10-K

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-K

(Mark One)

x Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 [Fee required]

for the fiscal year ended December 31, 2004

or

¨ Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 [No fee Required]

for the transition period from                      to                     

Commission file number 0-15261.

BRYN MAWR BANK CORPORATION

(Exact name of registrant as specified in its charter)

Pennsylvania	23-2434506
(State of other jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)
801 Lancaster Avenue, Bryn Mawr, Pennsylvania	19010
(Address of principal executive offices)	(Zip Code)

(Registrant’s telephone number, including area code) (610) 525-1700

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
NONE	NONE

Securities registered pursuant to Section 12(g) of the Act:

Common Stock ($1 par value)

(Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 of 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period than the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x     No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (& 229 405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Act) Yes x     No ¨

The aggregate market value of shares of common stock held by non-affiliates of Registrant (including fiduciary accounts administered by affiliates*) was $190,770,000 on June 30, 2004.

As of December 31, 2004, 8,597,958 shares of common stock were outstanding.

Documents Incorporated by Reference: Parts I, II and IV - Portions of Registrant’s Annual Report to Shareholders for the year ended December 31, 2004, as indicated, Parts I and III - Definitive Proxy Statement of Registrant filed with the Commission pursuant to Regulation 14A.

* Registrant does not admit by virtue of the foregoing that its officers and directors are “affiliates” as defined in Rule 405 and does not admit that it controls the shares of Registrant’s voting stock held by the Trust Department of its bank subsidiary.

The exhibit index is on pages 63 through 68. There are 259 pages in this report.

Form 10-K

Bryn Mawr Bank Corporation

Index

Item No.		Page
Part I
1.	Business	1
2.	Properties	41
3.	Legal Proceedings	45
4.	Submission of Matters to a Vote of Security Holders	45
Part II
5.	Market for Registrant’s Common Equity and Related Stockholder Matters	46
6.	Selected Financial Data	49
7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	49
7A.	Quantitative and Qualitative Disclosures about Market Risk	49
8.	Financial Statements and Supplementary Data	50
9.	Change in and Disagreements with Accountants on Accounting and Financial Disclosure	50
9A.	Controls and Procedures	51
Part III
10.	Directors and Executive Officers of the Registrant	53
11.	Executive Compensation	59
12.	Security Ownership of Certain Beneficial Owners and Management	60
13.	Certain Relationships and Related Transactions	61
Part IV
14.	Principle Accounting Fees and Services	62
15.	Exhibits, Financial Statement Schedules and Reports on Form 8-K	63

UNLESS OTHERWISE INDICATED, ALL INFORMATION IS AS OF FEBRUARY 24, 2005.

PART I

ITEM 1. BUSINESS

GENERAL

SPECIAL CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

Certain of the statements contained in this report may constitute forward-looking statements for the purposes of the Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended, and may involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of the Bryn Mawr Bank Corporation (the “Corporation”) to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements include statements with respect to the Corporation’s financial goals, business plans, business prospects, credit quality, credit risk, reserve adequacy, liquidity, origination and sale of residential mortgage loans, mortgage servicing rights, the effect of changes in accounting standards, and market and pricing trends loss. The words “expect,” “anticipate,” “intended,” “plan,” “believe,” “seek,” “estimate,” and similar expressions are intended to identify such forward-looking statements. The Corporation’s actual results may differ materially from the results anticipated by the forward-looking statements due to a variety of factors, including without limitation:

• the effect of future economic conditions on the Corporation and its customers, including economic factors which affect consumer confidence in the securities markets, wealth creation, investment and savings patterns, and the Corporation’s interest rate risk exposure and credit risk;

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• changes in the securities markets with respect to the market values of financial assets and the stability of particular securities markets;

• governmental monetary and fiscal policies, as well as legislation and regulatory changes;

• changes in accounting requirements or interpretations;

• the risks of changes in interest rates on the level and composition of deposits, loan demand, and the value of loan collateral and securities, as well as interest rate risk;

• the effects of competition from other commercial banks, thrifts, mortgage companies, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money-market and mutual funds and other institutions operating in the Corporation’s trade market area and elsewhere including institutions operating locally, regionally, nationally and internationally and such competitors offering banking products and services by mail, telephone, computer and the Internet;

• any extraordinary events (such as the September 11, 2001 events, the war on terrorism and the U.S. Government’s response to those events, including the war in Iraq);

• the Corporation’s success in continuing to generate new business in its existing markets, as well as its success in identifying and penetrating targeted markets and generating a profit in those markets in a reasonable time;

• the Corporation’s ability to continue to generate investment results for customers and the ability to continue to develop investment products in a manner that meets customers needs;

• the Corporation’s timely development of competitive new products and services in a changing environment and the acceptance of such products and services by customers;

• the Corporation’s ability to originate and sell residential mortgage loans;

• the accuracy of assumptions underlying the establishment of reserves for loan losses and estimates in the value of collateral, the market value of mortgage servicing rights and various financial assets and liabilities and technological changes being more difficult or expensive than anticipated; and

• the Corporation’s success in managing the risks involved in the foregoing.

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All written or oral forward-looking statements attributed to the Corporation are expressly qualified in their entirety by use of the foregoing cautionary statements. All forward-looking statements included in this Report are based upon information presently available, and the Corporation assumes no obligation to update any forward-looking statements.

BRYN MAWR BANK CORPORATION

The Corporation, hereinafter sometimes referred to as the Registrant, was incorporated under the laws of the Commonwealth of Pennsylvania on August 8, 1986. The Corporation is a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “Act”). On January 2, 1987, under a Plan of Reorganization, the Corporation acquired all of the issued and outstanding shares of The Bryn Mawr Trust Company (the “Bank”), through an exchange of three shares of the Corporation stock for each share of Bank stock issued.

THE BRYN MAWR TRUST COMPANY

The Bank, the principal subsidiary of the Corporation, is a state chartered bank subject to the Pennsylvania Banking Code of 1965, as amended, which was incorporated under the laws of the Commonwealth of Pennsylvania on March 25, 1889. In addition, the Bank is a member of the Federal Reserve System and, therefore, is subject to the laws and regulations, which govern a Federal Reserve member bank. The Bank is engaged in a general commercial and retail banking business, providing basic banking services as well as a full range of wealth management services, including trust services.

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INSURANCE COUNSELLORS OF BRYN MAWR, INC.

Insurance Counsellors of Bryn Mawr, Inc. (“Insurance Counsellors”) was incorporated on December 30, 1997 as a wholly owned subsidiary of the Bank. Insurance Counsellors began operations on February 1, 1998. The staff of Insurance Counsellors sells insurance products, including all facets of casualty, property and allied insurance lines, as well as life insurance, annuities, medical insurance and accident and health insurance for groups and individuals.

BRYN MAWR BROKERAGE CO., INC.

In January 2003, Bryn Mawr Brokerage Co., Inc. (“BM Brokerage”) was made an inactive subsidiary. The Bank continues to offer an array of brokerage related services to the Corporation’s affiliates’ customers, including trading of shares, annuities and mutual funds through a networking agreement with UVEST Financial Services, Inc, a broker-dealer headquartered in Charlotte, North Carolina.

JOSEPH W. ROSKOS & CO., INC.

Joseph W. Roskos & Co., Inc. (“JWR&Co”) was acquired as of January 1, 1999 as a wholly owned subsidiary of the Corporation to offer high quality personalized family business office services to high net worth individuals, including accounting, tax preparation services, consulting and fiduciary support services. During 2003, Corporation management determined that JWR&Co was not attaining its strategic goals and that it would be in the best interest of the Corporation to discontinue offering family business office services through JWR&Co. The Corporation negotiated the sale of

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substantially all of the assets of JWR&Co effective June 30, 2003 to Private Family Office, Inc. (“PFO”) which is owned by the former president of JWR&Co (the “Asset Sale”).

BMT SETTLEMENT SERVICES, INC.

BMT Settlement Services, Inc. (“BMT Settlement”) began operation in February 2002. BMT Settlement is a limited partner in Bryn Mawr Settlement Services, LP (the “Limited Partnership”), with Commonwealth Land Transfer Company, to provide title search and abstract services to Bank customers. Under the terms of the Limited Partnership’s partnership agreement, BMT Settlement receives seventy percent of the profits of the Limited Partnership, after expenses. During 2003 and 2004, the services of the Limited Partnership were used by some mortgage borrowers using the services of BMT Mortgage Company, a division of the Bank, as well as commercial and consumer loan customers of the Bank.

SUMMARY OF SERVICES AND MARKET AREA

The Corporation will, through its subsidiaries, especially the Bank, seek to market its services by providing superior banking services. This includes deposits, lending and wealth management services, as well as other financial services. The other services include insurance sales and services through Insurance Counsellors; brokerage related services through the Bank, and title abstract services through BMT Settlement’s affiliation with the Limited Partnership. The primary market for these services is in portions of Montgomery, Delaware, Chester and Philadelphia counties in southeastern Pennsylvania. The sale of the products and the offering of the services assist in successfully addressing the challenges in the ever-changing competitive financial services market.

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WEBSITE DISCLOSURES

The Corporation makes available, free of charge through its website, its Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonable practical after the reports are electronically filed with the Securities and Exchange Commission (”SEC”). These reports can be obtained by logging onto the Corporation’s website at www.bmtc.com and clicking on Bryn Mawr Bank Corporation’s SEC Filings.

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OPERATIONS

BRYN MAWR BANK CORPORATION

The Corporation had no active staff as of December 31, 2004 and conducted no activities other than those activities through its subsidiaries, the Bank, Insurance Counsellors, and BMT Settlement.

A complete list of directors and executive officers of the Corporation and the Bank, as of February 24, 2005 is incorporated by reference to page 14 of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

THE BRYN MAWR TRUST COMPANY

The Bank is engaged in commercial and retail banking business, providing basic banking services, including the acceptance of demand, time and savings deposits and the making of commercial, real estate and consumer loans and other extensions of credit. The Bank also provides a full range of wealth management services including estate administration, investment advisory services, pension and profit sharing administration and personal financial planning, including tax preparation. As of December 31, 2004, the market value of assets administered by the Bank’s Wealth Management Division was $1,938,000,000.

During 2004 residential mortgage interest rates began to rise and the level of residential mortgage refinancing activity previously reported by the Bank declined. The sale of residential mortgage loans to the secondary market declined by 77%, from $628,052,000 in 2003 to $144,916,000 in 2004. This decrease in the volume of loan sales is directly attributable to a 73%

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decline in gains on the sale of loans and a 71% decrease in the segment profit of the Mortgage Banking segment. As of February 24, 2005, the Bank had no commissioned mortgage originators; however, an incentive plan is in place to encourage the managers and staff of the BMT Mortgage Division to produce revenues.

In March 2004 the Bank entered into a long term lease for property located in Exton, Chester County, Pennsylvania, to build a new full-service branch. This branch is expected to open for business during the first quarter of 2005.

At December 31, 2004, the Bank had 220 full time and 35 part time employees, including 120 officers, equaling 237.5 full time equivalent staff.

INSURANCE COUNSELLORS OF BRYN MAWR, INC.

Insurance Counsellors is a full-service insurance agency, through which the Bank offers insurance and related products and services to its customer base. This includes casualty, property and allied insurance lines, as well as life insurance, annuities, medical insurance and accident and health insurance for groups and individuals.

Insurance Counsellors employs 4 licensed insurance agents and a support staff of 1 full time person, who have significant expertise in the design, sale and service of insurance products. Insurance Counsellors is able to offer insurance products of more than thirty life and health companies for specialized insurance needs. Insurance Counsellors generated $431,000 of revenue during 2004.

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BRYN MAWR BROKERAGE CO., INC.

Effective January 2003, BM Brokerage was made an inactive subsidiary. Since January 2003, the Bank has offered securities products, including mutual funds, annuities, individual stocks and bonds and retirement plans through the Bank’s branch system. The Bank has entered into a networking agreement with UVEST Financial Services, Inc., a broker-dealer headquartered in Charlotte, North Carolina to provide the necessary back office support.

JOSEPH W. ROSKOS & CO. INC.

During 2003, Corporation management determined that JWR&Co was not attaining its strategic goals and that it would be in the best interest of the Corporation to discontinue offering family office services through JWR&Co. Therefore, the Corporation sold substantially all of the assets (the “Asset Sale”) of JWR&Co to PFO, effective June 30, 2003. The assets of JWR&Co, consisted of client accounts receivable and advances, fixed assets and prepaid expenses. The Asset Sale price was $2,350,000. JWR&Co received $400,000 in cash and three notes from PFO aggregating $1,950,000. The notes were for the accounts receivable and client advances, the fixed assets and prepaid expenses and for the goodwill, respectively. The note for the goodwill represented the value of the associated intangible assets of JWR&Co. The intangibles included the value of the client list, which was included in the Asset Sale. The note for the accounts receivable and client advances is being paid down from the proceeds of collected accounts receivable, with a term of 6 months. The note associated with the fixed assets and prepaid expenses is for a 5-year term. The goodwill note has an amortization of 15 years with a 10-year balloon payment. All three notes bear interest at a rate of 6%, with the interest rate on the goodwill note resetting after 7 years. There are no prepayment penalties on the notes. As of December 31, 2004, none of the notes were delinquent. PFO is also renting certain fixed assets and office space from the Bank.

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BMT SETTLEMENT SERVICES, INC.

BMT Settlement’s primary market area is located in southeastern Pennsylvania. BMT Settlement is housed in the main office of the Bank, located at 801 Lancaster Avenue, Bryn Mawr, PA 19010. BMT Settlement is a limited partner in the Limited Partnership with Commonwealth Land Transfer Company. During 2004, BMT Settlement earned $112,000 in revenues. BMT Settlement had no employees as of December 31, 2004.

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SOURCES OF THE CORPORATION’S REVENUE

The following table shows, for a five-year period, the percentage of consolidated revenues from continuing operations by major source generated by the Corporation’s subsidiaries from the activities indicated below.

	Year Ended December 31,
	2004		2003		2002		2001		2000
Commercial Loans	16	%	15	%	15	%	22	%	24	%
Mortgage and Construction Loans	30		26		27		19		18
Consumer Loans	4		4		7		13		17
Home Equity/Line of Credit	9		6		4		4		4
Securities	2		2		2		3		4
Federal Funds Sold	—		—		—		1		1
Total Interest Income	61		53		55		62		68
Wealth Management Services	20		17		16		18		19
Net gain on sale of loans	6		18		18		10		3
Other Income *	13		12		11		10		10
Total Revenues *	100	%	100	%	100	%	100	%	100	%

* Revenues were generated by the Bank, BMT Settlement and Insurance Counsellors in 2004 and 2003. Revenues were generated by the Bank, BMT Settlement, Insurance Counsellors, and BM Brokerage in 2002. Revenues were generated by the Bank, Insurance Counsellors, Bryn Mawr Asset Management, Inc. (“BMAM”), Bryn Mawr Advisors, Inc. (“BMA”) and BM Brokerage in 2001 and 2000. The 2004 total revenues generated by BMT Settlement and Insurance Counsellors were .6% and .2%, respectively.

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The 2003 total revenues generated by BMT Settlement and Insurance Counsellors were .7% and .6%, respectively. The 2002 total revenues generated by BMT Settlement, Insurance Counsellors and BM Brokerage were .6%, .6% and .3%. The 2001 total revenues generated by, BMAM, Insurance Counsellors and BM Brokerage were .2%, .5% and .4%, respectively. Of the Corporation’s total revenues generated in 2000, BMAM, BMA, Insurance Counsellors and BM Brokerage, respectively produced 1.8%, 1.8%, .4%, and .2% thereof.

STATISTICAL INFORMATION

The statistical information required in this Item I is incorporated by reference to the information appearing in the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004, as follows:

Disclosure Required by Industry Guide 3	Reference to the Corporation’s 2004 Annual Report (Financial Section)
I.       Distribution of Assets, Liabilities and Stockholders Equity; Interest Rates and Interest Differential
A.     Average balance sheets, interest - income and expense; average rates earned/paid	Analyses of Interest Rates and Interest Differential (page 10)
B.     Rate/Volume Differentials	Rate/Volume Analyses (page 11)
C.     Non-Accrual Policy	Loan Portfolio and Non - performing Asset Analysis (page 16)
D.     Interest Rate Sensitivity Analysis	Interest Rate Sensitivity Analysis. (page 20)

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Disclosure Required by Industry Guide 3	Reference to the Corporation’s 2004 Annual Report (Financial Section)
II.     Investment Portfolio
A.     Book Values	Notes to Consolidated Financial statements, Note3 (page 33)
B.     Maturities	Notes to Consolidated Financial Statements, Note3 (page 33)
III.    Loan Portfolio
A.     Types of Loans	Loan Portfolio (page 15)
B.     Maturities and Sensitivity to changes in Interest Rates	Loan Portfolio–Maturity Distribution (page 15) Interest Rate Sensitivity Analysis (page 21)
C.     Non-Performing Assets	Nonperforming Assets (page 16)
IV.   Summary of Loan Loss Experience
A.     Analysis of Loss Experience	Allowance for Loan Losses (page 12)
B.     Allocation of Allowance for Loan Losses	Allocation of the Allowance for Loan Losses (page 12)
V.     Deposits
A.     Average Deposits	Average Daily Balances of Deposits (Page 18)
B.     Maturity tables and outstanding balances, deposits $100,000 or more	Maturity of Certificates of Deposit of $100,000 or Greater (page 18)
VI.   Return on Equity and Assets	Selected Financial Data (page 1)

Financial Information About Segments

The financial information concerning the Corporation’s business segments is incorporated by reference to pages 7 through 9 of the

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Corporation’s Annual Report to the shareholders for the year ended December 31, 2004 and Note 21, page 43, Segment Information, to the financial statements accompanying that Annual Report.

COMPETITION

The Corporation’s principal purpose is to hold the stock of the Bank and the Corporation’s other subsidiaries. Therefore, there is presently neither a market area nor competition for the Corporation since it does not conduct competitive business activity other than through its subsidiaries.

The Bank’s market area is primarily located in portions of Delaware, Montgomery, Chester and Philadelphia Counties in southeastern Pennsylvania. The greatest concentration of activity is within a limited radius of Bryn Mawr, Pennsylvania, the site of the Bank’s main banking office. The Bank has seven full service branch offices located in Bryn Mawr, Havertown, Wayne, Wynnewood, Paoli, West Conshohocken and Newtown Square, Pennsylvania. In addition, there are seven limited service facilities located in life care communities in Waverly Heights, Martins Run, the Quadrangle, Beaumont at Bryn Mawr, Bellingham, White Horse Village and Rosemont Presbyterian Village. The Bank plans to open its eighth full service branch in Exton, Chester County, Pennsylvania during the first quarter 2005. All facilities are located in Montgomery, Chester or Delaware Counties.

The banking business is highly competitive. The Bank competes not only with other commercial banks but it also experiences competition from savings and loan associations, trust companies and credit unions for deposits and

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loans, as well as from consumer finance companies, mortgage companies, insurance companies, stock brokerage companies and other entities providing one or more of the services and products offered by the Bank. All of those organizations must be considered competitors of the Bank.

Insurance Counsellors’ market area is primarily located in southeastern Pennsylvania, New Jersey and Delaware, although they are able to market and sell insurance products and services anywhere in the United States. Insurance Counsellors is housed in the main office building of the Bank, located at 801 Lancaster Avenue, Bryn Mawr, Pennsylvania. Insurance Counsellors’ primary competition is from insurance agencies and insurance agents.

JWR&Co’s assets were sold effective June 30, 2003 and therefore, its operations were discontinued.

BMT Settlement’s primary market area is in southeastern Pennsylvania. BMT Settlement is housed in the main office of the Bank. The general partner in the Limited Partnership, Commonwealth Land Transfer Company, which provides the title, search and abstract services, is located in Wayne, PA. The Limited Partnership’s main competition is other title abstract companies. Commonwealth Land Transfer Company offers its services to residential and commercial real estate borrowers.

SUPERVISION AND REGULATION

Bank holding companies, such as the Corporation, and its subsidiaries, including the Bank, are subject to extensive regulation under both federal

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and state law. To the extent that the following information describes statutory provisions and regulations, which apply to the Corporation and its subsidiaries, it is qualified in its entirety by reference to those statutory provisions and regulations.

Regulation of the Corporation

The Bank Holding Company Act

The Corporation, as a bank holding company, is regulated under the Bank Holding Company Act of 1956, as amended (the “Act”). The Act limits the business of bank holding companies to banking, managing or controlling banks, performing certain servicing activities for subsidiaries and engaging in such other activities as the Federal Reserve Board may determine to be closely related to banking. The Corporation and its non-bank subsidiaries are subject to the supervision of the Federal Reserve Board and the Corporation is required to file with the Federal Reserve Board an annual report and such additional information as the Federal Reserve Board may require pursuant to the Act and the regulations which implement the Act. The Federal Reserve Board also conducts inspections of the Corporation and each of its non-banking subsidiaries.

The Act prohibits the Federal Reserve Board from approving a bank holding company’s application to acquire a bank or bank holding company located outside the state in which the operations of its banking subsidiaries are principally conducted, unless such acquisition is

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specifically authorized by statute of the state in which the bank or bank holding company to be acquired is located. Pennsylvania law permits bank holding companies located in any state to acquire Pennsylvania banks and bank holding companies, provided that the home state of the acquiring company has enacted “reciprocal” legislation. In this context, reciprocal legislation is generally defined as legislation that expressly authorizes Pennsylvania bank holding companies to acquire banks or bank holding companies located in another state on terms and conditions substantially no more restrictive than those applicable to such an acquisition in Pennsylvania by a bank holding company located in the other state.

The Act requires each bank holding company to obtain prior approval by the Federal Reserve Board before it may acquire (i) direct or indirect ownership or control of more than 5% of the voting shares of any company, including another bank holding company or a bank, unless it already owns a majority of such voting shares, or (ii) all, or substantially all, of the assets of any company. The Act provides that the Federal Reserve Board shall not approve any acquisition by a bank holding company of more than 5% of the voting shares or substantially all of the assets of a bank located outside of the state in which the operation of the holding company’s bank subsidiaries are principally conducted, unless such acquisition is specifically authorized by a statute of the state in which the bank whose shares are to be acquired is located.

The Act also prohibits a bank holding company from engaging in, or from acquiring direct or indirect ownership or control of more than 5% of the voting shares of any company engaged in non-banking activities unless the

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Federal Reserve Board, by order or regulation, has found such activities to be so closely related to banking or to managing or controlling banks as to be appropriate. The Federal Reserve Board has by regulation determined that certain activities are so closely related to banking or to managing or controlling banks, so as to permit bank holding companies, such as the Corporation, and its subsidiaries formed for such purposes, to engage in such activities, subject to obtaining the Federal Reserve Board’s approval in certain cases.

The Act further provides that the Federal Reserve Board shall not approve any such acquisition that would result in a monopoly or would be in furtherance of any combination or conspiracy to monopolize or attempt to monopolize the business of banking in any part of the country, or that in any other manner would be in restraint of trade, unless the anti-competitive effects of the proposed transactions are clearly outweighed by the public interest and the probable effect of the transaction in meeting the convenience and needs of the communities to be served.

Under the Act, a bank holding company and its subsidiaries are prohibited from engaging in certain tie-in arrangements in connection with any extension or provision of credit, lease or sale of property or furnishing any service to a customer on the condition that the customer provide additional credit or service to the bank, to its bank holding company or any other subsidiaries of its bank holding company or on the condition that the customer refrain from obtaining credit or service from a competitor of its bank holding company. Further, the Bank, as a subsidiary bank of a bank holding company, such as the Corporation, is subject to

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certain restrictions on any extensions of credit it provides to the Corporation or any of its non-bank subsidiaries, investments in the stock or securities thereof, and on the taking of such stock or securities as collateral for loans to any borrower.

In addition, the Federal Reserve Board may issue cease and desist orders against bank holding companies and non-bank subsidiaries to stop actions believed to present a serious threat to a subsidiary bank. The Federal Reserve Board also regulates certain debt obligations and changes in control of bank holding companies.

Under Federal Reserve Board policy, a bank holding company is expected to act as a source of financial strength to each of its subsidiary banks and to commit resources, including capital funds during periods of financial stress, to support each such bank. Although this “source of strength” policy has been challenged in litigation, the Federal Reserve Board continues to take the position that it has the authority to enforce it. Consistent with its “source of strength” policy for subsidiary banks, the Federal Reserve Board has stated that, as a matter of prudent banking, a bank holding company generally should not maintain a rate of cash dividends unless its net income available to common shareholders has been sufficient to fund fully the dividends, and the prospective rate of earnings retention appears to be consistent with the company’s capital needs, asset quality and overall financial condition.

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Financial Institutions Reform, Recovery and Enforcement Act

Following enactment by the United States Congress, on August 9, 1989, the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (“FIRREA”) became law. Although the more significant provisions of FIRREA relate to promoting the economic viability of thrift institutions through more stringent capital requirements and changes to the regulatory structure of such institutions, FIRREA also contains provisions that directly affect banks and bank holding companies, such as the Corporation. First, FIRREA abolished the Federal Savings and Loan Insurance Corporation and required the Federal Deposit Insurance Corporation (the “FDIC”) to establish two separate funds, the Bank Insurance Fund (“BIF”) to insure banks and the Savings Association Insurance Fund (“SAIF”) to insure savings and loan associations. Second, FIRREA amended the Act to permit bank holding companies to acquire thrift institutions. Prior to FIRREA, bank holding companies were permitted to acquire only failing thrift institutions. FIRREA also abolished the restrictions on tandem operations of acquired thrift institutions and the in-state preference for acquisitions of failing thrifts. Finally, FIRREA enhanced the authority of the regulatory authorities over financial institutions, including banks and bank holding companies, to regulate more effectively with the entire structure of a bank holding company.

Federal law also grants to federal banking agencies the power to issue cease and desist orders when a depository institution or a bank holding company or an officer or director thereof is engaged in or is about to engage in unsafe and unsound practices. The Federal Reserve Board may

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require a bank holding company, such as the Corporation, to discontinue certain of its activities or activities of its other subsidiaries, other than the Bank, or divest itself of such subsidiaries if such activities cause serious risk to the Bank and are inconsistent with the Bank Holding Company Act or other applicable federal banking laws.

Federal Deposit Insurance Corporation Improvement Act of 1991

The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) is legislation designed to reform and provide funding for the deposit insurance system by, among other things, requiring early intervention and closure of troubled institutions by the regulatory authorities and the resolution of failed institutions on the least-cost basis.

The FDICIA substantially alters the deposit insurance assessment process. The requirement that the FDIC provide at least sixty (60) days notice before requiring changes to the semiannual insurance assessment has been removed and the FDIC has the ability to change deposit insurance assessment rates much more rapidly than in the past. FDICIA grants the FDIC the authority to impose special “emergency” assessments on member banks at any time if necessary to pay interest or principal on borrowings or for other appropriate purposes. FDICIA also requires the FDIC to establish a risk-based assessment system for the deposit insurance funds. In addition, FDICIA establishes capital categories, such as, “well-capitalized”, “adequately capitalized”, “undercapitalized”, “significantly undercapitalized”, and “critically undercapitalized”. Under the guidelines currently

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issued by the regulators, the Bank is currently considered “well-capitalized”.

FDICIA also requires the regulators to place a financial institution under more intense scrutiny if its capital falls into a lower capital category. In addition, FDICIA restricts the liquidity that is available, through the Federal Reserve discount window, to troubled financial institutions and increases the scope of the regulatory authorities supervisory powers over financial institutions, including the Bank and Corporation.

Pursuant to federal law, federal regulatory authorities review the performance of the Corporation and their subsidiaries in meeting the credit needs of the communities served by the Bank. The applicable federal regulatory authority considers compliance with this law in connection with applications for, among other things, approval of branches, branch relocations and acquisitions of banks and bank holding companies.

Pennsylvania Laws Affecting the Corporation

Pennsylvania Anti-Takeover Legislation

The Corporation is also subject to the Pennsylvania Business Corporation Law of 1988, as amended and the general business and other laws of the Commonwealth of Pennsylvania regulating corporations.

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The Pennsylvania Legislature passed the Pennsylvania Anti-Takeover Law Act 36 of the 1990 Pennsylvania Legislature (“Act 36”) on April 27, 1990 which adds additional provisions to and amends the law of Pennsylvania concerning business corporations (the “Corporation Law”). Specifically, Act 36 (i) modifies and limits the fiduciary obligations of a corporation’s directors, withholds voting rights from control shares of corporation stock until consent of the Corporation’s independent shareholders is obtained at a shareholders meeting, prevents “green mail” by providing for disgorgement of certain profits by a control person or group within eighteen (18) months after an attempt to acquire control of a corporation. Act 36 also provides for severance compensation for certain terminated employees following control share acquisitions, and regulates the effect of certain business combinations on labor contracts.

Act 36, which is the Legislature’s response to the large volume of hostile takeovers over recent years, contains provisions which permitted a corporation’s board of directors to “opt-out” of certain provisions of the Act by explicitly amending the corporation’s by-laws on or before July 26, 1990. On July 20, 1990, the Corporation’s Board amended the Corporation’s by-laws to explicitly opt-out of the provisions of Act 36 which modify and limit a director’s fiduciary duty to the Corporation, withhold voting rights from “control shares” of the Corporation stock, and provide for disgorgement of certain profits on certain shares of the Corporation stock by a control person or group within eighteen months after an attempt to acquire the Corporation’s stock. Because the Corporation’s Board of Directors opted out of the provisions of Act 36 concerning fiduciary duty, control share acquisitions, and disgorgement of profits, the severance compensation and labor contract provisions of Act 36 are inapplicable to the Corporation.

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The Corporation’s Board opted-out of those provisions of the Act by amending the Corporation’s by-laws because it believed that those provisions of the Act were not in the best economic interests of the Corporation’s shareholders. In addition, the Board believed that, without those provisions of Act 36, the Board has sufficient flexibility under the applicable law to protect the interest of the shareholders. As outlined in the Corporation’s definitive proxy statement for the 1992 shareholders’ meeting, the Board of Directors recommended that the Corporation’s shareholders ratify and approve the amendment to the Corporation’s by-laws opting out of Act 36.

Shareholder Rights Plan

The Corporation adopted a Shareholder Rights Plan to enhance and protect the value of the shareholders’ investment in the Corporation and discourage unfair or financially inadequate takeover proposals and abusive takeover practices. The Plan provides for distribution of rights to purchase shares of the Corporation’s common stock. The rights would be distributed to shareholders as a dividend at a rate of one right for each share of common stock held by shareholders of record. The rights will be exercisable only if a person or group acquires beneficial ownership of twenty percent or more of the Corporation’s common stock.

Regulation of the Bank

The Corporation’s Pennsylvania state chartered bank, The Bryn Mawr Trust Company, is regulated and supervised by the Pennsylvania Department of

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Banking (the “Department of Banking”) and subject to regulation by The Federal Reserve Board and the FDIC. The Department of Banking and the Federal Reserve Board regularly examine the Bank’s reserves, loans, investments, management practices and other aspects of its operations and the Bank must furnish periodic reports to these agencies. The Bank is a member of the Federal Reserve System.

Federal Reserve Board and Department of Banking Regulations

The Bank’s operations are subject to certain requirements and restrictions under federal and state laws, including requirements to maintain reserves against deposits, limitations on the interest rates that may be paid on certain types of deposits, restrictions on the types and amounts of loans that may be granted and the interest that may be charged thereon, limitations on the types of investments that may be made and the types of services which may be offered. Various consumer laws and regulations also affect the operations of the Bank. These regulations and laws are intended primarily for the protection of the Bank’s depositors and customers rather than holders of the Corporation’s stock.

As a bank incorporated under and subject to Pennsylvania banking laws and insured by the FDIC, the Bank must obtain the prior approval of the Department of Banking and the Federal Reserve Board before establishing a new branch banking office. Depending on the type of bank or financial institution, a merger of banks located in Pennsylvania is subject to the prior approval of one or more of the following: the Department of Banking, the FDIC, the Federal Reserve Board and the Office of the Comptroller of the

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Currency. An approval of a merger by the appropriate bank regulatory agency would depend upon several factors, including whether the merged institution is a federally insured state bank, a member of the Federal Reserve System, or a national bank. Additionally, any new branch expansion or merger must comply with branching restrictions provided by state law. Beginning in 1990, the Pennsylvania Banking Code permitted Pennsylvania banks to establish branches anywhere in the state.

The Bank is insured by the FDIC, which currently insures the Bank’s deposits to a maximum of $100,000 per depositor. For this protection, each insured bank pays a semiannual statutory insurance assessment and is subject to certain rules and regulations of the FDIC. The amount of FDIC assessments paid by individual insured depository institutions, such as the Bank, is based on their relative risk as measured by regulatory capital ratios and certain other factors. Under this system, in establishing the insurance premium assessment for each bank, the FDIC will take into consideration the probability that the deposit insurance fund will incur a loss with respect to an institution, and will charge an institution with perceived higher inherent risks a higher insurance premium. The FDIC will also consider the different categories and concentrations of assets and liabilities of the institution, the revenue needs of the deposit insurance fund, and any other factors the FDIC deems relevant. A significant increase in the assessment rate or a special additional assessment with respect to insured deposits could have an adverse impact on the results of operations and capital levels of the Bank or the Corporation.

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Regulation of the Corporation-

Government Monetary Policies

The earnings and operations of the Corporation and its subsidiaries are affected by the policies of regulatory authorities and legislative changes; in particular, the policies of the Federal Reserve Board in regulating the money supply and interest rates. Among the instruments used by the Federal Reserve Board to implement its objectives are open-market operations in U.S. Government securities, changes in the discount rate for member bank borrowings, changes in reserve requirements against bank deposits, and changes with respect to regulations affecting certain borrowing by banks and their affiliates.

The monetary and fiscal policies of the Federal Reserve Board and the other regulatory agencies have had, and will probably continue to have, an important impact on the operating results of the Bank through their power to implement national monetary policy in order to, among other things, curb inflation or combat a recession. The monetary policies of the Federal Reserve Board may have a major effect upon the levels of the Bank’s loans, investments and deposits through the Federal Reserve Board’s open market operations in United States government securities, through its regulation of, among other things, the discount rate on borrowing of depository institutions, and the reserve requirements against depository institution deposits. It is not possible to predict the nature and impact of future changes in monetary and fiscal policies.

The earnings of the Bank and, therefore, of the Corporation are affected by domestic economic conditions, particularly those conditions in

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the trade area as well as the monetary and fiscal policies of the United States government and its agencies. The payment of dividends by the Bank through the Corporation is the source on which the Corporation currently depends to pay dividends to its shareholders.

The Federal Reserve Board also has authority to prohibit a bank holding company from engaging in any activity or transaction deemed by the Federal Reserve Board to be an unsafe or unsound practice. The payment of dividends could, depending upon the financial condition of the Bank or Corporation, be such an unsafe or unsound practice and the regulatory agencies have indicated their view that it generally would be an unsafe and unsound practice to pay dividends except out of current operating earnings. The ability of the Bank to pay dividends in the future is presently and could be further influenced, among other things, by applicable capital guidelines discussed below or by bank regulatory and supervisory policies. The ability of the Bank to make funds available to the Corporation is also subject to restrictions imposed by federal law. The amount of other payments by the Bank to the Corporation is subject to review by regulatory authorities having appropriate authority over the Bank or Corporation and to certain legal limitations.

The passage of additional legislation by Congress authorizing additional continuing legal and regulatory supervision of financial institutions, requiring additional disclosure concerning deposit transactions and permitting more rapid increases in deposit insurance premiums may increase the cost and the operational expenses even for efficiently run and well-capitalized financial institutions and may adversely affect the profit margins of the Bank and the Corporation.

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Risk Based Capital Guidelines

The Federal Reserve Board has promulgated certain “Risk Based Capital Guidelines” which more narrowly define bank capital, as it relates to assets, than do prior regulatory guidelines. Under the guidelines, various types of Corporation assets are assigned risk categories and weighted based on their relative risk. In addition, certain off balance sheet items are translated into balance sheet equivalents and also weighted according to their potential risk. The sum of both of these asset categories, referred to as Total Risk Weighted Assets, is then compared to the Corporation’s total capital, providing a Tier I Capital Ratio, under the guidelines. A Tier II capital ratio is also computed for the Corporation, adding an allowable portion of the loan loss reserve to capital. Both the Tier I and Tier II ratios of the Corporation are in excess of those minimum capital ratios required. The focus of the guidelines is to measure the Corporation’s capital risk. The guidelines do not explicitly take into account other risks, such as interest rate changes or liquidity.

The Bank in its normal business originates off-balance sheet items, such as outstanding loan commitments and standby letters of credit. The Bank makes loan commitments to borrowers to assure the borrower of financing by the Bank for a specified period of time and/or at a specified interest rate. The obligation to the Bank, pursuant to an unfunded loan commitment, is limited by the terms of the commitment letter and other loan documentation issued by the Bank to each borrower. The Bank carefully

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reviews outstanding loan commitments on a periodic basis. A standby letter of credit is an instrument issued by the Bank, which represents a contingent obligation to make payments with respect to a specific transaction of a customer. The Bank carefully evaluates the creditworthiness of each of its letter of credit customers. The Corporation carefully monitors its risks as measured by the Risk Capital Guidelines and seeks to adhere to the Risk Capital Guidelines.

Financial Services Act

On March 11, 2000 the Financial Services Act of 1999 (the “FSA”), sometimes referred to as the Gramm-Leach-Bliley Act, became effective. The FSA repealed provisions of the Glass-Steagall Act, which had prohibited commercial banks and securities firms from affiliating with each other and engaging in each other’s businesses. Thus, many of the barriers prohibiting affiliations between commercial banks and securities firms have been eliminated.

The FSA amended the Glass-Steagall Act to allow new “financial holding companies” (“FHC”) to offer banking, insurance, securities and other financial products to consumers. Specifically, the FSA amends section 4 of the Act in order to provide for a framework for the engagement in new financial activities. Bank holding companies may elect to become a financial holding company if all its subsidiary depository institutions are well-capitalized and well-managed. If these requirements are met, a bank holding company may file a certification to that effect with the Federal Reserve Board and declare that it elects to become a FHC. After the

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certification and declaration is filed, the FHC may engage either de novo or through an acquisition in any activity that has been determined by the Federal Reserve Board to be financial in nature or incidental to such financial activity. Bank holding companies may engage in financial activities without prior notice to the Federal Reserve Board if those activities qualify under the new list in section 4(k) of the Act. However, notice must be given to the Federal Reserve Board, within 30 days after the FHC has commenced one or more of the financial activities. The Corporation has not become an FHC.

Under the FSA, a bank subject to various requirements is permitted to engage through “financial subsidiaries” in certain financial activities permissible for affiliates of FHC’s. However, to be able to engage in such activities a bank must continue to be well-capitalized and well-managed and receive at least a “satisfactory” rating in its most recent Community Reinvestment Act examination.

Privacy of Consumer Financial Information

The FSA also contains a provision designed to protect the privacy of each consumer’s financial information in a financial institution. Pursuant to the requirements of the FSA, the financial institution regulators (the “Regulators”) have promulgated final regulations (the “Regulations”) intended to better protect the privacy of a consumer’s financial information maintained in financial institutions. The Regulations are designed to prevent financial institutions, such as the Bank, from disclosing a consumer’s nonpublic personal information to third parties that are not affiliated with the financial institution.

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However, financial institutions can share a customer’s personal information or information about business and corporations with their affiliated companies. The Regulations also provide that financial institutions can disclose nonpublic personal information to nonaffiliated third parties for marketing purposes but the financial institution must provide a description of its privacy policies to the consumers and give the consumers an opportunity to opt-out of such disclosure and, thus, prevent disclosure by the financial institution of the consumer’s nonpublic personal information to nonaffiliated third parties.

The Regulators, among other things, provide guidance concerning what are “nonpublic personal information”, “consumers”, and “customers”, as well as about the required timing for notices to customers and the means by which customers can exercise their rights to opt-out of disclosure of their personal information.

These privacy Regulations will affect how consumer’s information is transmitted through diversified financial companies and conveyed to outside vendors. The Bank does not believe the privacy Regulations will have a material adverse impact on its operations in the near term.

Consumer Protection Rules – Sale of Insurance Products

In addition, as mandated by the FSA, the Regulators have published consumer protection rules (the “Rules”) which apply to the retail sales

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practices, solicitation, advertising or offers of insurance products, including annuities, by depository institutions such as banks and their subsidiaries.

In very brief summary the Rules provide, that before the sale of insurance or annuity products can be completed, disclosures must be made that state such insurance products are not deposits or other obligations of or guaranteed by the FDIC or any other agency of the United States, the Bank or its affiliates, and in the case of an insurance product, including an annuity, that involves an investment risk, that there is an investment risk involved with the product, including a possible loss of value.

The Rules also provide that the Bank may not condition an extension of credit on the consumer’s purchase of an insurance product or annuity from the Bank or its affiliates or on the consumer’s agreement not to obtain or a prohibition on the consumer obtaining an insurance product or annuity from an unaffiliated entity.

The Rules also require formal acknowledgement from the consumer that such disclosures have been received. In addition, to the extent practical, the Bank must keep insurance and annuity sales activities physically separate from the areas where retail banking transactions are routinely accepted from the general public.

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The Fair and Accurate Credit Reporting Transactions Act

The Fair and Accurate Credit Reporting Transactions Act of 2003 (the “Fact Act”) became law on December 4, 2003. Among other things, the Fact Act permanently extended the provisions of the Fair Credit Reporting Act (the “FCR Act”) that would have expired on January 1, 2004 and had prevented the states from enforcing credit reporting laws that were more restrictive than the FCR Act provisions.

Specifically, the Fact Act now permanently prohibits the states from enforcing laws stricter that the Fact Act that regulate: the prescreening of consumer reports, (2) the time within which credit bureaus must respond to consumer disputes, (3) the duties of users of credit bureau information, (4) the information contained in the credit reports, (5) the duties of information providers, and (6) the exchange of credit information between affiliates.¹

The Fact Act also contains provisions designed to reduce identity thief and protect the confidentiality of a consumer’s private medical information.

Sarbanes-Oxley Act

On July 30, 2002 President Bush signed into law the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). The stated goals of the Sarbanes-Oxley Act are to increase corporate responsibility, provide enhanced penalties for accounting and auditing improprieties by publicly traded companies and to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to the securities law. The changes required by the Sarbanes-Oxley Act and its implementing regulations are intended to

¹ In addition the Fact Act contains provisions concerning (i) how often consumers may obtain free copies of their credit reports, (ii) the disclosure of credit scores used for credit decisions, (iii) a consumers opt-out procedure for exchange of credit information, that would otherwise be treated as a credit report, among affiliates, (iv) the duty of lenders to notify consumers that information contained in their credit reports resulted in their receiving credit on less than the most favorable terms.

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allow shareholders to monitor the performance of companies and their directors more easily and effectively.

The Sarbanes-Oxley Act generally applies to all domestic companies, such as the Corporation, that file periodic reports with the SEC under the Securities Exchange Act of 1934, as amended. Furthermore, the Sarbanes-Oxley Act includes very significant additional disclosure requirements and new corporate governance rules, which required the SEC, the securities exchanges and the NASDAQ stock market to adapt extensive additional disclosures, corporate governance provisions and other related rules as well as mandating that studies of certain significant issues be made by the SEC and the U.S. Comptroller General.

The Sarbanes-Oxley Act addresses, among other matters, audit committees; certification of financial statements by the chief executive officer and the chief financial officer; forfeiture of bonuses and profits made by directors and senior officers in the twelve (12) month period covered by restated financial statements; a prohibition on insider trading during pension blackout periods; disclosure of off-balance sheet transactions; a prohibition applicable to companies, other than federally insured financial institutions, on personal loans to their directors and officers; expedited filing of reports concerning stock transactions by a company’s directors and executive officers; the formation of a public accounting oversight board; auditor independence; and increased criminal penalties for violation of certain securities laws.

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To implement the requirements of the Sarbanes-Oxley Act and its implementing regulations, the Corporation’s management has instituted a series of actions to strengthen and improve the Corporation’s already strong corporate governance practices. Included in those actions was the amendment and restatement of the Corporation’s code of business conduct and ethics and enhancement of our current systems designed to evaluate and monitor the continued effectiveness of the design and operation of the Corporation’s internal controls and procedures for financial reporting. The Corporation’s and the Bank’s systems of internal controls and procedures, which are in place, are designed to capture information from all segments of its business.

As required by section 404 of the Sarbanes Oxley Act of 2002 (“SOX-404”), during 2004, the Corporation undertook a project to determine (1) what internal controls for public financial reporting were in place and (2) what additional internal controls needed to be implemented in order to gain assurance that the Corporation properly presents its financial statements and related footnotes, under generally accepted accounting principals of the United States (“GAAP”). To accomplish this task, the Corporation hired an independent consultant, experienced in complying with SOX-404, to assist management in completing the project and thereby enabling the chief executive officer and chief financial officer to certify whether or not there were any significant deficiencies or material weaknesses in the internal controls, established to assure that the financial statements were prepared under GAAP.

KPMG LLP (“KPMG”), the Corporation’s Independent Registered Public Accounting Firm, has issued an attestation report that management’s

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assessment that the Corporation maintained effective internal control over financial reporting as of December 31, 2004 is fairly stated, in all material respects, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Also in their opinion, KPMG stated that the Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2004, based on COSO. The cost of this project for 2004 amounted to $470,000. It is anticipated that future costs to comply with SOX-404 will be less than the year of adoption.

This series of actions described above by the Corporation’s and the Bank’s management compliments and improves the Corporation’s long-standing committees, particularly the Audit Committees and Risk Management Committees of the Boards of the Corporation and the Bank, as well as, the adoption of a charter by the nominating committees of the Corporation’s and the Bank’s Board of Directors and the Corporation’s and Bank’s structures and processes which have consistently provided an invaluable tool for strengthening internal controls, communications and disclosure of necessary information to those who must know and use it. In 2004, the Corporation created the position of Lead Independent Director. A description of the responsibilities and duties of the Lead Independent Director are incorporated by reference to page 3 of the definitive proxy statement of the Corporation filed on March 8, 2004 with the SEC pursuant to Regulation 14A.

At the Corporation and the Bank, each key material element of their operation is subject to oversight by a committee to help insure proper internal controls and procedures, administration, risk management and

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delivery of critical information disclosures to appropriate audit and financial officers, executive management, Board committees and the Boards of Directors. The Corporation’s management believes that the addition of these new controls and processes has brought with it a broader and more in depth analysis of the Corporation’s already effective and detailed systems of controls and procedures and corporate governance.

Patriot Act of 2001

The Patriot Act of 2001, which was enacted in the wake of the September 11, 2001 attacks, includes provisions designed to combat international money laundering and advance the U.S. government’s war against terrorism. The Patriot Act and the regulations, which implement it, contain many obligations which must be satisfied by financial institutions, including the Bank, which will involve additional expenses for the Bank.

Government Policies and Future Legislation

As the enactment of the FSA and the Sarbanes-Oxley Act confirm, from time to time, various proposals are made in the United States Congress as well as Pennsylvania legislature and by various bank regulatory authorities which would alter the powers of, and place restrictions on, different types of banks and financial organizations. Among current proposals of significance to the Corporation or its subsidiaries are the continued liberalization of the restrictions on the acquisitions of out-of-state banks by bank holding companies, the expansion of the powers of banks and thrift institutions, the liberalization of the restrictions upon the activities in which bank holding companies may engage, the imposition of limitations on service charges, elimination of the prohibition of paying interest on

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business deposit accounts, certain consumer legislation and the requirement to provide certain basic banking services. It is impossible to predict whether any of the proposals will be adopted and the impact, if any, of such adoption on the business of the Corporation or its subsidiaries, especially the Bank.

Impact of Future Legislation and Governmental Policies

As the enactment of the FSA and the Sarbanes-Oxley Act confirm, from time to time, various proposals are made in Congress, in the Pennsylvania legislature and by various bank regulatory authorities which would alter the powers of or place restrictions upon banks and other financial institutions.

As a consequence of the extensive regulations of banking activities in the United States, the Bank’s business is particularly susceptible to being affected by federal and state legislation and regulations that may increase the cost of doing business or curtail the business in which the Bank and its affiliates may engage.

The rules and regulations, discussed above, which implement the Sarbanes-Oxley Act had a significant economic impact on the compliance cost of the Corporation and all publicly traded companies. It is not possible to assess the future impact on the Corporation or the Bank of any of the foregoing regulations and proposed regulations.

From time to time enactment of legislation or promulgation of regulations may impact the business of the Bank and its affiliates. It

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cannot be predicted whether such legislation or regulations will be adopted, and if adopted, how these would affect the Bank and its affiliates.

Subsidiaries of the Corporation

The non-bank subsidiaries of the Corporation are also subject to regulation and inspection by the Federal Reserve Board and must file periodic reports with the Federal Reserve Board.

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ITEM 2. PROPERTIES

The headquarters of the Corporation and the main office of the Bank are located in a three story stone front office building, consisting of approximately 37,000 net usable square feet, located at the main intersection of Bryn Mawr, Pennsylvania, at Lancaster Avenue and Bryn Mawr Avenue. The main office of the Bank has been located in Bryn Mawr since its founding in 1889. The Corporation acquired two additional properties during 1988, that is (i) a property contiguous to the Bank’s main office and (ii) a property at 10 Bryn Mawr Avenue to house the Bank’s Wealth Management Division. The first property, which is contiguous to the Bank’s main office, houses an expanded drive-up facility and a meeting room. The second property became the location of the Bank’s Wealth Management Division in mid-December, 1989. The real property owned by the Corporation and the Bank, is free and clear of all liens and encumbrances. Below is a schedule of all properties owned or leased by the Corporation or its subsidiaries.

The Bank:

Current Banking Office	Address	Date Acquired or Opened
Main Office and Principal Place of Business (owned)	801 Lancaster Avenue Bryn Mawr, PA 19010	1889
Branch Office/Operations Center (owned)	330 E. Lancaster Avenue Wayne, PA 19087	1985
Branch Office/Admin. Office (owned)	18 W. Eagle Road Havertown, PA 19083	1987

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Current Banking Office	Address	Date Acquired or Opened
Branch Office (owned)	312 E. Lancaster Avenue Wynnewood, PA 19096	1979
Branch Office (owned)	N.E. Corner of Lancaster and Greenwood Avenues Paoli, PA 19301	1986
Branch Office (leased) Through July 31, 2007	One Tower Bridge (1) West Conshohocken, Pa 19428	1995
Branch Office (leased) month to month basis	The Quadrangle (2) 3300 Darby Road Haverford, PA 19041-1095	1989
Branch Office (leased) month to month basis	Waverly Heights, Ltd. (2) Life Care Community Gladwyne, PA 19035	1986
Branch Office (leased) month to month basis	Martins Run (2) Life Care Community 11 Martins Run Media, PA 19063	1987
Branch Office (leased) Through Oct 31, 2004 Month to month basis	Bellingham (2) 1615 East Boot Road West Chester, PA 19380	1991
Branch Office (leased) Year to year basis	Beaumont at Bryn Mawr (2) Retirement Community Bryn Mawr, PA 19010	1995
Office Space (leased) through March 1, 2028	2&6 Bryn Mawr Avenue (5) Bryn Mawr, Pa. 19010	1999
Branch Office (leased) Month to month basis	White Horse Village (2) 535 Gradyville Road Newtown Square, PA.	2000

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Current Banking Office	Address	Date Acquired or Opened
Branch Office (leased) Through January 31, 2007	Rosemont Presbyterian Village (2) 404 Cheswick Place Rosemont, PA 19010-1251	2002
Branch Office (leased) Leased through April 1, 2012	3601 West Chester Pike (6) Newtown Township, Delaware County, PA 19073	2002
Branch Office (leased) Leased through March 31, 2014	Brentwood Shoppes (7) 224 North Pottstown Pike Exton, PA 19341	2004

* Leases automatically renew annually unless terminated by either party.

The Corporation:

Other Facilities	Address	Date Acquired or Opened
Walk-in Lobby, Drive-up Windows, Meeting Room (owned)	813 Bryn Mawr Avenue (3) Bryn Mawr, PA 19010	1988
Office Building (owned)	10 Bryn Mawr Avenue (4) Bryn Mawr, PA 19010	1988

(1) This branch is on the lobby level of an office building and has been established to primarily meet the needs of the occupants of the office building and the surrounding community. There is an automatic teller machine located within the facility. The lease is for 705 square feet and expires on July 31, 2007.

(2) This branch office has been established primarily to meet the needs of the residents of the Life Care Community in which it is located.

(3) This property is contiguous to the Bank’s main office, originally housed a gas station, which was demolished. This property houses a walk-in lobby, expanded drive-up facility and a meeting room, and was put in service in August, 1990.

(4) This property became the new location of the Bank’s Wealth Management Division, in mid-December, 1989.

(5) This lease is for 24,800 square feet of office space to house the support staff which was formerly located in the Bank’s main office

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at 801 Lancaster Avenue. The support areas currently located at this location are Audit, Human Resources, Marketing, Corporate Sales, Loan Operations and Comptrollers.

(6) The lease is for a parcel of real property on which the Bank constructed a full service bank branch office consisting of a building of thirty seven hundred square feet and two drive through lanes. The lease provides the Bank the option of renewing the lease, after the initial ten year period, for an additional nineteen years, in three five year increments and one four year increment.

(7) The lease is for a parcel of real property on which the Bank renovated an existing full service bank branch into an upgraded full service bank branch office consisting of the building of twenty six hundred square feet and three drive through lanes. The lease is for an initial ten year period and, with one ten year option and one nine year eleven month option to renew.

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ITEM 3. LEGAL PROCEEDINGS

Neither the Corporation nor any of its subsidiaries is a party to, nor is any of their property the subject of, any material legal proceedings other than ordinary routine litigation incident to their businesses.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted during the fourth quarter of the fiscal year covered by this report to a vote of security holders, which is required to be disclosed pursuant to the instructions contained in the form for this report.

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PART II

ITEM 5. MARKET FOR THE REGISTRANT’S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

The information required by this Item 5 is incorporated by reference to the information appearing under the caption “Price Range of Shares” on page 15 of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

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5c.

During the fourth quarter of 2004, the Corporation maintained, and continues to maintain, one stock repurchase program. The following table presents the repurchasing activity of this program during the fourth quarter of 2004:

ISSURER PURCHASES OF EQUITY SECURITIES

Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plan or Programs
Month #10 Oct. 1, 2004 – Oct. 31, 2004	—	$	0	—	134,494
Month #11 Nov. 1, 2004 – Nov. 30, 2004	—	$	0	—	134,494
Month #12 Dec. 1, 2004 – Dec. 31, 2004	—	$	0	—	134,494
Total	—	$	0	—	134,494

Notes to this table:

(1) On October 17, 2002 the Board of Directors of the Corporation authorized a stock repurchase program, effective in January 2003. This stock repurchase program is the only stock repurchase program presently in effect (the “Program”). This Program was publicly announced in a press release, also issued on October 17, 2002.

(2) The Corporation was authorized to repurchase an amount of Corporation stock, not to exceed the lesser of $7,500,000 or 4% of the then outstanding shares of common stock, which, after the

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effect of the two-for-one stock split, effective October 1, 2003, amounted to 348,094 shares. During 2004, under the Program, the Corporation repurchased 114,600 shares of Corporation stock, having an average cost of $22.46 per share.

(3) The Program will expire on December 31, 2007.

(4) No stock repurchase programs expired during the period covered by the table.

(5) The Corporation presently has no plans for an early termination of the Program.

(6) All shares were purchased through the Program and were accomplished in open-market transactions.

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ITEM 6. SELECTED FINANCIAL DATA

The information required by this Item 6 is incorporated by reference to the information appearing under the caption “Selected Financial Data” on page 1 of the financial section of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information required by this Item 7 is incorporated by reference to the information appearing under the caption “Management’s Discussion and Analysis” on pages 2 to 23 of the financial section of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

ITEM 7A. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The financial information required by this item 7A is incorporated by reference to page 19, Off-Balance Sheet Commitments and Contractual Cash Obligations, page 20, Asset and Liability Management, Interest Rate Sensitivity; page 20, the Table of Interest Rate Sensitivity as of December 31, 2004, and page 21, Liquidity in the financial section of the Corporation’s Annual Report to the shareholders for the year ended December 31, 2004.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements and the auditor’s report thereon and supplementary data required by this Item 8 are incorporated by reference on pages 25 to 29 respectively, of the financial section of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

On December 19, 2003, the Corporation retained KPMG LLP (‘KPMG”) as its new independent registered public accounting firm to audit the Corporation’s financial statements for the fiscal year ended December 31, 2004. PricewaterhouseCoopers LLP (“PwC”) continued to serve as the Corporation’s independent registered public accounting firm for the fiscal year ended December 31, 2003². The decision to change independent registered public accounting firms was made by the Audit Committee of the Corporation.

The reports of PwC on the financial statements for the past two fiscal years contain no adverse opinions or disclaimer of opinion and were

² PwC did audit the Corporation’s Thrift and Savings Plan and the Corporation’s Pension Plan and perform the Common Trust Fund and USAP audits for the Corporation’s subsidiary, The Bryn Mawr Trust Company, for the fiscal year ended December 31, 2003.

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not qualified or modified as to their uncertainty, audit scope or accounting principle.

During each of the fiscal years ended December 31, 2002 and 2003, and the subsequent interim period through March 15, 2004, there were no disagreements between the Corporation and PwC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of PwC would have caused it to make reference to the subject matter of the disagreements in connection with its reports; and there were no “reportable events” as that term is defined in Item 304 (a)(1)(v) of Regulation S-K occurring within the Corporation’s two most recent fiscal years and identified through the date of this Report.

The Corporation provided PwC with a copy of the foregoing disclosures and requested that PwC review such disclosures and provide a letter addressed to the SEC stating whether they agreed with such statements. A copy of PwC’s letter response to such request was attached to the Corporation’s 8-K/A filed with the SEC on March 15, 2004.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Corporation carried out an evaluation, under the supervision and with the participation of the Corporation’s management, including the Corporation’s Chief Executive Officer, Frederick C. Peters II and Chief Financial Officer, Joseph W. Rebl, of the effectiveness of the design and

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operation of the Corporation’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2004 pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Corporation’s disclosure controls and procedures as of December 31, 2004, are effective in timely alerting them to material information relating to the Corporation (including its consolidated subsidiaries) required to be included in the Corporation’s periodic SEC filings.

Changes in Internal Control over Financial Reporting

As of the date of this Report, there have not been any significant changes in the Corporation’s internal control over financial reporting that have materially affected or are reasonably likely to materially affect the Corporation’s internal control over financial reporting.

Management’s Report on Internal Control over Financial Reporting

The information required in this Item 9A is incorporated by reference to page 23 of the financial section of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

Report of Independent Registered Public Accounting Firm

The information required in this Item 9A is incorporated by reference to page 24 of the financial section of the Corporation’s Annual Report to Shareholders for the year ended December 31, 2004.

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III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information with respect to Directors of the Corporation is incorporated by reference on pages 2 through 9 of the definitive proxy statement of the Corporation filed on March 8, 2005 with the SEC pursuant to Regulation 14A.

The Committees of the Corporation’s Board of Directors are incorporated by reference on pages 3 through 6 of the definitive proxy statement of the Corporation fled on March 8, 2005 with the SEC pursuant to Regulation 14A.

Each member of the Audit Committee is independent and financially literate as defined by NASDAQ. The Board of Directors of the Corporation has determined that James J. Smart is a financial expert as defined by SEC regulations.

The Boards of Directors of the Corporation and the Bank have determined that all of its members are independent and meet the independence requirements of The NASDAQ Stock Market (“NASDAQ”), except for Frederick C. Peters, II. Because Mr. Peters is the President and Chief Executive Officer

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of the Corporation and the Bank, he is not independent as defined by NASDAQ. Mr. Peters also serves as Chairman of the Corporation and the Bank.

