shares
deliverable in respect thereof pursuant to this Agreement.

From and after the Effective Date, there shall be no transfers on the
stock transfer books of the Surviving Companies of any Shares outstanding
immediately prior to the Effective Date and any such Shares presented to the
Resulting Company shall be cancelled in exchange for the RC Shares issued with
respect thereto as provided in Section 1.6.

3. REPRESENTATIONS AND WARRANTIES OF NSCB

NSCB represents and warrants, to each of the Surviving Companies as
follows:

3.1 ORGANIZATION, POWER AND QUALIFICATION. Each of the Merging
Companies and NSCB are Illinois corporations, duly organized and validly
existing under the laws of the State of Illinois and each of the aforesaid have
all requisite corporate power and authority to own or hold under lease their
properties and assets and to carry on their businesses as now conducted. Each
of the Merging Companies has taken all corporate action necessary to approve
the Merger. The minute books and stock record books of the Merging Companies
and NSCB containing minutes of director and stockholder meetings and stock
transfer and ownership records are complete and correct in all material
respects.

3.2 SUBSIDIARIES. None of the Merging Companies has any
subsidiaries, has conducted any business or taken any action except as
contemplated by this Agreement, nor owns directly or indirectly, any stock,
bonds or securities or any equity or other proprietary interest in any
corporation, partnership, joint venture, business enterprise or other entity of
any nature

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whatsoever. NSCB owns one hundred percent (100%) of the issued and outstanding
stock of each of LFBII, HBII, LBII and Crabtree II which consists of 163,360,
207,137, 229,929, and 1,025,265 shares of common stock, no par value per share,
respectively.

NSCB owns one hundred percent (100%) of the right, title and interest
in and to North Shore Community Bank & Trust Company, an Illinois state banking
corporation (the "Bank"), and all such shares are owned free and clear of any
and all liens or encumbrances. The Bank has been duly organized and is validly
existing and has all requisite corporate power and authority to own and hold
under lease its properties and assets and to carry on its business as now
conducted.

3.3 CAPITALIZATION. Schedule 3.3 to this Agreement sets forth the
number and classes of shares of capital stock of NSCB and each of the Merging
Companies which is authorized, issued and outstanding and all shares reserved
for issuance upon exercise of any and all options, warrants and rights
currently outstanding or available for grant pursuant to existing stock option
plans or any other agreements of NSCB or the Merging Companies providing
therefor.

3.4 NON-CONTRAVENTION, NO VIOLATION. The execution and delivery
of this Agreement and the Plan of Merger by each of the Merging Companies and
NSCB, and the other agreements and documents, including without limitation, the
Articles of Merger and/or Certificate of Merger, to be executed and delivered
by each of the Merging Companies (collectively the "Articles of Merger") and
NSCB hereunder, do not and will not, and the consummation by each of the
Merging Companies and NSCB of the transactions contemplated on its part hereby
and thereby will not, constitute or result in (with or without the giving of
notice or the lapse of time or both) (a) a breach or violation of, or a default
under, any provision of the articles or certificate of incorporation or by-laws
of any of the Merging Companies or NSCB or the Bank, (b) a breach or violation
of, a default under, or the triggering of any payment or other material
obligation pursuant to any of the Merging Companies' or NSCB's and/or the
Bank's benefit plans described in Section 3.14 or any grant or award made under
any of the foregoing, or (c) a material breach or violation of, or a conflict
with, or a material default under, or termination of, or an event permitting
any other person to terminate, or the acceleration of, or the creation or
imposition of any lien, charge, pledge, security interest or other encumbrance
on any properties or assets of any of the Merging Companies or NSCB or the
Bank, pursuant to any provision of any material lease, contract, license or
other agreement binding upon any of the Merging Companies or NSCB or the Bank
or pursuant to any provision of any law, rule, judgment, decree, regulation,
ordinance or order, award or governmental permit or license, applicable to any
of the Merging Companies or NSCB or the Bank or any of their respective
properties or assets, or (d) any material change in the rights or obligations
of any party under any of the Contracts described pursuant to Section 3.10
hereof, including any such change as the result of a change in control
provision or similar provision contained in any such contract.

Except for (i) the filing of applications and notices, as applicable,
with the Board of Governors of the Federal Reserve System ("Federal Reserve
Board') under the Bank Holding

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Company Act of 1956, as amended ("BHC Act"), and approval of such applications
and notices, (ii) the filing of any required applications or notices with any
state agencies including without limitation the Illinois Commissioner of Banks
and Trust Companies and the applicable state securities administrators (the
"State Approvals"), (iii) the filing with the Securities and Exchange
Commission (the "SEC") of the registration statement on Form S-4 (the
"Registration Statement") in which the joint proxy statement/prospectus will be
included, (iv) the filing of the Certificates and Articles of Merger with the
Delaware and Illinois Secretaries of State pursuant to the DGCL and the BCA,
respectively, and (v) the approval of this Agreement by the requisite vote of
the stockholders of each of the Surviving Companies and NSCB, no consent or
approvals of or filings or registrations with any court, administrative agency
or commission or other governmental authority or instrumentality are necessary
in connection with the execution of this Agreement and the transactions
contemplated thereby.

3.5 FINANCIAL STATEMENTS. NSCB has made available to the
Surviving Companies its consolidated balance sheets as of December 31, 1994 and
1995, and the related statements of income, changes in the shareholders' equity
and cash flows for the years then ended.

The term "Financial Statements" as used in this Section 3 shall mean
the above-described financial statements.

The Financial Statements are complete and accurate and fairly present
the assets, liabilities and financial condition of NSCB, on a consolidated
basis, at the date thereof, and the statements of income and retained earnings
and changes in financial position and the notes thereto included in the
Financial Statements are complete and accurate and fairly present the results
of operations for the periods therein referred to, all in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved ("GAAP").

3.6 UNDISCLOSED LIABILITIES. None of the Merging Companies, NSCB
or the Bank has any liabilities or obligations (direct or indirect, contingent
or absolute, known or unknown, matured or unmatured) of any nature whatsoever,
whether arising out of contract, tort, statute or otherwise ("Liabilities"),
except (a) as reflected, reserved for or given effect to in the Financial
Statements; (b) routine operating expenses and contract obligations incurred in
the ordinary course of business since the date of the most recent balance sheet
included in the Financial Statements and which will not individually or in the
aggregate be material to NSCB and the Bank, taken as a whole; and (c) fees,
costs and expenses incurred in connection with the transaction contemplated by
this Agreement. To the best knowledge of NSCB, there is no basis for assertion
against the Bank or NSCB of any Liabilities, except as described in clauses
(a), (b) and (c) of this Section 3.6.

3.7 ABSENCE OF CERTAIN CHANGES. Since December 31, 1995, there
has not been:

(a) any material adverse change in the condition
(financial or otherwise) of the properties, assets, liabilities, results of
operation or business prospects of NSCB and the Bank taken as a whole;

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(b) any declaration, setting aside or payment of any
dividend or other distribution in respect of the capital stock of NSCB;

(c) any increase in the type or amounts of compensation,
commissions, perquisites payable or to become payable by the Bank or NSCB to
any director, officer, employee or agent thereof, or any payment of any bonus,
profit sharing or other extraordinary compensation to any such person, other
than in the ordinary course of business;

(d) any cancellation of any debts owed to or claims held
by or on behalf of NSCB or the Bank;

(e) any actual or threatened termination of any business
relationships or material agreements with the Bank or NSCB and any of their
respective material customers or suppliers;

(f) any occurrence of any obligation or liability
(absolute or contingent) for indebtedness, except routine operating expenses
and contract obligations incurred in the ordinary course of business; or any
acceleration in the payment of, or payment other than in the ordinary course of
the Bank's or NSCB's business and consistent with past custom and practices
thereof, of any indebtedness or amounts due or payable thereunder;

(g) any mortgage, encumbrance, sale, lease, abandonment
or other disposition, other than in the ordinary course of business and for
fair value, of any equipment or other properties, or any tangible assets
utilized by the Bank or NSCB;

(h) any material change in the accounting policies,
procedures or practices with respect to NSCB or the Bank; or

(i) any other material transaction outside the ordinary
course of business consistent with past practices.

3.8 TAXES. As used herein, the term "Taxes" means all federal,
state, county, local and foreign income, excise, property, sales, use, payroll,
intangibles, franchise, transfer, and other taxes of whatever nature, all
penalties related to such taxes and interest on such taxes and penalties. All
returns and reports relating to Taxes (the "Tax Returns") required to be filed
by each of the Bank and NSCB through the date hereof have been, and as to Tax
Returns required to be filed through the Closing Date will be, timely filed
with the appropriate governmental agencies in all jurisdictions in which such
Tax Returns were or are required to be filed, and all such Tax Returns are or
will be true and correct and prepared in accordance with applicable law and
regulations and properly reflect, or will properly reflect, the Taxes for the
periods covered thereby.

All Taxes due and payable by the Bank and NSCB with respect to all
periods prior to and through the date hereof have been, and through the Closing
Date will be, duly and properly

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computed, reported, fully paid and discharged, and there will not be any unpaid
Taxes with respect to any period through the Closing Date, which are or could
become a lien on the assets of the Bank or NSCB, or the Bank's or NSCB's
capital stock, except for current Taxes not yet due and payable. Adequate
accruals on the Financial Statements have been made for the payment of all
accrued and unpaid Taxes, whether or not disputed, for all fiscal periods
through the date hereof or arising out of transactions entered into or any
state of facts existing on or prior thereto; and for such periods, and all
periods prior to and through the date hereof have been, and through the Closing
Date will be, properly accrued on the books and financial records of the Bank
and NSCB in accordance with GAAP in amounts sufficient for the payment of all
unpaid Taxes required to be paid by the Bank and NSCB with respect to such
periods.

There are no known or proposed penalty, interest or deficiency
assessments or bases therefor with respect to Taxes of the Bank or NSCB, that
require payment by, relate to or could adversely affect the Bank or NSCB or any
of their respective assets. There have been no audits conducted by any taxing
authority on the Tax Returns of the Bank or NSCB since inception. The Bank and
NSCB have not waived any law or regulation fixing, or consented to the
extension of, any period of time for the assessment of any Taxes, which waiver
or consent is currently in effect. All Taxes that the Bank and NSCB are or
were required by law to withhold or collect have been duly withheld and
collected and, to the extent required, has been paid to the proper governmental
body or other person or entity.

3.9 CONDITION OF PROPERTIES. To the best knowledge of NSCB, the
tangible personal and/or real properties (whether owned or leased) of the Bank
and NSCB are in reasonably good condition and repair in all respects; are
suitable for the purposes intended; and said properties and the uses thereof
are in compliance with all applicable laws, ordinances and governmental rules
and regulations.

Neither the property described herein, nor any improvements located
thereon are the subject of any complaint nor are they in violation of nor is
there a basis for a claim to correct a violation, or any applicable building,
zoning, occupancy or other restriction, law, ordinance, or similar regulation.
No condemnation proceedings are pending or have within the past two (2) years
been threatened against such real property or, to the best of NSCB's knowledge,
any other property which would affect the ability of the Bank or NSCB to use
the real property described herein, in the ordinary course of any of the Bank's
or NSCB's business, nor has any notice been received by NSCB of any such
expropriation or dedication or proposed expropriation or dedication.

3.10 CONTRACTS. All of the oral and written contracts, agreements
and commitments or understanding which are material in nature to the operation
of NSCB's and the Bank's business ("Contracts") constitute legal, valid and
binding obligations of the respective parties thereto, are in full force and
effect, and to the knowledge of NSCB, no other party thereto has violated any
provision of, or committed or failed to perform any act which with notice,
lapse of time or both would constitute a material default under or otherwise
alter the provisions of any Contract, the termination or alteration of which
could have a material adverse effect upon the

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properties, assets, liabilities, financial condition, results of operations or
business prospects of the Bank or NSCB.

None of the Bank's and NSCB's rights under the Contracts will be
materially affected by the Reorganization.

3.11 NO DEFAULT, VIOLATION OR LITIGATION. The Bank and NSCB have
complied in all material respects with all applicable federal, state, local and
foreign laws, regulations or orders of any court or federal, state, municipal
or other governmental department, commission, board, bureau, agency or
instrumentality (including, without limitation, laws, regulations, orders,
restrictions and compliance schedules applicable to environmental standards and
controls, wages and hours, civil rights and occupational health and safety,
together with all applicable laws regarding fair lending and the Community
Reinvestment Act) (the "Laws") except where the failure to so comply could
reasonably expect to have a material adverse effect on the operations of the
Bank and/or NSCB taken as a whole and neither the Bank nor NSCB has received
any notice of claimed noncompliance. Furthermore, (i) there are no lawsuits,
proceedings, claims or governmental investigations pending or, to the knowledge
of NSCB, threatened against or involving, the Bank or NSCB or against or
involving any of their respective properties or businesses, or against or
involving any officers or directors of the Bank or NSCB and which could
materially and adversely affect the Bank or NSCB; (ii) there is no basis known
to NSCB for any such action which could have an adverse effect upon the
properties, assets, liabilities, financial condition, results of operations or
business prospects of the Bank or NSCB or their right to conduct their
businesses as presently conducted; and (iii) there are no judgments, consents,
decrees, injunctions, or any other judicial or administrative mandates
outstanding against the Bank or NSCB which materially and adversely affect the
properties, assets, liabilities, financial condition, results of operations or
business prospects of the Bank or NSCB or their right to conduct their
respective businesses as presently conducted.

3.12 INSURANCE. The Bank and NSCB maintain insurance policies in
amounts and against such risks as are usual and customary and adequate to
protect their respective businesses and properties. All such policies are (and
pending Closing will continue to be) in full force and effect, and neither the
Bank nor NSCB are in default in any material respect with respect to any
provision contained in any insurance policies, nor has the Bank or NSCB failed
to give any notice or present any claim thereunder in due and timely fashion.
At no time has the Bank or NSCB been denied any insurance or indemnity bond
coverage which it has requested, or received any written notice from or on
behalf of any insurance carrier presently providing insurance relating to them
(i) that insurance rates may or will be substantially increased, (ii) that
there will be no renewal of policies presently in effect, or (iii) that
material alterations to any of the properties or business operations of the
Bank and NSCB is necessary or required by such carrier. None of such insurance
policies are subject to retroactive premium adjustment in respect of prior
periods.

3.13 EMPLOYMENT, LABOR AND OTHER RELATIONS. Neither the Bank nor
NSCB is a party to or otherwise bound by any contract, agreement or collective
bargaining agreement with

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any labor union or organization or other commitment respecting employment or
compensation of any of its officers, directors, agents or employees, and no
employees of the Bank or NSCB are represented by any labor union or similar
organization. NSCB is not aware of any existing or threatened labor
disturbance by NSCB's or the Bank's employees which could have a material
adverse effect upon the properties, assets, liabilities, financial condition,
results of operations or business prospects of NSCB or the Bank.

There are no charges or complaints involving any federal, state or
local civil rights enforcement agency or court; complaints or citations under
the Occupational Safety and Health Act or any state or local occupational
safety act or regulation; unfair labor practice charges or complaints with the
National Labor Relations Board; or other claims, charges, actions or
controversies pending, or, to the knowledge of NSCB, threatened or proposed,
involving NSCB or the Bank, or any employee, former employee or any labor union
or other organization representing or claiming to represent such employees'
interests, which could materially and adversely affect the business of NSCB,
taken as a whole.

NSCB and the Bank are and have heretofore been in compliance in all
material respects with all laws, rules and regulations respecting employment
and employment practices, terms and conditions of employment and wages and
hours, the sponsorship, maintenance, administration and operation of (or the
participation of its employees in) employee benefit plans and arrangements and
occupational safety and health programs, and neither NSCB nor the Bank is
engaged in any violation of any law, rule or regulation related to employment,
including unfair labor practices or acts of employment discrimination, which
could materially and adversely affect the business of NSCB, taken as a whole.

3.14 EMPLOYEE BENEFITS. As used herein, the term "Employee Plan"
includes any pension, profit sharing, retirement, savings, disability, medical,
dental, health, life (including any individual life insurance policy to which
the Bank or NSCB make premium payments, whether or not the Bank or NSCB are the
owners, beneficiaries or both of such policy), death benefit, group insurance,
profit sharing, deferred compensation, stock option, bonus, incentive, vacation
pay, severance pay, or other similar employee plan, trust, arrangement,
contract, agreement, policy or commitment (including without limitation, any
pension plan ("Pension Plan") as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), and any welfare
plan as defined in Section 3(1) of ERISA ("Welfare Plan")), whether any of the
foregoing is funded, insured or self-funded, written or oral, (a) to which
either the Bank or NSCB is a party or by which either the Bank or NSCB (or any
of the rights, properties or assets of the Bank or NSCB) are bound, or (b) with
respect to which the Bank or NSCB have made any payments, contributions or
commitments since December 31, 1995, or may otherwise have any liability
(whether or not the Bank or NSCB still maintain such plan, trust, arrangement,
contract, agreement, policy or commitment). With respect to the Employee
Plans:

(a) The terms of all of the Bank's and NSCB's Employee
Plans have been disclosed to the Surviving Companies.

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(b) The financial and actuarial statements, if any, for
each Employee Plan reflect in all material respects the financial condition and
funding of the Employee Plans as of the date of such financial and actuarial
statements, and no adverse change has occurred with respect to the financial
condition or funding of the Employee Plans since the date of such financial and
actuarial statements.

3.15 PATENTS, TRADEMARKS AND LICENSES. NSCB and the Bank own,
possess or have licenses or similar rights to utilize all patents, trademarks,
trade names, service marks, franchises, and technology necessary for the
conduct of their business as presently conducted without any infringement of or
conflict with the rights of others.

3.16 ENVIRONMENTAL MATTERS. To the knowledge of NSCB, all
facilities leased, used or operated by NSCB and the Bank have been, and
continue to be, leased, used or operated in compliance in all material respects
with all applicable federal, state, local and foreign environmental laws,
regulations, and guidelines as enacted, amended or reauthorized, promulgated,
published or proposed.

3.17 OTHER MATERIAL ADVERSE INFORMATION. No representation or
warranty of NSCB made hereunder or in the Schedules or Exhibits attached hereto
or in any other document delivered by NSCB contains any untrue statement of a
material fact or omits a material fact necessary in order to make the
statements contained herein or therein not misleading.

3.18 DISINTERESTED DIRECTORS APPROVAL. This Agreement and the
proposed Reorganization have been approved by a majority of the Disinterested
Directors of NSCB. For purposes of this Agreement, the term "Disinterested
Directors" shall have the meaning set forth in the BCA.

4. REPRESENTATIONS AND WARRANTIES OF SURVIVING COMPANIES

Each of the Surviving Companies, solely with respect to itself and its
respective Surviving Subsidiary or Surviving Subsidiaries (as such term is
defined in Section 4.2), severally and not jointly represents to NSCB and each
other Surviving Company as follows:

4.1 ORGANIZATION, POWER AND QUALIFICATION. With the exception of
LFB and Crabtree, each Surviving Company is an Illinois corporation, duly
organized and validly existing under the laws of the State of Illinois and has
all requisite corporate power and authority to own or hold under lease its
properties and assets and to carry on its business as now conducted. Each of
LFB and Crabtree is a Delaware corporation, duly organized and validly existing
under the laws of the State of Delaware and each of the aforesaid has all
requisite power and authority to own or hold under lease its properties and
assets and to carry on its business as now conducted.

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4.2 SUBSIDIARIES.

(a) LFB. The sole subsidiary of LFB is Lake Forest Bank
& Trust Company, an Illinois state banking corporation located at 727 N. Bank
Lane, Lake Forest, Illinois 60045.

(b) HB. The sole subsidiary of HB is Hinsdale Bank &
Trust Company, an Illinois state banking corporation located at 25 E. First
Street, Hinsdale, Illinois 60521.

(c) LB. The sole subsidiary of LB is Libertyville Bank &
Trust Company, an Illinois state banking corporation located at 507 N.
Milwaukee Avenue, Libertyville, Illinois 60048.

(d) Crabtree. The direct subsidiaries of Crabtree are
(i) First Premium, an Illinois corporation located at 520 Lake Cook Road,
Deerfield, Illinois, and Credit Life, a Delaware corporation which is a
non-operating business. In accordance with Section 6.11 hereof, it is
contemplated that Credit Life will be merged with and into First Premium prior
to the Effective Date. First Premium has three wholly-owned subsidiaries:
(i) First Premium Financing Corporation, an Illinois corporation; (ii) First
Premium Services, Inc. of New York, a New York corporation; and (iii) First
Premium Services, Inc. of California, a California corporation; and Credit Life
has one remaining subsidiary, CL Reinsurance, Inc., a British Virgin Islands
corporation.

Lake Forest Bank & Trust Company, Hinsdale Bank & Trust
Company, Libertyville Bank & Trust Company and First Premium, are sometimes
collectively referred to herein as the "Surviving Subsidiaries".

Each of the Surviving Subsidiaries has been duly organized and
is validly existing and has all requisite corporate power and authority to own
and hold under lease their respective properties and assets and to carry on
their respective businesses as now conducted.

4.3 CAPITALIZATION. Schedule 4.3 to this Agreement sets forth the
number and shares of class of capital stock of the Surviving Company and its
respective Surviving Subsidiaries which is authorized, issued and outstanding,
or held as treasury shares, including without limitation, any and all options,
warrants, rights to purchase shares of such stock or other instruments or
agreements of any kinds providing rights to acquire shares of or other
interests in such stock.

4.4 AUTHORIZATION; NON-CONTRAVENTION; CONSENTS. The Surviving
Company has all requisite power and authority to enter into this Agreement and
the Plan of Merger, to consummate the transactions contemplated hereby and
thereby and otherwise to carry out its obligations hereunder. The execution,
delivery and performance of this Agreement and the Plan of Merger and the
consummation of the transactions contemplated hereby and thereby have been duly
authorized by all necessary corporate action on the part of the Surviving
Company. This Agreement constitutes, and all other agreements and documents to
be executed and delivered by

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the Surviving Company pursuant hereto will constitute the valid and binding
agreements of the Surviving Company enforceable against it in accordance with
their respective terms (subject, as to the enforcement of remedies, to general
principles of equity and to bankruptcy, insolvency and similar laws affecting
creditors' rights generally).

The execution and delivery of this Agreement and the Plan of Merger by
the Surviving Company does not, and the consummation by the Surviving Company
of the transactions contemplated hereby and thereby does not and will not,
constitute or result in (with or without the giving of notice or the lapse of
time or both) (a) a breach or violation of, or a default under, any provision
of the articles or certificate of incorporation or by-laws of the Surviving
Company, or (b) a material breach or violation of, or a conflict with, or a
material default under, or termination of, or an event permitting any other
person to terminate, or the acceleration of, or the creation or imposition of
any lien, charge, pledge, security interest or other encumbrance on any
properties or assets of the Surviving Company pursuant to any provision of any
contract, license or other agreement binding upon the Surviving Company or any
law, rule, decree, regulation, ordinance or order, award or governmental permit
or license applicable to the Surviving Company or any of its properties or
assets.

No consent of, or notice to, or filing with any federal, state or
local authority, or any other person or entity is required to be obtained,
given or made by the Surviving Company in connection with the execution,
delivery or performance of this Agreement or any other agreement or document to
be executed, delivered and performed by the Surviving Company pursuant hereto
(except for any filings required under federal or state banking laws).

4.5 FINANCIAL STATEMENTS. The Surviving Company has made
available to NSCB its consolidated balance sheets as of December 31, 1993, 1994
and 1995 (if then in existence), and the related statements of income, changes
in the shareholders equity and cash flows for the years then ended (or if
shorter, since inception).

The term "Financial Statements" as used in this Section 4 shall mean
the above-described consolidated financial statements of the Surviving Company.

The Financial Statements are complete and accurate and fairly present
the assets, liabilities and financial condition of the Surviving Company and
its Surviving Subsidiaries at the date thereof, and the statement of income and
retained earnings and changes in financial position and the notes thereto
included in the Financial Statements are complete and accurate and fairly
present the results of operations for the periods therein referred to, all in
accordance with GAAP.

4.6 UNDISCLOSED LIABILITIES. Except as may have been specifically
disclosed to the other parties hereto prior to the date of this Agreement, the
Surviving Company has no Liabilities except (a) as reflected, reserved for or
given effect to in the Financial Statements; (b) routine operating expenses and
contract obligations incurred in the ordinary course of business since December
31, 1995, and which will not individually or in the aggregate be material to
the

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respective Surviving Company; and (c) fees, costs and expenses incurred in
connection with the transaction contemplated by this Agreement. To the best
knowledge of the Surviving Company, there is no basis for assertion against the
Surviving Company, or its respective Surviving Subsidiaries of any Liabilities,
except as described in clauses (a), (b) and (c) of this Section 4.6.

4.7 ABSENCE OF CERTAIN CHANGES. Since December 31, 1995 there has
not been:

(a) any material adverse change in the condition
(financial or otherwise) of the properties, assets, liabilities, results of
operation or business prospects of the Surviving Company or its respective
Surviving Subsidiaries;

(b) any declaration, setting aside or payment of any
dividend or other distribution in respect of the capital stock of the Surviving
Company and its respective Surviving Subsidiaries;

(c) any increase in the type or amounts of compensation,
commissions, perquisites payable or to become payable by the Surviving Company
and its respective Surviving Subsidiaries to any director, officer, employee or
agent thereof, or any payment of any bonus, profit sharing or other
extraordinary compensation to any such person, other than in the ordinary
course of business;

(d) any cancellation of any debts owed to or claims held
by or on behalf of the Surviving Company or its respective Surviving
Subsidiaries;

(e) any actual or threatened terminations of any business
relationships or material agreements between the Surviving Company and its
respective Surviving Subsidiaries and any of their respective material
customers or suppliers;

(f) any occurrence of any obligation or liability
(absolute or contingent) for indebtedness, except routine operating expenses
and contract obligations incurred in the ordinary course of business; or any
acceleration in the payment of, or payment other than in the ordinary course of
business of the Surviving Company and its Surviving Subsidiaries and consistent
with past custom and practices thereof, of any indebtedness or amounts due or
payable thereunder;

(h) any material change in the accounting policies,
procedures or practices with respect to the Surviving Company or its respective
Surviving Subsidiaries; or

(i) any other material transaction other than in the
ordinary course of business consistent with past practices.

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4.8 TAXES. All the Tax Returns required to be filed by the
Surviving Company and its respective Surviving Subsidiaries through the date
hereof have been, and as to Tax Returns required to be filed through the
Closing Date will be, timely filed with the appropriate governmental agencies
in all jurisdictions in which such Tax Returns were or are required to be
filed, and all such Tax Returns are or will be true and correct and prepared in
accordance with applicable law and regulations and properly reflect, or will
properly reflect, the Taxes for the periods covered thereby.

All Taxes due and payable by the Surviving Company and its respective
Surviving Subsidiaries with respect to all periods prior to and through the
date hereof have been, and through the Closing Date will be, duly and properly
computed, reported, fully paid and discharged, and there will not be any unpaid
Taxes with respect to any period through the Closing Date, which are or could
become a lien on the assets of the Surviving Company and its respective
Surviving Subsidiaries, or the Surviving Company and its respective Surviving
Subsidiaries' capital stock, except for current Taxes not yet due and payable.
Adequate accruals on the Financial Statements have been made for the payment of
all accrued and unpaid Taxes, whether or not disputed, for all fiscal periods
through the date hereof or arising out of transactions entered into or any
state of facts existing on or prior thereto; and for such periods, and all
periods prior to and through the date hereof have been, and through the Closing
Date will be, properly accrued on the books and financial records of the
Surviving Company and its respective Surviving Subsidiaries in accordance with
GAAP and in amounts sufficient for the payment of all unpaid Taxes required to
be paid by the Surviving Company and its respective Surviving Subsidiaries with
respect to such periods.

There are no known or proposed penalty, interest or deficiency
assessments or bases therefor with respect to Taxes of the Surviving Company
and its respective Surviving Subsidiaries that require payment by, relate to or
could adversely affect the Surviving Company and its respective Surviving
Subsidiaries or any of their respective assets. There have been no audits
conducted by any taxing authority on the Tax Returns of the Surviving Company
and its respective Surviving Subsidiaries during the most recent five (5)
fiscal years (or if shorter, since inception). The Surviving Company and its
respective Surviving Subsidiaries have not waived any law or regulation fixing,
or consented to the extension of, any period of time for the assessment of any
Taxes, which waiver or consent is currently in effect. All Taxes that the
Surviving Company and its respective Surviving Subsidiaries are or were
required by law to withhold or collect have been duly withheld and collected
and, to the extent required, has been paid to the proper governmental body or
other person or entity.

4.9 CONDITION OF PROPERTIES. To the best knowledge of the
respective Surviving Company, the tangible personal and real properties
(whether owned or leased) of such Surviving Company and its respective
Surviving Subsidiaries are in reasonably good condition and repair in all
respects; are suitable for the purposes intended; and said properties and the
uses thereof are in compliance with all applicable laws, ordinances and
governmental rules and regulations.

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Neither the property described herein, nor any improvements located
thereon are the subject of any complaint nor are they in violation of nor is
there a basis for a claim to correct a violation, or any applicable building,
zoning, occupancy or other restriction, law, ordinance, or similar regulation.
No condemnation proceedings are pending or have within the past two (2) years
been threatened against such real property or, to the best of the Surviving
Company's knowledge, any other property which would affect the ability of the
Surviving Company and its respective Surviving Subsidiaries to use the real
property described herein, in the ordinary course of the Surviving Company's
and its respective Surviving Subsidiaries' business, nor has any notice been
received by the Surviving Company and its Surviving Subsidiaries of any such
expropriation or dedication or proposed expropriation or dedication.

4.10 CONTRACTS. All of the Contracts to which the Surviving
Company is a party, and which are material to the operation of the Surviving
Company or its Surviving Subsidiaries constitute legal, valid and binding
obligations of the Surviving Company, are in full force and effect, and to the
knowledge of the Surviving Company, no other party thereto has violated any
provision of, or committed or failed to perform any act which with notice,
lapse of time or both would constitute a default under or otherwise alter the
provisions of any Contract, the termination or alteration of which could have a
material adverse effect upon the properties, assets, liabilities, financial
condition, results of operations or business prospects of the Surviving Company
or its Surviving Subsidiaries.

None of the Surviving Company's rights under the Contracts will be
materially affected by the proposed Reorganization.

4.11 NO DEFAULT, VIOLATION OR LITIGATION. The Surviving Company
and its Surviving Subsidiaries have complied in all material respects with all
applicable Laws where the failure to so comply could reasonably expect to have
a material adverse effect on the operations of the Surviving Company and its
respective Surviving Subsidiaries and neither the Surviving Company nor its
respective Surviving Subsidiaries have received any notice of claimed
noncompliance. Furthermore, (i) there are no lawsuits, proceedings, claims or
governmental investigations pending or, to the knowledge of any of the
Surviving Companies, threatened against or involving, the Surviving Company or
its respective Surviving Subsidiaries or against or involving any of their
respective properties or businesses, or against or involving any officers or
directors of the Surviving Company or its respective Surviving Subsidiaries and
which could materially and adversely affect the Surviving Company or its
respective Surviving Subsidiaries; (ii) there is no basis known to the
Surviving Company for any such action which could have an adverse effect upon
the properties, assets, liabilities, financial condition, results of operations
or business prospects of the Surviving Company or its respective Surviving
Subsidiaries or their right to conduct their respective businesses as presently
conducted; and (iii) there are no judgments, consents, decrees, injunctions, or
any other judicial or administrative mandates outstanding against the Surviving
Company and its respective Surviving Subsidiaries which materially and
adversely affect the properties, assets, liabilities, financial condition,
results of operations or business prospects of the Surviving Company and its
respective Surviving Subsidiaries or their right to conduct their respective
businesses as presently conducted.

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4.12 INSURANCE. The Surviving Company and its respective Surviving
Subsidiaries maintain insurance policies in amounts and against such risks as
are usual and customary and adequate to protect their respective business and
properties. All such policies are (and pending Closing will continue to be) in
full force and effect, and neither the Surviving Company nor its respective
Surviving Subsidiaries are in default in any material respect with respect to
any provision contained in any insurance policies, nor have the Surviving
Company and its respective Surviving Subsidiaries failed to give any notice or
present any claim thereunder in due and timely fashion. At no time has the
Surviving Company and its respective Surviving Subsidiaries been denied any
insurance or indemnity bond coverage which it has requested, or received any
written notice from or on behalf of any insurance carrier presently providing
insurance relating to them (i) that insurance rates may or will be
substantially increased, (ii) that there will be no renewal of policies
presently in effect or (iii) that material alterations to any of the properties
or business operations of the Surviving Company and its respective Surviving
Subsidiaries is necessary or required by such carrier. None of such insurance
policies are subject to retroactive premium adjustment in respect of prior
periods.

4.13 EMPLOYMENT, LABOR AND OTHER RELATIONS. Neither the Surviving
Company nor its Surviving Subsidiaries is a party to or otherwise bound by any
contract, agreement or collective bargaining agreement with any labor union or
organization or other commitment respecting employment or compensation of any
of its officers, directors, agents or employees, and no employees of the
Surviving Company and its respective Surviving Subsidiaries are represented by
any labor union or similar organization. The Surviving Company is not aware of
any existing or threatened labor disturbance by any of the Surviving Companies'
and Surviving Subsidiaries' employees which could have a material adverse
effect upon the properties, assets, liabilities, financial condition, results
of operations or business prospects of the Surviving Company or its respective
Surviving Subsidiaries.

There are no charges or complaints involving any federal, state or
local civil rights enforcement agency or court; complaints or citations under
the Occupational Safety and Health Act or any state or local occupational
safety act or regulation; unfair labor practice charges or complaints with the
National Labor Relations Board; or other claims, charges, actions or
controversies pending, or, to the knowledge of the Surviving Company,
threatened or proposed, involving the Surviving Company and its respective
Surviving Subsidiaries and any employee, former employee or any labor union or
other organization representing or claiming to represent such employees'
interests, which could materially and adversely affect the business of the
Surviving Company or its respective Surviving Subsidiaries.

The Surviving Company and its respective Surviving Subsidiaries are
and have heretofore been in compliance in all material respects with all laws,
rules and regulations respecting employment and employment practices, terms and
conditions of employment and wages and hours, the sponsorship, maintenance,
administration and operation of (or the participation of its employees in)
employee benefit plans and arrangements and occupational safety and health
programs, and neither the Surviving Company nor its respective Surviving
Subsidiaries are engaged in any violation of any law, rule or regulation
related to employment, including unfair

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labor practices or acts of employment discrimination, which could materially
and adversely affect the business of the Surviving Company or its respective
Surviving Subsidiaries.

4.14 EMPLOYEE BENEFITS. As used herein, the term "Employee Plan"
includes any pension, profit sharing, retirement, savings, disability, medical,
dental, health, life (including any individual life insurance policy to which
the Surviving Company and its respective Surviving Subsidiaries make premium
payments, whether or not the Surviving Company and its respective Surviving
Subsidiaries are the owners, beneficiaries or both of such policy), death
benefit, group insurance, profit sharing, deferred compensation, stock option,
bonus, incentive, vacation pay, severance pay, or other similar employee plan,
trust, arrangement, contract, agreement, policy or commitment (including
without limitation, any Pension Plan and any Welfare Plan, whether any of the
foregoing is funded, insured or self-funded, written or oral, (a) to which the
Surviving Company and its respective Surviving Subsidiaries are a party or by
which the Surviving Company and its respective Surviving Subsidiaries (or any
of the rights, properties or assets of the Surviving Company and its respective
Surviving Subsidiaries) are bound, or (b) with respect to which the Surviving
Company and its respective Surviving Subsidiaries have made any payments,
contributions or commitments since December 31, 1995, or may otherwise have any
liability (whether or not the Surviving Company and its respective Surviving
Subsidiaries still maintain such plan, trust, arrangement, contract, agreement,
policy or commitment). With respect to the Employee Plans:

(a) The terms of all of Surviving Companies' and
Surviving Subsidiaries' Employee Plans have been disclosed to the Merging
Companies and NSCB.

4.15 PATENTS, TRADEMARKS AND LICENSES. The Surviving Company and
its respective Surviving Subsidiaries own, possess or have licenses or similar
rights to utilize all patents, trademarks, trade names, service marks,
franchises, and technology necessary for the conduct of their business as
presently conducted without any infringement of or conflict with the rights of
others.

4.16 ENVIRONMENTAL MATTERS. To the best knowledge of the Surviving
Company, all facilities leased, used or operated by any of the Surviving
Company and its respective Surviving Subsidiaries have been, and continue to
be, leased, used or operated in compliance in all material respects with all
applicable federal, state, local and foreign environmental laws, regulations,
and guidelines as enacted, amended or reauthorized, promulgated, published or
proposed.

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4.17 OTHER MATERIAL ADVERSE INFORMATION. No representation or
warranty of the Surviving Company made hereunder or in the Schedules or
Exhibits attached hereto or in any other document delivered by the Surviving
Company contains any untrue statement of a material fact or omits a material
fact necessary in order to make the statements contained herein or therein not
misleading.

4.18 DISINTERESTED DIRECTORS APPROVAL. This Agreement and the
proposed Reorganization have been approved by a majority of the Disinterested
Directors of the Surviving Company.

5. COVENANTS AND ADDITIONAL AGREEMENTS

Each of the Merging Companies, the Surviving Companies and NSCB,
covenants and agrees with each of the other parties that, from the date hereof
until the earlier of the Effective Date or termination of this Agreement,
unless otherwise consented to by each of the other parties to this Agreement,
it will comply with the following:

5.1 CONDUCT OF BUSINESS PENDING CONSUMMATION OF MERGER; NO
MATERIAL CHANGE. Each of the Surviving Companies, the Merging Companies and
NSCB agrees to operate and conduct their respective businesses, only in the
ordinary course consistent with past practices except as otherwise may be
provided for herein and, without limiting the foregoing, will:

(a) not make any material change in its business or
operations, it being understood that for purposes hereof the opening of a
branch banking facility shall be deemed to be in the ordinary course of
business;

(b) maintain its property and physical assets in as good
a state of operating condition and repair as they are on the date hereof,
except for ordinary depreciation and wear and tear;

(c) not sell, pledge, lease, mortgage, encumber or
otherwise dispose of any of its assets, other than pursuant to transactions in
the normal course of business for fair value or (in the case of First Premium
and First Premium Financing Corporation ("FPFC")) as contemplated in the
Receivables Purchase and Sale Agreement dated as of January 31, 1995, between
First Premium and FPFC, and except for pledges of subsidiary stock to secure
revolving lines of credit by any of the Surviving Companies or NSCB on terms no
less favorable than existing lines of credit;

(d) keep in force all policies of insurance covering the
business, properties and assets of the any of the Surviving Companies, NSCB or
any of their subsidiaries and all policies of insurance providing for directors
and officers errors and omission coverage except as same may be replaced with
policies of insurance providing substantially similar coverage;

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(e) except as otherwise contemplated herein or as
provided for above in clause (iii) above, not incur or agree to incur any
obligations to issue, sell, pledge or dispose of, or otherwise encumber, any of
its shares of capital stock, or any options, rights, or other securities
convertible into such shares, options, rights or other securities, except that
nothing provided herein shall prevent the issuance of common stock pursuant to
(i) the exercise of currently outstanding stock options, rights or warrants or
(ii) the conversion of currently outstanding shares of preferred stock into
shares of common stock;

(f) not authorize or pay or agree to pay or accrue any
increased wage, salary or other remuneration of the directors, officers or
other key employees or agents of any of the Surviving Companies, the Surviving
Subsidiaries, the Bank or NSCB and will not authorize or make any material
changes in compensation or policy regarding compensation payable or to become
payable to any directors, officers or other employees, of any of the Surviving
Companies, the Surviving Subsidiaries, the Bank or NSCB;

(g) not declare, set aside or pay any dividends on, or
make any other actual, constructive or deemed distributions in respect of, any
of its respective capital stock, or otherwise make any payments to its
respective shareholders or stockholders in their capacity as such; except as
contemplated in this Agreement, split, combine or reclassify any of it 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 or any rights,
warrants or options to acquire any such shares; or, except as contemplated in
this Agreement, purchase, redeem or otherwise acquire any shares of their
respective capital stock or any rights, warrants or options to acquire any such
shares;

(h) not amend its Articles of Incorporation or
Certificate of Incorporation (as the case may be) or amend in any material
respect its By-Laws, except as provided for herein;

(i) not acquire or agree to acquire by merging or
consolidating with, or by purchasing a portion of the assets of or equity in,
or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof;

(j) not change any accounting policies, procedures or
practices currently employed by it except for any such changes as may be
required to be implemented by GAAP or any other such changes which will not
have material effect on its financial condition or results of operations; or

(k) not enter into any material contract, agreement or
lease or make any material change in any existing contracts, agreements or
leases except in the ordinary course of business consistent with past
practices.

5.2 MAINTAIN SURVIVING COMPANIES, SURVIVING SUBSIDIARIES, THE BANK
AND NSCB AS GOING CONCERNS. Each of the Surviving Companies and NSCB will
preserve, and will cause its respective operating subsidiary to preserve, their
respective business organizations and will

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use best efforts to keep available the services of their respective present
officers, key employees, and agents, and will use their best efforts to
preserve the goodwill of their key suppliers, customers and others having
material business relations therewith, except in each case where the loss of
such services or relationships will not have a material adverse effect on the
financial condition or business prospects of the Resulting Company.

5.3 PRESERVE ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each of
the Surviving Companies and NSCB will use its best efforts to avoid any action
which would render any representation and/or warranty contained in this
Agreement untrue in any material respect as of the Effective Date, except for
changes specified in, permitted or contemplated by this Agreement or any such
actions which would not have a material adverse effect on the business
prospects or financial condition of the Resulting Company.

5.4 EXTENSION OF CREDIT. Except in the usual and ordinary course
of business or loans by one party hereto to another party hereto on terms
consistent with any applicable law, rule or regulation, none of the Surviving
Companies or NSCB shall make, nor shall they permit their respective
subsidiaries to make, any extension of credit or commitment to make any
extension of credit not consistent with their current lending policies or in
excess of their current internal lending limits or to any customer who is
listed on their respective loan watch list as of the date of the execution of
this Agreement, except with the prior consent of the other parties hereto.

5.5 BORROWING. None of NSCB, the Merging Companies or the
Surviving Companies will, nor will they permit their respective subsidiaries
to, borrow any money other than in the usual and ordinary course of business
and except pursuant to terms no less favorable than the terms of their existing
lines of credit, if any; provided, however, any borrowing by NSCB in an amount
less than $3 million shall be deemed to be in the ordinary course of
business.

5.6 SUPPLEMENTS TO SCHEDULES. From time to time prior to the
Effective Date, each of the Surviving Companies and NSCB will promptly
supplement or amend any Schedules provided for in this Agreement (i) if any
matter arises hereafter which, if existing or occurring at or prior to the date
of this Agreement, would have been required to be set forth or described in any
such Schedule, or (ii) if it becomes necessary to correct any information in
any such Schedule which has become inaccurate; provided, however, that no such
supplement or amendment to any Schedule shall be considered in determining
satisfaction of the condition set forth in Section 6 of this Agreement.

5.7 BEST EFFORTS. Each of the Surviving Companies and NSCB agree
to use their best efforts to cause to be satisfied the conditions precedent to
the Merger set forth in Section 6 and will take all other actions and do, or
cause to be done, all things necessary, proper or advisable to consummate and
make effective the transactions contemplated by this Agreement.

5.8 REGISTRATION STATEMENT; SHAREHOLDER APPROVAL. As soon as
practicable after the date hereof, NSCB shall cause to be prepared and filed
with the SEC a Registration

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Statement on Form S-4 covering the NSCB Common Stock to be issued to holders of
LFB, HB, LB, and Crabtree Common Stock in the Reorganization, which
Registration Statement shall include the joint proxy statement for use in
soliciting proxies for special meetings of shareholders to be held by each of
LFB, HB, LB, Crabtree and NSCB for purposes of considering the Reorganization,
and each of LFB, HB, LB, Crabtree and NSCB shall use their best efforts to
cause the Registration Statement to become effective under the Securities Act.
NSCB will take any action (other than qualifying to do business in any
jurisdiction in which it is now not so qualified) required to be taken under
the applicable blue sky or securities laws in connection with the issuance of
the shares of NSCB Common Stock in the Reorganization. Each party shall
furnish all information concerning it and the holders of its capital stock as
the other parties to this Agreement may reasonably request in connection with
such action. Each party shall call a shareholders' meeting to be held as soon
as reasonably practicable after the date of this Agreement for the purpose of
voting upon this Agreement and the Reorganization (the "Shareholders'
Meetings"). In connection with the Shareholders' Meetings, (a) NSCB, LFB, HB,
LB, and Crabtree shall jointly cause to be prepared the joint proxy statement
as part of the Registration Statement, and NSCB, LFB, HB, LB, and Crabtree
shall each mail the joint proxy statement to their respective shareholders, on
a date mutually acceptable to the parties hereto (the "Mailing Date'); (b) the
Boards of Directors of NSCB, LFB, HB, LB, and Crabtree shall recommend to their
respective shareholders the approval of this Agreement and the transactions
contemplated by the Reorganization; and (c) the Boards of Directors of NSCB,
LFB, HB, LB, and Crabtree shall otherwise use their best efforts to the extent
consistent with their respective fiduciary duties to obtain such shareholder
approvals.

5.9 CONSENTS. Each of the Merging Companies, the Surviving
Companies and NSCB shall use their best efforts to obtain all consents,
authorizations, orders and approvals of, and make all filings and registrations
with, any governmental commission, board or other regulatory body or any other
person required for or in connection with the consummation by it of the
transactions contemplated hereby and will cooperate fully with the other
parties hereto in obtaining such consents, authorizations, orders and approvals
and making such filings and registrations.

5.10 AFFILIATE LETTERS. Each of the Merging Companies, the
Surviving Companies and NSCB shall use their best efforts to obtain as promptly
as practicable after the date hereof a signed representation letter as to
certain restrictions on resale substantially in the form of Exhibit D hereto
from each of their respective executive officers and directors who may
reasonably be deemed an "affiliate" within the meaning of such term as used in
Rule 145 under the Securities Act, and shall use best efforts to obtain a
signed representation letter substantially in the form of Exhibit D from any
person who becomes an executive officer or director or any shareholder who
becomes such an "affiliate" after the date hereof as promptly as practicable
after such person achieves such status.

5.11 MATERIAL FACTS. None of the information supplied by the
Surviving Companies or NSCB or their respective subsidiaries for inclusion in
(i) the Registration Statement, will at any time the Registration Statement is
filed with the SEC and at the time it becomes effective

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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; (ii) the joint proxy statement,
will at the date mailed to the shareholders of each of the Surviving Companies
and SEC and at the time of such meetings of shareholders, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading; and (iii) any
other documents to be filed with the SEC, the Federal Reserve or any other
regulatory agency or for any State Approvals in connection with this Agreement
and the transactions contemplated hereby will, at the time of filing, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.

5.12 NOTIFICATION. Each of the Surviving Companies and NSCB shall
notify each of the other parties to this Agreement promptly after any of the
aforesaid receives notice that any of their respective shareholders have
exercised dissenting shareholders' rights under the BCA or DGCL.

5.13 DUE DILIGENCE.

(a) Due Diligence. Promptly following execution of this
Agreement, each of the parties hereto will conduct or continue its due
diligence investigation and review of the books, records and facilities of each
of the other parties hereto and their respective subsidiaries and will complete
such due diligence investigation prior to the Effective Date and in any event
not later than thirty (30) days following the date of this Agreement (such 30th
day following the date of this Agreement or such earlier date upon which due
diligence investigations are completed is referred to herein as the "Review
Date"). The parties agree to, and agree to cause their respective subsidiaries
to, provide access to information for purposes of such due diligence
investigations in accordance with Section 5.13(b) hereof. At the conclusion of
such due diligence investigations, each party shall notify the other parties of
any and all matters then known to such party which such party shall in good
faith determine (i) to be inconsistent in any material and adverse respect with
any of the representations and warranties of NSCB, the Merging Companies or any
Surviving Company contained in this Agreement, (ii) to be of such significance
as to materially and adversely affect the financial condition or the results of
operations of NSCB or the Surviving Companies on a consolidated basis with
their respective subsidiaries or (iii) to deviate materially and adversely from
financial statements for NSCB or any Surviving Company for the year ended
December 31, 1995. Any party shall thereafter have the right to terminate this
Agreement subject to and only in accordance with the provisions set forth in
Section 7.

(b) Continuing Access to Information. In furtherance and
not in limitation of the terms and provisions of Section 5.13(a) hereof, from
the date hereof through the Effective Date, each party shall permit each other
party hereto and its authorized representatives full access upon reasonable
notice and during regular business hours to such party's properties and

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those of its subsidiaries. The party shall make its and its subsidiaries'
directors, management and other employees and agents and authorized
representatives available to confer with any party hereto and its authorized
representatives at reasonable times and upon reasonable request, and each party
shall, and shall cause its subsidiaries to, disclose and make available to any
party hereto, and shall use its best efforts to cause its agents and authorized
representatives to disclose and make available to any party hereto, all books,
papers and records relating to the assets, properties, operations, obligations
and liabilities of such party and its subsidiaries including, without
limitation, bank examination reports (as permitted by law); tax returns,
leases, contracts, documents, financial statements, minute books, by-laws,
filings with and communications with regulatory authorities and Benefit Plans.

5.14 CONVERSION OF PREFERRED STOCK. As of the Effective Date, the
issued and outstanding capital stock of each of the Surviving Companies shall
consist only of common stock, the conversion of all of the issued and
outstanding preferred stock of the Surviving Companies to common stock to be
completed on or prior to the Effective Date. Schedule 5.14 sets forth the
following information with respect to the preferred stock of each of the
Surviving Companies: (i) number of shares of preferred stock issued and
outstanding as of the date of this Agreement; and (ii) number of shares of
common stock of the Surviving Companies common stock to be issued in the
conversion of such preferred stock.

6. CONDITIONS TO CLOSING

The respective obligations of each party to consummate the
transactions contemplated by this Agreement shall be subject to the fulfillment
at or prior to Closing of each of the following conditions (except to the
extent any such condition is waived by the applicable party or parties if
legally permissible to do so):

6.1 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 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 which
prohibits, materially restricts or makes illegal consummation of the Merger.

6.2 SHAREHOLDER APPROVALS. The transactions to be contemplated
pursuant to the terms of this Agreement shall be approved by at least
two-thirds of the stockholders of each of HB, LB, and NSCB; and by fifty-one
percent (51%) of the stockholders of LFB and Crabtree.

6.3 FAIRNESS OPINION. On or prior to the date of this Agreement,
each of the Surviving Companies and NSCB shall have received an opinion from
Howe Barnes Investments, Inc. ("Howe Barnes"), that the Exchange Ratio
applicable to the shares of its common stock is fair to its respective
shareholders from a financial point of view, which opinion shall not have been
withdrawn or materially modified prior to the Effective Date. Furthermore,
each of the

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Surviving Companies and NSCB shall receive as of the date of mailing of the
joint proxy statement/prospectus and the Effective Date, a written opinion from
Howe Barnes, dated as of such dates, to the effect that the previously issued
fairness opinion has not been changed, modified or amended in any material
respect.