Executive Officers of the Corporation and the Bank. Below is certain information with respect to the executive officers of the Corporation and Bank as of February 24, 2005:

NAME	AGE AS OF FEBRUARY 24, 2005	OFFICE WITH THE CORPORATION AND/OR BANK
Frederick C. Peters II	55	President and Chief Executive Officer and Chairman of Corporation and Bank
Alison E. Gers	47	Executive Vice President of Bank - Administration and Operations
Joseph G. Keefer	46	Executive Vice President of Bank - Chief Lending Officer
John Pickering	49	Executive Vice President - Wealth Management Division
Joseph W. Rebl	60	Treasurer of Corporation and Executive Vice President, Treasurer & Chief Financial Officer of Bank
Robert J. Ricciardi	55	Secretary of Corporation and Executive Vice President and Secretary of the Bank, Chief Credit Policy Officer

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Mr. Peters was elected President and Chief Executive Officer and a Director of the Corporation and the Bank on January 22, 2001. Mr. Peters was elected the Chairman of the Board of the Bank and Corporation, effective August 5, 2002. Prior to that, Mr. Peters was founder, President and Chief Executive Officer of the 1^st Main Line Bank, a division of National Penn Bank, from May 1995 to January 2001. From 1985 to 1995, Mr. Peters was the founding President and Chief Executive Officer of National Bank of the Main Line. Prior to 1985, Mr. Peters was employed by Industrial Valley Bank as a Regional Vice President in a lending capacity. In January 2004, Mr. Peters took over the management of sales and marketing in the Wealth Management Division, until April 2004, when John Pickering assumed management responsibility for the Wealth Management Division.

Ms. Gers was employed by the Bank as Senior Vice President-Marketing in May 1998. In February 2001, Ms. Gers was designated Executive Vice President of the Bank, having responsibility for marketing, administrative services and operations. Prior to her employment by the Bank, she was Executive Vice President of CoreStates Bank, NA from July 1995 until May 1998, having responsibility for retail and small business marketing, advertising and product development, and prior to that Senior Vice President in charge of retail product management from 1993 to 1995. From February 1988 until August 1992, Ms. Gers was Senior Vice President of Home Unity Savings Bank, having responsibility for retail banking. From January 1986 to October 1987, she was Marketing Director for Colonial Penn Group. From February 1983 until January 1986, she was Product Manager for third party life and health insurance products for National Liberty Marketing. In January 2004, Ms. Gers, took over the management of the day to day operations of the Wealth Management Division,

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until April 2004, when John Pickering assumed management responsibility for the Wealth Management Division.

Mr. Keefer was employed by the Bank as Vice President and Commercial Lending manager in March 1991. He was promoted to Senior Vice President of Commercial and Real Estate Lending Services in July 1994 and was made the Bank’s Chief Lending Officer in December 1997. In December 2002 Mr. Keefer assumed responsibility for the Bank’s Credit Division which included Commercial and Real Estate Lending, Consumer and Small Business Lending, BMT Mortgage and Loan Operations. In February 2001, Mr. Keefer was designated Executive Vice President and Chief Lending Officer of the Bank. Prior to his employment by the Bank, Mr. Keefer was employed by First Pennsylvania Bank, NA from June 1980 until March 1991, where he was a Vice President in the commercial lending division.

Mr. Pickering was appointed Executive Vice President of the Bank in charge of the Wealth Management Division on April 12, 2004. From January, 2001 through April 2004, Mr. Pickering was a Managing Director with Brown Brothers Harriman & Co. a private banking firm, and was responsible for the Americas Financial Institutions Department within the Global Custody Division. From March, 2002 through June, 2003, Mr. Pickering was also the Managing Director of Brown Brothers Harriman Investor Services, Ltd. in London. Prior to that, Mr. Pickering was a Senior Vice President at Brown Brothers Harriman in the Global Custody Division from July, 1998 through January, 2001. In addition to his management duties, Mr. Pickering was responsible for relationship management and business development for banking, custody and investment management clients.

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Mr. Rebl was employed by the Bank and elected its Comptroller in 1981. He was elected Vice President and Comptroller in 1983 and Senior Vice President in 1987. Upon the formation of the Corporation in 1986, Mr. Rebl was elected Treasurer of the Corporation. In 1992, Mr. Rebl was designated the Bank’s Senior Vice President-Finance. In 1994, Mr. Rebl was designated Treasurer of the Bank. In 1999, Mr. Rebl was designated Chief Financial Officer of the Bank. In February 2001, Mr. Rebl was designated an Executive Vice President of the Bank. In December 2004, Mr. Rebl announced that he was retiring from the Bank and Corporation, effective April 22, 2005.

Mr. Ricciardi was employed by the Bank in 1971 and elected an Assistant Treasurer in 1973. Mr. Ricciardi was elected an Assistant Vice President of the Bank in 1976 and a Vice President in 1981. In 1989, Mr. Ricciardi was elected Senior Vice President of Real Estate Lending. In November, 1993, he was elected Executive Vice President and assumed responsibility for the Bank’s Community Banking Division. In November 1997, Mr. Ricciardi was named the Bank’s Chief Credit Policy Officer and relinquished responsibility for the Community Banking Division. In January 2001, Mr. Ricciardi was named Secretary of the Corporation and the Bank.

None of the above executive officers has any family relationship with any other executive officer or with any director of the Corporation or Bank.

The Corporation has adopted a Code of Business Conduct and Ethics (“the Code”) which amended, restated and combined into one code its Code of Ethics for Officers and Directors and its Employee Code of Ethics. The Code

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is available on the Corporation’s website at www.bmtc.com under the “Code of Ethics” caption and printed copies are available to any shareholder upon request. The Code meets the requirements for a code of ethics for the Corporation’s principal executive officer, principal financial officer or persons performing similar functions under Item 406 of Regulation S-K of the SEC. Any amendments to the Code, or any waivers of the Code for directors or executive officers will be disclosed promptly on a Form 8-K filed with the SEC or by any other means approved by the SEC.

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ITEM 11. EXECUTIVE COMPENSATION

The information required by this Item 11 is incorporated by reference to pages 10 through 17 of the definitive proxy statement of the Corporation, filed with the SEC pursuant to Regulation 14A.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the information required to be disclosed for the Corporation’s Equity Compensation Plan.

Equity Compensation Table

Plan Category	Number of securities to be issued upon exercise of outstanding options	Weighted-average exercise price of outstanding options		Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders	652,784	$	15.80	351,905
Equity compensation plans not approved by security holders	—		—	—
Total	652,784	$	15.80	351,905

The Corporation has agreed to pay and its non-employee independent directors have agreed to accept payment of their annual $10,000 retainer compensation in the form of Corporation common stock, payable in April of each year at the market value of the stock on the day prior to day of payment. If all of the Corporation’s non-employee independent directors, including the directors elected at the annual meeting in April 2005, continue this compensation arrangement, for their 2005-2006 terms as directors, it is estimated, based on the per share $21.99 market price of the stock on December 31, 2004, that such directors, as a group, will receive an aggregate of 3,638 shares of the Corporation’s common stock as retainer compensation.

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Additional information required by this Item 12 is incorporated by reference to page 2, and pages 8 and 9 of the Corporation’s definitive proxy statement, filed with the SEC pursuant to Regulation 14A.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There were no relationships or transactions required to be disclosed in this Item 13 pursuant to the instructions contained in the form for this report, as discussed on pages 16 and 17 of the Corporation’s definitive proxy statement, filed with the SEC pursuant to Regulation 14A.

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ITEM 14. PRINCIPLE ACCOUNTING FEES AND SERVICES

The information required by this Item 14 is incorporated by reference to page 21 of the definitive proxy statement of the Corporation, filed with the SEC pursuant to Regulation 14A.

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) The following exhibits are filed as a part of this report.

EXHIBIT TABLE

3 - Articles of Incorporation and By-Laws

(A)    (i)     Articles of Incorporation, effective August 8, 1986, are incorporated by reference to Form S-4 of the Registrant, No. 33-9001.

(ii) Amendment to the Articles of Incorporation, effective April 23, 1998.

(iii) Articles of Merger / Consolidation, effective April 1, 1999.

(B) By-Laws of the Registrant, incorporated by reference as amended and restated January 20, 2000.

4 - Instruments defining the rights of security holders

(A) Articles of Incorporation and By-Laws: See Item 3(A) & (B) above.

(B) Shareholders Rights Plan: incorporated by reference to 8-K filed with the SEC on November 25, 2003.

10 - Material Contracts

(A) The Bryn Mawr Bank Corporation Amended and Restated 1986 Stock Option and Stock Appreciation Plan, is hereby incorporated by reference to the Corporation’s Proxy Statement dated march 14, 1994 and filed with the Commission as Appendix A to the proxy Statement on March 15, 1994.

(B) License Agreement dated December 30, 1994, between Bryn Mawr Bank Corporation and FIServ Cir, Inc. is incorporated by reference to the Corporation’s 10-K, filed with the Securities and Exchange Commission on March 31, 1995.

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(C) The Bryn Mawr Bank Corporation Non-Employee Directors Stock Option Plan, is hereby incorporated by reference to the Corporation’s Proxy Statement dated March 10, 1995 and filed with the Commission as Appendix A to the Proxy Statement on March 10, 1995.

(D) The Bryn Mawr Bank Corporation 1998 Stock Option Plan, is hereby incorporated by reference to the Corporation’s Proxy Statement dated March 2, 1998 and filed with the Securities and Exchange Commission as Exhibit A to the Proxy Statement.

(E) Agreement dated January 1, 1999 between Bryn Mawr Brokerage Company, Inc. and UVEST Financial Services Group, Inc., to provide brokerage support services to BM Brokerage is incorporated by reference to the Corporation’s Form 10-K filed with the Securities and Exchange Commission on March 30, 1999.

(F) Lease dated March 1, 1999 between The Bryn Mawr Trust Company and Anthony J. Marcozzi and The Real Viking, Inc. for the property and the buildings known as 2 and 6 Bryn Mawr Avenue. The term of this lease is for an initial period of twenty-nine years with the option to extend for one-ten year period with the same terms and conditions as the initial lease. The lease is hereby incorporated by reference to the Corporation’s Form 10-K, filed with the Securities and Exchange Commission on March 30, 2000.

(G) Employment Agreement dated January 11, 2001 between Bryn Mawr Bank Corporation and Frederick C. Peters II is incorporated by reference to the Corporation’s From 10-K, filed with the Securities and Exchange Commission on March 30, 2001.

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(H) The Bryn Mawr Bank Corporation 2001 Stock Option Plan, is hereby incorporated by reference to the Corporation’s Proxy Statement dated March 8, 2001 and filed with the Securities and Exchange Commission on March 8, 2001 as Appendix B to the Proxy Statement.

(I) Addendum, dated August 15, 2001, to the License agreement between Bryn Mawr Bank Corporation and Fiserv Solutions, Inc. dated December 30, 1994 is incorporated by reference to the Corporation’s Form 10-K, filed with the SEC on March 30, 2002.

(J) Agreement dated January 1, 2002 between The Bryn Mawr Trust Company and Robert L. Stevens, past Chief Executive Officer, to provide consulting services to the Bank through August 4, 2007 is hereby incorporated by reference to the Corporation’s Form 10-Q for the first quarter of 2002, filed with the SEC on May 14, 2002.

(K) Lease dated April 1, 2002 between The Bryn Mawr Trust Company and Radnor Chase Cronies for the property and improvements at 3601 West Chester Pike, Newtown Township, Delaware County, Pennsylvania, is incorporated by reference to the Corporation’s Form 10-K, filed with the Securities and Exchange Commission on March 26, 2003.

(L) Amendment dated August 8, 2002 to the Agreement between Bryn Mawr Brokerage Company, Inc. and UVEST Financial Services, Group, Inc. dated January 1, 1999 and incorporated by reference to the Corporation’s Form 10-K filed with the SEC on March 30, 1999, to include The Bryn Mawr Trust Company as Subscriber to the original contract is incorporated by reference to the Corporation’s Form 10-K, filed with the Securities and Exchange Commission on March 26, 2003.

(M) Letter agreement between The Bryn Mawr Trust Company and John Pickering, dated March 24, 2004, describing the terms of his employment by the Bank.

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(N) Bryn Mawr Bank Corporation 2004 Stock Option Plan is incorporated by reference to the Form S-8, filed with the Securities and Exchange Commission on March 15, 2004.

(O) Master Services agreement dated September 16, 2003, effective August 1, 2004 and an amendment to the master services agreement dated March 2, 2004, between SEI Investment Management Corporation and The Bryn Mawr Trust Company to provide data processing services for the Bank’s trust accounts.

(P) Agreement dated September 16, 2003, effective August 1, 2004, between The Bryn Mawr Trust Company and SEI Private Trust Company, to provide mutual fund clearing services for the Bank’s trust customers.

(Q) Lease dated March 16, 2004 between 100 Brentwood Associates, PPL and The Bryn Mawr Trust Company to lease real property located in Exton PA for the new location of the Bank’s Exton Branch.

13 - Annual Report to Security Holders

The Registrant’s 2004 Annual Report to Shareholders is attached herewith as Exhibit 13.

21 - Subsidiaries of the Registrant

Name	State of Incorporation
The Bryn Mawr Trust Company	Pennsylvania
Bryn Mawr Financial Services, Inc.	Pennsylvania
Bryn Mawr Advisors, Inc.	Pennsylvania
Insurance Counsellors of Bryn Mawr, Inc	Pennsylvania
Bryn Mawr Brokerage Co., Inc.	Pennsylvania
Joseph W. Roskos Co., Inc.	Pennsylvania
Bryn Mawr Asset Management, Inc.	Pennsylvania
BMT Settlement Services, Inc.	Pennsylvania
Bryn Mawr Finance, Inc.	Delaware

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23 - Consent of Independent Registered Public Accounting Firms

.1    -     Consent of KPMG LLP filed herewith as Exhibit 23.1.

.2    -     Consent of PricewaterhouseCoopers LLP filed herewith as exhibit 23.2.

31 - Certification of Annual Report

.1    -     Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

.2    -     Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32 - Certification Pursuant to 18 U.S.C. Section 1350

.1    -     Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

.2    - Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

99 – Additional Exhibits

(A) Registrant’s Proxy Statement for its 2005 Annual Meeting to be held on April 19, 2005, was filed with the Securities and Exchange Commission on March 8, 2005 and is incorporated by reference as Exhibit 99(A).

(B) Report of PricewaterhouseCoopers, independent auditors for years ended December 31, 2003 and 2002, dated February 27, 2004, attached hereto as Exhibit 99(B).

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(b) INDEX TO FINANCIAL STATEMENTS, SCHEDULES AND EXHIBITS

The report of Registered Public Accounting Firm, KPMG LLP, as pertaining to the Consolidated Financial Statements of Bryn Mawr Bank Corporation for 2004 and related notes is incorporated by reference to page 25 of the Corporation’s 2004 Annual Report to Shareholders.

Consolidated Financial Statements and related notes are incorporated by reference to the financial section of the Corporation’s 2004 Annual Report to Shareholders, and may be found on the pages of said Report as indicated in the parenthesis:

Consolidated Balance Sheets, December 31, 2004 and 2003 (page 26)

Consolidated Statements of Income for the years ended December 31, 2004, 2003 and 2002 (page 27)

Consolidated Statements of Comprehensive Income for the years ended December 31, 2004, 2003, and 2002 (page 29)

Consolidated Statements of Changes in Shareholders’ Equity for the years ended December 31, 2004, 2003 and 2002 (page 29)

Consolidated Statements of Cash Flows for the years ended December 31, 2004, 2003 and 2002 (page 28)

Notes to Financial Statements (pages 30 to 43)

Supplementary Data:

Quarterly Results of Operations are incorporated by reference to the information under the caption “Selected Quarterly Financial Data (Unaudited)”, in Note 19 on page 41 of the financial section of the Corporation’s Annual Report to Shareholders for the fiscal years ended December 31, 2004 and 2003.

Financial Statement Schedules are omitted because of the absence of the conditions under which they are required or because the information called for is included in the Consolidated Financial Statements or notes thereto.

Exhibits:

For information regarding exhibits, including those incorporated by reference, see pages 63 through 68 of this report.

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SIGNATURES

Pursuant to the requirements of section 13 or 15d of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized

(Registrant) Bryn Mawr Bank Corporation

By (Signature and Title)  /s/    JOSEPH W. REBL, Treasurer        

Date March 3, 2005

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Corporation and in the capacities and on the date indicated.

NAME	TITLE	DATE
/S/     FREDERICK C. PETERS II         Frederick C. Peters II	Chairman, President and Chief Executive Officer (Principal Executive Officer) and Director	March 3, 2005
/S/     JOSEPH W. REBL         Joseph W. Rebl	Treasurer (Principal Financial and Principal Accounting Officer)	March 3, 2005
Warren W. Deakins	Director	March     , 2005
/S/     ANDREA F. GILBERT         Andrea F. Gilbert	Director	March 3, 2005
William Harral, III	Director	March     , 2005

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NAME	TITLE	DATE
Wendell F. Holland	Director	March     , 2005
/S/     FRANCIS J. LETO         Francis J. Leto	Director	March 3, 2005
/S/     JAMES J. SMART         James J. Smart	Director	March 3, 2005
B. Loyall Taylor, Jr.	Director	March     , 2005
/S/     NANCY J. VICKERS         Nancy J. Vickers	Director	March 3, 2005
/S/     THOMAS A. WILLIAMS          Thomas A. Williams	Director	March 3, 2005

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Commission File No. 0-15261

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES AND EXCHANGE ACT OF 1934

For the Year Ended December 31, 2004

BRYN MAWR BANK CORPORATION

EX-10.(M)

Exhibit 10(m)

The Bryn Mawr Trust Company

March 24, 2004

Mr. John Pickering, II

4133 Hollow Road

Phoenixville, PA 19460

Dear John:

I’m pleased to offer you the position of Executive Vice President and Head of the Wealth Group at The Bryn Mawr Trust Company. In this role you will have full responsibility for the Trust Administration, Custody. Employee Benefits, and Investment Management divisions. In addition, you will be responsible for all of the new business development efforts in the Wealth Group. You will report directly to me and will be an integral part of our Executive Management Committee.

Your initial base salary will be $190,000 per annum. You will have a special bonus plan with an award of up to $100,000 based on revenue growth, net of stock market appreciation. There will be a minimum bonus of $50,000 paid to you for the fiscal years 2004 and 2005.

Upon joining Bryn Mawr Trust you will be granted a 7,500 share option award. Thereafter you will annually receive an option award similar to that given to other members of the Executive Management Committee. That figure this year was 10,000 shares. Please note that under our current plan, options vest over a three year period.

You will have all benefits which are received by members of the Executive Management Committee including medical, disability, life insurance, and a Change-of-Control agreement. After six months you will be eligible for the 401 (k) program.

John, all of us at Bryn Mawr Trust are excited that you are becoming part of our organization. I know that you will be a valuable contributor to our future success.

With best wishes,

Sincerely,

/s/ TED PETERS

INVESTMENT MANAGEMENT • FINANCIAL PLANNING • TAX PLANNING • PERSONAL BANKING • BUSINESS BANKING

BROKERAGE SERVICES • FOUNDATIONS • FAMILY OFFICE • INSURANCE • MORTGAGES • FIDUCIARY SERVICES

801 Lancaster Avenue, Bryn Mawr, Pennsylvania 19010 • 610-581-4806 • FAX 610-526-2051

EX-10.(O)

Exhibit 10(o)

MASTER SERVICES AGREEMENT

This Master Services Agreement (this “Agreement”) dated as of September 16, 2003 (“Effective Date”) is made by and among The Bryn Mawr Trust Company, a Pennsylvania charted bank and a subsidiary of Bryn Mawr Bank Corporation, having its principal place of business at 801 Lancaster Ave, Bryn Mawr, PA 19010 (“Customer”) on the one part, and SEI Investments Management Corporation (“SIMCO”), a Delaware corporation, having its principal place of business at One Freedom Valley Drive, Oaks, Pennsylvania 19456-1100 and SEI Private Trust Company (“SEI Trust”), a limited purpose federal savings bank regulated by the Office of Thrift Supervision, having its principal place of business at One Freedom Valley Drive, Oaks, Pennsylvania 19456 on the other part (SEI Trust and SIMCO may be collectively referred to as “SEI”).

WHEREAS, SIMCO is a provider of trust processing and reporting services through, among other things, use of its proprietary trust accounting system, “Trust 3000 System” or “Trust 3000 Service”;

WHEREAS, Customer desires to obtain such services from SIMCO to provide such services to its clients;

WHEREAS, Customer desires that certain securities, as hereinafter specified in Exhibit I attached hereto, will be hereinafter held and administered by SEI Trust; and

WHEREAS, SEI Trust desires to accept appointment as custodian of such securities and cash held by Customer for the accounts of its customers.

WHEREAS, SEI is the provider of certain licensed products to be used in conjunction with the Trust 3000 System.

NOW THEREFORE, in consideration of the premises, and the covenants, representations and warranties contained herein, and intending to be legally bound hereby, SEI and Customer agree as follows:

SECTION 1 — SERVICES PROVIDED.

1.01 TRUST 3000 Service. Subject to the terms and conditions of this Agreement, SEI agrees to provide Customer and Customer agrees to purchase the use of the TRUST 3000 Service for all of its trust accounts. As used herein, the terms “TRUST 3000 System” or the “TRUST 3000 Service”, shall mean those aspects of SEI’s computer processing services and related materials specified in Exhibit A attached hereto.

1.02 Data Center Access. Subject to the terms and conditions of this Agreement, SEI further agrees to provide to Customer and Customer agrees to purchase the services relating to access to SEI’s data center that are specified in Exhibit B attached hereto (“Data Access Services”). In consideration for the Data Access Services, Customer shall pay to SEI the fees specified in Exhibit B.

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1.03 Licensed Products. SEI hereby grants to Customer during the Term a non-exclusive, personal limited license to use the Licensed Products solely in connection with the Accounts and the Services contemplated by this Agreement. Except as otherwise may be set forth in Exhibit D (Licensed Products), Customer shall not sublicense, assign, lease, distribute, or otherwise transfer the Licensed Products or Customer’s right to use the Licensed Products to any other Person. Additional provisions relating to the Licensed Products are set forth in Exhibit D (Licensed Products).

1.04 Employment of Custodian. Subject to the terms and conditions of this Agreement, SEI Trust agrees to provide Customer, and Customer agrees to purchase, the Custody Services listed in Exhibit I (Custody Services). SEI Trust may provide Custody Services through one or more subcustodians appointed by SEI Trust; provided, however, that SEI Trust shall remain responsible for the actions and omissions of any subcustodians.

SECTION 2 — TERM OF AGREEMENT.

2.01 Initial Term. The Initial Term of this Agreement shall commence on the date first written above (“Effective Date”) and shall conclude at the expiration of five Contract Years, which year shall commence on the date Customer first processes its trust accounts in a live, commercial production service bureau environment in the course of its business, on the TRUST 3000 System (“Cutover Date”). As used in this Agreement, the term “Contract Year” means, with respect to the first Contract Year, the period commencing on the Effective Date and ending on the date immediately preceding the first anniversary of the Cutover Date; and with respect to the second and subsequent Contract Years, the twelve month period commencing on the applicable anniversary of the Cutover Date.

2.02 Extension Terms. This Agreement shall automatically remain in full force and effect for a three year extension term (“Extension Term”), and for succeeding three year Extension Terms thereafter, unless the Agreement is terminated as provided in Section 2.03 hereof. Each Extension Term shall be on the same terms and conditions as were applicable during the Basic Term, with respect to the first Extension Term, and the immediately preceding Extension Term, with respect to the second and any subsequent Extension Term, except as such terms and conditions are modified pursuant to the provisions of this Agreement. “Term” shall mean the Initial Term and any applicable Extension Terms. In the event that Customer provides timely notice of termination of the Initial Term or any Extension Term but is unable to timely deconvert from the Trust 3000 System (a “Holdover”) for a period not to exceed nine months from the date of the expiration of the then-current term, for SEl’s continued provision of trust processing, reporting and custody services regarding such Holdover, Customer agrees to pay SEI for such services such fees as in effect immediately before such Holdover. The foregoing shall not limit SEI’s right to further increase such fees as set forth in Section 3 of this Agreement. In the event that Customer remains unable to deconvert from the system within such nine month period then, such Holdover shall be treated as an Extension Term under the Agreement.

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2.03 Termination.

(a) Termination at the End of an Existing Term. Customer or SEI may elect to terminate this Agreement on the last day of the Basic Term or any Extension Term by notifying the other party in writing, not less than two hundred seventy days prior to the last day of such basic term or extension term, as applicable, of its intention to so terminate this Agreement.

(b) Termination for Convenience. Customer may terminate this Agreement at any time in its discretion in accordance with the terms and conditions of this Section 2.03(b), hereafter called a “Termination for Convenience.” In order to exercise its right of Termination for Convenience, Customer shall (i) give written notice of exercise to SEI, which notice shall specify an effective date of the Termination for Convenience, which date shall not be less than one hundred eighty days after the date that SEI receives the notice of exercise, (ii) not be in material breach of this Agreement at the time it gives such notice of exercise or immediately prior to or on the effective date of the Termination for Convenience, and (iii) pay to SEI (A) at the same time that Customer gives SEI its notice of exercise, an amount equal to fifty percent of the Buyout Amount (defined below), and (B) at least ninety days before the effective date of the Termination for Convenience, an amount equal to fifty percent of the Buyout Amount. As used herein, the term “Buyout Amount” means the amount calculated pursuant to the following steps:

(1) the amount of: the monthly average of the processing services fees described on Exhibit A which Customer has paid for the six months prior to the date of Customer’s notice of termination (if Customer gives notice of termination prior to the Cutover Date, the Minimum Monthly Software and Processing Services Fee set forth on Exhibit A shall be applicable under this clause; and if Customer gives notice of termination after the Cutover Date but at a time when Customer has not been on the TRUST 3000 System for at least six months, the monthly average of the processing services fees described on Exhibit A which Customer has paid for the entire period prior to the date of Customer’s notice of termination shall be applicable under this clause;

(2) multiplied by the number of months remaining from the effective date of termination to the end of the then existing term (including any extension term to which the parties have then committed) whether the basic term or an extension term.

(3) The dollar amount determined by multiplying subsection (1) by subsection (2) above shall be discounted for the time value of money for the period of time commencing at the time of payment of sums described in Section 2.03 (b) above, until the end of the then existing term of this Agreement (including any extension term to which the parties have then committed), at an interest rate equal to the “Federal Funds” rate set forth in the “Money Rates” table in The Wall Street Journal on the date of Customer’s notice of exercise of its right of Termination for Convenience.

(4) In addition to the Buyout Amount, Customer shall pay SEI for (A) the charges set forth in Section 2.04, (B) any termination fees imposed by third parties, (C) telecommunication charges, (D) any services used prior to the effective date of termination, but

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which have not yet been invoiced, and (E) any deconversion services which Customer may request.

(c) Termination for Cause By Customer. Customer may terminate this Agreement in the event (i) that a material breach by SEI in the performance of its obligations under this Agreement occurs that results in Customer experiencing a material deprivation of services under this Agreement and SEI fails to cure such breach within ninety days after SEI’s receipt of Customer’s written notice of breach. If Customer terminates this Agreement under this Section 2.03(c), Customer shall have no obligation to pay SEI the Buyout Amount, but Customer shall be obligated to pay the other amounts specified in Sections 2.03(b)(4) and 2.04.

(d) Termination for Cause By SEI. If Customer defaults in the payment of any fees, charges or other amounts due under this Agreement and fails to cure such default within thirty days after receiving notice thereof from SEI, SEI may terminate this Agreement effective as of the date specified in such notice. In addition, SEI may terminate this Agreement in the event Customer materially breaches this Agreement (other than a breach of its payment obligations, which is covered by the previous sentence) and fails to cure such breach within 90 days after Customer’s receipt of SEI’s written notice of breach. If SEI terminates this Agreement pursuant to this Section 2.03(c)(ii), Customer shall be obligated to pay to SEI the Buyout Amount and the other amounts specified in Sections 2.03(b) and 2.04.

2.04 Obligation upon Expiration or Any Termination of Agreement. Customer shall return (or destroy if it certifies in writing to SEI that it has so destroyed) all user documentation and all other data and related materials and all Proprietary Information (defined in Section 4.03 below) provided to Customer by SEI hereunder upon expiration or any termination of this Agreement. In addition, Customer will be obligated to pay those fees as specified below. Upon expiration or any termination of this Agreement as set forth in this Section 2, upon Customer request, SEI will provide Customer with one set of computer-generated ledger sheets for each account then on the TRUST 3000 Service on magnetic tapes in a form sequentially accessible. Customer will bear the expense for SEI to create the magnetic media in the standard format, as determined by SEI in accordance with the provisions of Exhibit C attached hereto. SEI will also provide the file formats for each file generated. In addition, Customer acknowledges SEI invoices for Third Party Services, telecommunication, and services which are calculated based upon Customer consumption, up to ninety days after services are rendered. Customer will be obligated to reimburse SEI for any such charges incurred by SEI on Customer’s behalf for a period of ninety days following the later of (i) expiration or any termination of this Agreement or (ii) Customer’s cessation of any use of the TRUST 3000 System for processing and or retrieval purposes. Upon Customer’s request, after expiration or any termination of this Agreement, SEI will provide Customer access to the data described on Exhibit C hereto at the fees indicated on such schedule.

2.05 Survival of Obligations. No termination of this Agreement shall affect the rights or obligations of either party which have arisen or accrued before termination. The provisions of this Agreement which by their terms, intent or purposes are intended to survive the termination

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hereof, shall survive the termination of this Agreement including but not limited to Sections 3, 4.03, 4.05, 5.01, 5.03, 6.02, 6.03, 8 and 9 shall survive the termination of this Agreement.

SECTION 3 — PAYMENT OF FEES AND OTHER EXPENSES.

3.01 Fees. Customer agrees to pay SEI the fees set forth in this Agreement for the use of the TRUST 3000 System and for any equipment and maintenance or other products or services provided by SEI, including but not limited to the Licensed Products and Custody Services, under this Agreement, as such fees may be adjusted from time to time pursuant to Section 3.03 below. Customer agrees to pay SEI all fees for each month commencing on the Cutover Date, each such payment to be due thirty-five days after the date of invoice. Customer agrees to pay interest on all amounts past due at the highest rate permitted by applicable law, but not greater than one and one-half percent per month.

3.02 Taxes. Customer agrees to pay all state and local sales, use, property or other taxes, with respect to this Agreement, the TRUST 3000 System or any equipment, product or services provided hereunder which may be assessed against SEI or Customer; provided, however, Customer shall not be liable for taxes on SEI’s property or net income, gross receipts or corporate franchise. At its option, SEI may include applicable taxes in its invoices in which event Customer shall pay to SEI the taxes so invoiced. In the event Customer shall supply SEI with an applicable exemption certificate, issued by an applicable state governing authority, SEI shall not invoice Customer for such taxes.

3.03 Adjustment of Fees. Customer agrees that at any time after the end of the first Contract Year, SEI may increase the Fees upon thirty days written notice to Customer, in an amount not to exceed the percentage increase in the Consumer Price Index (“CPI”)–All Factors, as measured by the Bureau of Labor Statistics, since the Effective Date of this Agreement, with respect to the first increase, and since the date of the last increase, with respect to the second and any subsequent increases, but in no event shall there be more than one increase in any twelve month period. Notwithstanding the above, in the event of an increase to SEI’s costs for Third Party Services, SEI may at any time upon thirty days written notice increase the Fees applicable to such Third Party Services, provided, that such fee increase will not exceed the applicable percentage increase in costs incurred by SEI with respect to such Third Party Services.

SECTION 4 — COVENANTS OF CUSTOMER.

4.01 Limitations on Use of TRUST 3000 System. Customer agrees that it shall not permit the TRUST 3000 Service to be used by or for any person or entity except Customer and the corporations which are wholly-owned directly or indirectly by Customer, its parent listed below, or its Designated Affiliates as listed in Exhibit L. In addition, customers of Customer may have access to the system for retrieval and limited processing purposes under any reasonable third party access procedures implemented by SEI. The fees for third party access are listed in Exhibit A.

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Name of Corporation	Relationship to Customer
Bryn Mawr Bank Corporation	Holding Company

In the event Customer or any of the entities listed above acquires (by merger, asset purchase or otherwise) any entity not listed above or trust assets of any entity not listed above, or in the event Customer wishes to use the TRUST 3000 System for any of its current affiliates not listed above (collectively, “New Entity”), Customer may use the TRUST 3000 System for the New Entity, after notifying SEI of its intention to do so and in accordance with the terms, conditions and prices then applicable under this Agreement; provided, however, if the services to be provided to such New Entity are materially different in character from those then being provided to Customer or impose materially different obligations on SEI then the parties will mutually agree on an adjustment to the fees with respect to such New Entity to reflect any such differences.

4.02 Equipment. Customer shall be responsible for obtaining and maintaining network compatible terminal, print and telecommunication equipment for use in conjunction with the TRUST 3000 System. SEI shall not be liable for any damages caused by Customer’s use of such equipment.

4.03 Proprietary Rights. Customer agrees and acknowledges that: the TRUST 3000 System, and related documentation, together with all other data and materials, all software codes, trade secrets, design concepts, discoveries, ideas, enhancements, improvements and inventions related thereto supplied by SEI to Customer pursuant to this Agreement, and the terms, conditions and provisions set forth in this Agreement (collectively, the “Proprietary Information”), and any and all intellectual property rights inherent in the any of the foregoing and any portion thereof and appurtenant thereto including, without limitation, all patent rights, copyrights, trademarks, know-how and trade secrets (collectively, “Intellectual Property Rights”): (a) are the exclusive property of SEI and shall remain so; and (b) are confidential and proprietary trade secrets of SEI, protected by law, and of substantial value to SEI, and may not be used or disclosed without the written consent of SEI. Customer shall retain in strict confidence the Proprietary Information, shall not disclose the Proprietary Information to others, except (i) to those of its employees and consultants who have a need to know such Proprietary Information in connection with the performance of the scope of their employment or engagement by Customer; provided, however, that as a condition to Customer disclosing any Proprietary Information to any such consultant, the consultant shall have entered into a confidentiality agreement with Customer pursuant to which the consultant shall have agreed to keep the Proprietary Information strictly confidential and not to use the Proprietary Information other than in connection with the performance of the scope of his or her engagement by Customer (such employees and consultants are referred to herein as “Permitted Employees and Consultants”), and (ii) as may be required by audit or as may otherwise be required by law, and shall use the Proprietary Information solely in connection with this Agreement. To the extent any regulatory authority or governmental agency, specifically including the federal and state judiciary systems (collectively: “Governing Authorities”) shall request that Customer reveal any of the Proprietary Information, or to the extent that Customer otherwise determines that it is required by law to disclose any of the Proprietary Information, Customer shall, prior to the release or disclosure of such Proprietary Information, provide SEI with prompt notice of such request or determination, to enable SEI to

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formally contest the release of such Proprietary Information to such Governing Authority or to request confidential treatment of such Proprietary Information. Customer agrees at SEI’s expense, to provide reasonable assistance to SEI in its preparation and filing of such contest or request. Customer agrees to keep all property of SEI free and clear of all claims, liens and encumbrances. The TRUST 3000 System hereunder shall only be used by Customer to process its own data, and, except as provided in Section 4.01 hereof, shall not be used for or on behalf of others. Customer shall not create or attempt to create, nor permit others to create or attempt to create, the TRUST 3000 System or any part thereof. In addition, Customer agrees to preserve any copyright and trade secret notices of SEI on materials where such notices appear. Customer shall immediately notify SEI of the unauthorized possession, use or knowledge of any item supplied to Customer pursuant to this Agreement. In the event Customer breaches or attempts to breach any of the provisions of this Section 4.03, SEI shall have the right, in addition to such other remedies which may be available to it, to injunctive relief enjoining such breach or attempt to breach, it being hereby agreed by Customer that legal remedies are inadequate for any breach or attempted breach hereof. The provisions of this Section 4.03 shall survive the termination of this Agreement.

4.04 Limitation on Use of Materials. Customer shall not copy or reproduce in any manner any manuals, user documentation or other materials provided by SEI to Customer under this Agreement except for copies made by Customer solely for its internal use by Permitted Employees and Consultants, and except for two copies made for off-site disaster recovery purposes.

4.05 Custom Work, Ownership of Custom Work.

(a) Definition of Custom Work. As used herein, the term “Custom Work” means any and all custom programming, custom coding, custom software, custom interfaces, consulting and custom statements which SEI shall create at Customers request and expense. The word “custom” as used herein means work which was created for Customer to meet Customer’s business needs. The initial standard FTI interface file extract provided by SEI on a daily basis to Customer, an example of which is detailed in Exhibit A, and the initial Customer Employee Benefit Statement (“EBS”) are deemed to be Custom Work, however, no fees will be charged to Customer for such services. SEI will use its best efforts to provide Customer a sample EBS mock-up for approval prior to the dress rehearsal, as well as, a sample EBS containing Customer’s data after the dress rehearsal. SEI reserves the right to charge Customer a fee in the event that Customer requests any modification to the initially provided standard FTI interface file extract and/or the initial EBSs.

(b) Custom Work Ownership Issues. The parties mutually acknowledge and agree SEI shall own all right, title, and interest in any Custom Work developed by SEI under the terms of this Agreement including, without limitation, any and all Intellectual Property Rights inherent in the Custom Work and any portion thereof and appurtenant thereto.

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SECTION 5 — COVENANTS OF SEI.

5.01 Confidentiality of Customer Information.

(a) Definition of Customer Information. “Customer Information” means: (i) all information and data relating to Customer’s or Customer’s Affiliates’ accounts; (ii) all information collected by SEI from Customer or otherwise provided to SEI in connection with the performance of SEI duties under this Agreement for Customer; (iii) all information regarding Customer’s customers, customer accounts, customer names, addresses, social security numbers or any other personal identifier, or any information derived therefrom; (iv) all strategic plans and marketing plans of Customer revealed to SEI; and (v) any and all other information which has been communicated to SEI and received by SEI by reason of its nature, source, use, or other sensitivity would ordinarily be considered the confidential and proprietary information of Customer.

(b) Use and Disclosure of Customer Information. SEI agrees that Customer Information is the exclusive property of Customer. SEI agrees that during the term of this Agreement and thereafter, SEI shall not make known, divulge, or communicate to any person or entity information concerning such Customer Information, or Customer, except as may be required to perform its services under this Agreement, to maintain the TRUST 3000 System, or as may be required by audit or as may otherwise be required by law. Further, SEI agrees that it will not use the confidential information for any purpose other than to provide the services contemplated by this Agreement. SEI shall promptly notify Customer of the unauthorized disclosure or use of Customer Information.

(c) Compliance with Gramm-Leach-Bliley Act. In connection with the activities contemplated by this Agreement, each of SEI and Customer shall comply with all applicable provisions of the Gramm-Leach-Bliley Act (as such Act may be amended from time to time), including, without limitation, applicable provisions regarding the sharing, disclosure, safeguarding and/or security of Nonpublic Personal Information (as such term is defined in the Gramm-Leach-Bliley Act). SEI will regularly perform tests on its security policy and procedures and will certify upon Customer’s request its compliance with such policy and procedures. SEI will use its best commercial efforts to rectify any deficiencies found during the regular testing of such security policy and procedures.

(d) Confidentiality Agreements. SEI agrees to enter into confidentiality agreements with its employees, agents, representatives, subcontractors, Third Party Vendors or any other party to whom SEI may provide access to or disclose Customer Information, to comply with all the provisions of this Section 5.01.

(e) Exclusions From Definition of Customer Information. Notwithstanding anything contained above in this Section 5.01 to the contrary, Customer Information shall not include information which:

(i) is now or hereafter becomes available to the public without a breach by SEI of the terms of this Agreement, but only to the extent the Customer Information becomes available to the public; or

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(ii) was known to and documented in writing in the possession of SEI before its disclosure hereunder; or

(iii) becomes available to SEI without restrictions on its use or further disclosure; or

(iv) is independently developed by SEI; or

(v) is disclosed pursuant to judicial action, provided SEI shall give at least ten (10) days written notice to Customer of the request for disclosure in a judicial action and no suitable protective order, or equivalent remedy is available. This information is no longer Customer Information only to the extent disclosed by the judicial action and subject to the restrictions ordered by the court.

5.02 Security Precautions. SEI agrees to follow file, safekeeping, and backup procedures that may be required of SEI by applicable law or rule or regulation of the Federal Deposit Insurance Corporation, the Comptroller of the Currency or the Federal Reserve Board, as submitted to SEI by Customer. Each business day, SEI will prepare and preserve magnetic media containing Customer’s data to preclude the following data loss problems: (i) the inability to read or (ii) actual loss of the data at SEI’s data center. SEI agrees to save Customer’s data as provided in Exhibit E attached hereto. SEI shall maintain throughout the Term of this Agreement a disaster recovery plan (the “Disaster Recovery Plan”) in compliance with applicable regulatory requirements. The Disaster Recovery Plan shall comply with the provisions of Exhibit F (Disaster Recovery).

5.03 Provision of Services by Others. It is understood that SEI reserves the right to either provide itself the services contemplated by this Agreement to be provided by SEI (which include all services other than the Third Party Services) or to engage another party to perform such services. Except as provided in Section 6.03 with respect to Third Party Services, Customer understands that SEI has sole responsibility and liability, subject to the limitation of liability set forth in this Agreement, for furnishing the services contemplated by this Agreement, and any other agreement between Customer and SEI; and Customer hereby irrevocably agrees that (a) Customer shall look solely to SEI for the performance of any such services in accordance with the provisions of this Agreement or such other agreement, and (b) third parties providing any such services, whether as supplier, agent or subcontractor, shall have no liability to Customer for such services.

5.04 Access by Customer. SEI will grant the internal auditors of Customer and other personnel authorized by Customer reasonable access to SEI’s premises, and to books and records related to the provision of services contemplated by this Agreement. SEI agrees to grant federal and other governmental and banking agencies, when required by law or authorized by Customer,

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access to records of Customer held by SEI. SIMCO shall during the Term provide Customer on an annual basis with the latest version of the SAS #70 upon such reasonable terms and conditions as SIMCO may generally make such report available to its clients. In addition, SEI Trust shall during the Term provide Customer on an annual basis with the latest version of the SAS #70 Report (Type II) regarding SEI Trust’s operations upon such reasonable terms and conditions as SEI Trust generally makes such report available to its clients.

5.05 Legislative Enhancements. Modifications required to be made to the TRUST 3000 System in order to comply with changes in applicable federal laws or regulations will be made available to Customer. Each such change shall be made and implemented as soon as practicable. Customer shall notify SEI promptly in writing of any such modifications requested by client. The development of new software modules or major changes to existing software modules required to comply with federal laws or regulations will be made available to Customer at a price equal to the total time and materials required to implement such changes prorated (based on number of accounts serviced by SEI) among all affected customers. Major change(s) pursuant hereto shall mean those changes whose total costs exceed five percent (5%) of SEI Trust’s gross annual revenues in any such year.

5.06 Implementation Services. SEI and Customer are parties to an Implementation Services Agreement dated as of the date hereof (the “Implementation Agreement”), pursuant to which, among other things, SEI agrees to provide, and Customer agrees to pay for, services necessary to implement the TRUST 3000 Service for Customer. A true and complete copy of the Implementation Agreement is attached hereto as Exhibit G.

5.07 Performance Standards. SEI agrees to use commercially reasonable efforts to perform the services hereunder in accordance with the Performance Standards attached hereto as Exhibit H (“Performance Standards”).

SECTION 6 — WARRANTY.

6.01 Warranty. SEI hereby warrants as follows: (a) it owns the TRUST 3000 System or has a valid license to such portion of the system not owned by it, (b) the TRUST 3000 System will perform materially as described in its documentation, and (c) the generic interface extracts will materially conform to the specifications provided to FTI, as described in Exhibit A, Subsection III, FTI.

Except as stated in the previous sentence, SEI MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE TRUST 3000 SYSTEM OR ANY PRODUCT OR SERVICE PROVIDED HEREUNDER, ITS MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

6.02 Remedy for Breach. SEI agrees to hold harmless and defend Customer from any claims brought against Customer based upon a defect in SEI’s title to, or power to grant to Customer the use of, the TRUST 3000 System or any trademark, patent or copyright

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infringement with respect to the TRUST 3000 System. If any claim is brought for which SEI may be liable under this Section 6.02, Customer shall give SEI reasonable notice of such claim. SEI shall have full control in the defense of such claim and Customer shall cooperate with SEI to enable SEI to defend such claim, at SEI’s expense, in SEI’s and/or Customer’s name. In the event that Customer is unable to use the Trust 3000 System because of any claim of infringement, SEI will use its best efforts to provide a replacement, comparable system. In the event that SEI is unable to provide such a replacement system then, Customer may terminate this Agreement.

6.03 Third Party Services. SEI agrees to provide to Customer certain services from external third party sources (“Third Party Vendors”). Such services (“Third Party Services”) and the associated prices to be initially paid by Customer therefore are listed in Exhibit A attached hereto. To the extent any Third Party Services are provided by SEI to Customer hereunder, Customer agrees that such services are confidential and proprietary trade secrets of the respective Third Party Vendors. Accordingly, Customer agrees to honor requests by SEI and Third Party Vendors to protect their proprietary rights in such data, including requests that Customer place copyright notices or other proprietary legends on printed matter, print-outs, tapes, disks, film or any other medium of dissemination. Customer further agrees that all Third Party Services are provided by the Third Party Vendors on an “AS IS WITH ALL FAULTS” basis for Customer’s internal use. Customer may use Third Party Services as normally required on statements, reports, screens and other documents necessary to support Customer’s clients, however Customer shall not distribute any Third Party Services to other third parties. The Third Party Vendors MAKE NO WARRANTIES, EXPRESS OR IMPLIED, AS TO MERCHANTABILITY, FITNESS, OR ANY OTHER MATTER with respect to any of the Third Party Services or any such products. SEI MAKES NO WARRANTIES, EXPRESS OR IMPLIED, AS TO MERCHANTABILITY, FITNESS, OR ANY OTHER MATTER with respect to any of the Third Party Services or any such products. Neither SEI nor the Third Party Vendors shall be liable for any damages suffered by Customer in the use of any of the Third Party Services, including liability for any incidental, consequential or similar damages.

SEI DOES NOT MAKE ANY WARRANTY OR REPRESENTATION REGARDING THE AVAILABILITY, RELIABILITY, SECURITY OR OPERATION OF THE INTERNET. IN ADDITION, SEI IS NOT RESPONSIBLE FOR ANY FAILURE OF ANY SEI PRODUCTS OR SERVICES ACCESSED VIA THE INTERNET DUE TO THE AVAILABILITY, RELIABILITY, SECURITY OR OPERATION OF THE INTERNET.

SECTION 7 — AUTHORIZATIONS

7.01 Instructions, Notices and Authorized Persons.

a. As used in this Agreement, the terms “Instructions” or “Instructed” mean:

1. a written Customer request, which is signed by two persons authorized in Customer’s corporate resolution to issue such requests, which is delivered to SEI in paper form or through facsimile transmission; or

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2. a written Customer request which is issued by a person authorized in Customer’s corporate resolution to issue such requests, which is communicated to SEI through the electronic process of affirmation of trades; or

3. In the event of a technical breakdown of the facsimile capability at the site of Customer or SEI, SEI may accept an oral request or order issued by two persons who are authorized by Customer in Customer’s corporate resolution to issue such instructions, providing such persons shall identify themselves with identification codes. Such oral instructions issued specifically in such manner shall hereafter be called: “Oral Instructions”.

b. Customer agrees within thirty (30) days of the Effective Date of this Agreement to complete and execute the Secretary’s Certificate attached hereto as Exhibit J, wherein Customer shall designate in writing those persons authorized to issue Instructions as set forth above.

c. Any notices, confirmations and receipts required hereunder to be delivered by SEI to Customer, unless otherwise specifically provided, will be delivered by SEI to Customer or by way of data generated by the Trust 3000 System and accessed at Customer’s site or delivered by SEI to Customer. Customer will certify to SEI, as required, the names of the persons who, from time to time, have been duly appointed to act for Customer.

d. Customer will from time to time, file with SEI a certified copy of a Corporate Resolution authorizing person or persons to give proper instructions and specifying the class of instructions that may be given by each person to SEI under this Agreement, as set forth in Exhibit J.

e. Subject to this Section 7.01, Customer agrees SEI may rely upon Instructions and Customer forever releases SEI from all liability which may arise in the course of SEI acting upon any Oral Instructions or written (including electronic and fax) Instructions which SEI has appropriately validated. Customer shall indemnify and hold SEI harmless for any action taken (or not taken) by SEI pursuant to any Instruction, direction, or other information communicated to SEI by Customer.

7.02 Use of Securities Depository or Book Entry System.

a. As used herein, the term “Assets” means all Securities and cash held on behalf of Customer and registered in the account of SEI Trust or SEI Trust’s subcustodian in securities depositories – including, but not limited to, the Depository Trust Company (“DTC”) and Participant Trust Company (“PTC”) - and book entry systems - including, but not limited to the Federal Reserve book-entry system.

b. SEI Trust may use Securities depositories or book entry systems to hold, receive, exchange, release, deliver and otherwise deal with Securities (including rights and

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other items of like nature), to receive and to remit to SEI Trust all income and payments thereon. In addition SEI Trust may take all steps necessary and proper in connection with the collection thereof.

c. SEI Trust may register Securities in the name of any nominee or nominees used by securities depositories or book entry systems.

d. SEI Trust may provide payment for Securities purchased and sold through the clearing medium employed by securities depositories or book entry systems for transactions or participants acting through it.

e. Subject to security requirements of SEI Trust, all books, records and information technology systems maintained by SEI Trust which relate to Customer’s and its Client Base’s participation in securities depositories or book entry systems will at all times during SEI Trust’s regular business hours be open to inspection by Customer’s duly authorized employees, agents or governmental regulators, and Customer will be furnished with all the information in respect to the services rendered for Customer and its Client Base as Customer’s authorized representatives, auditors and governmental regulators may require.

SECTION 8 — LIMITATION OF LIABILITY.

8.01 Limitation of Liability. Excepting the covenants contained in Section 6.02 (Infringement) and the services provided pursuant to Exhibit I (Custody Services), and any claims for damages arising out of any fraud or willful misconduct on the part of SEI, its agents, officers and directors or employees, SEI’s liability to Customer for damage suffered by Customer (a) in the use of the TRUST 3000 System or other products or services provided by SEI under this Agreement, or (b) as a result of any breach of any of the provisions of this Agreement, shall be limited to the correction of any incorrect reports and monetary damages not to exceed six month’s of processing fees payable hereunder. IN NO EVENT SHALL SEI BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, CONSEQUENTIAL OR SIMILAR DAMAGES OF ANY KIND INCLUDING WITHOUT LIMITATION, LOSS OF PROFITS, LOSS OF BUSINESS OR INTERRUPTION OF BUSINESS, WHETHER SUCH LIABILITY IS PREDICATED ON CONTRACT, STRICT LIABILITY OR ANY OTHER THEORY, AND REGARDLESS OF WHETHER SEI IS ADVISED OF THE POSSIBILITY OF ANY SUCH DAMAGES.

8.02 Notwithstanding any other provision of this Agreement to the contrary, no liability of any kind will be attached to or incurred by SEI by reason of its provision of Custody Services or other obligations under Exhibit I, except only for its own negligence, gross negligence or willful misconduct in performance of its obligations hereunder. In addition, SEI shall be liable with respect to corporate actions only to the extent such corporate actions are reported in the services that SEI monitors.

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SECTION 9 — GENERAL PROVISIONS.

9.01 Notice. Any and all notices required or permitted in connection with this Agreement shall be in writing and shall be delivered by hand, sent by a nationally recognized express delivery service that provides a receipt or sent via certified or registered mail, return receipt requested. All such notices shall be delivered, sent or mailed to the addresses set forth below or to such other address as either party may from time to time designate in writing:

If to SIMCO:	If to Customer:
SEI Investments Management Corporation	Bryn Mawr Trust Company
One Freedom Valley Drive	330 E. Lancaster Avenue
Oaks, Pennsylvania 19456-1100	Wayne, PA 19087
Attn.: General Counsel	Attn: June M. Falcone
If to SEI Trust:
SEI Private Trust Company
One Freedom Valley Drive
Oaks, Pennsylvania 19456-1100
Attn.: General Counsel

9.02 Counterparts. This Agreement may be executed in any number of counterparts and any party hereto may execute any such counterpart, each of which when executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute but one and the same instrument.

9.03 No Third Party Beneficiary. This Agreement is for the mutual and exclusive benefit of SEI and Customer and shall not be deemed to be for the direct or indirect benefit of the customers of SEI or Customer. The customers of SEI and Customer shall not be deemed to be third party beneficiaries of this Agreement or have any other contractual relationship with SEI or Customer by reason of this Agreement and each party hereto agrees to indemnify and hold harmless the other party from any claims of its customers, or its affiliates’ customers, against the other party including any attendant expenses and attorneys’ fees, based on this Agreement or the services provided hereunder.

9.04 Assignment. Customer shall have the right to assign or delegate all or part of its rights, responsibilities or duties hereunder to its parent or any wholly-owned subsidiary of Customer listed in Section 4.01 upon the provision of prior written notice to SEI, but no such assignment shall relieve Customer of its payment obligations hereunder. Such assignment shall be valid only so long as the assignee remains the parent of Customer or a wholly-owned subsidiary of Customer. SEI shall have the right to assign or delegate all or part of its rights, responsibilities or duties hereunder to SEI Investments Company or any wholly-owned direct or indirect subsidiary of SEI Investments Company, upon the provision of prior written notice to Customer. Any other assignment, transfer or delegation by either party (including, without limitation, any assignment, transfer or delegation by operation of law in connection with a merger or otherwise) hereto shall require the prior written approval of the other party hereto which approval shall not be unreasonably withheld or delayed.

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9.05 Force Majeure. Neither Customer nor SEI shall be liable for a failure to comply with the terms hereof, other than payments, where such failure is due to causes beyond its reasonable control.

9.06 Governing Law. This Agreement shall be governed and construed in accordance with the laws of the Commonwealth of Pennsylvania, without giving effect to the choice of laws principles of such state.

9.07 Headings. All section headings contained in this Agreement are for convenience of reference only, do not form a part of this Agreement and shall not affect in any way the meaning or interpretation of this Agreement.

9.08 Contents of Agreement. This Agreement (which includes the Exhibits and any Schedules attached hereto) sets forth the entire understanding of the parties hereto with respect to the subject matter hereof and the transactions contemplated hereby. This Agreement shall not be amended or modified except by written instrument duly executed by each of the parties hereto. Any and all previous agreements and understandings between the parties regarding the subject matter hereof and the transactions contemplated hereby, whether written or oral, are superseded by this Agreement.

9.09 Waiver. Any term or provision of this Agreement may be waived at any time by the party entitled to the benefit thereof by written instrument executed by such party. No failure of either party hereto to exercise any power or right granted hereunder, or to insist upon strict compliance with any obligation hereunder, shall constitute a waiver of the rights of such party to demand full and exact compliance with the terms of this Agreement.

9.10 Severability. In the event that any provision of this Agreement shall be found in violation of public policy or illegal or unenforceable in law or equity, such finding shall in no event invalidate any other provision of this Agreement.

9.11 Insurance. SEI will maintain insurance coverage, including Fidelity Bond coverage, from reputable carriers at all times during the term of this Agreement. Upon the reasonable request of Customer, SEI will furnish Customer with proof of such insurance provided that Customer shall not request such proof more often than annually.

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EACH PARTY HERETO ACKNOWLEDGES THAT SUCH PARTY RESPECTIVELY HAS READ THIS AGREEMENT, UNDERSTANDS ITS TERMS, AND AGREES TO BE LEGALLY BOUND HEREBY.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective duly authorized officers, and have duly delivered this Agreement as of the date first set forth above.

THE BRYN MAWR TRUST COMPANY		SEI INVESTMENTS MANAGEMENT CORPORATION
By:	/S/    JUNE M. FALCONE	By:	/S/    ROBERT F. CRUDUP
Name:	June M. Falcone	Name:	Robert F. Crudup
Title:	Sr. Vice President	Title:	Executive Vice President
SEI PRIVATE TRUST COMPANY
By:	/S/    CARL BECHDEL
Name:	Carl Bechdel
Title:	VP

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MASTER SERVICES AGREEMENT

FEES

EXHIBIT A

Customer agrees to pay for the TRUST 3000 System in accordance with the following schedule. If Customer does not elect to utilize certain applications upon execution of this Agreement, and later elects to utilize such products, SEI will provide the additional applications at SEI’s then-prevailing fees. Customer may elect to utilize the additional applications by executing a written amendment which shall be incorporated into this Agreement.

1. SOFTWARE SERVICES. SEI’s software applications are made available for Customer’s use on SEI’s computer systems for the fee indicated in Section II. The fee entitles Customer the right to use the application as well as associated application support. Charges for computer system usage are identified in the section entitled “Processing Services” below.

Software Application
TRUST 3000 System includes the use of:	Market Link
13-F Securities Services	Portfolio Realignment
ACH Interface	Position Reconciliation
ARP Interface	Proxylink
Asset Source	Scientific Amortization and Accretion
Automated Cash Management	Security Movement and Control
Automated Income Processing	SPECTR Statements
Automated GNMA Processing	Standard Dividends
Automated CPT Processing	Trade 3000
Consolidated Statement	Mutual Fund Clearing Network
Corporate Actions Processing (CAPS)	FastTax Bridge
Deplink Trade
Deplink Income
Disaster Recovery
Employee Benefit Reporting (Current Standard Reports) - Includes Form 5500 Standard EBR Statement Reports
Enhanced Mutual Fund Processing
Generic BCS/Name & Address Custom Extract (TNA999)
IntraDay Sweep
Investor Statement

Items designated with an asterisk (*) are subject to a separate agreement and the terms and conditions of this Agreement (other than this Exhibit A and Exhibit E) shall not apply to such items.

II. PROCESSING SERVICES. SEI agrees to provide the Software Services set forth above and the Processing Services described herein for the fee set forth below. (The Software Services and Processing Services monthly fee is hereby collectively called the “TRUST 3000 CORE Fee”.) Customer agrees to pay SEI a minimum monthly TRUST 3000 CORE fee for the specified level of processing resources described below. If Customer requires processing in excess of the allowances

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specified, SEI shall make reasonable efforts to provide such processing and Customer agrees to pay SEI the incremental processing fee for any activity above the specified allowance.

Minimum Monthly TRUST 3000 Core Fee (Includes 1,262 accounts) $ 7,572/month

ACTIVITY	INCREMENTAL ALLOWANCE	MONTHLY Fee (in excess of Incremental Allowance)
1.      Number of Accounts	over 1,262	$ 6.00/account
2.      Employee Benefit (“EB”) Accounts	0	$5.00/EB account

The number of terminals of Customer that may access TRUST 3000 at any one time shall not exceed the number of employees of Customer that are assigned on a full-time basis to Customer’s trust operation function.