6.4 EFFECTIVENESS OF FORM S-4. Notwithstanding any other
provision of this Agreement, the obligations of each party to consummate the
Reorganization are subject to the condition that the Registration Statement
have been declared effective under the Securities Act and no stop orders shall
be in effect and no proceedings for such purpose shall be pending or have been
initiated or threatened by the SEC. NSCB shall have received all state
securities or "blue sky" permits and other authorizations necessary to issue
the RC Shares in exchange for the LFB, HB, LB and Crabtree Common Stock
pursuant to the Reorganization.

6.5 REGULATORY APPROVALS. All necessary state and federal
regulatory approvals as set forth in Section 3.4 shall have been obtained and
remain in full force and effect and all statutory waiting periods in respect
thereof shall have expired.

6.6 TAX OPINION. The parties shall have received an opinion of
Blackman Kallick Bartelstein, LLP, Certified Public Accountants, in a form
reasonably acceptable to the parties, dated as of the Effective Date,
substantially to the effect that, on the basis of the facts, representations
and assumptions set forth in such opinion which are consistent with the facts
existing as of the Effective Date:

(a) that the Merger will constitute a tax free
reorganization under Section 368(a)(1)(A) of the Code;

(b) no gain or loss will be recognized by any party to
the Agreement as a result of the Merger;

(c) no gain or loss will be recognized by any holders of
the Shares who exchange their Shares solely for RC Shares (except with respect
to cash received in lieu of a fractional interest);

(d) the tax basis of the RC Shares received by holders
who exchange all of their Shares solely for RC Shares received in the
Reorganization will be the same as the tax basis of the Shares surrendered in
exchange therefor (reduced by any amount allocable to a fractional share
interest for which cash is received); and

(e) the holding period of the RC Shares received by the
holders of the Shares in the Reorganization will include the period during
which the RC Shares surrendered in exchange therefor were held.

6.7 POOLING OF INTEREST. The parties to the transaction shall
have received opinions of (i) KPMG Peat Marwick, LLP, in form and substance
reasonably satisfactory to the parties,

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dated as of the Effective Date, substantially to the effect that, on the basis
of facts, representations and assumptions set forth in such opinion which are
consistent with the facts existing as of the Effective Date, that the proposed
transaction will qualify for "pooling of interest" accounting treatment and
(ii) Arthur Andersen, LLP, in form and substance reasonably satisfactory to the
parties, dated as of the Effective Date, substantially to the effect that on
the basis of facts, representations and assumptions set forth in such opinion
which are consistent with the facts existing as of the Effective Date, that the
1996 corporate restructuring transactions relating to Crabtree and its former
and current subsidiaries qualify for "pooling of interest" accounting
treatment.

6.8 FIRST PREMIUM WARRANTS. At or prior to the Effective Date,
Crabtree will cause the terms of the existing and outstanding First Premium
Warrants to have been amended so as to provide the holders thereof the right to
acquire an aggregate of 378,376 shares of Crabtree Common Stock in lieu of
shares of First Premium on a comparable basis to such holders' respective First
Premium Warrants. Schedule 1.8 sets forth the following information with
respect to the First Premium Warrants: (i) the number of shares of First
Premium stock subject to Warrants outstanding as of the date hereof and (ii)
the number of shares of Crabtree Common Stock to become subject to such
Warrants and the number of RC Shares to be subject thereto (assuming no
exercise of any such Warrants prior to the Effective Date) as a result of
conversion of such Warrants pursuant to the Reorganization.

6.9 CONVERSION OF FIRST PREMIUM AND CREDIT LIFE OPTION PLANS. At
or prior to the Effective Date, and in any event prior to the exercise of any
options outstanding thereunder, Crabtree will have caused all existing Option
Plans at First Premium and Credit Life to have been amended so as to provide
for the conversion of the Credit Life options into the right to acquire shares
of First Premium effective upon consummation of the merger contemplated by
Section 6.11 hereof, and the conversion of all options to acquire First Premium
Common Stock outstanding immediately prior to the Effective Date into the right
to acquire RC Shares such that, effective upon the Effective Date, any of the
options granted thereunder shall, by virtue of the Reorganization and without
any further action on the part of the holders thereof, be converted into the
right to purchase up to an aggregate of 133,963 RC Shares on comparable terms
applicable to the currently outstanding options to purchase First Premium and
Credit Life shares, in each case as appropriately adjusted to reflect such
conversion. Schedule 1.9 sets forth the following information with respect to
the Option Plans at First Premium and Credit Life: (i) the number of Options
issued and outstanding as of the Effective Date; and (ii) the number of RC
Shares to be subject to such Options upon the Effective Date.

6.10 NO MATERIAL ADVERSE CHANGE. Except as disclosed or otherwise
contemplated herein, there shall have occurred no adverse change or changes
(whether or not covered by insurance) during the period from December 31, 1995
to the Effective Date in the assets, liabilities, properties, financial
condition, results of operations or business prospects of any one or more of
the other parties and their respective subsidiaries, taken as a whole, which
would be materially adverse to the results of operations, financial condition
or business prospects of the Resulting Company on a combined basis.

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6.11 CONSUMMATION OF FIRST PREMIUM/CREDIT LIFE MERGER. Prior to
the Effective Date, Crabtree shall have caused Credit Life to have been duly
merged with and into First Premium in accordance with the applicable provisions
of state law.

7. TERMINATION

7.1 TERMINATION. This Agreement may be terminated at any date
prior to the Effective Date, whether before or after approval by the
shareholders of the Merging Companies, the Surviving Companies or NSCB:

(a) by mutual written consent of all the parties to this
Agreement;

(b) by any parties to this Agreement if (i) the Merger
has not been effected on or prior to the close of business on December 31, 1996
(the "Final Merger Date"); provided, however, that the right to terminate this
Agreement pursuant to this clause shall not be available to any party whose
failure to fulfill any obligation of this Agreement has been the cause of, or
resulted in, the failure of the Merger to have been effected on or prior to
such date, or (ii) any court of competent jurisdiction shall have issued an
order, decree or ruling or taken any other action permanently enjoining,
restraining or otherwise prohibiting the transactions contemplated by this
Agreement and such order, decree, ruling or other action shall have become
final and non-appealable;

(c) by any party to this Agreement in the event that such
party's due diligence investigations and review of any of the other parties as
provided for in Section 5.13(a) of this Agreement discloses matters which such
party in good faith believes to (i) be inconsistent in any material respect
with any of the representations and warranties of any party contained in this
Agreement or (ii) be of such significance as to materially and adversely affect
the financial condition or the business prospects of any party and its
respective subsidiaries on a consolidated basis, or (iii) deviate materially
and adversely from the applicable financial statements for the year ended
December 31, 1995, by giving written notice of termination to the other parties
hereto within seven days after the Review Date. Notwithstanding the foregoing,
no party shall have the right to terminate pursuant to this Section 7.1(c) as a
result of any changes in general economic conditions or matters which affect
financial institutions or premium finance businesses generally; or

(d) by any party to this Agreement if any condition in
Section 6 cannot be satisfied by the Final Merger Date.

7.2 EFFECT OF TERMINATION. If this Agreement is terminated
pursuant to Section 7.1, this Agreement shall forthwith become void and there
shall be no liability or obligation on the part of any party to this Agreement
or their respective directors and officers under this Agreement, except for the
continuing obligation of each party to this Agreement pursuant to Section 8.6
hereof.

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8. GENERAL PROVISIONS

8.1 WAIVER OF TERMS. Any of the terms or conditions of this
Agreement may be waived at any time by the party or parties entitled to the
benefit thereof (to the extent legally permissible) but only by a written
instrument signed by the party or parties waiving such terms or conditions.
Notwithstanding the foregoing, any waiver given after the Shareholders'
Meetings shall have no effect on the Exchange Ratios as approved at such
Shareholders' Meetings.

8.2 AMENDMENT OF AGREEMENT. This Agreement may be amended,
supplemented or interpreted at any time only by written instrument duly
executed by each party hereto. Notwithstanding the foregoing, any amendment
dated subsequent to the Shareholders' Meetings shall have no effect on the
Exchange Ratios as approved at such Shareholders' Meeting.

8.3 CONTENTS OF AGREEMENT; BINDING NATURE. This Agreement and the
other agreements and documents to be delivered by the parties as provided
herein set forth the entire understanding of the parties with respect to the
subject matter hereof. Any previous agreements or understandings between the
parties regarding such subject matter are merged into and superseded by this
Agreement. All representations, warranties, covenants, terms and conditions of
this Agreement shall be binding upon and inure to the benefit of and be
enforceable by the successors and assigns of the parties hereto.

8.4 NOTICES. All notices, requests, demands and other
communications required or permitted to be given hereunder shall be by
hand-delivery, certified or registered mail, return receipt requested;
telecopiers, or air courier to the parties set forth below. Such notices shall
be deemed given: at the time personally delivered, if delivered by hand or by
courier; at the time received if sent certified or registered mail; and when
receipt acknowledged by receiving telecopy equipment if telecopied.

If to North Shore Community 1145 Wilmette
Bancorp, Inc. Wilmette, Illinois 60091
Attn: John Close
Telecopier: (847) 853-0159

If to Lake Forest Bancorp, Inc.: 727 North Bank Lane
Post Office Box 5010
Lake Forest, Illinois 60045
Attn: Edward J. Wehmer
Telecopier: (847) 234-4717

If to Hinsdale Bancorp, Inc.: 25 East First Street
Hinsdale, Illinois 60521
Attn: Dennis Jones
Telecopier: (708) 655-8008

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If to Libertyville Bancorp, Inc.: 507 North Milwaukee Avenue
Libertyville, Illinois 60048
Attn: Bert Carstens
Telecopier: (847) 367-8444

If to Crabtree Capital Corporation: 475 North Martingale Road
Suite 440
Schaumburg, Illinois 60173
Attn: David L. Steele
Telecopier: (847) 517-8034

8.5 COMMISSIONS AND FINDER'S FEES. All parties hereto represent
and warrant to each other that none of them has retained or used the services
of any individual, firm or corporation in such manner as to entitle such
individual, firm or corporation to any compensation for brokers' or finders'
fees with respect to the transactions contemplated hereby for which the other
may be liable.

8.6 EXPENSES. NSCB, LFB, HB, LB and Crabtree each agrees to bear
an equal portion of the total shared fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby, including, but
not limited to, legal fees and disbursements, investment banking and financial
advisory fees relating to obtaining the fairness opinions, fees relating to
obtaining the tax opinion and "pooling" opinion from the respective accounting
firms, SEC registration fees and the costs of printing and mailing proxy
statements and conducting special shareholder meetings, and the costs of
preparing and filing requisite regulatory applications. The agreement set
forth in this Section 8.6 shall survive the Effective Date and in the event
this Agreement is terminated prior to consummation of the Reorganization by any
party hereto, this Section 8.6 shall survive such termination.

8.7 SEVERABILITY. In the event that any one or more of the
provisions contained in this Agreement shall be invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions of this Agreement shall not be in any way impaired.

8.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

8.9 HEADINGS. The headings of the Sections and the subsections of
this Agreement are inserted for convenience of reference only and shall not
constitute a part hereof.

8.10 GOVERNING LAW; JURISDICTION. This Agreement shall be
governed, construed and enforced in accordance with the internal laws of the
State of Illinois, excluding any choice of law rules that may direct the
application of the laws of another jurisdiction. The parties hereby covenant
and agree that any and all actions arising out of or related to this Agreement
shall be

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brought and maintained in the federal and state courts sitting in Cook County,
Illinois. Each party hereto hereby irrevocably consents and submits to the
jurisdiction of and the service of process from such courts for any and all
such actions.

8.11 INSTRUMENTS OF FURTHER ASSURANCE. Each of the parties hereto
agrees, upon the request of any of the other parties hereto, from time to time
to execute and deliver to such other party or parties all such instruments and
documents of further assurance or otherwise as shall be reasonable under the
circumstances, and to do any and all such acts and things as may reasonably be
required to carry out the obligations of such requested party hereunder.

8.12 PUBLICITY. No notices to third parties or other publicity,
including press releases, concerning any of the transactions provided for
herein shall be made by any party hereto unless planned, coordinated and agreed
to jointly among the parties hereto, except to the extent otherwise required by
law.

8.13 NO THIRD PARTY BENEFICIARIES. Nothing in this Agreement is
intended nor shall it be construed to give any person, firm, corporation or
other entity, other than the parties hereto and their respective successors and
assigns, any right, remedy or claim under or in respect of this Agreement or
any provisions hereof.

IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of the day and year first above written.

NORTH SHORE COMMUNITY LAKE FOREST BANCORP II
BANCORP, INC.

By: /s/ JOHN W. CLOSE By: /s/ DAVID A. DYKSTRA
-------------------------- --------------------------
Its: President Its: Executive Vice President
-------------------------- --------------------------

LAKE FOREST BANCORP, INC. HINSDALE BANCORP II

By: /s/ EDWARD J. WEHMER By: /s/ DAVID A. DYKSTRA
-------------------------- --------------------------
Its: President Its: Executive Vice President
-------------------------- --------------------------

HINSDALE BANCORP, INC. LIBERTYVILLE BANCORP II

By: /s/ DENNIS J. JONES By: /s/ DAVID A. DYKSTRA
-------------------------- --------------------------
Its: Chairman Its: Executive Vice President
-------------------------- --------------------------

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LIBERTYVILLE BANCORP, INC. CRABTREE CAPITAL CORPORATION II

By: /s/ J. ALBERT CARSTENS By: /s/ DAVID A. DYKSTRA
-------------------------- --------------------------
Its: President Its: Executive Vice President
-------------------------- --------------------------

CRABTREE CAPITAL CORPORATION

By: /s/ HOWARD D. ADAMS
--------------------------
Its: Chairman
--------------------------

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SCHEDULE 1.4

PERSONS TO BE DIRECTORS AND OFFICERS
OF RESULTING COMPANY

OFFICERS

Howard D. Adams, Chairman and Chief Executive Officer
Edward J. Wehmer, President
David A. Dykstra, Chief Financial Officer and Treasurer
Lloyd Bowden, Executive Vice President
Robert Key, Executive Vice President

DIRECTORS

Alan A. Adams
Howard D. Adams
Peter Crist
Maurice F. Dunne, Jr.
Eugene Hotchkiss
James Knollenberg
John S. Lillard
James Mahoney
James B. McCarthy
Marguerite Savard McKenna
Tull Monsees
Albin Moschner
Hollis Rademacher
J. Christopher Reyes
John Schaper
John J. Schornack
Jane Stein
Kathy Sylvester
Lemuel H. Tate
Edward J. Wehmer
Larry Wright

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SCHEDULE 1.8

SCHEDULE OF WARRANTS

First
LFB HB LB Premium NSCB
--- -- -- ------- ----

Number of Shares Subject to -0- 10,000 20,760 6,493 5,000
Outstanding Warrants
Number of Resulting Company Shares to
be subject to such Warrants upon the
Effective Date(3)
N/A (1) (2) 447,740 25,809

- -----------

(1) The Warrants outstanding at HB will continue to be outstanding at HB
after consummation of the Reorganization and will continue to
represent the right to acquire an aggregate of 10,000 shares of HB
Common Stock.

(2) The Warrants outstanding at LB will continue to be outstanding at LB
after consummation of the Reorganization and will continue to
represent the right to acquire an aggregate of 20,760 shares of LB
Common Stock.

(3) Assuming no prior exercise thereof.

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SCHEDULE 1.9

SCHEDULE OF RIGHTS/OPTIONS

FIRST CREDIT
NSCB LFB HB LB PREMIUM CRABTREE LIFE
---- --- -- -- ------- -------- ----

Number of Rights/Options
Outstanding 64,076 36,502 31,455 22,550 1,783 43,725 74.7
Aggregate Number of RC
Shares to be subject to
such Rights/Options upon
the Effective Date(1) 330,748 353,097 189,799 90,782 122,951 51,741 11,012

- ------------

(1) Assumes no prior exercise of any such rights or options.

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SCHEDULE 3.3

CAPITALIZATION OF NSCB AND THE MERGING COMPANIES

NSCB LFBII HB II LB II Crabtree
---- ----- ----- ----- --------
II
--

(i) Number of Authorized Common Shares and Preferred 400,000 200,000 350,000 350,000 2,000,000
Shares -0- -0- -0- -0-
(ii) Number of Common Shares and Preferred Shares 253,809 163,360 207,137 229,929 1,025,265
Issued and Outstanding -0- -0- -0- -0- -0-

(iii) Number of Shares Subject to Common Stock Rights
Outstanding 20,000 (1) -0- -0- -0- -0-

(iv) Number of Shares Subject to Common Stock
Warrants Outstanding 5,000 (2) -0- -0- -0- -0-
(v) Number of Shares Subject to Outstanding Options
44,076 (3) -0- -0- -0- -0-

- ------------
(1) Such shares will be adjusted to reflect the contemplated stock split
of NSCB as of the Effective Date, resulting in 103,236 RC Shares
being subject to such Rights upon consummation of the Reorganization
assuming no prior exercise thereof.

(2) Such shares will be adjusted to reflect the contemplated stock split
of NSCB as of the Effective Date, resulting in 25,809 RC Shares
being subject to such Warrants upon consummation of the
Reorganization assuming no prior exercise thereof.

(3) Such shares will be adjusted to reflect the contemplated stock split
of NSCB as of the Effective Date, resulting in 227,512 RC Shares
being subject to such Options upon consummation of the
Reorganization assuming no prior exercise thereof.

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SCHEDULE 4.3

CAPITALIZATION OF THE SURVIVING COMPANIES

LFB HB LB CRABTREE
------- ------ ------ --------

(i) Number of Authorized Common Shares and Preferred 200,000 350,000 350,000 2,000,000
Shares 7,500 -0- 25,000 -0-
(ii) Number of Common Shares and Preferred Shares 160,810 207,137 205,929 1,025,265
Issued and Outstanding 1,700 -0- 24,000 -0-

(iii) Number of Common Stock Rights Outstanding -0- -0- -0- -0-

(iv) Common Stock Warrants Outstanding -0- 10,000 5,000 -0- (1)
(v) Number of Shares Subject to Outstanding Options 36,502 31,455 22,550 43,725 (2)

- ---------------

(1) Does not include Warrants outstanding to purchase shares of common
stock of First Premium, a wholly-owned subsidiary of Crabtree, which
are to be converted into the right to acquire an aggregate of
378,376 shares of Crabtree at or prior to the Effective Date. Such
Warrants (assuming no prior exercise thereof) will be further
converted, in accordance with the terms of the Reorganization, into
the right to acquire 447,740 RC Shares on comparable terms
appropriately adjusted to reflect such conversions. See Sections
1.8 and 6.8 of the Agreement.

(2) In addition, there are currently outstanding options to purchase
1,783 shares and 74.7 shares of common stock of First Premium and
Credit Life, respectively, both wholly-owned subsidiaries of
Crabtree, which options are to be converted in accordance with the
terms of the Reorganization into options representing the right to
purchase RC Shares.

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SCHEDULE 5.14

SCHEDULE OF PREFERRED STOCK

LFB LB
--- --

Number of Preferred Shares Authorized 7,500 25,000
Number of Preferred Shares Issued and
Outstanding 1,700 24,000

Number of Surviving Company Shares to
be Issued upon Conversion of the
Preferred Shares prior to the Effective Date 2,550 24,000

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EXHIBIT A

PLAN OF MERGER

by and among

NORTH SHORE COMMUNITY BANCORP, INC.

and

Dated as of this 28th day of May, 1996

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TABLE OF CONTENTS

Section Page
- ------- ----

1. REORGANIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
1.1 The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
1.2 Effective Time of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
1.3 Effects of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-6
1.4 Articles of Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
1.5 Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
1.6 Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
1.7 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
1.8 Effect of the Merger on Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-7
1.9 Effect of the Merger on Capital Stock of the Merging Companies . . . . . . . . . . . . . . . . . A-9
1.10 Dissenting Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9
1.11 Necessary Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-9

2. EXCHANGE OF SHARE CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-10
2.1 Exchange of Share Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-10

3. CONDITIONS TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
3.1 Conditions to the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11

4. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
4.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11

5. GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
5.1 Waiver of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
5.2 Amendment of Plan of Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
5.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-11
5.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
5.5 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12
5.6 Governing Law; Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-12

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LIST OF EXHIBITS

Exhibit A Articles of Incorporation of Resulting Company [See Exhibit B
to Reorganization Agreement)

Exhibit B By-laws of Resulting Company [See Exhibit C to Reorganization
Agreement]

Exhibit C Officers and Directors of Resulting Company [See Schedule 1.4
to Reorganization Agreement)

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PLAN OF MERGER

THIS PLAN OF MERGER (the "Plan of Merger") is made as of this 28th
day of May, 1996 by and among NORTH SHORE COMMUNITY BANCORP, INC., an
Illinois corporation ("NSCB"), LAKE FOREST BANCORP II, an Illinois corporation
("LFBII"), HINSDALE BANCORP II, an Illinois corporation ("HBII"), LIBERTYVILLE
BANCORP II, an Illinois corporation ("LBII"), CRABTREE CAPITAL CORPORATION II,
an Illinois corporation ("Crabtree II"), each a wholly owned subsidiary of
NSCB, and each of LAKE FOREST BANCORP, INC., a Delaware corporation ("LFB"),
HINSDALE BANCORP, INC., an Illinois corporation ("HB"), LIBERTYVILLE BANCORP,
INC., an Illinois corporation ("LB"), and CRABTREE CAPITAL CORPORATION, a
Delaware corporation ("Crabtree").

W I T N E S E T H:

WHEREAS, NSCB is an Illinois corporation with authorized capital
consisting of 400,000 shares of common stock, no par value, of which 253,809
shares are issued and outstanding on the date hereof;

WHEREAS, LFBII is an Illinois corporation with authorized capital
consisting of 200,000 shares of common stock, no par value, of which 163,360
shares are issued and outstanding on the date hereof;

WHEREAS, HBII is an Illinois corporation with authorized capital
consisting of 350,000 shares of common stock, no par value, of which 207,137
shares are issued and outstanding on the date hereof;

WHEREAS, LBII is an Illinois corporation with authorized capital
consisting of 350,000 shares of common stock, no par value, of which 229,929
shares are issued and outstanding on the date hereof;

WHEREAS, Crabtree II is an Illinois corporation with authorized
capital consisting of 2,000,000 shares of common stock, no par value, of which
1,025,265 shares are issued and outstanding on the date hereof;

WHEREAS, LFB is a Delaware corporation with authorized capital
consisting of (i) 200,000 shares of common stock, $1.00 par value per share, of
which 160,810 shares are issued and outstanding on the date hereof; and (ii)
7,500 shares of preferred stock, $2.00 par value per share, of which no shares
are issued and outstanding on the date hereof;

WHEREAS, HB is an Illinois corporation with authorized capital
consisting of 350,000 shares of common stock, no par value, of which 207,137
shares are issued and outstanding on the date hereof;

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WHEREAS, LB is an Illinois corporation with authorized capital
consisting of (i) 350,000 shares of common stock, no par value, of which
205,929 shares are issued and outstanding on the date hereof; and (ii) 25,000
shares of preferred stock, no par value, of which no shares are issued and
outstanding on the date hereof;

WHEREAS, Crabtree is a Delaware corporation with authorized capital
consisting of 2,000,000 shares of common stock, $1.00 par value per share, of
which 1,025,265 shares are issued and outstanding on the date hereof;

WHEREAS, concurrently with the execution and delivery of this Plan of
Merger, NSCB, the Surviving Companies and the Merging Companies have entered
into an Agreement and Plan of Reorganization (the "Agreement" and, together
with this Plan of Merger, the "Merger Agreements") that contemplates the merger
of (i) LFBII with and into LFB, (ii) HBII with and into HB, (iii) LBII with and
into LB and (iv) Crabtree II with and into Crabtree, upon the terms and
conditions provided for in this Plan of Merger and the Agreement and pursuant
to the Illinois Business Corporation Act (the "BCA") and the Delaware General
Corporation Law (the "DGCL");

WHEREAS, as a result of the Reorganization, each of the issued and
outstanding shares of the Surviving Companies shall be converted into the right
to receive shares of common stock of the Resulting Company and each of the
issued and outstanding shares of the Merging Companies shall be converted into
shares of the applicable Surviving Company, such that NSCB will own one hundred
percent (100%) of the capital stock of LFB, HB, LB and Crabtree as a result of
the Reorganization (NSCB in its capacity as the resulting company is referred
to herein as the "Resulting Company"); and

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NOW THEREFORE, in consideration of the foregoing premises and the
mutual promises, covenants and agreements hereinafter set forth, the parties
hereto agree as follows:

1. REORGANIZATION

1.1 THE MERGER. Subject to the terms and conditions of the Merger
Agreements, LFB II will merge with and into LFB, HBII will merge with and into
HB, LBII will merge with and into LB, and Crabtree II will merge with and into
Crabtree, with each of LFB, HB, LB and Crabtree as the surviving corporations,
in accordance with and with the effect of the BCA and the DGCL (the "Merger"),
and the issued and outstanding shares of the Surviving Companies shall be
converted into shares of the Resulting Company as provided for in Section 1.8
of this Plan of Merger and the issued and outstanding shares of the Merging
Companies shall be converted into shares of the Surviving Companies as provided
for in Section 1.9 of this Plan of Merger, and the separate corporate existence
of each of the Merging Companies shall cease.

1.2 EFFECTIVE TIME OF THE MERGER. Subject to the provisions of
the Merger Agreements, (a) articles of merger (the "Articles of Merger") shall
be duly prepared and executed by the Merging Companies and Surviving Companies
and thereafter delivered to the Secretary of State of the State of Illinois for
filing, as provided in the IBCA, on the Closing Date (as defined in the
Agreement) and (b) a certificate of merger (the "Certificate of Merger") shall
be duly prepared and executed by the Merging Companies and the Surviving
Companies and thereafter delivered to the Secretary of State of the State of
Delaware for filing, as provided in the DGCL, on the Closing Date. The Merger
shall become effective upon the filing of the Articles of Merger with the
Secretary of State of the State of Illinois and the Certificate of Merger with
the Secretary of State of the State of Delaware (the "Effective Time").