III.    SUBSYSTEMS/OTHER SERVICES MONTHLY SERVICE FEE

Product/Service	Allowance	Additional Fees Over Allowance
Advanced Personal Trust Statement	1,000 statements/month	$2.33/account/month
Advent Axys	1 seat for performance reporting	Prevailing rate
CustodyStation	2 seats for report writing	Prevailing rate
Customer StrataStation	38 seats 1 seat/every 100 accounts over 1,262	Prevailing rate
Pay3000	1058 checks/month	$1.10 /recurring check $2.50 /lump sum check
StrataWeb	1 seat per account	$2/seat/month
TrustQuery	1 seat for report writing	Prevailing rate
Monthly Common & Collective Fund Valuation	N/A	$625/fund/month
Investment Scorecard Interface	Standard Interface	Prevailing rate for any custom modifications
Relias Interface	Standard 401(k) Interface	Prevailing rate for any custom modifications
Trust3000 Anywhere	8 seats	Prevailing rate

FTI: The following SEI generic programs create extract files and/or accept SEI format specific files for uploading into the TRUST 3000 system. SEI agrees to provide Customer access to the programs that generate the extract files and to the program which loads trades into the system at no additional cost. The files created by the program extracts will be read by other programs that reformat the data for other applications, specifically the FTI portfolio management system. In the event Customer requires

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additional data fields to be added to the extract or any programming to reformat the data extracted, then Customer agrees to pay SEI at the then prevailing rate for such services.

The following identifies the generic extracts by program name:

1. Program Name = FRTIPS - The purpose of this program is to extract descriptive account information from the TRUST 3000 Account Master File. This file may be read by other programs that reformat the data for other applications. Specifically, Customer will use the generic extracted fields to populate, calculate fields or reconcile the Account Information File on the FTI Portfolio Management System.

2. Program Name = FRTAST - The purpose of this program is to extract descriptive asset information from the TRUST 3000 Asset Static File. This file may be read by other programs that reformat the data for other applications. Specifically, Customer will use the generic extracted fields to populate, calculate fields or reconcile the Asset Information File on the FTI Portfolio Management System.

3. Program Name = TAXEXT - The purpose of this program is to extract financial and descriptive data, taxlot and position information from the TRUST 3000 Taxlot and the TRUST3000 Position files. This file may be read by other programs that reformat the data for other applications. Specifically, Customer will use the generic extracted fields to populate, calculate fields or reconcile the Account Holding File and the Trade Blotter File on the FTI Portfolio Management System.

4. Program Name = TOEINT - The purpose of this program is to upload trade orders into the TRUST3000 trade order entry system. The program accepts open orders or executed orders for stocks, closed and open end mutual funds, bonds, mortgage backed securities and sweep funds. Open orders which qualify can be automatically routed to SEI’s Marketlink for execution.

IV. TRANSACTION SERVICES. The following products and services are offered through SEI by Third Party Vendors and provide direct communication linkage, accounting updates and/or interface processing.

	TRANSACTION CHARGE
Disaster Recovery	Included in Core Fee
(Subject to the terms and conditions of Exhibit E) Domestic Third Party Access
Local Dial-up Network Access	$0.35/minute
“800” Service	$0.60/minute

V. CUSTODY SERVICES

Non- SEI Mutual Fund Per Account	$1.25 per position per month
Non- SEI Mutual Fund Transaction	$6.00 per transaction
Non-SEI Money Market Sweep Fee	$0.00 per fund per month
Depository/Book Pantry System Transaction Fee	$6.00 per transaction
Physical Transactions	$20.00 per transaction
Physical Transactions Rush	$60.00 per transaction
Per Issue Fee	$1.00 per issue per month

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Trades Fed	$10.00
Trades - PTC	$20.00
PTC Pay Down Transaction Fee	$6.00 per transaction
Physicals	$30.00 per transaction
Euroclear Trades	$30.00 per trade
Euroclear Annual Holding Fee	3 basis points
ADR and Other Issue Fees	$1.25 per issue per month
U.S Wire Fee (for in-going or out-going wires)	$7.00 per wire
Global Wire Fee (for in-going or out-going wires)	$30.00 per wire
Unaffirmed Trades	$10.00 per trade
Trade Corrections	$10.00 per trade
Shipping	Prevailing carrier rates

For purposes of this Section V (Custody Services) above, transactions are defined as: all security purchases, sales, maturities, redemption’s, additions (after initial transfer of account assets on day of system and custody conversion), pay downs, exchanges, conversions, withdrawals (including gifts and distribution of assets at termination of account), and the wire of funds not directly related to an immediate purchase).

VI. THIRD PARTY VENDOR SERVICES¹

1) The following products and services are offered through SEI by Third Party Vendors. SEI provides TRUST 3000 interface processing to and from external third party information sources including but not limited to Interactive Data Services, Inc., Merrill Lynch, Kenny S&P, Muller Data Corp., FT EXTEL, XCITEK, Standard & Poors, DTC, Financial Information, Inc. required by TRUST 3000 customers.

2) SOURCE 3000. SEI reserves the right to modify its menu of SOURCE 3000 product offerings as well as its price list for product offerings upon thirty (30) days notice in writing to Customer. It is understood and agreed that access to any product offering may be withdrawn by SEI upon termination of SEI’s right to redistribute specific product offerings by third party vendors to SEI. Notwithstanding the foregoing, in the event SEI ceases to offer any of the Third Party Services which are included within the Source 3000 product, SEI shall replace such product with a substitute product which offers comparable functionality. Any fee increases are subject to the limitations of Section 3.03 of this Agreement.

SEI warrants that it has obtained the right to redistribute the securities and financial data incorporated in SOURCE 3000 to Customer. SEI MAKES NO OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE DATA UTILITY, ITS MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

IN NO EVENT SHALL SEI BE LIABLE FOR DAMAGES OF ANY KIND, NO MATTER HOWEVER CAUSED, IN CONNECTION WITH CUSTOMER’S USE OF SOURCE 3000 REGARDLESS OF WHETHER SUCH DAMAGES ARE DIRECT, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE. CONSEQUENTIAL OR SIMILAR DAMAGES INCLUDING, WITHOUT

¹ All prices relating to products and services offered through SEI third parties are subject to the limitations, restrictions and pricing terms which may be imposed from time to time by such third party vendors (as referenced in Section 6.03 of the Agreement).

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LIMITATION, LOSS OF PROFITS, LOSS OF BUSINESS OR INTERRUPTION OF BUSINESS, WHETHER SUCH LIABILITY IS PREDICATED ON CONTRACT, STRICT LIABILITY OR ANY OTHER THEORY, EXCEPT FOR DAMAGES CAUSED BY SEI’S GROSS NEGLIGENCE, WILLFUL MISCONDUCT OR FRAUD.

3) Customer may elect to utilize alternative or additional services after the execution of this Agreement by executing a written amendment which shall be governed by the terms and conditions hereof. Any such alternative or additional services will be provided at SEI’s then prevailing rates.

PRICING/DIVIDEND APPLICATIONS:

Core Equity Daily	$0.20 /security priced/week
IBQ	$0.40 /security priced/week
B03 Municipals (monthly)	$0.37 /security priced/month
B04 Options	$0.20 /security priced/week
CMO	$0.30 /security priced/week

VII. OUTPUT SERVICES. SEI provides output processing services to customers who require output handling to be accomplished by SEI in lieu of direct transmission to the customer’s facility. These services are provided at SEI’s prevailing rates.

Advanced Personal Trust Statement Production
Black and white printing	$	0.16 per page
Color printing	$	0.18 per page

VIII. DATA CENTER ACCESS. Telecommunication, Equipment and Equipment Maintenance services will be provided as specified in the attached Exhibit B.

IX. INSTALLATION CHARGES. Installation fees for all products and services which Customer has elected to license as of the date of execution of this Agreement, are included in the “Base Project Fees” for the Conversion which are set forth in Exhibit G.

X. OTHER OPTIONAL PRODUCTS AND SERVICES. Customer has not contracted for any optional services, but may do so in the future.

XI. FEES NOT LISTED. Any fees and services not specifically listed in this Agreement or its schedules, or any products or services Customer may elect to license in the future, will be provided at SEI’s prevailing rate. SEI has disclosed in these Exhibits A, B and G all fees for all current services requested by Customer in conjunction with the TRUST 3000 System and the Licensed Products.

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MASTER SERVICES AGREEMENT

DATA CENTER ACCESS

EXHIBIT B

I. Telecommunication Services. SEI will provide access to SEI’s data center via high-speed telecommunication circuits, modems and/or concentrators. Customer will pay monthly service charges to SEI as shown below, as well as any installation or maintenance expense associated with the required telecommunication services or equipment. The monthly charges for telecommunication services may change as service charges are changed by the companies that supply the telecommunication services to SEI. Customer will pay all such price changes and any other charges relating to provided telecommunication services.

Quantity	Initial Circuit(s) Description	Install Fees		Initial Monthly Fee
1	Dedicated Circuit	$	0.00	$	1875.00
	128Kbps Service - 1544Kbps Access - 32Kbps CIR
1	Dial Backup - 64Kbps	$	0.00	$	150.00
	or
1	Dial Backup - 128Kbps	$	0.00	$	300.00
	(Customer’s Primary Site)
1	ISDN Dial Backup - 128Kbps	$	0.00	$	600.00
	(Customer’s Disaster Recover Site)

(If installation of ISDN Dial Backup is requested after 11/01/04, it will be priced at the prevailing rate.)

Within 30 days after Cutover Date, if it is determined Customer requires a larger dedicated circuit, SEI shall upgrade Customer to a 256Kbps circuit at no additional charge.

In the event Customer elects to modify or cancel a telecommunication service order, and such election may be implemented without additional cost to SEI, Customer must provide SEI with written notice of such election. It is understood and agreed that such election shall be effective no earlier than ninety days from SEI’s receipt of written notice thereof. Customer further agrees that all charges incurred by SEI as the result of Customer’s election shall be paid by Customer.

II. Access Circuits. Customer understands and agrees that SEI will be obtaining circuit facilities necessary to connect Customer’s location(s) to SEI from telecommunication carriers, local exchange carriers, alternate access vendors and/or others (“Circuit Providers”). Customer shall be responsible for all fees payable to such Circuit Providers. SEI shall use reasonable efforts to work with the Circuit Providers to resolve problems with their services, but SEI shall not be responsible for interruptions to SEI services caused by such Circuit Providers or installation delays caused by Circuit Providers or other third parties.

III. Equipment

1. SEI Provided Equipment on Customer’s premises. The following applies to any SEI provided equipment located on Customer’s premises:

a) SEI will deliver and install and maintain the required telecommunication equipment, except as otherwise provided herein.

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b) Customer, at its own expense, will provide (i) an equipment room compliant with all applicable laws and regulations and other environmental conditions as specified by SEI; (ii) reasonable access to the equipment as specified by SEI; and (iii) adequate work space, heat, light, ventilation and electrical outlets.

c) SEI equipment shall not be removed, relocated, modified, or attached to non-SEI equipment by Customer without prior authorization from SEI.

d) Title of the equipment will remain with SEI. Customer will, be liable for maintenance/repair charges or the replacement cost of the equipment if it is damaged or lost due to theft, negligence, intentional acts, unauthorized acts, or other causes within reasonable control of the Customer, its agents, or employees.

e) Upon termination of this Agreement or earlier if equipment is no longer in use, Customer will make the SEI equipment available for removal. Customer will return the equipment in the same condition as originally installed, ordinary wear and tear expected. SEI will not be obligated to restore the premises to its original condition. If Customer does not promptly return the equipment or make it available for removal by SEI, Customer shall pay to SEI an amount equal to the then current market value of such equipment as reasonably determined by SEI.

2. Customer Responsibilities

a) Customer shall ensure that all Customer-provided equipment on its premises that connects to the SEI provided network service equipment will perform according to published technical specifications and will conform to the agreed to interface requirements.

b) Customer will be responsible for providing a dedicated, dial-up telephone line connected to the modem used for providing out-of-band access to the console ports of the SEI provided equipment on the Customer’s premises. The dial telephone line can be a POTS line, a Centrex line or a PBX extension with direct capability, but must be a “dedicated” analog line.

c) Customer will be responsible for extending the Customer’s Local Area Network (LAN) to which the SEI provided equipment is connected. Customer is required to provide the appropriate media adapter/cables for connecting to its LAN.

d) SEI will request that Circuit Providers or other third parties be responsible for all premises circuits required to extend the access circuits from the point where the Circuit Provider links on the Customer’s premises to the location where the SEI provided equipment on the Customer’s premises is deployed. Customer shall cooperate with such Circuit Providers or other third parties. In the event that SEI’s request for assistance from such Circuit Providers or other third parties is denied then, Customer and SEI will mutually agree as to a process regarding how to extend.

e) Customer agrees to assist SEI in performing certain minor maintenance on any SEI provided Equipment located on Customer’s premises as specified by SEI or the manufacturer of such equipment.

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f) Customer will coordinate with SEI while SEI runs connectivity tests to test the service.

3. Equipment Services. Certain limited items of equipment may be acquired from SEI on a purchase basis. Customer acknowledges that SEI is not the manufacturer of the equipment and is providing the equipment as a convenience and accommodation to Customer. Notwithstanding the foregoing, SEI will repair or replace defective equipment supplied by SEI.

SEI MAKES NO WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED, IN FACT OR IN LAW, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL SEI BE LIABLE FOR ANY DAMAGES IN CONNECTION WITH SUCH EQUIPMENT OR THIS AGREEMENT REGARDLESS OF WHETHER SUCH DAMAGES ARE CLAIMED TO BE DIRECT, SPECIAL, INCIDENTAL, INDIRECT, PUNITIVE OR CONSEQUENTIAL DAMAGES OR FOR LOSS OF PROFITS, REVENUES OR DATA, EVEN IF SEI HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

Customer agrees to pay all expenses associated with shipping and insuring of any equipment provided hereunder from SEI’s and manufacturer’s site to Customer’s site. All such equipment shall be shipped F.O.B. manufacturer’s or SEI’s site.

In the event Customer cancels or modifies an order for equipment, Customer understands and agrees that any such cancellation or modification may be subject to a cancellation/modification charge which shall not exceed twenty percent of the purchase price for the applicable equipment. In addition, in the event of any such cancellation or modification, Customer shall reimburse SEI for all of its out-of-pocket expenses incurred in connection with such order for equipment.

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MASTER SERVICES AGREEMENT

DECONVERSION SERVICES

EXHIBIT C

Upon the termination of this Agreement as set forth in Section 2.04, and upon Customer request, SEI will provide Customer with the following services to effect a deconversion from the TRUST 3000 System.

Upon Customer’s written request to SEI for deconversion services to be performed, SEI will provide Customer with the following deliverables:

1) DECONVERSION EXECUTIONS: SEI will provide to Customer: (i) two trial deconversion execution, (ii) one audit package, and (iii) the actual deconversion execution for $7.50 per account per tape.

Any additional trial deconversion executions, additional audit packages, any Custom extracts, or FORCE programs will be provided at the fees specified herein in Sections 2 and 3 of this Exhibit C.

2) MAGNETIC DECONVERSION TAPES & FILES: SEI will provide a computer generated file extract for each trust and custody account then on the TRUST 3000 Service on magnetic tapes, and in electronic file format transmitted to Customer, in a form sequentially accessible in the standard format as determined by SEI. SEI agrees to provide Customer with both keys and file layouts for such sequentially accessible files and tapes. Magnetic tapes and files will be produced for the following files:

Account-Master	Asset-Static
B/C/S	Memos
Unique-Assets	Name and Address
Taxlots	SMAC - Trades
Positions	SMAC - Brokers

Additional extracts over number committed in Section 1 will be available at then prevailing rates.

3) LIVE FORCE PROGRAM. If requested, SEI will provide to Customer one “FORCE” program to facilitate the deconversion of the trust and custody accounts.

The “FORCE” program shall include:

(a) Programmatically “FORCE” all statements type B/C/S records to produce Cash and/or Asset Standard Statements from the beginning of the statement period through the deconversion date.

(b) Programmatically “FORCE” all accounts in order to produce cumulative Tax Worksheet information from the first of the fiscal year through the deconversion date.

FORCE programs are available at $7.50/account.

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4) OPTIONAL SERVICES:

(a) AUDIT PACKAGE. Should Customer require additional audit packages above the audit package described in Section (1) above, Customer agrees to pay SEI for each additional audit package(s) produced at $1,000 per audit package.

(b) CUSTOM DECONVERSION OPTIONS. Customer may elect, upon written request to SEI, to purchase non-standard deconversion options. Customer agrees to pay for any additional Custom File extracts which are not specifically listed in

Section (2) above for a fixed quote rate basis.

(c) ADDITIONAL TRIAL DECONVERSION. Magnetic tapes may be produced for additional Trial Deconversions over the two trial deconversion extracts described in Section 1 above, upon client’s written request (which shall be provided forty-five days prior to any trial deconversion date) and will be billed at then prevailing rates.

(d) TEST DATABASE. A test database may be provided within ninety days of Customer’s written notice at SEI’s prevailing fees for such service.

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MASTER SERVICES AGREEMENT

LICENSED PRODUCTS

EXHIBIT D

Customer agrees to pay for and license only those Licensed Products in accordance with and as reflected on Exhibit A.

I. DESCRIPTION

1. StrataWeb.

Product Description. StrataWeb is designed to provide Customer and Customer’s clients the ability to access Account information via the Internet.

StrataWeb Information. StrataWeb Information shall include the following pages, which are described in more detail in the Documentation for StrataWeb; Account Summary Page; Investment Detail Page; Unrealized Gain/Loss Page; Activity Detail Page; Profile Page; and Account List Page.

Additional pages of information may be made available to Customer as functional releases. The fees associated with each such functional release will be determined at the time such functional release is made available to Customer.

a. SEI grants to Customer a non-exclusive, non-transferable, limited license to: (i) use StrataWeb (including the Documentation therefore) during the term of this Agreement, to access, StrataWeb Information which is resident on StrataWeb; and (ii) print and otherwise make copies of such StrataWeb Information solely for Customer’s use in connection with providing trust processing and reporting services for Customer’s clients, provided that all titles, trademarks, and copyright, proprietary and restricted rights notices shall be reproduced in all such copies of the StrataWeb Information, and that all such copies of the StrataWeb Information shall be subject to the terms of this Agreement.

b. SEI shall customize StrataWeb to include customizations requested by Customer. Such customizations shall be in formats specified by SEI and shall be prepared and provided to SEI as set forth in the Documentation for StrataWeb. SEI owns and shall continue to own all right, title and interest in and to StrataWeb following the incorporation of customizations into such product, including all copyright and other intellectual property rights therein and appurtenant thereto; provided, however, that Customer shall continue to own all right, title and interest in and to the Customer materials supplied by Customer. Customer hereby grants SEI a license to prepare customizations and to incorporate the same into StrataWeb as authorized hereunder.

c. Customer may authorize or permit Customer’s clients to (i) use StrataWeb, during the term of this Agreement, to access their StrataWeb Information resident on StrataWeb; and (ii) print and otherwise make copies of such StrataWeb Information solely for their own use, provided that each such client of Customer shall first have assented, through use of StrataWeb or in some other reasonable and verifiable manner, to the Terms and Conditions of Use applicable to StrataWeb, as such Terms and Conditions of Use appear on the StrataWeb access site and are amended by SEI from time to time. Customer agrees not to take any action that would mask, delete or otherwise alter the Terms and Conditions of Use, any other disclaimers and/or any copyright, trademark, service mark or other

27

proprietary notifications that SEI may place on StrataWeb from time to time, and/or any links from StrataWeb to the Terms and Conditions of Use and/or such other disclaimers and notifications. Customer shall be and remain primarily liable for compliance by its End Customers with the Terms and Conditions of Use.

d. Notwithstanding anything in this Agreement to the contrary, StrataWeb is designed for use by Customer and Customer’s clients to facilitate their own direct access to information regarding their Accounts and is not intended for use by and may not be used by Internet Information Consolidators. StrataWeb shall be used solely by individual natural persons manually and directly accessing the applicable Website and the StrataWeb Information. Access to the StrataWeb Information may not be made by any automated program that does not require direct and individual human intervention unless otherwise agreed in writing by SEI. For purposes of this paragraph, “Internet Information Consolidator” means any person engaged in the business of providing information aggregation services, screen-scraping services, information consolidation services or information re-distribution services by means of the Internet for the purpose of aggregating or consolidating information from more than one website. Customer agrees to notify SEI in the event it becomes aware that any of its clients has granted Account access to an Internet Information Consolidator, as well as, to reasonably cooperate with SEI in SEI’s pursuit of a cessation of such access.

e. Except as expressly provided herein, all right, title and interest in and to StrataWeb, including all patent rights, copyrights, trademarks and all other intellectual property rights inherent therein or appurtenant thereto, is and shall remain in SEI.

2. CSS Browser. CSS Browser is SEI’s “Customer StrataStation^™ Browser” product, a software application product that is used to access and manipulate data housed on the System, and all Documentation for such product.

3. ODT. ODT is SEI’s “Open Data Transactions,” an applications programming interface which allows the execution and updating of the System transactions. ODT provides an application programming interface for executing System business functions from an application running at the Customer’s site. ODT supports both update and limited real-time inquiry functions. Before placing any of the application software developed by or for Customer through the exercise of the license rights for ODT into commercial use, Customer shall, with the participation and assistance of SEI, at SEI’s then current time and materials rates, perform appropriate quality assurance testing on such application software.

4. ODR. ODR is SEI’s “Open Data Replication” platform interface, an Information Movement and Management Facility which allows data housed on the Account Processing System to be retrieved, transformed into relational information, integrated with other sources, processed and analyzed.

5. CustodyStation. CustodyStation is a Windows-based reporting workstation which enables Customer to view standard reports or design custom reports based on extracted Account data housed on the Account Processing System. CustodyStation is comprised of the following components: SEI’s ODT client software, SEI’s extract software and software owned by Open Information System’s, all of which operate in connection with software owned by Sybase.

SEI hereby grants to Customer a non-exclusive, non-transferable, limited sublicense, which shall be limited to the United States, to: (i) use the OIS Software component of CustodyStation during the term of this Agreement, only in object code form, solely in connection with Customer’s use of CustodyStation pursuant to the license granted under this Agreement, and for no other purpose; (ii) use the Sybase Software, only in unmodified object code versions, solely in connection with Customer’s use of CustodyStation and subject to the designation of Customer’s license as described in this Agreement; and

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(iii) copy the OIS Software and the Sybase Software only to the extent necessary in connection with the uses permitted under this Agreement and for archival or backup purposes, provided that all titles, trademarks, and copyright, proprietary and restricted rights notices shall be reproduced in all such copies, and that all such copies shall be subject to the terms of this Agreement.

Subject to the license rights granted by SEI to Customer in this Agreement, all right, title and interest in and to CustodyStation, including all patent rights, copyrights, trademarks and all other intellectual property rights inherent in any of the foregoing or appurtenant thereto, is and shall remain in SEI, or with respect to the OIS Software, in Open Information Systems, LLC, or with respect to the Sybase Product, in Sybase, Inc.

6. PerformanceStation. PerformanceStation is a performance measurement and reporting application. Performance-Station consists of four components: the performance calculation engine; Back Office functionality; Front Office functionality, and the performance reporting page of StrataWeb (if Customer has purchased the StrataWeb application). Back Office functionality provides data audit and verification tools and system edit capabilities. Front Office functionality provides access to investment returns in a variety of tabular and graphical report forms.

7. Advent Products. The Advent Products are portfolio management and order management applications that are integrated with the System. The Advent Products are comprised of the following:

Axys^® is a portfolio accounting and reporting system. Features of Axys include: portfolio accounting, performance measurement, fixed income, electronic interfaces and reporting.

Moxy^® is an application which automates manual trading and processes. Features of Moxy include: trading, integration, order preparation and reporting.

BREU is a web-based reporting solution that includes packaged reports and open toolkits to develop reports.

Customer understands that the use of the Advent Products includes the submission of data regarding its clients to the Advent network. Customer warrants to SEI that Customer has obtained all appropriate written consent to the transmission of Customer’s client’s data to third party databases. Customer shall defend, indemnify and hold harmless Advent Software Inc. (“Advent”) from and against any claims, demands, damages, costs, expenses, liabilities, actions, suits or proceedings made or brought against, or collected from, Advent by a third party (meaning a third party as to the Customer or any of its Affiliates) to the extent arising from the following (each, a “Covered Claim”): (i) any allegation that the Customer did not have the requisite authority to instruct or cause SEI to send data to Advent for inclusion in the Advent network (“Network Data”); (ii) any allegation that Advent did not have the requisite authority to provide SEI with access to the Network Data through the network on Customer’s behalf; and (iii) Customer or any other person’s usage of or reliance on the Network Data.

II. APPROVED HARDWARE AND SOFTWARE CONFIGURATION; DATA UPDATES. The use of each Licensed Product may require a minimum hardware and/or software configuration to be specified by SEI from time to time. The Licensed Products will not be available for use during maintenance or data update periods.

III. ADDITIONAL DISCLAIMER. Customer acknowledges that the Internet is an unsecure, unstable, unregulated, unorganized and unreliable environment, and that the ability of SEI to deliver information using services using the internet is dependent on the internet and equipment, software, systems, data and

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services provided by various telecommunications carriers, equipment manufacturers, firewall providers, encryption system developers and other vendors and third parties. SEI does not warrant that the Licensed Products delivered over the Internet will operate without interruption or delay and/or be error free, or that all failures of the licensed products delivered over the internet to conform to the specifications therefore can or will be corrected.

In no event shall SEI be liable for lost profits or business, loss of goodwill, loss of data, interruption of business, or for any exemplary, punitive, special, indirect, incidental, consequential, special or punitive damages, regardless of whether such claim arises under any theory of tort, contract, strict liability or otherwise in connection with any Licensed Product and regardless of whether SEI is advised of the possibility of any such damages; provided, however, Customer understands and agrees that SEI does not commit that the Licensed Products will achieve any specific results, operate without interruption or be error free. SEI’s sole obligation and liability with respect to any nonconformity of any Licensed Product shall be to use commercially reasonable efforts to remedy the nonconformity as soon as practicable. SEI’s sole obligation and liability with respect to any transmission of incorrect information or data shall be to retransmit the correct information or data to customer or the appropriate end customer. Excepting SEI’s responsibility with respect to infringing claims, the aggregate liability of SEI for any and all claims arising under or in connection with this agreement or the subject matter hereof shall not exceed six months of licensing fees for the applicable licensed product paid by Customer under this agreement. In addition, SEI is not responsible for any failure of any Licensed Product or the System due to the availability, reliability, security or operation of the Internet.

IV. DEFINITIONS. For purposes of this Agreement the term “Seat” shall mean an individual user identification. Each user must have a separate and distinct user identification and users may not share user identifications.

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MASTER SERVICES AGREEMENT

RECORD RETENTION

EXHIBIT E

I. OVERVIEW. This Exhibit E sets forth the standard record retention protocol that SEI will follow in the performance of services hereunder.

II. DESCRIPTION. SEI will back-up system software, custom software and Customer’s client data and will abide by the following record retention procedures:

End of Year Saves:	Final 12/31/xx database (including transaction information) saves	= 7 years
End of Month Saves:	Final EOM saves, taken on last business day of calendar month	= 18 months
Daily Saves:	Nightly pre-nightwork full save of databases	= 15 business days

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MASTER SERVICES AGREEMENT

DISASTER RECOVERY

EXHIBIT F

I. OVERVIEW

This Exhibit describes the disaster recovery services that SEI will provide to the Customer in order to facilitate business continuity. Specifics are presented regarding disaster recovery resources at the recovery location, system accessibility, and TRUST, OPEN ARCHITECTURE and STRATA Products functionality that will be supported through the recovery site.

II. DESCRIPTION

SEI hereby agrees to provide to Customer a disaster recovery product (“Disaster Recovery Product”) that would enable Customer to continue processing through SEI’s off-site disaster recovery center (“Disaster Recovery System”) in the event of a disaster at SEI’s Information Technology Center (“ITC”). The Disaster Recovery Product supports essential functions of SEI’s TRUST, OPEN ARCHITECTURE and STRATA Products. Supported functions are specified and published in the SEI Disaster Recovery Service Guide, as modified periodically, which is incorporated by reference herein. SEI shall give written notice of any major modifications.

A. Defining A Disaster

A disaster is any event that renders the SEI Data Center incapable of providing TRUST, OPEN ARCHITECTURE and STRATA Products Services to its client base for more than 12 hours, and which cannot be resolved by means available on-site. The Disaster Declaration is the result of the evaluation of the incident and the damage assessment process, which determines the severity of the incident to facilitate the disaster declaration decision.

B. Recovery Timeline:

The Disaster Recovery Service is designed to restore the critical processing features of each Product within the stated time frames from a disaster declaration as outlined below:

• TRUST and OPEN ARCHITECTURE Products processing within 40 hours

• STRATA Products processing within 48 hours

SEI will promptly notify Customer of a potential disaster the incident management process and escalation procedures. Periodic updates will follow. The Disaster Declaration is the result of the evaluation of the incident and the damage assessment process, which determines the severity of the event to facilitate the disaster declaration decision.

• The Recovery Timeline following disaster declaration is:

• HOUR 0-8 Declaration and Recovery Execution

Initiation of the DR Plan execution, client notification, mobilization, the establishment of recovery command center, and data recovery.

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• HOUR 8-28 Recovery of Infrastructure and Systems

Data restoration, systems environment recovery, restoration of network Connectivity, and server environment.

• HOUR 28-40 Production Restoration

Restoration of application and production processing environment.

• HOUR 40-48 Client Access

Client access, verification and resume production processing.

• Timeline To Current:

SEI’s production processing and Customer’s interfaces with third party service providers will be current within 3 business days following recovery.

C. Continuation of Processing

The Disaster Recovery Product enables the Customer to continue processing through use of the Disaster Recovery System at the alternate recovery site in the event of a disaster at SEI’s Wayne, Pennsylvania facility, and the availability of a Disaster Recovery Service coordinator at SEI. Customer shall be entitled to resume processing through the Disaster Recovery System (i) at two-thirds (2/3) of MIPS as required by Customer prior to the Disaster Declaration, (ii) at two-thirds (2/3) of number of users as required by Customer prior to the Disaster Declaration, and (iii) and SEI shall provide System Service Levels in accordance with the production Performance Standards within 6 business days of Disaster Declaration.

D. Test Participation

Customer is entitled to participate in any, and as often as Customer chooses to participate, of the regularly scheduled tests of the Disaster Recovery Service, which SEI conducts two times a year, without any additional fees. Customer will be contacted regularly in advance of each test by the Disaster Recovery Service coordinator for participation. SEI will provide Customer with a copy of the formal report following the test as soon as the report is available.

SEI’s provision of the Disaster Recovery Product to Customer shall be coterminous with the basic term and any renewal terms of the Agreement and shall be governed by the terms and conditions of the Agreement.

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MASTER SERVICES AGREEMENT

EXHIBIT G

IMPLEMENTATION SERVICES

Customer and SEI agree the Conversion of Customer’s Trust Accounts onto the TRUST 3000 System in accordance with the protocol set forth below.

SECTION 1 - DEFINITIONS. As used herein, the following words shall have the respective meanings assigned to them below:

1.01 “Acceptance Criteria” means those criteria for acceptance by Customer of services to be performed hereunder described in Section 4.07 below.

1.02 “Business Model” means Customer’s processing parameters including coding structure, processing characteristics, Trust 3000 subsystems, Customer interfaced subsystems, statements, reviews, Custom Work, batch processing, work flows and procedures existing as of the date of this Agreement.

1.03 “Critical Milestones” means those tasks and dates related thereto, which are identified in the Project Plan as “Critical Milestones”.

1.04 “Conversion” means the tasks which the parties must perform under the Project Plan, this Agreement, and any Custom Agreement, to achieve the completion of the conversion of Customer’s Existing Trust Accounts onto the TRUST 3000 System.

1.05 “Custom Agreement” means those agreements between SEI and Customer which relate to Custom Work which SEI either will perform during the Project or after completion of the Project, to achieve those tasks to which the parties agree in writing are specific to Customer.

1.06 “Customer Account information” means all data necessary to populate and process the Existing Trust Accounts on the TRUST 3000 System.

1.07 “Custom Database” means the database used for all Custom Work testing prior to the Live Date.

1.08 “Custom Work” means all programming, coding, or software which Customer requires SEI to develop, create, or modify, due to the unique processing and reporting requirements of Customer.

1.09 “Custom Work Project List” means the list of Custom Work Customer desires SEI to perform in connection with the Conversion.

1.10 “Dress Rehearsal” means a simulation of Customer’s processing day, including a limited batch processing execution and on-line execution of realistic test scripts with participation of both Customer and SEI staffs.

1.11 “Final Trial” means the last Trial prior to the Live Conversion.

1.12 “Freeze Date” is the date upon which the parties agree no further changes may be made to the Business Model, and it shall be the date of the Final Trial.

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1.13 “Live Conversion” means the execution of all tasks within the Project Plan which shall culminate in SEI’s conversion of Customer’s Existing Trust Accounts onto the Trust 3000 System.

1.14 “Live Date” means the date identified in the Project Plan as the date upon which Customer shall process its Existing Trust Accounts on the TRUST 3000 System in an actual live, production environment; being the date upon which the Live Conversion occurs.

1.15 “Live Environment” means processing conditions for on-line and batch which shall exist as of and after all loading of financial data which will allow Customer to process each day’s work.

1.16 “Management Executive” means the senior management executive appointed by a party to this Agreement, who is responsible for the Project and whose role is to participate in executive status meetings and resolve any issues which are escalated to him/her by the Project Manager.

1.17 “Man-Day” means the equivalent of one person working a full business day.

1.18 “Milestones” means critical dates upon which designated tasks must be performed by a party or by the parties as the case may be.

1.19 “Pre-Live Date Custom Work” means Custom Work that the parties agree in writing must be completed prior to the Live Date.

1.20 “Post-Live Date Custom Work” means Custom Work other than Pre-Live Date Custom Work.

1.21 “Project” means the performance of all tasks described on the Project Plan.

1.22 “Project Manager” means the individual appointed by each party to supervise such party’s performance under this Agreement. The expression: “Project Managers” will mean the SEI Project Manager and the Customer Project Manager. In the event that a Project Manager is replaced, the party replacing its director shall send written notice of the replacement to the other party.

1.23 “Project Plan” means the detailed written plan to which the parties have agreed, which itemizes all tasks that must be performed including the timing of such tasks, to achieve the Project and which is incorporated by reference herein.

1.24 “Project Team” means the persons who are assigned by each party as the resource group to work on the Project.

1.25 “Third Party Services” means services which will be provided to Customer from third party sources such as, but not limited to, telecommunication providers, data and pricing service providers (e.g., Merrill Lynch), and other third party service providers.

1.26 “Timeline” means the successive performance dates and the tasks which are to be performed on those dates, which are described in the Project Plan.

1.27 “Training Database” means the TRUST 3000 System database environment which houses the required Customer Account Information, in which Customer and SEI shall test the Business Model, test workflows and procedures, and train Customer personnel prior to the Live Date.

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1.28 “Trial” means the execution of mutually agreeable data capture process and verification used to test the movement of required Customer Account Information onto the TRUST 3000 System.

1.29 “Trial Database” means the Trust 3000 environment used to test the execution of the Trials.

SECTION 2 - PROJECT SCOPE AND PERFORMANCE

2.01 Project Plan. Each party to this Agreement shall use commercially reasonable efforts to perform all tasks assigned to it in this Agreement and the Project Plan, in accordance with the Timeline. SEI and Customer agree to mutually draft and execute the Project Plan (including all Milestones and Critical Milestones) within thirty (30) days after the date first written above in this Agreement. The Project shall be performed in accordance with the Project Plan.

2.02 Changes To This Agreement and/or Changes to the Project Plan. Any changes to the Project Plan which affect any Critical Milestones or the costs to SEI of performing its obligations under this Implementation Exhibit or the Project Plan, must be implemented pursuant to a written amendment to this Exhibit or the Project Plan, as the case may be, signed by SEI and Customer. In the event either party shall desire such changes to the Project Plan or this Exhibit such party shall notify the other in writing. Upon delivery of such notice to Customer or upon receipt of such notification by SEI (as applicable), SEI will: (a) prepare a written estimate of the cost of such changes and (b) set forth in writing the effect of such changes upon the Timeline. Each Project Manager shall notify his/her Management Executive of the proposed changes. If Customer shall elect to make such changes in accordance with SEI’s cost estimate and changes to the Timeline, the parties shall implement such changes pursuant to a written amendment to this Agreement, or the Project Plan as the case may be Changes to the Project Plan which do not affect Critical Milestones, or the costs to SEI of performing its obligations under this Agreement and the Project Plan, may be made orally upon the agreement of each Project Manager.

2.03 Project Management. SEI and Customer agree to each appoint a Management Executive. In addition, each party shall appoint a Project Manager. Each Project Manager shall be responsible for reporting to his/her Management Executive any issue which risks causing delay to the Timeline.

2.04 Commitment of Resources. SEI and Customer agree to provide the following resources and hereby acknowledge the following:

(a) Resources. Each party shall provide a sufficient number of adequately trained, qualified resources to perform each party’s obligations under the Project Plan. In addition, Customer shall make any reasonable changes necessary to its internal structure, or method of doing business, to accommodate the performance of the Project Plan. The Project Plan shall include the names of persons who shall constitute each party’s Project Team.

(b) Project Team Authority. To accommodate the time sensitive nature of the performance of tasks on the Project Plan, each party agrees its respective Project Team will have authority to make and approve Project decisions. Subject to Section 2.02. such decisions, when evidenced in writing signed by a Project Team member, shall be binding upon such party. Notwithstanding the foregoing, a Project Team member will not have authority to: (1) alter the scope of the Project, either by deleting tasks to be performed, or by requesting additional tasks to be performed, or (2) amend the fees payable under this Agreement, or (3) make decisions which affect Critical Milestones.

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(c) Additional Effort When Necessary. Meeting the Project Plan’s Timeline may require weekend work and long hours for SEI’s and Customer’s Project Teams. Each party agrees to brief its respective staff of the necessity of such off- hour work performances and each party agrees to use reasonable methods to compel its respective staff to work during such off-hour work hours, when reasonable.

2.05 Custom Work Project List. Customer shall draft and deliver to SEI the Custom Work Project List no later than the delivery date set forth in the Project Plan. Such list shall contain all Custom Work which Customer requires in conjunction with the Conversion. To the extent Customer shall deliver a Custom Project List which may not be reasonably completed prior to the desired Live Date, as determined by SEI in its reasonable business discretion, Customer shall delineate which of the Custom Work is Pre-Live Date Custom Work and which is Post- Live Date Custom Work. Such delineation shall be subject to the approval of SEI.

2.06 Custom Work. All charges for Custom Work and changes to Custom Work are not included in the fees quoted herein. Upon receipt of the Custom Work Project List and its applicable specifications, and under a proposal separate from this Agreement, SEI will provide a fixed price quote (“Custom Fixed Price”) and a custom project plan (“Custom Project Plan”). SEI shall own all right, title and interest in any Custom Work created by it under this Agreement, the Custom Agreement, any work authorization or any other agreement between SEI and Customer including, without limitation, all intellectual property rights inherent in any such Custom Work and any portion thereof and appurtenant thereto including, without limitation, all patent rights, copyrights, trademarks, know-how and trade secrets.

SECTION 3 - DETAIL OF WORK

3.01 Included Services. SEI will provide Customer with the following services:

(a) Overall project management including, but not limited to:

(i) An SEI Project Manager;

(ii) Project consulting consisting of analysis, explanations, workflows and processes, and recommendations on system concepts or specific topics;

(iii) Development of Project Plan with the Customer Project Team (Customer shall maintain the actual Project Plan);

(iv) Development of a status reporting protocol with the Customer Project Team;

(v) Coordination of specification development, testing and installation of Custom Work;

(vi) Coordination of data capture programming resources;

(vii) Management of SEI technical resources to implement production changes needed to accommodate Customer’s trust account base;

(viii) TRUST 3000 expertise for analysis of Customer’s product requirements;

(ix) Formulation of Trial and Live Date game-plans with the Customer Project Team;

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(x) Coordination of SEI resources for Conversion activities; and

(xi) Liaison to other SEI departments.

(b) The following services to confirm service bureau system requirements to accommodate the Customer trust account volume:

(i) CPU/DASD to process in SEI service bureau environment;

(ii) Trial Database;

(iii) Custom Database;

(iv) Training Database;

(v) Network Connectivity to Customer and TSO access; and

(vi) Control and Run Parameters.

(c) Production requirements to accommodate:

(i) Test and document changes to existing batch processing, where necessary;

(ii) Efficiency planning and Implementation;

(iii) Periodic reporting/distribution;

(iv) System configuration; and

(v) Establishment of TRUST 3000 processing environment for Customer.

(d) Programming of the file conversions according to mapping specifications. File conversions include:

• Accounts

• Assets

• Tax Lots

• Ticklers

• Cash Balances

• Names and Addresses

• Memo Files

(e) Coordination of activities for two (2) Trials;

(i) Development of detailed game- plan for Trials with Customer Project Team;

(ii) Execution of two (2) Trials of Customer Account Information. During each Trial, TRUST 3000 database files will be populated with Customer’s Account

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information. SEI will work with Customer to reconcile previous financial balances from Metavante system, to the TRUST 3000 System financial balances;

(iii) Development with Customer of Trial verification procedures, including a full audit package;

(iv) Additional Trials other than those listed in (ii) above, may be scheduled for $10,000.00 each, plus travel and living expenses of the SEI Project Team, upon written approval of the Customer Project Manager; and

(f) SEI agrees to provide up to 20 Man-Days of Training activities for those employees designated by Customer for those services listed in Section I of Exhibit A of this Agreement. To the extent Customer shall require additional support and training, SEI shall provide such additional support and training for $1,000 per Man-Day plus travel and living expenses upon the written approval of the Customer Project Manager.

SEI believes, based on its understanding of Customer’s operations and workforce, that 120 Man-Days of Conversion activities, 33 Man-Days of Post-Conversion activities and 20 Man-Days of Training activities should be reasonably sufficient for Customer, provided Customer’s workforce attends, participates and follow-ups on the support activities and training sessions, as and when scheduled.

(g) Performance of One (1) Dress Rehearsal:

(i) Creation, scheduling and monitoring of batch processing and reporting required to simulate batch processing after Dress Rehearsals using a limited subset of production;

(ii) Coordination of SEI’s Project Team and Data Center personnel for on-site and phone support of Dress Rehearsals;

(iii) Allocation of appropriate CPU prioritization for Dress Rehearsals on-line activity;

(iv) Coordination of event post-mortem and issue resolution;

(v) In the event additional Dress Rehearsals are required, the fee for same will be $15,000.00 plus travel, living expenses of the SEI Project Team, and

(vi) Consultation with Customer Project Team on the creation of scripts for Customer participant; the scripts shall be prepared by Customer, but SEI will provide sample scripts for Customer’s use.

(h) Performance of Live Conversion:

(i) Coordination of SEI resources;

(ii) Provision of mutually agreeable detailed game-plan that will include appropriate SEI support staff at live conversion;

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(iii) Execution of Static Load approximately three weeks prior to the Live Conversion (account, name/address, tickler);

(iv) Customer will add all required central asset records to the existing live database environment;

(v) Execution of Financial Load;

(vi) Provision of verification reports including full audit package; and

(vii) Performance of balancing procedures jointly with Customer.

(i) Post Conversion Support services:

(i) Confirmation of correct system access;

(ii) Assistance in setting up problem control coordination point; and

(iii) Confirmation of accurate batch posting and reporting (night stream).

SECTION 4 - TESTING AND ACCEPTANCE

4.01 Databases, Testing.

(a) Included Databases. SEI shall provide Customer with the following three databases:

(i) Trial Database;

(ii) Custom Database. The parties shall create the Custom Database upon the completion of Trial 1. Customer shall update the Custom Database in test conditions which are required for unit and regression testing of Custom Work; and

(iii) Training Database.

(b) Additional Databases. If Customer desires to purchase additional databases, beyond the usual scope of Trial and Custom Work testing, SEI will, based upon mutually agreeable written specification, provide a written cost estimate and a statement of the affect such additional services will have upon the timeline.

(c) Full Production Batch Processing. The full production batch processing shall exist in the current Live Environment only. If Customer requires additional regioned TSO databases for testing beyond the usual scope of Trial and Custom Work testing, SEI will, based upon mutually agreeable written specifications, provide a written cost estimate and a statement of the affect such additional services will have upon the Timeline.

(i) Batch processing will be included to the fullest extent possible;

(ii) Integration of Custom Work, as available; and

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4.02 Project Testing. All testing to be performed in the course of the Project will be detailed in the Project Plan. Notwithstanding the foregoing, during such testing the data to be examined will include, but is not limited to, merged static data (e.g., account information, names and addresses, tickler records) and financial data (e.g., asset and cash balances, taxlots). Customer shall approve in writing the validity and accuracy of such data following each Critical Milestone Date defined in the Project Plan, specifically including Trials, Dress Rehearsals and Live Date.

4.03 Custom Work Testing.

(a) Test Plans For Custom Work. Customer shall test all Custom Work with SEI’s assistance. SEI shall execute Custom Work on the Custom Test Database as it becomes available. In accordance with the Project Plan Customer shall develop and execute test plans with SEI’s assistance, to test Custom Work as it becomes available. Such test plans shall be based upon written specifications submitted to and approved in writing by SEI.

(b) Installation of Custom Work Under Custom Agreement. At a date to be determined by the parties pursuant to the Custom Agreement, Customer’s Project Manager shall review all installation steps to be performed by SEI to ensure that all Pre-Live Date Custom Work is installed in the Business Model. Customer shall acknowledge and approve in writing the completion of all Custom Work in accordance with the Custom Agreement. Customer shall not unreasonably withhold or delay such written acknowledgment and approval.

4.04 Communications Testing.

(a) System Configuration. SEI and Customer shall conduct, in the months prior to Live Date, test(s) to identify whether the system is configured correctly and that all communication devices and parameters are correctly defined

(b) Responsibility To Pay Cost For Telecommunication Use, Upgrades. Customer and SEI shall conduct tests to determine whether their respective telecommunication systems will support the TRUST 3000 System. Any costs to be incurred in connection with the installation and maintenance of the telecommunication system required for Customer’s use of the Trust 3000 System and other products shall be Customer’s sole responsibility and expense, and in addition to the fees set forth in this Agreement.

4.05 Data Verification.

(a) Validation. Customer shall be responsible for reviewing and validating the migrated data in the Trial Database. Customer alone shall verify the accuracy of file translations during the Trials. The Trials will be Customer’s opportunity to validate its mapping specifications, as well as SEI’s conversion programming. SEI shall provide the reports included in a standard audit package and on-line access as is necessary to perform this validation. Customer shall verify the data during each Trial and the Dress Rehearsals.

(b) Data To Be Reviewed. The data to be examined during the Trials will include static data (e.g., account information, names and addresses, tickler and memo records) and financial data (e.g., asset and cash balances, taxlots). Customer shall verify in writing its approval of the validity and accuracy of this data after each Trial within the Project Timeline.

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4.06 Functional Testing. Customer and SEI shall develop an acceptance test plan which will include on-line entry of data, on-line inquiry and reporting, execution of batch posting and reporting processes, and interface testing. The acceptance testing will commence after Customer provides certification of the Trial Database.

4.07 Acceptance. Customer’s acceptance of the services to be performed under this Agreement shall mean the following Acceptance Criteria have occurred:

(a) Customer’s and SEI’s Project Managers have reviewed and accepted the completion of each Milestone and Critical Milestone in the Project Plans. Customer shall not unreasonably withhold or delay its written approval of any Milestone or Critical Milestone to be achieved.

(b) The Project Live Date balances have been verified and validated and Customer has approved in writing such balances. Customer shall not unreasonably withhold or delay such approval.

SECTION 5 - PROJECT RESOLUTION AND ESCALATION

5.01 Reevaluation Checkpoints. Customer and SEI acknowledge that issues or problems may arise which would cause the Project Live Date to change. In recognition of this, the parties shall build reevaluation checkpoints into the Timeline on a monthly basis.

5.02 Weekly Joint Reviews. The Customer Project Team and the SEI Project Team will, on a weekly basis, jointly review each task, its completion, any upcoming Milestone, and any issues which may arise. Any changes in the Timeline or in the services to be provided under this Agreement will be based upon the mutual decision of both Project Managers, and shall be evidenced in writing and signed by each Project Manager. If such changes affect the Critical Milestones or the cost of the Project, such changes must be approved by Customer as set out in Section 2.02, prior to any such change being implemented.

5.03 Status Presentations. The Customer Project Team and the SEI Project Team will provide Project status presentations at critical points during the Project to each party’s respective Management Executive. Notwithstanding the foregoing, Customer’s Project Manager and SEI’s Project Manager shall notify a non-performing party when he/she has reason to believe that such non-performance will cause Project risks or delays.

SECTION 6 - FEES AND PAYMENT

6.01 Base Project Fees. Customer shall be obligated to pay all fees to SEI described in this Agreement, in the manner and times set forth in this Section 6, and in any Custom Agreement or work authorization executed by Customer. The Base Project Fee is waived.

6.02 Additional Fees and Expenses. The fees set forth in Section 6.01 do not include:

(a) Travel and living expenses of the SEI Project Team;

(b) Consulting beyond the scope of the Project; or

(c) Custom Work

Customer shall reimburse SEI for all of its reasonable travel and living expenses incurred in the course of SEI’s performance of services under this Agreement, the Custom Agreement, or any work authorization, and for all fees for Third Party Services arising under this Agreement, the Custom Agreement or any work authorization Customer may execute. The fees payable by Customer for Custom Work will be

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determined and provided under the Custom Agreement or work authorization. SEI shall provide additional training, on-site support and consulting to Customer at its standard rates in effect from time to time for such services.

6.03 Payment Schedule.

(a) The Base Project Fee is waived.

(b) Fees for products not included in the Project shall be paid by Customer to SEI upon completion of each product installation.

(c) Fees for Custom Work shall be paid by Customer to SEI as provided in the Custom Agreement or work authorization.

(d) Customer shall reimburse SEI for travel and other expenses upon receipt of each invoice therefor; such expenses shall comply with the parameters provided in Exhibit A.

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MASTER SERVICES AGREEMENT

TRUST 3000 PERFORMANCE STANDARDS

EXHIBIT H

1.1 On-Line Processing Availability.

(a) Normal Working Days. SEI will make the processing environment available for Trust 3000 Service on-line processing by Customer and its affiliates between 7:00 am and 7:00 pm Eastern Time, Monday through Friday, excluding holidays for Customer (“Scheduled Hours of Availability”). SEI further agrees to provide access to the Trust 3000 Service on a ‘best-efforts’ basis, past 7:00 pm Eastern Time, provided Customer has notified SEI of its required use by 12:00 noon of that day (“Extended Hours”). Customer acknowledges and agrees that any use of the system after 7:00 pm Eastern Time may delay batch transmission deadlines and the time of system availability the following day. Such delays shall not he deemed a breach by SEI of the service standards set forth in this Agreement. The processing environment shall not be deemed to be available unless Customer’s Pre-Avail Work ( defined below) is completed by 7:00 a.m. Post-Avail Work will be available at such times as are mutually determined by the parties.

(b) Availability Standard. SEI will assure that the Trust 3000 Service is current and available for on-line processing by Customer during Scheduled Hours of Availability at least ninety-five percent (95%) of the time in any given month.

(c) Weekend Availability and Customer’s Holidays. SEI will use its best efforts to make the online processing environment available on Saturdays and holidays at no additional cost. The processing environment will also be made available on a best efforts basis on Sundays between the hours of 1:00 pm and 5:00 pm Eastern Time; provided that, SEI is notified by Customer no later than 5:00 pm on the preceding Wednesday. Customer will notify SEI of Customer’s scheduled holidays on an annual basis for a calendar year no later than November 1 of the preceding year.

2.1 Response Time.

Monthly Average Host Response Time. The average host response time for the Trust 3000 online transactions and inquiry process will be measured by the BMC’s measurement facility. SEI will provide measurement reports at no cost to Customer for the purpose of verifying compliance with the monthly average host response standards, which will be computed monthly during the hours that the on-line processing environment is available during “Scheduled Hours of Availability” as described in Section 1(a) above. The monthly average host response time is not applicable if Customer controlled Batch Processing jobs cause scheduled jobs to extend into the “Scheduled Hours of Availability”. SEI will not exceed three (3) second average host response time.

3.1 Batch Processing Report Availability Commencing 90 days following the Live Date, SEI agrees the services to be provided hereunder shall meet the following service standards. During such 90-day period, SEI will use its commercially reasonable best efforts to meet such standards.

Daily Batch Processing Report Availability. SEI will complete all of the required batch updates (the pre-online nightwork processing and the night stream qualifier reports; cumulatively the “Pre-avail Work”) ready for transmission to Customer in accordance with the following schedule: 7:00 am Eastern Time; or Customer acknowledges and agrees that any use of the

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system after 7:00 pm Eastern Time may delay batch transmission deadlines and the time of system availability the following day. Such delays shall not be deemed a breach by SEI of the service standards set forth in this Agreement.

The Pre-avail Work (which include all posting and pricing jobs) will be jointly defined by Customer and SEI during the Trust 3000 Conversion.

If SEI believes that any Pre-avail Work or other daily work will not be available to Customer on time, SEI will (a) give Customer a prompt notice describing the reason(s) for the delay and the anticipated duration of the delay; (b) work diligently to complete the delayed work as soon as reasonably practicable; and (c) provide to Customer regular updates on SEI’s progress in completing such work until the work is complete.

4.1 Statement/Review Production. Commencing 90 days following the Live Date, SEI agrees the services to be provided hereunder shall meet the following service standards. During such 90-day period, SEI will use its commercially reasonable best efforts to meet such standards.

(a) Trust 3000 SPECTR Statement Availability. SEI and Customer will work jointly together to define Priority One, Priority Two and Normal statement/review jobs.

SEI will generate cash statements, asset statements/reviews and have them ready for transmission within:

72 hours following release for production by Customer or at EOM database creation for statement/review jobs designated.

SEI will use best efforts to exceed these standards.

5.1 Priority Reporting Jobs. Customer may elect to prioritize some periodic work with the statement production or prior to statement production. These priority jobs shall be defined by Customer and agreed to by SEI. Customer understands that delivery of these jobs may impact the Trust 3000 Statement Availability goals described above.

6. Reports to Customer. Upon request, SEI will provide Customer with monthly reports of its performance under this Exhibit H. Such report also shall include, where applicable, SEI’s plans for corrective actions.

7. Client Service Team Staffing. If Customer calls SEI between 8:00 am and 6:00 pm Eastern Time, SEI will provide Client Service Team staffing to assure that when Customer gets a voicemail or VRU response to Customer’s call, use of the #0 option will enable Customer to talk directly with a qualified SEI representative. In addition, SEI will respond promptly to voicemail and email requests by Customer.

8. Service Procedures.

8.1 General. To the extent that: (i) a product or service licensed to Customer under this Agreement shall fail to materially perform as described in its Documentation, or (ii) to

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the extent Customer shall experience a material difficulty in using a product or service hereunder which appears to be due to failure of the licensed product or service to perform in accordance with its Documentation, or (iii) in the event SEI shall fail to honor the service standards set forth in this Exhibit H, or as shall he mutually agreed to by Customer and SEI in subsequent_amendments to this Agreement, (collectively: (i), (ii), and (iii) shall be called: “Issues”), SEI agrees to track and resolve such Issues as set forth herein.

8.2 Status Report. SEI will prepare and submit to Customer on a quarterly basis a written report reflecting the status of all identified Issues, open items, projects, completed items and new initiatives. Such report shall include statistics on the types of Issues, the total number of Issues, outstanding Issues and resolution times. Such report also shall identify problem trends.

8.3 Priority 1 – Critical Issues. As used herein. Priority 1 Issue means either: a work stoppage or a data corruption incident. SEI promptly will respond to and begin efforts to resolve all Priority 1 Issues. Within one hour after the time that a Priority 1 call from Customer is received, SEI will notify Customer that SEI has commenced efforts to solve the Issue, describe the efforts being undertaken and, if possible, estimate the time for resolution of the issue. SEI will provide to Customer updates and expected resolution reports, with estimated completion time, as such information becomes available to SEI, but in no event shall such updates and information reports be provided any less than 3 hours from the prior update given by SEI to Customer, unless another schedule for such updates is mutually agreed upon by the parties.

8.4 End-to-End Responsibility. SEI will implement and maintain processes that require SEI to assign end-to-end responsibility for each Issue arising from or relating to the systems, products or services provided by SEI pursuant to this Agreement to persons with the appropriate skills and experience required to resolve or manage resolution of such Issue. SEI will monitor, control and manage each Issue related to the systems, products or services provided by SEI pursuant to this Agreement until it is corrected. In addition, for purposes of communications with Customer, SEI shall assign one person as the designated contact person who shall communicate the status of Issues and their resolution. As part of its responsibilities, SEI will carry out root cause analyses, including tying Issues to changes and reviewing high impact Issues, identifying preventative measures, and implementing steps designed to avoid recurrence of issues.

8.5 Third Party Services. SEI will coordinate and manage Third Party Vendors as necessary to resolve issues. Under normal processing circumstances, volumes, and workloads, SEI will seek to provide access to currently identified data extracts by 5:00 am Eastern Time.

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MASTER SERVICES AGREEMENT

EXHIBIT I

CUSTODY SERVICES

SEI Trust agrees to provide Customer with the Custody Services listed below. Customer agrees to pay for Custody Services in accordance with the fees specified on Exhibit A.

1. Safekeeping/Clearing. SEI Trust will keep Customer’s securities and cash safely in a separate account (the “Custodial Account”).

(a) The definition of Securities includes DTC eligible municipal, corporate, and asset backed bonds and equities; securities issued by the either the U.S. Treasury or agencies of the federal government and mortgage pools; and international securities that are either ADRs or settled through Euroclear. Pursuant to this Agreement SEI Trust will not provide services or keep, and therefore specifically exclude from the definition of Custody Services and/or Securities, savings bonds, bank deposit products, open-end mutual funds, Global services and/or dividend reinvestment services.

(b) SEI Trust is under no duty to supervise the Customer’s investments, or to advise or make any recommendation to the Customer with respect to the purchase or sale of any Securities or the investment of any cash. SEI Trust shall be obligated under this Agreement to provide custody for physical Securities, while such Securities are in transmission from or to Depository Trust Company or other subcustodians.

2. Receipt, Delivery and Disposal of Securities. SEI Trust will effect purchases and sales of Securities in accordance with Customer’s Instructions and will take all steps necessary to collect the proceeds of Securities that are sold, redeemed or matured and will deposit the proceeds in the Custodial Account upon receipt. SEI Trust will not be responsible for the collection of proceeds of Securities called for redemption unless notice thereof is published in a national financial reporting service to which SEI Trust subscribes.

3. Free Withdrawal of Assets. Securities may be withdrawn from SEI Trust in accordance with Customer’s Instructions provided that such Instructions are in accordance with sections 7.01 of the Agreement.

4. Withdrawal of Assets vs. Payment and Cash.

(a) In connection with the sale of any Assets, SEI Trust will make delivery of such Assets only against payment therefore in federal funds or by certified or bank’s cashier’s or teller’s or other official check, provided that, consistent with customary practice at the place of delivery, SEI Trust may: (i) make delivery for inspection prior to settlement of sale at buyer’s location, upon delivery to SEI Trust of a proper receipt therefore, to a member of a registered national securities exchange or bank or trust company; and (ii) may accept as payment for such delivered assets an uncertified check of such an entity. In no event will SEI Trust be liable hereunder for not delivering Assets in accordance with the Customer’s Instructions where such delivery is withheld by reason of the purchaser’s inability or unwillingness to make a payment therefore in federal funds or by certified check or bank’s cashier, teller or other official check or as otherwise provided in this Section 4(a).

(b) Any cash included in the Assets may be withdrawn from SEI Trust in accordance with the Customer’s Instructions provided, however, that subject to a transfer or other disposition of Securities

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by bookkeeping entry in connection with SEI Trust’s participation in securities depositories or book entry systems (e.g. DTC, PTC, the Federal Reserve), SEI Trust will make payments of cash to or from the account of Customer only: (i) upon the purchase of Securities or other Assets and delivery of such Securities or other Assets to SEI Trust in proper form for transfer; (ii) to Customer’s account with SEI Trust or with such other bank(s) as Customer may designate by written instructions from time to time; (iii) for payment in connection with the conversion, exchange or surrender of Securities included in the Assets. In making any cash payments, SEI Trust will first receive Instructions requesting such payment and in the case of a payment under item (iii) herein, such Instructions will, except as otherwise authorized pursuant to a resolution duly adopted by the Customer and provided to SEI Trust in accordance with Section 7. 01(c) of the Agreement be in writing in accordance with Section 7.01(a) of the Agreement.

(c) SEI Trust will promptly notify the Customer of all withdrawals from or deliveries to SEI Trust for Customer’s account hereunder in accordance with Section 7.01 (b) of the Agreement.

5. Income Collection/Payment. SEI Trust will collect interest/dividends and post to the Custodial Account when SEI Trust is credited by the custodian. All funds will be transferred via federal funds or netted with other account activities on the day they are posted to the Custodial Account.

6. Registration. As used herein, the term “Assets” will also include all Securities held on behalf of Customer and registered in the account of SEI Trust or SEI Trust’s subcustodian in securities depositories - including but not limited to the Depository Trust Company (“DTC”) and Participant Trust Company (“PTC”) - and book entry systems - including, but not limited to the Federal Reserve book-entry system (“Federal Reserve”), provided that, SEI Trust will provide Customer with the name of any subcustodian promptly following any appointment thereof hereunder and will at all times be fully responsible for all actions or omissions of subcustodian to the same extent as if such actions or omissions were those of SEI Trust.

7. Cash Accounts. All cash received or held by SEI Trust as interest, dividends, proceeds from transfer, and other payments for or with respect to Securities will be placed in the Custodial Account in the Customer’s name or remitted in accordance with properly authorized instructions. Cash distributions denominated in foreign currency will be converted into U.S. dollars to the extent possible. In effecting such conversion, SEI Trust may use appropriate methods or agencies, including SEI Trust’s facilities, at customary rates.

8. Mortgage-Backed Assets. SEI Trust will collect paydowns on mortgage backed assets and post to the Custodial Account by the date they are received by SEI Trust. SEI Trust hereby agrees to make every effort to ensure funds are collected and received on payable date. All funds will be transferred via federal funds or netted with other account activities on the day they are posted to Custodial Account.

9. Security Settlements. SEI Trust will promptly effect purchases and sales of the Assets in accordance with Customer’s Instructions from time to time and will take all steps necessary to collect the proceeds of any Assets which are sold, redeemed or which have matured and will promptly deposit said proceeds in this account provided that SEI Trust will not be responsible for the collection Assets called for redemption or otherwise payable (other than by reason of sale or other disposition by SEI Trust) unless notice thereof is published in national financial reporting services to which SEI Trust subscribes, including but not limited to Financial information Services, J.J. Kenney, and Wall Street Journal or notice is otherwise received by SEI Trust. SEI Trust will not be under any duty to advise or recommend any sales or purchases of Assets for Customer’s account.

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10. Notifications. SEI Trust is to promptly notify the Customer of receipt of notice by SEI Trust of any call for redemption, tender offer, subscription rights, merger, consolidation, reorganization or recapitalization or similar proceeding affecting the Securities held in the Custodial Account, and will take such action in respect thereto as may be directed by the Customer. SEI Trust will have no duty or responsibility to notify the Customer of any calls for redemption which do not appear in standard financial publications. Should any Securities held in any depository be called for a partial redemption by the issuer of such Securities, SEI Trust is authorized in its sole discretion to allot the called portion to the respective holders in any manner deemed to be fair and equitable in SEI Trust’s reasonable judgment.

11. Voting and Other Actions. Neither SEI Trust nor any nominee of SEI Trust will vote any of the Securities held hereunder by or for the Customer, except in accordance with authorized instructions. SEI Trust will deliver, or cause to be executed and delivered, to the Customer all notices, proxies and proxy soliciting materials relative to such Securities, such proxies to be executed by the registered holder of such Securities (if registered otherwise than in the name of the Customer), but without indicating the manner in which such proxies are to be voted.

12. Other. With respect to Securities the issuers of which exist under laws other than those of the United States or any state thereof, SEI Trust’s responsibility is limited to safekeeping without any duty to value, detach coupons, present for conversion or redemption, or take similar action affecting such Securities, except upon authorized instructions from the Customer. SEI Trust’s responsibility will be likewise limited with respect to Securities which have been privately placed, letter stock, certificates of interest or participation in real estate, municipal securities, or other securities as to which information regarding calls, dividends, corporate reorganizations and similar events is not regularly made public in media generally available.

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MASTER SERVICES AGREEMENT

EXHIBIT J

SECRETARY’S CERTIFICATE

I, the undersigned, Secretary of Bryn Mawr Trust Company, organized under the laws of the Commonwealth of Pennsylvania, hereby certifies that the following resolution was duly adopted by the Board of Directors on April 20, 2004, [  ] at a meeting at which a quorum was present and voting; [  ] by unanimous written consent, and that said resolution remains in full force and effect:

“RESOLVED: That this Company has entered into an agreement with SEI Private Trust Company for the provision of trust and custody services as described therein, and that in accordance with section 7.01 of said agreement any two of the following named persons, acting jointly and together, are hereby duly authorized to give instructions on behalf of the Company to SEI Private Trust Company (list the names of persons authorized);

And that the Secretary is hereby directed to file with SEI Private Trust Company a certified copy of this Resolution and a list of the authorized persons with their titles and specimen signatures.”

I further certify that the names, titles and specimen signatures set forth below are true and correct:

NAME	TITLE	SPECIMEN SIGNATURE
JUNE M. FALCONE	SR VICE PRESIDENT	/s/    JUNE M. FALCONE
MARY AGNES LEAHY	VICE PRESIDENT	/s/    MARY AGNES LEAHY
ERNEST D GIGANTE	ASST VICE PRESIDENT	/s/    ERNEST D GIGANTE
______________________________	______________________________

Witness my hand and seal this 20th day of April, 2004.

(Seal)	/s/    ROBERT J. RICCIARDI	4/20/04
	Secretary	Date

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MASTER SERVICES AGREEMENT

EXHIBIT K

Common & Collective Fund Accounting

Operating Guidelines

July 2003

The following provides an operating guideline for non-daily common and collective fund valuations. It details the current roles and responsibilities between the intermediary and SEI Trust.

IMPLEMENTATION

SEI TRUST Services Provided

Establishment of common & collective fund accounting.

•       Set up the initial CTF worksheets Intermediary Role & Responsibilities •       Establish Common Trust Fund as an asset. •       Provide Copy of Trust Agreement to SEI Trust CTF unit. Drafting of Required Documents. These documents include the declaration of trust, disclosure memorandum, and application. Document Filing. •       Provide copy of most recent valuation. •       Establish access to Trust 3000 book-of-records database, to include access to STMTON, for SEI Trust CTF unit. •       Establish SPECTR statement ticklers for each fund. •       Once account is established, link CTF Asset to Account using ASSET CORR. Fields required are Account # and Valuation frequency. •       Provide a single point-of-contact to assist in resolution of inquiries and issues. SEI Trust recommends that this person be a part of your investment unit or operations unit, depending upon what is most appropriate. •       Establish CTF as an account via CLIENT CORR. It is under the miscellaneous section – “Related to CTF asset” =Y and input ticker/cusip of CTF asset. •       Establish frequency of valuation.

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VALUATION PROCEDURE & ONGOING SERVICE SUPPORT Post-implementation support for intermediary inquiries common & collective fund accounting SEI TRUST Services Provided •       Retrieve and review CTF worksheet off Trust3000. •       Equity fund review, which includes reviewing all beginning accruals for accuracy. This review consists of ensuring that if there were prior ending accruals then the same accrual amount is the beginning accruals for the period’s valuation. If the accrual was not received, SEI Trust will research dividend history to ensure accrual is correct. Recalculate all realized gains/losses. •       Bond fund review: Recalculate all accruals based upon type of interest payment and number of days since last interest paid. Recalculate all realized gains/losses. •       Reconcile Fund Balance. •       Reconcile Shares Outstanding. •       Calculate and post income of CTF asset to CTF holders, if applicable. •       Calculate per unit value. •       Calculate estimated annual income. •       Supply price for trades entered by the intermediary. •       Update CTF price. •       Review the accuracy of the NAV calculation to include review of the income posted and supplied price. •       Prepare worksheet for next valuation, including correcting any necessary beginning accruals. •       Confirm and / or defend valuations. •       Troubleshoot and research “questionable” valuations. •       Determine appropriate corrective action if a valuation is deemed incorrect. •       Explain and / or resolve any timing issues in the valuation process if required. •       Understand and explain how Trust3000 processing changes impact valuation. Advise intermediary to make adjustments on Trust3000 when required. •       Troubleshoot and research intermediary issues. •       Conduct post-implementation training as required •       If necessary, enter a limited number of manual prices provided by the intermediary. These are price changes that were not communicated to the STC Pricing Unit prior to the valuation and need modification to result in a

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correct valuation. The number of manual prices should not exceed 10% of the total holdings. •       Review the NAV change from the previous month for reasonableness. Comparing the prior month’s delta between dollars and percentage does this. If the delta is 10% or more, further research is done to determine validity of delta. •       Follow SEI Trust recommended standard pricing and valuation policies. •       Obtain security valuation quotes from a reliable industry resource. •       Manage and respond to CTF price challenges by advisor or sub-advisor. Intermediary Role & Responsibilities •       Pend CTF purchases & sales prior to the end of the valuation period. •       Process voluntary corporate actions by provided deadline. •       Communicate to SEI Trust CTF unit in regards to price changes on individual assets within the fund. These price changes should be completed prior to the day the valuation period ends. •       Understand how Trust3000 processing changes impact valuation. When advised, make necessary adjustments on Trust3000. •       Review all worksheets provided by SEI Trust. •       Obtain broker quotes for securities whose prices cannot be obtained from pricing vendors and update prices accordingly. •       Review and approve all purchases and sales made in the fund, review credit rate calculations & monitoring sub-adviser maintenance of insurance contracts. •       Provide SEI Trust CTF unit with trades that are entered on the last day of the valuation but not yet entered into Trust3000. •       Monitor withdrawal activity to ensure that it adheres to the withdrawal policy and guidelines established in the Declaration of Trust. •       Perform on going due diligence on all sub-advisors.

CTF Valuation

•      Available by the end of the valuation period + 3 business days.

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MASTER SERVICES AGREEMENT

Designated Affiliates

EXHIBIT L

The Bryn Mawr Trust Company, which also includes the following subsidiaries:

Insurance Counsellors of Bryn Mawr, Inc.

BMT Settlement Services, Inc.

Bryn Mawr Brokerage Company, Inc.

BMT Mortgage Company

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AMENDMENT DATED MARCH 2, 2004

MASTER SERVICES AGREEMENT

This Amendment (“Amendment”) dated March 2, 2004 (“Effective Date”), is made to the Master Services Agreement dated September 16, 2003 (the “Agreement”), by and among SEI Investments Management Corporation (“SIMCO”), SEI Private Trust Company (“SEI Trust” collectively SIMCO and SEI Trust are referred to as “SEI”) and Bryn Mawr Trust Company (“Customer”).

Whereas, SEI and Customer desire to amend the Agreement as provided herein.

Now Therefore, in consideration of the premises, covenants, representations and warranties contained herein, and for other good and valuable consideration and intending to be legally bound hereby, the parties agree as follows:

1. Exhibit A. Fees. The Agreement is hereby amended at Exhibit A, “Fees”, Section 1 “Software Services to delete the lines “Employee Benefit Reporting (Current Standard Reports) - Includes Form 5500 Standard EBR Statement Reports”. The Agreement is further amended at Exhibit A “Fees”, Section 2 “Processing Services” to delete the item 2 “Employee Benefit (EB) Account” and fees associated therewith.

2. Ratification of Agreement. Except as expressly amended and provided herein, all of the terms, conditions and provisions of the Agreement are hereby ratified and confirmed to be of full force and effect, and shall continue in full force and effect.

3. Manner of Execution. This Amendment shall be initially executed in multiple, separate, identical counterparts, the compilation of which shall constitute the entire executed Amendment. Signatures shall be enforceable and binding if evidenced either in writing or if evidenced in writing communicated by telefax transmission. Subsequent to the “fax” signature execution of this Amendment, the parties agree to execute said paper original. Failure to execute a paper original shall not affect the enforceability of this Amendment if there exists a fax signature execution of this Amendment by said party.

4. Binding Effect. This Amendment shall be binding upon, and shall inure to the benefit of SEI, Customer and their respective permitted successors and assigns.

IN WITNESS WHEREOF, the parties hereto by their duly authorized officers have executed this Agreement as of the Effective Date.

THE BRYN MAWR TRUST COMPANY		SEI INVESTMENTS MANAGEMENT CORPORATION
By:	/S/     JUNE M. FHALCONE	By:	/S/     ROBERT F. CRUDUP
Name:	June M. Falcone	Name:	Robert F. Crudup
Title:	Sr. Vice President	Title:	Executive Vice President
SEI PRIVATE TRUST COMPANY
By:	/S/     CARL BECNDEL
Name:	CARL BECNDEL
Title:	VP

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AMENDMENT DATED JANUARY 27, 2005

MASTER SERVICES AGREEMENT

This Amendment (“Amendment”) dated January 27, 2005 (“Effective Date”), is made to the Master Services Agreement dated September 16, 2003, as amended (the “Agreement”), by and among SEI Global Services, Inc. (“SGS”) assignee of SEI Investments Management Corporation (“SIMCO”), SEI Private Trust Company (“SEI Trust” collectively SGS and SEI Trust are referred to as “SEI”) and Bryn Mawr Trust Company (“Customer”).

Whereas, SIMCO assigns the Agreement to SGS, a wholly owned subsidiary of SEI investments pursuant to Section 9.04 of the Agreement; and

Whereas, SEI and Customer desire to amend the Agreement as provided herein.

Now Therefore, in consideration of the premises, covenants, representations and warranties contained herein, and for other good and valuable consideration and intending to be legally bound hereby, the parties agree as follows:

1. Exhibit A, Fees. The Agreement is hereby amended at Exhibit A, “Fees”, Section VII “Output Services to add the following entry for CD Rom Archival” after the entry for Advanced Personal Trust Statement Production:

CD Rom Archival

Installation Fee	$700.00
Graphical Statements Monthly Fee Shipping	$135.00/CD Minimum Prevailing Rates
Spectr Statements Monthly Fee Shipping	$135.00/CD Minimum Prevailing Rates

2. Ratification of Agreement. Except as expressly amended and provided herein, all of the terms, conditions and provisions of the Agreement are hereby ratified and confirmed to be of full force and effect, and shall continue in full force and effect.

3. Manner of Execution. This Amendment shall be initially executed in multiple, separate, identical counterparts, the compilation of which shall constitute the entire executed Amendment. Signatures shall be enforceable and binding if evidenced either in writing or if evidenced in writing communicated by telefax transmission. Subsequent to the “fax” signature execution of this Amendment, the parties agree to execute said paper original. Failure to execute a paper original shall not affect the enforceability of this Amendment if there exists a fax signature execution of this Amendment by said party.

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4. Binding Effect. This Amendment shall be binding upon, and shall inure to the benefit of SEI, Customer and their respective permitted successors and assigns.

IN WITNESS WHEREOF, the parties hereto by their duly authorized officers have executed this Agreement as of the Effective Date.

THE BRYN MAWR TRUST COMPANY		SEI GLOBAL SERVICES, INC.
By:	/S/     JUNE M. FALCONE	By:
Name:	June M. Falcone	Name:
Title:	Sr. Vice President	Title:
SEI PRIVATE TRUST COMPANY
By:
Name:
Title:

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EX-10.(P)

Exhibit 10(P)

SEI MUTUAL FUND CLEARING NETWORK CUSTOMER AGREEMENT

THIS SEI MUTUAL FUND CLEARING NETWORK CUSTOMER AGREEMENT (this “Agreement”) is made and entered into as of the 16th day of September, 2003 (the “Effective Date”) by and between SEI Private Trust Company (“SEI”), and The Bryn Mawr Trust Company, a Pennsylvania charted bank and a subsidiary of Bryn Mawr Bank Corporation, having its principal place of business at 801 Lancaster Ave, Bryn Mawr, PA 19010 (“Customer”).

BACKGROUND

WHEREAS, SEI and Customer have entered into a Master Services Agreement pursuant to which, among other things, SEI Investments Management Corporation has agreed to provide Customer with certain trust processing services as described therein;

WHEREAS, Customer acts in a fiduciary capacity or otherwise possesses the authority to act on behalf of its clients who hold shares of certain mutual funds;

WHEREAS, Customer has appointed SEI as custodian of assets held by Customer in a fiduciary or other similar capacity;

WHEREAS, SEI’s Mutual Fund Clearing Network capability provides an electronic platform for automating and managing all aspects of mutual fund processing via interfaces between SEI and various mutual fund companies and mutual fund service providers; and

WHEREAS, Customer desires to utilize SEI’s Mutual Fund Clearing Network capability to facilitate the automation of its daily mutual fund activities on the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the covenants, representations and warranties contained herein, and intending to be legally bound hereby, SEI and Customer agree as follows:

SECTION 1 - DEFINITIONS

As used in this Agreement, the following terms shall have the respective meanings assigned to them below:

1.1 “Affiliate” means, when used with respect to a Person, any other Person directly or indirectly controlling, controlled by, or under common control with the subject Person. For purposes of this Agreement, “control” means the direct or indirect ownership of over 50% of the outstanding voting securities of a Person, or the right to receive over 50% of the profits or earnings of a Person, or the right to control the policy decisions of a Person.

1.2 “Bankruptcy Event” means the Person in question becomes insolvent, or voluntarily or involuntary proceedings by or against such Person are instituted in

1

bankruptcy or under any insolvency law, or a receiver or custodian is appointed for such Person, or proceedings are instituted by or against such Person for corporate reorganization or the dissolution of such Person, which proceedings, if involuntary, shall not have been dismissed within 60 days after the date of filing, or such Person makes an assignment for the benefit of its creditors, or substantially all of the assets of such Person are seized or attached and not released within 60 days thereafter.

1.3 “Business Day” means each day on which the New York Stock Exchange is open for business that a Fund determines its per share net asset value.

1.4 “Clearing Network” means SEI’s proprietary Mutual Fund Clearing Network capability, which enables the automated processing of mutual fund transactions and related accounting, reconciliation, income payment, confirmation, and settlement activity.

1.5 “Client Shareholder” means a client of Customer that holds shares of one or more Funds either directly or through an omnibus position in the name of Customer.

1.6 “Fund Agent” means the transfer agent for a Fund and the Fund’s designees.

1.7 “Funds” means the mutual fund investment companies that make Client Shareholder account information available to Customer pursuant to agreements between such companies and SEI and/or its affiliate.

1.8 “Fund Information” means trade confirmation, accounting, reconciliation, income payment and settlement information transmitted by the Funds or Fund Agents to SEI.

1.9 “Person” or “person” means any corporation, partnership, limited liability company, joint venture, other entity or natural person.

1.10 “Start Date” means the date on which the parties determine that Customer may begin using the Clearing Network as contemplated hereunder, which date shall be agreed upon by the parties in writing.

1.11 “Trade Orders” means instructions properly entered into the TRUST 3000 System by Customer, which instructions request the purchase or redemption of shares of Funds on behalf of Client Shareholders.

1.12 “Trust Account” means a client trust account of Customer which receives certain trust processing, reporting and/or custodial services via the Master Services Agreement.

1.13 “Master Services Agreement” means the “Master Services Agreement” dated as of September 16, 2003, between SEI, SEI Investments Management Corporation and Customer, as the same has been and may hereafter be amended from time to time.

1.14 “TRUST 3000 System” means the SEI’s proprietary TRUST 3000 system, which is used to administer Trust Accounts of Customer pursuant to the Master Services Agreement.

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SECTION 2 - CLEARING NETWORK SERVICES

2.1 Trade Orders. Commencing on the Start Date, Customer will input Trade Orders in accordance with the Operating Guide Cut-Off times. Upon written notice to Customer, SEI may, from time to time and in its discretion, change the Cut-Off time(s) for Trade Orders; provided, however, that transmission of all Trade Orders for each Fund received and accepted by SEI prior to the Cut-Off times will be scheduled to occur before the New York Stock Exchange closes on each Business Day. Trade orders received and accepted by SEI after the close of trading on the New York Stock Exchange on any business day will be treated as if received on the next following Business Day.

2.2 Certifications by Customer. Customer’s entry of each Trade Order shall constitute a certification by Customer that: (i) said Trade Order is true and complete and accurately reflects the instructions of the appropriate Client Shareholder(s); (ii) the entry of said Trade Order is in accordance with the current prospectus for the applicable Fund(s); (iii) each Client Shareholder for whom said Trade Order is entered is a bona fide client of the trust department of Customer; and (iv) Customer has complied with all applicable Federal and state laws relating to said Trade Order, including, but not limited to, laws relating to disclosure and prospectus delivery.

2.3 Settlement Procedures. On each Business Day that the relevant data files are made available from a Fund or a Fund Agent, SEI will retrieve such files and effectuate settlement of the transactions covered by the Fund Information. Each day on which SEI effectuates settlement of any such transactions on behalf of Customer, SEI shall provide Customer with a report indicating the amounts, if any, owed by SEI to Customer or Customer to SEI in connection therewith. Amounts due by either party to the other in connection with any such settlement shall be paid on the date of settlement by wire transfer to a bank account designated by such other party in writing. Should either party sustain a loss as the result of a failure of the other party to wire transfer said amounts on the date of settlement, such other party agrees to remit payment to the party sustaining the loss within five Business Days following a documented request therefor. In addition, should Customer fail to timely wire transfer to SEI any settlement amounts due and owing to SEI hereunder, SEI shall have the right, but not the obligation, to mitigate its potential damages and/or any potential harm in connection therewith, including, without limitation, through the sale or purchase of securities or the cancellation or termination of pending Trade Orders.

2.4 Maintenance of the Clearing Network. Customer acknowledges and agrees that the services to be provided through hereunder are dependent on the TRUST 3000 System, the Clearing Network, and other third party systems utilized by SEI and its Affiliates all being fully operational, and that any and all such services may not be available at all times, including during regularly scheduled maintenance periods.

2.5 Replacement Products/Processes. In the event SEI develops or obtains a new product or a new process to replace the Clearing Network, SEI may use such product or process to provide Customer with services functionally equivalent to those provided hereunder. The fees for services provided using the new product or process shall remain

3

the same as the fees for services provided hereunder; provided, however, that if SEI provides Customer with any additional or enhanced services through use of the new product or process, SEI may charge Customer additional fees for such additional or enhanced services.

SECTION 3 - ADDITIONAL OBLIGATIONS OF CUSTOMER

3.1 Performance of Duties. Customer shall maintain facilities, equipment, and skilled personnel sufficient to perform the duties, functions, procedures, and responsibilities assigned to it under this Agreement and to otherwise comply with the terms of this Agreement. Customer shall conduct each of the forgoing activities in a competent manner and in compliance with (i) all applicable laws, rules, and regulations, including Federal and state securities laws; and (ii) the then-current prospectuses and statements of additional information of the Funds.

3.2 Accuracy of Information; Customer Review.

3.2.1 All information inputted by Customer pursuant to this Agreement shall be accurate and complete and in the format prescribed by SEI. Trade Orders by Customer regarding each Client Shareholder shall be true and correct and will have been duly authorized, as required, by the Client Shareholder. In addition to the foregoing, with respect to each Client Shareholder who is direct shareholder of a Fund, (i) Customer acknowledges that transactions may not be effected until an account application for such Client Shareholder has been completed and such account has been established with the Fund Agent as provided in the Buyer’s Guide, and (ii) Customer shall execute all certifications and other documents (including indemnification documents) as may be required from time to time by SEI, Fund Agent, and/or the Fund to evidence such authority to act for such Client Shareholder in connection with Fund transactions.

3.2.2 Customer shall be responsible for reviewing all transactions relating to the Funds resulting from Trade Orders transmitted and for reviewing all updates to Customer’s Trust Accounts. Customer shall notify SEI in a timely manner (and in no event more than five Business Days after confirmation of any Trade Order or update is posted to a Trust Account) of any inaccuracies, omissions, mistakes or other errors with respect to each such transaction or update. Such notification shall occur by means of confirmed facsimile or electronic mail transmission to the SEI support team for Customer via facsimile numbers or electronic mail addresses specified by SEI from time to time. Failure to notify SEI in the aforesaid manner shall constitute a waiver of any claims Customer or any Client Shareholder may have or may assert against SEI, Fund Agent, or the Fund in connection with such transaction or update.

3.3 Information Relating to Transactions. At SEI’s, any Fund’s, or any Fund Agent’s request, Customer will, at its sole cost and expense, take all reasonable steps to provide information regarding the state of residence or domicile of the Client Shareholders for each Fund. Such information shall be provided in the manner and with the frequency as

4

may be reasonably requested by SEI or such Fund Agent in connection with the Fund’s state securities registrations, sales reports, registration fees, or renewals.

3.4 Shareholder Reports and Other Documents; Solicitation of Proxies; Fund Services Fees. Customer shall timely deliver to each Client Shareholder all reports and other documents provided to it by any Fund or its Fund Agent as may be required by applicable Federal and state laws, rules, and regulations, or by Customer’s trust agreement with its Client Shareholder, provided that Customer has timely received copies of such reports and/or other documents. Customer shall cooperate with Fund Agents in the solicitation and voting of proxies on behalf of the Funds according to Customer’s fiduciary responsibility or policy. Customer and SEI each acknowledge that under separate agreements with various Fund distributors, the other party receives a percentage of the average daily net asset value of certain Fund share classes owned by Client Shareholders, for providing certain shareholder servicing, administration and/or sub-distribution services to such Client Shareholders or other customers who purchase and redeem Fund shares (hereinafter referred to as, “Revenue Generating Funds/Cusips”). The current Fund prospectuses describe such services and fees.

SECTION 4 - FEES

4.1 Fees. For the services provided hereunder, Customer shall pay to SEI the fees set forth on Schedule A attached hereto (the “Base Fees”).

4.2 Fee Increases. SEI may, on 30 days’ prior written notice to Customer, increase the Base Fees no more than once in any twelve-month period, in an amount not to exceed the percentage increase in the Consumer Price Index — All Factors (the “CPI”), as measured by the Bureau of Labor Statistics, since the date of the last price determination hereunder. In addition, SEI may, at any time upon 30 days’ prior written notice to Customer, increase the Base Fees to account for increases in equipment maintenance, telecommunications services, and other third-party provided services, charges, taxes and other fees. In the event of any such increase in said fees, Customer may request and SEI agrees to promptly produce, documentation substantiating the increase.

4.3 Taxes. Customer shall be responsible for paying all sales, use, property, and other taxes, duties, or similar charges assessed, levied, or imposed by any governmental authority or regulatory agency on SEI or Customer in connection with this Agreement and the services and transactions contemplated by this Agreement, except for taxes assessed, levied, or imposed based upon SEI’s property or income. At its option, SEI may include such taxes, duties, and similar charges in its invoices to Customer, in which event Customer shall pay to SEI the taxes, duties, and similar charges so invoiced.

4.4 Payments. Customer agrees to pay all Base Fees to SEI within 30 days following the date of SEI’s invoice for such fees. All payments by Customer hereunder shall be made by Customer to SEI in full, without any right of set-off or deduction. Customer shall pay interest on all amounts past due at the rate of one and one-half percent per month, if such rate is permitted by law, or otherwise at the highest rate permitted by law.

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SECTION 5 - DISCLAIMERS AND LIMITATIONS OF LIABILITY

5.1 Disclaimers.

5.1.1 SEI HEREBY DISCLAIMS ANY AND ALL WARRANTIES RELATING TO THIS AGREEMENT, THE CLEARING NETWORK, AND ANY THIRD PARTY EQUIPMENT, HARDWARE, OR SOFTWARE UTILIZED IN CONNECTION WITH THE CLEARING NETWORK (EXCEPT WITH RESPECT TO THE TRUST 3000 SYSTEM, AND ONLY TO THE EXTENT OF SUCH WARRANTIES CONTAINED IN THE MASTER SERVICES AGREEMENT), INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

5.1.2 The Fund Agent for each Fund has agreed with SEI to accept Trade Orders transmitted through the Clearing Network, and to process such Trade Orders in a timely manner. NOTWITHSTANDING THE FOREGOING SENTENCE, CUSTOMER ACKNOWLEDGES AND AGREES THAT SEI SHALL HAVE NO LIABILITY WHATSOEVER FOR THE TIMELINESS OR COMPLETENESS OF THE TRANSMISSION BY THE FUND AGENT OR PROCESSING OF ANY TRADE ORDERS BY THE FUND AGENT.

5.2 Customer acknowledges that the ability of SEI to provide services via the Clearing Network hereunder is dependent on the timely and proper operation of other third party systems and on SEI’s timely and proper receipt of data from third parties. SEI DOES NOT WARRANT THAT THE SERVICES PROVIDED VIA THE CLEARING NETWORK HEREUNDER WILL BE WITHOUT INTERRUPTION OR DELAY AND/OR BE ERROR FREE, OR THAT ALL ERRORS OR INCONSISTENCIES IN SUCH SERVICES CAN OR WILL BE CORRECTED. HOWEVER, IN THE EVENT THAT THERE IS ANY INTERRUPTION, DELAY OR OTHER PROBLEMS IN SUCH SERVICES, SEI SHALL PROMPTLY ADVISE CUSTOMER OF THE SAME AND SHALL USE ALL REASONABLE, COMMERCIAL EFFORTS TO PROVIDE CLEARING SERVICES MANUALLY, IE. BY TELEPHONE.

5.3 Limitations of Liability. Except for fraud or willful misconduct on the part of SEI, its agents, directors, officers or employees, SEI’s aggregate liability for any and all claims arising under or in connection with this Agreement that relate to the services provided or to be provided via the Clearing Network under this Agreement shall not exceed six months of the fees paid by Customer for such services. IN NO EVENT SHALL SEI BE LIABLE FOR LOST PROFITS OR BUSINESS, LOSS OF GOODWILL, LOSS OF DATA, INTERRUPTION OF BUSINESS, OR FOR ANY EXEMPLARY, PUNITIVE, SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, REGARDLESS OF WHETHER SUCH CLAIM ARISES UNDER ANY THEORY OF TORT, CONTRACT, STRICT LIABILITY, OR OTHERWISE AND REGARDLESS OF WHETHER SEI IS ADVISED OF THE POSSIBILITY OF ANY SUCH DAMAGES.

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5.4 Acknowledgement. The parties acknowledge that the limitations and disclaimers set forth in this Agreement were an essential element in setting consideration under this Agreement.

SECTION 6 - INDEMNIFICATION

6.1 Indemnity. Customer shall indemnify and hold harmless SEI, the Funds, all Fund Agents, their respective Affiliates, and all divisions, subsidiaries, directors, trustees, officers, agents, employees, and assigns of each of the foregoing (collectively, “Indemnified Parties”), against and from any and all demands, damages, liabilities, and losses, or any pending or completed actions, claims, suits, complaints, proceedings, or investigations (including, without limitation, all reasonable attorneys’ fees and other costs, all expenses of litigation or arbitration, and all judgments, fines, and amounts paid in any settlement consented to by the Customer) (collectively, “Claims”) to which any of them may be or become subject to as a result or arising out of (i) any breach by Customer of its obligations under this Agreement; (ii) negligence, willful misconduct, material misrepresentation, or fraud on the part of Customer, its Affiliates or their respective officers, directors, employees, or agents in connection with performance or non-performance under this Agreement; (iii) any inaccurate, unauthorized, or improper information entered by Customer into the TRUST 3000 System; or (iv) Customer’s reliance on any services provided or to be provide by SEI through the use of the Clearing Network unless such Claims are solely attributable to a breach by SEI of its obligations under this Agreement, or to gross negligence, willful misconduct, material misrepresentation, or fraud on the part of SEI, the Fund, the Fund Agent, or their respective officers, directors, employees, or agents.

6.2 Notice and Opportunity to Defend. If any action, suit, proceeding, or investigation is initiated, or any claim or demand is made, against any Indemnified Party for which such Indemnified Party may make a claim against any other party hereto (the “Indemnifying Party”) under Section 6.1, then the Indemnified Party shall give prompt written notice of such action, suit, proceeding, investigation, claim, or demand to the Indemnifying Party and shall cooperate as reasonably requested by the Indemnifying Party in the defense and/or settlement thereof. The Indemnifying Party shall have the opportunity, at its own expense and with its own counsel, to defend or settle such action, suit, proceeding, investigation, claim, or demand; provided, however, that (i) the Indemnified Party shall have the right to participate, at its own expense in the defense of the action, suit, proceeding, investigation, claim, or demand; and (ii) the Indemnifying Party shall not settle such action, suit, proceeding, investigation, claim, or demand without the prior written consent of the Indemnified Party, which consent shall not be unreasonably withheld. The Indemnifying Party shall keep the Indemnified Party informed of all material developments and events relating to the action, suit, proceeding, investigation, claim, or demand.

6.3 Infringement Indemnification. SEI will defend or settle any suit or proceeding brought against Customer based upon a claim that SEI’s use of the Clearing Network to provide services to Customer as contemplated hereunder constitutes an infringement or misappropriation of a U.S. Patent copyright, or trade secret of a third party (an

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“Infringing Claim”), provided that: (i) SEI is notified promptly in writing of the Infringing Claim; (ii) SEI controls the defense or settlement of the Infringing Claim; and (iii) Customer cooperates reasonably, assists and gives all necessary authority and reasonably required information. In the event of an Infringing Claim, SEI will, at its sole option and expense, either procure a license permitting SEI to continue providing Customer with the services provided hereunder, or alternatively, SEI may provide Customer with functionally equivalent services via a non-infringing product. If neither such option is available to SEI on commercially reasonable terms, then SEI may terminate this entire Agreement or any part hereof to the extent necessary to avoid such infringement, provided that any such termination shall not diminish or otherwise affect SEI’s indemnification obligations in this Section 6.3. THIS SECTION 6.3 STATES THE ENTIRE OBLIGATION AND EXCLUSIVE REMEDY OF EACH OF THE PARTIES HERETO WITH RESPECT TO ANY CLAIM THAT THE CLEARING NETWORK INFRINGES OR MISAPPROPRIATES THE PATENT, COPYRIGHT, TRADE SECRET, OR OTHER INTELLECTUAL PROPERTY RIGHTS OF ANY PERSON.

SECTION 7 - TERM AND TERMINATION

7.1 Term. The term of this Agreement shall begin on the Effective Date and, unless terminated pursuant to Section 7.2, shall continue until the sooner of expiration or termination of the Master Services Agreement.

7.2 Termination for Cause. This Agreement may be terminated by either party prior to the scheduled expiration or termination date pursuant to any of the following:

7.2.1 Either party shall have the right to immediately terminate this Agreement by delivering written notice thereof to the other party if the other party materially fails to perform or comply with any provision of this Agreement and does not cure the default within 30 days after receiving written notice thereof from the terminating party specifying the default in detail; provided, however, that if the default is of a nature that it may be cured, but it may not reasonably be cured within said 30-day period, such party may terminate this Agreement only if the other party has not commenced substantial efforts to cure the default within said 30-day period and has not continued in good faith to work to cure the default as soon as reasonably possible thereafter; and

7.2.2 Either party shall have the right to immediately terminate this Agreement by delivering written notice thereof to the other party upon a Bankruptcy Event involving the other party.

7.3 Effect of Termination. The following shall survive the expiration or sooner termination of this Agreement: (i) the provisions of Sections 5, 6 and 8; (ii) any payment obligations of Customer accruing prior to the date of expiration or termination; and (iii) any other provisions necessary to interpret the rights and obligations of the parties hereunder.

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SECTION 8 - GENERAL

8.1 Independent Contractors. In making and performing this Agreement, the parties are acting and shall act as independent contractors. Neither party is, nor will be deemed to be, an agent, legal representative, joint venturer, or partner of the other party for any purpose.

8.2 Amendment. This Agreement may not be amended, supplemented, or otherwise modified except by an instrument in writing signed by both parties.

8.3 Invalidity. Any of the provisions of this Agreement which are determined to be invalid or unenforceable in any jurisdiction shall be ineffective to the extent of such invalidity or unenforceability in such jurisdiction, without rendering invalid or unenforceable the remaining provisions hereof or affecting the validity or unenforceability of any of the terms of this Agreement in any other jurisdiction.

8.4 Waiver. A waiver by either party of a breach or violation of any provision of this Agreement will not constitute or be construed as a waiver of any subsequent breach or violation of that provision or as a waiver of any breach or violation of any other provision of this Agreement.

8.5 Notices. All notices required to be in writing shall be delivered by hand, sent by recognized overnight courier (such as Federal Express, Airborne or UPS), or mailed by certified or registered mail, return receipt requested, postage pre-paid, addressed to the parties as follows, or to such other addresses as may from time to time be given in writing by either party to the other pursuant to the terms hereof:

If to SEI:	If to Customer:
SEI Private Trust Company	The Bryn Mawr Trust Company
One Freedom Valley Drive	330 E. Lancaster Avenue
Oaks, Pennsylvania 19456	Wayne, PA 19087
Attention: General Counsel	Attention: June M. Falcone
(610) 676-1000	(610) 341-1425

8.6 Governing Law. This Agreement and its subject matter shall be governed in accordance with the laws of the Commonwealth of Pennsylvania, excluding its provisions governing conflicts of law.

8.7 Dispute Resolution.

8.7.1 Each of SEI and Customer shall appoint an individual (“Executive Contact”) who shall be the individual responsible for participating in the dispute resolution process described in this Section 8.7. Each Executive Contact shall possess the requisite corporate power and authority to negotiate and implement, on behalf of the party he or she represents, a settlement of any dispute between the parties hereunder. Each of SEI and Customer shall have the right from time to time to appoint a successor to its then-current Executive Contact.

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8.7.2 Except with respect to claims for injunctive relief, the following procedure will be adhered to for all claims, disputes, and controversies arising out of or relating to this Agreement. Either party to this Agreement must notify the other party of the nature of the claim, dispute, or controversy with as much detail as possible regarding the dispute (a “Dispute Notice”). The project managers of the parties shall meet within 10 days after the date of receipt of the Dispute Notice to attempt to reach an agreement about the nature of the dispute and a resolution of the dispute. If the project managers are unable to resolve the dispute within such time period, the Executive Contacts of the parties shall meet within 30 days after the date of receipt of the Dispute Notice to attempt to reach an agreement about the nature of the dispute and a resolution of the dispute. If the Executive Contacts cannot resolve the dispute within such time period or if the terms and conditions of the resolution or settlement of the dispute are breached, the dispute shall be resolved by arbitration pursuant to the provisions of Section 8.7.3 below. Except with respect to the matter in dispute, pending resolution of any dispute covered by this Section 8.7.2 or Section 8.7.3 below, both parties will continue their performance under this Agreement including, without limitation. Customer’s payment of all amounts due to SEI hereunder.

8.7.3 Except with respect to claims for injunctive relief, any claim, dispute, or controversy arising out of or relating to this Agreement that is not resolved in accordance with the provisions of Section 8.7.2 above will be submitted by the parties to arbitration by the American Arbitration Association (the “AAA”) under its then-current Commercial Arbitration Rules, as modified herein or by agreement of the parties. Any such arbitration shall be conducted in Philadelphia, Pennsylvania. Each party irrevocably and unconditionally consents to the jurisdiction of the AAA in any such proceeding and waives any objection that it may have to personal jurisdiction or the laying of venue as specified herein. The parties will cooperate with each other in causing the arbitration proceeding to be conducted in as efficient and expeditious a manner as practicable. Each party will choose one disinterested arbitrator within 30 days of receipt of the notice of intent to arbitrate. Within 60 days of receipt of the notice of intent to arbitrate, the two arbitrators will choose a neutral third arbitrator who will act as chairman. If no arbitrator is appointed within the times herein provided, or any extension of time which is mutually agreed upon, the AAA will make such appointment within 30 days of such failure. Any award rendered by the arbitrators shall be final and binding upon the parties hereto. Judgment upon the award may be entered in any court of record of competent jurisdiction. Nothing herein shall prevent the parties from settling any dispute by mutual agreement at any time.

8.8 Force Majeure. In no event shall either party be liable to the other party for any delay or failure to perform hereunder, which delay or failure to perform is due to any force majeure cause beyond the control of such party, including, but not limited to, acts of God; acts of the public enemy; acts of the government of the United States of America or any State, territory, or political division of the United States of America, or of the District of Columbia; fires; floods; epidemics; quarantine restrictions; strikes (not involving employees, subcontractors, or agents of the party whose performance is delayed or prevented); acts of terrorism; riots; and freight embargoes (each, a “Force Majeure Event”). Notwithstanding the foregoing, in every case the delay or failure to

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perform must be beyond the control and without the fault or negligence of such party. The party to which the Force Majeure Event applies shall take all reasonable steps to mitigate the effect and length of such Force Majeure Event and its direct and indirect, and its intended and unintended, results or consequences. Performance times under this Agreement shall be considered extended for a period of time equivalent to the time lost because of any delay which is excusable under this Section 8.8.

8.9 No Third-Party Beneficiaries. Client Shareholders and other persons not parties to this Agreement (each, a “Third Party”) are not and will not be deemed to be third-party beneficiaries of this Agreement, or to have any contractual relationship with SEI by reason of this Agreement. Customer hereby agrees to indemnify and hold harmless SEI and its Affiliates from and against any and all damages, costs and expenses (including, but not limited to, attorneys’ fees and expenses) payable by any of them in connection with Third Party claims arising out of or relating to any services provided or to be provided by SEI through the use of the Clearing Network not caused by the gross negligence, willful misconduct, material misrepresentation or fraud of SEI or its officers, directors, employees or agents.

8.10 Compliance with Law. Customer shall at its cost and expense comply with all laws, rules, and regulations applicable to its exercise of any of its rights hereunder.

Customer shall take reasonable steps to establish the identity, address and source of funds of each client of Customer and conduct due diligence with regard to, all prospective clients of Customer, and, where applicable, the principal beneficial owners on whose behalf a client of Customer is seeking to make an investment. Customer shall obtain and verify each client of Customer’s true name and permanent address. In the event Customer acts on behalf of a joint investment account, Customer shall establish the name and address of each account holder. In the event a client of Customer is not a natural person, Customer shall obtain the client of Customer’s certificate of articles of organization, a list of the equity holders that hold greater than 10% of the equity, a list of directors and executive officers and evidence that the persons executing any documents on behalf of the client of Customer are properly authorized.

Customer shall retain documentary evidence establishing the identity, address and source of funds of each client of Customer for a period of no less than five years from the client of Customer’s complete redemption from the account. Customer shall furnish, upon request from SEI a copy of all documents concerning the foregoing.

Customer will screen client of Customers to ensure that it does not make an investment, directly or indirectly, for or on behalf of: (1) a person or entity whose name appears on (a) the List of Specially Designated Nationals and Blocked Persons maintained by the U.S. Office of Foreign Asset Control (“OFAC List”) or (b) such other lists of prohibited persons and entities as may be mandated by applicable law or regulation; (2) a Foreign Shell Bank, as defined by the USA PATRIOT Act; (3) a person or entity resident in or whose funds are transferred from, a Non-Cooperative Jurisdiction as defined by the Financial Action Task Force (FATF).

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Customer will also immediately notify SEI if it knows, or has reason to suspect, that a prospective or existing client of Customer, or the principal owners on whose behalf a prospective or existing client of Customer has made or is seeking to make an investment, is: (1) a person or entity whose name appears on a (a) the OFAC List or (b) such other lists of prohibited persons and entities as may be mandated by applicable law or regulation; (2) a Senior Foreign Political Figure, as defined by the USA PATRIOT Act, any member of a Senior Foreign Political Figure’s immediate family, any close associate of a Senior Foreign Political Figure, or any entity controlled by the aforementioned; (3) a person or entity resident in, or organized or chartered under the laws of, a Non-Cooperative Jurisdiction, as defined by the Financial Action Task Force; (4) a person or entity who gives the Customer reason to believe that its funds originate from, or will be or have been routed through, an account maintained by a Foreign Shell Bank or a bank organized or chartered under the laws of a Non-Cooperativc jurisdiction. Customer will not open an account at SEI Private Trust Company if it knows, or has reason to suspect, that a prospective client of Customer or the principal owners of a prospective client of Customer are individuals or entities listed in items (1) through (4) above.

Customer agrees to immediately notify SEI if it becomes aware of any suspicious activity or pattern of activity or any activity that may require further review to determine whether the activity or pattern of activity is suspicious.

8.11 Assignment. Customer shall not assign any of its rights or privileges, or delegate any of its duties or obligations hereunder to any party, whether directly, indirectly or by operation of law, including by merger, stock transfer or otherwise, without the prior written consent of SEI. Any attempted assignment or delegation in derogation of the foregoing shall be null and void. SEI shall have the right to assign or delegate all or part of its rights, responsibilities, or duties hereunder to any of its Affiliates upon the provision of prior written notice to Customer.[]8.12 Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns.

8.13 Headings. The headings contained in this Agreement are for convenience only and shall not affect meaning or interpretation of this Agreement.

8.14 Counterparts. This Agreement shall become binding when any one or more counterparts hereof, individually or taken together, shall bear the original or facsimile signature of each of the parties hereto. This Agreement may be executed in any number of counterparts, each of which shall be an original as against any party whose signature appears thereon, but all of which together shall constitute but one in the same instrument.

8.15 Schedules. The Schedules attached hereto are hereby made a part of this Agreement.

8.16 Entire Agreement. THIS AGREEMENT, INCLUDING ALL SCHEDULES ATTACHED HERETO, CONSTITUTES THE ENTIRE AGREEMENT BETWEEN THE PARTIES CONCERNING THE SUBJECT MATTER HEREOF AND

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SUPERSEDES ALL PRIOR UNDERSTANDINGS AND AGREEMENTS, WHETHER WRITTEN OR ORAL, REGARDING THE SUBJECT MATTER HEREOF.

8.17 Compliance with Regulatory Requirements. If SEI or its affiliates or agents need to take actions in order to comply with legal or regulatory requirements or governmental orders or other requirements affecting the services provided under this Agreement, whether imposed by federal, state, or other governmental or self-regulatory authority, such actions shall not constitute a breach of this Agreement.

IN WITNESS WHEREOF, the parties hereto by their duly authorized representatives, have executed this Agreement as of the date first above written.

The Bryn Mawr Trust Company		SEI Private Trust Company
By:	/s/    JUNE M. FALCONE	By:	/s/    CARL BECHDEL
Name:	June M. Falcone	Name:	Carl Bechdel
Title:	Sr. Vice President	Title:	VP

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EX-10.(Q)

Exhibit 10(Q)

LEASE FOR:

BANK BUILDING AT

BRENTWOOD SHOPPES

224 NORTH POTTSTOWN PIKE,

EXTON, PENNSYLVANIA

LANDLORD:

100 BRENTWOOD ASSOCIATES, LP

TENANT:

THE BRYN MAWR TRUST COMPANY

TABLE OF CONTENTS

Paragraph	Page
BASIC LEASE PROVISIONS	1
1. Leased Premises	4
2. Term	5
3. Lease of Premises	5
4. LANDLORD’S Work and TENANT’S Work	6
5. TENANT Estoppel Certificate	9
6. Rents	9
7. Percentage Rent	9
8. Additional Rent	9
9. TENANT’S Business Taxes	12
10. Place of Payment	12
11. Utilities	12
12. Use and Occupancy	13
13. Trade Fixtures	13
14. Repairs	13
15. Alterations	14
16. Maintenance - No Offensive Practices	14
17. Control of Common Area	15
18. Roof	15
19. Insurance by TENANT – Indemnification	15
20. Right of Access	17
21. Indemnification and Hold Harmless	18

22. Total or Partial Destruction	18
23. Eminent Domain	19
24. Assignment and Subletting	19
25. Custom and Usage	20
26. Performance of TENANT’S Covenants	20
27. Events of Default	20
28. LANDLORD’S Remedies	21
29. Accord and Satisfaction	24
30. Subordination of Lease	24
31. TENANT’S Attornment	25
32. Lease Subject to Financing Requirement	26
33. Entire Agreement	26
34. TENANT Will Quit	26
35. Bankruptcy and Insolvency	26
36. Mechanic Liens	30
37. Miscellaneous	31
38. Recording	31
39. Notice of LANDLORD Default	31
40. Succession	31
41. Limited Liability	32
42. Brokers	32
43. Notices	32
44. Severability	32
45. Corporate Tenants	32
46. Execution of Lease	32
47. Guarantees	33

48. Security	33
49. First Months’ Rent	33
EXHIBIT “A”	34
EXHIBIT “B”	35
EXHIBIT “C”	36
EXHIBIT “D”	38

THIS AGREEMENT, made the 16th day of March, 2004, by and between 100 BRENTWOOD ASSOCIATES, LP (hereinafter called LANDLORD), of the one part and THE BRYN MAWR TRUST COMPANY and subsidiaries (hereinafter called TENANT), of the other part.

BASIC LEASE PROVISIONS

The following Basic Lease Provisions embody the agreement of the parties hereto, subject to further terms and conditions hereinafter set forth elsewhere in this Lease.

(1) Term: 10 years.

(2) Projected Possession Date: April 1, 2004.

(3) Rent Commencement Date: April 1, 2004.

(4) Lease Expiration Date: March 31, 2014, unless renewed as described below.

(5) Fixed Minimum Rent: TENANT shall pay to LANDLORD a guaranteed annual minimum rent (“Fixed Minimum Rent”) for each of the following periods during the Term as follows:

	TIME PERIOD	ANNUAL AMOUNT		MONTHLY AMOUNT
1.	From the Rent Commencement Date through the end of the sixtieth full calendar month	$	150,000.00	$	12,500.00
2.	From the beginning of the sixty-first month through the end of the one hundred twentieth month.	$	172,500.00	$	14,375.00

TENANT shall pay for all utilities, including but not limited to, electric, water and sewer, consumed within the Leased Premises from the Possession Date and thereafter throughout the Term.

Each such installment of Fixed Minimum Rent shall be due and payable on or before the first day of each calendar month in the Original Term, in advance, at the office of LANDLORD or at such place as may be designated by LANDLORD from time to time, without any prior demand therefor and without any deduction or setoff whatsoever, the first installment to be paid on the Rent Commencement Date whether or not the Rent Commencement Date is the first day of a calendar month. In the event that the Rent Commencement Date of the Term shall be a day other than the first day of a calendar month, TENANT’S first payment of Fixed Minimum Rent shall be prorated for the fractional month between the Commencement Date and the first day of the first full

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calendar month in the Term, on a per diem basis (calculated on a thirty (30) day month). LANDLORD may accept any payment by TENANT of a lesser amount than shall be due from TENANT without prejudice to any rights or remedies which LANDLORD may have against TENANT. Any endorsement or statement on any check accepted by LANDLORD, or any statement in correspondence accompanying such check, that acceptance of such lesser amount is payment in full, shall be given no effect. All rent shall be paid in United States currency and shall, if other than cash, be drawn on a United States bank.

Option.

Provided that TENANT is not in default, TENANT shall be entitled to exercise an option to extend the term of this Lease for a period of ten (10) years beginning upon the expiration of the Original Term. TENANT shall automatically exercise its option, unless it provides LANDLORD with written notice of its intention not to exercise the option not less than one hundred eighty (180) days prior to the expiration of the Original Term. In the event that TENANT exercises said option, TENANT shall pay to LANDLORD a guaranteed Annual Minimum Rent (“Fixed Minimum Rent”) for each of the following time periods during the Option Term as follows:

	TIME PERIOD	ANNUAL AMOUNT		MONTHLY AMOUNT
1.	From the Option Commencement Date through the end of the sixtieth full calendar month	$	198,375.00	$	16,531.25
2.	From the beginning of the sixty-first month through the end of the one hundred twentieth month.	$	228,131.25	$	19,010.94

Each such installment of Fixed Minimum Rent shall be due and payable on or before the first day of each calendar month in the Option Term, in advance, at the office of LANDLORD or at such other place as may be designated by LANDLORD from time to time without any prior demand therefore and without any deduction or set-off whatsoever, the first installment to be paid on the first day of the first calendar month of the Option Term. LANDLORD may accept any payment by TENANT of a lesser amount than shall be due from TENANT without prejudice to any rights or remedies which LANDLORD may have against the TENANT. Any endorsement or statement on any check accepted by LANDLORD or any statement in correspondence accompanying said check, that acceptance of such lesser amount is payment in full, shall be given no effect. All rent shall be paid in United States currency and shall, if other than cash, be drawn on a United States bank.

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Second Option.

Provided that TENANT is not in default, TENANT shall be entitled to exercise a second option to extend the term of this Lease for a period of nine (9) years and eleven (11) months beginning upon the expiration of the Option Term. TENANT shall automatically exercise its option, unless it provides LANDLORD with written notice of its intention not to exercise the option not less than two hundred seventy (270) days prior to the expiration of the Option Term. In the event that TENANT exercises said option, TENANT shall pay to LANDLORD a guaranteed Annual Minimum Rent (“Fixed Minimum Rent”). The amount of the Fixed Minimum Rent shall be determined as follows:

Between two hundred seventy (270) and two hundred forty (240) days prior to the expiration of the Option Term, LANDLORD shall submit to TENANT in writing a statement of what it considers to be the Fair Rental Value the Leased Premises for the first sixty (60) months of the second Option Term and for the last fifty-nine (59) months of the second Option Term. In the event TENANT does not object to same in writing within fifteen (15) days after receipt of LANDLORD’S statement, the amounts set forth shall become the Fixed Minimum Rental during the second Option Term. If the TENANT objects to the Fair Rental Value established by LANDLORD in writing within the time period set forth above, then the parties shall each appoint an appraiser, competent in the field of commercial real estate, which appraisers shall then appoint a third independent appraiser, competent in the field of commercial real estate. The three appraisers shall then together determine a Fair Rental Value of the Leased Premises for the second Option Term. In the event of a disagreement between the three, a majority decision shall be binding. The cost of such appraisers shall be split equally between both parties and the appraisers’ determination shall be final and unappealable, subject to the conditions below.

In no event shall the Fixed Minimum Rental for the second Option Term be less than Nineteen Thousand Ten ($19,010.94) Dollars and ninety-four cents per month.

After the Fair Rental Value for the Second Option Term is established, TENANT shall have ten (10) days to deliver a written objection to the Fair Rental Value as determined by the appraisers to LANDLORD. If TENANT fails to make such a written objection, the Fair Rental Value determined by the appraisers shall control. If TENANT objects to the Fair Rental Value, said objection shall operate as a notice that TENANT does not wish to exercise its option to renew the Lease for a second Option Term, notwithstanding the fact that the Lease had previously automatically renewed and this Lease shall terminate at the end of the First Option Term. Any such notification by TENANT shall require TENANT to pay all costs associated with the process to determine the Fair Rental Value, including, but not limited to, the costs related to all three appraisers and other related costs incurred by LANDLORD.

(8) TENANT’S Proportionate Share: 20.43%.

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(9) Gross Square Feet of the Leased Premises: approx. 2500 with 3 drive-thru lanes.

(10) TENANT’S Name: The Bryn Mawr Trust Company.

(11) Security Deposit: Not applicable.

(12) Reimbursements: Additional Rent charges begin on the Possession Date:

TENANT’S Proportionate Share of Taxes

TENANT’S Proportionate Share of Common Area Maintenance

(13) Maintenance, Repairs, Improvements: TENANT is responsible for any improvements to the building and structures on the Leased Premises and all costs related to the maintenance and repair of the building during the term of the Lease.

(14) Use: Bank.

(15) Exhibit “A” Site Plan

Exhibit “B” TENANT’S Work – To be approved by LANDLORD.

Exhibit “C” Signage – To be approved by LANDLORD.

Exhibit “D” Waiver of Liens – To be approved by LANDLORD.

WITNESSETH:

LANDLORD owns and/or controls certain land situate at the Shopping Center Location and is erecting, or has erected thereon, a shopping center (hereinafter sometimes called “the Center” and sometimes called “the Shopping Center”). TENANT desires to occupy a building at the Center. The TENANT’S building is outlined in red on the Plot Plan of the CENTER attached hereto as Exhibit “A.”

NOW THEREFORE, KNOW ALL MEN BY THESE PRESENTS, that for the rents reserved, the mutual consideration recited herein, and respectively intending to be legally bound hereby, the parties agree, as follows:

1. Leased Premises: LANDLORD does demise, lease, and let unto TENANT, and TENANT does rent and take from LANDLORD, the Leased Premises, as outlined in red on the Plot Plan attached hereto as Exhibit “A”, it being understood that all dimensions are approximate, together with the right to use, in common with all others entitled to such use, all of such parking areas, driveways, footways, and loading facilities in the Center (hereinafter called “Common Areas”) intended for common use and benefit as may be provided and designated from time to time by LANDLORD, subject however to the terms and conditions of this Agreement; the right of LANDLORD from time to time to alter the site plan at its sole discretion; to reasonable rules and regulations for the use thereof as prescribed from time to time by LANDLORD; present and future restrictions, easements, and any agreements affecting the

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Leased Premises. Common Areas shall not include any loading areas, driveways and parking spaces to which any other party is entitled to the exclusive use as determined by LANDLORD.

LANDLORD shall take all reasonable action to ensure that there are adequate parking spaces in the parking areas adjacent to the leased premises as marked with the letter “P” on the attached Exhibit A, including but not limited to prohibiting employees of tenants at the Shopping Center from parking in such parking areas; revising the LANDLORD’S parking rules and regulations, if necessary; enforcing LANDLORD’S rules and regulations, especially with respect to the Tire Center occupying the building behind the Leased Premises by prohibiting parking of the vehicles left for service in the parking areas identified on Exhibit “A” hereto.

2. Term: The term of this Lease shall commence upon the Possession Date and shall extend and continue for the Term period from the Possession Date.

If TENANT is unable to obtain all required governmental approvals in final unappealable form for TENANT’s Work (to include three drive through lanes, one of which is an ATM lane) on or before one hundred eighty (180) days after the Rent Commencement Date or on or before one hundred eighty (180) days from the date that final plans are submitted for governmental approval, whichever is later, either party shall have the right to terminate this Lease by notice given in writing within fifteen (15) days thereafter.

If TENANT is unable to obtain final unappealable approval for a branch bank office at the Premises from the Pennsylvania Department of Banking and the Federal Reserve Board within 90 days after the Rent Commencement Date (of if TENANT so elects upon receipt of a decision denying a branch bank application by any of the foregoing authorities), either party shall have the right to terminate this Lease by giving notice in writing to the other.

Notwithstanding anything to the contrary set forth herein, this Lease shall not become effective, and TENANT shall not be bound by the terms of this Lease unless and until TENANT’s Board of Directors approves the Lease. It is anticipated that TENANT’s Board of Directors will consider this Lease on March 20, 2004. If TENANT’s Board of Directors approves the Lease, TENANT shall promptly notify LANDLORD, in writing, of the Board’s approval. If TENANT’s Board of Directors does not approve this Lease, this Lease will become null and void and TENANT shall pay to LANDLORD the amount of $410.00 per day for the period January 8, 2004 to March 20, 2004. TENANT shall promptly notify LANDLORD if TENANT’s Board of Directors does not approve this Lease.

3. Lease of Premises: LANDLORD, in consideration of the Rent to be paid and the covenants to be performed by TENANT, does hereby demise and lease unto TENANT, and TENANT hereby leases and takes from LANDLORD, for the Term, at the rental, and upon the covenants and conditions herein set forth, the commercial space referred to herein as the Premises situated or to be situated in LANDLORD’S Building, as the case may be as set out in Exhibit “A”.