1.3 EFFECTS OF THE MERGER. (a) At the Effective Time, (i) the
separate existence of the Merging Corporations shall cease and the Merging
Companies shall be merged with and into the Surviving Companies as provided in
Section 5/11.35 of the IBCA and Section 252 of the DGCL (the Merging Companies
and the Surviving Companies are sometimes referred to herein as the
"Constituent Corporations").

(b) At and after the Effective Time, the Surviving Companies shall
possess all the rights, privileges, powers and franchises of a public as well
as of a private nature, and be subject to all the restrictions, disabilities
and duties of each of the Constituent Corporations; and all singular rights,
privileges, powers and franchises of each of the Constituent Corporations; and
all property, real, personal and mixed and all debts due to any of the
Constituent Corporations on whatever account, as well as for stock
subscriptions and all other things in action or belonging to each of the
Constituent Corporations, shall be vested in the Surviving Companies; and all
property, rights, privileges, powers and franchises, and all and every other
interest shall be thereafter as effectually the property of the respective
Surviving Company as they were of the Constituent Corporations, and the title
to any real estate vested by deed or otherwise, in either of the Constituent
Corporations, shall not revert or be in any way impaired; but all rights of

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creditors and all liens upon any property of either of the Constituent
Corporations shall be preserved unimpaired, and all debts, liabilities and
duties of the Constituent Corporations shall thenceforth attach to the
Surviving Companies, and may be enforced against it to the same extent as if
said debts and liabilities had been incurred by it. Any action or proceeding,
whether civil, criminal or administrative, pending by or against either
Constituent Corporation shall be prosecuted as if the Merger had not taken
place, and the respective Surviving Company may be substituted as a party in
such action or proceeding in place of any Constituent Corporation.

1.4 ARTICLES OF INCORPORATION. As of the Effective Date, the
Articles of Incorporation of the Resulting Company shall be amended and
restated to read in their entirety as set forth in Exhibit A, and shall
thereafter remain in full force and effect until amended in accordance with
applicable law. The Articles of Incorporation, or Certificates of
Incorporation, as the case may be, of the Surviving Companies, as in effect on
the Effective Date, shall be the Articles of Incorporation, or Certificates of
Incorporation, as the case may be, of the Surviving Companies, as the surviving
entities, following the Effective Date.

1.5 BYLAWS. The Bylaws of the Resulting Company shall be amended
and restated to read in their entirety as set forth in Exhibit B, and shall
remain in full force and effect until thereafter amended in accordance with
applicable law. The Bylaws of the Surviving Companies, as in effect on the
Effective Date shall be the Bylaws of the Surviving Companies, as the surviving
entities, following the Effective Date.

1.6 DIRECTORS AND OFFICERS. As of the Effective Date, the
officers and directors of the Surviving Companies immediately prior to the
Effective Date shall be the officers and directors of the Surviving Companies
until such time as their respective successors have been elected and qualified
and no change shall occur in the officers and directors of the Surviving
Companies as a result of the Reorganization. As of the Effective Date, the
officers and the directors of the Resulting Company shall be those persons set
forth on Exhibit C.

1.7 NAME. As of the Effective Date, the name of the Resulting
Company shall be "Wintrust Financial Corporation".

1.8 EFFECT OF THE MERGER ON CAPITAL STOCK.

(a) Common Stock. As of the Effective Date, by virtue of
the Merger, each validly issued and outstanding share of the capital stock of
NSCB and the Surviving Companies, other than Dissenting Shares (as that term is
defined in Section 1.10) (collectively, the "Shares") shall be converted,
adjusted or cancelled as follows:

(i) LFB. Except as provided in Section
1.8(a)(viii) below, each share of the common stock, $1.00 par value
per share, of LFB (the "LFB Common Stock") validly issued, fully paid
and nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 9.67334 shares (the "LFB

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Exchange Ratio") of the common stock, without par value, of the
Resulting Company ("RC Shares");

(ii) HB. Except as provided in Section
1.8(a)(viii) below, each share of the common stock, no par value per
share, of HB (the "HB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 6.03398 RC Shares (the
"HB Exchange Ratio");

(iii) LB. Except as provided in Section
1.8(a)(viii) below, each share of the common stock, no par value per
share, of LB (the "LB Common Stock") validly issued, fully paid and
nonassessable, outstanding immediately prior to the Effective Date
shall be converted into the right to receive 4.02578 RC Shares (the
"LB Exchange Ratio");

(iv) Crabtree. Except as provided in Section
1.8(a)(viii) below, each share of the common stock, par value $1.00
per share, of Crabtree (the "Crabtree Common Stock") validly issued,
fully paid and nonassessable, outstanding immediately prior to the
Effective Date shall be converted into the right to receive 1.18332 RC
Shares (the "Crabtree Exchange Ratio").

(The LFB Exchange Ratio, the HB Exchange Ratio, the
LB Exchange Ratio and the Crabtree Exchange Ratio are hereinafter
collectively referred to as the "Exchange Ratios").

(v) Adjustment of NSCB Stock. Except as provided
in Section 1.8(a)(viii) below, each share of common stock, no par
value, of NSCB validly issued, fully paid and nonassessable,
outstanding immediately prior to the Effective Date shall be adjusted
from and after the Effective Date so as to represent 5.16180 RC Shares
(the "NSCB Exchange Ratio").

(vi) Share Certificates. The certificate(s) which
formerly represented the Shares shall, from and after the Effective
Date, represent the right to receive the number of shares of the
Resulting Company set forth above in Section (a) through (e) of this
Section 1.8 until exchanged as provided for in Section 2.2.

(vii) Fractional Shares. No certificate for
fractional RC Shares will be issued by the Resulting Company in
connection with the exchange contemplated by the Merger, but in lieu
thereof, any holder of Shares shall, upon surrender of the
certificates(s) representing such Shares, be paid cash, without
interest, by the Resulting Company for such fractional shares on the
basis of the Exchange Ratio applicable to such Shares.

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(b) Preferred Stock. Any shares of preferred stock of
any of the Surviving Companies issued and outstanding as of the Effective Date
shall be cancelled.

1.9 EFFECT OF THE MERGER ON CAPITAL STOCK OF THE MERGING
COMPANIES. Each validly issued and outstanding share of common stock of each
of the Merging Companies shall be converted into one share of the applicable
Surviving Company as of the Effective Date as follows:

Applicable
Merging Surviving
Company Company
------- -------

LFB II LFB
HB II HB
LB II LB
Crabtree II Crabtree

1.11 NECESSARY ACTIONS. (a) In the event that this Plan of Merger
shall have been fully approved and adopted upon behalf of NSCB and the Merging
Companies in accordance with the provisions of the BCA and upon behalf of the
Surviving Companies in accordance with the provisions of the BCA and the DGCL,
as the case may be, the said parties agree that they will cause to be executed
and filed and recorded any document or documents prescribed by the laws of the
State of Illinois or the State of Delaware, as the case may be, and that they
will cause to be performed all necessary acts within the State of Illinois or
the State of Delaware, as the case may be, and elsewhere to effectuate the
Reorganization herein provided for.

(b) The Board of Directors and the proper officers of NSCB, the
Merging Companies and of the Surviving Companies are hereby authorized,
empowered, and directed to do any and all acts and things, and to make,
execute, deliver, file, and record any and all instruments, papers, and
documents which shall be or become necessary, proper, or convenient to carry
out

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or put into effect any of the provisions of this Plan of Merger or of the
Reorganization herein provided for.

2. EXCHANGE OF SHARE CERTIFICATES

2.1 EXCHANGE OF SHARE CERTIFICATES. As soon as practicable after
the Effective Date, the Resulting Company shall mail to each holder of record
of Shares a letter of transmittal and instructions for use in the surrender of
the Shares in exchange for certificates representing RC Shares and any cash in
lieu of fractional shares into which the Shares shall have been converted or
adjusted pursuant to the terms of this Plan of Merger. Upon proper surrender
of certificates for exchange and cancellation to the Resulting Company, the
holder of such Shares shall be entitled to receive in exchange therefor, as
applicable (i) a certificate representing the number of shares of RC Shares to
which such holder of Shares may have become entitled pursuant to the provisions
of this Plan of Merger, and/or (ii) a check representing the amount of any cash
in lieu of fractional shares which such holder has the right to receive in
respect of the Shares surrendered pursuant to the provisions of this Section
2.1. No interest will be paid or accrued on any cash payable in lieu of
fractional shares or on any unpaid dividends and distributions payable to
holders of Shares.

No dividends or other distributions that are declared on or after the
Effective Date on RC Shares or otherwise payable to holders of record thereof
on or after the Effective Date will be paid until such persons surrender their
Shares, as provided for herein, and no cash payment in lieu of fractional
shares shall be paid to any such holder until the holder of such Shares shall
so surrender the Shares. In no event shall the person entitled to receive such
dividends or other distributions be entitled to receive interest on such
dividends or other distributions. If any cash or certificate representing
shares of RC Shares is to be paid to or issued in the name of a person other
than that in which the Shares surrendered in exchange therefor are registered,
it shall be a condition of such exchange that the Shares so surrendered shall
be properly endorsed and otherwise in proper form for transfer and that the
person requesting such exchange shall pay to the Resulting Company any transfer
or other taxes required by reason of the issuance of the certificates for such
shares of RC Shares in a name other than that of the registered holder of the
Shares surrendered, or shall establish to the satisfaction of the Resulting
Company that such tax has been paid or is not applicable.

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3. CONDITIONS TO CLOSING

3.1 CONDITIONS TO THE MERGER. Consummation of the Merger is
conditional upon the fulfillment or waiver of the conditions precedent set
forth in Section 6 of the Agreement.

4. TERMINATION

4.1 TERMINATION. This Plan of Merger may be terminated and the
Merger abandoned by mutual consent of all the parties to the Agreement at any
time prior to the Effective Date or otherwise in accordance with Section 7 of
the Agreement. If the Agreement is terminated in accordance with Section 7
thereof, then this Plan of Merger will terminate simultaneously and the Merger
will be abandoned without further action by the parties hereto.

5. GENERAL PROVISIONS

5.1 WAIVER OF TERMS. Subject to the next following sentence, any
of the terms or conditions of this Plan of Merger may be waived at any time by
the party or parties entitled to the benefit thereof (to the extent legally
permissible) but only by a written instrument signed by the party or parties
waiving such terms or conditions. Notwithstanding the foregoing, any waiver
given after the Shareholders' Meetings shall have no effect on the Exchange
Ratios as approved at such Shareholders' Meetings.

5.2 AMENDMENT OF PLAN OF MERGER. This Plan of Merger may be
amended, supplemented or interpreted at any time only by written instrument
duly executed by each party hereto. Notwithstanding the foregoing, any
amendment after the Shareholders' Meetings shall have no effect on the Exchange
Ratios as approved at such Shareholders' Meetings.

5.3 NOTICES. All notices, requests, demands and other
communications required or permitted to be given hereunder shall be by
hand-delivery, certified or registered mail, return receipt requested;
telecopier, or air courier to the parties set forth below. Such notices shall
be deemed given: at the time personally delivered, if delivered by hand or by
courier; at the time received if sent certified or registered mail; and when
receipt acknowledged by receiving telecopy equipment if telecopied.

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If to North Shore Community 1145 Wilmette
Bancorp, Inc. or any of the Wilmette, Illinois 60091
Merging Companies: Attn: John Close
Telecopier: (847) 853-0159

If to Lake Forest Bancorp, Inc.: 727 North Bank Lane
Post Office Box 5010
Lake Forest, Illinois 60045
Attn: Edward J. Wehmer
Telecopier: (847) 234-4717

If to Hinsdale Bancorp, Inc.: 25 East First Street
Hinsdale, Illinois 60521
Attn: Dennis Jones
Telecopier: (708) 655-8008

If to Libertyville Bancorp, Inc.: 507 North Milwaukee Avenue
Libertyville, Illinois 60048
Attn: Bert Carstens
Telecopier: (847) 367-8444

If to Crabtree Capital Corporation: 475 North Martingale Road
Suite 440
Schaumburg, Illinois 60173
Attn: David L. Steele
Telecopier: (847) 517-8034

5.4 SEVERABILITY. In the event that any one or more of the
provisions contained in this Plan of Merger shall be invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions of this Plan of Merger shall not be in any way impaired.

5.5 COUNTERPARTS. This Plan of Merger may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

5.6 GOVERNING LAW; JURISDICTION. This Plan of Merger shall be
governed, construed and enforced in accordance with the internal laws of the
State of Illinois, excluding any choice of law rules that may direct the
application of the laws of another jurisdiction. The parties hereby covenant
and agree that any and all actions arising out of or related to this Plan of
Merger shall be brought and maintained in the federal and state courts sitting
in Cook County, Illinois. Each party hereto hereby irrevocably consents and
submits to the jurisdiction of and the service of process from such courts for
any and all such actions.

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IN WITNESS WHEREOF, this Plan of Merger has been duly executed by each
of the constituent corporations parties hereto as of the day and year first
above written.

NORTH SHORE COMMUNITY LAKE FOREST BANCORP II
BANCORP, INC.

By: /s/ John W. Close By: /s/ David A. Dykstra
---------------------------- ---------------------------
Its: President Its: Executive Vice President
--------------------------- --------------------------

LAKE FOREST BANCORP, INC. HINSDALE BANCORP II

By: /s/ Edward J. Wehmer By: /s/ David A. Dykstra
---------------------------- ---------------------------
Its: President Its: Executive Vice President
--------------------------- --------------------------

HINSDALE BANCORP, INC. LIBERTYVILLE BANCORP II

By: /s/ Dennis J. Jones By: /s/ David A. Dykstra
---------------------------- ---------------------------
Its: President Its: Executive Vice President
--------------------------- --------------------------

LIBERTYVILLE BANCORP, INC. CRABTREE CAPITAL CORPORATION II

By: /s/ J. Albert Carstens By: /s/ David A. Dykstra
---------------------------- ---------------------------
Its: President Its: Executive Vice President
--------------------------- --------------------------

CRABTREE CAPITAL CORPORATION

By: /s/ Howard D. Adams
----------------------------
Its: Chairman
---------------------------

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EXHIBIT B
FORM OF
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
WINTRUST FINANCIAL CORPORATION

Wintrust Financial Corporation (the "Corporation") was incorporated on
December 30, 1992 under the name Wintrust Investment Corporation. On March 18,
1993, the name of the Corporation was changed to Wintrust Investments, Inc. On
May 27, 1994, the name of the Corporation was changed to North Shore Community
Bancorp, Inc. The Articles of Incorporation be and the same hereby are amended
and restated to read as follows:

**ARTICLE ONE: The name of the Corporation is Wintrust Financial Corporation.

*ARTICLE TWO: The name and address of the registered agent and registered
office are:

Registered Agent - John F. Purtill, Esq.

Registered Office - 1515 East Woodfield Road
Suite 250
Schaumburg, Illinois 60173-5431

**ARTICLE THREE: Purpose or purposes for which the Corporation is organized:
The transaction of any or all lawful businesses for which corporations may be
incorporated under the Illinois Business Corporation Act of 1983, as amended
(the "BCA").

**ARTICLE FOUR, Paragraph 1: Authorized Shares, Issued Shares and
Consideration Received. The class, number of shares, and the par value, if any,
of each class of stock which the Corporation shall have authority to issue
shall be as follows:

Number of
Class Par Value Per Share Shares Authorized
----- ------------------- -----------------

Common no par value 30,000,000
Preferred no par value 20,000,000

Shares of the Corporation may be issued from time to time in such
manner, amounts and proportions and for such consideration as shall be fixed by
the Board of Directors of the Corporation.

Paragraph 2: The preferences, qualifications, limitations,
restrictions and the special or relative rights in respect of the shares of
each class are as follows:

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COMMON STOCK

(a) Dividends. Subject to any rights to receive
dividends to which the holders of the shares of the Preferred Stock
may be entitled, the holders of shares of Common Stock shall be
entitled to receive dividends, if and when declared payable from time
to time by the Board of Directors from any funds legally available
therefor.

(b) Liquidation. In the event of any dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, after there shall have been paid to the holders of shares
of Preferred Stock the full amounts to which they shall be entitled,
the holders of the then outstanding shares of Common Stock shall be
entitled to receive, pro rata, all of the remaining assets of the
Corporation available for distribution to its shareholders. The Board
of Directors may distribute in kind to the holders of the shares of
Common Stock such remaining assets of the Corporation or may sell,
transfer or otherwise dispose of all or any part of such remaining
assets to any other corporation, trust or other entity and receive
payment therefor in cash, stock or obligations of such other
corporation, trust or entity, or any combination thereof, and may sell
all or any part of the consideration so received and distribute any
balance thereof in kind to holders of the shares of Common Stock. The
merger or consolidation of the Corporation into or with any other
corporation, or the merger of any other corporation into it, or any
purchase or redemption of shares of stock of the Corporation of any
class, shall not be deemed to be a dissolution, liquidation or winding
up of the Corporation for the purpose of this paragraph (b).

(c) Voting. Each outstanding share of Common Stock of
the Corporation shall entitle the holder thereof to one vote on each
matter submitted to a vote at a meeting of the shareholders.

PREFERRED STOCK

The Board of Directors is expressly authorized to adopt, from
time to time, a resolution or resolutions providing for the issuance
of Preferred Stock in one or more series, to fix the number of shares
in each such series and to fix the designations and powers,
preferences and relative, participating, optional or other special
rights, and the qualifications, limitations and restrictions thereof,
of each such series. The authority of the Board of Directors with
respect to each such series shall include a determination of the
following (which may vary as between the different series of Preferred
Stock):

(a) The number of shares constituting the series and the
distinctive designation of the series;

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(b) The dividend rate on the shares of the series, the
conditions and dates upon which dividends thereon shall be payable,
the extent, if any, to which dividends thereon shall be cumulative,
and the relative rights of preference, if any, of payment of dividends
thereon;

(c) Whether or not the shares of the series are
redeemable and, if redeemable, including the times during which they
shall be redeemable and the amount per share payable in case of
redemption, which amount may, but need not, vary according to the time
and circumstances of such action;

(d) The amount payable in respect of the shares of the
series, in the event of any liquidation, dissolution or winding up of
the Corporation, which amount may, but need not, vary according to the
time or circumstances of such action, and the relative rights of
preference, if any, of payment of such amount;

(e) Any requirement as to a sinking fund for the shares
of the series, or any requirement as to the redemption, purchase or
other retirement by the Corporation of the shares of the series;

(f) The right, if any, to exchange or convert shares of
the series into shares of any other series or class of stock of the
Corporation and the rate or basis, time, manner and condition of
exchange or conversion;

(g) The voting rights, if any, to which the holders of
shares of the series shall be entitled in addition to the voting
rights provided by law; and

(h) Any other term, condition or provision with respect
to the series not inconsistent with the provisions of this Article
Four or any resolution adopted by the Board of Directors pursuant
thereto.

**ARTICLE FIVE: No holder of any class of shares of the Corporation shall have
any cumulative voting rights in the election of directors or in any other
circumstances.

**ARTICLE SIX: No holder of any class of shares of the Corporation shall be
entitled as such as a matter of right to subscribe for or purchase any part (a)
of any shares of any class of the Corporation whether now authorized or
hereafter created, or (b) of any securities whether non-convertible, or
convertible into or evidencing the right to purchase or acquire shares of any
class of the Corporation, whether now authorized or hereafter created and
whether in either case issued or sold for cash, property, services or
otherwise.

**ARTICLE SEVEN: Any action required or permitted to be taken by the holders
of any class of shares of the Corporation must be effected at a duly called
annual or special meeting of such holders and may not be effected by any
consent in writing by such holders.

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**ARTICLE EIGHT: No director of the Corporation shall be liable to the
Corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director except for liability (a) for any breach of the director's
duty of loyalty to the Corporation or its shareholders, (b) for acts or
omissions not in good faith or that involve intentional misconduct of a knowing
violation of law, (c) under Section 8.65 of the BCA, as the same exists or
hereafter may be amended, or (d) for any transaction from which the director
derived an improper personal benefit.

**ARTICLE NINE, Paragraph 1: The Corporation shall indemnify, to the full
extent that it shall have power under applicable law to do so and in a manner
permitted by such law, any person made or threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he or she
is or was a director, officer, employee or agent of the Corporation, or who is
or was serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against liabilities and expenses reasonably incurred or paid
by such person in connection with such action, suit or proceeding. The
Corporation may indemnify, to the full extent that it shall have power under
applicable law to do so and in a manner permitted by such law, any person made
or threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or she is or was a director,
officer, employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
liabilities and expenses reasonably incurred or paid by such person in
connection with such action, suit or proceeding. The words "liabilities" and
"expenses" shall include, without limitation: liabilities, losses, damages,
judgments, fines, penalties, amounts paid in settlement, expenses, attorneys'
fees and costs. Expenses incurred in defending a civil, criminal,
administrative, investigative or other action, suit or proceeding may be paid
by the Corporation in advance of the final disposition of such action, suit or
proceeding in accordance with the provisions of Section 8.75 of the BCA.

The indemnification and advancement of expenses provided by this
Article shall not be deemed exclusive of any other rights to which any person
indemnified may be entitled under any statute, by-law, agreement, vote of
shareholders, or disinterested directors or otherwise, both as to action in his
official capacity and as to action in any other capacity while holding such
office, and shall continue as to a person who has ceased to be such director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person.

Paragraph 2: The Corporation may purchase and maintain insurance on
behalf of any person referred to in the preceding paragraph against any
liability asserted against him or her and incurred by him or her in any such
capacity, or arising out of his or her status as such, whether or not the
Corporation would have the power to indemnify him or her against such liability
under the provisions of this Article or otherwise.

Paragraph 3: For purposes of this Article, references to "the
Corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent

AB-4
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of a constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the
provisions of this Article with respect to the resulting or surviving
corporation as he or she would have with respect to such constituent
corporation if its separate existence had continued.

Paragraph 4: The provisions of this Article shall be deemed to be a
contract between the Corporation and each director or officer who serves in any
such capacity at any time while this Article and the relevant provisions of the
BCA, or other applicable law, if any, are in effect, and any repeal or
modification of any such law or of this Article shall not affect any rights or
obligations then existing with respect to any state of facts then or
theretofore existing or any action, suit or proceeding theretofore or
thereafter brought or threatened based in whole or in part upon any such state
of facts.

Paragraph 5: For purposes of this Article, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the Corporation"
shall include any service as a director, officer, employee or agent of the
Corporation which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to any employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in a
manner he or she reasonably believed to be in the interest of the participants
and beneficiaries of an employee benefit plan shall be deemed to have acted in
a manner not opposed to the best interests of the Corporation.

**ARTICLE TEN: The number of directors of the Corporation shall be that
number set forth in the By-laws, as may be increased or decreased from time to
time; provided, however, that such number shall never be less than six (6).

Paragraph 1: The directors shall be divided into three classes, as
equal in number as possible, with respect to the times for which they shall hold
office. Directors of the first class first elected shall hold office for one
year or until the first annual election following their election, directors of
the second class first elected shall hold office for two years or until the
second annual election following their election, and directors of the third
class first elected shall hold office for three years or until the third annual
election following their election and in each case until their successors shall
be duly elected and shall qualify.

Paragraph 2: At each annual meeting of the shareholders following
such first election of the directors of all classes, the successors to the class
of directors whose terms shall expire at such meeting shall be elected to hold
office for a term of three years, so that in each year the term of office of one
class of directors shall expire.

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Paragraph 3: Directors need not be residents of Illinois or
shareholders of the Corporation.

**ARTICLE ELEVEN: The Corporation expressly elects to be governed by Section
7.85 of the BCA as may be amended from time to time.

**ARTICLE TWELVE: The Corporation expressly elects not to be governed by
Section 11.75 of the BCA.

**ARTICLE THIRTEEN: Notwithstanding any other provision of these Articles of
Incorporation or the By-laws of the Corporation (and not withstanding the fact
that a lessor percentage may be specified by law, these Articles of
Incorporation or the By-laws of the Corporation), the affirmative vote of the
holders of 85% or more of the voting power of the then-outstanding shares of
stock of the Corporation entitled to vote generally in the election of
directors, voting together as a single class, shall be required to amend or
repeal, or adopt any provision inconsistent with Articles Five, Six, Seven,
Eight, Nine, Ten, Eleven, Twelve and this Article Thirteen.

- ------------------------------
* Restated only
** Amended and Restated

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EXHIBIT C
BY-LAWS

WINTRUST FINANCIAL CORPORATION
(AN ILLINOIS CORPORATION)

ARTICLE I

OFFICES

Wintrust Financial Corporation (the "corporation") shall
continuously maintain in the State of Illinois a registered office and a
registered agent whose office is identical with such registered office, and may
have other offices within or without the state.

ARTICLE II

SHAREHOLDERS

SECTION 2.1 ANNUAL MEETING. An annual meeting of the
shareholders shall be held on the fourth Thursday in May of each year, or such
other date as designated by the board of directors, for the purpose of electing
directors and for the transaction of such other business as may come before the
meeting. If the directors shall not be elected at the annual meeting, or at
any adjournment thereof, the board of directors shall cause the election to be
held as soon thereafter as practicable.

SECTION 2.2 SPECIAL MEETINGS. Special meetings of
the shareholders may be called either by the chairman of the board of directors
or president for the purpose or purposes stated in the call of the meeting.

SECTION 2.3 PLACE OF MEETING. The board of directors
may designate any place as the place of meeting for any annual meeting or for
any special meeting called by the board of directors. If no designation is
made, or if a special meeting be otherwise called, the place of meeting shall
be at the office of the registered agent of the corporation in the State of
Illinois.