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4. LANDLORD’S Work and TENANT’S Work:

A. LANDLORD will not perform any work at the Premises. TENANT accepts the Premises in an as-is condition existing on the Possession Date. TENANT acknowledges that neither LANDLORD nor LANDLORD’S agent has made any representations as to the present or future condition of the Premises or the presence or absence of hazardous materials therein.

B. TENANT shall fully and completely remodel the Premises in accordance and the Plans and Specifications referred to below. TENANT shall deliver to LANDLORD within one hundred twenty (120) days of execution of this Lease detailed Plans and Specifications (which shall include cooling and heating load calculations, electric panel board schedules and loads and such other details as may be required by LANDLORD’S engineers) prepared by TENANT’S licensed architect disclosing and describing the remodeling of the Premises. LANDLORD shall review said Plans and Specifications and approve or disapprove the same within ten (10) days thereafter, which approval will not be unreasonably withheld, conditioned or delayed. If LANDLORD and TENANT cannot agree on approved plans within sixty (60) days after submission of the Plans and Specifications to LANDLORD, either party may cancel this Lease.

C. All work required under this Section and all other alterations to the Premises performed by TENANT pursuant to this Lease are collectively referred to as “TENANT’S Work.” All of TENANT’S Work shall be completed at TENANT’S sole cost and expense. In performing TENANT’S Work, TENANT shall comply with the following requirements:

(1) In addition to, and not in lieu of the other policies of insurance required by this Lease, at all times between the start and completion of TENANT’s Work (such period is herein referred to as “TENANT’S Construction Period”), TENANT, at its own cost and expense, shall maintain in effect with a responsible insurance company, a policy of all risk builder’s risk insurance in the standard form for the State where the Shopping Center is located. Said insurance shall cover the full replacement value of all work done and fixtures and equipment installed or to be installed at the Premises by TENANT, without coinsurance and with a deductible clause not to exceed Ten Thousand ($10,000.00) Dollars.

(2) At all times during TENANT’S Construction Period, TENANT’S contractors and subcontractors shall maintain in effect worker’s compensation insurance as required by the laws of the State in which the Shopping Center is located.

(3) Repair and/or reconstruction of all or any portion of TENANT’S Work damaged or destroyed by any casualty occurring during TENANT’S Construction Period shall be commenced by TENANT as soon as possible after such casualty.

(4) Any approval or consent by LANDLORD of any or all of TENANT’S criteria, systems, plans, specifications or drawings shall neither constitute an assumption of responsibility by LANDLORD for any aspect of such criteria, systems, plans,

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specifications or drawings including, but not limited to, their accuracy or efficiency nor obligate LANDLORD in any manner with respect to TENANT’S Work and TENANT shall be solely responsible for any deficiency in design or construction of all portions of TENANT’S Work.

(5) TENANT shall obtain and pay for all necessary permits and shall pay all other fees required by public authorities or utility companies with respect to TENANT’S Work.

(6) TENANT shall maintain the Premises and the Common Areas adjoining the same in a clean and orderly condition during construction. TENANT shall promptly remove all unused construction materials, equipment, shipping containers, packaging, debris and waste from the Shopping Center at TENANT’S expense. TENANT shall contain all construction materials, equipment, fixtures, merchandise, shipping containers and debris within the Premises. Notwithstanding the foregoing, TENANT may utilize the drive through lanes or adjacent parking area during construction of TENANT’s Work, but TENANT shall not interfere with the operation of or access to the other areas of or buildings in the Shopping Center.

(7) TENANT agrees to engage the services of only such contractors or subcontractors as have been duly licensed by the authority having jurisdiction over the appropriate profession to perform any portion of TENANT’s work for TENANT in or upon the Leased Premises.

(8) At any time and from time to during the performance of TENANT’s work, LANDLORD, agent, LANDLORD’S architect and/or LANDLORD’S general contractor may enter upon the Leased Premises and inspect the work being performed by TENANT upon reasonable prior notice during normal business hours. In the event of a threat to life or property, LANDLORD and/or LANDLORD’S architect and general contractor may take such steps as they may deem necessary or desirable to assure the proper performance by TENANT of TENANT’s work and/or to protect the building and/or any property adjacent to the Leased Premises. In addition, TENANT’s Work shall be performed in a thoroughly first class and workmanlike manner and shall be in good usable condition at the date of completion.

(9) TENANT’S Work shall be coordinated with all work being performed or to be performed by LANDLORD and other occupants of the Shopping Center to the end that TENANT’S Work will not interfere with the operation of the Shopping Center or interfere with or delay the completion of any other construction within the Shopping Center, and each such contractor and subcontractor shall comply with all procedures and regulations prescribed by LANDLORD or Agent for integration of TENANT’S Work with that to be performed in connection with any construction in the Shopping Center and in connection with the operation of the Shopping Center.

(10) During TENANT’s WORK, TENANT or its contractors or subcontractors may use the parking area adjacent to the Leased Premises for storage, handling and moving materials and equipment. It shall be TENANT’s responsibility to cause each contractor and subcontractor to maintain continuous protection of adjacent property and improvements against damage by reason of TENANT’s Work.

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(11) TENANT shall comply with and shall cause its Contractors to comply with paragraph 36 of this Lease. TENANT shall promptly pay all contractors and materialmen so as to minimize the possibility of a lien or claim of lien being filed with respect to the Premises or the Shopping Center, and should any such lien be made or filed, TENANT shall cause the same to be discharged by bond or otherwise within twenty (20) days after written request by LANDLORD. If TENANT shall fail to cause such lien or claim of lien to be bonded against or to be discharged within the period aforesaid, then, in addition to any other right or remedy which LANDLORD may have under this Lease, at law or in equity, LANDLORD may, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien or claim of lien by deposit or by bonding proceedings, and in any such event, LANDLORD shall be entitled, if LANDLORD so elects, to compel the prosecution of any action for the foreclosure of such lien or claim of lien by the lienor with interest, costs and expenses. Any amount so paid by LANDLORD and all costs and expenses incurred by LANDLORD in connection therewith or in connection with insuring the title to the Shopping Center or any interest herein free of such lien or claim of lien, together with a late charge thereon, from the respective dates of LANDLORD’S making of the payment and incurring of the cost and expense, shall constitute Additional Rent payable by TENANT under this Lease and shall be paid by TENANT to LANDLORD on demand.

D. Within ten (10) days after initially opening the Premises for business with the public, TENANT shall supply to LANDLORD the following:

(1) An executed and acknowledged release of mechanic’s liens with respect to the Premises executed by TENANT’S general contractor.

(2) Properly issued certificates evidencing acceptance or approval of the Premises by appropriate governmental authorities, and a Certificate of Occupancy or similar certificate from all necessary government agencies or bodies.

(3) A set of as-built plans and specifications for TENANT’S Work prepared and sealed by TENANT’S architect, together with names and addresses of TENANT’S General Contractor.

E. Nothing in this Lease shall be construed as in any way constituting a consent or request by LANDLORD, expressed or implied, by inference or otherwise, to any contractor, subcontractor, laborer, or materialman for the performance of any labor or the furnishing of any materials for any specific or general improvement, alteration, or repair of or to the Premises or to any buildings or improvements thereon, or to any part thereof. Notwithstanding anything in this Lease, or in any other writing signed by LANDLORD to the contrary, neither this Lease nor any other writing signed by LANDLORD shall be construed as evidencing, indicating, or causing an appearance that any erection, construction, alteration or repair to be done, or caused to be done, by TENANT is or was in fact for the immediate use and benefit of LANDLORD. TENANT covenants and agrees that TENANT shall have no right, authority or power to bind LANDLORD, or any interest of LANDLORD in the Premises or Shopping Center, for any claim for labor or materials or for any other charge or expense incurred

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in connection with the construction of any improvements on the Premises or Shopping Center, and TENANT further covenants and agrees that no liens or claims of whatever nature, including without limitation, liens or claims for labor performed on, or materials delivered to or stored at the Premises or Shopping Center, will attach to the Premises or Shopping Center.

5. TENANT Estoppel Certificate:

A. TENANT agrees to at any time and from time to time, within ten (10) days after LANDLORD’S written request, to execute, acknowledge and deliver to LANDLORD a written instrument certifying the Possession Date, that TENANT has accepted possession of the Leased Premises and is open for business, that this Lease is unmodified and in full force and effect (or if there have been modifications, that it is in full force and effect as modified and stating the modifications), the dates to which Fixed Minimum Annual Rent, Additional Rent and other charges have been paid in advance, if any, and stating whether or not to the best knowledge of the signer of such certificate, LANDLORD is in default in the performance of any covenant, agreement or condition contained in this Lease and, if so, specifying each such default of which the signer may or should have knowledge; and certifying such other matters as may be reasonably requested by LANDLORD.

B. In the event that TENANT fails to provide a TENANT’S Estoppel Certificate within ten (10) days after LANDLORD’S written request therefore, TENANT does hereby irrevocably appoint LANDLORD as attorney-in-fact of TENANT, coupled with an interest, in TENANT’S name, place and stead to sign and deliver TENANT’S Estoppel Certificate as if the same had been signed and delivered by TENANT.

6. Rents: Starting on the Rent Commencement Date, TENANT agrees to pay, without set-off or deduction for any purpose, all rents, Additional Rent, and other sums payable as rent which are reserved or provided to be paid by TENANT under this Lease.

Minimum Rents: TENANT shall pay to LANDLORD the Fixed Minimum Rent as set forth previously in this Lease on the page entitled BASIC LEASE PROVISIONS during the term of this Lease and any extension or renewal thereof in equal monthly installments, in advance, on or before the first day of each month. The monthly installments of Fixed Minimum Rent for any portion of a month at the beginning or end of the term shall be apportioned on a per diem basis.

7. Percentage Rent: Deliberately Omitted.

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8. Additional Rent: In addition to the Fixed Minimum Rent as set forth in this Lease, TENANT agrees to pay to LANDLORD, in advance, without deduction, set-off or abatement, the following additional sums, beginning upon occupancy, the payment of which shall be considered as “Additional Rent” hereunder, shall be used for the purpose hereinafter set forth without any accounting therefore to TENANT, and shall be subject to all provisions of this Lease and of law as to default in the payment of rent:

A. Taxes:

(1) TENANT shall pay in each Lease Year during the term of this Lease, as Additional Rent, a proportionate share of all real estate taxes, ad valorem and assessments, general and special assessments, taxes on real estate rental receipts, or any other tax, other than federal state or local income tax, imposed upon or levied against real estate or upon owners of real estate as such rather than persons generally, payable with respect to or allocable to the Shopping Center including all land and all other buildings and improvements situated thereon, together with the reasonable cost (including fees of attorneys, consultants and appraisers) or any negotiation, contest or appeal pursued by LANDLORD in an attempt to reduce any such tax, assessment or charge, the same being collectively referred to herein as “Taxes”.

(2) In addition to TENANT’S Proportionate Share of Taxes, TENANT shall pay to the appropriate agency any and all sales and excise taxes (not including, however, LANDLORD’S federal, state or local income taxes) levied, imposed or assessed by any governmental body or other taxing authority upon any rent payable hereunder.

(3) In the event that the first or last Lease Years shall consist of less than twelve (12) full calendar months, the provisions of this Section shall apply, but TENANT’S liability for TENANT’S Proportionate Share of any Taxes for such shorter Lease Year shall be subject to an equitable adjustment.

B. TENANT’S Proportionate Share of the expenses of maintaining the Common Areas in the Shopping Center shall include, without limitation, all costs and expenses of operating, managing, maintaining, repairing the Common Areas of Shopping Center, excluding any repairs, maintenance or the like of the other building and structures in the Shopping Center,; a fifteen (15%) percent administrative fee, not including any management or audit fees; lighting, signing, cleaning, painting, striping, policing and security of the Common Areas (including the cost of uniforms, equipment and employment taxes); removal of snow, ice, trash and debris; regulation of traffic; costs and expenses of inspecting and depreciation of machinery and equipment used in the operation and maintenance of the Common Areas and personal property taxes and other charges incurred in connection with such equipment; costs and expenses or repair or replacement of paving, curbs, walkways, landscaping, drainage, pipes, ducts, conduits and similar items, and lighting or facilities; costs and expenses of planting, replanting and replacing flowers, shrubbery and planters; cost of water and sewer if not metered separately; services, if any, furnished by LANDLORD for non-exclusive use of all tenants; promotional advertising for entire Center.

C. TENANT’S Proportionate Share of the cost of insuring the Common Areas of the Shopping Center, including but not limited to, liability insurance for personal injury, death and property damage, insurance against fire, extended coverage, theft or other casualties, workmen’s compensation insurance covering personnel, fidelity bonds for personnel, insurance against liability for defamation and claims of false arrest occurring on and about the Common Areas.

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D. Any provision of this Lease to the contrary notwithstanding, at LANDLORD’S option, TENANT shall pay as additional rent, a late charge in the amount of five (5%) percent of the outstanding delinquent balance for any payment of rent or additional rent not made within ten (10) days after the due date thereof to cover the extra expense involved in handling delinquent payment.

E. TENANT’S Proportionate Share of Common Area Maintenance (Para. B) and Common Area insurance (Para. C) shall be paid by TENANT in equal monthly installments in such amounts as are estimated and billed for each Lease Year by LANDLORD beginning upon possession and at the beginning or each successive Lease Year during the term of this lease, each such installment being due on the first day of each calendar month. Within sixty (60) days after the end of each Lease Year, or such reasonable (in LANDLORD’S determination) time thereafter, LANDLORD will certify to TENANT the amount of Common Area Maintenance (Para. B) and Common Area Insurance (Para. C) for said Lease Year and the amount of TENANT’S Proportionate Share thereof. The Proportionate Share paid or payable for each Lease Year shall be adjusted between LANDLORD and TENANT, both LANDLORD and TENANT hereby agreeing that TENANT shall pay LANDLORD or LANDLORD shall credit to TENANT’S account (or, if such adjustment is at the end of the term of the Lease, pay TENANT), as the case may be, within thirty (30) days of the aforesaid certification to TENANT, such amount necessary to effect such adjustment. The failure of LANDLORD to provide such certification within the time prescribed above shall not relieve TENANT of its obligations generally for the specific Lease Year in which any such failure occurs.

F. TENANT’S Proportionate Share of Taxes in each tax year during the Term, including all amounts payable by LANDLORD for real estate taxes, ad valorem taxes and assessments (general and special), taxes on real estate rental receipt, or any other tax upon or levied against real estate or upon owners of real estate as such, including taxes imposed on leasehold improvements which are assessed against LANDLORD and the cost of contesting such taxes, all with respect to the property making up the Shopping Center. TENANT’S Proportionate Share shall be 20.43%. The charge required hereunder shall be paid by the TENANT within fifteen (15) days after TENANT has received written notice from the LANDLORD together with a photocopy of the applicable tax bill. Nothing herein contained shall be construed to include as a tax which shall be the basis of TENANT’S Proportionate Share, any inheritance, estate, succession, transfer, gift, franchise, corporation, income or profit tax or capital levy that is or may be imposed upon LANDLORD.

Subject to the written approval of LANDLORD and any mortgagee of the Shopping Center, TENANT may, if it shall so desire, endeavor at any time to contest any tax or assessment against the Shopping Center to obtain a reduction in the assessed valuation upon the Shopping Center for the purpose of reducing any such tax assessment. Upon the request of TENANT, but without expense or liability to LANDLORD, LANDLORD will cooperate with TENANT and will execute any document which may be reasonably necessary and proper for any proceeding. Under no circumstances shall TENANT HAVE THE RIGHT TO WITHHOLD ANY PAYMENTS TO LANDLORD pursuant to this Lease in the event of such contest, nor shall LANDLORD have any obligation to withhold the payment of any real property taxes or assessments levied or assessed by any lawful authority against the Shopping Center. If

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TENANT shall have paid an amount in excess of its Proportionate Share of Taxes and assessments for any year as a result of a reduction in total taxes and assessments for such year, such Proportionate Share of such excess shall be credited to TENANT’S tax obligation provided for in this Lease when all refunds to which LANDLORD shall be entitled from a taxing authority with respect to such year shall have been received by LANDLORD.

For the tax year in which the Lease Term commences or terminates, the provisions of this section shall apply, but TENANT’S liability for TENANT’S Proportionate Share of any taxes for such year shall be subject to a pro rata adjustment based upon the number of days of such tax year falling within the respective portion of the Lease Term.

TENANT shall also pay to the appropriate agency all sales and excise taxes levied, imposed or assessed by any taxing authority upon any rentals payable hereunder. TENANT shall also be responsible for and pay within the time provided by law all taxes imposed upon TENANT’S personal property, trade fixtures, and stock-in-trade and use and occupancy taxes applicable to TENANT’s Use of the Premises.

9. TENANT’S Business Taxes: TENANT shall pay before delinquency any and all taxes, assessments, license fees and public charges levied, assessed or imposed upon its business operation, or based upon the use and occupancy of the Leased Premises as well as upon its leasehold interest, trade fixtures, furnishing, equipment, leasehold improvements (including, but not limited to, those required to be made pursuant to TENANT’S Work), alterations, changes and additions made by TENANT, merchandise and personal property of any kind owned, installed or used by TENANT, in or upon the Leased Premises. In the event any such items of property are assessed with property of LANDLORD, then such assessment shall be equitably divided between LANDLORD and TENANT. LANDLORD shall determine the basis of dividing any such assessments and such determination shall, if not arbitrary or capricious, be binding upon both LANDLORD and TENANT.

10. Place of Payment: TENANT agrees to pay all rents and other sums and charges herein prescribed to be paid by TENANT to LANDLORD’S original address or to such other person or to such other place or places as shall be designated by LANDLORD to TENANT in writing from time to time hereafter.

11. Utilities: TENANT shall promptly pay all charges for telephone, heat, air conditioning, lighting, water, sewer, gas (if supplied), electricity, sprinkler service (if any) and all other utilities and utility services used or consumed in or upon the Leased Premises. TENANT shall be responsible for such charges as of the Possession Date. LANDLORD does not undertake to supply heat, light, gas, power or any other service or utility leased, except to provide the initial service lines to the Leased Premises. TENANT agrees to contract separately with the appropriate utility company for said service or utility. LANDLORD shall not be liable in damages or otherwise, whether or not LANDLORD shall supply a utility service to the Leased Premises, for any interruption or impairment in the supply of such utility service, nor shall any such interruption or impairment constitute a breach by LANDLORD of the terms and conditions of this Lease nor shall any such interruption constitute a ground for an abatement of any sums payable by TENANT hereunder, unless such interruption or impairment is caused by

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LANDLORD’S gross negligence or willful misconduct. TENANT shall not at any time, overburden or exceed the capacity of the mains, ducts, feeders, conduits or other facilities by which utility services are supplied to, distributed in or serve the Leased Premises.

12. Use and Occupancy: Except as otherwise provided in the following sentence, the Leased Premises shall be used only for TENANT’S Use as set forth in the Basic Lease Provisions on Page 1 and for no other purpose whatsoever. In the event LANDLORD shall consent to an assignment of this Lease or to a subletting of the Leased Premises pursuant to Paragraph 23 below, the assignee or subtenant may use the Leased Premises for such other retail sales or service business to which LANDLORD shall consent provided, however, that in no event shall such assignee or subtenant use the Leased Premises for any use (other than TENANT’S Use) which would violate or be in conflict with the provisions of any lease or other written agreement affecting any portion of the Center then in effect, or any local, state or Federal laws.

During the term of this Lease, TENANT shall not directly or indirectly engage in any business which is similar to or competing with TENANT’S Use within a radius of two (2) miles from the outside boundary of the Center. TENANT shall not perform any acts or carry on any practices that may injure the building or be a nuisance or menace to other tenants in the Center or carry on any unlawful activities upon the Leased Premises.

During the term of this Lease, LANDLORD shall not use or allow any other person or entity (except TENANT) to use any portion of the Shopping Center for the conduct of any banking business, including the taking of deposits, making of loans or providing trust services. LANDLORD acknowledges that the Shopping Center is to be operated in a first class manner and consistent with the highest standards of decency and morals prevailing in the community which it serves. In that connection, during the term of this Lease, LANDLORD shall not use or allow any other person or entity to use any portion of the Shopping Center for the conduct of any business or activity of a type which is not generally considered appropriate for regional shopping centers conducted in accordance with good and generally accepted standards of operation or use any portion of the Shopping Center for any unlawful or illegal business use or purpose or for any business use or purpose which is immoral or disreputable including, without limitation, “adult entertainment establishments” and “adult bookstores” or which is conducted in such a manner as to constitute a nuisance of any kind (public or private).

13. Trade Fixtures: All trade fixtures installed by TENANT in the Leased Premises shall remain the property of TENANT. All improvements and fixtures, including trade fixtures installed by TENANT, shall be removed by TENANT at or before the expiration or earlier termination of this Lease at TENANT’S expense. TENANT shall restore the Leased Premises repairing any damage to the Lease Premises caused by the installation or removal of improvements, fixtures and trade fixtures by TENANT.

14. Repairs: LANDLORD shall not be required to keep any portion of the Leased Premises in proper repair. Any work on the structural portions of the Leased Premises required for any reason will be performed at the expense of TENANT. Structural portions shall be defined as bearing walls, beams, roofs and the outside portions of the Leased Premises. TENANT will

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keep inside portions of the Leased Premises in good repair including, but not limited to, all electrical, plumbing, heating, air conditioning (which shall include normal replace of heating and air conditioning filters at least once a year), signs and other mechanical installation in good order, condition and repair at TENANT’S expense and will surrender the Leased Premises at the expiration of the term, in as good condition as when received, excepting ordinary wear and tear and damage by fire or insured casualty. When used in this paragraph, the term “repair” shall include replacements and renewals when necessary to maintain the Leased Premises and any improvements located thereon in good order and condition, except as expressly provided above LANDLORD shall have no obligation to repair, maintain, alter or modify the Leased Premises or any part thereof, or any plumbing, heating, electrical, air conditioning or other mechanical installation therein. Upon the commencement of the term of this Lease, LANDLORD will assign to TENANT any original warranties or guarantees obtained from manufacturers or installers for heating and air conditioning units or facilities within the Leased Premises. TENANT agrees to be solely responsible for and thereafter to repair and to maintain the structural portions of the Leased Premises to or on which TENANT has caused any work to be done or alteration made. TENANT will obtain from reliable companies and keep in force, the typical service contracts of such companies providing for the inspection and servicing of the heating and air conditioning equipment. All repairs, and/or replacements made by TENANT shall be of the same quality, design and class as the original work.

15. Alterations: TENANT will not make any structural alteration to the interior or exterior of the Leased Premises without first obtaining LANDLORD’S written approval of such alteration, which approval shall not be unreasonably withheld, conditioned or delayed.” .

16. Maintenance - No Offensive Practices: From and after the Possession Date, TENANT will keep clean and replace, if necessary, all glass in the doors and windows of the Leased Premises; maintain the Leased Premises in a clean, orderly and sanitary condition; will not permit accumulations of garbage, trash, rubbish and other refuse and will remove the same at TENANT’S expense; will keep all refuse in proper containers on the interior of the Leased Premises until removed; will not use any apparatus for sound reproduction or transmission or any musical instrument in such manner that the sounds so reproduced, transmitted or produced shall be audible beyond the interior of the Leased Premises; will keep all mechanical apparatus free of vibrations and noise which may be transmitted beyond the confines of the Leased Premises; will not cause or permit objectionable odors to emanate or be dispelled from the Leased Premises; will comply with all laws, ordinances, rules and regulations of governmental authorities (including without limitation all fire, electrical and sign codes) and all recommendations of the Association of Fire Underwriters with respect to the use or occupancy of the Leased Premises (including, without limitation, the maintenance of all fire extinguishers); and will conduct TENANT’S Use at the Leased Premises in all respects in a dignified manner and in accordance with high standards of store operation as determined by LANDLORD; will connect a water meter and to pay all water and sewer charges if billed separately.

TENANT shall keep the display windows and signs, if any, in the Leased Premises well lighted, and shall keep the Leased Premises open for business during the regular customer days and hours for similar banking businesses in the trade area in which the Center is located, which

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shall not include Sundays or bank holidays. However, this provision will not preclude TENANT from opening for business on such days, it if so elects.

TENANT shall not store, exhibit, offer to sell or sell any goods, wares or merchandise on or from the Common Areas, or on or from any other place in the Center besides the interior of the Leased Premises, without LANDLORD’S prior consent.

TENANT will not place or maintain on the exterior of the Leased Premises any sign not provided for in Exhibit “C” hereto without first obtaining LANDLORD’S written approval thereof.

17. Control of Common Area: All Common Areas shall at all times be subject to the exclusive control and management of LANDLORD. LANDLORD shall have the right from time to time to establish reasonable rules and regulations with respect to the Common Areas; to police the same; from time to time to change the area, level, location and arrangement to the Common Areas; and to do and perform such other acts in and to the Common Areas as, in the use of good business judgment, LANDLORD shall determine to be advisable with a view to the improvement or the convenience and use thereof by tenants, their officers, agents, employees and customers. TENANT and TENANT’S employees shall park their cars only in those portions of the parking area designated for that purpose by LANDLORD. Employees shall park their cars only in those portions of the parking area designated for that purpose by LANDLORD. TENANT shall furnish LANDLORD, upon request, with automobile license numbers assigned to TENANT’S car or cars, and cars of TENANT’S employees. TENANT further agrees that it, its invitees and licensees, will not use the parking area for the permanent garaging of any vehicle or for overnight parking. TENANT covenants that throughout the term of this Lease, it shall not conduct any activity which increases the use of the parking area or increases the amount of traffic on the parking area beyond the normal use for customers patronizing TENANT for the use of the Leased Premises as set forth in the Basic Lease Provisions, page 1, paragraph (11). LANDLORD hereby reserves the right at any time to make alterations or additions to and to build additional stories on the building in which the Leased Premises are contained and to build adjoining the same so long as it does not materially interfere with TENANT’s use of the Leased Premises. LANDLORD also reserves the right to construct other buildings or improvements in the Center so long as it does not materially interfere with TENANT’s use of the Leased Premises.

18. Roof: Intentionally Omitted.

19. Insurance by TENANT – Indemnification: TENANT, at TENANT’S sole cost and expense, shall obtain and maintain in effect at all times, starting with the Rent Commencement Date and continuing throughout the Term of this Lease and any Option terms, insurance policies providing the following coverages (collectively, “TENANT’S Insurance”):

A. An “all-risk” property insurance policy, including a full replacement cost endorsement, insuring TENANT’S fixtures, equipment and all of the contents in the Leased Premises, including, but not limited to, improvements and betterments, merchandise and inventory, for not less than the fall replacement value of said items. Any and all proceeds of

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such insurance, for as long as this Lease shall remain in effect, shall be used only to repair or replace the items so insured.

B. A policy of plate glass insurance naming LANDLORD and each Mortgagee as additional insureds and loss payees and including a full replacement cost endorsement insuring against all risks, in amounts satisfactory to LANDLORD, covering the full cost of repairing and restoring all of the plate glass in, at or about the Leased Premises. In lieu of the foregoing, TENANT may self-insure against damage to plate and other glass in, at or about the Leased Premises; however, in the event TENANT self-insures, then TENANT shall replace, with glass of like kind and equal quality, at the expense of TENANT, within forty-eight (48) hours after the damages occur, any and all plate and other glass damaged from any cause whatsoever. If TENANT fails to replace any damaged plate or other glass as aforesaid, then (i) such failure shall constitute an “Event of Default” (as hereinafter defined), (ii) LANDLORD shall have the right to replace said plate or other glass at the expense of TENANT without waiving such default, and (iii) without excusing such Event of Default, TENANT shall, without any further request or demand by LANDLORD, obtain and maintain a policy of plate glass insurance as aforesaid during the remainder of the Term of this Lease. In the event of an emergency, LANDLORD shall have the right to replace said plate or other glass within the foregoing forty-eight (48)-hour period as and to the extent the exigencies of the situation require. If LANDLORD replaces any plate or other glass pursuant to this section, then TENANT shall reimburse LANDLORD for all costs associated with the replacement within ten (10) days.

C. A policy or policies of comprehensive public liability insurance, protecting LANDLORD, TENANT and each Mortgagee against any liability for injury, death or property damage occurring upon, in or about any part of the Leased Premises or any appurtenances thereto, with each such policy to afford protection with a combined single limit for bodily injury and property damage of not less than Three Million Dollars ($3,000,000.00) per occurrence. The foregoing minimum limits may, at LANDLORD’S option and upon thirty (30) days’ notice to TENANT, be increased from time to time based on the limits customarily required by institutional shopping center lenders in the area where the Shopping Center is located.

D. Fire and casualty property insurance insuring the Leased Premises at full replacement value including protection from such perils as may be insured against or under a broad form extended coverage endorsement or an all risks of physical loss policy.

E. A policy of rent insurance with respect to damage or destruction caused by fire or other casualty to be covered under the insurance policy referred to herein, and in an amount equal to all Rental payable under this Lease for the twelve (12) months following such damage or destruction. Any and all proceeds of such insurance shall be paid to and held by LANDLORD for application towards the payment of rent hereunder. All insurance policies to be provided herein shall contain an express waiver of any right to subrogation by the insurance company against TENANT, its agents and employees.

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All insurance policies the TENANT is required to procured under this Lease shall

A. be issued by responsible insurance companies licensed to do business in the Commonwealth of Pennsylvania, and shall have such form and content as shall comply with all requirements of the Lease or, absent such requirements, shall be reasonably acceptable to LANDLORD,

B. be, excepted as otherwise provided herein, written as primary coverage and not contributing with, or in excess of, any coverage which LANDLORD may carry,

C. name LANDLORD and each Mortgagee as additional insureds, and

All insurance policies to be provided to TENANT pursuant to the Lease shall (a) contain an express waiver of any right to subrogation by the insurance company against LANDLORD and their respective agents and employees, and (b) name LANDLORD and each Mortgagee as a loss payee. Neither the issuance of any insurance policy required under this Lease nor the minimum limits specified herein shall be deemed to limit or restrict in any way TENANT’S liability arising under or out of this Lease.

At least thirty (30) days before the expiration date of each policy furnished hereunder, TENANT shall deliver to LANDLORD a certificate, or, at LANDLORD’S option, a certified copy or a duplicate original of each and every insurance policy TENANT is required to obtain under this section, or the renewal thereof, as the case may be. Any insurance required to be carried hereunder may be carried under a blanket policy covering the Leased Premises and other locations of TENANT, provided that coverage with respect to the Leased Premises is separately stated and not subject to reduction in connection with any other properties covered by such policy. If TENANT includes the Leased Premises in such blanket coverage, TENANT shall deliver to LANDLORD a certificate, or, at LANDLORD’S option, a duplicate original or certified copy of each such insurance policy or such other evidence that may be satisfactory to LANDLORD and the holder of any first Mortgage on the Shopping Center. Each and every insurance policy required to be carried hereunder by TENANT shall provide that such insurance policy shall not be canceled unless LANDLORD and each Mortgagee shall have received thirty (30) days’ prior written notice of cancellation. In the event that TENANT shall, prior to the thirtieth (30^th) day before any insurance policy will lapse or terminate, or is required to be made effective, fail to furnish the aforementioned evidence of any insurance coverage herein required to be procured by TENANT, then LANDLORD, at its sole option, shall have the right to obtain said coverage and pay the premiums therefore for a period not exceeding one year in each instance, and the premiums so paid by LANDLORD shall be payable by TENANT to LANDLORD, on demand, as Additional Rent.

20. Right of Access: TENANT will permit LANDLORD, its agents, employees and contractors to enter the Leased Premises and all parts thereof to inspect the same, to enforce or carry out any provisions of this Lease binding upon TENANT but not fully and properly performed by TENANT, to perform any defaulted obligation of TENANT or for any other proper purpose, and during the final six (6) months of the Original and Option terms and during the final (9) months of the second Option term to bring prospective tenants and at any time to bring prospective purchasers or appraisers into the Leased Premises for the purposes of

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inspecting the same; provided, however, such entry does not unreasonably interfere with the normal operations of TENANT’S business.

21. Indemnification and Hold Harmless: TENANT shall defend, indemnify and hold LANDLORD and LANDLORD’S agents, officers, directors, employees and contractors, harmless against and from any and all injuries, costs, expenses, liabilities, losses, damages, injunctions, suits, actions, fines, penalties, and demands of any kind or nature (including reasonable attorneys fees) arising in connection with any and all third party claims arising out of (a) injuries occurring within the Leased Premises; (b) any intentional acts or negligence of TENANT or TENANT’s agents, employees or contractors; (c) the breach or default in the performance of any obligations on TENANT’s part to be performed under this Lease, or (d) the failure of any representation or warranty made by TENANT herein to be true when made. This indemnity does not include the intentional or negligent acts or omissions of LANDLORD or its agents, officers, contractors or employees. This indemnity shall survive termination of this Lease.

LANDLORD shall defend, indemnify and hold TENANT and TENANT’s agents, officers, directors, employees and contractors, harmless against and from any and all injuries, costs, expenses, liabilities, losses, damages, injunctions, suits, actions, fines, penalties, and demands of any kind or nature (including reasonable attorneys fees) arising in connection with any and all third party claims arising out of (a) injuries occurring in the common areas or any other portion of the Shopping Center outside the Leased Premises; (b) any intentional acts or negligence of LANDLORD or LANDLORD’S agents, employees or contractors; (c) the breach or default in the performance of any obligations on LANDLORD’S part to be performed under this Lease, or (d) the failure of any representation or warranty made by LANDLORD herein to be true when made. This indemnity does not include the intentional or negligent acts or omissions of TENANT or its agents, officers, contractors or employees. This indemnity shall survive termination of this Lease.

22. Total or Partial Destruction: If the Leased Premises shall be partially or wholly damaged or destroyed by fire or other insured casualty after the commencement of the term of this Lease, TENANT shall use the proceeds of insurance on the Leased Premises for restoration and rebuilding of the Leased Premises. Provided, however, that should such damage or destruction occur within one (1) year of the end of this Lease (or any renewal option), TENANT shall have the option of canceling and terminating this Lease on giving LANDLORD ninety (90) days written notice of TENANT’s intention to do so. If TENANT elects to terminate this Lease in accordance with the foregoing option, TENANT shall be under no duty to restore, rebuild or repair the Leased Premises and the insurance proceeds payable to TENANT, including all loss of rent insurance, as a result of such damage or destruction to the Leased Premises shall be paid to LANDLORD.

TENANT agrees that its fire insurance policies shall include appropriate clauses pursuant to which the insurance carriers:

A. Waive all rights of subrogation against LANDLORD with respect to losses payable under such policies, and/or

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B. Agree that such policies shall not be invalidated should the insured waive, in writing, prior to a loss, any or all right of recovery against any party for losses covered by such policies.

C. TENANT hereby waives any and all right of recovery which it might otherwise have against LANDLORD, its agents, employees, licensees, visitors or invitees, for loss or damage to TENANT’S contents, furniture, furnishings, fixtures and other property removable by TENANT under the provisions of this Lease notwithstanding that such loss or damage may result from the negligence or fault of LANDLORD, its agents or employees, so long as such loss or damage does not result from LANDLORD’S gross negligence or willful misconduct. TENANT agrees to advise LANDLORD promptly as to the language of the clauses included in its insurance policies pursuant to this paragraph. TENANT also agrees to notify LANDLORD prior to any change of the terms of any such policy which would affect such clauses.

23. Eminent Domain: If the Leased Premises shall be taken under the power of eminent domain, then this Lease shall terminate on the day when TENANT is required to yield possession thereof. If the amount of the Leased Premises so taken is such as to impair substantially the usefulness of the Leased Premises for the purpose for which the same are hereby leased, then TENANT shall have the option to terminate this Lease as of the date when TENANT is required to yield possession by delivering written notice to LANDLORD within sixty (60) days after the date TENANT is deprived of possession.

All compensation awarded for such taking of the fee and the leasehold shall belong to and be the property of the LANDLORD. TENANT releases in favor of and assigns to LANDLORD all claims in such connection and agrees with LANDLORD that TENANT shall make no claims therefore against LANDLORD, the condemner or any other party, provided, however, that LANDLORD shall not be entitled to any portion of any award made to TENANT for the cost of removal of TENANT’S stock, the unamortized value of TENANT’s leasehold improvements and TENANT’S removable trade fixtures.

24. Assignment and Subletting:

A. TENANT may not assign this Lease in whole or in part, or sublet all or any part of the Leased Premises, without the prior written consent of LANDLORD. The LANDLORD shall not unreasonably withhold such consent. Consent by LANDLORD to any assignment or subletting shall not constitute a waiver of the necessity for such consent to any subsequent assignment or subletting. Notwithstanding any assignment or subletting made with LANDLORD’S consent, TENANT shall remain fully liable to LANDLORD under this Lease and, if required, TENANT shall provide LANDLORD with a written agreement of any approved assignee or subtenant whereby the approved assignee or subtenant undertakes liability to LANDLORD (along with TENANT) for payment and performance without any limitations as required of TENANT under this Lease.

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B. Rent Recapture. Subject to the provisions of the above paragraph, should LANDLORD approve any assignment or subletting of the premises, TENANT, subtenant, assignee or other occupant, shall promptly and directly pay LANDLORD the full amount of all rent, income or other money collected from any subtenant or assignee that is in excess of the fixed minimum rent then in effect. Such payment of any excess rent shall not relieve TENANT of the obligation to pay the fixed minimum rent then in effect.

25. Custom and Usage: LANDLORD and TENANT shall each have the right at all times to enforce the covenants and conditions of this Lease in strict accordance with the terms hereof, notwithstanding any conduct or custom on its part in refraining from so doing. The failure of LANDLORD or TENANT at any time or times to enforce its rights under said covenants and provisions strictly in accordance with the same shall not be construed as having created a custom in any way or manner contrary to the specific terms, provisions and covenants of this Lease or as having in any way or manner modified the same.

26. Performance of TENANT’S Covenants: If TENANT fails to perform any of the agreements and covenants expressed in this Lease as to be performed by TENANT, then LANDLORD may, at its option, enter upon the Leased Premises and perform such agreement or covenant on TENANT’S behalf, and LANDLORD shall have no liability to TENANT for any loss or damage resulting in any way from such action by LANDLORD and TENANT agrees promptly to pay upon demand as Additional Rent any expense incurred by LANDLORD in taking such action with interest thereon at The Wall Street Journal Prime Rate, if not so paid on demand. In the event TENANT defaults in the payment of Rent as described in Section 27(A) three or more times in any twelve (12) month period, the interest rate described herein shall be increased to ten (10%) percent or the Wall Street Journal Prime Rate, whichever is higher.

27. Events of Default: This Lease is made upon the condition that TENANT shall punctually and faithfully perform all of the covenants, conditions and agreements by it to be performed as is set forth in this Lease. The following shall each be deemed to be an event of default (each of which is sometimes referred to as an “Event of Default” in this Lease):

A. The failure by TENANT to pay the Rent, including but not limited to Minimum Rent, Additional Rent or any late charges or fees, or any installment thereof when due or within ten (10) days of the due date;

B. The filing of a Mechanics’ Lien as the result of TENANT’S work not paid for contrary to the provisions of this Lease;

C. After the completion of TENANT’S Work, the failure of TENANT to remain continuously open for business in the Leased Premises during regular business hours for one hundred twenty (120) consecutive days, or if TENANT vacates or abandons the Leased Premises;

D. The failure of TENANT to observe or perform any of the covenants, terms or conditions set forth in respect to assignment and subletting when such failure continues for a period of fifteen (15) days;

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E. The failure of TENANT to observe or perform any of the other covenants, terms or conditions set forth in this Lease where said failure continues for a period of fifteen (15) days after written or oral notice thereof from LANDLORD to TENANT (unless such failure cannot reasonably be cured within fifteen (15) days and TENANT shall have commenced to cure said failure within fifteen (15) days and continued diligently to pursue the curing of the same until completed);

F. The commencement of levy, execution, or attachment proceedings against TENANT or a substantial portion of TENANT’S assets; the commencement of levy, execution, attachment or other process of law upon, on, or against the estate created in TENANT hereby; the application for or the appointment of a liquidator, receiver, custodian, sequester, conservator, trustee, or other similar judicial officer (and such appointment continues for a period of sixty (60) days); the insolvency of TENANT in the bankruptcy or equity sense; or any assignment by TENANT for the benefit of creditors.

G. The commencement of a case by or against TENANT or any guarantor, under any insolvency, bankruptcy, creditor adjustment or debtor rehabilitation laws, state or federal. The determination by the TENANT to request relief under any insolvency proceeding, including any insolvency, bankruptcy, creditor adjustment or debtor rehabilitation laws, state or federal, terminates the estate created in TENANT hereby and the Leased Premises shall not become an asset in any such proceedings;

H. Repetition or continuation of any failure to pay any Rent or other sums reserved hereunder when due as provided herein where such failure shall be repeated on three (3) occasions in any twelve (12) month period;

I. The failure of TENANT to pay when due all taxes, assessments and government charges imposed upon it or which it is required to withhold and pay over within ten (10) days of receiving notices that any such amounts have been imposed and are overdue;

J. The sale or removal of a substantial portion of TENANT’S property located in the Leased Premises in a manner which is outside the ordinary course of TENANT’S business.

28. LANDLORD’S Remedies:

A. LANDLORD may treat any Event of Default as a breach of this lease. LANDLORD’S failure to insist upon strict performance of any covenant, term or condition of this Lease or to exercise any rights or remedies it has reserved herein shall not be deemed a waiver or relinquishment for the future of such performance, right or remedy. In addition to any and all other rights and remedies of LANDLORD in this Lease or as provided by law or equity, LANDLORD shall have the following rights and remedies if there shall occur any Event of Default:

(1) To terminate the Lease, and without further notice, to re-enter the Leased Premises and take possession thereof and to remove all persons therefrom, and TENANT shall have no further claims or rights hereunder;

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(2) To bring suit for the collection of Rent and for damages (including without limitation, reasonable attorneys’ fees and the cost of repairing and re-letting the Leased Premises) without entering into possession of the Leased Premises or canceling this Lease. Commencement of any action by LANDLORD for rent and damages shall not be construed as an election to terminate this Lease and shall not absolve or discharge TENANT from any of its obligations or liabilities for the remainder of the Term;

(3) To retake possession of the Leased Premises from TENANT by summary proceedings or otherwise. To the extent permitted by law, TENANT waives notice of re-entry or repossession. Commencement of any action by LANDLORD for re-entry shall not be construed as an election to terminate this Lease and shall not absolve or discharge TENANT from any of its obligations or liabilities for the remainder of the Term. If, in the event of any ouster, LANDLORD re-lets the Leased Premises, TENANT shall continue to be liable for the payment of any deficiencies in Rent after such re-let. LANDLORD shall make a good faith effort to re-let the Leased Premises at market rates after ousting TENANT. In the event of any re-entry, LANDLORD shall have the right but not the obligation to remove any personal property from the Leased Premises and place the same in storage at a public warehouse at the expense and risk of the TENANT;

(4) To enter the Leased Premises and, without further demand or notice, proceed to distress and sale of the goods, chattels, and personal property there found and to levy the Rent, and TENANT shall pay all costs and officers’ commissions, including watchmen’s wages and sums chargeable to LANDLORD, and further including the five (5%) percent chargeable by the Act of Assembly as commissions to the constable or other person making the levy, and in such cases all costs, officers’ commissions and other charges shall immediately attach and become part of the claim of LANDLORD for Rent, and any tender of Rent without said costs, commissions and charges made after the issuance of a warrant of distress, shall not be sufficient to satisfy the claim of LANDLORD.

In the event of a breach or threatened breach by TENANT of any of the covenants or provisions hereof, LANDLORD shall have the right of injunction and the right to invoke any remedy allowed at law or in equity as if re-entry, summary proceedings and other remedies were not herein provided for. Mention in this Lease of any particular remedy shall not preclude LANDLORD from any other remedies under this Lease, now or hereafter existing at law or in equity or by statute.

B. IF TENANT SHALL DEFAULT IN THE PAYMENT OF THE RENT OR ANY OTHER SUMS DUE HEREUNDER BY TENANT, OR IN THE EVENT OF A DELIBERATE EVENT OF DEFAULT AS DEFINED HEREIN, TENANT HEREBY IRREVOCABLY AUTHORIZES AND EMPOWERS ANY PROTHONOTARY OR ATTORNEY OF ANY COURT OF RECORD WITHIN THE UNITED STATES OF AMERICA, OR ELSEWHERE, TO APPEAR FOR TENANT, WITH OR WITHOUT

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COMPLAINT FILED; AND IN SAID SUITS OR ACTIONS TO CONFESS JUDGMENT, OR A SERIES OF JUDGMENTS, AGAINST TENANT AND ALL PERSONS CLAIMING THROUGH OR UNDER TENANT, IN FAVOR OF LANDLORD, FOR ALL OR ANY PART OF SAID RENTAL AND/OR SAID OTHER SUMS, INCLUDING, BUT NOT LIMITED TO, THE AMOUNTS DUE FROM TENANT TO LANDLORD UNDER SUBSECTION (a) or SUBSECTION (b) OF THIS SECTION, AND INCLUDING ANY AMOUNT TO WHICH LANDLORD WOULD BE ENTITLED AS DAMAGES UNDER THE PROVISIONS OF THIS LEASE, INCLUDING, BUT NOT LIMITED TO, ARTICLE 19, AND FOR INTEREST AND COSTS, AND A REASONABLE ATTORNEY’S COMMISSION NOT TO EXCEED FIVE (5%) PERCENT OF THE TOTAL AMOUNT OF SUCH RENTAL AND/OR SAID OTHER SUMS FOR COLLECTION, FOR WHICH THIS LEASE, OR A TRUE AND CORRECT COPY THEREOF, SHALL BE SUFFICIENT WARRANT, AND SUCH POWERS MAY BE EXERCISED AS WELL AFTER THE TERMINATION OR EXPIRATION OF THE TERM OF THIS LEASE. THE WARRANT OF ATTORNEY HEREIN GRANTED SHALL NOT BE EXHAUSTED BY ONE (1) OR MORE EXERCISES THEREOF, BUT SUCCESSIVE ACTIONS MAY BE COMMENCED AND SUCCESSIVE JUDGMENTS MAY BE CONFESSED OR OTHERWISE ENTERED AGAINST TENANT FROM TIME TO TIME AS OFTEN AS ANY OF THE RENT AND/OR OTHER AMOUNTS AND SUMS SHALL FALL OR BE DUE OR BE IN ARREARS, AND THIS WARRANT OF ATTORNEY MAY BE EXERCISED AFTER THE TERMINATION OR EXPIRATION OF THE TERM AND/OR DURING OR AFTER ANY EXTENTIONS OF THE TERMS OR RENEWALS OF THIS LEASE. TENANT HEREBY ACKNOWLEDGES THAT BY AGREEING TO THE FOREGOING CONFESSION OF JUDGMENT AND WARRANT OF ATTORNEY, TENANT WAIVES THE RIGHT TO NOTICE AND A PRIOR JUDICIAL PROCEEDING TO DETERMINE ITS RIGHTS AND LIABILITIES, AND FURTHER ACKNOWLEDGES THAT LANDLORD MAY, ON DEFAULT BY TENANT UNDER THE LEASE, SUBJECT TO SUCH NOTICE REQUIREMENTS, IF ANY, AS ARE HEREIN EXPRESSLY PROVIDED, OBTAIN A JUDGMENT AGAINST TENANT FOR ALL SUMS DUE HEREUNDER, AND LEVY EXECUTION ON SUCH JUDGMENT AGAINST ANY AND ALL PROPERTY OF TENANT WITHOUT ANY OPPORTUNITY OF TENANT TO RAISE ANY DEFENSE, SETOFF, COUNTERCLAIM OR OTHER CLAIM THAT TENANT MAY HAVE, AND THAT TENANT KNOWINGLY, VOLUNTARILY AND INTELLIGENTLY GRANTS LANDLORD THE FOREGOING RIGHT TO CONFESS JUDGMENT AND WARRANT OF ATTORNEY AS AN EXPLICIT AND MATERIAL PART OF THE CONSIDERATION BARGAINED FOR BETWEEN TENANT AND LANDLORD. TENANT CERTIFIES THAT IT HAS BEEN REPRESENTED BY (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) AT THE SIGNING OF THIS LEASE AND IN THE GRANTING OF THIS CONFESSION OF JUDGMENT AND WARRANT OF ATTORNEY BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THE CONFESSION OF JUDGMENT AND WARRANT OF ATTORNEY WITH COUNSEL. TENANT FURTHER CERTIFIES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND EFFECT OF THE FOREGOING CONFESSION OF JUDGMENT AND WARRANT OF ATTORNEY. TENANT FURTHER ACKNOWLEDGES THAT THIS LEASE IS A COMMERCIAL TRANSACTION, AND THAT THE RELATIONSHIP BETWEEN LANDLORD AND TENANT CREATED HEREUNDER IS COMMERCIAL IN NATURE.

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D. IN ANY ACTION FOR RENT OR OTHER SUMS, IF LANDLORD SHALL FIRST CAUSE TO BE FILED IN SUCH ACTION AN AFFIDAVIT MADE BY IT OR SOMEONE ACTING FOR IT SETTING FORTH THE FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, SUCH AFFIDAVIT SHALL BE CONCLUSIVE EVIDENCE OF SUCH FACTS; AND IF A TRUE COPY OF THIS LEASE (AND OF THE TRUTH OF THE COPY SUCH AFFIDAVIT SHALL BE SUFFICIENT EVIDENCE) BE FILED IN SUCH ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR PRACTICE TO THE CONTRARY NOTWITHSTANDING. TENANT HEREBY WAIVES AND RELEASES TO LANDLORD, AND TO ANY AND ALL ATTORNEYS WHO MAY APPEAR FOR LANDLORD, ALL PROCEDURAL ERRORS IN ANY PROCEEDINGS TAKEN BY LANDLORD, WHETHER BY VIRTUE OF THE WARRANTS OF ATTORNEY CONTAINED IN THIS LEASE OR NOT, STAY OF EXECUTION AND EXTENSION OF TIME OF PAYMENT, ALL LAWS EXEMPTING REAL OR PERSONAL PROPERTY FROM EXECUTION AND ALL LIABILITY THEREFOR, AND NO BENEFIT OF EXEMPTION WILL BE CLAIMED UNDER AND BY VIRTUE OF ANY EXEMPTION LAW NOW IN FORCE OR WHICH MAY HEREAFTER BE PASSED.

E. TENANT expressly waives:

(1) The benefit of all laws, now or hereinafter in force, exemption of any goods in the Leased Premises on elsewhere from distraint, levy or sale in any legal proceedings taken by LANDLORD to enforce any right under this Lease.

(2) The benefit of all laws now made or which may hereafter be made regarding any limitation as to the goods upon which, or the time within which, distress is to be made after the removal of goods, and TENANT further relieves LANDLORD of the obligation of providing or identifying such goods; it being the purpose and intent of this provision that all goods of TENANT, whether upon the Leased Premises or not, shall be liable to distress for rent.

29. Accord and Satisfaction: No payment by TENANT or receipt by LANDLORD of a lesser amount than the Monthly or Additional Rent herein stipulated shall be deemed to be other than on account of the earliest stipulated Monthly or Additional Rent, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as Monthly or Additional Rent be deemed an accord and satisfaction, and LANDLORD may accept such check or payment without prejudice to LANDLORD’S right to recover the balances of such Monthly or Additional Rent or pursue any other remedy provided in this Lease.

30. Subordination of Lease: TENANT’S rights under this Lease are and shall remain subject and subordinate to the operation and effect of

(a) any lease of land only or of land and buildings in a sale-leaseback transaction involving the Premises, or

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(b) any mortgage, deed of trust or other security instrument constituting a mortgage lien upon the Premises, whether the same shall be in existence at the date hereof or created hereafter, any such lease, mortgage, deed of trust or other security instrument being referred to herein as a “Mortgage” and the party or parties having the benefit of the same, whether as lessor, mortgagee, trustee, beneficiary or noteholder, being referred to herein as a “Mortgagee”. TENANT’S acknowledgment and agreement of subordination provided for in this Section is self-operative and no further instrument of subordination shall be required; however, TENANT shall execute such further assurances thereof as shall be requested or as may be requested from time to time by LANDLORD or a Mortgagee. If a Mortgagee shall so elect by notice to TENANT or by the recording of a unilateral declaration of subordination, this Lease and TENANT’S rights hereunder shall be superior and prior in right to the Mortgage of which such Mortgagee has the benefit, with the same force and effect as if this Lease had been executed, delivered and recorded prior to the execution, delivery and recording of such Mortgage, subject, nevertheless, to such conditions as may be set forth in any such notice of declaration.

TENANT agrees to subordinate its rights under this Lease to any lease wherein LANDLORD is the lessee and to the lien of any or all mortgages or deeds of trust, regardless of whether such lease, mortgage or deeds of trust now exist or may hereinafter be created with regard to all or any part of the Shopping Center, and to any and all advances to be made thereunder, and to the interest thereon, and all modifications, consolidations, renewals, replacements and extensions thereof, termination of the Lease or foreclosure under the mortgage or deeds of trust, to recognize this Lease, if TENANT is not in default. Such subordination shall be effective without the execution of any further instrument. TENANT also agrees that any lessor, mortgagee or trustee may elect to have this Lease prior to any lease or lien of its mortgage or deed of trust, and in the event of such election and upon notification by such lessor, mortgagee or trustee to TENANT to that effect, this Lease shall be deemed prior in lien to the said lease, mortgage or deed of trust, whether this Lease is dated prior to or subsequent to the date of said lease, mortgage or deed of trust.

The LANDLORD will arrange with any current or future Mortgagee, on the Mortgagee’s standard form, a Subordination, Non-Disturbance and Attornment Agreement (the “SNDA”), which shall acknowledge TENANT’s rights under the insurance and condemnation sections of this Lease and which also provides, among other items, that if by disposition, foreclosure or otherwise, such holder or any successor-in-interest shall come into possession of the Leased Premises or shall become the owner of the Leased Premises, or take over the right of the LANDLORD in the Leased Premises, such mortgage holder will not disturb the possession, use or enjoyment of the Leased Premises by the TENANT nor disaffirm this Lease or the TENANT’s rights or estate hereunder so long as all of the obligations of TENANT are fully performed in accordance with the terms of this Lease.

31. TENANT’S Attornment: TENANT shall, in the event of the sale or assignment of LANDLORD’S interest in the Leased Premises, or in the event of any proceedings brought for the foreclosure of, or in the event of the exercise of the power of sale under any mortgage or deed of trust covering the Leased Premises, or in the event of the termination of any lease in a

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sale-leaseback transaction wherein LANDLORD is the lessee, attorn to and recognize such purchaser or assignee or mortgagee as LANDLORD under this Lease.

TENANT agrees that, upon the request of LANDLORD, or any such lessor, mortgagee or trustee, TENANT shall execute and deliver whatever instruments may be required for such purposes and to carry out the intent of this paragraph, and in the event TENANT fails to do so within fifteen (15) days after demand in writing, TENANT does hereby make, constitute and irrevocably appoint LANDLORD as its attorney-in-fact, coupled with an interest, in its name, place and stead to sign and deliver such instruments as if the same had been signed and delivered by TENANT.

32. Lease Subject to Financing Requirement: If any lending institution with which LANDLORD has negotiated or may negotiate construction, interim or long-term financing for the Shopping Center does not approve the financial and credit rating of TENANT for purposes of such financing, or if any such lending institution shall require a change or changes in this Lease as a condition of its approval of this Lease for such financing, and if within fifteen (15) days after notice from LANDLORD (a) TENANT fails or refuses to supply or execute assurances and/or guarantees which are stated by LANDLORD as necessary to secure the approval of TENANT’S financial and credit rating by any such lending institution; or (b) if TENANT fails or refuses to execute with LANDLORD the amendment or amendments to this Lease accomplishing the change or changes which are stated by LANDLORD to be needed in connection with approval of this Lease for purposes of such financing, LANDLORD shall have the right to cancel this Lease at any time prior to the commencement of TENANT’S Work as defined herein in Exhibit “B”. In the event of cancellation by LANDLORD hereunder, this Lease shall be and become null and void with no further liability or obligation on the part of either party hereto.

33. Entire Agreement: This Lease, including the Exhibits hereto and any addenda hereto, sets forth all of the covenants, promises, agreements, conditions and understandings between LANDLORD and TENANT concerning the Leased Premises and the Shopping Center. No alteration, amendment, change or addition to this Lease shall be binding upon LANDLORD or TENANT unless reduced to writing, signed by them and mutually delivered between them.

34. TENANT Will Quit: TENANT agrees to quit and remove from the Leased Premises at the end of the term or sooner termination of this Lease, without notice and that TENANT will thereupon without delay deliver to LANDLORD all keys TENANT may have for the Leased Premises.

35. Bankruptcy and Insolvency:

A. In the event TENANT shall become a debtor under Chapter 7 of the Bankruptcy Code as it may be amended or to any other successor statute thereto, and the Trustee or Tenant shall elect to assume this Lease for the purpose of assigning the same or otherwise, such election and assignment may only be made if all of the terms and conditions of hereof are satisfied. If such Trustee shall fail to elect or assume this Lease within sixty (60) days after the filing of the Petition, this Lease shall be deemed to have been reflected. LANDLORD shall be

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thereupon immediately entitled to possession of the demised premises without further obligation to TENANT or Trustee, and this Lease shall be canceled, but LANDLORD’S right to be compensated for damages in such liquidation proceedings shall survive.

B. In the event a Petition for reorganization or adjustment of debts is filed concerning Tenant under Chapters 11 or 13 of the Bankruptcy Code, or a proceeding is filed under Chapter 7 of the Bankruptcy Code and is transferred to Chapters 11 or 13, the Trustee or Tenant, as Debtor-In-Possession, must elect to assume this Lease within seventy-five (75) days from the date of the filing of the Petition under Chapters 11 or 13, or the Trustee or Debtor-In-Possession shall be deemed to have rejected this Lease. No election by the Trustee or Debtor-In-Possession to assume this Lease, whether under Chapters 7, 11 or 13, shall be effective unless each of the following conditions, which LANDLORD and TENANT acknowledge are commercially reasonable in the context of a bankruptcy proceeding of TENANT, have been satisfied, and LANDLORD has so acknowledged in writing:

(1) The Trustee or the Debtor-In-Possession has cured, or has provided LANDLORD adequate assurance (as defined below) that:

(i) Within ten (10) days from the date of such assumption the Trustee will cure all monetary defaults under this Lease; and

(ii) Within thirty (30) days from the date of such assumption the Trustee will cure all non-monetary defaults under this Lease.

(2) The Trustee or the Debtor-In-Possession has compensated, or has provided to LANDLORD adequate assurance (as defined below) that within ten (10) days from the date of assumption LANDLORD will be compensated for any pecuniary loss incurred by LANDLORD arising from the default of TENANT, the trustee, or the Debtor-In- Possession as recited in LANDLORD’S written statement of pecuniary loss sent to the Trustee or Debtor-In-Possession.

(3) The Trustee or the Debtor-In-Possession has provided LANDLORD with adequate assurance of the future performance of each of TENANT’S, Trustee’s or Debtor-In- Possession’s obligations under this lease; provided, however, that:

(i) The Trustee or Debtor-In-Possession shall also deposit with LANDLORD, as security for the timely payment of rent, an amount equal to three (3) months rent (as adjusted pursuant to Section 35.B(3)(iii)below) and other monetary charges accruing under this Lease; and

(ii) If not otherwise required by the terms of the Lease, the Trustee or Debtor-In- Possession shall also pay in advance on the date minimum rent is payable 1/12th of TENANT’S annual obligations under this Lease for maintenance, common area charges, real estate taxes, merchants’ association dues, insurance and similar charges.

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(iii) From and after the date of the assumption of this Lease, the Trustee or Debtor-In-Possession shall pay as minimum rent an amount equal to the minimum rental otherwise payable hereunder, which amount shall be payable in advance in equal monthly installments on the date minimum rent is payable.