SECTION 2.4 NOTICE OF MEETINGS. Written notice
stating the place, date, and hour of the meeting, and in the case of a special
meeting, the purpose or purposes for which the meeting is called shall be
delivered not less than ten nor more than forty days before the date of the
meeting, or in the case of a merger or consolidation not less than twenty nor
more than forty days before the meeting, either personally or by mail, by or at
the direction of the president, or the secretary, or the officer or persons
calling the meeting. If mailed, such

AC-1
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notice shall be deemed to be delivered when deposited in the United States
mail, addressed to the shareholder's address as it appears on the records of
the corporation, with postage thereon prepaid. When a meeting is adjourned to
another time or place, notice need not be given of the adjourned meeting if the
time and place thereof are announced at the meeting at which the adjournment is
taken.

SECTION 2.5 NOTIFICATION OF SHAREHOLDER PROPOSED
BUSINESS. At an annual or special meeting of shareholders, only such business
shall be conducted as shall have been properly brought before the meeting. To
properly bring business before an annual or special meeting of shareholders,
written notice of such shareholder's intent to make such proposal or proposals,
including the nomination for election of director, must be given either by
personal delivery or by United States mail postage prepaid and received by the
Secretary of the corporation not later than the following dates: (i) with
respect to an annual meeting of shareholders, 60 days in advance of such
meeting if such meeting is to be held on a day which is within 30 days
preceding the anniversary date of the previous year's annual meeting or 90 days
in advance of such meeting if such meeting is to be held on or after the
anniversary of the previous year's annual meeting; and (ii) with respect to any
other annual or special meeting of shareholders, the close of business on the
tenth day following the date of public disclosure of the date of such meeting.
A shareholder's notice to the Secretary shall set forth as to each item of
business the shareholder proposes to bring before such meeting: (a) a brief
description of the business desired to be brought before the meeting, and in
this case of a nomination for election of director, such nominee's name and
qualifications, and the reasons for conducting the business at the meeting; (b)
the name and record address of the shareholder who proposes such business; (c)
the number of shares of stock of the Corporation beneficially owned by such
shareholder; and (d) a description of all arrangements or understandings
between the shareholder and any other person or persons (naming such person or
persons) pursuant to which the proposal or proposals are to be made by the
shareholder and any material interest of the shareholder in the business being
proposed. The chairman of the meeting may refuse to acknowledge the proposal
of any shareholder not made in compliance with this Section 2.5.

Notwithstanding anything in the by-laws to the contrary, no business
shall be brought before or conducted at an annual or special meeting by a
shareholder except in accordance with the procedures set forth in this Section
2.5; provided, however, that nothing in this Section 2.5 shall be deemed to
preclude discussion by any shareholder of any business properly brought before
a shareholder meeting.

SECTION 2.6 POSTPONEMENT AND ADJOURNMENT OF MEETINGS.
Prior to any annual or special meeting of shareholders being called to order,
the board of directors may postpone such previously scheduled annual or special
meeting of shareholders at any time whether or not a quorum is present without
further notice. The board of directors may adjourn any previously scheduled
annual or special meeting of shareholders at any time whether or not a quorum
is present without further notice.

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SECTION 2.7 FIXING OF RECORD DATE. For the purpose
of determining the shareholders entitled to notice of or to vote at any meeting
of shareholders or any adjournment thereof, or to receive payment of any
dividend, or other distribution or allotment of any rights, or to exercise any
rights in respect of any change, conversion or exchange of shares or for the
purpose of any other lawful action, the board of directors of the corporation
may fix in advance a record date which shall not be more than sixty days, and
for a meeting of shareholders, not less than ten days, or in the case of a
merger or consolidation not less than twenty days, before the date of such
meeting. If no record date is fixed, the record date for the determination of
shareholders shall be the date on which the notice of the meeting is mailed,
and the record date for the determination of shareholders for any other purpose
shall be the date on which the board of directors adopts the resolution
relating thereto. A determination of shareholders of record entitled to notice
of or to vote at a meeting of shareholders shall apply to any adjournment of
the meeting.

SECTION 2.8 VOTING LISTS. The officer or agent
having charge of the transfer books for shares of the corporation shall make,
at least ten days before each meeting of shareholders, a complete list of the
shareholders entitled to vote at such meeting, arranged in alphabetical order,
showing the address of and the number of shares registered in the name of the
shareholder, which list, for a period of ten days prior to such meeting, shall
be kept on file at the registered office of the corporation and shall be open
to inspection by any shareholder for any purpose germane to the meeting, at any
time during usual business hours. Such list shall also be produced and kept
open at the time and place of the meeting and may be inspected by any
shareholder during the whole time of the meeting. The original share ledger or
transfer books, or a duplicate thereof kept in this State, shall be prima facie
evidence as to who are the shareholders entitled to examine such list or share
ledger or transfer book or to vote at any meeting of shareholders.

SECTION 2.9 QUORUM. The holders of a majority of the
outstanding common shares of the corporation, present in person or represented
by proxy, shall constitute a quorum at any meeting of shareholders; provided
that if less than a majority of the outstanding shares are represented at said
meeting, a majority of the shares so represented may adjourn the meeting at any
time without further notice. If a quorum is present, the affirmative vote of
the majority of the shares represented at the meeting shall be the act of the
shareholders, unless the vote of a greater number or voting by classes is
required by The Business Corporation Act of the State of Illinois (the "BCA"),
the articles of incorporation or these by-laws. At any adjourned meeting at
which a quorum shall be present, any business may be transacted which might
have been transacted at the original meeting. Withdrawal of shareholders from
any meeting shall not cause failure of a duly constituted quorum at that
meeting.

SECTION 2.10 PROXIES. Each shareholder entitled to
vote at a meeting of shareholders or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for such
shareholder by proxy executed in writing by such shareholder or his or her duly
authorized attorney-in-fact, but no such proxy shall be valid after eleven
months from the date of its execution, unless otherwise provided in the proxy.

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SECTION 2.11 VOTING OF SHARES. Each outstanding
common share shall be entitled to one vote upon each matter submitted to vote
at a meeting of shareholders. Any preferred stock shall have such rights,
voting or otherwise, as shall be determined by the board of directors and as
set forth in a certificate of designation filed with the Illinois Secretary of
State.

SECTION 2.12 VOTING OF SHARES BY CERTAIN HOLDERS.
Shares standing in the name of another corporation, domestic or foreign, may be
voted by such officer, agent, or proxy as the by-laws of such corporation may
prescribe, or, in the absence of such provision, as the board of directors of
such corporation may determine.

Shares standing in the name of a deceased person, a minor ward
or an incompetent person, may be voted by the administrator, executor, court
appointed guardian, or conservator of such person or such person's estate,
either in person or by proxy without a transfer of such shares into the name of
such administrator, executor, court appointed guardian, or conservator. Shares
standing in the name of a trustee may be voted by the trustee, either in person
or by proxy.

Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into the receiver's name if
authority so to do be contained in the appropriate order of the court by which
such receiver was appointed.

A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares so
transferred.

Any number of shareholders may create a voting trust for the
purpose of conferring upon a trustee or trustees the right to vote or otherwise
represent their shares, for a period not to exceed ten years by entering into a
written voting trust agreement specifying the terms and conditions of the
voting trust, and by transferring their shares to such trustee or trustees for
the purpose of the agreement. Any such trust agreement shall not become
effective until a counterpart of the agreement is deposited with the
corporation at its registered office. The counterpart of the voting trust
agreement so deposited with the corporation shall be subject to the same right
of examination by a shareholder of the corporation, in person or by agent or
attorney, as are the books and records of the corporation, and shall be subject
to examination by any holder of a beneficial interest in the voting trust,
either in person or by agent or attorney, at any reasonable time for any proper
purpose.

Shares of its own stock belonging to this corporation shall
not be voted, directly or indirectly, at any meeting and shall not be counted
in determining the total number of outstanding shares at any given time, but
shares of its own stock held by it in a fiduciary capacity may be voted and
shall be counted in determining the total number of outstanding shares at any
given time.

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SECTION 2.13 ELIMINATION OF CUMULATIVE VOTING RIGHTS.
The holders of all shares of stock having a right to vote in this corporation
shall not be entitled to cumulative voting rights in the election of directors
of this corporation, or for any other reason or purpose whatsoever.

SECTION 2.14 INSPECTORS. At any meeting of
shareholders, the presiding officer may, or upon the request of any shareholder
shall, appoint one or more persons as inspectors for such meeting.

Such inspectors shall ascertain and report the number of
shares represented at the meeting, based upon their determination of the
validity and effect of proxies; count all votes and report the results; and do
such other acts as are proper to conduct the election and voting with
impartiality and fairness to all the shareholders.

Each report of an inspector shall be in writing and signed by
the inspector or by a majority of them if there be more than one inspector
acting at such meeting. If there is more than one inspector, the report of a
majority shall be the report of the inspectors. The report of the inspector or
inspectors on the number of shares represented at the meeting and the results
of the voting shall be prima facie evidence thereof.

SECTION 2.15 ACTION BY SHAREHOLDERS. Any action
required or permitted to be taken at a meeting of the shareholders must be
effected at a duly called annual or special meeting and may not be effected by
any consent in writing by such holders.

SECTION 2.16 VOTING BY BALLOT. Voting on any question
or in any election may be by voice unless the presiding officer shall order or
any shareholder shall demand that voting be by ballot.

ARTICLE III

DIRECTORS

SECTION 3.1 GENERAL POWERS. The business of the
corporation shall be managed by its board of directors.

SECTION 3.2 NUMBER, TENURE AND QUALIFICATIONS. The
number of directors of the corporation shall be twenty-one (21). The number of
directors may be increased or decreased (provided, however, that such number
shall never be less than six (6)) from time to time by the amendment of this
section by a resolution adopted by the majority of members of the board of
directors as provided in this Section 3.2; but no decrease shall have the
effect of shortening the term of any incumbent director.

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The directors shall be divided into three classes, as equal in
number as possible, with respect to the times for which they shall hold office.
Directors of the first class shall hold office for one year or until the first
annual election following their election, directors of the second class shall
hold office for two years or until the second annual election following their
election, and directors of the third class shall hold office for three years or
until the third annual election following their election and in each case until
their successors shall be duly elected and shall qualify.

At each annual meeting of the shareholders following such
first election of the directors of all classes, the successors to the class of
directors whose terms shall expire at such meeting shall be elected to hold
office for a term of three years, so that in each year the term of office of
one class of directors shall expire.

Directors need not be residents of Illinois or shareholders of the corporation.

Advance notice of shareholder nominations for the election of
directors and of business to be brought by shareholders before any meeting of
the shareholders of the corporation shall be given in the manner provided in
these by-laws.

SECTION 3.3 REGULAR MEETINGS. A regular meeting of
the board of directors shall be held without other notice than this by-law,
either immediately before or after the annual meeting of shareholders, or at
such time as may be determined by the board of directors. The board of
directors may provide, by resolution, the time and place for the holding of
additional regular meetings without other notice than such resolution.

SECTION 3.4 SPECIAL MEETINGS. Special meetings of
the board of directors may be called by or at the request of the chairman of
the board of directors, president or a majority of the then acting board of
directors. The person or persons authorized to call special meetings of the
board of directors may fix any place as the place for holding any special
meeting of the board of directors called by them.

SECTION 3.5 NOTICE. Notice of any special meeting
shall be given at least two (2) days previous thereto by written notice to each
director at his or her business address. If mailed, notice shall be deemed to
be delivered when deposited in the United States mail so addressed, with
postage thereon prepaid. If notice be given by telegram, such notice shall be
deemed to be delivered when the telegram is delivered to the telegram company.
The attendance of a director at any meeting shall constitute a waiver of notice
of such meeting, except where a director attends a meeting for the express
purpose of objecting to the transaction of any business because the meeting is
not lawfully called or convened. Neither the business to be transacted at, nor
the purpose of, any regular or special meeting of the board of directors need
be specified in the notice or waiver of notice of such meeting.

SECTION 3.6 QUORUM. A majority of the number of
directors fixed by these by-laws shall constitute a quorum for the transaction
of business at any meeting of the

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board of directors, provided that if less than a majority of such number of
directors are present at said meeting, a majority of the directors present may
adjourn the meeting at any time without further notice.

SECTION 3.7 MANNER OF ACTING. The act of the
majority of the directors present at a meeting at which a quorum is present
shall be the act of the board of directors, unless the act of a greater number
is required by statute, these by-laws, or the articles of incorporation.

SECTION 3.8 VACANCIES. Any vacancy occurring in the
board of directors resulting from death, resignation, retirement,
disqualification, removal from office or other cause, and any directorship
resulting from any increase in the authorized number of directors or otherwise
may be filled only by a majority vote of the directors then in office, though
less than a quorum, and directors so chosen shall hold office for a term
expiring at the annual meeting of shareholders at which the term of office of
the class to which they have been elected.

SECTION 3.9 ACTION WITHOUT A MEETING. Unless
specifically prohibited by the articles of incorporation or by-laws, any action
required to be taken at a meeting of the board of directors, or any other
action which may be taken at a meeting of the board of directors, or of any
committee thereof may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all the directors
entitled to vote with respect to the subject matter thereof, or by all the
members of such committee, as the case may be. Any such consent signed by all
the directors or all the members of the committee shall have the same effect
as a unanimous vote, and may be stated as such in any document filed with the
Secretary of State or with anyone else.

SECTION 3.10 COMPENSATION. The board of directors, by
the affirmative vote of a majority of directors then in office, and
irrespective of any personal interest of any of its members, shall have
authority to establish reasonable compensation of all directors for services to
the corporation as directors, officers, or otherwise. By resolution of the
board of directors the directors may be paid their expenses, if any, of
attendance at each meeting of the board of directors and of committees thereof.
No such payment previously mentioned in this section shall preclude any
director from serving the corporation in any other capacity and receiving
compensation therefor.

SECTION 3.11 COMMITTEES. The board of directors, by
resolution, may create one or more committees and appoint members of the board
of directors to serve on the committee or committees. Each committee shall
have two or more members, who shall serve at the pleasure of the board of
directors. Unless the appointment by the board of directors requires a greater
number, a majority of any committee shall constitute a quorum and a majority of
a quorum is necessary for committee action. A committee may act by unanimous
consent in writing without a meeting and, subject to the provisions of these
by-laws or action by the board of directors, the committee by majority vote of
its members shall determine the time and place of meetings and the notice
required therefor. To the extent specified by the board of directors,

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each committee may exercise all the authority of the board of directors in the
management of the corporation as permitted by the BCA. Each committee shall
keep regular minutes of its proceedings and report the same to the board of
directors.

ARTICLE IV

OFFICERS

SECTION 4.1 NUMBER. The officers of the corporation
shall be the chairman of the board of directors, the president, one or more
executive vice-presidents, senior vice-presidents and vice-presidents (the
number thereof to be determined by the board of directors), a treasurer, a
secretary, and such assistant treasurers, assistant secretaries or other
officers as may be elected by the board of directors. Any two or more offices
may be held by the same person, except the offices of president and secretary;
provided, however, that in cases where all of the shares of the corporation are
owned of record by one shareholder and these by-laws provide that the number
of directors shall be one, the offices of president and secretary may be held
by the same person.

SECTION 4.2 ELECTION AND TERM OF OFFICE. The
officers of the corporation shall be elected annually by the board of directors
at the first meeting of the board of directors held after each annual meeting
of shareholders. If the election of officers shall not be held at such
meeting, such election shall be held as soon thereafter as may be convenient.
Vacancies may be filled or new offices created and filled at any meeting of the
board of directors. Each officer shall hold office until a successor shall
have been duly elected and shall have qualified or until the death,
resignation, or removal (in the manner hereinafter provided) of such officer.
Election of an officer shall not of itself create contract rights.

SECTION 4.3 REMOVAL. Any officer elected or
appointed by the board of directors may be removed by the board of directors
whenever in its judgment the best interests of the corporation would be served
thereby, but such removal shall be without prejudice to the contract rights, if
any, of the person so removed.

SECTION 4.4 CHAIRMAN OF THE BOARD. The chairman of
the board shall be elected by and from the membership of the board of
directors. He shall be the chief executive officer of the corporation.
Subject to the control of the board of directors, the chairman of the board
shall, in general, supervise and manage the business and affairs of the
corporation and he shall see that the resolutions and directions of the board
of directors are carried into effect. Except in those instances in which the
authority to execute is expressly delegated to another officer or agent of the
corporation, or a different mode of execution is expressly prescribed by the
board of directors or these by-laws, or where otherwise required by law, the
chairman of the board may execute for the corporation any contracts, deeds,
mortgages, bonds or other instruments which the board of directors has
authorized to be executed or the execution of which is in the ordinary course
of the corporation's business, and he may

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accomplish such execution either under or without the seal of the corporation
and either individually or with the secretary, any assistant secretary, or any
other officer thereunto authorized by the board of directors or these by-laws.
The chairman of the board shall preside at all meetings of the shareholders and
of the board of directors (and of any executive committee thereof), and shall
perform such other duties as from time to time shall be prescribed by the board
of directors.

SECTION 4.5 PRESIDENT. The president shall be the
chief operating officer of the corporation. In the absence of the chairman of
the board or in the event of his inability to act or while such office is
vacant, the president shall perform the duties of the chairman of the board and
when so acting shall have all of the powers and authority of, and shall be
subject to all of the restrictions upon, the chairman of the board. Except in
those instances in which the authority to execute is expressly delegated to
another officer or agent of the corporation or a different mode of execution is
expressly prescribed by the board of directors or these by-laws or were
otherwise required by law, he may execute for the corporation any contracts,
deeds, mortgages, bonds or other instruments which the board of directors has
authorized to be executed or the execution of which is in the ordinary course
of the corporation's business, and he may accomplish such execution either
under or without the seal of the corporation and either individually or with
the secretary, any assistant secretary, or any other officer thereunto
authorized by the board of directors or these by-laws. In general, he shall
perform such other duties as from time to time may be prescribed by the
chairman of the board or the board of directors.

SECTION 4.6 THE VICE-PRESIDENTS. The executive
vice-president, senior vice-president, or vice-president (or in the event there
be more than one executive vice-president, senior vice-president or
vice-president, each of the executive vice-presidents, senior vice-presidents
or vice-presidents (collectively the "vice-presidents")) shall assist the
president in the discharge of the president's duties as the president may
direct and shall perform such other duties as from time to time may be assigned
by the chairman of the board, the president or by the board of directors. In
the president's absence, inability or refusal to act, the executive
vice-president, senior vice- president or vice-president (or in the event there
be more than one executive vice-president, senior vice-president or
vice-president, each of the executive vice-presidents, senior vice-presidents
or vice-presidents in the order designated by the board of directors, or by the
president if the board of directors has not made such a designation, or in the
absence of any designation, then in the order of seniority of tenure of the
executive vice-president, the senior vice-president or vice-president) shall
perform the duties of the president, and when so acting, shall have all the
powers of and be subject to all the restrictions upon the president. Except in
those instances in which the authority to execute is expressly delegated to
another officer or agent of the corporation or a different mode of execution is
expressly prescribed by the board of directors or these by-laws, the
vice-presidents (or each of them if there is more than one) may execute for the
corporation certificates for its shares and any contracts, deeds, mortgages,
bonds or other instruments which the board of directors has authorized to be
executed, and may further accomplish such execution either under or without the
seal of the corporation and either individually or with the secretary, any
assistant secretary, or any other

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officer thereunto authorized by the board of directors according to the
requirements of the form of the instrument.

SECTION 4.7 THE TREASURER AND CHIEF FINANCIAL
OFFICER. The treasurer shall be the principal accounting and chief financial
officer of the corporation. The treasurer shall: (a) have charge of and be
responsible for the maintenance of adequate books of account for the
corporation; (b) have charge and custody of all funds and securities of the
corporation, and be responsible therefor and for the receipt and disbursement
thereof; and (c) perform all the duties incident to the office of treasurer and
chief financial officer and such other duties as from time to time may be
assigned by the chairman of the board, the president or by the board of
directors. If required by the board of directors, the treasurer shall give a
bond for the faithful discharge of all duties in such sum and with such surety
or sureties as the board of directors may determine.

SECTION 4.8 THE SECRETARY. The secretary shall: (a)
record the minutes of the shareholders' and of the board of directors' meetings
in one or more books provided for that purpose; (b) see that all notices are
duly given in accordance with the provisions of these by-laws or as required by
law; (c) be custodian of the corporate records and of the seal of the
corporation; (d) keep a register of the post-office address of each shareholder
which shall be furnished to the secretary by such shareholder; (e) sign with
the president, or a vice-president, or any other officer thereunto authorized
by the board of directors, certificates for shares of the corporation, the
issue of which shall have been authorized by the board of directors, and any
contracts, deeds, mortgages, bonds, or other instruments which the board of
directors has authorized to be executed, according to the requirements of the
form of the instrument, except when a different mode of execution is expressly
prescribed by the board of directors or these by-laws; (f) have general charge
of the stock transfer books of the corporation; and (g) perform all duties
incident to the office of secretary and such other duties as from time to time
may be assigned by the chairman of the board, the president or by the board of
directors.

SECTION 4.9 ASSISTANT TREASURERS AND ASSISTANT
SECRETARIES. The assistant treasurers and assistant secretaries shall perform
such duties as shall be assigned to them by the treasurer or the secretary,
respectively, or by the chairman of the board, the president or the board of
directors. The assistant secretaries may sign with the chairman of the board,
the president, or a vice-president, or any other officer thereunto authorized
by the board of directors, certificates or shares of the corporation, the issue
of which shall have been authorized by the board of directors, and any
contracts, deeds, mortgages, bonds, or other instruments which the board of
directors has authorized to be executed, according to the requirements of the
form of the instrument except when a different mode of execution is expressly
prescribed by the board of directors or these by-laws. The assistant
treasurers shall respectively, if required by the board of directors, give
bonds for the faithful discharge of their duties in such sums and with such
sureties as the board of directors shall determine.

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SECTION 4.10 SALARIES. The salaries of the officers
shall be fixed from time to time by the board of directors and no officer shall
be prevented from receiving such salary by reason of the fact that such officer
is also a director of the corporation.

ARTICLE V

CONTRACTS, LOANS, CHECKS DEPOSITS

SECTION 5.1 CONTRACTS. The board of directors may
authorize any officer or officers, agent or agents, to enter into any contract
or execute and deliver any instrument in the name of and on behalf of the
corporation, and such authority may be general or confined to specific
instances.

SECTION 5.2 LOANS. No loans shall be contracted on
behalf of the corporation and no evidences of indebtedness shall be issued in
its name unless authorized by a resolution of the board of directors. Such
authority may be general or confined to specific instances.

SECTION 5.3 CHECKS, DRAFTS, ETC. All checks, drafts
or other orders for the payment of money, notes or other evidences of
indebtedness issued in the name of the corporation, shall be signed by such
officer or officers, agent or agents of the corporation and in such manner as
shall from time to time be determined by resolution of the board of directors.

SECTION 5.4 DEPOSITS. All funds of the corporation
not otherwise employed shall be deposited from time to time to the credit of
the corporation in such banks, trust companies or other depositories as the
board of directors may select.

ARTICLE VI

INDEMNIFICATION OF OFFICERS,
DIRECTORS, EMPLOYEES AND AGENTS

SECTION 6.1 GENERALLY. The corporation shall have
power to indemnify any persons who were or are parties or are threatened to be
made parties to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation) by reason of the fact
that they are or were directors, officers, employees or agents of the
corporation, or are or were serving at the request of the corporation as
directors, officers, employees or agents of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by them in connection with such action, suit or proceeding
if they acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interests of the cor-

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poration, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful. The corporation
shall have the power to indemnify any persons who were or are parties or are
threatened to be made parties to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that they are or were directors, officers, employees or agents of any
subsidiary corporation or corporations (individually the "subsidiary" and
collectively the "subsidiaries") against expenses, (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by them in connection with such action, suit or proceeding if they acted in good
faith and in a manner that they reasonably believed to be in or not opposed to
the best interests of the corporation and/or the respective subsidiary or
subsidiaries, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the persons did not act in good faith or in a manner which
they reasonably believed to be in or not opposed to the best interests of the
corporation, a subsidiary or the subsidiaries, as the case may be, and with
respect to any criminal action or proceeding, had reasonable cause to believe
that their conduct was unlawful.

SECTION 6.2 DERIVATIVE ACTIONS. The corporation
shall have power to indemnify any persons who were or are parties or are
threatened to be made parties to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor
by reason of the fact that they are or were directors, officers, employees or
agents of the corporation, or are or were serving at the request of the
corporation as directors, officers, employees or agents of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by them in
connection with the defense or settlement of such action or suit if they acted
in good faith and in a manner they reasonably believed to be in or not opposed
to the best interests of the corporation and except that no indemnification
shall be made in respect of any claim, issue or matter as to which such persons
shall have been adjudged to be liable for negligence or misconduct in the
performance of their duty to the corporation unless and only to the extent that
the court in which such action or suit was brought shall determine upon
application that despite the adjudication of liability but in view of all the
circumstances of the case, such persons are fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper. The corporation
shall have the power to indemnify any person or persons who were or are parties
or are threatened to be made parties to any threatened, pending or completed
action or suit by or in the or right of any of the subsidiaries to procure a
judgment in its favor by reason of the fact that such persons are or were
directors, officers, employees or agents of any one or more of the
subsidiaries, or are or were serving at the request of the corporation as
directors, officer, employees or agents of such subsidiary or subsidiaries,
against expenses (including attorneys' fees), actually and reasonably incurred
by them in connection with the defense or settlement of such action or suit if
they acted in good faith and in a matter they reasonably believe to be in or
not opposed to the best interests of the subsidiary or subsidiaries, as the
case may be, except that no indemnification shall be made with respect to any
claim, issue or matter

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as to which such persons shall have been adjudged to be liable for negligence
or misconduct in the performance of their duty to the subsidiary or
subsidiaries, as the case may be, unless and only to the extent that the court
in which such action or suit was brought shall determine upon application that
despite the adjudication of liability but in view of all of the circumstances
of the case, such persons are fairly and reasonably entitled to indemnity for
such expenses which the court shall deem proper.

SECTION 6.3 MANDATORY INDEMNIFICATION. To the extent
that a director, officer, employee or agent of a corporation, or any subsidiary
or subsidiaries, as the case may be, has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in Sections
6.1 and 6.2, or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.

SECTION 6.4 FIDUCIARY DUTY. A director of the
corporation shall not be personally liable to the corporation or its
shareholders for monetary damages for breach of fiduciary duty as a director,
except for liability (a) for any breach of the director's duty of loyalty to
the corporation or its shareholders, (b) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(c) under Section 8.65 of the BCA, as the same exists or hereafter may be
amended, or (d) for any transaction from which the director derived an improper
personal benefit.

SECTION 6.5 AUTHORIZATION. Any indemnification under
Sections 6.1 and 6.2 (unless ordered by a court) shall be made by the
corporation only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in the
circumstances because he or she has met the applicable standards of conduct set
forth in Sections 6.1 and 6.2. Such determination shall be made (a) by the
board of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or (b) if such a quorum is
not obtainable, or, even if obtainable, a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (c) by the
shareholders.

SECTION 6.6 EXPENSES. Expenses incurred in defending
a civil or criminal action, suit or proceeding may be paid by the corporation
in advance of the final disposition of such action, suit or proceeding, as
authorized by the board of directors in the specific case, upon receipt of an
undertaking by or on behalf of the director, officer, employee or agent to
repay such amount, unless it shall ultimately be determined that he is entitled
to be indemnified by the corporation as authorized in this Section.

SECTION 6.7 NONEXCLUSIVE. The indemnification
provided by this article shall not be deemed exclusive of any other rights to
which those seeking indemnification may be entitled under any by-law,
agreement, vote of shareholders or disinterested directors or otherwise, both
as to action in their official capacities and as to action in another capacity
while holding such office, and shall continue as to a person who has ceased to
be a director, officer,

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employee, or agent and shall inure to the benefit of the heirs, executors and
administrators of such a person. The corporation shall have power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against any
liability asserted against such person and incurred by him or her in any such
capacity, or arising out of such person's status as such, whether or not the
corporation would have the power to indemnify him or her against such liability
under the provisions of this article.

ARTICLE VII

CERTIFICATES FOR SHARES
AND THEIR TRANSFER

SECTION 7.1 CERTIFICATES FOR SHARES. Certificates
representing shares of the corporation shall be signed by the chairman of the
board of directors, if any, or the president or a vice president and by the
treasurer or an assistant treasurer or the secretary or an assistant secretary
and may be sealed with the seal, or a facsimile of seal, of the corporation.
If a certificate is countersigned by a transfer agent or a registrar, other
than the corporation itself or its employee, any other signatures or
countersignature on the certificate may be facsimile.

If the corporation is authorized and does issue shares of more
than one class, every certificate representing shares issued by the corporation
shall set forth on the face or back of the certificate a full summary or
statement of all of the designations, preferences, qualifications, limitations,
restrictions, and special or relative rights of the shares of each class
authorized to be issued. If the corporation is authorized to issue any
preferred or special class in series, every certificate representing such
shares issued by the corporation shall set forth on the face or back of the
certificate a full summary or statement of all of the variations in the
relative rights and preferences between the shares of each such series so far
as the same have been fixed and determined and the authority of the board of
directors to fix and determine the relative rights and preferences of
subsequent series. Such statement may be omitted from the certificate if it
shall be set forth upon the face or back of the certificate that such
statement, in full, will be furnished by the corporation to any shareholder
upon request and without charge.

Each certificate representing shares shall also state that the
corporation is organized under the laws of the State of Illinois; the name of
the person to whom issued; the number and class of shares and the designation
of the series, if any, which such certificate represents; the par value of each
share represented by such certificate, or a statement that such shares are
without par value. Each certificate representing shares shall be consecutively
numbered or otherwise identified.

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The name and address of each shareholder, the number and class
of shares held and the date on which the certificates for shares were issued
shall be entered on the books of the corporation. The person in whose name
shares stand on the books of the corporation shall be deemed the owner thereof
for all purposes as regards the corporation. No certificate shall be issued
for any share until such share is fully paid.

SECTION 7.2 LOST CERTIFICATES. If a certificate
representing shares of the corporation is alleged to have been lost, stolen or
destroyed, the board of directors may in its discretion, except as may be
required by law, direct that a new certificate be issued. In connection with
the issuance of any such new certificate, the may require the owner of the
lost, stolen or destroyed certificate or his or her legal representative to
provide such indemnification, and may impose such other reasonable
requirements, as the shall deem necessary or desirable.

SECTION 7.3 TRANSFERS OF SHARES. Upon surrender to
the corporation or the transfer agent of the corporation of a certificate
representing shares duly endorsed or accompanied by proper evidence of
succession, assignment or authority to transfer, a new certificate shall be
issued to the person entitled thereto, and the old certificate shall be
cancelled and the transaction recorded upon the books of the corporation.

ARTICLE VIII

FISCAL YEAR

The fiscal year of the corporation shall begin on January 1
and end on December 31 of each year.

ARTICLE IX

DIVIDENDS

The board of directors may from time to time declare, and the
corporation may pay, dividends on its outstanding and treasury shares in such
manner and upon such terms and conditions as provided by law and the articles
of incorporation.

ARTICLE X

SEAL

The corporate seal, if any, shall have inscribed thereon the
name of the corporation and the words "Corporate Seal, Illinois." The seal may
be used by causing it or a facsimile thereof to be impressed or affixed or in
any manner reproduced.

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ARTICLE XI

WAIVER OF NOTICE

Whenever any notice is required to be given under these
by-laws or under the provisions of the articles of incorporation or under the
provisions of the BCA, a waiver thereof in writing, signed by the person or
persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the giving of such notice.

ARTICLE XII

AMENDMENTS

The power to make, alter, amend, or repeal the by-laws of the
corporation shall be vested in the board of directors. The By- Laws shall be
amended, from time to time, exclusively by a resolution adopted by a majority
of the board of directors. The by-laws may contain any provisions for the
regulation and management of the affairs of the corporation not inconsistent
with law or the articles of incorporation.

ARTICLE XIII

REPAYMENT OF DISALLOWED REIMBURSEMENTS
OR EXCESS COMPENSATION

Any payments made to a director, officer or employee of the
corporation, including but not limited to, salary, commission, bonus, interest,
rent, travel, or entertainment expense incurred by such director, officer or
employee, which shall be disallowed in whole or in part as a deductible expense
by the Internal Revenue Service, shall be reimbursed by such person to the
corporation to the full extent of such disallowance.

It shall be the duty of the board of directors to enforce
payment of all such amounts disallowed. In lieu of payment by such person,
subject to the determination of the board of directors, proportional amounts
may be withheld from the future compensation payments of such person until the
amount owed to the corporation has been recovered.

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EXHIBIT D

FORM OF AFFILIATE REPRESENTATIONS AND COVENANTS

In connection with the above transactions, I represent and warrant to
the Resulting Corporation and agree that:

A. I will not make any sale, transfer or other disposition of the
shares of the Resulting Corporation ("Resulting Corporation Stock") in
violation of the Securities Act of 1933, as amended ("Act"), or the rules and
regulations thereunder (the "Rules and Regulations").

B. I have no present plan or intent to dispose of the Resulting
Corporation Stock acquired by me pursuant to the Reorganization and I have not
formulated prior to the date hereof any such plan or intent to dispose of the
Resulting Corporation Stock.

C. I have been advised that the offering, sale and delivery of
the shares of the Resulting Corporation Stock to me pursuant to the
Reorganization will be registered under the Act on a Registration Statement on
Form S-4. I have also been advised, however, that, since I may be deemed to
have been an Affiliate of a Constituent Corporation at the time the Agreement
was submitted for a vote of the shareholders of such Constituent Corporation,
the shares of Resulting Corporation Stock acquired by me pursuant to the
Reorganization must be held by me indefinitely unless (i) such shares of
Resulting Corporation Stock have been registered for distribution under the
Act, (ii) a sale of the shares of Resulting Corporation Stock is made in
conformity with the volume and other limitations of Rule 145, or (iii) in the
opinion of counsel acceptable to Resulting Corporation, some other exemption
from registration under the Act is available with respect to any such proposed
sale, transfer or other disposition.

D. I have carefully read this letter agreement and the Agreement
and have discussed their requirements and other applicable limitations upon my
ability to sell, transfer or otherwise dispose of the shares of Resulting
Corporation Stock, to the extent I felt necessary, with my counsel or with
Vedder, Price, Kaufman & Kammholz.

E. I understand that the Resulting Corporation is under no
obligation to register the sale, transfer or other disposition of the shares of
Resulting Corporation Stock for sale, transfer or other disposition by me or to
take any other action necessary for the purpose of making an exemption from
registration available.

F. I understand that stop transfer instructions will be given to
Resulting Corporation's transfer agent(s) and/or registrar(s) and that there
will be placed on the certificates representing the shares of Resulting
Corporation Stock I receive in the Reorganization, or any substitutions
therefor, a legend stating in substance:

"The securities represented by this certificate were issued in
a transaction (the reorganization of Resulting Corporation) to
which

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Rule 145 promulgated under the Securities Act of 1933, as amended (the
"Act"), applies and may be sold or otherwise transferred only in
compliance with the limitations of such Rule 145, upon receipt by
Resulting Corporation of an opinion of counsel acceptable to it that
some other exemption from registration under the Act is available, or
pursuant to a registration statement under the Act. The securities
represented by this certificate may not be sold or otherwise
transferred prior to the publication by Resulting Corporation of an
earnings statement covering at least 30 days of operations subsequent
to [insert effective date of the Reorganization]."

G. I hereby agree that, for a period of two (2) years following
the effective date of the Reorganization, I will obtain an agreement similar to
this agreement from each transferee of the shares of Resulting Corporation
Stock sold or otherwise transferred by me, but only if such transfer is
effected other than in a transaction involving a registered public offering or
as a sale pursuant to Rule 145.

H. Notwithstanding the other provisions hereof, I agree not to
sell, pledge, transfer, or otherwise dispose of the shares of Resulting
Corporation Stock, or reduce my risk relative to the Resulting Corporation
Stock in any other way, from the date hereof until such time as financial
results covering at least 30 days of combined operations of the parties to the
Reorganization have been published within the meaning of Section 201.01 of the
Securities and Exchange Commission's Codification of Financial Reporting
Policies (SEC "pooling" requirement). I have not reduced my risk relative to
the Resulting Corporation Stock to date.

It is understood and agreed that this letter agreement will terminate
and be of no further force and effect and the legend set forth in Paragraph F
above will be removed by delivery of substitute certificates without such
legend, and the related transfer restrictions shall be lifted forthwith, if the
period of time specified in Paragraph H of this letter agreement has passed and
(i) my shares of Resulting Corporation Stock shall have been registered under
the Act for sale, transfer or other disposition by me or on my behalf, (ii) I
am not at the time an Affiliate of Resulting Corporation and have held the
shares of Resulting Corporation Stock for at least two (2) years (or such other
period as may be prescribed by the Act and the Rules and Regulations) and
Resulting Corporation has filed with the Securities and Exchange Commission
(the "Commission") all of the reports it is required to file under the
Securities Exchange Act of 1934, as amended, during the preceding twelve (12)
months, (iii) I am not and have not been for at least three (3) months an
Affiliate of Resulting Corporation and I have held the shares of Resulting
Corporation Stock for at least three (3) years, or (iv) Resulting Corporation
shall have received a letter from the staff of the Commission, or an opinion of
counsel acceptable to Resulting Corporation, to the effect that the stock
transfer restrictions and the legend are no longer required.

*In the event this undertaking covers shares held jointly or held individually
by related parties who will sign this together, each joint or related party
shall sign.

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APPENDIX B

May 14, 1996

Board of Directors
North Shore Community Bancorp, Inc.
1145 Wilmette Avenue
Wilmette, Illinois 60091

Members of the Board:

You have requested our opinion as to the fairness, from a financial
point of view, of the exchange ratio for shareholders of North Shore Community
Bancorp, Inc. ("North Shore") with respect to the proposed reorganization (the
"Reorganization") of North Shore, Lake Forest Bancorp, Inc., Hinsdale Bancorp,
Inc., Libertyville Bancorp, Inc. and Crabtree Capital Corporation (collectively
referred to herein as the "Companies"), pursuant to the Agreement and Plan of
Reorganization dated as of May 28, 1996, by and among the Companies, Lake
forest Bancorp II, Hinsdale Bancorp II, Libertyville Bancorp II, and Crabtree
Capital Corporation II (the "Reorganization Agreement").

Pursuant to the Reorganization Agreement, each issued and outstanding
share of North Shore Common Stock, without par value, shall be adjusted by
means of a stock split (the "Stock Split") to represent 5.16180 shares of
Wintrust Financial Corporation Common Stock, without par value, ("Wintrust
Common Stock") (the "Exchange Ratio"). All issued and outstanding warrants,
rights and options to purchase shares of North Shore Common Stock will remain
issued and outstanding and be unaffected by the Reorganization, except that
such warrants, rights and options will be adjusted to give effect to the Stock
Split. The terms of the Reorganization are more fully set forth in the
Reorganization Agreement.

In arriving at the opinion set forth below, we have, among other
things:

1. Reviewed each of the Companies' audited financial statements
and related financial information for the two fiscal years ended December 31,
1995 (where available), unaudited financial information for the three months
ended March 31, 1996, as well as other internally generated reports relating to
asset/liability management, asset quality, and so forth;

2. Reviewed and analyzed certain other information bearing upon
the financial and operating condition of each of the Companies, and materials
prepared by management in connection with the proposed transaction;

3. Conducted discussions with members of the senior management of
each of the Companies concerning the financial condition, businesses, assets,
earnings, and prospects of each, and such senior management's views as to the
future financial performance of each;

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4. Reviewed certain financial forecasts and projections of each
of Companies as prepared by the management of each;

5. Reviewed the offering documents for each of the Companies
(where applicable) used in connection with the capitalization of each;

6. Reviewed the recent stock prices and historical trading
activity for the shares of Common Stock each of the Companies;

7. Reviewed the Reorganization Agreement and all of the related
agreements; and

8. Reviewed such other financial studies and analyses and
performed such other investigations and took into account such other matters as
we deemed necessary for purposes of rendering this opinion.

We have assumed and relied, without independent verification, upon the
accuracy and completeness of all of the financial and other information
reviewed by us for the purposes of this opinion. We have also assumed and
relied upon the senior management of each of the Companies as to the
reasonableness and achievability of the financial and operating forecasts (and
the assumptions and bases therefor) provided to us. In that regard, we have
assumed with your permission that such forecasts reflect the best currently
available estimates and judgment of such management and that such forecasts
will be realized in the amounts and in the time periods currently estimated by
the management of each of the Companies. We are not experts in the evaluation
of allowances for loan losses, and we have not made an independent evaluation
of the adequacy of the allowance for loan losses of each of the Companies, nor
have we reviewed any individual loan credit files and we have assumed that the
aggregate allowance for loan losses are adequate to cover such losses. In
addition, we have not made an independent evaluation or appraisal of the assets
and liabilities of each of the Companies nor any of their subsidiaries, nor
were we furnished with any such evaluation or appraisal. Our opinion is
necessarily based on economic, market, and other conditions as in effect on,
and the information made available to us as of, the date hereof.

Howe Barnes Investments, Inc., as part of its investment banking
business, is regularly engaged in the valuation of banks and bank holding
companies, thrifts and thrift holding companies, and various other financial
services companies, in connection with mergers and acquisitions, initial and
secondary offerings of securities, and valuations for other purposes. In
rendering this fairness opinion we have acted on behalf of the Board of
Directors of North Shore, and, with their consent, also acted in the same
capacity for the other Companies, and will receive a fee for our services from
each.

Our opinion as expressed herein is limited to the fairness, from a
financial point of view, of the Exchange Ratio to the holders of North Shore
Common Stock and does not address North Shore's underlying business decision to
proceed with the Reorganization. We have been retained on behalf of the Board
of Directors of North Shore, and our opinion does not constitute a

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recommendation to any holder of North Shore Common Stock as to how such holder
should vote with respect to the Reorganization Agreement at any meeting of
holders of North Shore Common Stock.

Based on the foregoing and our experience as investment bankers, we
are of the opinion that, as of the date hereof, the Exchange Ratio proposed for
the shareholders of North Shore as described in the Reorganization Agreement,
is fair from a financial point of view.

Sincerely,

HOWE BARNES INVESTMENTS, INC.

By MICHAEL E. SAMMON
-------------------------------
Michael E. Sammon
Senior Vice President

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346

May 15, 1996

Board of Directors
Lake Forest Bancorp, Inc.
727 N. Bank Lane
Lake Forest, Illinois 60045

Members of the Board:

You have requested our opinion as to the fairness, from a financial
point of view, of the exchange ratio for shareholders of Lake Forest Bancorp,
Inc. ("Lake Forest") with respect to the proposed reorganization (the
"Reorganization") of North Shore Community Bancorp, Inc., Lake Forest, Hinsdale
Bancorp, Inc., Libertyville Bancorp, Inc. and Crabtree Capital Corporation
(collectively referred to herein as the "Companies"), pursuant to the Agreement
and Plan of Reorganization dated as of May 28, 1996, by and among the
Companies, Lake Forest Bancorp II, Hinsdale Bancorp II, Libertyville Bancorp
II, and Crabtree Capital Corporation II (the "Reorganization Agreement").

Pursuant to the Reorganization Agreement, each issued and outstanding
share of Lake Forest Common Stock, without par value, shall be converted into
the right to receive 9.67334 shares of Common Stock, without par value, of
Wintrust Financial Corporation ("Wintrust Common Stock") (the "Exchange
Ratio"). All issued and outstanding rights and options to purchase shares of
Lake Forest Common Stock will automatically convert to rights and options to
purchase shares of Wintrust Common Stock at a fixed conversion ratio equal to
the Exchange Ratio established for Lake Forest Common Stock. The terms of the
Reorganization are more fully set forth in the Reorganization Agreement.

In arriving at the opinion set forth below, we have, among other
things:

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347

4. Reviewed certain financial forecasts and projections of each
of the Companies as prepared by the management of each;

5. Reviewed the offering documents for each of the Companies
(where applicable) used in connection with the capitalization of each;

6. Reviewed the recent stock prices and historical trading
activity for the shares of Common Stock of each of the Companies;

7. Reviewed the Reorganization Agreement and all of the related
agreements; and

8. Reviewed such other financial studies and analyses and
performed such other investigations and took into account such other matters as
we deemed necessary for purposes of rendering this opinion.

Howe Barnes Investments, Inc., as part of its investment banking
business, is regularly engaged in the valuation of banks and bank holding
companies, thrifts and thrift holding companies, and various other financial
services companies, in connection with mergers and acquisitions, initial and
secondary offerings of securities, and valuations for other purposes. In
rendering this fairness opinion we have acted on behalf of the Board of
Directors of Lake Forest, and, with their consent, also acted in the same
capacity for the other Companies, and will receive a fee for our services from
each.

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348

Our opinion as expressed herein is limited to the fairness, from a
financial point of view, of the Exchange Ratio to the holders of Lake Forest
Common Stock and does not address Lake Forest's underlying business decision to
proceed with the Reorganization. We have been retained on behalf of the Board
of Directors of Lake Forest, and our opinion does not constitute a
recommendation to any holder of Lake Forest Common Stock as to how such holder
should vote with respect to the Reorganization Agreement at any meeting of
holders of Lake Forest Common Stock.

Based on the foregoing and our experience as investment bankers, we
are of the opinion that, as of the date hereof, the Exchange Ratio proposed for
the shareholders of Lake Forest as described in the Reorganization Agreement,
is fair from a financial point of view.

Sincerely,

HOWE BARNES INVESTMENTS, INC.

By MICHAEL E. SAMMON
-------------------------------
Michael E. Sammon
Senior Vice President

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May 14, 1996

Board of Directors
Hinsdale Bancorp, Inc.
25 East First Street
Hinsdale, Illinois 60521

Members of the Board:

You have requested our opinion as to the fairness, from a financial
point of view, of the exchange ratio for shareholders of Hinsdale Bancorp, Inc.
("Hinsdale") with respect to the proposed reorganization (the "Reorganization")
of North Shore Bancorp, Inc., Lake Forest Bancorp, Inc., Hinsdale, Libertyville
Bancorp, Inc. and Crabtree Capital Corporation (collectively referred to herein
as the "Companies"), pursuant to the Agreement and Plan of Reorganization dated
as of May 28, 1996, by and among the Companies, Lake Forest Bancorp II,
Hinsdale Bancorp II, Libertyville Bancorp II, and Crabtree Capital Corporation
II (the "Reorganization Agreement").

Pursuant to the Reorganization Agreement, each issued and outstanding
share of Hinsdale Common Stock, without par value, shall be converted into the
right to receive 6.03398 shares of Common Stock, without par value, of Wintrust
Financial Corporation ("Wintrust Common Stock") (the "Exchange Ratio"). All
issued and outstanding rights and options to purchase shares of Hinsdale Common
Stock will automatically convert to rights and options to purchase shares of
Wintrust Common Stock at a fixed conversion ratio equal to the Exchange Ratio
established for Hinsdale Common Stock. All issued and outstanding warrants to
purchase shares of Hinsdale Common Stock will remain issued and outstanding and
will be unaffected by the Reorganization. The terms of the Reorganization are
more fully set forth in the Reorganization Agreement.

In arriving at the opinion set forth below, we have, among other
things:

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350

4. Reviewed certain financial forecasts and projections of each
of the Companies as prepared by the management of each;

5. Reviewed the offering documents for each of the Companies
(where applicable) used in connection with the capitalization of each;

6. Reviewed the recent stock prices and historical trading
activity for the shares of Common Stock of each of the Companies;

7. Reviewed the Reorganization Agreement and all of the related
agreements; and

8. Reviewed such other financial studies and analyses and
performed such other investigations and took into account such other matters as
we deemed necessary for purposes of rendering this opinion.

We have assumed and relied, without independent verification, upon the
accuracy and completeness of all of the financial and other information
reviewed by us for the purposes of this opinion. We have also assumed and
relied upon the senior management of each of the Companies as to the
reasonableness and achievability of the financial and operating forecasts (and
the assumptions and bases therefor) provided to us. In that regard, we have
assumed with your permission that such forecasts reflect the best currently
available estimates and judgment of such management and that such forecasts
will be realized in the amounts and in the time periods currently estimated by
the management of each of the Companies. We are not experts in the evaluation
of allowances for loan losses, and we have not made an independent evaluation
of the adequacy of the allowance for loan losses of each of the Companies, nor
have we reviewed any individual loan credit files and we have assumed that the
aggregate allowance for loan losses are adequate to cover such losses. In
addition, we have not made an independent evaluation or appraisal of the assets
and liabilities of each of the Companies, nor any of their subsidiaries, nor
were we furnished with any such evaluation or appraisal. Our opinion is
necessarily based on economic, market, and other conditions as in effect on,
and the information made available to us as of, the date hereof.

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351

rendering this fairness opinion we have acted on behalf of the Board of
Directors of Hinsdale, and, with their consent, also acted in the same capacity
for the other Companies, and will receive a fee for our services from each.

Our opinion as expressed herein is limited to the fairness, from a
financial point of view, of the Exchange Ratio to the holders of Hinsdale
Common Stock and does not address Hinsdale's underlying business decision to
proceed with the Reorganization. We have been retained on behalf of the Board
of Directors of Hinsdale, and our opinion does not constitute a recommendation
to any holder of Hinsdale Common Stock as to how such holder should vote with
respect to the Reorganization Agreement at any meeting of holders of Hinsdale
Common Stock.

Based on the foregoing and our experience as investment bankers, we
are of the opinion that, as of the date hereof, the Exchange Ratio proposed for
the shareholders of Hinsdale as described in the Reorganization Agreement, is
fair from a financial point of view.

Sincerely,

HOWE BARNES INVESTMENTS, INC.

By MICHAEL E. SAMMON
-------------------------------
Michael E. Sammon
Senior Vice President

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May 15, 1996

Board of Directors
Libertyville Bancorp, Inc.
507 N. Milwaukee Avenue
Libertyville, Illinois 60048

Members of the Board:

You have requested our opinion as to the fairness, from a financial
point of view, of the exchange ratio for shareholders of Libertyville Bancorp,
Inc. ("Libertyville") with respect to the proposed reorganization (the
"Reorganization") of North Shore Bancorp, Inc., Lake Forest Bancorp, Inc.,
Hinsdale Bancorp, Inc., Libertyville and Crabtree Capital Corporation
(collectively referred to herein as the "Companies"), pursuant to the Agreement
and Plan of Reorganization dated as of May 28, 1996, by and among the
Companies, Lake Forest Bancorp II, Hinsdale Bancorp II, Libertyville Bancorp
II, and Crabtree Capital Corporation II (the "Reorganization Agreement").

Pursuant to the Reorganization Agreement, each issued and outstanding
share of Libertyville Common Stock, without par value, shall be converted into
the right to receive 4.02578 shares of Common Stock, without par value, of
Wintrust Financial Corporation ("Wintrust Common Stock") (the "Exchange
Ratio"). All issued and outstanding rights and options to purchase shares of
Libertyville Common Stock will automatically convert to rights and options to
purchase shares of Wintrust Common Stock at a fixed conversion ratio equal to
the Exchange Ratio established for Libertyville Common Stock. All issued and
outstanding warrants to purchase shares of Libertyville Common Stock will
remain issued and outstanding and will be unaffected by the Reorganization.
The terms of the Reorganization are more fully set forth in the Reorganization
Agreement.