(iv) The obligations imposed upon the Trustee or Debtor-In-Possession shall continue with respect to Tenant or any assignee of the Lease after the completion of bankruptcy proceedings.

(4) The assumption of this Lease will not:

(i) Breach any provision in any other lease, mortgage, financing agreement or other agreement by which LANDLORD is bound relating to the Shopping Center; or

(ii) Disrupt, in LANDLORD’S reasonable judgment, the tenant mix of the Shopping Center or any other attempt by LANDLORD to provide a specific variety of retail stores in the Shopping Center which, in LANDLORD’S judgment, would be most beneficial to all of the tenants of the Shopping Center and would enhance the image, reputation and profitability of the Shopping Center.

C. For purposes of this Section, LANDLORD and TENANT acknowledge that in the context of a bankruptcy proceeding of TENANT, at a minimum “adequate assurance” shall mean:

(1) The Trustee or Debtor-In-Possession has and will continue to have sufficient unencumbered assets after the payment of all secured obligations and administrative expenses to assure LANDLORD that the Trustee or Debtor-In-Possession will have sufficient funds to fulfill the obligations of TENANT under this Lease, and to keep the demised premises stocked with merchandise and properly staffed with sufficient employees to conduct a fully operational, actively promoted business on the demised premises; and

(2) The Bankruptcy Court shall have entered an Order segregating sufficient cash payable to LANDLORD and/or the Trustee or Debtor-In-Possession shall have granted a valid and perfected first lien and security interest and/or mortgage in property of TENANT, Trustee or Debtor-In-Possession, acceptable as to value and kind to LANDLORD, to secure to LANDLORD with obligation of the Trustee or Debtor-In-Possession to cure the monetary and/or non-monetary defaults under this Lease within the time periods set forth above.

(3) In the event that this Lease is assumed by a Trustee appointed for TENANT or by TENANT as Debtor-In-Possession under the provisions of Section (2) hereof and thereafter TENANT is liquidated or files a subsequent Petition for reorganization or adjustment of debts under Chapters 11 or 13 of the Bankruptcy Code, then, and in either of such events, LANDLORD may, at its option, terminate this Lease and all rights of TENANT hereunder, by giving TENANT written notice of its election to so terminate, by no later than thirty (30) days after the occurrence of either of such events.

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(4) If the Trustee or Debtor-In-Possession has assumed the Lease pursuant to the terms and provisions of Sections (1) or (2) herein, for the purposes of assigning (or elects to assign) TENANT’S interest under this Lease or the estate created thereby, to any other person, such interest or estate may be so assigned only if LANDLORD shall acknowledge in writing that the intended assignee has provided adequate assurance as defined in this Section (4) of future performance of all of the terms, covenants and conditions of this Lease to be performed by TENANT.

For purposes of this Section (4), LANDLORD and TENANT acknowledge that, in the context of a Bankruptcy proceeding of TENANT, at a minimum “adequate assurance of future performance” shall mean that each of the following conditions have been satisfied, and LANDLORD has so acknowledged in writing:

(i) The assignee has submitted a current financial statement audited by a certified public accountant which shows a net worth and working capital in amounts determined to be sufficient by LANDLORD to assure the future performance by such assignee of TENANT’S obligations under this Lease;

(ii) The assignee, if requested by LANDLORD, shall have obtained guarantees in form and substance satisfactory to LANDLORD from one (1) or more persons who satisfy LANDLORD’S standards of creditworthiness;

(iii) The assignee has submitted in writing evidence, satisfactory to LANDLORD, of substantial retailing experience in shopping centers of comparable size to the Shopping Center and in the sale of merchandise and services permitted under this Lease; and

(iv) LANDLORD has obtained all consents or waivers from any third party required under any lease, mortgage, financing arrangement or other agreement by which LANDLORD is bound to permit LANDLORD to consent to such assignment.

(5) When, pursuant to the Bankruptcy Code, the Trustee or Debtor-In-Possession shall be obligated to pay reasonable use and occupancy charges for the use of the demised premises or any portion thereof, such charges shall not be less than the minimum rent as defined in this Lease and other monetary obligations of TENANT for the payment of maintenance, common area charges, real estate taxes, merchants association dues, insurance and similar charges.

(6) Neither TENANT’S interest in the Lease, nor any lesser interest of TENANT herein, nor any estate of TENANT hereby created, shall pass to any trustee, receiver, assignee for the benefit of creditors, or any other person or entity, or otherwise by operation of law under the laws of any state having jurisdiction of the person or property of TENANT (hereinafter referred to as the “state law”) unless LANDLORD shall consent to such transfer in writing. No acceptance by LANDLORD of rent or any other payments from any such trustee,

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receiver, assignee, person or other entity shall be deemed to have waived, nor shall it waive the need to obtain LANDLORD’S consent of LANDLORD’S right to terminate this Lease for any transfer of TENANT’S interest under this Lease without such consent.

(7) In the event the estate of TENANT created hereby shall be taken in execution or by other process of law, or if TENANT or any guarantor of TENANT’S obligations hereunder (hereinafter referred to as the “Guarantor”) shall be adjudicated insolvent pursuant to the provisions of any present or future insolvency law under state law, or if any proceedings are filed by or against the guarantor under the Bankruptcy Code, or any similar provisions of any future federal bankruptcy law, or if a Receiver or Trustee of the property of TENANT or guarantor shall be appointed under state law by reason of TENANT’S or guarantor’s insolvency or if any assignment shall be made of TENANT’S or the law; then and in such event LANDLORD may, at its option, terminate this Lease and all rights of TENANT hereunder by giving TENANT written notice of the election to so terminate within thirty (30) days after the occurrence of such event.

36. Mechanic Liens:

A. TENANT will not permit to be created or to remain undischarged any lien, encumbrance or charge (arising out of any work done or materials or supplies furnished by any contractor, subcontractor, mechanic, laborer or materialman or any mortgage, conditional sale, security agreement or chattel mortgage, or otherwise by or for TENANT) which might be or become a lien or encumbrance or charge upon the Shopping Center or any portion thereof or the income therefrom. TENANT will not suffer any other matter or thing whereby the estate, rights and interests of LANDLORD in the Shopping Center or any portion thereof might be impaired. If any lien or notice of lien on account of any alleged debt of TENANT or any notice of contract by a party engaged by TENANT or TENANT’S contractor to work on the Premises shall be filed against the Shopping Center or any portion thereof, TENANT shall within ten (10) days after demand from LANDLORD, cause the same to be discharged of record by payment, deposit, bond, order of a court of competent jurisdiction or otherwise. If TENANT shall fail to cause such lien or notice of lien to be discharged within the period aforesaid, then, in addition to any other right or remedy it may have, LANDLORD may, but shall not be obligated to, discharge such lien by deposit or by bonding proceedings, and in any such event LANDLORD shall be entitled, if LANDLORD so elects, to compel the prosecution of an action for the foreclosure of such lien by the interest, costs and allowances. Any amount so paid by LANDLORD and all costs and expenses, including attorneys’ fees, incurred by LANDLORD and all costs therewith, shall constitute Additional Rent payable by TENANT under this Lease and shall be paid by TENANT to LANDLORD on demand. Nothing herein contained shall obligate TENANT to pay or discharge any lien created by LANDLORD.

B. TENANT shall pay promptly all persons furnishing labor or materials with respect to any work performed by TENANT or TENANT’S contractor in the Premises. No work which LANDLORD permits TENANT to do shall be deemed to be for the immediate use and benefit of LANDLORD so that no mechanic’s or other lien shall be allowed against the estate of LANDLORD by reason of any consent given by LANDLORD to TENANT to improve the Premises.

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C. Prior to commencement of any work or the delivery of any material in the Premises by any contractor, subcontractor or materialman (herein collectively called “Contractor”), TENANT shall deliver to LANDLORD a recordable waiver of lien affidavit (herein called “Contractor’s Waiver of Lien”) from TENANT’S General Contractor in the form attached hereto as Exhibit “E”. Contractor’s Waiver of Lien provides, among other things, that the Contractor waives any and all lien rights that it may have against LANDLORD’S interest in the Shopping Center or any portion thereof.

37. Miscellaneous:

A. Holding Over: Any holding over by TENANT after the expiration of the term hereof, with consent of LANDLORD, shall be construed to be a tenant from month to month only, at the rents and on the other terms and conditions herein provided to the extent applicable.

B. Waiver of Jury Trial: Both LANDLORD and TENANT agree hereby to waive and do hereby waive trial by jury in any action, proceedings or counter-claim brought by either or the parties hereto under or in connection with this Lease.

C. Waiver of Right of Redemption: TENANT hereby expressly waives any and all rights of redemption granted by or under any present or future law in the event TENANT is evicted by the Order of any Court pursuant to any dispossessory warrant or proceedings in any court.

D. Quiet Enjoyment: Upon payment by TENANT of the rents and other sums herein reserved and provided to be paid by TENANT and upon the observance and performance by TENANT of all of the covenants, agreements, terms and conditions of this Lease on TENANT’S part to be observed and performed, TENANT shall peaceably and quietly hold and enjoy the Lease Premises for the term hereby demised without hindrance or interruption by LANDLORD or by any persons lawfully claiming or holding by, through or under LANDLORD, subject nevertheless, to the terms, provisions and conditions of this Lease.

38. Recording: LANDLORD and TENANT agree that TENANT may, at its sole cost and expense, prepare and record an appropriate Memorandum of this Lease.

39. Notice of LANDLORD Default: No default on the part of LANDLORD hereunder shall be deemed to have occurred until LANDLORD shall have been given thirty (30) days written notice by TENANT.

40. Succession: Subject to the limitations against assignment and subleasing hereinbefore set out, all rights and liabilities herein given to, or imposed upon, the respective parties hereto shall extend to and bind the several and respective heirs, executors, administrators, successors and assigns of the said parties; and if there shall be more than one tenant, they shall all be bound jointly and severally by the terms, covenants and agreements herein and the word “Tenant” shall be deemed and taken to mean each and every person or party mentioned as a

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tenant herein; and if there shall be more than one tenant any notice required or permitted by the terms of this Lease may be given by or to any one thereof, and shall have the same force and effect as if given by or to all thereof.

41. Limited Liability: Neither LANDLORD nor any partner of LANDLORD shall be under any personal liability with respect to any of the provisions of this Lease, and if LANDLORD is in breach or default under this Lease, TENANT shall look solely to the equity of LANDLORD in the Leased Premises and the Shopping Center for the satisfaction of TENANT’S remedies. LANDLORD’S liabilities under the terms, covenants, conditions, warranties and obligations of this Lease shall in no event exceed the loss of LANDLORD’S equity interest in the Center.

42. Brokers: TENANT represents and warrants to LANDLORD that TENANT has had no dealings, negotiations or consultations with respect to the Leased Premises or this transaction with any broker or other intermediary other than Equity Properties, Inc. and that no other broker or intermediary called the Leased Premises to TENANT’S attention for lease or to any part in any dealings, negotiations or consultations with respect to the Leased Premises or this Lease. TENANT shall indemnify and hold LANDLORD harmless for any damage or liability of LANDLORD caused by any breach of this representation and warranty.

43. Notices:

A. Any notice by TENANT to LANDLORD must be served by certified mail, postage prepaid, addressed to LANDLORD at LANDLORD’S original address, or at such other address as LANDLORD shall designate to TENANT by written notice, which change of address by LANDLORD shall not be effective unless received by TENANT.

B. Any notice by LANDLORD to TENANT must be served by certified mail, postage prepaid, addressed to TENANT at the Leased Premises.

44. Severability: Each of the sections of this Lease is separate and severable, and if any section is found to be unenforceable or void, either by statute or decision of a Court, the remaining sections shall nevertheless be valid and enforceable.

45. Corporate Tenants: TENANT shall provide LANDLORD with an appropriate corporate resolution whereby it covenants and warrants that: The TENANT is a duly constituted corporation qualified to do business in the state in which the Shopping Center is located; all TENANT’S franchise and corporate taxes have been paid to date; all future forms, reports, fees and other documents necessary for TENANT to comply with applicable laws will be filed by TENANT when due; and the persons executing this Lease are duly authorized by the governing body of such corporation to execute and deliver this Lease (including the confession of judgment provisions hereinbefore contained) on behalf of the corporation.

46. Execution of Lease: The submission of this Lease for examination does not constitute a reservation of or option for the Leased Premises or any other space within the Shopping Center and shall vest no right in either party. This Lease shall become effective as a

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Lease only upon execution and legal delivery thereof by the parties hereto. This Lease may be executed in more than one counterpart, and each such counterpart shall be deemed to be an original document.

47. Guarantees: Deliberately Omitted.

48. Security: Deliberately Omitted.

49 First Months’ Rent: Contemporaneously with the execution of this Lease, TENANT shall pay to LANDLORD the first one (1) months’ rent in advance which shall be applied against the first one (1) months’ rent when the same comes due.

IN WITNESS WHEREOF, LANDLORD and TENANT have duly executed this Lease as of the day and year first above written.

ATTEST:	LANDLORD:
	100 BRENTWOOD ASSOCIATES, LP
/s/    Illegible	By:	/S/    IRWIN N. KROIZ
		Irwin N. Kroiz, PARTNER
ATTEST:	TENANT:
	THE BRYN MAWR TRUST COMPANY
/S/    GLORIA M. REIFF	By:	/s/    ROBERT J. RICCIARDI
Assistant Secretary		Robert J. Ricciardi
		Executive Vice President

If TENANT is a corporation, Lease should be executed by the President or Vice President and Secretary or Treasurer and the corporate seal should be affixed hereto.

If TENANT is a partnership, all partners should execute this Lease.

If TENANT is an individual or partnership, all signatures should be witnessed.

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EXHIBIT “B”

TENANT’S WORK

TENANT acknowledges that it is accepting the building in an “as-is” condition. TENANT shall be responsible for all costs related to improvements to the building and all costs related to repairs and maintenance of the building, including, but not limited to, roof and structural repairs.

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EXHIBIT “C”

SIGNS

It is understood and agreed that the TENANT shall have the right to signage similar to signs presently located in the Shopping Center which the demised premises is a part or signage which falls under the specifications set forth, whichever policy is then in effect. TENANT shall present to LANDLORD prior to construction and installation of any sign, a professionally drawn rendering specifying size, material, coloring, copy and any other specifications included but not limited to lighting and electrical load.

1. Signs shall be designed in accordance with local code requirements and regulations outlined in these Criteria.

2. No signs, other than at the locations outlined in these Criteria, will be permitted on the building.

3. Sign motifs for any signs or banners other than the pylon sign shall be submitted to LANDLORD for approval. LANDLORD’S approval of sign motifs shall not be unreasonably withheld so long as they meet the Criteria set forth herein.

4. No detached signs of any kind shall be permitted. No exterior theater attraction boards or changeable letter signs shall be permitted.

5. Except as herein provided, TENANT shall not be entitled to place any sign or advertising matter on the outer surface of the perimeter or surfaces of the Leased Premises nor shall TENANT be entitled to place any sign on the roof of the Leased Premises, unless TENANT receives all necessary governmental approvals and complies with all local zoning and similar ordinances and otherwise complies with the Criteria herein.

6. No flood lighting of signs or storefronts by TENANT shall be permitted, unless TENANT receives all necessary governmental approvals and complies with all local zoning and similar ordinances and otherwise complies with the Criteria herein.

7. The size, design, color, material, specific location, content, type of construction, method of mounting and illumination of each sign, as well as TENANT’S storefront design shall be subject to the approval of the LANDLORD. TENANT shall submit complete, detailed drawings, containing all of the above information for each sign to LANDLORD, for review and approval, along with actual samples of all sign materials.

8. The maximum height of all sign letters shall be two (2) feet, plus or minus, unless a larger sign is permitted by local code or a variance from such code is obtained by TENANT at its sole expense.

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9. LANDLORD at his absolute discretion reserves the right to waive any of the above provisions when circumstances warrant such action. LANDLORD may also amend the sign specifications from time to time.

10. TENANT is permitted to place in the interior of the Leased Premises, including on the glass of any window or door of the Leased Premises, neat, professionally prepared signs, which are presented in good taste, without the consent of LANDLORD required. If, however, the LANDLORD in its reasonable judgment deems the signs offensive, TENANT shall remove same within two (2) days after written notice thereof by LANDLORD. TENANT shall, at its sole cost and expense, maintain such sign, decoration, lettering, or advertising matter as may be permitted hereunder, in good condition and repair at all times.

11. Each sign shall be supported with non-corrosive type fastener, for example, stainless steel or aluminum. Holes drilled for fasteners or connections through the supporting wall must be applied with an acceptable water sealant, for example, clear silicone as to prevent leakage.

12. TENANT is entitled to place a sign on the Shopping Center pylon sign at its own expense. Such sign shall be of appropriate size and shape to fit in the place shown on the attached rendering of the pylon sign and shall meet all other Criteria set forth herein.

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EXHIBIT “D”

CONTRACTOR’S WAIVER OF LIEN

1. Affiant holds the position of                                                   with a licensed general contractor, a licensed subcontractor or materialman (herein called “Contractor” for purposes of convenience) and is authorized to give this Waive of Lien on behalf of said entity.

2. This Waiver of Lien is given to                                                   (herein called “LANDLORD”) for the benefit of LANDLORD, its lenders and their respective title companies, with the understanding that they may rely on this Waiver of Lien.

3. Contractor has contracted with                                                   (herein called “TENANT”) for certain services, materials, supplies, machinery and/or fixtures for the alteration and improvement of Premise known as Store No.         , (the “Premises”) located at                                                                   (the “Shopping Center”).

4. Contractor has not entered into any contract, written or oral, with LANDLORD or any agent or contractor of LANDLORD for the improvement of LANDLORD’S interest in the Shopping Center. Contractor agrees that neither it, nor any subcontractor or materialman, nor any other person furnishing labor or materials shall file any lien or assert any rights against LANDLORD or LANDLORD’S interest in the Shopping Center or any portion thereof and furthermore each of them hereby waives any liens or assertion furnished under any supplemental contact or arrangement for extra work in the erection, construction and completion of such building, buildings or improvements.

5. Prior to permitting any subcontractor or materialman to perform services or furnish material, Contractor will obtain and deliver to LANDLORD an executed Waiver of Lien in this form from each subcontractor or materialman.

6. Contractor agrees to indemnify and hold harmless LANDLORD, its lenders and their respective title companies from any and all claims, actions, demands, costs and expenses whatsoever including premiums on bonds and reasonable attorney’s fees at trial and on appeal arising out of or concerning this Waiver of Lien.

7. Nothing herein shall abridge or abrogate the right of the Contractor to assert any lien rights which it has or may have against any interest of TENANT in the Premises.

8. This Waiver of Lien shall be binding upon the Contractor, its heirs, successors and assigns and shall inure to the benefit of LANDLORD and the partners therein, and their respective successors, heirs and assigns.

9. For the purpose of effecting the Waiver of Lien contained herein, such Waiver of Lien shall be deemed a part of the Contractor’s contract as described in Paragraph 3 above, but it is understood and agreed that LANDLORD shall have no liability to the undersigned with respect to said contract.

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10. In the event any mechanic’s lien or claim is filed by Contractor, Contractor hereby irrevocably waives any right to a jury trial in any action to strike or discharge the lien.

11. If the Contractor files a mechanic’s lien, notwithstanding this Waiver, LANDLORD shall have the right to discharge the lien by appropriate legal proceedings and the right to be completely reimbursed and indemnified by Contractor against expenses and losses resulting from such lien. Such expenses and losses shall include any attorneys’ fees, surety bond premiums and other costs incurred in attempting to discharge or remove each lien, and any damages or other losses resulting from such lien, all of which the Contractor agrees to pay.

12. Contractor hereby warrants and represents that at the time of execution hereof, no work of any kind has been done and no materials or supplies of any kind have been furnished in connection with work in the Premises.

13. This Agreement and stipulation is made and intended to be filed with the County Prothonotary in accordance with requirements of Section 402 of the Mechanics’ Lien Law of 1963 of the Commonwealth of Pennsylvania (49 P.S. Sec. 1402).

IN WITNESS WHEREOF, the undersigned has hereunto set its hand and seal this              day of                         , 2004.

	CONTRACTOR
ATTEST:	If Contractor is a corporation
	BY:
WITNESS:	If Contractor is an individual or partnership:

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ACKNOWLEDGEMENT OF CONFESSION OF JUDGMENT AND

WAIVER OF NOTICE AND OPPORTUNITY TO BE HEARD PRIOR

TO ENTRY OF JUDGMENT AND ENFORCEMENT OF JUDGMENT

THE UNDERSIGNED ACKNOWLEDGES AND AGREES THAT THE UNDERSIGNED IS EXECUTING AND DELIVERING TO 100 BRENTWOOD ASSOCIATES, LP A GUARANTY AND SURETYSHIP WHICH CONTAINS A CONFESSION OF JUDGMENT CLAUSE PURSUANT TO WHICH 100 BRENTWOOD ASSOCIATES, LP IS AUTHORIZED TO ENTER A JUDGMENT AGAINST THE UNDERSIGNED AND IN FAVOR OF 100 BRENTWOOD ASSOCIATES, LP UPON THE OCCURRENCE OF AN EVENT OF DEFAULT UNDER THE GUARANTY AND SURETYSHIP. IN ADDITION, THE UNDERSIGNED ACKNOWLEDGES AND AGREES THAT PURSUANT TO THE CONFESSION OF JUDGMENT CLAUSE, 100 BRENTWOOD ASSOCIATES, LP IS ENTITLED TO ENTER A JUDGMENT FOR MONEY OR FOR POSSESSION OR BOTH UPON SAID DEFAULT. IN CONSIDERATION OF THE WILLINGNESS OF 100 BRENTWOOD ASSOCIATES, LP TO CONVEY POSSESSION OF THE PREMISES AS PROVIDED IN THE LEASE, THE UNDERSIGNED HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY ACKNOWLEDGES, CONSENTS AND AGREES AS FOLLOWS:

(a) THE UNDERSIGNED IS FULLY AWARE OF THE RIGHTS OF THE UNDERSIGNED TO PRIOR NOTICE AND HEARING ON THE VALIDITY OF ANY CLAIMS THAT MAY BE ASSERTED AGAINST THE UNDERSIGNED BY 100 BRENTWOOD ASSOCIATES, LP UNDER THE LEASE BEFORE JUDGMENT CAN BE ENTERED AND BEFORE ASSETS OF THE UNDERSIGNED CAN BE GARNISHED AND ATTACHED AND A RIGHT OF POSSESSION BE ENFORCED;

(b) THE UNDERSIGNED IS FULLY AWARE THAT BY AUTHORIZING CONFESSION OF JUDGMENT, THE UNDERSIGNED IS GIVING UP THE RIGHT OF THE UNDERSIGNED TO ANY NOTICE OR OPPORTUNITY TO BE HEARD PRIOR TO THE ENTRY OF JUDGMENT IN FAVOR OF 100 BRENTWOOD ASSOCIATES, LP AND PRIOR TO GARNISHMENT AND ATTACHMENT OF THE UNDERSIGNED’S ASSETS;

(c) THE UNDERSIGNED IS FULLY AWARE THAT A JUDGMENT ENTERED AGAINST THE UNDERSIGNED WILL CONSTITUTE A LIEN UPON ANY REAL ESTATE OF THE UNDERSIGNED LOCATED IN THE COUNTY IN WHICH JUDGMENT IS ENTERED AND WILL ENTITLE 100 BRENTWOOD ASSOCIATES, LP TO IMMEDIATE ATTACHMENT AND GARNISHMENT OF THE UNDERSIGNED’S ASSETS WITHOUT PRIOR NOTICE;

(d) THE UNDERSIGNED WAIVES THE RIGHT WHICH THE UNDERSIGNED HAS TO PRIOR NOTICE AND HEARING ON THE VALIDITY OF ANY CLAIMS THAT MAY BE ASSERTED AGAINST THE UNDERSIGNED BY FIRST 100 BRENTWOOD ASSOCIATES, LP UNDER THE GUARANTY AND SURETYSHIP AND AGREES THAT UPON THE OCCURRENCE OF AN EVENT OF DEFAULT UNDER THE LEASE

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GUARANTY AND SURETYSHIP, 100 BRENTWOOD ASSOCIATES, LP MAY OBTAIN A JUDGMENT FOR MONEY AGAINST THE UNDERSIGNED WITHOUT THE UNDERSIGNED’S PRIOR KNOWLEDGE OR CONSENT AND WITHOUT THE OPPORTUNITY TO RAISE ANY DEFENSE, SET OFF, COUNTERCLAIM OR OTHER CLAIM WHICH THE UNDERSIGNED MAY HAVE.

(e) THE UNDERSIGNED FURTHER WAIVES ANY RIGHTS WHICH THE UNDERSIGNED MAY HAVE TO NOTICE AND A HEARING PRIOR TO ENFORCEMENT OF A JUDGMENT FOR MONEY ENTERED BY 100 BRENTWOOD ASSOCIATES, LP.

(f) THE UNDERSIGNED ACKNOWLEDGES THAT THE UNDERSIGNED WILL BE UNABLE TO CHALLENGE THE JUDGMENT IN THE EVENT THAT 100 BRENTWOOD ASSOCIATES, LP ENTERS JUDGMENT FOR MONEY, EXCEPT BY PROCEEDING TO OPEN OR STRIKE THE JUDGMENT; AND THAT SUCH A PROCEEDING WILL REQUIRE PAYMENT OF ATTORNEY’S FEES AND COSTS BY THE UNDERSIGNED;

(g) THE UNDERSIGNED REPRESENTS AND WARRANTS THAT THE GUARANTY AND SURETYSHIP ENTERED INTO PERTAINS TO A COMMERCIAL BUSINESS TRANSACTION.

IN WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned have dully executed this Acknowledgment of Confession of Judgment this 16th day of March, 2004.

ATTEST:	THE BRYN MAWR TRUST COMPANY
/S/    GLORIA M. REIFF	BY:	/s/    ROBERT J. RICCIARDI
Assistant Secretary		Executive Vice President

41

MEMORANDUM OF LEASE

THIS MEMORANDUM OF LEASE is entered into by and between 100 BRENTWOOD ASSOCIATES, LP, a Pennsylvania limited partnership, having an office at 610 West Germantown Pike, Suite 340, Plymouth Meeting, PA 19462 (“Landlord”) and THE BRYN MAWR TRUST COMPANY, a Pennsylvania state chartered bank, having an office at 801 Lancaster Avenue, Bryn Mawr, PA 19010 (“Tenant”).

1. Demise. By a certain lease dated March 16, 2004 (the “Lease”) between Landlord and Tenant, Landlord has leased to Tenant, and Tenant has leased from Landlord, the premises outlined on the attached Exhibit “A,” being a portion of the real property known as                             , Chester County, Pennsylvania, being UPI No. 41-5-57.1, as more fully described in Exhibit “A” attached hereto (the “Premises”).

2. Incorporation by Reference. All provisions of the Lease are incorporated herein by reference.

3. Term. The initial term of the Lease is ten (10) years, commencing on April 1, 2004 and ending on March 31, 2014.

4. Options to Renew. Upon the expiration of the initial term, Tenant has the right and option to renew the Lease for a first option term of ten (10) years, and an additional second option term of nine (9) years and eleven (11) months. If so renewed by Tenant, the Lease term will end on February 28, 2034.

5. Recording Purposes. This Memorandum of Lease is intended for recording purposes, only and does not supersede, diminish, add to, or change the terms of the Lease.

IN WITNESS WHEREOF, this Memorandum of Lease is executed under seal on the 16^th day of March, 2004.

ATTEST:		LANDLORD:
		100 BRENTWOOD ASSOCIATES, LP,
		a Pennsylvania limited partnership
		By its general partner, POTTSTOWN PIKE
		CORP., a Pennsylvania corporation
By:	/s/    IRWIN N. KROIZ	By:	/s/    IRWIN N. KROIZ
	Irwin N. Kroiz, Secretary		Irwin N. Kroiz, President
		TENANT:
ATTEST:		THE BRYN MAWR TRUST COMPANY
By:	/S/    GLORIA M. REIFF	By:	/s/    ROBERT J. RICCIARDI
	Assistant Secretary		Robert J. Ricciardi, Executive Vice President

COMMONWEALTH OF PENNSYLVANIA :

COUNTY OF Montgomery                              :

AND NOW, this 16 day of March, 2004, before me, a Notary Public in and for the above state and county, personally appeared Robert J. Ricciardi and                         , who acknowledged themselves to be an Executive Vice President and Secretary, respectively, of The Bryn Mawr, Trust Company, and that they, being authorized to do so, executed the foregoing Memorandum of Lease for the purposes therein contained by signing the name of the Bank as said officers.

IN WITNESS WHEREOF, I have hereunto set my hand and notarial seal.

/s/    EMILY E. NORTON        

Notary Public

Notarial Seal

Emily E. Norton, Notary Public

Lower Metion Twp., Montgomery Country

My Commission Expires Mar. 21, 2005

Member, Pennsylvania Association of Notaries

COMMONWEALTH OF PENNSYLVANIA :

COUNTY OF Montgomery                              :

AND NOW, this 22^nd day of March, 2004, before me, a Notary Public in and for the above state and county, personally appeared Irwin Kroiz and                         , who acknowledged himself to be the Vice President respectively, of Pottstown Pike Corp., a Pennsylvania corporation, the sole general partner of 100 Brentwood Associates, LP, a Pennsylvania limited partnership, and that he, being authorized to do so, executed the foregoing Memorandum of Lease for the purposes therein contained by signing the name of the partnership as said officers of the partnership’s general partner.

IN WITNESS WHEREOF, I have hereunto set my hand and notarial seal.

/s/    KIMBERLY A. ROGERS        

Notary Public

COMMONHEALTH OF PENNSYLVANIA

NOTARIAL SEAL

KIMBERLY A. ROGERS, Notary Public

Lower Gwynedd Twp., Montgomery County

My Commission Expires February 2, 2008

EX-13

Exhibit 13

LETTER from the CHAIRMAN

The CHALLENGES of 2004 — Our SUCCESSES and Our DISAPPOINTMENTS

Let’s start with our successes.

• Our new branch in Newtown Square, Pennsylvania, which opened in January 2004, far exceeded expectations and finished the year with over $21 million of deposits. Credit goes to our manager, Barb Newcomer, and her caring staff.

• Our eighth full-service office is scheduled to open in March 2005 in Exton, Pennsylvania. We have an excellent site at the corner of Route 100 and Swedesford Road, which affords us superb visibility, access and egress, all of which are crucial for a successful branch office.

• We are close to finalizing a re-location of our Wynnewood office to a nearby, but far superior, site. This new location should enable us to grow that office at a much faster pace.

• In 2004, the Bank had a strong increase in loans (+12%) deposits (+14%), and total Corporation assets (+13%). This was a result of an active sales culture as well as a client retention rate far above industry averages.

• Our Wealth Management Division had another solid year with revenues up 6% and profitability up 9%. This follows 2003 where the figures were 11% and 21% respectively. In addition, we were able to recruit John Pickering to head up this area. Before joining Bryn Mawr Trust, John had been a top executive with the prestigious private bank, Brown Brothers Harriman.

• Our new Small Business Package was well received in the marketplace, with checking accounts and loans for this important constituency increasing sharply. Our low-cost, and in many cases free, package including a checking account, a line of credit, a credit card, a debit card, and computer banking, is the best offering of any bank in the entire Philadelphia area.

• Our stock price held up relatively well during 2004 despite our earnings results. Over the past four years we have seen the Corporation’s stock rise from $10.56 per share (adjusted for stock-splits) to $21.99 at year-end 2004, an appreciation of 108%.

Now, for the disappointments.

Our net income and earnings per share were below our normal levels of profitability. The confluence of three factors caused this to happen.

First, the low level of short-term interest rates throughout the year greatly impacted our net interest income. We began to get some relief towards the end of the year as the Federal Reserve started to increase interest rates. We should see the full benefit, however, in 2005.

Second, the residential refinancing boom ended and our mortgage division processed far fewer loans for resale into the secondary marketplace. If you look at the line “gain on sale of loans” on our income statement, you will see the large variance over the prior year.

PAGE 2

BRYN MAWR BANK CORPORATION

Third, provisions of the Sarbanes-Oxley legislation mandated certain actions by all public companies, including the Bank’s parent company, Bryn Mawr Bank Corporation. Our compliance costs for Sarbanes-Oxley alone were over $470,000 in actual cash and over 8,000 hours of our staff’s time. Fortunately, the burden of complying with this legislation going forward will be less onerous.

While some banks might have been satisfied with our results, we certainly were not. I anticipate a sharp improvement in our financial performance in 2005 as short-term interest rates rise, as our Wealth Management Division maintains its growth pattern, and as we continue our close control on overhead expenses.

As always, I would like to thank the Corporation’s Directors for their dedication and hard work. With the recent changes in corporate governance and regulatory oversight, their participation and contributions are more important than ever.

Thank you for your support and for being a shareholder of the Corporation.

Sincerely,

/s/    TED PETERS        

Ted Peters

Chairman and Chief Executive Officer

PAGE 3

2004 CORPORATE HIGHLIGHTS

Consolidated FINANCIAL HIGHLIGHTS

(Dollars in thousands, except per share amounts)

	2004			2003			Change
FOR THE YEAR
Net interest income	$	26,828		$	24,931		8	%
Other income		19,794			26,577		-26
Other expenses		31,625			33,437		-5
Income from continuing operations		9,345			11,272		-17
Net income		9,345			9,356		0
AT YEAR-END
Total assets	$	682,946		$	604,848		13	%
Total net loans		557,670			495,746		12
Total deposits		600,965			527,139		14
Shareholders’ equity		71,238			67,382		6
PER COMMON SHARE
Basic earnings per common share from continuing operation	$	1.09		$	1.30		-16	%
Diluted earnings per common share from continuing operation		1.06			1.28		-17
Basic earnings per common share		1.09			1.08		1
Diluted earnings per common share		1.06			1.06		0
Dividends declared		.40			.40		0
Book value		8.29			7.77		7
Closing price		21.99			24.10		-9
SELECTED RATIOS*
Return on average assets		1.45	%		1.98	%
Return on average shareholders’ equity		13.67			17.76

* Selected ratios are based on income from continuing operations.

Significant CORPORATE HIGHLIGHTS

• Expanding our footprint

• Special focus on small business initiative

• Strong growth in loans and deposits

• New residential mortgage strategies

• Media recognition of expertise of BMT wealth professionals

PAGE 4

BRYN MAWR BANK CORPORATION

SHAREHOLDERS’ EQUITY (Dollars in millions)	EARNINGS PER COMMON SHARE FROM CONTINUING OPERATIONS (Dollars)	COMMON STOCK MARKET VALUE (Dollars per share)	COMMON STOCK BOOK VALUE (Dollars per share)
TOTAL ASSETS (Dollars in millions)	TOTAL NET LOANS (Dollars in millions)	TOTAL DEPOSITS (Dollars in millions)	NET INCOME FROM CONTINUING OPERATIONS (Dollars in millions)

* Reclassified for comparative purposes

PAGE 5

THE YEAR in REVIEW 2004

EXPANDING Our FOOTPRINT

During 2004, we focused on expanding and upgrading our branch office network and already we are seeing positive results.

As the year 2004 began, we were in the final construction phase of the handsome edifice that now serves as our Newtown Square office. As 2004 drew to a close, the finishing touches to the major renovation project were being accomplished at our newest facility in Exton.

The opening of our Newtown Square office was extremely successful on all counts. First year business volume has far exceeded expectations. This is a testament to the continued importance of convenient neighborhood banking and to the dedication and diligence of the branch office staff. The award-winning building itself has been hailed as a definite enhancement to the Newtown Square business area. The commissioning of the painting “Newtown Square Station” by local artist Nick Santoleri heightened for the local residents their appreciation of their heritage and drew attention from the public at large to the historical significance of this area.

The acquisition of an office site in Exton and its complete renovation is also becoming an exciting project. A rather pedestrian functional building has been transformed into a striking landmark similar in style to the Newtown Square building. The office is expected to open for business in March and grand opening festivities will be scheduled throughout the spring.

As in Newtown Square, groundwork is already underway to weave Bryn Mawr Trust into the entire fabric of the community: the large corporate presence, the ever-expanding small business community, and the rapidly expanding residential community. Our goal is to ensure the fiscal soundness of businesses, individuals and future generations. Negotiations are also in progress to acquire a better strategic location for the community now served by our office in Wynnewood.

PAGE 6

BRYN MAWR BANK CORPORATION

Our efforts have not been limited to enhancing our physical environment. Building for the future encompasses an element even more important than our physical plant.

Our OBSESSION is

to PROVIDE

SUPERB PERSONAL

SERVICE to

our CLIENTS

Strategies have been put in place to enable Bryn Mawr Trust to continue to be a high-performing financial institution.

Our intention is to continue to concentrate on our four core competencies — wealth management services, business banking, value-added retail banking and residential mortgage banking. Above all, we will maintain our commitment to high values, integrity, teamwork and respect for our clients, our fellow workers and the community at large.

Retail Banking Executive Vice President Robert J. Ricciardi and Exton Branch Manager Vice President Annette C. McNee check the progress of renovations at the Exton office site.

PAGE 7

THE YEAR in REVIEW 2004

SMALL BUSINESS INITIATIVE Gains MOMENTUM

Group Vice President Regina F. Kemery is dedicated to alerting the small business community to our excellent package of services tailor-made to meet their financial needs.

Our all-inclusive platform of services is extremely well received.

Our small business banking team, which includes all of our branch managers and is headed up by seasoned banking professional Regina Kemery, has initiated a massive calling effort to acquaint small businesses with our small business package — a platform of services first introduced in the spring of 2003. The team members have become intricately involved with the business community, actively participating in local business organizations and establishing themselves as the definitive resource for business financial information. Their efforts have been extremely successful.

To complement the services included in the small business package, and to enable our small business client to respond quickly to customer needs and effectively manage the bottom line, Bryn Mawr Trust recently introduced the Bryn Mawr Trust Productivity Card for Business.

At year-end 2004, Bryn Mawr Trust made arrangements to introduce a forum of educational programs on topics of interest to the small business owner. The first program, which was held in January of 2005, addressed the retirement planning issues that will impact financial support of senior business members in retirement. It also addressed financial support of the managing generation, as well as the successful operation of the business.

PAGE 8

BRYN MAWR BANK CORPORATION

CONSISTENT EFFORT PAYS OFF

The Bank enjoyed strong growth in total outstanding loans and a healthy increase in deposits.

Advances in business must be sustained by the solid dependable effort of dedicated staff members consistently providing the backbone upon which a strong financial footing is based. This is best exemplified by the untiring efforts of our commercial lenders, commercial real estate lenders and the consumer lending team. The fruits of their outreach and attention to the client have produced a healthy increase in loans as well as deposits and a firm roster of dedicated and loyal clients. We get to know our clients, their financial goals and pride ourselves on helping them attain these goals.

REACHING OUT to really

GET TO KNOW

our CLIENTS

To reinforce the importance of focusing on the needs of the client, a company-wide referral program was instituted in 2001. Our staff seeks to cultivate expanded relationships with existing clients by learning as much as possible about each individual’s financial situation. A discussion of the many services that the bank has to offer is encouraged. In 2004, a total of 2,222 referrals were generated through this program.

Commercial Banking Group Vice President George M. Teplica serves on the planning committee for expanding our commercial business in the Newtown Square and Exton communities.

PAGE 9

THE YEAR in REVIEW 2004

RESIDENTIAL MORTGAGE MARKET CHALLENGE

Recently appointed Bryn Mawr Trust Vice President Susan S. Shute, a real estate veteran, and BMT Mortgage President Myron H. Headen, a long-term Bryn Mawr Trust staff member.

New strategies, new dimensions and new faces are being brought into play.

In 2004, there were two major challenges facing our Residential Mortgage team. One was the unexpected departure of BMT Mortgage’s three senior officers. Even more dramatic was the collapse of the residential refinancing boom.

Myron Headen, an 18-year Bryn Mawr Trust veteran, was appointed President of BMT Mortgage Company. Assisted by senior staff members, he has expertly led the residential mortgage lending team throughout this troubled time. Our advertising effort in this area has been greatly beefed up, and a 30-year real estate industry veteran has come on board.

We’re KNOWN for our

SOLID EXPERIENCE

and SUPERIOR

SERVICE

An innovative new strategy for attracting new mortgage business is in the process of being implemented. Negotiations were started for the formation of a new BMBC subsidiary, whereby BMT Mortgage would handle the mortgage financing needs of a major agency, Keller Williams Main Line Realty.

PAGE 10

BRYN MAWR BANK CORPORATION

WEALTH MANAGEMENT Strengthens LEADERSHIP

Technology is providing a firm foundation for future growth.

A key administrative enhancement in 2004 was the implementation of a new Wealth Management accounting system. The conversion to the new system was a major effort for the entire Wealth Management Division and Trust Operations staff. Clients now reap the benefit of an easy-to-understand statement and a secure on-line internet system that allows access to real-time account information. Also, they now have the ability to monitor unrealized gains and losses on-line.

In recognition of the importance of wealth management and trust services as a key ingredient for sustained business growth, John Pickering was chosen to head up the Wealth Management Division. Mr. Pickering comes to Bryn Mawr Trust after a long and successful tenure at Brown Brothers Harriman in Philadelphia, Pa.

In August of 2004, Karen A. Fahrner, Esquire joined the Wealth Management Division as Senior Vice President and head of Trust Administration. She has over 30 years experience in the trust and estate field. She was a partner at the law firm, Pelino & Lentz, P.C. in Philadelphia. A member of the Pennsylvania and Florida Bars, she is the author of a highly regarded treatise on Pennsylvania trust and estate law.

During 2004, the Employee Benefit Department of the Wealth Management Division was renamed the “Retirement

Executive Vice President John Pickering has overseen Wealth Management’s continued growth and increased revenue.

PAGE 11

THE YEAR in REVIEW 2004

A TRUSTED SOURCE of FINANCIAL INFORMATION

Senior Vice President Karen A. Fahrner brings 30 years of experience in the trust and estate field to her position as head of Trust Administration.

Services Department” to more accurately reflect the services this group offers to clients. Bryn Mawr Trust’s Retirement Services Department offers a complete range of services for group retirement plans. The Retirement Services Department is also responsible for Bryn Mawr Bank Corporation’s Thrift & Savings Plan, Defined Benefit Pension Plan, Deferred Bonus Plan for executives, and the Deferred Payment Plan for directors.

Our CLIENTS

EXPECT the most

DISCERNING ADVICE &

GUIDANCE.

And THEY GET IT.

The Wealth Management Division continued its series of informational and educational programs for the legal community, CPAs, clients and the public at large. One of the most well received programs was held in October 2004 on the subject of Managing an Inheritance. Two distinguished guest speakers offered their perspectives on the financial and emotional issues involved with the inter-generational transfer of wealth.

PAGE 12

BRYN MAWR BANK CORPORATION

MAKING NATIONAL NEWS

Our Portfolio Managers and Wealth Consultants have become a much-sought-after source for their financial commentary, perspective and expert advice.

On April 15, 2004, Bryn Mawr Bank Corporation celebrated its 20th consecutive year on the NASDAQ Exchange, and 115 years of Bryn Mawr Trust’s dedication and service to the Philadelphia region with Ted Peters presiding over the NASDAQ opening bell ceremonies. The Bryn Mawr Trust Company, which opened for business in 1889, was accepted as a member of the NASDAQ National Market in 1985. Effective January 2, 1987, Bryn Mawr Bank Corporation was formed as a bank holding company with The Bryn Mawr Trust Company as a wholly owned subsidiary. CNN, CNBC, CNNfn, Fox News, CNN Headline News and BLOOMBERG USA, among others, aired the opening ceremonies.

REGULARLY

FEATURED

on TELEVISION, RADIO

& FINANCIAL MEDIA

Bryn Mawr Bank Corporation dominates Times Square during NASDAQ Opening Ceremony. Bryn Mawr Trust’s portfolio managers and wealth consultants have become nationally recognized for their expertise and valued opinions.

PAGE 13

THE YEAR in REVIEW 2004

CORPORATE INFORMATION

CORPORATE HEADQUARTERS

801 Lancaster Avenue

Bryn Mawr, Pennsylvania 19010-3396

610-525-1700

www.bmtc.com

DIRECTORS

Warren W. Deakins

Self-employed, Insurance Sales

Andrea F. Gilbert

President, Bryn Mawr Hospital

William Harral, III

Chairman, C&D Technologies, Inc.; President, the Barra Foundation

Wendell F. Holland

Chairman, Pennsylvania Public Utilities Commission

Francis J. Leto

Partner, Celli and Leto, LLP, Attorneys at Law; President, The Brandywine Abstract Companies

Frederick C.“Ted” Peters II

Chairman, President and Chief Executive Officer, Bryn Mawr Bank Corporation and The Bryn Mawr Trust Company

James J. Smart

Managing Partner, Smart and Associates, LLP, a certified public accounting firm

B. Loyall Taylor, Jr.

President, Taylor Gifts, Inc.

Nancy J. Vickers

President, Bryn Mawr College

Thomas A. Williams

Retired, formerly Vice President, Secretary/Treasurer, Houghton International, Inc.

MARKET MAKERS

Boenning & Scattergood

Citigroup Global Markets

FTN Midwest Securities Corp.

Goldman, Sachs & Co.

Hill, Thompson, Magid & Coe

Janney Montgomery LLC

Keefe, Bruyette & Woods Inc.

Knight Equity Markets, L.P.

McConnell Budd & Downes

Merrill Lynch, Pierce Fenner & Smith

Moors & Cabot, Inc.

Morgan Stanley & Co., Inc.

Ryan Beck & Co., Inc.

Susquehanna Capital Group

UBS Capital Markets L.P.

PRINCIPAL SUBSIDIARY

The Bryn Mawr Trust Company

A Subsidiary of Bryn Mawr Bank Corporation

EXECUTIVE MANAGEMENT

Frederick C. “Ted” Peters II*

Chairman, President and Chief Executive Officer

Alison E. Gers

Executive Vice President, Support Division, Administration and Operations

Joseph G. Keefer

Executive Vice President, Credit Division, and Chief Lending Officer

John Pickering

Executive Vice President, Wealth Management Division

Joseph W. Rebl*

Executive Vice President, Finance Division, Corporate Treasurer, and Chief Financial Officer

Robert J. Ricciardi*

Executive Vice President, Retail Banking, Chief Credit Policy Officer and Corporate Secretary

* Also officer of the Corporation

BRANCH OFFICES

801 Lancaster Avenue

Bryn Mawr, Pennsylvania 19010

237 North Pottstown Pike

Exton, Pennsylvania 19341

18 West Eagle Road

Havertown, Pennsylvania 19083

3601 West Chester Pike

Newtown Square, PA 19073

39 West Lancaster Avenue

Paoli, Pennsylvania 19301

330 East Lancaster Avenue

Wayne, Pennsylvania 19087

One Tower Bridge

West Conshohocken,

Pennsylvania 19428

312 East Lancaster Avenue

Wynnewood, Pennsylvania 19096

WEALTH MANAGEMENT DIVISION

10 South Bryn Mawr Avenue

Bryn Mawr, Pennsylvania 19010

LIMITED SERVICE OFFICES

Beaumont at Bryn Mawr Retirement Community

Bryn Mawr, Pennsylvania

Bellingham Retirement Living

West Chester, Pennsylvania

Martins Run Life Care Community

Media, Pennsylvania

Rosemont Presbyterian Village

Rosemont, Pennsylvania

The Quadrangle

Haverford, Pennsylvania

Waverly Heights

Gladwyne, Pennsylvania

White Horse Village

Newtown Square, Pennsylvania

OTHER SUBSIDIARIES AND FINANCIAL SERVICES

BMT Mortgage Company

A Division of The Bryn Mawr Trust Company

Bryn Mawr, Pennsylvania

Myron H. Headon, President

BMT Settlement Services, Inc.

A Subsidiary of The Bryn Mawr Trust Company

Bryn Mawr, Pennsylvania

Joseph G. Keefer, Chairman

Myron H. Headon, President

Insurance Counsellors of Bryn Mawr, Inc.

A Subsidiary of The Bryn Mawr Trust Company

Bryn Mawr, Pennsylvania

Thomas F. Drennan, President

PAGE 14

BRYN MAWR BANK CORPORATION

ANNUAL MEETING

The Annual Meeting of Shareholders of Bryn Mawr Bank Corporation will be held in The Gregg Conference Center at The American College, Bryn Mawr, Pennsylvania, on Tuesday, April 19, 2005, at 2:00 p.m.

AUDITORS

KPMG LLP

1601 Market Street

Philadelphia, Pennsylvania 19103-2499

LEGAL COUNSEL

Monteverde, McAlee & Hurd, P.C.

One Penn Center at Suburban Station

1617 John F. Kennedy Boulevard

Suite 1500

Philadelphia, Pennsylvania 19103-1815

STOCK LISTING

Bryn Mawr Bank Corporation common stock is traded over-the-counter and is listed on the NASDAQ National Market System under the symbol BMTC.

FORM 10-K

A copy of the Corporation’s Form 10-K, including financial statement schedules as filed with the Securities and Exchange Commission, is available without charge to shareholders upon written request to Robert J. Ricciardi, Secretary, Bryn Mawr Bank Corporation, 801 Lancaster Avenue, Bryn Mawr, Pennsylvania 19010-3396, or via e-mail to bricciardi@bmtc.com.

EQUAL EMPLOYMENT OPPORTUNITY

The Corporation continues its commitment to equal opportunity employment and does not discriminate against minorities or women with respect to recruitment, hiring, training, or promotion. It is the policy of the Corporation to comply voluntarily with the practices of Affirmative Action.

REGISTRAR & TRANSFER AGENT

Mellon Investor Services L.L.C.

P.O. Box 3315

South Hackensack, NJ 07606

www. mellon-investor.com

PRICE RANGE of SHARES

	High Bid		Low Bid		Dividend Declared
2004 HIGH-LOW QUOTATIONS
First quarter	$	24.26	$	21.50	$	0.10
Second quarter		23.73		19.30		0.10
Third quarter		22.82		19.67		0.10
Fourth quarter		22.55		19.10		0.10
2003 HIGH-LOW QUOTATIONS
First quarter	$	19.19	$	17.08	$	0.10
Second quarter		20.50		17.39		0.10
Third quarter		21.81		18.50		0.10
Fourth quarter		25.07		20.00		0.10

The approximate number of registered holders of record of common stock as of December 31, 2004 was 370.

The shares are traded on the over-the-counter market, and the price information was obtained from The National Association of Securities Dealers (NASD).

PAGE 15

Selected Financial Data

	(in thousands, except for share and per share data)
For the years ended December 31,	2004			2003*			2002*			2001*			2000*
Interest income	$	31,381		$	29,261		$	29,412		$	30,311		$	31,985
Interest expense		4,553			4,330			4,484			6,302			7,072
Net interest income		26,828			24,931			24,928			24,009			24,913
Loan loss provision		900			750			1,000			1,200			250
Net interest income after loan loss provision		25,928			24,181			23,928			22,809			24,663
Other income		19,794			26,577			23,899			18,846			15,322
Other expenses		31,625			33,437			31,642			28,199			27,854
Income before income taxes and discontinued operations		14,097			17,321			16,185			13,456			12,131
Applicable income taxes		4,752			6,049			5,543			4,524			4,137
Income from continuing operations		9,345			11,272			10,642			8,932			7,994
(Loss) income from discontinued operations		—			(1,916	)		(435	)		194			267
Net Income	$	9,345		$	9,356		$	10,207		$	9,126		$	8,261
Per share data
Earnings per common share from continuing operations:
Basic	$	1.09		$	1.30		$	1.22		$	1.03		$	0.93
Diluted	$	1.06		$	1.28		$	1.20		$	1.00		$	0.90
Earnings per common share
Basic	$	1.09		$	1.08		$	1.17		$	1.05		$	0.96
Diluted	$	1.06		$	1.06		$	1.15		$	1.02		$	0.93
Dividends declared	$	0.40		$	0.40		$	0.38		$	0.36		$	0.34
Weighted-average shares outstanding		8,610,171			8,657,527			8,706,390			8,651,040			8,585,676
Dilutive potential common shares		170,545			158,543			130,020			254,180			322,816
Adjusted weighted-average shares		8,780,716			8,816,070			8,836,410			8,905,220			8,908,492
	(in thousands)
At December 31,	2004			2003			2002*			2001*			2000*
Total assets	$	682,946		$	604,848		$	577,242		$	476,823		$	444,424
Earning assets		628,754			547,637			520,562			427,805			389,053
Deposits		600,965			527,139			483,620			391,059			386,966
Shareholders’ equity		71,238			67,382			62,607			57,307			50,970
Ratio of equity to assets		10.43	%		11.14	%		10.85	%		12.02	%		11.47	%
Loans serviced for others		507,421			797,326			631,105			442,373			325,040
For the years ended December 31,	2004			2003			2002*			2001*			2000*
Selected financial ratios:
Net interest margin		4.46	%		4.70	%		5.34	%		5.85	%		6.33	%
Income from continuing operations to:
Average total assets		1.45	%		1.98	%		2.01	%		2.05	%		1.94	%
Average shareholders’ equity		13.67	%		17.76	%		17.26	%		16.95	%		17.20	%
Average shareholders’ equity to average total assets		10.64	%		11.13	%		11.67	%		12.09	%		11.28	%
Dividends declared per share to net income per basic common share		36.85	%		37.01	%		32.41	%		34.13	%		35.34	%

* Reclassified for comparative purposes

1

Management’s Discussion and Analysis

The following is a discussion of the consolidated results of operations of Bryn Mawr Bank Corporation and its subsidiaries (the “Corporation”) for each of the three years ended December 31, 2004, as well as the financial condition of the Corporation as of December 31, 2004 and 2003. The Bryn Mawr Trust Company (the “Bank”), and Joseph W. Roskos & Co. (“JWR & Co.”) are wholly-owned subsidiaries of the Corporation. Insurance Counsellors of Bryn Mawr, Inc. (“ICBM”) and BMT Settlement Services, Inc. (“BMTSS”) are wholly owned subsidiaries of the Bank. This discussion should be read in conjunction with the Corporation’s consolidated financial statements beginning on page 26.

SPECIAL CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

Certain of the statements contained in this Report may constitute forward-looking statements for the purposes of the Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended, and may involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of the Corporation to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements include statements with respect to the Corporation’s financial goals, business plans, business prospects, credit quality, credit risk, reserve adequacy, liquidity, origination and sale of residential mortgage loans, impairment of goodwill, the effect of changes in accounting standards, and market and pricing trends. The words “expect,” “anticipate,” “intended,” “plan,” “believe,” “seek,” “estimate,” and similar expressions are intended to identify such forward-looking statements. The Corporation’s actual results may differ materially from the results anticipated by the forward-looking statements due to a variety of factors, including without limitation:

• the effect of future economic conditions on the Corporation and its customers, including economic factors which affect consumer confidence in the securities markets, wealth creation, investment and savings patterns, and the Corporation’s interest rate risk exposure and credit risk;

• changes in the securities markets with respect to the market values of financial assets and the stability of particular securities markets;

• governmental monetary and fiscal policies, as well as legislation and regulatory changes;

• changes in accounting requirements or interpretations;

• the risks of changes in interest rates on the level and composition of deposits, loan demand, and the value of loan collateral and securities, as well as interest rate risk;

• the effects of competition from other commercial banks, thrifts, mortgage companies, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money-market and mutual funds and other institutions operating in the Corporation’s trade market area and elsewhere including institutions operating locally, regionally, nationally and internationally and such competitors offering banking products and services by mail, telephone, computer and the Internet;

• any extraordinary events (such as the September 11, 2001 events, the war on terrorism and the U.S. Government’s response to those events, including the war in Iraq);

• the Corporation’s success in continuing to generate new business in its existing markets, as well as its success in identifying and penetrating targeted markets and generating a profit in those markets in a reasonable time;

• the Corporation’s ability to continue to generate satisfactory investment results for customers and the ability to continue to develop investment products in a manner that meets customers needs;

• the Corporation’s timely development of competitive new products and services in a changing environment and the acceptance of such products and services by customers;

• the Corporation’s ability to originate and sell residential mortgage loans;

• the accuracy of assumptions underlying the establishment of reserves for loan losses and estimates in the value of collateral, and various financial assets and liabilities and technological changes being more difficult or expensive than anticipated; and

• the Corporation’s success in managing the risks involved in the foregoing.

All written or oral forward-looking statements attributed to the Corporation are expressly qualified in their entirety by the foregoing cautionary statements. All forward-looking statements included in this Report are based upon information presently available, and the Corporation assumes no obligation to update any forward-looking statements.

2

Introduction

The Corporation derives the vast majority of its income from its primary subsidiary, the Bank. The Bank is a state chartered member bank of the Federal Reserve System and was chartered in 1889. Located in an affluent western suburb of Philadelphia, Pennsylvania, the Bank provides commercial banking, trust and fiduciary services to its customer base. In 1986, the Corporation was formed and on January 2, 1987, the Bank became a wholly-owned subsidiary of the Corporation. The Corporation’s profitability is primarily derived from a number of segments or lines of business within the Bank. The traditional Banking segment includes the generation of net interest income from the gathering of deposits and funding of commercial, real estate and consumer loans, and the ability to purchase and sell investment securities. Due primarily to the structure of its deposit base, providing a source of low cost funding, the Bank was able to maintain a net interest margin of 4.46% for 2004.

In addition to its traditional banking activities of deposit gathering and lending, the Bank’s Wealth Management segment provides a stream of revenue, primarily related to its ability to grow its assets under management, which amounted to $1,887,000,000 as of December 31, 2004. In addition to the assets stated above the Bank acts as an investment advisor for $51,000,000 of assets for Community Banks located in Harrisburg, Pennsylvania.

Executive Summary

In prior years, the Bank’s Mortgage Banking segment had grown significantly. This growth was due to the increased demand for mortgage loans and the Mortgage Banking segment’s ability to meet the demands of its customers to originate and to then sell those mortgages to the secondary residential mortgage market. This demand slowed sharply beginning in the third quarter 2003 through December 31, 2004. While the Mortgage Banking segment had expanded its volume of residential loan originations and sales in prior years, recent volume decreases indicate that the demand for mortgage loans is likely to remain at a reduced level causing a reduction in the Bank’s mortgage loan originations and sales compared to the years prior to 2003. This decrease in residential mortgage loan origination and sale activity was primarily responsible for the Corporation’s lack luster 2004 income from continuing operations, which was 17% below 2003.

In addition to these three business segments, the Bank presently offers through ICBM insurance products which include commercial, personal lines, life and benefits insurance products.

Both the Corporation’s and Bank’s capital levels remain above those capital levels necessary to be considered “Well Capitalized” by their respective regulators. “Well Capitalized” is the highest rating available from the regulators. The Corporation’s annualized return on equity was 13.67% and its annualized return on assets was 1.45% as of December 31, 2004. The Uniform Bank Performance Report Peer Group Data as of September 30, 2004, the most recent data available, for banks with assets between $300 million and $1 billion had an annualized return on equity of 13.32% and an annualized return on assets of 1.21%.

The $3,224,000 decrease in income before income taxes and discontinued operations for 2004, over the same period in 2003, is primarily due to the decrease in residential mortgage originations and sales, as well as expenses associated with the implementation of the requirements of section 404 of the Sarbanes Oxley Act of 2002 (“SOX-404”). The gains on the sale of residential mortgage loans declined $7,751,000 and the related title insurance income from BMTSS declined $342,000. Partially offsetting the decline in income, due to the reduction in mortgage loan sale activity, was a decrease of $1,975,000 in the amortization of mortgage servicing rights (“MSRs”). During the first quarter of 2004, the Bank sold MSRs, generating a net gain, after the accelerated amortization of the sold MSRs, of $1,145,000. No such sales or gains were reported for 2003. In order to become compliant with SOX-404, the Corporation incurred an expense of $470,000 for consulting and accounting fees for 2004. No such fee expense was incurred in 2003. It is anticipated that fees for SOX-404 related activity will be less in 2005 and thereafter.