In arriving at the opinion set forth below, we have, among other
things:

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353

4. Reviewed certain financial forecasts and projections of each
of the Companies as prepared by the management of each;

5. Reviewed the offering documents for each of the Companies
(where applicable) used in connection with the capitalization of each;

6. Reviewed the recent stock prices and historical trading
activity for the shares of Common Stock of each of the Companies;

7. Reviewed the Reorganization Agreement and all of the related
agreements; and

8. Reviewed such other financial studies and analyses and
performed such other investigations and took into account such other matters as
we deemed necessary for purposes of rendering this opinion.

We have assumed and relied, without independent verification, upon the
accuracy and completeness of all of the financial and other information
reviewed by us for the purposes of this opinion. We have also assumed and
relied upon the senior management of each of the Companies as to the
reasonableness and achievability of the financial and operating forecasts (and
the assumptions and bases therefor) provided to us. In that regard, we have
assumed with your permission that such forecasts reflect the best currently
available estimates and judgment of such management and that such forecasts
will be realized in the amounts and in the time periods currently estimated by
the management of each of the Companies. We are not experts in the evaluation
of allowances for loan losses, and we have not made an independent evaluation
of the adequacy of the allowance for loan losses of each of the Companies, nor
have we reviewed any individual loan credit files and we have assumed that the
aggregate allowance for loan losses are adequate to cover such losses. In
addition, we have not made an independent evaluation or appraisal of the assets
and liabilities of each of the Companies, nor any of their subsidiaries, nor
were we furnished with any such evaluation or appraisal. Our opinion is
necessarily based on economic, market, and other conditions as in effect on,
and the information made available to us as of, the date hereof.

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354

rendering this fairness opinion we have acted on behalf of the Board of
Directors of Libertyville, and, with their consent, also acted in the same
capacity for the other Companies, and will receive a fee for our services from
each.

Our opinion as expressed herein is limited to the fairness, from a
financial point of view, of the Exchange Ratio to the holders of Libertyville
Common Stock and does not address Libertyville's underlying business decision
to proceed with the Reorganization. We have been retained on behalf of the
Board of Directors of Libertyville, and our opinion does not constitute a
recommendation to any holder of Libertyville Common Stock as to how such holder
should vote with respect to the Reorganization Agreement at any meeting of
holders of Libertyville Common Stock.

Based on the foregoing and our experience as investment bankers, we
are of the opinion that, as of the date hereof, the Exchange Ratio proposed for
the shareholders of Libertyville as described in the Reorganization Agreement,
is fair from a financial point of view.

Sincerely,

HOWE BARNES INVESTMENTS, INC.

By MICHAEL E. SAMMON
-------------------------------
Michael E. Sammon
Senior Vice President

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May 13, 1996

Board of Directors
Crabtree Capital Corporation
475 N. Martingale Rd., Suite 440
Schaumburg, Illinois 60173

Members of the Board:

You have requested our opinion as to the fairness, from a financial
point of view, of the exchange ratio for shareholders of Crabtree Capital
Corporation ("Crabtree") with respect to the proposed reorganization (the
"Reorganization") of North Shore Community Bancorp, Inc., Lake Forest Bancorp,
Inc., Hinsdale Bancorp, Inc., Libertyville Bancorp, Inc. and Crabtree
(collectively referred to herein as the "Companies"), pursuant to the Agreement
and Plan of Reorganization dated as of May 28, 1996, by and among the
Companies, Lake Forest Bancorp II, Hinsdale Bancorp II, Libertyville Bancorp
II, and Crabtree Capital Corporation II (the "Reorganization Agreement").

Pursuant to the Reorganization Agreement, each issued and outstanding
share of Crabtree Common Stock, without par value, shall be converted into the
right to receive 1.18332 shares of Common Stock, without par value, of Wintrust
Financial Corporation ("Wintrust Common Stock") (the "Exchange Ratio"). All
issued and outstanding rights and options to purchase shares of Crabtree Common
Stock will automatically convert to rights and options to purchase shares of
Wintrust Common Stock at a fixed conversion ratio equal to the Exchange Ratio
established for Crabtree Common Stock. The terms of the Reorganization are
more fully set forth in the Reorganization Agreement.

In arriving at the opinion set forth below, we have, among other
things:

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4. Reviewed certain financial forecasts and projections of each
of the Companies as prepared by the management of each;

5. Reviewed the offering documents for each of the Companies
(where applicable) used in connection with the capitalization of each;

6. Reviewed the recent stock prices and historical trading
activity for the shares of Common Stock of each of the Companies;

7. Reviewed the Reorganization Agreement and all of the related
agreements; and

8. Reviewed such other financial studies and analyses and
performed such other investigations and took into account such other matters as
we deemed necessary for purposes of rendering this opinion.

We have assumed and relied, without independent verification, upon the
accuracy and completeness of all of the financial and other information
reviewed by us for the purposes of this opinion. We have also assumed and
relied upon the senior management of each of the Companies as to the
reasonableness and achievability of the financial and operating forecasts (and
the assumptions and bases therefor) provided to us. In that regard, we have
assumed with your permission that such forecasts reflect the best currently
available estimates and judgment of such management and that such forecasts
will be realized in the amounts and in the time periods currently estimated by
the management of each of the Companies. We are not experts in the evaluation
of allowances for loan losses, and we have not made an independent evaluation
of the adequacy of the allowance for loan losses of each of the Companies, nor
have we reviewed any individual loan credit files and we have assumed that the
aggregate allowance for loan losses are adequate to cover such losses. In
addition, we have not made an independent evaluation or appraisal of the assets
and liabilities of each of the Companies, nor any of their subsidiaries, nor
were we furnished with any such evaluation or appraisal. Our opinion is
necessarily based on economic, market, and other conditions as in effect on,
and the information made available to us as of, the date hereof.

Howe Barnes Investments, Inc., as part of its investment banking
business, is regularly engaged in the valuation of banks and bank holding
companies, thrifts and thrift holding companies, and various other financial
services companies, in connection with mergers and acquisitions, initial and
secondary offerings of securities, and valuations for other purposes. In
rendering this fairness opinion we have acted on behalf of the Board of
Directors of Crabtree, and, with their consent, also acted in the same capacity
for the other Companies, and will receive a fee for our services from each.

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Our opinion as expressed herein is limited to the fairness, from a
financial point of view, of the Exchange Ratio to the holders of Crabtree
Common Stock and does not address Crabtree's underlying business decision to
proceed with the Reorganization. We have been retained on behalf of the Board
of Directors of Crabtree, and our opinion does not constitute a recommendation
to any holder of Crabtree Common Stock as to how such holder should vote with
respect to the Reorganization Agreement at any meeting of holders of Crabtree
Common Stock.

Based on the foregoing and our experience as investment bankers, we
are of the opinion that, as of the date hereof, the Exchange Ratio proposed for
the shareholders of Crabtree as described in the Reorganization Agreement, is
fair from a financial point of view.

Sincerely,

HOWE BARNES INVESTMENTS, INC.

By: MICHAEL E. SAMMON
-------------------------------
Michael E. Sammon
Senior Vice President

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APPENDIX C -- SECTIONS 11.65 AND 11.70 OF
THE ILLINOIS BUSINESS CORPORATION ACT

ILLINOIS BUSINESS CORPORATION ACT

5/11.65 RIGHT TO DISSENT -- (a) A shareholder of a corporation is entitled to
dissent from, and obtain payment for his or her shares in the event of any of
the following corporate actions:

(1) consummation of a plan of merger or consolidation or a plan of
share exchange to which the corporation is a party if (i) shareholder
authorization is required for the merger or consolidation of the share
exchange by Section 11.20 or the articles of incorporation or (ii) the
corporation is a subsidiary that is merged with its parent or another
subsidiary under Section 11.30;

(2) consummation of a sale, lease or exchange of all, or
substantially all, of the property and assets of the corporation other
than in the usual and regular course of business;

(3) an amendment of the articles of incorporation that materially
and adversely affects rights in respect of a dissenter's shares
because it:

(i) alters or abolishes a preferential right of such
shares;

(ii) alters or abolishes a right in respect of redemption,
including a provision respecting a sinking fund for the redemption
or repurchase, of such shares;

(iii) in the case of a corporation incorporated prior to
January 1, 1982, limits or eliminates cumulative voting rights
with respect to such shares; or

(4) any other corporate action taken pursuant to a shareholder
vote if the articles of incorporation, by laws, or a resolution of the
board of directors provide that shareholders are entitled to dissent
and obtain payment for their shares in accordance with the procedures
set forth in Section 11.70 or as may be otherwise provided in the
articles, by-laws or resolution.

(b) A shareholder entitled to dissent and obtain payment for his or
her shares under this Section may not challenge the corporate action creating
his or her entitlement unless the action is fraudulent with respect to the
shareholder or the corporation or constitutes a breach of a fiduciary duty owed
to the shareholder.

(c) A record owner of shares may assert dissenters' rights as to fewer
than all the shares recorded in such person's name only if such person dissents
with respect to all shares beneficially owned by any one person and notifies
the corporation in writing of the name and address of each person on whose
behalf the record owner asserts dissenters' rights. The rights of a partial
dissenter are determined as if the shares as to which dissent is made and the
other shares are recorded in the names of different shareholders. A beneficial
owner of shares who is not the record owner may assert dissenters' rights as to
shares held on such person's behalf only if the beneficial owner submits to the
corporation the record owner's written consent to the dissent before or at the
same time the beneficial owner asserts dissenters' rights. (Last amended by
P.A. 85-1269, L.'88, eff. 1-1-89.)
____________________________
.1 RIGHTS OF DISSENTING SHAREHOLDERS. -- Court can use evidence of
book value and previous arm's-length transactions in valuing stock of closely
held corporation for minority holders dissenting to merger. Stewart v. DJ
Stewart & Co, 346 NE2d 475 (App Ct 1976).
Surviving had to offer stockholders of dissolved corporation market
value of their stock at time of merger, when stockholders were deprived of
their statutory appraisal rights as result of deceptive proxy statement.
Swanson v. American Consumers Industries Inc., 475 F2d 516 (7th Cir 1973).

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Under statute allowing corporations to petition court to determine
"fair value" of stock, valuation calls for exercise of judgment after
consideration of all relevant factors; the minority or illiquid nature of stock
may be relevant to its intrinsic worth. Independence Tube Corp v Levine, 535
NE2d 927 (App Ct 1989).

.2 OBJECTING STOCKHOLDER. -- The term "objecting stockholder" should
not receive a literal and narrow construction. It means any stockholder in a
corporation who, for any reason, preferred to take the fair value of his stock
in the corporation in which he held the stock rather than accept other stock in
the acquiring corporation. Though the objecting stockholder voted for the
original resolution for consolidation, and for the similar resolution adopted
by the stockholders at their first meeting, he was not estopped from claiming
that he was an objecting stockholder. The objecting stockholder had the right
at any time before the adoption of the final resolution for the consolidation
to register his objection thereto. Ahlenius v Bunn & Humphreys, Inc, 182 NE
738 (App Ct 1932), valuation set aside by 192 NE 824 (1934).

PROCEDURE TO DISSENT -- (a) If the corporate action giving rise to the
right to dissent is to be approved at a meeting of shareholders, the notice of
meeting shall inform the shareholders of their right to dissent and the
procedure to dissent. If, prior to the meeting, the corporation furnishes to
the shareholders material information with respect to the transaction that will
objectively enable a shareholder to vote on the transaction and to determine
whether or not to exercise dissenters' rights, a shareholder may assert
dissenters' rights only if the shareholder delivers to the corporation before
the vote is taken a written demand for payment for his or her shares if the
proposed action is consummated, and the shareholder does not vote in favor of
the proposed action.

(b) If the corporate action giving rise to the right to dissent is not
to be approved at a meeting of shareholders, the notice to shareholders
describing the action taken under Section 11.30 or Section 7.10 shall inform
the shareholders of their right to dissent and the procedure to dissent. If,
prior to or concurrently with the notice, the corporation furnishes to the
shareholders material information with respect to the transaction that will
objectively enable a shareholder to determine whether or not to exercise
dissenters' rights, a shareholder may assert dissenter's rights only if he or
she delivers to the corporation within 30 days from the date of mailing the
notice a written demand for payment for his or her shares.

(c) Within 10 days after the date on which the corporate action giving
rise to the right to dissent is effective or 30 days after the shareholder
delivers to the corporation the written demand for payment, whichever is later,
the corporation shall send each shareholder who has delivered a written demand
for payment a statement setting forth the opinion of the corporation as to the
estimated fair value of the shares, the corporation's latest balance sheet as
of the end of a fiscal year ending not earlier than 16 months before the
delivery of the statement, together with the statement of income for that year
and the latest available interim financial statements, and either a commitment
to pay for the shares of the dissenting shareholder at the estimated fair value
thereof upon transmittal to the corporation of the certificate or certificates,
or other evidence of ownership, with respect to the shares, or instructions to
the dissenting shareholder to sell his or her shares within 10 days after
delivery of the corporation's statement to the shareholder. The corporation
may instruct the shareholder to sell only if there is a public market for the
shares at which the shares may be readily sold. If the shareholder does not
sell within that 10 day period after being so instructed by the corporation,
for purposes of this Section the shareholder shall be deemed to have sold his
or her shares at the average closing price of the shares, if listed on a
national exchange, or the average of the bid and asked price with respect to
the shares quoted by a principal market maker, if not listed on a national
exchange, during that 10 day period.

(d) A shareholder who makes written demand for payment under this
Section retains all other rights of a shareholder until those rights are
canceled or modified by the consummation of the proposed corporate action.
Upon consummation of that action, the corporation shall pay to each dissenter
who transmits to the corporation the certificate or other evidence of ownership
of the shares the amount the corporation estimates to be the fair value of the
shares, plus accrued interest, accompanied by a written explanation of how the
interest was calculated.

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(e) If the shareholder does not agree with the opinion of the
corporation as to the estimated fair value of the shares or the amount of
interest due, the shareholder, within 30 days from the delivery of the
corporation's statement of value, shall notify the corporation in writing of
the shareholder's estimated fair value and the amount of interest due and
demand payment for the difference between the shareholder's estimate of fair
value and interest due and the amount of the payment by the corporation or the
proceeds of sale by the shareholder, whichever is applicable because of the
procedure for which the corporation opted pursuant to subsection (c).

(f) If, within 60 days from delivery to the corporation of the
shareholder notification of estimate of fair value of the shares and interest
due, the corporation and the dissenting shareholder have not agreed in writing
upon the fair value of the shares and interest due, the corporation shall
either pay the difference in value demanded by the shareholder, with interest,
or file a petition in the circuit court of the county in which either the
registered office or the principal office of the corporation is located,
requesting the court to determine the fair value of the shares and interest
due. The corporation shall make all dissenters, whether or not residents of
this State, whose demands remain unsettled parties to the proceeding as an
action against their shares and all parties shall be served with a copy of the
petition. Non residents may be served by registered or certified mail or by
publication as provided by law. Failure of the corporation to commence an
action pursuant to this Section shall not limit or affect the right of the
dissenting shareholders to otherwise commence an action as permitted by law.

(g) The jurisdiction of the court in which the proceeding is commenced
under subsection (f) by a corporation is plenary and exclusive. The court may
appoint one of more persons as appraisers to receive evidence and recommend
decision on the question of fair value. The appraisers have the power
described in the order appointing them, or in any amendment to it.

(h) Each dissenter made a party to the proceeding is entitled to
judgment for the amount, if any, by which the court finds that the fair value
of his or her shares, plus interest, exceeds to amount paid by the corporation
or the proceeds of sale by the shareholder, whichever amount is applicable.

(i) The court, in a proceeding commenced under subsection (f), shall
determine all costs of the proceeding, including the reasonable compensation
and expenses of the appraisers, if any, appointed by the court under subsection
(g), but shall exclude the fees and expenses of counsel and experts for the
respective parties. If the fair value of the shares as determined by the court
materially exceeds the amount which the corporation estimated to be the fair
value of the shares or if no estimate was made in accordance with subsection
(c), then all or any part of the costs may be assessed against the corporation.
If the amount which any dissenter estimated to be the fair value of the shares
materially exceeds the fair value of the shares as determined by the court,
then all or any part of the costs may be assessed against that dissenter. The
court may also assess the fees and expenses of counsel and experts for the
respective parties, in amounts the court finds equitable, as follows:

(1) Against the corporation and in favor of any or all dissenters
if the court finds that the corporation did not substantially comply
with the requirements of subsections (a), (b), (c), (d), or (f).

(2) Against either the corporation or as a dissenter and in favor
of any other party if the court finds that the party against whom the
fees and expenses are assessed acted arbitrarily, vexatiously, or not
in good faith with respect to the rights provided by this Section.

If the court finds that the services of counsel for any dissenter
were of substantial benefit to other dissenters similarly situated and
that the fees for those services should not be assessed against the
corporation, the court may award to that counsel reasonable fees to be
paid out of the amounts awarded to the dissenters who are benefited.
Except as otherwise provided in this Section, the practice, procedure,
judgment and costs shall be governed by the Code of Civil Procedure.

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(j) As used in this Section:

(1) "Fair valuer," with respect to a dissenter's shares, means the
value of the shares immediately before the consummation of the
corporate action to which the dissenter objects excluding any
appreciation or depreciation in anticipation of the corporate action,
unless exclusion would be inequitable.

(2) "Interest" means interest from the effective date of the
corporate action until the date of payment, at the average rate
currently paid by the corporation on its principal bank loans or, if
none, at a rate that is fair and equitable under all the
circumstances. (Last amended by P.A. 86-1156, L. '90, eff. 8-10-90.)

_______________
.1 VALUATION OF STOCK. -- If stockholders dissenting from a sale of
assets seek a court's determination of the fair market value of their stock,
they are bound by the court's findings and cannot dismiss the suit and resume
their status as stockholders. Bauman v Advance Aluminum Castings Corp, 169
NE2d 382 (App Ct 1960).
Under statute allowing corporations to petition court to determine
"fair value" of stock, valuation calls for exercise of judgment after
consideration of all relevant factors; the minority or illiquid nature of stock
may be relevant to its intrinsic worth. Independence Tube Corp v Levine, 535
NE2d 927 (App Ct 1989).

.2 EFFECT OF FAILURE TO MAKE STATUTORY DEMAND IN TIME. - Dissenting
shareholder not in position to complain that sale of corporation's only
property was made improperly because shareholder failed for more than 20 days
after the vote of the shareholders authorizing the sale to make the demand
required by this section. Morris v Columbia Apartments Corp, 55 NE2d 401
(1944).

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APPENDIX D -- SECTION 262 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE

Section 262. APPRAISAL RIGHTS.

(a) Any stockholder of a corporation of this State who holds shares of stock
on the date of the making of a demand pursuant to subsection (d) of this
section with respect to such shares, who continuously holds such shares through
the effective date of the merger or consolidation, who has otherwise complied
with subsection (d) of this section and who has neither voted in favor of the
merger or consolidation nor consented thereto in writing pursuant to Section
228 of this title shall be entitled to an appraisal by the Court of Chancery of
the fair value of his shares of stock under the circumstances described in
subsections (b) and (c) of this section. As used in this section, the word
"stockholder" means a holder of record of stock in a stock corporation and also
a member of record of a nonstock corporation; the words "stock" and "share"
mean and include what is ordinarily meant by those words and also membership or
membership interest of a member of a nonstock corporation; and the words
"depository receipt" mean a receipt or other instrument issued by a depository
representing an interest in one or more shares, or fractions thereof, solely of
stock of a corporation, which stock is deposited with the depository.

(b) Appraisal rights shall be available for the shares of any class or series
of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to Section Section 251, 252, 254, 257, 258, 263 or 264 of
this title:

(1) Provided, however, that no appraisal rights under this section shall
be available for the shares of any class or series of stock, which stock, or
depository receipts in respect thereof, at the record date fixed to determine
the stockholders entitled to receive notice of and to vote at the meeting of
stockholders to act upon the agreement of merger or consolidation, were
either (i) listed on a national securities exchange or designated as a
national market system security on an interdealer quotation system by the
National Association of Securities Dealers, Inc. or (ii) held of record by
more than 2,000 holders; and further provided that no appraisal rights shall
be available for any shares of stock of the constituent corporation surviving
a merger if the merger did not require for its approval the vote of the
holders of the surviving corporation as provided in subsections (f) or (g) of
Section 251 of this title.

(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the shares of any class or series
of stock of a constituent corporation if the holders thereof are required by
the terms of an agreement of merger or consolidation pursuant to Section
Section 251, 252, 254, 257, 258, 263 and 264 of this title to accept for such
stock anything except:

Shares of stock of the corporation surviving or resulting from such
merger or consolidation;

Shares of stock of the corporation surviving or resulting from such
merger or consolidation, or depository receipts in respect thereof;

Shares of stock of any other corporation, or depository receipts in
respect thereof, which shares of stock or depository receipts at the
effective date of the merger or consolidation will be either listed on a
national securities exchange or designated as a national market system
security on an interdealer quotation system by the National Association of
Securities Dealers, Inc. or held of record by more than 2,000 holders;

Cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a. and b. of this paragraph; or

Any combination of the shares of stock, depository receipts and cash in
lieu of fractional shares or fractional depository receipts described in the
foregoing subparagraphs a., b. and c. of this paragraph.

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(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under Section 253 of this title is not owned by
the parent corporation immediately prior to the merger, appraisal rights
shall be available for the shares of the subsidiary Delaware corporation.

(c) Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets
of the corporation. If the certificate of incorporation contains such a
provision, the procedures of this section, including those set forth in
subsections (d) and (e) of this section, shall apply as nearly as is
practicable.

(d) Appraisal rights shall be perfected as follows:

(1) If a proposed merger or consolidation for which appraisal rights are
provided under this section is to be submitted for approval at a meeting of
stockholders, the corporation, not less than 20 days prior to the meeting,
shall notify each of its stockholders who was such on the record date for
such meeting with respect to shares for which appraisal rights are available
pursuant to subsections (b) or (c) hereof that appraisal rights are available
for any or all of the shares of the constituent corporations, and shall
include in such notice a copy of this section. Each stockholder electing to
demand the appraisal of his shares shall deliver to the corporation before
the taking of the vote on the merger or consolidation, a written demand for
appraisal of his shares. Such demand will be sufficient if it reasonably
informs the corporation of the identity of the stockholder and that the
stockholder intends thereby to demand the appraisal of his shares. A proxy or
vote against the merger or consolidation shall not constitute such a demand.
A stockholder electing to take such action must do so by a separate written
demand as herein provided. Within 10 days after the effective date of such
merger or consolidation, the surviving or resulting corporation shall notify
each stockholder of each constituent corporation who has complied with this
subsection and has not voted in favor of or consented to the merger or
consolidation of the date that the merger or consolidation has become
effective; or

(2) If the merger or consolidation was approved pursuant to Section 228 or
Section 253 of this title, the surviving or resulting corporation, either
before the effective date of the merger or consolidation or within 10 days
thereafter, shall notify each of the stockholders entitled to appraisal
rights of the effective date of the merger or consolidation and that
appraisal rights are available for any or all of the shares of the
constituent corporation, and shall include in such notice a copy of this
section. The notice shall be sent by certified or registered mail, return
receipt requested, addressed to the stockholder at his address as it appears
on the records of the corporation. Any stockholder entitled to appraisal
rights may, within 20 days after the date of mailing of the notice, demand in
writing from the surviving or resulting corporation the appraisal of his
shares. Such demand will be sufficient if it reasonably informs the
corporation of the identity of the stockholder and that the stockholder
intends thereby to demand the appraisal of his shares.

(e) Within 120 days after the effective date of the merger or consolidation,
the surviving or resulting corporation or any stockholder who has complied with
subsections (a) and (d) hereof and who is otherwise entitled to appraisal
rights, may file a petition in the Court of Chancery demanding a determination
of the value of the stock of all such stockholders. Notwithstanding the
foregoing, at any time within 60 days after the effective date of the merger or
consolidation, any stockholder shall have the right to withdraw his demand for
appraisal and to accept the terms offered upon the merger or consolidation.
Within 120 days after the effective date of the merger or consolidation, any
stockholder who has complied with the requirements of subsections (a) and (d)
hereof, upon written request, shall be entitled to receive from the corporation
surviving the merger or resulting from the consolidation a statement setting
forth the aggregate number of shares not voted in favor of the merger or
consolidation and with respect to which demands for appraisal have been
received and the aggregate number of holders of such shares. Such written
statement shall be mailed to the stockholder within 10 days after his written
request for such a statement is received by the surviving or resulting
corporation or within 10 days after expiration of the period for delivery of
demands for appraisal under subsection (d) hereof, whichever is later.

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(f) Upon the filing of any such petition by a stockholder, service of a copy
thereof shall be made upon the surviving or resulting corporation, which shall
within 20 days after such service file in the office of the Register in
Chancery in which the petition was filed a duly verified list containing the
names and addresses of all stockholders who have demanded payment for their
shares and with whom agreements as to the value of their shares have not been
reached by the surviving or resulting corporation. If the petition shall be
filed by the surviving or resulting corporation, the petition shall be
accompanied by such a duly verified list. The Register in Chancery, if so
ordered by the Court, shall give notice of the time and place fixed for the
hearing of such petition by registered or certified mail to the surviving or
resulting corporation and to the stockholders shown on the list at the
addresses therein stated. Such notice shall also be given by 1 or more
publications at least 1 week before the day of the hearing, in a newspaper of
general circulation published in the city of Wilmington, Delaware or such
publication as the Court deems advisable. The forms of the notices by mail and
by publication shall be approved by the Court, and the costs thereof shall be
borne by the surviving or resulting corporation.