Also partially offsetting the decline in gains on mortgage loan sales was an increase in net interest income of $1,897,000 for 2004 compared to 2003 due primarily to strong growth in the Bank’s earning assets. The Bank’s balance sheet is asset interest rate sensitive, meaning that an increase in interest rates should cause an increase in the net interest margin and related net interest income. Recent prime rate increases have, and should continue to have, a positive effect on net interest income. The fees for trust services also increased in 2004 compared to 2003, up by $603,000 or 6%. In addition to the reduction in amortization of MSRs, discussed previously, the Corporation’s other operating expenses decreased by $947,000 or 20%. The decrease in residential loan sale activity is directly responsible for a $1,202,000 or 59% decrease in other operating expenses in the Mortgage Banking segment. There was an increase in the provision for loan loss of $150,000, due to an increase in net charge-offs in the second half of 2004. These net changes, from 2003 to 2004, account for $2,983,000 in year-to-year changes in income before income taxes and discontinued operations, compared to the net change reported of $3,224,000.

Critical Accounting Policies

The Corporation’s most critical accounting policy is the allowance for loan loss. The allowance for loan loss represents management’s estimate of the loan losses that may occur. The allowance is continually monitored to determine its adequacy. Ongoing review of credit standards, the level of delinquencies on loan products and loan segments, and the current state of the economy are included in this review. Actual losses may differ from management’s estimates. This is explained in more detail on pages 11 - 12.

3

In December 2001, the Corporation adopted Statement of Financial Accounting Standard No. 142 “Goodwill and Other Intangible Assets” (“SFAS No. 142”). In compliance with SFAS No. 142, the Corporation ceased amortizing the goodwill related to JWR & Co. During 2003, Corporation management determined that JWR & Co. was not attaining its strategic goals and that it would be in the best interest of the Corporation to discontinue offering family office services through JWR & Co. Therefore, the Corporation sold substantially all of the assets of JWR & Co. to Private Family Office, Inc. (“PFO”), which is owned by the former president of JWR & Co. (the “Asset Sale”). The Asset Sale was accomplished on August 1, 2003, effective as of June 30, 2003. The Asset Sale resulted in the charge-off of the balance of goodwill on the books of the Corporation, amounting to $1,005,000. As of December 31, 2003 and 2004, there was no goodwill on the books of the Corporation.

Since the assets which were sold in the Asset Sale met all the requirements of Statement of Financial Accounting Standard No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS No. 144”), other revenue and expenses, the write-down of goodwill and other related disposal expenses have been classified as a loss from discontinued operations, net of taxes in the respective statements of income, to reflect the accounting for discontinued operations under SFAS No. 144. There are no longer any assets of JWR & Co. associated with the family office operation on the books of JWR & Co. at December 31, 2004 or 2003.

As a part of its Mortgage Banking segment’s loan servicing business, the Bank records the value of MSRs as an asset when the mortgage loans are sold and the servicing is retained by the Bank. MSRs represent the right to receive cash flows from servicing mortgage loans. The servicing rights are capitalized based on the fair value of the servicing right and the mortgage loan on the date the mortgage loan is sold. MSRs are amortized in proportion to and over the period of the estimated net servicing income. MSRs are carried at the lower of cost or estimated fair value. The Corporation obtains an independent appraisal of the fair value of its MSRs quarterly, which approximates the fair value expected in a sale between a willing buyer and seller.

MSRs are assessed quarterly for impairment based on the estimated fair value of those rights. For purposes of performing the impairment valuation, the MSR portfolio is stratified on the basis of certain predominant risk characteristics, including loan type and note rate. To the extent that the carrying value of the servicing rights exceeds estimated fair value for any stratum, a valuation allowance is established; this allowance may be adjusted in the future as the estimated fair value of the MSRs increase or decrease. This valuation allowance is included in the consolidated balance sheet and the valuation allowance is recognized in the consolidated statement of operation during the period in which the change occurs.

The following summarizes the Corporation’s activity related to MSRs for the twelve months ended December 31, 2004 and 2003:

(In thousands)	2004			2003
Balance, January 1	$	4,391		$	3,956
Additions		1,019			3,249
Amortization		(839	)		(2,814	)
Impairment		—			—
Sales		(1,399	)		—
Balance, December 31	$	3,172		$	4,391
Fair Value	$	4,132		$	6,828

There has been no impairment of the MSR portfolio or any change in the valuation allowance for MSRs for the twelve months ended December 31, 2004 or 2003.

At December 31, 2004, key economic assumptions and the sensitivity of the current fair value of MSRs to immediate 10 and 20 percent adverse changes in those assumptions are as follows:

	December 31, 2004
Fair value amount of MSRs	$	4,132
Weighted average life (in years)		3.7
Prepayment speeds (constant prepayment rate) (1):		19.92	%
Impact on fair value:
10% adverse change		(293	)
20% adverse change		(558	)
Discount rate:		10.05	%
Impact on fair value:
10% adverse change		(128	)
20% adverse change		(248	)

(1) Represents the weighted average prepayment rate for the life of the MSR asset

These assumptions and sensitivities are hypothetical and should be used with caution. As the figures indicate, changes in fair value based on a 10% variation in assumptions generally cannot be extrapolated because the relationship of the change in assumptions to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the MSRs is calculated without changing any other assumption. In realty, changes in one factor may result in changes in another, which could magnify or counteract the sensitivities.

New Accounting Pronouncements

During 2004, the Financial Accounting Standards Board issued one accounting standard applicable to banks, revised Financial Interpretation No. 46 (FIN 46R) and the Emerging Issues Task Force issued EITF 03-1. These pronouncements are discussed in detail in Note 2 to the Consolidated Financial Statements – Summary of Significant Accounting Policies, which are a part of this Report.

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SIGNIFICANT ITEMS FOR 2004

Opening of New Full Service Branch Office in Newtown Square

During the first quarter of 2004, the Bank established a new full service branch office in Newtown Square, Pennsylvania, thereby enabling the Bank to both broaden and strengthen its footprint in Delaware County. By December 2004, the branch reported total deposits of $21 million.

Sale of Servicing for $245 million in Loans Serviced for Others

Effective March 31, 2004, the Bank sold MSRs associated with $245 million in mortgage loans serviced for others to EVERBANK, a federal savings bank located in Jacksonville FL. The transaction generated a net gain on the sale of $1,145,000. This gain on the sale of the MSRs helped to mitigate the negative impact on earnings caused by the decline in gains on the sale of residential mortgage loans in the Mortgage Banking segment, compared to gains in 2003 and 2002. The primary reason for the decline in gains on loan sales was a decrease in the amount of residential mortgage loan refinances sold to the secondary mortgage market in 2004, compared to 2003 and 2002.

Continuation of the Stock Repurchase Program

Corporation management continues to believe that the repurchase of the Corporation’s stock is a very beneficial use of Corporation capital. In October 2002, management was authorized to repurchase up to 4% of the outstanding shares as of October 2002 or 348,094 shares, effective January 2003, while not spending more than $7,500,000. Under that program, from January 2004 through December 2004, the Corporation repurchased 114,600 shares of Corporation stock, at a cost of $2,574,000, for an average cost of $22.46 per share. To date the shares repurchased under this program total 213,600 at a cost of $4,401,000. This stock repurchase program is authorized to extend for a five-year period, with annual reviews by the Corporation’s Board of Directors. The Corporation’s stock repurchasing activity, from 1997 through December 31, 2004, resulted in the repurchase of a total of 1,407,252 shares of the Corporation’s common stock, at a cost of $20,797,000 for an average purchase price of $14.78 per share. The use of the Corporation’s capital to repurchase stock increases the Corporation’s return on equity, as well as offsetting the dilutive effect on earnings per share of issuing stock options.

Compliance with Section 404 of the Sarbanes Oxley Act of 2002

As required by SOX-404, during 2004, the Corporation undertook a project to determine (1) what internal controls for public financial reporting were in place and (2) what additional internal controls needed to be implemented in order to gain assurance that the Corporation properly presents its financial statements and related footnotes, under generally accepted accounting principles of the United States (“GAAP”). To accomplish this task, the Corporation hired an independent consultant, experienced in complying with SOX-404, to assist management in completing the project and thereby enabling the chief executive officer and chief financial officer to certify whether or not there were any significant deficiencies or material weaknesses in the internal controls established to assure that the Corporation’s financial statements were prepared under GAAP.

KPMG LLP (“KPMG”), the Corporation’s Independent Registered Public Accounting Firm, has issued an attestation report that management’s assessment that the Corporation maintained effective internal control over financial reporting as of December 31, 2004 is fairly stated, in all material respects, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Also in their opinion, KPMG stated that the Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2004, based on COSO.

DISCONTINUED OPERATIONS

As a result of Corporation management’s decision to accomplish the JWR & Co Asset Sale, the Corporation had long-lived assets meeting the criterion of SFAS No. 144 for being classified as available for sale on its balance sheet. Therefore, the revenues and expenses, the write-down of goodwill and other related disposal expenses have been classified as a loss from discontinued operations, net of taxes in the respective statements of income. Following is a table outlining (1) the amounts of revenue, expenses and after-tax losses reported in the results from discontinued operations and (2) the non-recurring transactions’ impact, that are a result of the Asset Sale:

	For the twelve months ended
	2004		2003			2002
	(000) omitted
Revenues of JWR & Co.*	$	—	$	773		$	2,228
Expenses of JWR & Co.*		—		(1,091	)		(2,207	)
Pre-tax (loss) income		—		(318	)		21
Applicable income (tax) benefit		—		108			(7	)
(Loss) income		—		(210	)		14
Non-recurring transactions
Write-down of Goodwill		—		(1,005	)		(400	)
Accounts receivable charge-off		—		(148	)		—
Other		—		(245	)		(74	)
Income (tax ) benefit		—		(308	)**		25
Total of non-recurring transactions				(1,706	)		(449	)
Loss from discontinued operations	$	—	$	(1,916	)	$	(435	)

* Revenues and expenses of JWR & Co not specifically related to discontinued operations are excluded from the respective categories in this chart.

** Includes $444,000 of income tax expense on the sale of JWR & Co.’s assets.

5

While there was no (loss) income from discontinued operations in 2004, the Corporation reported net income of $9,345,000 for the twelve months ended December 31, 2004, an $11,000 decrease from $9,356,000 reported for the same period in 2003 which was an $851,000 or an 8% decrease from $10,207,000 reported in 2002. Basic earnings per common share on net income amounted to $1.09, a 1% increase from $1.08 reported for 2003, which was an 8% decrease from $1.17 reported in 2002. Diluted earnings per common share on net income were even at $1.06 for both 2004 and 2003, which was an 8% decrease from $1.15 reported in 2002.

While there was no (loss) income from discontinued operations for 2004, for both basic or diluted earnings per share, the basic and diluted loss per common share from discontinued operations amounted to $.22 for year end 2003, compared to a loss of $.05 for the same period in 2002. The loss per common share from discontinued operations assuming dilution also amounted to $.22 for 2003, compared to a loss of $.05 in 2002.

SELECTION OF NEW AUDITORS

On December 19, 2003 the Corporation retained KPMG LLP (“KPMG”) as its new independent registered public accounting firm to audit the financial statements for the fiscal year ended December 31, 2004. PricewaterhouseCoopers LLP (“PwC”) served as the independent registered public accounting firm for the fiscal year ended December 31, 2003. The decision to change independent registered public accounting firms was made by the Audit Committee of the Board of Directors of the Corporation.

During each of the fiscal years ended December 31, 2003 and 2002 and subsequent interim period through March 15, 2004, there were no disagreements between the Corporation and PwC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of PwC would have caused it to make reference to the subject matter of the disagreements in connection with its reports; and there were no “reportable events” as that term is defined in Item 304 (a)(1)(v) of Regulation S-K occurring within the Corporation’s two most recent fiscal years and the subsequent interim period through March 15, 2004.

The reports of PwC on the financial statement for the past two years contained no adverse opinions or disclaimer of opinion and were not qualified or modified as to their uncertainty, audit scope or accounting principle.

The Corporation provided PwC and KPMG with a copy of the foregoing disclosures regarding the change of independent registered public accounting firms pursuant to Item 304 of the SEC’s Regulation S-K giving them the opportunity to provide a statement for inclusion herein, if either of them disagrees with the accuracy or completeness of these disclosures. After their review, neither PwC nor KPMG expressed any disagreement with these disclosures. A copy of PWC’s letter response to such request was attached to the Corporation’s 8-K/A filed with the SEC on March 15, 2004.

RESULTS OF CONTINUING OPERATIONS

Overview

The Corporation reported a 17% decrease in income from continuing operations for 2004 to $9,345,000 from $11,272,000 for 2003.

Basic earnings per common share from continuing operations amounted to $1.09 in 2004, a 16% decrease from $1.30 for 2003. Diluted earnings per common share from continuing operations decreased by 17% to $1.06 for 2004 from $1.28 for 2003. The dilutive potential common shares added to the weighted-average shares outstanding were 170,545, 158,543 and 130,020 for 2004, 2003 and 2002, respectively.

The decline in earnings for 2004 was primarily due to a decrease in the origination and subsequent sale of residential mortgage loans in the Mortgage Banking segment, causing a decline in the respective gains on the sale of residential mortgage loans in 2004. As presented on Table 1 – Line of Business Segment Analysis, the Mortgage Banking segment’s profitability declined 71% or $4,232,000 to $1,756,000 for 2004, compared to $5,988,000 for 2003. The primary reason for this decline was a $7,751,000 decrease in net gains on the sale of loans, a direct result of declines in the level of residential mortgage loan refinancing activity in 2004, compared to 2003 and 2002. This decline in net gains on loan sales was partially offset by a $3,177,000 decrease in other operating expenses, due primarily to a decline in the amortization of MSRs, as well as expenses related to the Mortgage Banking business segment. Partially offsetting the decline in the Mortgage Banking segment’s profitability was a 5% or $404,000 increase in the Banking segment’s profitability. Short term interest rates began rising in the second half of 2004, which was beneficial to the Bank’s net interest income in the final two quarters of 2004, compared to 2003. However, this increase in short term interest rates in 2004 was not sufficient to increase the Bank’s net interest margin ahead of 2003. The net interest margin decreased 24 basis points in 2004, compared to 2003. However, a 14% increase in average outstanding earning assets in 2004, compared to 2003, offset the decreased net interest margin and is primarily responsible for the Banking segment’s net interest income increasing 7% over 2003 levels. The Banking segment also reported net gains on the sale of mortgage servicing rights of $1,145,000. No such sales were reported for 2003 or 2002. Due to larger net charge-offs in the second half of 2004, the loan loss provision was increased by $150,000 to $900,000. The Banking segment also incurred expenses related to the requirements of SOX-404. Accounting and consulting expenses for SOX-404 amounted to $470,000 for 2004. No such expenses were incurred in 2003 or 2002.

6

A 6% increase in fees for investment management and trust services, combined with holding the wealth management expenses to 3% growth, are primarily responsible for a 12% increase in Wealth Management segment profits for 2004, compared to 2003.

Return on average assets (“ROA”) for the year was 1.45%, compared to 1.98% in 2003, while return on average equity (“ROE”) for 2004 was 13.67% compared to 17.76% in 2003.

EARNINGS PERFORMANCE

Lines of Business

The Corporation continues to have four significant business segments or lines from which it derives its earnings, one of which is the Banking line of business. Additional earnings streams are obtained from its Wealth Management line of business and its Mortgage Banking line of business - the origination, servicing and sale of mortgage loans to the secondary mortgage market. The fourth segment, included in “All Other” in the following segmentation analysis, derives net revenues from insurance services and products, offered through the Bank’s subsidiary, ICBM and interest income on notes in JWR & Co.

Following is a segmentation analysis of the results of operations for those lines of business for 2004 and 2003:

TABLE 1 - Line of Business Segment Analysis

	2004
(dollars in thousands)	Banking			Wealth Management			Mortgage Banking**			All Other*			Consolidated
Net interest income	$	26,487		$	—		$	255		$	86		$	26,828
Less loan loss provision		900			—			—			—			900
Net interest income after loan loss provision		25,587			—			255			86			25,928
Other income:
Fees for investment management and trust services		—			10,087			—			—			10,087
Service charges on deposit accounts		1,827			—			—			—			1,827
Other fees and service charges		209			—			1,670			—			1,879
Net gain on sale of loans		34			—			2,886			—			2,920
Net gain on sale of mortgage servicing rights		1,145						—						1,145
Other operating income		1,547			—			112			667			2,326
Total other income		4,762			10,087			4,668			667			20,184
Other expenses:
Salaries-regular		8,789			3,674			904			200			13,567
Salaries-other		942			322			171			11			1,446
Fringe benefits		3,260			820			165			52			4,297
Occupancy		3,246			572			249			131			4,198
Other operating expenses		5,343			1,046			1,678			440			8,507
Total other expenses		21,580			6,434			3,167			834			32,015
Segment profit (loss)	$	8,769		$	3,653		$	1,756		$	(81	)	$	14,097
% of segment profit (loss)		62	%		26	%		13	%		(1	)%		100	%

	2003***
(dollars in thousands)	Banking			Wealth Management			Mortgage Banking**			All Other*			Consolidated
Net interest income	$	24,707		$	—		$	160		$	64		$	24,931
Loan loss provision		750			—			—			—			750
Net interest income after loan loss provision		23,957			—			160			64			24,181
Other income:
Fees for investment management and trust services		—			9,484			—			—			9,484
Service charges on deposit accounts		1,896			—			—			—			1,896
Other fees and service charges		199			—			2,221			—			2,420
Net gain on sale of loans		13			—			10,637			—			10,650
Other operating income		1,496			—			454			637			2,587
Total other income		3,604			9,484			13,312			637			27,037
Other expenses:
Salaries-regular		8,274			3,665			1,343			314			13,596
Salaries-other		479			113			833			13			1,438
Fringe benefits		3,267			839			195			52			4,353
Occupancy		2,994			617			258			216			4,085
Other operating expenses		4,182			1,002			4,855			386			10,425
Total other expenses		19,196			6,236			7,484			981			33,897
Segment profit (loss)	$	8,365		$	3,248		$	5,988		$	(280	)	$	17,321
% of segment profit (loss)		48	%		19	%		35	%		(2	)%		100	%

* Bryn Mawr Bank Corporation, Insurance Counsellors of Bryn Mawr, Inc., and Joseph W. Roskos & Co. have all been aggregated in All Other.

** BMT Mortgage Company, a division of the Bank and BMT Settlement Services, Inc. have been aggregated in Mortgage Banking.

*** Reclassified for comparative purposes.

The table reflects operating profits or losses of each corporate line of business before income taxes and excluding inter-company interest income and expense, related to inter-company borrowings and excludes loss from discontinued operations.

The Banking segment’s percentage of operating profits stood at 62% for 2004, compared to 48% for 2003. The Wealth Management segment’s percentage of operating profit was 26%, up from 19% for 2003. The Mortgage Banking segment’s share of operating profits decreased from 35% in 2003 to 13% in 2004, while the “All Other” segment, including the Corporation and all non-banking subsidiaries, went from (2%) in 2003 to (1%) in 2004.

Banking Line of Business

The Bank’s average outstanding earning assets for 2004 of $587,150,000 increased 14% from $516,358,000 for 2003. Average outstanding loans also grew by 13% in 2004. The largest dollar increase in average outstanding loans occurred in the consumer line of credit loans, up $30,740,000 or 43% over 2003 average balances. Average commercial mortgage loan balances grew by $17,622,000 or 16%, compared to 2003 levels and, average construction loan balances increased $2,835,000 or 9% in 2004, compared to the same period in 2003. Due to some commercial loan prepayments in 2004, average commercial loan balances remained level with 2003, decreasing $698,000 or less than 1%, compared to similar average outstanding balances in 2003.

Reflecting the Bank’s strategy to hold some shorter term residential mortgage loans in its loan portfolio, the average

7

balance of residential mortgage loans increased $15,827,000 or 25% from 2003 average balances. The average outstanding balances of the Bank’s consumer small business loan product increased by $6,263,000 or 50% from 2003’s average outstanding balances. This growth is attributed to the superior package of small business services designed to provide small business customers with high quality, competitively-priced loan, deposit and investment services. The average balance of the consumer loan portfolio decreased by $13,031,000 or 62%. This reflects the planned run-off of the Bank’s indirect automobile dealer paper portfolio, as well as a decline in fixed rate home equity loan balances.

The average outstanding balances of federal funds sold increased by $2,414,000 or 23% in 2004 compared to 2003 levels. Average outstanding investments increased by $8,658,000 or 37% for 2004 compared to 2003.

Average outstanding total deposits increased $67,700,000 or 14% in 2004 compared to 2003. The largest dollar increase occurred in the Bank’s money market account average balances. The Bank increased its money market account interest rate structure, making the interest rates competitive with interest rates paid on off-balance sheet money market sweep accounts. This competitive rate structure offered by the Bank resulted in the movement of off-balance sheet sweep balances, as well as other money market mutual funds, into the Bank’s money market accounts. The money market account balances grew by $37,668,000 or 44% over 2003 average balances. Average outstanding NOW account balances increased by $21,130,000 or 17%, while average non-interest bearing demand deposit account balances increased by $2,001,000 or 2%. Average outstanding savings accounts increased 3% or $1,527,000, while the average balances of certificates of deposit (“CDs”) grew by $5,373,000 or 6%. As a result of the strong growth in the Bank’s average deposit base in 2004 the Bank was not reliant on short-term borrowings, having average outstanding balances of short-term borrowings and federal funds purchased of $850,000, compared to $496,000 for 2003. The increases in the average balances of lower costing money market accounts, NOW account and non-interest bearing demand deposit accounts are the primary reasons for the cost of funds decreasing 10 basis points. However, a continued low prime rate for much of 2004, partially offset by increases in earning assets, is primarily responsible for a decrease in the net interest margin to 4.46% in 2004 from 4.70% for 2003. An expanded discussion of the Bank’s net interest income follows in the section below entitled “Net Interest Income.”

Total other income from the Banking segment increased by 32% in 2004 compared to 2003. The Bank sold MSRs associated with the servicing of $245 million of residential mortgage loans serviced for others. This sale generated a net gain on the sale of $1,145,000. There was no such sale or gain in 2003. Exclusive of this gain, total other income increased less than 1%. The largest increase in other income was on other operating income, up $51,000 or 3%, due primarily to increases in sweep fees. Service charges on deposit accounts decreased $69,000 or 4%.

Total other expenses of the Banking business segment increased by 12% in 2004 compared to 2003 levels. While regular salaries increased by 6%, other salaries, primarily incentives and a corporate-wide bonus pool of $275,000 increased by $463,000 or 97%, compared to similar corporate-wide incentives incurred in 2003. A corporate-wide bonus pool of $275,000 was accrued for 2004. No such bonus pool was accrued in 2003. Fringe benefits remained level with 2003. Occupancy expenses increased by $252,000 or 8%, due primarily to expenses related to the new Newtown Square branch, put into service in January 2004. Other operating expenses increased by 28% which included a decrease in advertising expenses of 35%. The increase in other operating expenses in 2004 was mainly due to accounting and consulting expenses related to implementing the requirements of SOX-404 of $470,000. No such expenses were incurred in 2003. Included in other operating expense in 2003 was a $250,000 elimination of a prior accrual for potential litigation that was deemed unnecessary as of December 31, 2003. Exclusive of the above mentioned items, other operating expenses increased by 10% over 2003.

Strong growth in the Bank’s average earning assets, over 2003, is primarily responsible for a $1,780,000 or 7% increase in net interest income. The Bank also increased its loan loss provision by $150,000. The result was a $404,000 or 5% increase in the Banking segment profit for 2004, over 2003.

Wealth Management Line of Business

The Wealth Management business segment reported a 12% increase in operating profit for 2004 compared to 2003 levels. A $603,000 or 6% increase in fees for investment management and trust services is primarily responsible for this increase. An overall increase in asset values combined with the growth in new business was the primary cause for the increase in trust fees. The market value of assets managed increased by 11% from $1,752,000,000 at December 31, 2003, to $1,938,000,000 as of December 31, 2004.

Total other expenses of the Wealth Management line of business increased by $198,000 or 3% in 2004 over 2003 levels.

The primary reason for this increase was an increase in the salary - other expense of $209,000 or 185%, due primarily to increased incentive payments in 2004 related to the growth in new business, compared to 2003. Occupancy expenses declined $45,000 or 7% and other operating expenses increased by $44,000 or 4%.

Mortgage Banking Line of Business

The operating profit of the Bank’s Mortgage Banking line of business decreased 71% in 2004 compared to 2003 due to a significant decline in the volume of residential refinancing

8

activity in 2004 compared to 2003. The sale of residential mortgage loans decreased by 77% and the respective gains declined by 73% or $7,751,000. Other fees and service charges decreased 25% primarily due to decreased fees associated with the decline in residential mortgage originations, as well as a decline in loan servicing fees caused by the sale of MSRs in the first quarter of 2004. Other operating income, consisting of fees earned by BMTSS, decreased 75%. This decrease is directly related to the 77% decrease in the sale of residential loans in 2004, compared to 2003.

Regular salaries declined 33% due to a decrease in overtime, as well as not replacing three Mortgage Banking segment officers, who resigned in the first quarter of 2004. Salaries – other decreased 79% due to lower incentives related to the lower volume of respective loan sales. Fringe benefits declined 15%, related to lower salary expense in 2004, while other operating expenses decreased 65%. Of this decrease $1,975,000 was due to lower amortization of MSRs, due to the decline in refinancing activity previously discussed, and other expenses, directly related to the volume of loan sales, such as appraisal fees, loan pair off fees and credit reports, decreased by $1,228,000. The total decrease in other operating expense amounted to $3,177,000.

Following is a table showing the volume of residential mortgage loans originated and sold to the secondary mortgage market, the total net gains realized, and the yield on these loan sales:

TABLE 2: Summary of Residential Loan Sale Activity

(dollars in thousands)	2004			2003
Volume of loans sold	$	144,916		$	628,052
Loan fees and net gains on sales		2,886			10,637
Yield on sales		1.99	%		1.69	%

As of December 31, 2004, the Bank serviced $480,494,000 in residential mortgage loans for others, compared to $755,132,000 in loans serviced for others at year-end 2003. This decrease reflects the sale of MSRs in 2004 associated with $245,000,000 in residential mortgage loans serviced for others.

Bryn Mawr Bank Corporation

The Corporation is a one-bank holding company, generating intercompany revenues from the rental of Corporation owned properties to the Bank. The Corporation’s expenses are primarily of an administrative nature.

Insurance Counsellors of Bryn Mawr, Inc.

In January 1998, the Bank established a wholly owned subsidiary, ICBM (a full-service insurance agency), to enable the Bank to offer insurance products and related services to its customer base. ICBM offers a full line of life, property and casualty and commercial lines to its customer base. ICBM reported net income of $44,000 for 2004, compared to a loss of $28,000 in 2003. While insurance commissions grew by $26,000 or 6%, expenses decreased by $90,000 or 20%. This decrease is primarily related to the elimination of one senior position in ICBM at year-end 2003.

BMT Settlement Services, Inc.

In January 2002, the Bank formed BMTSS, a Pennsylvania Corporation, to be a limited partner in a limited partnership, established to provide title search and abstract services to Bank customers either refinancing their existing residential mortgage loans or obtaining new residential mortgage loans. BMTSS entered into an agreement (the “Partnership Agreement”) with Commonwealth Land Transfer Company, whereby BMTSS would receive 70% of the profits, after expenses, from the partnership. Due to the significant decrease in the volume of mortgage loan refinancing in 2004, compared to 2003, as described in the Mortgage Banking segment, BMTSS earned $82,000 in net income for 2004, a 68% decrease from $258,000 reported for 2003.

Joseph W. Roskos & Co.

On August 1, 2003, effective June 30, 2003, the Corporation concluded the Asset Sale and, as a result of that transaction, JWR & Co. took back notes from PFO, the purchaser. Income from continuing operations for 2004, representing the interest on the notes totaling $1,287,000 at December 31, 2004 was $81,000 compared to $47,000 for 2003.

Net Interest Income

During 2003 and for the first seven months of 2004, the Bank’s prime rate remained at 4.25%. From August to December 2004, the bank increased its prime rate by 100 basis points, ending 2004 at 5.25%. The continued low prime rate for much of 2004 and all of 2003, compared to 2002, reduced the Bank’s net interest margin. In 2004, the compressed net interest margin was offset by a 14% increase in average outstanding earning assets and resulted in a $2,120,000 or 7% increase in total interest income. Strong growth in the Bank’s low cost deposits, partially offset by a decline in interest rates paid on deposits during 2004, compared to 2003 deposit rates, was primarily responsible for a $223,000 or 5% increase in total interest expense for the year ended December 31, 2004. This resulted in net interest income for 2004 of $26,828,000 being 8% ahead of $24,931,000 in net interest income reported for 2003. In an effort to increase interest income the Bank grew the investment portfolios, average outstanding investments balances by 37%. This growth, being partially offset by a 50 basis point decrease in the yield on investments, is primarily responsible for an 18% increase in interest on investments. Primarily the result of strong average deposit growth in 2004, average outstanding balances of federal funds sold increased by 23%. The yield on earning assets decreased by 40 basis points, from 5.7% for 2003 to 5.3% for 2004.

Total average deposits increased 14%. The largest increases occurred in the Bank’s lower costing deposits. The largest dollar increase occurred in the Bank’s money market account average balances, up $37,668,000 or 44%. This is due to the

9

change in the pricing of the money market account to be more competitive which resulted in the movement of off-balance sheet sweep funds back into the Bank’s money market accounts and funds from other money market mutual funds being deposited. Average NOW account balances increased by $21,130,000 or 17%. Average non-interest-bearing demand deposits increased by $2,001,000 or 1%. Statement savings average balances grew by $1,527,000 or 3% and CD balances grew by $5,373,000 or 6%. Average outstanding short-term borrowings and federal funds purchased were less than $1,000,000 for each period, increasing by 71% from $496,000 for 2003 to $850,000 for 2004. The low levels of borrowings are due primarily to the increased liquidity provided by the growth in average deposits in both 2004 and 2003. A combination of the ability to lower overall interest rates paid for interest-bearing deposits and short-term borrowings and strong growth in the low and no cost deposit balances was primarily responsible for a 10 basis point decrease in the average cost of funds for 2004, compared to 2003. The decrease in the yield on earning assets, partially offset by the decreased cost of funds was directly responsible for the Bank’s net interest margin, defined as net interest income, inclusive of loan fees, as a percentage of average earning assets, decreasing from 4.70% for 2003 to 4.46% for 2004.

TABLE 3 - Analyses of Interest Rates and Interest Differential

The following table shows an analysis of the composition of net interest income for each of the last three years. Interest income on loans includes fees on loans of $645,000, $677,000 and $620,000 in 2004, 2003 and 2002 respectively. The average loan balances include nonaccrual loans. All average balances are calculated on a daily basis. Yields on investment securities are not calculated on a tax-equivalent basis.

	2004							2003**							2002
(dollars in thousands)	Average Balance			Interest Income/ Expense		Average Rates Earned/Paid		Average/ Balance			Interest Income/ Expense		Average Rates Earned/ Paid		Average Balance			Interest Income/ Expense		Average Rates Earned/ Paid
Assets:
Cash and due from banks	$	32,774		$	—	—	%	$	33,005		$	—	—	%	$	29,934		$	—	—	%
Interest-bearing deposits with other banks*		3,079			48	1.6			3,737			37	1.0			3,651			54	1.5
Federal funds sold*		13,052			191	1.5			10,638			110	1.0			7,275			112	1.5
Investment securities available for sale:
Taxable*		27,173			854	3.1			21,087			780	3.7			21,373			1,024	4.8
Tax-exempt*		5,071			165	3.3			2,499			86	3.4			939			39	4.2
Total investment securities		32,244			1,019	3.2			23,586			866	3.7			22,312			1,063	4.8
Loans*		538,775			30,123	5.6			478,397			28,248	5.9			421,904			28,183	6.7
Less allowance for loan losses		(6,957	)		—	—			(6,519	)		—	—			(5,459	)		—	—
Net loans		531,818			30,123	5.7			471,878			28,248	6.0			416,445			28,183	6.8
Other assets		29,827			—	—			27,557			—	—			27,365			—	—
Total assets	$	642,794		$	31,381	—		$	570,401		$	29,261	—		$	506,982		$	29,412	—
Liabilities:
Demand deposits, noninterest-bearing	$	137,336		$	—	—	%	$	135,335		$	—	—	%	$	117,949		$	—	—	%
Savings deposits		323,972			1,999	0.6			263,646			1,658	0.6			221,725			1,556	0.7
Time deposits		102,369			2,544	2.5			96,996			2,664	2.7			79,332			2,509	3.2
Short term borrowings		96			1	1.0			438			7	1.6			18,609			386	2.1
Federal funds purchased		754			9	1.2			58			1	1.7			1,665			33	2.0
Other liabilities		9,900			—	—			10,454			—	—			8,551			—	—
Total liabilities		574,427			4,553	—			506,927			4,330	—			447,831			4,484	—
Shareholders’ equity		68,367			—	—			63,474			—	—			59,151			—	—
Total liabilities and shareholders’ equity	$	642,794		$	4,553	—		$	570,401		$	4,330	—		$	506,982		$	4,484	—
Total earning assets	$	587,150			—	—		$	516,358			—	—		$	455,142			—	—
Interest income to earning assets		—			—	5.3			—			—	5.7			—			—	6.5
Interest expense to earning assets		—			—	0.8			—			—	0.8			—			—	1.0
Net yield on interest-earning assets		—			—	4.5			—			—	4.9			—			—	5.5
Average effective rate paid on interest-bearing liabilities		—			—	1.1			—			—	1.2			—			—	1.4
Average effective cost on total deposits and short term borrowings		—			—	0.8			—			—	0.9			—			—	1.0
Net interest margin		—			—	4.46			—			—	4.70			—			—	5.34
Earning assets to interest-bearing liabilities		—			—	1.37			—			—	1.43			—			—	1.42

* Indicates earning assets.

** Reclassified for comparative purposes.

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TABLE 4 - Rate/Volume Analyses

The following table shows the effect of changes in volumes and rates on interest income and interest expense. Variances which were not specifically attributable to volume or rate were allocated proportionately between volume and rate. Interest income on loans included (decreases) increases in fees on loans of ($32,000) in 2004, $57,000 in 2003, and $46,000 in 2002.

(in thousands) Increase/(decrease)	2004 vs. 2003									2003 vs. 2002
	Volume			Rate			Total			Volume			Rate			Total
Interest Income:
Interest-bearing deposits with other banks	$	(8	)	$	19		$	11		$	1		$	(18	)	$	(17	)
Federal funds sold		25			56			81			41			(43	)		(2	)
Investment securities available for sale:
Taxable		209			(135	)		74			(13	)		(268	)		(281	)
Tax-exempt		82			(3	)		79			56			(9	)		47
Loans		3,383			(1,508	)*		1,875			3,622			(3,520	)*		102
Total interest income		3,691			(1,571	)		2,120			3,707			(3,858	)		(151	)
Interest expense:
Savings deposits		341			0			341			311			(209	)		102
Time deposits		115			(235	)		(120	)		557			(402	)		155
Short term borrowings		(4	)		(2	)		(6	)		(305	)		(74	)		(379	)
Fed funds purchased		8			(0	)		8			(28	)		(4	)		(32	)
Total interest expense		460			(237	)		223			535			(689	)		(154	)
Interest differential	$	3,231		$	(1,334	)	$	1,897		$	3,172		$	(3,169	)	$	3

* Included in the loan rate variance was a (decrease) increase in interest income related to non-performing loans of $(61,000) and $(10,000) in 2004 and 2003, respectively. The variances due to rate include the effect of nonaccrual loans because no interest is earned on such loans.

The 7% increase in interest income for 2004 was primarily attributable to a 14% increase in average earning assets, partially offset by a 40 basis point decline in the average yield on earning assets, from 5.7% in 2003 to 5.3% for 2004. Interest income related to the rate variance decreased by $1,571,000. A $3,691,000 increase in interest income, attributable to volume growth, was the result of a 14% increase in average outstanding earning assets, including a 13% increase in average outstanding loans. The average yield on loans decreased 30 Basis points from 5.9% in 2003 to 5.6% in 2004. The average yield on federal funds sold increased 50 basis points to 1.5% for 2004, compared to 1.0% for 2003. The yield on the investment portfolio decreased by 50 basis points from 3.7% in 2003 to 3.2% in 2004, as higher yielding maturing or called investments were replaced by investments at lower market interest rates.

While an increase in interest expense due mainly to increased average deposits caused an increase in interest expense of $460,000, the payment of lower rates on deposits caused a decrease in interest expense of $237,000. The net result was an increase in interest expense of $223,000. Because of declining average yields on both the loan and investment portfolios, as indicated in Table 4 – Rate/Volume Analyses on page 12 of this Report, net interest income, related to interest rates, decreased by $1,335,000 from 2003 to 2004. However, continued growth in earning assets, primarily in the loan portfolio, was responsible for a $3,232,000 increase in net interest income, offsetting the decline in the rate variance and increasing net interest income by $1,897,000 or 8% over 2003.

As of December 31, 2004, average outstanding loan balances increased 13% over December 31, 2003. The largest increase in average loans occurred in the consumer lines of credit, up $30,740,000 or 43%, as borrowers took advantage of lower interest rates associated with the floating rate home equity credit lines. Average outstanding commercial mortgage loans increased by $17,622,000 or 16%. In response to a strategy to hold some of the shorter-term residential mortgage loans, primarily 7-year and 15-year maturity loans, in the Bank’s loan portfolio, compared to selling them as done in prior periods, average outstanding residential mortgage loans increased by $15,827,000, or 25%. Average outstanding small business loans, a new loan product recently established by the Bank, increased by $5,963,000 or 46% over 2003 average outstanding balances. Average outstanding construction loan balances increased by $2,835,000 or 9%. Due primarily to unanticipated pay downs during 2004, average outstanding commercial and industrial loans remained flat, decreasing by $698,000 or less than 1%. A $13,031,000 or 62% decrease in outstanding consumer loans is due primarily to continued run-off of indirect automobile loans, which was planned by the Bank, as well as repayments by fixed rate home equity loan borrowers. The yield on average earning assets decreased by 40 basis points from 5.7% in 2003 to 5.3% in 2004.

Average outstanding deposits increased $67,700,000 or 14% during 2004. The majority of this growth occurred in average outstanding money market accounts, and NOW accounts increased $37,668,000 or 44% and $21,130,000 or 17%, respectively. The growth in money market accounts is due to the competitive pricing of these accounts. Average outstanding CD balances increased by $5,373,000 or 6%. Average outstanding non-interest-bearing demand deposits were up by $2,001,000 or 2%, while average outstanding savings account balances grew by $1,527,000 or 3%. Average outstanding short-term borrowings and federal funds purchased increased by $354,000 or 71%, with average outstanding balances remaining under $1,000,000 for both 2004 and 2003. The total cost of funds for the Bank averaged .8% for 2004 compared to .9% for 2003, a 10 basis point decrease.

Loan Loss Provision

Primarily in response to increased charge-offs in the second half of 2004, the Bank increased its annual loan loss provision from $750,000 for 2003 to $900,000 for 2004. The allowance for loan losses was $6,927,000 and $6,670,000 as of December 31, 2004 and 2003, respectively. Delinquencies, as a percentage of outstanding loans, amounted to 41 basis points and 27 basis points as of December 31, 2004 and 2003, respectively. Nonperforming loans amounted to $1,109,000 at December 31, 2004, compared to $286,000 at December 31, 2003. The allowance for loan losses, as a percentage of outstanding loans, was 1.23% as of December 31, 2004, compared to 1.33% as of December 31, 2003. Bank management has determined that the 2004 loan loss provision

11

was sufficient to maintain an adequate level of the allowance for loan losses during 2004.

TABLE 5 - Allowance for Loan Losses

A summary of the changes in the allowance for loan losses and a breakdown of loan loss experience by major loan category for each of the past five years follows:

	December 31,
(dollars in thousands)	2004			2003			2002			2001			2000
Allowance for loan losses:
Balance, January 1	$	6,670		$	6,114		$	4,928		$	4,320		$	4,400
Charge-offs:
Commercial and industrial		(167	)		(112	)		—			(940	)		0
Real estate—construction		—			—			—			—			—
Real estate—mortgage		(431	)		(13	)		—			(51	)		(44	)
Consumer		(94	)		(102	)		(68	)		(178	)		(355	)
Total charge-off		(692	)		(227	)		(68	)		(1169	)		(399	)
Recoveries:
Commercial and industrial		2			—			220			63			3
Real estate—construction		—			—			—			476			—
Real estate—mortgage		—			1			10			—			—
Consumer		47			32			24			38			66
Total recoveries		49			33			254			577			69
Net recoveries / (charge-offs)		(643	)		(194	)		186			(592	)		(330	)
Provision for loan losses		900			750			1,000			1,200			250
Balance, December 31	$	6,927		$	6,670		$	6,114		$	4,928		$	4,320
Net recoveries / (charge-offs) to average loans		(0.12	)%		(0.04	)%		0.04	%		(0.16	)%		(0.10	)%

TABLE 6 - Allocation of Allowance for Loan Losses

The table below allocates the balance of the allowance for loan losses by loan category and the corresponding percentage of loans to total loans for each loan category for the last five years:

	December 31,
	2004				2003				2002				2001				2001
(dollars in thousands)	% Loans to Total Loans				% Loans to Total Loans				% Loans to Total Loans				% Loans to Total Loans				% Loans to Total Loans
Balance at end of period applicable to:
Commercial and industrial	$	3,575	33.1	%	$	3,656	35.7	%	$	2,940	36.4	%	$	2,729	39.1	%	$	1,193	41.5	%
Real estate—construction		741	6.6			558	7.2			494	5.9			214	5.1			7	3.0
Real estate—mortgage		806	58.5			1,089	53.4			1,107	52.4			1,019	45.0			56	38.3
Consumer		1,174	1.8			906	3.7			907	5.3			316	10.8			248	17.2
Unallocated		631	—			461	—			666	—			650	—			2,816	—
Total	$	6,927	100	%	$	6,670	100	%	$	6,114	100	%	$	4,928	100	%	$	4,320	100	%

The loan loss reserve allocation reflects a reserve based on specific loan loss reserve allocations on loans reviewed individually as well as an average historical loan write-off percentage for loans in each specific loan category not individually reviewed and is also adjusted by an additional percentage to reflect current market conditions.

Refer to pages 30 - 31 for further discussion of the Corporation’s loan review process.

12

Other Real Estate Owned

During 2004 the Bank obtained a property in foreclosure, adding $357,000 in Other Real Estate Owned (“OREO”). There was no OREO recorded on the Bank’s books as of December 31, 2003.

Other Income

The following table details other income for the years ended December 31, 2004 and 2003, and the percent change from year to year:

TABLE 7 - Other Income

	2004		2003		% Change
Fees for investment management and trust services	$	10,087	$	9,484	6	%
Service charges on deposit accounts		1,827		1,896	(4	)%
Other fees and service charges		1,879		2,420	(22	)%
Net gain on sale of loans		2,920		10,650	(73	)%
Net gain on sale of mortgage servicing rights		1,145		—	100	%
Investment advisory and brokerage fees		216		248	(13	)%
Insurance commission income		299		268	12	%
Other operating income		1,421		1,611	(12	)%
Total other income	$	19,794	$	26,577	(26	)%

In addition to net interest income, the Bank’s three operating segments, as well as ICBM generate various streams of fee-based income, including investment management and trust income, insurance commissions, service charges on deposit accounts, loan servicing income and gains/losses on loan sales, and in 2004 a gain on the sale of MSRs.

Fees for investment management and trust services increased $603,000 or 6% from $9,484,000 in 2003 to $10,087,000 in 2004. Refer to the discussion under the heading “Wealth Management Line of Business” on page 8 of this Report.

Service charges on deposit accounts decreased $69,000 or 4%, from $1,896,000 in 2003 to $1,827,000 in 2004. Increased average outstanding deposit balances, partially offset by low earnings credit rates, which produce an earnings credit to offset service charges, were sufficient to produce this reduction in service charges on deposit accounts in 2004, compared to 2003.

Other fees and service charges decreased $541,000 or 22%, from $2,420,000 for 2003 to $1,879,000 for 2004. The primary reasons for this decrease was a reduction in residential refinancing activity, discussed in the Mortgage Banking segment, and the sale of MSRs in the first quarter of 2004. The MSR sale accounted for a $245,000,000 reduction in loans serviced for others, thereby lowering loan servicing fees in 2004, compared to similar fees earned in 2003.

As discussed in the “Mortgage Banking Line of Business” section, the $7,730,000 or 73% decrease in gains on the sale of residential mortgage loans was directly attributable to a $483,136,000 or 77% decrease in the volume of residential mortgage loans sold, compared to 2003.

Other operating income decreased $190,000 or 12%, from $1,611,000 for 2003, compared to $1,421,000 for 2004. Included in other operating income are fees earned by BMTSS, from its partnership with a title insurance company. These fees decreased by $342,000 or 75% from $454,000 for 2003, to $112,000 reported for 2004. The reduction in fees earned by BMTSS from year to year is directly attributable to the 77% decrease in the volume of residential loan sales, discussed previously. This decrease in BMTSS fees is the primary reason for the 12% decline in other operating income in 2004, compared to 2003. Partially offsetting this decrease in other operating income was a $40,000 reimbursement from a loan agreement in 2004, related to a prior year and an increase in rental income of $26,000 from a property leased by the Bank, as well as a $24,000 increase in sweep fees earned by the Bank. Brokerage fees decreased by $32,000 or 13%, while insurance commission income rose by $31,000 or 12%.

Other Expenses

The following table details other expenses for the years ended December 31, 2004 and 2003, and the percent change from year to year:

TABLE 8 - Other Expenses

	2004		2003*		% Change
Salaries-regular	$	13,567	$	13,596	0	%
Salaries-other		1,446		1,438	1	%
Employee benefits		4,297		4,353	(1	)%
Occupancy expense		2,161		1,961	10	%
Furniture, fixtures, and equipment		1,785		1,806	(1	)%
Advertising		879		674	30	%
Professional fees		1,799		937	92	%
Computer processing		587		607	(3	)%
Stationery and supplies		282		316	(11	)%
Insurance		151		156	(3	)%
Amortization of MSRs		839		2,814	(70	)%
Other operating expenses		3,832		4,779	(20	)%
Total other expenses	$	31,625	$	33,437	(5	)%

* Reclassified for comparative purposes.

Total other expenses decreased for the year ended December 31, 2004, by $1,812,000 or 5%. Regular salaries, consisting of regular, part time and overtime salary expense, the largest component of other expenses, decreased $29,000 or less than 1%. Staffing turnover and the Bank’s ability to replace necessary vacant positions from within the Bank are the primary reasons for regular salaries being even with 2003 levels not withstanding a 3% salary increase. As of December 31, 2004, the Corporation’s consolidated full-time equivalent staffing level was 237.5 compared to 247.5 as of December 31, 2003.

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Other salaries increased $8,000 or 1% from 2003 to 2004. Primarily reflecting the decrease in mortgage banking activity in the Mortgage Banking business segment, incentive-based salaries in the Bank’s credit division decreased $780,000 or 65%. Offsetting this decrease were increases in incentive based salaries incurred in the Wealth Management business segment, related to new business development, increasing $187,000 or 165%, the accrual of a corporate wide bonus pool of $275,000 for 2004, compared to no corporate wide bonus pool in 2003, a $77,000 incentive pool related to the sale of MSRs in 2004, compared to no such pool in 2003, and an overall increase in other incentives related to new business acquisition within the Bank of $130,000 or 41%. Also related to the decrease in residential mortgage loan sales was a $119,000 or 56% decrease compared to 2003 in the deferred expenses related to mortgage originations as required by GAAP. All of these changes in 2004 from 2003 accounted for $7,000 of the $8,000 net change in other salaries from year to year.

Employee benefit costs decreased $56,000 or 1% in 2004 from 2003 levels. There was a decrease of $181,000 in the expense associated with the Corporation’s pension plan, which produced an expense of $935,000 in 2004 compared to $1,116,000 in 2003. Increasing pension asset values are primarily responsible for this decrease in pension expenses. Partially offsetting this decrease was an increase in fringe benefits; other fringe benefits were up $98,000 or 22%, primarily driven by an increase in the Corporation’s postretirement benefits expense up $91,000 or 95% from 2003.

Occupancy expenses increased $200,000 or 10% from 2003. This is mainly related to the new branch office in Newtown Square, Pennsylvania, which opened during the first quarter of 2004. This expense did not exist in 2003.

Advertising expenses increased by $205,000 or 30%, due primarily to an increase in the cost of radio advertising. Professional fees increased by $862,000 or 92%. The largest increase was related to accounting and consulting fees incurred to comply with the requirements of SOX-404 of $220,000 and $250,000, respectively. Exclusive of the SOX-404 related expense, consulting expenses grew by $218,000 or 55%, due primarily to consulting expenses associated with enhancing the Corporation’s public image, as well as consulting fees paid to the retired CEO of ICBM for managing the Corporation’s insurance policies.

The amortization of MSRs decreased $1,975,000 or 70% from 2003 to 2004. This decrease is associated with the 77% decrease in the volume of residential refinancing activity and the sale MSRs discussed above in the Mortgage Banking segment.

Other operating expenses decreased $947,000 or 20% from $4,779,000 in 2003 to $3,832,000 in 2004. The decrease in residential mortgage loan sale activity in 2004 was primarily responsible for a $1,176,000 decrease in other operating expenses of the Mortgage Banking segment. Included in other operating expense in 2003 was a $250,000 elimination of a prior accrual for potential litigation that was deemed unnecessary as of December 31, 2003. The decreased Mortgage Banking segment related expenses in 2004 and the elimination of the $250,000 accrual reversal, effectively increasing expenses in 2004, accounts for $926,000 of the decrease in other operating expenses for 2004, compared to a total decrease of $947,000 in 2004, compared to 2003.

Income Taxes

The income taxes for 2004 were $4,752,000, compared to $6,049,000 for 2003. This represents an effective tax rate of 33.7% and 34.4% for 2004 and 2003, respectively. Income taxes for financial reporting purposes differ from the amount computed by applying the statutory rate to income before taxes, due primarily to tax-exempt income from certain loans and investment securities.

FINANCIAL CONDITION

Investment Securities

Management has elected to classify 100% of the investment portfolio as held for sale. Therefore, the investment portfolio was carried at its estimated market value of $35,441,000 and $31,397,000 as of December 31, 2004 and 2003, respectively. The amortized cost of the portfolio as of December 31, 2004 was $35,654,000, resulting in net unrealized losses of $213,000. The amortized cost of the portfolio at December 31, 2003 was $31,411,000, resulting in net unrealized losses of $14,000.

TABLE 9 - Investment Portfolio

(dollars in thousands)	Maturing during 2005			Maturing from 2006 through 2009			Maturing from 2010 through 2014			Maturing after 2014			Total
Obligations of the U.S.
Government and agencies:
Book value	$	3,475		$	21,351		$	3,967			—		$	28,793
Weighted average yield		2.4	%		3.1	%		3.5	%		—			3.3	%
State and political subdivisions:
Book value		—			—			5,098			—			5,098
Weighted average yield		—			—			3.2	%		—			3.2	%
Other investment securities:
Book value		54			—			306			1,190			1,550
Weighted average yield		—			—			—			—			—
Total book value	$	3,529		$	21,351		$	9,371		$	1,190		$	35,441
Weighted average yield		2.4	%		3.1	%		3.2	%		0.0	%		3.0	%

During 2004, $13,147,000 in investments were called and $204,000 of Federal Home Loan Bank of Pittsburgh (the “FHLB”) stock was redeemed. During 2004, purchases of investment securities amounted to $17,568,000. Those transactions were primarily responsible for the $4,044,000 or 13% increase in the investment portfolio from December 31, 2003, to December 31, 2004. At December 31, 2004, approximately 81% of the investment portfolio consisted of fixed rate U.S. Government Agency securities. The Corporation

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does not own any derivative investments and at the current time, does not plan to purchase any such investments in the foreseeable future.

Loans

For financial reporting purposes, both fixed and floating rate home equity loans, collateralized by mortgages, are included in other permanent mortgage loans. Floating rate personal lines of credit loans are included in consumer loans.

Table 10 - Loan Portfolio

A breakdown of the loan portfolio by major categories at December 31 for each of the last five years is as follows:

	December 31
(in thousands)	2004		2003		2002		2001		2000
Real estate loans:
Permanent mortgage loans	$	330,442	$	269,220	$	244,638	$	177,479	$	135,777
Construction loans		36,941		36,235		27,514		20,416		10,642
Commercial and industrial loans		186,923		178,381		170,286		167,452		147,398
Consumer loans		10,291		18,580		24,537		35,521		61,189
Total	$	564,597	$	502,416	$	466,975	$	400,868	$	355,006

The maturity distribution of the loan portfolio, excluding loans secured by one to four family residential property and consumer loans, at December 31, 2004, is shown below.

(in thousands)	Maturing during 2005		Maturing from 2006 through 2009		Maturing after 2009		Total
Commercial, financial, and agricultural	$	100,227	$	62,869	$	23,827	$	186,923
Real estate—construction		15,420		15,757		5,764		36,941
Real estate—other		710		19,368		117,063		137,141
Total	$	116,357	$	97,994	$	146,654	$	361,005
Interest sensitivity on the above loans:
Loans with predetermined rates	$	9,915	$	46,474	$	16,876	$	73,265
Loans with adjustable or floating rates		191,207		88,167		8,366		287,740
Total	$	201,122	$	134,641	$	25,242	$	361,005

There are no scheduled prepayments on the loans included in the maturity distributions.

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Table 11 - Loan Portfolio and Nonperforming Asset Analysis

	Loan Portfolio								Nonperforming Assets						Loan Loss Reserve
At December 31, 2004 (in thousands)	Current		Past Due 30 to 89 Days		Past Due 90 Days or More		Total Loans		Non- Performing Loans *		Other Real Estate Owned		Total Non- Performing Assets		Reserve for Loan Loss Allocation
Real estate loans:
Permanent mortgage loans:
Residential	$	81,725	$	984	$	1,080	$	83,789	$	1,080	$	357	$	1,437	$	204
Commercial		137,071		63		7		137,141		7		—		7		335
Home equity		109,482		24		6		109,512		6		—		6		267
Total permanent mortgage loans		328,278		1,071		1,093		330,442		1093		357		1450		806
Construction mortgage loans:
Residential		32,059		—		—		32,059		—		—		—		643
Commercial		4,882		—		—		4,882		—		—		—		98
Total construction mortgage loans		36,941		—		—		36,941		—		—		—		741
Total real estate loans		365,219		1,071		1,093		367,383		1093		357		1450		1,547
Commercial and industrial loans		186,844		79		—		186,923		—		—		—		3,575
Total commercial and industrial loans		186,844		79		—		186,923		—		—		—		3,575
Consumer loans:
Direct		888		19		—		907		—		—		—		103
Indirect		590		4		10		604		10		—		10		69
CreditLine		8,758		16		6		8,780		6		—		6		1,002
Total consumer loans		10,236		39		16		10,291		16		—		16		1,174
Unallocated reserve for loan loss		—		—		—		—		—		—		—		631
Total	$	562,299	$	1,189	$	1,109	$	564,597	$	1,109	$	357	$	1,466	$	6,927

* Nonperforming loans are loans on which scheduled principal and/or interest is past due 90 days or more and loans less than 90 days past due which are deemed to be problem loans by management. Total nonperforming loans of $1,109,000 includes the $1,109,000 in loans past due 90 days or more, on which certain borrowers have paid interest regularly. There are no loans less than 90 days delinquent included in nonperforming loans.

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The Bank’s lending function is its principal income generating activity, and it is the Bank’s policy to continue to serve the credit needs of its market area. Total loans at December 31, 2004 increased 12% to $564,597,000 from $502,416,000 as of December 31, 2003.

The largest growth in outstanding balances occurred in residential loans secured by real estate, which increased by $44,358,000 or 39%, from $114,677,000 at December 31, 2003 to $159,035,000 at December 31, 2004. In an effort to enhance current net interest income, the decision was made in the fourth quarter of 2003, to hold some shorter-term residential mortgage loans in the Bank’s loan portfolio. This is the primary reason for this increase in outstanding residential mortgage loans. Available for sale mortgage loans increased by $5,017,000 or 136%, from $3,691,000 at December 31, 2003 to $8,708,000 at year-end 2004.

Commercial mortgage loan balances increased by $17,293,000 or 14%, from $120,188,000 at December 31, 2003 to $137,481,000 as of December 31, 2004.

Second mortgage loans, originated as a function of the Mortgage Banking segment, decreased 18% or $5,542,000, from $31,203,000 at December 31, 2003 to $25,661,000 at year end 2004.

As of December 31, 2004, the construction loan portfolio increased by $706,000 or 2%, from $36,235,000 at December 31, 2003, to $36,941,000 at December 31, 2004. The construction lending function continues to maintain banking relationships with builders who are primarily located within the Bank’s marketing area. As of December 31, 2004 and 2003, the construction lending portfolio had neither any nonperforming loans nor any loans delinquent 30 days or more.

Commercial and industrial loan balances grew $8,542,000 or 5% from $178,381,000 at December 31, 2003 to $186,923,000 at December 31, 2004. This net increase is inclusive of early pay downs by two borrowers totaling $14,240,000 in commercial and industrial loan balances in 2004. Continued increased business development in the Bank’s commercial lending market area is the primary reason for this growth.

Consumer loans, consisting of loans to individuals for household, automobile, family, and other consumer needs, as well as purchased indirect automobile paper from automobile dealers in the Bank’s market area, decreased $8,289,000 or 45%, from $18,580,000 at December 31, 2003, to $10,291,000 at December 31, 2004. Continued pay downs of dealer automobile paper, as well as pay downs of fixed rate home equity loans are primarily responsible for this decrease.

Mortgage Servicing Rights

As a part of its sale of residential mortgage loans to the secondary market, for those loans sold with the loan servicing retained by the Bank, the Bank records MSRs as an asset. During 2004, the Bank has significantly decreased its residential mortgage origination and sale activity, thereby decreasing the balances of MSRs being recorded on its books. As of December 31, 2004, MSRs recorded on the Bank’s balance sheet amounted to $3,172,000, a 28% decrease from $4,391,000 in MSRs as of December 31, 2003. MSRs are recorded on the Bank’s balance sheet at values determined by reviewing the current value of MSRs in the mortgage servicing market. The current value of new MSRs being recorded, as loans are sold with servicing retained, is reviewed periodically and any adjustment to the initial basis point values being recorded is done in a timely manner. Partially because of the sale of MSRs for $245,000,000 in loans serviced for others in the first quarter of 2004 and a decline in the amount of new loans generated in 2004, compared to prior periods, the balance of residential mortgage loans serviced for others amounted to $480,494,000 and $755,132,000 as of December 31, 2004 and December 31, 2003, respectively.

Quarterly, the book value of the MSRs is tested for impairment by an independent valuation firm. Should any impairment occur, the MSR balances are written down against the Bank’s current income. In an increasing residential interest rate environment, prepayment speeds associated with related MSRs should slow, and prepayments of the MSRs will be less likely. However, in a lower residential mortgage loan interest rate environment, it is more likely that mortgage loans that were sold by the Bank with the servicing retained will be refinanced and the balance of the MSRs would be subject to accelerated amortization, thus reducing the Bank’s income. Should the Bank refinance the loans, the accelerated amortization of the MSRs may be offset by the recording of new MSRs, increasing the gain on the loans sold, thereby reducing or eliminating the negative effect of the accelerated amortization of the MSRs. Should the Bank not refinance or replace the loans being paid off, the Bank’s net income would be reduced to the extent of the aggregate accelerated amortization as the respective mortgage loans are paid off.