(g) At the hearing on such petition, the Court shall determine the
stockholders who have complied with this section and who have become entitled
to appraisal rights. The Court may require the stockholders who have demanded
an appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings; and if any stockholder
fails to comply with such direction, the Court may dismiss the proceedings as
to such stockholder.

(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any
element of value arising from the accomplishment or expectation of the merger
or consolidation, together with a fair rate of interest, if any, to be paid
upon the amount determined to be the fair value. In determining such fair
value, the Court shall take into account all relevant factors. In determining
the fair rate of interest, the Court may consider all relevant factors,
including the rate of interest which the surviving or resulting corporation
would have had to pay to borrow money during the pendency of the proceeding.
Upon application by the surviving or resulting corporation or by any
stockholder entitled to participate in the appraisal proceeding, the Court may,
in its discretion, permit discovery or other pretrial proceedings and may
proceed to trial upon the appraisal prior to the final determination of the
stockholder entitled to an appraisal. Any stockholder whose name appears on
the list filed by the surviving or resulting corporation pursuant to subsection
(f) of this section and who has submitted his certificates of stock to the
Register in Chancery, if such is required, may participate fully in all
proceedings until it is finally determined that he is not entitled to appraisal
rights under this section.

(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to
the stockholders entitled thereto. Interest may be simple or compound, as the
Court may direct. Payment shall be so made to each such stockholder, in the
case of holders of uncertified stock forthwith, and the case of holders of
shares represented by certificates upon the surrender to the corporation of the
certificates representing such stock. The Court's decree may be enforced as
other decrees in the Court of Chancery may be enforced, whether such surviving
or resulting corporation be a corporation of this State or of any state.

(j) The costs of the proceeding may be determined by the Court and taxed upon
the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.

(k) From and after the effective date of the merger or consolidation, no
stockholder who has demanded his appraisal rights as provided in subsection (d)
of this section shall be entitled to vote such stock for any purpose or to
receive payment of dividends or other distributions on the stock (except
dividends or other distributions payable to stockholders of record at a date
which is prior to the effective date of the merger or consolidation); provided,
however, that if no petition for an appraisal shall be filed within the time
provided in subsection (e) of this section, or if such stockholder shall
deliver to the surviving or resulting corporation a written withdrawal of his
demand for

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an appraisal and an acceptance of the merger or consolidation, either within 60
days after the effective date of the merger or consolidation as provided in
subsection (e) of this section or thereafter with the written approval of the
corporation, then the right of such stockholder to an appraisal shall cease.
Notwithstanding the foregoing, no appraisal proceeding in the Court of Chancery
shall be dismissed as to any stockholder without the approval of the Court, and
such approval may be conditioned upon such terms as the Court deems just.

(l) The shares of the surviving or resulting corporation to which the shares
of such objecting stockholders would have been converted had they assented to
the merger or consolidation shall have the status of authorized and unissued
shares of the surviving or resulting corporation. (Last amended by Ch. 79, L.
'95, eff. 7-1-95.)

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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

In accordance with the Illinois Business Corporation Act (being Chapter 805,
Act 5 of the Illinois Compiled Statutes), Articles Eight and Nine of the
Registrant's Certificate of Incorporation provide as follows:

**ARTICLE EIGHT: No director of the corporation shall be liable to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director except for liability (a) for any breach of the director's
duty of loyalty to the corporation or its shareholders, (b) for acts or
omissions not in good faith or that involve intentional misconduct of a knowing
violation of law, (c) under Section 8.65 of the BCA, as the same exists or
hereafter may be amended, or (d) for any transaction from which the director
derived an improper personal benefit.

**ARTICLE NINE, PARAGRAPH 1: The corporation shall indemnify, to the full
extent that it shall have power under applicable law to do so and in a manner
permitted by such law, any person made or threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he or she
is or was a director, officer, employee or agent of the corporation, or who is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against liabilities and expenses reasonably incurred or paid
by such person in connection with such action, suit or proceeding. The
corporation may indemnify, to the full extent that it shall have power under
applicable law to do so and in a manner permitted by such law, any person made
or threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or she is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
liabilities and expenses reasonably incurred or paid by such person in
connection with such action, suit or proceeding. The words "liabilities" and
"expenses" shall include, without limitation: liabilities, losses, damages,
judgments, fines, penalties, amounts paid in settlement, expenses, attorneys'
fees and costs. Expenses incurred in defending a civil, criminal,
administrative, investigative or other action, suit or proceeding may be paid
by the corporation in advance of the final disposition of such action, suit or
proceeding in accordance with the provisions of Section 8.75 of the BCA.

The indemnification and advancement of expenses provided by this Article
shall not be deemed exclusive of any other rights to which any person
indemnified may be entitled under any statute, by-law, agreement, vote of
shareholders, or disinterested directors or otherwise, both as to action in his
official capacity and as to action in any other capacity while holding such
office, and shall continue as to a person who has ceased to be such director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person.

PARAGRAPH 2: The corporation may purchase and maintain insurance on behalf
of any person referred to in the preceding paragraph against any liability
asserted against him or her and incurred by him or her in any such capacity, or
arising out of his or her status as such, whether or not the corporation would
have the power to indemnify him or her against such liability under the
provisions of this Article or otherwise.

PARAGRAPH 3: For purposes of this Article, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, employees or
agents, so that any person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall stand
in the same position under the provisions of this Article with respect to the
resulting or surviving

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corporation as he or she would have with respect to such constituent
corporation if its separate existence had continued.

PARAGRAPH 4: The provisions of this Article shall be deemed to be a
contract between the corporation and each director or officer who serves in any
such capacity at any time while this Article and the relevant provisions of the
BCA, or other applicable law, if any, are in effect, and any repeal or
modification of any such law or of this Article shall not affect any rights or
obligations then existing with respect to any state of facts then or
theretofore existing or any action, suit or proceeding theretofore or
thereafter brought or threatened based in whole or in part upon any such state
of facts.

PARAGRAPH 5: For purposes of this Article, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to any employee benefit plan;
and references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee or
agent with respect to any employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner he or she
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner not
opposed to the best interests of the corporation.

The Illinois Business Corporation Act provides for indemnification of
officers, directors, employees and agents as follows:

5/8.75 INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS;
INSURANCE. (a) A corporation may indemnify any person who was or is a party,
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he or she is or was a director, officer, employee or
agent of the corporation, or who is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding, if such person acted in good faith and in a manner he or
she reasonably believed to be in, or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement, conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create a presumption that the person did not act in good faith and in a manner
which he or she reasonably believed to be in or not opposed to the best
interests of the corporation or, with respect to any criminal action or
proceeding, that the person had reasonable cause to believe that his or her
conduct was unlawful.

(b) A corporation may indemnify any person who was or is a party, or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor
by reason of the fact that such person is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by such person in
connection with the defense or settlement of such action or suit, if such
person acted in good faith and in a manner he or she reasonably believed to be
in, or not opposed to, the best interests of the corporation, provided that no
indemnification shall be made with respect to any claim, issue, or matter as to
which such person, has been adjudged to have been liable to the corporation,
unless, and only to the extent that the court in which such action or suit was
brought shall determine upon application that, despite the adjudication of
liability, but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses as the court
shall deem proper.

(c) To the extent that a director, officer, employee or agent of a
corporation has been successful, on the merits or otherwise, in the defense of
any action, suit or proceeding referred to in subsections (a) and (b), or

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in defense of any claim, issue or matter therein, such person shall be
indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith.

(d) Any indemnification under subsections (a) and (b) (unless ordered by a
court) shall be made by the corporation only as authorized in the specific
case, upon a determination that indemnification of the director, officer,
employee or agent is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in subsections (a) or (b). Such
determination shall be made (1) by the board of directors by a majority vote of
a quorum consisting of directors who were not parties to such action, suit or
proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable,
if a quorum of disinterested directors so directs, by independent legal counsel
in a written opinion, or (3) by the shareholders.

(e) Expenses incurred in defending a civil or criminal action, suit or
proceeding may be paid by the corporation in advance of the final disposition
of such action, suit or proceeding upon receipt of an undertaking by or on
behalf of the director, officer, employee or agent to repay such amount if it
shall ultimately be determined that he or she is not entitled to be indemnified
by the corporation as authorized in this Section.

(f) The indemnification and advancement of expenses provided by or granted
under the other subsections of this Section shall not be deemed exclusive of
any other rights to which those seeking indemnification or advancement of
expenses may be entitled under any by-law, agreement, vote of shareholders or
disinterested directors, or otherwise, both as to action in his or her official
capacity and as to action in another capacity while holding such office.

(g) A corporation may purchase and maintain insurance on behalf of any person
who is or was a director, officer, employee or agent of the corporation, or who
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against any liability asserted against such person and
incurred by such person in any such capacity, or arising out of his or her
status as such, whether or not the corporation would have the power to
indemnify such person against such liability under the provisions of this
Section.

(h) If a corporation has paid indemnity or has advanced expenses to a
director, officer, employee or agent, the corporation shall report the
indemnification or advance in writing to the shareholders with or before the
notice of the next shareholders meeting.

(i) For purposes of this Section, references to "the corporation" shall
include, in addition to the surviving corporation, any merging corporation
(including any corporation having merged with a merging corporation) absorbed
in a merger which, if its separate existence had continued, would have had the
power and authority to indemnify its directors, officers, and employees or
agents, so that any person who was a director, officer, employee or agent of
such merging corporation, or was serving at the request of such merging
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under the provisions of this Section with respect to the surviving
corporation as such person would have with respect to such merging corporation
if its separate existence had continued.

(j) For purposes of this Section, reference to "other enterprises" shall
include employee benefit plans; references to "fines" shall include any excise
taxes assessed on a person with respect to an employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by such director, officer, employee, or
agent with respect to an employee benefit plan, its participants, or
beneficiaries. A person who acted in good faith and in a manner he or she
reasonably believed to be in the best interests of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interest of the corporation" as referred to in
this Section.

(k) The indemnification and advancement of expenses provided by or granted
under this Section shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a director,

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officer, employee, or agent and shall inure to the benefit of the heirs,
executors, and administrators of that person. (Last amended by P.A. 88-43, L.
'93, eff. 1-1-94.)

ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

The exhibits filed as a part of this Registration Statement are as follows:

- List of Exhibits (filed herewith unless otherwise noted)

2.1 Agreement and Plan of Reorganization among North Shore Community
Bancorp, Inc., Lake Forest Bancorp II, Hinsdale Bancorp II,
Libertyville Bancorp II, Crabtree Capital Corporation II and Lake
Forest Bancorp, Inc., Hinsdale Bancorp, Inc., Libertyville Bancorp,
Inc. and Crabtree Capital Corporation dated as of May 15, 1996
(filed herewith as Appendix A to the Joint Proxy Statement/Prospectus)
3.1 Articles of Incorporation of North Shore Community Bancorp, Inc.
3.2 By-laws of North Shore Community Bancorp, Inc.
3.3 Proposed Articles of Incorporation of Wintrust Financial Corporation
(included as Exhibit B in Appendix A to the Joint Proxy
Statement/Prospectus)
3.4 Proposed By-Laws of Wintrust Financial Corporation (included as
Exhibit B in Appendix A to the Joint Proxy Statement/Prospectus)
5.1 Form of Opinion of Vedder, Price, Kaufman & Kammholz re: legality*
8.1 Opinion of Blackman Kallick Bartelstein LLP as to federal income tax
matters
10.1 Hinsdale Bancorp, Inc. 1993 Stock Option Plan
10.2 Form of Series A Warrant Agreement relating to the right to purchase
shares of Hinsdale Bancorp, Inc.
10.3 Form of Series B Warrant Agreement relating to the right to purchase
shares of Hinsdale Bancorp, Inc.*
10.4 Lake Forest Bancorp, Inc. 1991 Stock Option Plan
10.5 Lake Forest Bancorp, Inc. 1993 Stock Option Plan
10.6 Lake Forest Bank & Trust Company Lease for drive-up facility located at
the corner of Bank Lane & Wisconsin Avenue, Lake Forest, Illinois,
dated December 11, 1992*
10.7 Lake Forest Bank & Trust Company Lease for banking facility located at
810 South Waukegan Road, Lake Forest, Illinois
10.8 Lake Forest Bank & Trust Company Lease for banking facility located at
666 North Western Avenue, Lake Forest, Illinois, dated July 19, 1991
and Amendment
10.9 Lake Forest Bank & Trust Company Lease for banking facility located at
103 East Scranton Avenue, Lake Bluff, Illinois, dated November 1, 1994
10.10 Phantom Stock Agreement between Lake Forest Bancorp, Inc. and Edward
J. Wehmer
10.11 Libertyville Bancorp, Inc. 1995 Stock Option Plan
10.12 Form of Series A Warrant Agreement relating to the right to purchase
shares of Libertyville Bancorp, Inc.
10.13 Form of Series B Warrant Agreement relating to the right to purchase
shares of Libertyville Bancorp, Inc.
10.14 Phantom Stock Agreement between Libertyville Bancorp, Inc. and Edward
J. Wehmer
10.15 North Shore Community Bancorp, Inc. 1993 Stock Rights Plan
10.16 North Shore Community Bancorp, Inc. 1994 Stock Options Plan
10.17 Form of Warrant Agreement relating to the right to purchase shares of
North Shore Community Bancorp, Inc.
10.18 North Shore Bank & Trust Company Lease for banking facility located at
362 Park Avenue, Glencoe, Illinois, dated July 27, 1995
10.19 North Shore Community Bancorp, Inc. Lease for banking facility located
at 794 Oak Street, Winnetka, Illinois, dated June 16, 1995

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10.20 Phantom Stock Agreement between North Shore Community Bancorp, Inc.
and Anne M. Adams
10.21 Crabtree Capital Corporation 1987 Stock Option Plan
10.22 Crabtree Capital Corporation 1990 Stock Purchase Plan
10.23 Warrant Purchase Agreement between First Premium Services, Inc. and
Internationale Nederlande (U.S.) Finance Corporation dated as of
December 30, 1992, and Amendment Dated as of February 12, 1993
10.24 Warrant Purchase Agreement between First Premium Services, Inc. and
Internationale Nederlande (U.S.) Finance Corporation, dated as of
February 12, 1993
10.25 Warrant Purchase Agreement between First Premium Services, Inc. and
Deerpath Investment Partners, Ltd., dated as of December 23, 1992, and
related documents
10.26 Crabtree Capital Corporation Lease for property located at 425
Martingale Road, Suite 1540, Schaumburg, Illinois, dated February 13,
1995
10.27 The Credit Life Companies, Incorporated 1987 Stock Option Plan
10.28 First Premium Services, Inc. 1992 Stock Option Plan
23.1 Consents of KPMG Peat Marwick LLP
23.2 Consent of Howe Barnes Investments, Inc.
23.3 Consent of Arthur Andersen LLP
23.4 Consent of Vedder, Price, Kaufman & Kammholz (included in Exhibit 5.1)
23.5 Consent of Blackman Kallick Bartelstein LLP (included in Exhibit 8.1)
24.1 Powers of Attorney (set forth on Signature pages)
27.1 Financial Data Schedules
99.1 Form of Proxy for North Shore Community Bancorp, Inc.
99.2 Form of Proxy for Lake Forest Bancorp, Inc.
99.3 Form of Proxy for Hinsdale Bancorp, Inc.
99.4 Form of Proxy for Libertyville Bancorp, Inc.
99.5 Form of Proxy for Crabtree Capital Corporation
99.6 Opinions of Howe Barnes Investments, Inc. with respect to fairness of
the transaction from a financial point of view (included in Appendix B
to the Joint Proxy Statement/Prospectus)
99.7 Consent of Nominee Alan W. Adams
99.8 Consent of Nominee Peter Crist
99.9 Consent of Nominee Eugene Hotchkiss III
99.10 Consent of Nominee James Knollenberg
99.11 Consent of Nominee John S. Lillard
99.12 Consent of Nominee James Mahoney
99.13 Consent of Nominee James B. McCarthy
99.14 Consent of Nominee Tull Monsees
99.15 Consent of Nominee Albin Moschner
99.16 Consent of Nominee J. Christopher Reyes
99.17 Consent of Nominee John Schaper
99.18 Consent of Nominee Jane Stein
99.19 Consent of Nominee Katherine Sylvester
99.20 Consent of Nominee Larry Wright

* To be filed by Amendment.

- FINANCIAL STATEMENT SCHEDULES

All schedules have been omitted as not applicable or not required under the
rules of Regulation S-X.

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ITEM 22. UNDERTAKINGS

- To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement.

- To include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933.

- To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the Registration Statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.

- To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement.

- That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

- To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of
the offering.

The Registrant hereby undertakes to supply by means of a post-effective
amendment all information concerning a transaction, and the company being
acquired involved therein, that was not the subject of and included in the
Registration Statement when it became effective.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to Item 20 of this Registration Statement, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the State of Illinois, on May 28,
1996.

NORTH SHORE COMMUNITY BANCORP, INC.
(name to be changed to Wintrust
Financial Corporation)

By: EDWARD J. WEHMER
---------------------------------
Edward J. Wehmer, Vice Chairman

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Lemuel H. Tate, Howard D. Adams, Edward
J. Wehmer or David A. Dykstra, or any of them, his true and lawful
attorneys-in-fact and agents, with full power of substitution and
re-substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and all other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully for all intents and purposes as he
might or could do in person, hereby ratifying and confirming any and all such
acts said attorneys-in-fact and agents or their substitutes or substitute may
lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

Name Title Date

LEMUEL H. TATE Chairman and Director May 28, 1996
- ------------------------------
Lemuel H. Tate

EDWARD J. WEHMER Vice Chairman and Director May 28, 1996
- ------------------------------
Edward J. Wehmer

HOWARD D. ADAMS Vice Chairman and Director May 28, 1996
- ------------------------------
Howard D. Adams

DAVID A. DYKSTRA Chief Financial Officer May 28, 1996
- ------------------------------ (and principal accounting officer)
David A. Dykstra

JOHN W. CLOSE President, Chief Executive Officer May 28, 1996
- ----------------------------- and director
John W. Close

GILBERT BOWEN Director May 28, 1996
- -----------------------------
Gilbert Bowen

JOSEPH DEVIVO, JR. Director May 28, 1996
- -----------------------------
Joseph DeVivo, Jr.

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373

MAURICE F. DUNNE, JR. Director May 28, 1996
- -------------------------------
Maurice F. Dunne, Jr.

GAYLE INBINDER Director May 28, 1996
- -------------------------------
Gayle Inbinder

THOMAS MCCABE Director May 28, 1996
- -------------------------------
Thomas McCabe

MARGUERITE SAVARD MCKENNA Director May 28, 1996
- -------------------------------
Marguerite Savard McKenna

DONALD L. OLSON Director May 28, 1996
- -------------------------------
Donald L. Olson

HOLLIS RADEMACHER Director May 28, 1996
- -------------------------------
Hollis Rademacher

JOHN J. SCHORNACK Director May 28, 1996
- -------------------------------
John J. Schornack

INGRID STAFFORD Director May 28, 1996
- -------------------------------
Ingrid Stafford

STANLEY WEINBERGER Director May 28, 1996
- -------------------------------
Stanley Weinberger

ELIZABETH WARREN Director May 28, 1996
- -------------------------------
Elizabeth Warren

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EXHIBIT INDEX

Sequentially
Exhibit Numbered Page
- ------- -------------

2.1 Agreement and Plan of Reorganization by and among North Shore
Community Bancorp, Inc., Lake Forest Bancorp, Inc., Hinsdale Bancorp,
Inc., Libertyville Bancorp, Inc. and Crabtree Capital Corporation
dated as of May 15, 1996 (filed herewith as Appendix A to the Joint
Proxy Statement/Prospectus..............................................

3.1 Articles of Incorporation of North Shore Community Bancorp, Inc. .......

3.2 By-laws of North Shore Community Bancorp, Inc. ..........................

3.3 Proposed Articles of Incorporation of Wintrust Financial Corporation
(included in Appendix A to the Joint Proxy Statement/Prospectus) .......

3.4 Proposed By-laws of Wintrust Financial Corporation (included in
Appendix A to the Joint Proxy Statement/Prospectus) ....................

5.1 Form of Opinion of Vedder, Price, Kaufman & Kammholz re: legality*......

8.1 Opinion of Blackman Kallick Bartelstein, LLP as to federal income tax
matters ................................................................

10.1 Hinsdale Bancorp, Inc. 1993 Stock Option Plan ..........................

10.2 Form of Series A Warrant Agreement relating to
the right to purchase shares of Hinsdale Bancorp, Inc. .................

10.3 Form of Series B Warrant Agreement relating to the right to
purchase shares of Hinsdale Bancorp, Inc.*..............................

10.4 Lake Forest Bancorp, Inc. 1991 Stock Option Plan .......................

10.5 Lake Forest Bancorp, Inc. 1993 Stock Option Plan .......................

10.6 Lake Forest Bank & Trust Co. Lease for drive-up facility
located at the corner of Bank Lane and Wisconsin Avenue, Lake Forest,
Illinois, dated December 11, 1992*......................................

10.7 Lake Forest Bank & Trust Co. Lease for banking facility located
at 810 South Waukegan Road, Lake Forest, Illinois ......................

10.8 Lake Forest Bank & Trust Co. Lease for banking facility,
located at 666 North Western Avenue, Lake Forest, Illinois,
dated July 19, 1991 ....................................................

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375

10.9 Lake Forest Bank & Trust Co. Lease for banking facility
located at 103 East Scranton Avenue, Lake Bluff, Illinois,
dated November 1, 1994 .................................................

10.10 Phantom Stock Agreement between Lake Forest Bancorp, Inc.
and Edward J. Wehmer ...................................................

10.11 Libertyville Bancorp, Inc. 1995 Stock Option Plan ......................

10.12 Form of Series A Warrant Agreement relating to the right
to purchase shares of Libertyville Bancorp, Inc. .......................

10.13 Form of Series B Warrant Agreement relating to the right
to purchase shares of Libertyville Bancorp, Inc. .......................

10.14 Phantom Stock Agreement between Libertyville Bancorp, Inc.
and Edward J. Wehmer ...................................................

10.15 North Shore Community Bancorp, Inc. 1993 Stock Rights Plan .............

10.16 North Shore Community Bancorp, Inc. 1994 Stock Options Plan ............

10.17 Form of Warrant Agreement relating to the right to purchase shares
of North Shore Community Bancorp, Inc. .................................

10.18 North Shore Bank & Trust Company Lease for banking facility located
at 362 Park Avenue, Glencoe, Illinois, dated July 27, 1995 .............

10.19 North Shore Community Bancorp, Inc. Lease for banking facility
located at 794 Oak Street, Winnetka, Illinois, dated June 16, 1995 .....

10.20 Phantom Stock Agreement between North Shore Community Bancorp, Inc.
and Anne M. Adams ......................................................

10.21 Crabtree Capital Corporation 1987 Stock Option Plan ....................

10.22 Crabtree Capital Corporation 1990 Stock Purchase Plan ..................

10.23 Warrant Purchase Agreement between First Premium Services, Inc. and
Internationale Nederlande (U.S.) Finance Corporation dated as of
December 30, 1992, and Amendment Dated as of February 12, 1993 .........

10.24 Warrant Purchase Agreement between First Premium Services, Inc. and
Internationale Nederlande (U.S.) Finance Corporation, dated as of
February 12, 1993 ......................................................

10.25 Warrant Purchase Agreement between First Premium Services, Inc. and
Deerpath Investment Partners, Ltd., dated as of December 23, 1992,
and related documents ..................................................

10.26 Crabtree Capital Corporation Lease for property located at 425
Martingale Road, Suite 1540, Schaumburg, Illinois, dated February 13,
1995 ...................................................................

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10.27 The Credit Life Companies, Incorporated 1987 Stock Option Plan ...........

10.28 First Premium Services, Inc. 1992 Stock Option Plan ......................

23.1 Consent of KPMG Peat Marwick LLP .........................................

23.2 Consent of Howe Barnes Investments, Inc. .................................

23.3 Consent of Arthur Andersen LLP ...........................................

23.4 Consent of Vedder, Price, Kaufman & Kammholz (included in Exhibit 5.1) ...

23.5 Consent of Blackman Kallick Bartelstein, LLP (included in Exhibit 8.1) ...

24.1 Powers of Attorney (set forth on Signature pages) ........................

27.1 Financial Data Schedules .................................................

99.1 Form of Proxy for North Shore Community Bancorp, Inc. ....................

99.2 Form of Proxy for Lake Forest Bancorp, Inc. ..............................

99.3 Form of Proxy for Hinsdale Bancorp, Inc. .................................

99.4 Form of Proxy for Libertyville Bancorp, Inc. .............................

99.5 Form of Proxy for Crabtree Capital Corporation ...........................

99.6 Opinions of Howe Barnes Investments, Inc. with respect to fairness
of the transaction from a financial point of view (included in
Appendix B to the Joint Proxy Statement/Prospectus) ......................

99.7 Consent of Nominee Alan W. Adams .........................................

99.8 Consent of Nominee Peter Crist ...........................................

99.9 Consent of Nominee Eugene Hotchkiss III ..................................

99.10 Consent of Nominee James Knollenberg .....................................

99.11 Consent of Nominee John S. Lillard .......................................

99.12 Consent of Nominee James Mahoney .........................................

99.13 Consent of Nominee James B. McCarthy .....................................

99.14 Consent of Nominee Tull Monsees ..........................................

99.15 Consent of Nominee Albin Moschner ........................................

99.16 Consent of Nominee J. Christopher Reyes ..................................

99.17 Consent of Nominee John Schaper ..........................................

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377

99.18 Consent of Nominee Jane Stein ..........................................

99.19 Consent of Nominee Katherine Sylvester .................................

99.20 Consent of Nominee Larry Wright ........................................

*To be filed by Amendment.

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