Deposits

The Bank attracts deposits from within its market area by offering various deposit instruments, including savings accounts, NOW accounts, money market accounts, certificates of deposit and non-interest bearing demand deposit accounts.

Total deposits increased 14% to $600,965,000 at December 31, 2004, from $527,139,000 at year-end 2003. Due primarily to continued strong deposit growth in 2003 and 2004, there were no short-term borrowings at either December 31, 2004 or 2003. A more meaningful measure of the change in deposits and short-term borrowings is average daily balances. As illustrated in Table 12, average daily deposit balances increased 14%. Strong growth in low costing money market and NOW account average balances, combined with the ability to lower overall interest rates paid for interest-bearing deposits and short-term borrowings was primarily responsible for a 10 basis point

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decrease in the average cost of funds for 2004, compared to 2003. The average cost of funds for 2004 was .8% compared to .9% for 2003.

The following table presents the average daily balances of deposits and the percentage change for the years indicated:

TABLE 12 - Average Daily Balances of Deposits

(dollars in thousands)	2004		2003		% Change 2004 vs. 2003		2002		% Change 2003 vs. 2002
Demand deposits, non- interest-bearing	$	137,336	$	135,335	1.5	%	$	117,949	14.7	%
Market rate accounts		123,651		85,984	43.8	%		61,105	40.7	%
NOW accounts		149,058		127,927	16.5	%		117,864	8.5	%
Regular savings		51,263		49,736	3.1	%		42,756	16.3	%
Savings deposits		323,972		263,647	22.9	%		221,725	18.9	%
Time deposits		102,369		96,996	5.5	%		79,332	22.3	%
Total	$	563,677	$	495,978	13.6	%	$	419,006	18.4	%

The following table shows the maturity of certificates of deposit of $100,000 or greater as of December 31, 2004:

TABLE 13 - Maturity of Certificates of Deposit of $100,000 or Greater

(in thousands)
Three months or less	$	19,546
Three to six months		5,344
Six to twelve months		9,026
Greater than twelve months		5,734
Total	$	39,650

Capital Adequacy

At December 31, 2004, total shareholders’ equity of the Corporation was $71,238,000, a $3,856,000 or 6% increase over $67,382,000 at December 31, 2003. Increasing the capital was the addition of earnings, after the payment of the dividends for the year, capital from the exercise of stock options, less shares repurchased in the Corporation’s stock repurchase program, offset by the reduced market value of the investment securities year to year. As of December 31, 2004, shareholders’ equity included accumulated other comprehensive loss on investment securities and the supplemental pension, net of deferred taxes, of $288,000 compared to accumulated other comprehensive loss on investment securities and the supplemental pension, net of deferred taxes, of $126,000 at December 31, 2003. This change caused a $162,000 decrease to shareholders’ equity from December 31, 2003 to December 31, 2004.

The Corporation and the Bank are required to meet certain regulatory capital adequacy guidelines. Under these guidelines risk-based capital ratios measure capital as a percentage of risk-adjusted assets. Risk-adjusted assets are determined by assigning various weights to all assets and off-balance sheet arrangements, such as letters of credit and loan commitments, based on the associated risk.

The Bank’s risk-based capital ratios at December 31, 2004 and 2003 are listed below. These ratios are all in excess of the minimum required capital ratios, also listed below.

TABLE 14 - Risk-Based Capital Ratios

	2004				2003
	Actual		Minimum Required		Actual		Minimum Required
Tier I capital ratio	9.99	%	4.00	%	10.12	%	4.00	%
Total capital ratio	11.09		8.00		11.30		8.00

The FDIC has created a statutory framework for capital requirements that established five categories of capital strength, ranging from a high of “well-capitalized” to a low of “critically under capitalized”. As of December 31, 2004 and 2003, the Bank exceeded the levels required to meet the definition of a “well-capitalized” bank. Management anticipates that the Corporation and the Bank will continue to be in compliance with all capital requirements and continue to be classified as “well-capitalized.”

The Corporation’s ability to declare dividends in the future is dependent on future earnings.

Risk Elements

Risk elements, as defined by the Securities and Exchange Commission in its Exchange Act Industry Guide 3, Statistical Disclosures by Bank Holding Companies, are composed of four specific categories: (1) nonaccrual, past due, and restructured loans, (2) problem loans, loans not included in the first category, but where information known by Bank management indicates that the borrower may not be able to comply with present payment terms, (3) foreign loans outstanding, and (4) loan concentrations. Table 11 presents a summary, by loan type, of the Bank’s nonaccrual and past due loans as of December 31, 2004. It is the Bank’s policy to promptly place nonperforming loans on nonaccrual status. Bank management knows of no outstanding loans that presently would meet the criteria for inclusion in the problem loan category, as indicated under specific category (2) referred to above. The Bank has no foreign loans, and loan concentrations are presented in Table 6 – Allocation of Allowance for Loan Losses. Table 6 presents the percentage of outstanding loans, by loan type, compared to total loans outstanding as of December 31, 2004.

Asset Quality

The Bank is committed to maintaining and developing quality assets. Loan growth is generated primarily within the Bank’s market area, which includes Montgomery, Delaware, Chester and Philadelphia Counties in Pennsylvania. Loan and deposit growth is also generated in portions of Bucks County in Pennsylvania. The development of quality loan growth is controlled through a uniform lending policy that defines the lending functions and goals, loan approval process, lending limits, and loan review.

Nonperforming loans were $1,109,000 at December 31, 2004, a 297% increase from $279,000 at December 31, 2003. This

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increase is primarily the result of one large residential mortgage loan that moved to non-performing status. The Bank had $357,000 in OREO balances as of December 31, 2004. There were no OREO properties on the Bank’s books as of December 31, 2003.

TABLE 15 - Nonperforming Assets

	December 31
(in thousands)	2004		2003		2002		2001		2000
Loans past due 90 days or more not on nonaccrual status:
Real estate—mortgage	$	6	$	15	$	19	$	15	$	18
Consumer		16		40		26		28		63
Loans on which the accrual of interest has been discontinued:
Commercial and industrial		—		—		—		—		—
Real estate—mortgage		1,087		205		—		—		—
Real estate—construction		—		19		—		—		—
Total nonperforming loans		1,109		279		45		43		81
Other real estate owned and in-substance foreclosed properties *		357		—		—		—		—
Total nonperforming assets	$	1,466	$	279	$	45	$	43	$	81

All loans past due 90 days or more, except consumer loans and home equity mortgage loans, are placed on nonaccrual status and any accrued interest income is reversed from current interest income. Such factors as the type and size of the loan, the quality of the collateral, and historical creditworthiness of the borrower and/or guarantors are considered by management in assessing the collectibility of such loans. Interest foregone on nonaccrual status loans was $88,000 for the year ended December 31, 2004. Interest earned and included in interest income on these loans prior to their nonperforming status amounted to $44,000 in 2004.

* Refer to Note 2 to the consolidated financial statements.

The Bank maintains a Loan Review Committee (the “Committee”) that periodically reviews the status of all non-accrual, impaired loans, and loans criticized by the Bank’s regulators. An independent consultant is retained to review both the loan portfolio as well as the overall adequacy of the loan loss reserve. The methodology used to arrive at an appropriate allowance for loan loss involves a high degree of management judgment. It is the goal of this loan loss reserve adequacy process to provide a loan loss reserve sufficient to address the Bank’s risk of loan losses, in the existing loan portfolio, during various economic cycles. During the review of the loan loss reserve, the Committee considers allocations of the loan loss reserve to those specific loans reviewed by the Committee on a loan-by-loan basis. Also considered is an inherent loan loss in specific pools of similar loans, based on prior historical loss activity and the impact of the current economic environment. The sum of all analyzed loan components is compared to the loan loss reserve balance, and any adjustments deemed necessary to the loan loss reserve balance are made on a timely basis.

The Bank is a Pennsylvania banking institution subject to the jurisdiction of the Pennsylvania Department of Banking, and is a state member bank of the Federal Reserve System. The Bank is regulated and periodically examined by both those entities. There are no recommendations by the regulators, which would have a material effect on the Corporation’s or Bank’s asset quality, liquidity, capital resources, or results of operations.

Off-Balance Sheet Commitments and Contractual Cash Obligations

The Bank has financial instruments with off-balance sheet risk that are used to help our customers meet their financing needs. These instruments have elements of credit risk that exceed the amount recognized in the consolidated statements of financial condition. The commitments to extend credit totaled $277,839,000 at December 31, 2004 and $222,389,000 at December 31, 2003. Unfunded mortgage commitments totaled $3,103,000 at December 31, 2004 and $13,134,000 at December 31, 2003. Total loan commitments to extend credit were $269,036,000 at December 31, 2004 and $213,207,000 at December 31, 2003. The increase in commitments to extend credit is primarily concentrated in the commercial and home equity lines of credit secured by real estate. Standby letters of credit, which are conditional commitments issued by the Bank to a customer for a third party to support a private borrowing arrangement, were $8,803,000 and $9,182,000 as of December 31, 2004 and December 31, 2003, respectively. These commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Please refer to Note 15 to the accompanying Consolidated Financial Statements for expanded discussion of off-balance sheet commitments.

The following chart presents the off-balance sheet commitments of the Bank as of December 31, 2004, listed by dates of funding or payment:

(In thousands)	Total		Within 1 year		2 - 3 years		4 - 5 years		After 5 years
Unfunded loan commitments	$	269,036	$	155,127	$	40,608	$	60,683	$	12,618
Standby letters of credit		8,803		8,803		—		—		—
Total	$	277,839	$	163,930	$	40,608	$	60,683	$	12,618

While unfunded loan commitments and standby letters of credit could potentially be funded within a one (1) year timeframe from date of issuance, funding of these unfunded amounts will not necessarily be required within the one (1) year timeframe and funding requirements could be partially funded by repayments of existing loan balances.

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The Bank has entered into a number of contractual obligations to support the ongoing activities of the Bank. The following chart presents the contractual cash obligations of the Bank as of December 31, 2004, listed by dates of required payments:

(In thousands)	Total		Within 1 year		2 - 3 years		4 - 5 years		After 5 years
Deposits without a stated maturity (a)	$	569,795	$	569,795	$	—	$	—	$	—
Consumer CD’s (b)		110,470		89,449		20,433		489		99
Operating leases		11,516		787		1,246		1,172		8,311
Purchase obligations		3,372		1,810		1,047		465		50
Non-discretionary pension contributions		131		131		—		—		—
Total	$	695,284	$	661,972	$	22,726	$	2,126	$	8,460

(a) Excludes interest

(b) Includes interest

The Bank’s operating lease obligations represent rental payments for facilities and data processing equipment. Purchase obligations represent obligations under agreements to purchase goods and services that are enforceable and legally binding on the Bank. The purchase obligations are primarily related to contractual payments for the outsourcing of certain operational activities and informational technology. The amount of non-discretionary pension contributions for future periods cannot be readily determined. The non-discretionary pension payment included in the chart represents the required payments to participants in the Corporation’s Supplemental Employee Retirement Plan (“SERP”).

Asset and Liability Management

Through its Asset/Liability Committee (“ALCO”) and the application of its risk management policies and procedures, the Bank seeks to minimize its exposure to interest rate risk as well as to maintain sufficient liquidity and capital compliance.

Interest Rate Sensitivity

The difference between interest sensitive assets and interest sensitive deposits, stated in dollars, is referred to as the interest rate sensitivity gap. A positive gap is created when interest rate sensitive assets exceed interest rate sensitive deposits. A positive interest rate sensitive gap will result in a greater portion of assets compared to deposits repricing with changes in interest rates within specified time periods. The opposite effect results from a negative gap. In practice, however, there may be a lag in repricing some products in comparison to others. A positive gap in the short-term, 30 days or less, in a rising interest rate environment should produce an increase in net interest income. The converse is true of a negative gap in a rising interest rate environment.

As shown in the following table, the Bank is presently asset interest rate sensitive in the short-term, 30 days or less category.

TABLE 16 - Interest Rate Sensitivity Analysis as of December 31, 2004

	Repricing Periods
(dollars in thousands)	0 to 30 Days			31 to 90 Days			91 to 180 Days			181 to 365 Days			Over 1 Year			Non-Rate Sensitive			Total
Assets:
Interest-bearing deposits with other banks	$	15,293		$	—		$	—		$	—		$	—		$	—		$	15,293
Federal funds sold		13,423			—			—			—			—			—			13,423
Investment securities		3,053			3,012			3,466			7,047			18,846			17			35,441
Loans		299,666			11,465			12,614			17,363			223,489			(6,927	)		557,670
Cash and due from banks		—			—			—			—			—			26,526			26,526
Other assets		—			—			—			—			—			34,593			34,593
Total assets	$	331,435		$	14,477		$	16,081		$	24,410		$	242,334		$	54,209		$	682,946
Liabilities and shareholders’ equity:
Demand, noninterest-bearing	$	30,486		$	—		$	—		$	—		$	—		$	116,750		$	147,236
Savings deposits		18,847			37,692			15,911			31,821			238,988						343,259
Time deposits		19,591			23,782			15,528			30,548			21,021						110,470
Other liabilities		26			—			—						—			10,717			10,743
Shareholders’ equity		—			—			—			—			—			71,238			71,238
Total liabilities and shareholders’ equity	$	68,950		$	61,474		$	31,439		$	62,369		$	260,009		$	198,705		$	682,946
Gap		262,485			(46,997	)		(15,358	)		(37,959	)		(17,675	)		(144,496	)		—
Cumulative gap		262,485			215,488			200,130			162,171			144,496			—			—
Cumulative earning assets as a ratio of interest bearing liabilities		862	%		346	%		276	%		199	%		139	%		151	%		—

20

The Corporation measures its interest rate risk as it effects its market value of portfolio equity using a discounted cash flow analysis to determine the net present value (“NPV”) of its net assets (assets minus liabilities). NPV is calculated based on the net present value of estimated cash flows utilizing various assumptions. The Corporation’s interest rate risk is measured as the change to its NPV as a result of a hypothetical immediate 100 and 200 basis point change in market interest rates. Based on this analysis at December 31, 2004 the Corporation would experience a 64 basis point decrease in its NPV as a percent of assets if interest rates decrease by 100 basis points in comparison to a flat rate scenario. Due to the abnormally low interest rate environment, decreases of 200 basis points have been omitted.

Changes in Market Interest Rates Basis Points	Market Value of Portfolio Equity
	$ Amount		$ Change			% Change		NPV Ratio(a)
+200	$	63,883	$	1,068		1.70	%	9.67	%
+100		63,889		1,074		1.71	%	12.53	%
0		62,815		—		—		—
-100		59,182		(3,633	)	(5.78	)%	8.62	%

(a) Calculated as the estimated NPV divided by the present value of total assets.

The Bank uses income simulation models to measure its interest rate risk and to manage its interest rate sensitivity. The simulation models consider not only the impact of changes in interest rates on forecasted net interest income, but also such factors as yield curve relationships, loan prepayments, and deposit withdrawals. As of year-end 2004, based on an analysis of the results from the simulation models, the Bank’s interest rate risk was within the acceptable range as established by the Bank’s Asset/Liability Policy.

While future interest rate movements and their effect on Bank revenue cannot be predicted, there are no trends, events, or uncertainties of which the Corporation’s management is currently aware that will have, or are reasonably likely to have, a material effect on the Corporation’s liquidity, capital resources, or results of operations in the future. In future periods, should interest rates begin to rise, the Corporation would benefit from its asset interest rate sensitivity, increasing its net interest margins, while continuing to decrease its revenues obtained from residential refinancing.

Liquidity

The Bank’s liquidity is maintained by managing its core deposits, purchasing federal funds, selling loans to the secondary market, and borrowing from the FHLB.

The Bank’s liquid assets include cash and cash equivalents as well as certain unpledged investment securities. Bank management has developed a liquidity measure, incorporating its ability to borrow from the FHLB to meet liquidity needs and goals. Monthly, ALCO reviews the Bank’s liquidity needs, incorporating the ability to borrow from the FHLB and reports these findings to the Risk Management Committee of the Bank’s Board of Directors.

As presented in the Consolidated Statement of Cash Flows on page 28 of this Report, during 2004, cash provided by operations amounted to $9,311,000. This was a $26,672,000 decrease from $35,983,000 of income from continuing operations in 2003. This decrease was due primarily to a $30,960,000 net decrease in proceeds from loan sales, net of loans originated for sale from $35,025,000 in 2003 to $4,065,000 in 2004. Gains on the sale of loans also provided $4,065,000 in positive cash flow from operations.

Cash used for investing activities amounted to $68,756,000. Investment activity used $4,217,000 in cash, as the balance in the investment portfolio increased by 13% at December 31, 2004, compared to December 31, 2003. The net funding of loans used $63,258,000 in funding. The cost of premises improvements and the purchase of equipment used $1,716,000 and the pay downs of the notes receivable from PFO, associated with the Asset Sale, increased cash flows by $435,000.

Offsetting the decrease in funds from investing activities was an increase in funds from the Bank’s financing activities, which provided $68,392,000 in net cash, primarily the result of a $73,826,000 increase in deposits. The Corporation received $597,000 in proceeds from the issuance of common stock, related to stock option exercises and used $2,574,000 to repurchase common stock, pursuant to the Stock Repurchase Program and $3,446,000 to pay dividends in 2004. The Corporation’s cash and cash equivalents increased from December 31, 2003, to December 31, 2004, by $8,947,000, from $46,295,000 at December 31, 2003 to $55,242,000 at December 31, 2004.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Quantitative and Qualitative Disclosures About Market Risk are included in the Management Discussion and Analysis under the headings of Off-Balance Sheet Commitments and Contractual Cash Obligations, Asset and Liability Management, Interest Rate Sensitivity and Liquidity.

Developments for 2005

Effective February 1, 2005, the Bank started a subsidiary, BMT Mortgage Services, Inc. (“BMTMS”) to enter into an agreement with MIGC Financial LLC and MIGC Financial Agent Investment LLC, d/b/a Keller Williams, Main Line Realty (“K/W”), to form Bryn Mawr Mortgage Company, LLC (the “LLC”), a limited liability company, whereby K/W will refer their clients to the LLC. Mortgage loan applications taken by the LLC will be submitted to BMT Mortgage Company, a division of the Bank. Fees and gains on the sale of loans generated under this agreement will be credited to the LLC. Both BMTMS and K/W will share in the net profits or losses of the LLC.

21

The Bank anticipates opening its next branch, located in Exton, Pennsylvania, during the first quarter of 2005. This branch will service the western area of the Main Line and parts of Chester County.

2003 VS. 2002 RESULTS OF OPERATIONS

Income from continuing operations

Income from continuing operations was $11,272,000 in 2003 a 6% increase over $10,642,000 reported for 2002. Basic earnings per share for 2003 were $1.30, a 7% increase over $1.22, reported for 2002. Diluted earnings per share for 2003 were $1.28, a 7% increase over $1.20 reported for 2002.

Loss from discontinued operations

The Corporation reported a loss from discontinued operations of ($1,916,000) for 2003, compared to a loss of ($435,000) in 2002. During 2003, Corporation management determined that JWR & Co. was not meeting its strategic goals and, therefore, it was in the best interest of the Corporation to sell JWR & Co. As a result of the Corporation’s decision to sell JWR & Co.’s assets, the revenues and expenses of JWR & Co., the related write-down of goodwill and other related disposal expenses were classified as losses from discontinued operations in 2003. The primary reason for the loss in 2002 was the write-down of $400,000 in goodwill in 2002, related to JWR & Co. Both basic and diluted earnings per share from discontinued operations amounted to ($0.22) in 2003, compared to ($0.05) in 2002.

Net Income

Net income for the year ended December 31, 2003, was $9,356,000, an 8% decrease from net income of $10,207,000 for the year ended December 31, 2002. Basic earnings per share decreased 8% from $1.17 in 2002 to $1.08 in 2003. Diluted earnings per share decreased 8% from $1.15 for 2002 compared to $1.06 in 2003. In 2002, the Corporation paid dividends of $0.38 per share. In 2003, the Corporation paid dividends of $0.40 per share.

Return on average assets was 2.01% for 2002 compared to 1.98% in 2003. Return on average equity was 17.26% in 2002 versus 17.76% in 2003.

Net Interest Income

Average earning assets grew 13%, primarily in higher yielding average loans, which also grew by 13%. The growth in higher yielding earning assets was offset by an 80 basis point decline in the average yield on earning assets during 2003, which was primarily responsible for a $151,000 or 1% decrease in interest income.

Average outstanding deposits, short-term borrowing and federal funds purchased also increased by 13%, with non-interest bearing checking accounts growing by 15%, while other savings deposits increased by 19%. Average outstanding CDs increased by 22%, while average short-term borrowings decreased by 98%, reflecting the large increases in average deposits during 2003, compared to 2002. The cost of funds for the Bank averaged .9% for 2003 compared to 1.0% for 2002, a 10 basis point decrease.

Net interest income increased by $3,000 from 2002 to 2003, and the net interest margin decreased from 5.34% for 2002 to 4.70% for 2003.

Loan Loss Provision

The provision for loan losses amounted to $750,000 for 2003 compared to $1,000,000 in 2002. The ratio of the allowance for loan losses to total outstanding loans was 1.33% and 1.31% at December 31, 2003 and 2002, respectively.

Other Income

Other income increased $2,678,000 or 11% in 2003 from 2002 levels. The largest increases occurred in three specific categories. Net gains on the sale of loans were up $997,000 or 10% from $9,653,000 at December 31, 2002, compared to $10,650,000 as of December 31, 2003, reflecting the results of a 13% increase in the sale or residential mortgage loans in 2003, compared to 2002. Fees for investment management and trust services were up $864,000 or 10% from $8,620,000 for 2002 to $9,484,000 for 2003, due primarily to a 13% increase in the market value of assets managed in the Wealth Management business segment. Other fees and service charges grew by $673,000 or 39% from $1,747,000 for 2002, compared to $2,420,000 for 2003, reflecting the increase in residential mortgage loan sale activity in 2003, compared to 2002.

Other Expenses

Other expenses increased by $1,795,000 or 6%, from $31,642,000 for 2002 to $33,437,000 for 2003. Regular salaries increased $889,000 or 7%, from $12,707,000 for 2002 to $13,596,000 for 2003. Salaries-other, primarily incentive based, decreased $1,540,000 or 52%, from $2,978,000 for 2002 to $1,438,000 for 2003. The decrease was directly related to lower incentive-based compensation, which is directly related to corporate profitability.

Employee benefits cost increased by $1,058,000 or 32% from $3,295,000 for 2002 to $4,353,000 for 2003. Of this increase, $802,000 relates to increases in the cost of the Corporation’s pension plan, due primarily to reductions in the value of plan assets, as well as the lower projected returns on plan assets.

Advertising expenses decreased $391,000 or 37%, from $1,065,000 for 2002 to $674,000 for 2003, reflecting decreases in the Corporation’s advertising campaign in 2003, compared to 2002.

The amortization of MSRs increased $1,197,000 or 74% from 2002 to 2003. This increase is associated with the increase in the residential refinancing activity in 2003, compared to 2002, discussed in the Mortgage Banking segment.

Other operating expenses increased $587,000 or 14% from 2002 to 2003. Increased residential mortgage loan sale activity

22

in 2003 also generated increased related expenses, such as appraisal fees and loan pair off fees. Other operating expenses associated with the increased residential mortgage lending activity increased by $769,000. Included in other operating expense in 2003 was a $250,000 elimination of a prior accrual for potential litigation that was deemed unnecessary as of December 31, 2003. Exclusive of the increased residential mortgage lending related expenses in 2003 and the elimination of the $250,000 accrual reversal, other operating expenses increased by $142,000 or 3% in 2003, compared to 2002.

Income Taxes

The income tax provision for 2003 was $6,049,000, or a 34.4% effective rate, compared to $5,543,000, or a 34.2% effective rate, for 2002.

Management’s Report on Internal Control over Financial Reporting

Corporation management is responsible for both establishing and maintaining adequate internal control over financial reporting. As of December 31, 2004, management conducted an assessment of the effectiveness of the Corporation’s internal control over financial reporting and concluded that such internal control is effective and found no material weaknesses. The assessment was accomplished using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control – Integrated Framework. Management has concluded that, as of December 31, 2004, the Corporation’s internal control over financial reporting is effective, based on the COSO criteria.

Management’s assessment of the effectiveness of the Corporation’s internal control over financial reporting as of December 31, 2004 has been audited by KPMG LLP, the Corporation’s independent registered public accounting firm, having responsibility for auditing the Corporation’s financial statements (“KPMG”). KPMG has expressed unqualified opinions on management’s assessment and on the effectiveness of the Corporation’s internal control over financial reporting as of December 31, 2004 and has issued an attestation report on the Corporation’s management’s assessment of the Corporation’s internal control over financial reporting as of December 31, 2004.

23

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders Bryn Mawr Bank Corporation:

We have audited management’s assessment, included in the accompanying Management’s Report on Internal Control Over Financial Reporting appearing under Item 9A, that Bryn Mawr Bank Corporation and subsidiaries (the “Company”) maintained effective internal control over financial reporting as of December 31, 2004, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Company management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management’s assessment and an opinion on the effectiveness of the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management’s assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, management’s assessment that the Company maintained effective internal control over financial reporting as of December 31, 2004, is fairly stated, in all material respects, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2004, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Bryn Mawr Bank Corporation and subsidiaries as of December 31, 2004, and the related consolidated statements of income, shareholders’ equity, comprehensive income and cash flows for the year ended December 31, 2004, and our report dated March 2, 2005 expressed an unqualified opinion on those consolidated financial statements. The accompanying consolidated financial statements of the Company as of December 31, 2003 and for the years ended December 31, 2003 and 2002, were audited by other auditors whose report thereon dated February 27, 2004, expressed an unqualified opinion on those statements.

KPMG LLP

Philadelphia, Pennsylvania

March 2, 2005

24

Report of Independent Registered Public Accounting Firm

The Board of Directors Bryn Mawr Bank Corporation:

We have audited the accompanying consolidated balance sheet of Bryn Mawr Bank Corporation and subsidiaries (the “Company”) as of December 31, 2004, and the related consolidated statements of income, changes in shareholders’ equity, comprehensive income, and cash flows for the year then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. The accompanying consolidated financial statements of the Company as of December 31, 2003 and for the years ended December 31, 2003 and 2002, were audited by other auditors whose report thereon dated February 27, 2004, expressed an unqualified opinion on those statements.

We conducted our audit in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States). 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 the Company as of December 31, 2004, and the results of their operations and their cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of the Company’s internal control over financial reporting as of December 31, 2004, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated March 2, 2005 expressed an unqualified opinion on management’s assessment of, and the effective operation of, internal control over financial reporting.

KPMG LLP

March 2, 2005

Philadelphia, Pennsylvania

25

Consolidated Balance Sheets

	2004			2003*
As of December 31,	(In thousands)
Assets
Cash and due from banks	$	26,526		$	32,471
Interest-bearing deposits with other banks		15,293			10,524
Federal funds sold		13,423			3,300
Investment securities available for sale, at market value (amortized cost of $35,654 and $31,411 at December 31, 2004 and 2003, respectively)		35,441			31,397
Portfolio loans		555,889			498,725
Loans held for sale, at fair market value		8,708			3,691
Less: Allowance for loan losses		(6,927	)		(6,670	)
Net loans		557,670			495,746
Premises and equipment, net		14,162			13,756
Accrued interest receivable		2,579			2,274
Mortgage servicing rights		3,172			4,391
Other assets		14,680			10,989
Total assets	$	682,946		$	604,848
Liabilities
Deposits:
Demand, noninterest-bearing	$	147,236		$	144,579
Savings		343,259			285,369
Time		110,470			97,191
Total deposits		600,965			527,139
Other liabilities		10,743			10,327
Total liabilities		611,708			537,466
Commitments and contingencies (Note 15)
Shareholders’ equity
Common stock, par value $1, authorized, 25,000,000 shares, issued 11,172,582 shares and 11,135,232 shares as of December 31, 2004 and 2003, respectively, and outstanding 8,597,958 shares and 8,670,974 shares as of December 31, 2004 and 2003, respectively		11,172			11,135
Paid-in capital in excess of par value		7,112			6,487
Accumulated other comprehensive (loss) income, net of deferred income taxes		(288	)		(126	)
Retained earnings		75,179			69,280
		93,175			86,776
Less: Common stock in treasury, at cost — 2,574,624 and 2,464,258 shares at December 31, 2004 and 2003, respectively		(21,937	)		(19,394	)
Total shareholders’ equity		71,238			67,382
Total liabilities and shareholders’ equity	$	682,946		$	604,848

* Reclassified for comparative purposes.

The accompanying notes are an integral part of the consolidated financial statements.

26

Consolidated Statements of Income

	2004		2003*			2002*
For the years ended December 31,	(in thousands, except per share data)
Net interest income:
Interest income:
Interest and fees on loans	$	30,123	$	28,248		$	28,129
Interest on federal funds sold		191		110			112
Interest on deposits with other banks		48		37			54
Interest and dividends on investment securities:
Taxable interest income		820		747			1,013
Tax-exempt interest income		165		86			39
Dividend income		34		33			65
Total interest income		31,381		29,261			29,412
Interest expense on deposits		4,543		4,322			4,065
Interest expense on federal funds purchased		9		1			33
Interest expense on other borrowings		1		7			386
Total interest expense		4,553		4,330			4,484
Net interest income		26,828		24,931			24,928
Loan loss provision		900		750			1,000
Net interest income after loan loss provision		25,928		24,181			23,928
Other income:
Fees for investment management and trust services		10,087		9,484			8,620
Service charges on deposit accounts		1,827		1,896			1,822
Other fees and service charges		1,879		2,420			1,747
Net gain on sale of loans		2,920		10,650			9,653
Net gain on sale of mortgage servicing rights		1,145		—			—
Investment advisory and brokerage fees		216		248			216
Insurance commission income		299		268			275
Other operating income		1,421		1,611			1,566
Total other income		19,794		26,577			23,899
Other expenses:
Salaries-regular		13,567		13,596			12,707
Salaries-other		1,446		1,438			2,978
Employee benefits		4,297		4,353			3,295
Occupancy expense		2,161		1,961			1,942
Furniture, fixtures, and equipment		1,785		1,806			1,819
Advertising		879		674			1,065
Professional fees		1,799		937			990
Computer processing		587		607			595
Stationery and supplies		282		316			309
Insurance		151		156			133
Amortization of MSRs		839		2,814			1,617
Other operating expenses		3,832		4,779			4,192
Total other expenses		31,625		33,437			31,642
Income before income taxes and discontinued operations		14,097		17,321			16,185
Applicable income taxes:
Federal		4,741		6,005			5,500
State		11		44			43
Income from continuing operations		9,345		11,272			10,642
Loss from discontinued operations, net of income tax benefit of $ - , ( $200,000) and ($ 18,000)		—		(1,916	)		(435	)
Net income	$	9,345	$	9,356		$	10,207
Basic earnings per common share:
Income from continuing operations	$	1.09	$	1.30		$	1.22
Loss from discontinued operations	$	0.00	$	(0.22	)	$	(0.05	)
Total basic earnings per common share	$	1.09	$	1.08		$	1.17
Diluted earnings per common share:
Income from continuing operations	$	1.06	$	1.28		$	1.20
Loss from discontinued operations	$	0.00	$	(0.22	)	$	(0.05	)
Total diluted earnings per common share	$	1.06	$	1.06		$	1.15
Dividends per share	$	0.40	$	0.40		$	0.38
Weighted-average shares outstanding		8,610,171		8,657,527			8,706,390
Dilutive potential common shares		170,545		158,543			130,020
Adjusted weighted-average shares		8,780,716		8,816,070			8,836,410

* Reclassified for comparative purposes.

The accompanying notes are an integral part of the consolidated financial statements.

27

Consolidated Statements of Cash Flows

For the years ended December 31,	2004			2003			2002
	(in thousands)
Operating activities:
Income from continuing operations	$	9,345		$	11,272		$	10,642
Adjustments to reconcile income from continuing operations
net cash provided by operating activities:
Provision for loan losses		900			750			1,000
Provision for depreciation and amortization		1,310			1,290			1,477
Loans originated for resale		(144,916	)		(603,678	)		(566,757	)
Proceeds from sale of loans		148,981			638,703			560,576
Net gain on sale of loans		(2,920	)		(10,650	)		(9,653	)
Net gain on sale of mortgage servicing rights		(1,145	)		—			—
Provision for deferred income taxes		38			811			(349	)
Change in income taxes payable/refundable		(511	)		(1,189	)		2,629
Change in accrued interest receivable		(305	)		(156	)		104
Change in accrued interest payable		550			889			(378	)
Change in mortgage servicing rights		1,219			(435	)		(1,750	)
Other		(3,235	)		(1,624	)		404
Net cash provided (used) by operating activities		9,311			35,983			(2,055	)
Investing activities:
Purchases of investment securities		(17,568	)		(31,984	)		(14,431	)
Proceeds from maturities of investment securities		—			1,000			3,004
Proceeds from sales of investment securities available for sale		204			1,039			336
Proceeds from calls of investment securities		13,147			20,440			15,000
Net repayments (originations) of notes receivable		435			(1,603	)		—
Net loan originations		(63,258	)		(59,815	)		(49,677	)
Purchase of automobile retail installment contracts		—			—			(211	)
Purchases of premises and equipment.		(1,716	)		(2,963	)		(1,034	)
Net cash used in investing activities		(68,756	)		(73,886	)		(47,013	)
Financing activities:
Change in demand and savings deposits		60,547			42,197			72,334
Change in time deposits		13,279			1,322			20,226
Dividends paid		(3,446	)		(3,465	)		(3,317	)
Repayment of mortgage debt		—			(513	)		(46	)
Proceeds from issuance of common stock		597			838			3,181
Change in borrowed funds		—			(20,000	)		—
Purchase of treasury stock		(2,585	)		(1,787	)		(6,135	)
Net cash provided by financing activities		68,392			18,592			86,243
Net cash provided (used) by continued operations		8,947			(19,311	)		37,175
Net cash used by discontinued operations		—			(195	)		(47	)
Change in cash and cash equivalents		8,947			(19,506	)		37,128
Cash and cash equivalents at beginning of year		46,295			65,801			28,673
Cash and cash equivalents at end of year	$	55,242		$	46,295		$	65,801
Supplemental cash flow information:
Cash paid during the year for:
Income taxes	$	5,476		$	6,595		$	3,250
Interest		4,003			3,454			5,025
Non-cash transactions during the year:
From discontinued operations-Charge-off of goodwill		—			1,105			400

The accompanying notes are an integral part of the consolidated financial statements.

28

Consolidated Statements of Changes in Shareholders’ Equity

	Shares of Common Stock Issued		Common Stock			Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock
For the years ended December 31, 2004, 2003 and 2002	(in thousands, except for shares of common stock)
Balance, December 31, 2001	5,329,675		$	5,330		$	6,676		$	56,499		$	274		$	(11,472	)
Net income										10,207
Dividends declared, $ 0.76 per share										(3,317	)
Accumulated other comprehensive (loss) income, net of income taxes of ($119,000)													(233	)
Tax benefit from gains on stock option exercise							1,597
Purchase of treasury stock																(6,183	)
Retirement of treasury stock	(2,456	)		(2	)		(45	)					48
Common stock issued	213,889			213			3,015
Balance, December 31, 2002	5,541,108		$	5,541		$	11,243		$	63,389		$	41		$	(17,607	)
Net income										9,356
Dividends declared, $ 0.40 per share										(3,465	)
Accumulated other comprehensive (loss) income, net of income taxes of ($90,000)													(167	)
2-for-1 stock split	5,563,816			5,564			(5,564	)
Tax benefit from gains on stock option exercise							168
Purchase of treasury stock																(1,826	)
Retirement of treasury stock	(2,005	)		(2	)		(37	)								39
Common stock issued	32,313			32			677
Balance, December 31, 2003	11,135,232		$	11,135		$	6,487		$	69,280		$	(126	)	$	(19,394	)
Net income										9,345
Dividends declared, $ 0.40 per share										(3,446	)
Accumulated other comprehensive (loss) income, net of income taxes of ($88,000)													(162	)
Tax benefit from gains on stock option exercise							107
Purchase of treasury stock																(2,574	)
Retirement of treasury stock	(4,234	)		(4	)		(38	)								31
Common stock issued	41,584			41			556
Balance, December 31, 2004	11,172,582		$	11,172		$	7,112		$	75,179		$	(288	)	$	(21,937	)

Consolidated Statement of Comprehensive Income

	2004			2003			2002
For the years ended December 31,	(in thousands)
Net income	$	9,345		$	9,356		$	10,207
Other comprehensive income:
Unrealized holding (losses) gains arising during the period		(199	)		(362	)		(67	)
Change in unfunded pension liability, net of tax		(33	)		68			(185	)
Deferred income tax benefit (expense) on unrealized holding gains (losses) arising during the period		70			127			19
Comprehensive net income	$	9,183		$	9,189		$	9,974

The accompanying notes are an integral part of the consolidated financial statements.

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Notes to Consolidated Financial Statements

1. Basis of Presentation:

The consolidated financial statements include the accounts of Bryn Mawr Bank Corporation (the “Corporation”), The Bryn Mawr Trust Company (the “Bank”), Insurance Counsellors of Bryn Mawr, Inc. (“ICBM”), BMT Settlement Services, Inc. (“BMTSS”) and Joseph W. Roskos & Co. (“JWR & Co.”). For all years presented, all adjusting entries required for the fair presentation of the financial statements were made. All such adjustments were of a normal recurring nature. All significant intercompany transactions and accounts have been eliminated upon consolidation.

2. Summary of Significant Accounting Policies:

The accounting policies of the Corporation conform to Generally Accepted Accounting Principles (“GAAP”) and to general practices of the banking industry. The significant accounting policies are as follows:

Cash and cash equivalents:

Cash and cash equivalents include cash and due from banks, federal funds sold, and interest-bearing deposits with other banks with original maturities of three months or less. Cash balances reserved to meet regulatory requirements of the Federal Reserve Board amounted to $8,407,000 and $9,453,000 at December 31, 2004 and 2003, respectively.

Investment securities:

Management categorized all of its investment securities as available for sale as part of its asset/liability management strategy since they may be sold in response to changes in interest rates, prepayments, and similar factors. Investments in this classification are reported at the current market value with net unrealized gains or losses, net of the applicable deferred tax effect, being added to or deducted from the Corporation’s total shareholders’ equity on the balance sheet. As of December 31, 2004, shareholders’ equity decreased by $139,000 due to unrealized losses (net of $75,000 in deferred income tax benefit) of $213,000 in the investment securities portfolio. As of December 31, 2003, shareholders’ equity was decreased by $9,000 due to unrealized losses (net of $5,000 in deferred income taxes) of $14,000 in the investment securities portfolio.

Loans:

Loans are generally reported at principal amount outstanding, net of unearned income. Loans held for sale or securitization are valued on an aggregate basis at the lower of carrying amount or fair value.

Interest income on loans performing satisfactorily is recognized on the accrual method of accounting. Non-performing loans are loans on which scheduled principal and/or interest is past due 90 days or more or loans less than 90 days past due which are deemed to be problem loans by management. All non-performing loans, except consumer loans, are placed on non-accrual status, and any outstanding interest receivable at the time the loan is deemed non-performing is deducted from interest income. Consumer loan principal and interest balances deemed uncollectable are charged off on a timely basis against the loan loss reserve. The charge-off policy for all loans, including non-performing and impaired loans, considers such factors as the type and size of the loan, the quality of the collateral, and historical creditworthiness of the borrower.

As a part of its internal loan review process, management, when considering making a loan an impaired loan, considers a number of factors, such as a borrower’s current financial strength, the value of related collateral and the ability to continue to meet the original contractual terms of a loan. Major risk classifications, used to aggregate loans include both credit risk and the risk of failure to repay a loan and concentration risk. A loan is not considered impaired if there is merely an insignificant delay or shortfall in the amounts of payments. An insignificant delay or shortfall is a temporary delay in the payment process of a loan. However, under these circumstances, the Bank expects to collect all amounts due, including interest accrued at the contractual interest rate for the period of the delay.

When a borrower is deemed to be unable to meet the original terms of a loan, the loan is considered impaired. While all impaired loans are not necessarily considered non-performing loans, if a loan is delinquent for 90 days or more, it is considered both a non-performing and impaired loan. All of the Corporation’s impaired loans, which amounted to $1,353,000 and $371,000 at December 31, 2004 and 2003, respectively, were put on a non-accrual basis and any outstanding accrued interest receivable on such loans, at the time they were put on a non-accrual status, was reversed from income.

Impaired loans are required to be measured based upon the present value of expected future cash flows, discounted at the loan’s initial effective interest rate, or at the loan’s market price or fair value of the collateral, if the loan is collateral dependent. As of December 31, 2004 and 2003, no impaired loans were measured using the present value of expected future cash flows or at the loan’s market price. Impaired loans measured by the fair value of the loan’s collateral amounted to $1,353,000 and $371,000, respectively.

If the loan valuation is less than the recorded value of the loan, an impairment reserve is established for the difference. The impairment reserve is established by an allocation of the reserve for loan losses depending on the adequacy of the reserve for loan losses. All impairment reserves established in either 2004 or 2003 were allocated from the existing reserve for loan losses. As of December 31, 2004 there was $1,353,000 of impaired

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loans for which there is no related allowance for loan losses. There was no related allowance for loan loss on impaired loans, which totaled $371,000 as of December 31, 2003. Average impaired loans during both 2004 and 2003 amounted to $798,000 and $170,000, respectively.

When a loan is classified as impaired, it is put on non-accrual status and any income subsequently collected is credited to the outstanding principal balance. Therefore, no interest income was reported on outstanding loans while considered impaired in either 2004 or 2003. Loans may be removed from impaired status and returned to accrual status when all principal and interest amounts contractually due are reasonably assured of repayment within an acceptable period of time and there is a sustained period of repayment performance by the borrower, with a minimum repayment of at least six months, in accordance with the contractual terms of interest and principal. Subsequent income recognition would be recorded under the existing terms of the loan. Based on the above criteria, $62,000 and $31,000 of loan balances were removed from impaired status and returned to accrual status during 2004 and 2003, respectively.

Smaller balance, homogeneous loans, exclusively consumer loans, when included in non-performing loans, for practical consideration, are not put on a non-accrual status nor is the current accrued interest receivable reversed from income. Once deemed uncollectable, the outstanding loan is charged off through the loan loss reserve, on a timely basis.

Loan loss provision:

The loan loss provision charged to operating expense is driven by a systematic formula and those factors which, in management’s judgment, deserve current recognition in estimating loan losses including the continuing evaluation of the loan portfolio and the Bank’s past loan loss experience. The allowance for loan losses is an amount that management believes will be adequate to absorb known and inherent losses in existing loans. Additionally, the Bank’s regulators, as a routine part of their examination process, review our loan portfolio and may, at their discretion, require the Bank to add to the allowance for loan losses.

Other real estate owned:

Other real estate owned (“OREO”) consists of properties acquired by foreclosure. These assets are carried at the lower of cost or estimated fair value at the time the loan is foreclosed less estimated cost to sell. The amounts recoverable from OREO could differ materially from the amounts used in arriving at the net carrying value of the assets because of future market factors beyond the control of the Bank. Costs to improve and hold the property are capitalized as long as the carrying value is less than the appraised value otherwise these cost are charged to expense.

Deferred loan fees:

On loans where the expected life is readily determinable, the Bank defers loan fees and related direct loan origination costs. Loan fees related to loans with no stated maturity are recognized as income when received. Deferred loan fees and costs are capitalized and amortized as a yield adjustment over the life of the loan using the interest method.

Premises and equipment:

Premises and equipment are stated at cost, less accumulated depreciation. The provision for depreciation is computed on a straight-line basis over the estimated useful lives, as follows: premises—10 to 50 years, and equipment—3 to 20 years. Leasehold improvements are amortized over the shorter of the estimated useful life or the term of the lease. Maintenance and repairs are charged to expense; major renewals and betterments are capitalized. Gains and losses on dispositions are reflected in current operations.

Accounting for Stock-Based Compensation:

As permitted in Statement of Financial Accounting Standard No. 123 “Accounting for Stock Based Compensation”, the Corporation has elected to use the intrinsic value method of accounting for stock-based employee compensation. Following is a summary presentation for the previous 5-year period of net income and basic and diluted earnings per share, as reported, the stock-based employee compensation cost, net of related tax effects, that would have been included in the determination of net income, if the fair value method of accounting for stock-based employee compensation had been applied to all awards and proforma net income and basic and diluted earnings per share, had the fair value method of accounting for stock-based employee compensation been applied to all awards.

	2004		2003		2002		2001		2000
Net income – as reported	$	9,345	$	9,356	$	10,207	$	9,126	$	8,261
Stock-based compensation cost, net of related taxes		94		79		158		140		224
Net income – proforma	$	9,251	$	9,277	$	10,049	$	8,986	$	8,037
Basic earnings per share – as reported	$	1.09	$	1.08	$	1.17	$	1.05	$	0.96
Diluted earnings per share – as reported	$	1.06	$	1.06	$	1.15	$	1.02	$	0.93
Basic earnings per share – proforma	$	1.07	$	1.07	$	1.15	$	1.04	$	0.94
Diluted earnings per share – proforma	$	1.05	$	1.05	$	1.14	$	1.01	$	0.90

Income taxes:

The Corporation files a consolidated Federal income tax return with its subsidiaries. Certain items of income and expense (primarily pension and post retirement benefits, provision for loan loss and other reserves) are reported in different periods for tax purposes. Deferred taxes are provided on such temporary differences existing between financial and income tax reporting, subject to the deferred tax asset realization criteria required

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under Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes” (“SFAS No. 109”).

Trust income:

Trust income is recognized on the accrual basis of accounting.

Goodwill:

The excess of cost over fair market value of net assets acquired through the purchase method of accounting (Goodwill) was being amortized on a straight-line basis over the period of the expected benefit, which ranges from 10 to 20 years. Under the provisions of Statement of Financial Accounting standard No. 142 “Goodwill and Other Intangible Assets” (“SFAS No. 142”), in years subsequent to 2002, goodwill would no longer be amortized but rather, would be periodically measured for impairment and if any expected benefit from an acquisition becomes impaired, the respective amount of impaired goodwill would be charged-off in the period of impairment. As of December 31, 2004 and 2003, there was no goodwill on the books of the Corporation.

Mortgage Servicing Rights:

Mortgage servicing rights (“MSRs”) are recorded when residential mortgage loans are sold with servicing retained by the Bank. A quarterly independent valuation of MSRs is completed to determine (1) the market value of the MSR portfolio at that quarter end and (2) the projected cash flows from the MSR portfolio for the subsequent quarter (the “MSR Valuation”). The subsequent cash flow projections, which measures a number of factors, including the projected pre-payment speeds of the respective mortgage loans, is the basis for the amortization of the MSRs in the subsequent quarter. The amount of quarterly amortization is measured each quarter, from the results of the quarterly MSR Valuation and any changes to the amount of amortization are made on a quarterly basis. When loans are paid off, any unamortized balances of the respective MSRs are written off against current Bank net income. Should any impairment of the MSRs be determined by the quarterly MSR Valuation, the balance of the MSRs would be written down by the amount of the impairment.

Recently issued accounting standards:

In December 2004, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard No. 123 (revised 2004) “Share Based Payment” (“SFAS No. 123 (R)”). SFAS No. 123 (R) establishes standards for the accounting for the transactions in which an entity exchanges its equity instruments for goods and services. SFAS No. 123 (R) requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award-the requisite service period (usually the vesting period). SFAS No. 123 (R) eliminates the alternative to use APB Opinion No. 25’s intrinsic value method of accounting that was provided in SFAS No. 123, as originally issued. Under Opinion No. 25, issuing stock options to employees generally resulted in recognition of no compensation cost. SFAS No. 123 (R) requires entities to recognize the cost of employee services received in exchange for awards of equity instruments based on the grant-date fair value of those awards. SFAS No. 123 is effective for fiscal years and interim periods beginning after June 15, 2005. Previously, the Corporation chose to follow the intrinsic methodology allowed under the original SFAS No. 123. The Corporation will adopt SFAS No. 123 (R) for interim periods beginning after June 15, 2005 and, therefore, anticipates recording additional expense associated with the issuance of stock options to employees. Beginning in the third quarter of 2005, the adoption of SFAS No. 123 (R) will have a material impact on the financial condition or results of operations of the Corporation, reducing net income in 2005 by approximately $130,000.

In December 2003, FASB revised Interpretation No. 46 (FIN 46R), “Consolidation of Variable Interest Entities, an interpretation of Accounting Research Bulletin No. 51” (the “Interpretation”). The Interpretation requires the consolidation of entities in which an enterprise absorbs a majority of the entity’s expected losses, receives a majority of the entity’s expected residual returns, or both, as a result of ownership, contractual or other financial interests in the entity. Currently, entities are generally consolidated by an enterprise when it has a controlling financial interest through ownership of a majority voting interest in the entity. Application of this Interpretation is required in financial statements of public entities that have interests in variable interest entities or potential variable interest entities commonly referred to as special purpose entities for periods ending after December 15, 2003. Application by public entities for all other types of entities is required in financial statements for periods ending after March 15, 2004. The adoption of FIN 46R did not have a material impact on the financial condition or results of operations of the Corporation.

In December 2003, the Emerging Issues Task Force issued EITF 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments.” The EIFT addresses disclosure requirements regarding information about temporarily impaired investments. The requirements are effective for fiscal years ending after December 15, 2003 for all entities that have debt or marketable equity securities with market values below carrying values. The requirements apply to investments in debt and marketable equity securities that are accounted for under SFAS 115, “Accounting for Certain Investments in Debt and Equity Securities.” The requirements apply only to annual financial statements. As of December 31, 2004, the Company has included the required disclosures in footnote 3 to the financial statements.

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3. Investment Securities

The amortized cost and estimated market value of investments, all of which were classified as available for sale, are as follows:

As of December 31, 2004:

(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Market Value
Obligations of the U.S. Government and agencies	$	28,939	$	8	$	(156	)	$	28,791
State & political subdivisions		5,181		18		(100	)		5,099
Other securities		1,534		17		—			1,551
Total	$	35,654	$	43	$	(256	)	$	35,441
As of December 31, 2003:
(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Market Value
Obligations of the U.S. Government and agencies	$	25,081	$	111	$	(79	)	$	25,113
State & political subdivisions		5,177		25		(89	)		5,113
Other securities		1,153		18		—			1,171
Total	$	31,411	$	154	$	(168	)	$	31,397

The following table shows the amount of securities that were in an unrealized loss position at December 31, 2004:

	Less than 12 Months					12 Months or Longer					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
US Treasury obligations and direct obligations of US Government Agencies	$	19,306	$	(134	)	$	1,979	$	(22	)	$	21,285	$	(156	)
State and political subdivisions		1,913		(39	)		1,671		(61	)		3,584		(100	)
Federal agency mortgage-backed securities		—		—			—		—			—		—
Other		—		—			—		—			—		—
Subtotal, Debt Securities		21,219		(173	)		3,650		(83	)		24,869		(256	)
Common Stock		—		—			—		—			—		—
Total temporarily impaired securities	$	21,219	$	(173	)	$	3,650	$	(83	)	$	24,869	$	(256	)

As of December 31, 2004, the amount of unrealized losses, for less than twelve months, in debt and equity securities classified as either available-for-sale or held-to-maturity was $173,000 and had a fair value of $21,219,000. The amount of unrealized losses, for twelve months or longer, in debt and equity securities classified as either available-for-sale or held-to-maturity was $83,000 and had a fair value of $3,650,000. As of December 31, 2004 the Corporation has concluded that the unrealized losses are temporary in nature since they are primarily related too market interest rates and are not related to the underlying credit quality of the issuers of the investment portfolio. None of the investments are believed to be other-than-temporarily impaired. The Corporation has the ability and intent to hold the securities until maturity to recover the entire value.

At December 31, 2004, securities having a book value of $15,960,000 were pledged as collateral for public funds, trust deposits, and other purposes.

The amortized cost and estimated market value of investment securities at December 31, 2004, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	2004
(in thousands)	Amortized Cost		Estimated Market Value
Due in one year or less	$	3,555	$	3,529
Due after one year through five years		21,439		21,351
Due after five years through ten years		9,487		9,371
Due after ten years		—		—
Other securities		1,173		1,190
Total	$	35,654$		35,441

There were no sales of debt securities during 2004, 2003 or 2002.

4. Loans:

Loans outstanding at December 31 are detailed by category as follows:

(in thousands)	2004			2003
Real estate loans:
Permanent
commercial mortgage loans	$	137,481		$	120,188
second mortgage loans		25,661			31,203
mortgage loans available for sale		8,708			3,691
mortgage loans		159,035			114,677
Construction loans		37,000			36,358
Commercial and industrial loans		186,923			178,381
Loans to individuals for household, family, and other consumer expenditures		10,291			18,580
Subtotal		565,099			503,078
Less: Allowance for loan losses		(6,927	)		(6,670	)
Net deferred loan fees		(502	)		(662	)
Loans, net	$	557,670		$	495,746
Unadvanced loan funds	$	269,036		$	222,389
Loans with predetermined rates		265,543			131,829
Loans with adjustable or floating rates		299,556			371,249
Total	$	565,099		$	503,078

All loans past due 90 days or more, except consumer loans, are placed on nonaccrual status. Nonperforming loans amounted to $1,109,000 and $279,000 at December 31, 2004 and 2003, respectively. Forgone interest on nonaccrual loans was $88,000,

33

$1,000, and $11,000 in 2004, 2003, and 2002, respectively. There were 19 impaired loans at December 31, 2004, amounting to $1,353,000.

5. Allowance for Loan Losses:

The summary of the changes in the allowance for loan losses is as follows:

(in thousands)	2004			2003			2002
Balance, January 1	$	6,670		$	6,114		$	4,928
Charge-offs		(692	)		(227	)		(68	)
Recoveries		49			33			254
Net recoveries / (charge-offs)		(643	)		(194	)		186
Loan loss provision		900			750			1,000
Balance, December 31	$	6,927		$	6,670		$	6,114

6. Premises and Equipment:

A summary of premises and equipment at December 31 is as follows:

(in thousands)	2004			2003
Land	$	2,974		$	2,973
Buildings		15,226			14,877
Furniture and equipment		14,996			14,519
Leasehold improvements		1,552			818
Less accumulated depreciation		(20,586	)		(19,431	)
Total	$	14,162		$	13,756

Depreciation expense for the years ended December 31, 2004, 2003 and 2002 amounted to $1,310,000, $1,291,000 and $1,368,000, respectively. Future minimum rent commitments under various operating leases are as follows:

2005	$	787,501
2006	$	653,353
2007	$	592,881
2008	$	592,381
2009	$	579,852
Thereafter	$	8,311,000

7. Mortgage Servicing Rights:

The Bank records the value of mortgage servicing rights (“MSRs”) as an asset when the mortgage loans are sold and the servicing is retained by the Bank. MSRs represent the right to receive cash flows from servicing mortgage loans. The servicing rights are capitalized based on the relative fair value of the servicing right and the mortgage loan on the date the mortgage loan is sold. MSRs are amortized in proportion to, and over the period of, the estimated net servicing income. MSRs are carried at the lower of cost or estimated fair value. The Corporation obtains an independent appraisal of the fair value of its MSRs quarterly, which approximates the fair value expected in a sale between a willing buyer and seller.

MSRs are assessed quarterly for impairment based on the estimated fair value of those rights. For purposes of performing the impairment valuation, the MSR portfolio is stratified on the basis of certain predominant risk characteristics, including loan type and note rate. To the extent that the carrying value of the servicing rights exceeds estimated fair value for any stratum, a valuation allowance is established, which may be adjusted in the future as the estimated fair value of the MSRs increase or decrease. This valuation allowance is recognized in the consolidated statements of operations during the period in which impairment occurs.

The following summarizes the Corporation’s activity related to MSRs for the years ended December 31, 2004 and 2003:

(In thousands)	2004			2003
Balance, January 1	$	4,391		$	3,956
Additions		1,019			3,249
Amortization		(839	)		(2,814	)
Impairment		—			—
Sales		(1,399	)		—
Balance, December 31	$	3,172		$	4,391
Fair Value		4,132			6,828

The following summarizes the Corporation’s activity related to changes in the valuation allowance impairment of MSRs for the years ended December 31, 2004 and 2003:

	2004		2003
Balance, January 1	$	—	$	—
Impairment		—		350
Recovery		—		(350	)
Balance, December 31	$	—	$	—

At December 31, 2004, key economic assumptions and the sensitivity of the current fair value of MSRs to immediate 10 and 20 percent adverse changes in those assumptions are as follows:

	December 31, 2004
Fair value amount of MSRs	$	4,132
Weighted average life (in years)		3.7
Prepayment speeds (constant Prepayment rate) (1):		19.92	%
Impact on fair value:
10% adverse change		(293	)
20% adverse change		(558	)
Discount rate:		10.05	%
Impact on fair value:
10% adverse change		(128	)
20% adverse change		(248	)

(1) represents the weighted average prepayment rate for the life of the MSR asset.

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These assumptions and sensitivities are hypothetical and should be used with caution. As the figures indicate, changes in fair value based on a 10% variation in assumptions generally cannot be extrapolated because the relationship of the change in assumptions to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the MSRs is calculated without changing any other assumption. In realty, changes in one factor may result in changes in another, which could magnify or counteract the sensitivities.

8. Deposits:

Following is a summary of deposits as of December 31,

(in thousands)	2004		2003
Regular Savings	$	50,300	$	52,396
NOW Accounts		166,901		134,995
Market rate accounts		126,058		97,978
Time deposits (less than $100,000)		70,820		65,037
Time deposits, $100,000 or more		39,650		32,154
Total interest-bearing deposits		453,729		382,560
Non-interest-bearing deposits		147,236		144,579
Total deposits	$	600,965	$	527,139

The aggregate amount of deposit overdrafts included as loans as of December 31, 2004 and 2003 were $393,000 and $518,000, respectively.

Maturity of certificates of deposit:

(in thousands)	$100,000 or more		Less than $100,000
Maturing during:
2005	$	33,916	$	55,533
2006		5,090		12,416
2007		644		2,283
2008		—		460
2009 and thereafter		—		128
Total	$	39,650	$	70,820

9. Short Term Borrowings:

The Bank had no outstanding borrowings as of December 31, 2004 or 2003.

10. Disclosure about Fair Value of Financial Instruments:

Statement of Financial Accounting Standards No. 107, “Disclosures about Fair Value of Financial Instruments” (“SFAS No. 107”), requires disclosure of the fair value information about financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate such value. In cases where quoted market prices are not available, fair values are based on estimates using present value or other market value techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument. SFAS No. 107 excludes certain financial instruments and all non-financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Corporation.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Cash and cash equivalents:

The carrying amounts reported in the balance sheet for cash and cash equivalents approximate their fair values.

Investment securities:

Estimated fair values for investment securities are based on quoted market price, where available.

Loans:

For variable rate loans that reprice frequently and which have no significant change in credit risk, estimated fair values are based on carrying values. Fair values of certain mortgage loans and consumer loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. The estimated fair value of nonperforming loans is based on discounted estimated cash flows as determined by the internal loan review of the Bank or the appraised market value of the underlying collateral, as determined by independent third party appraisers.

Deposits:

The estimated fair values disclosed for noninterest-bearing demand deposits, NOW accounts, and Market Rate accounts are, by definition, equal to the amounts payable on demand at the reporting date (i.e., their carrying amounts). Fair values for certificates of deposit are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of expected monthly maturities on the certificate of deposit. SFAS No. 107 defines the fair value of demand deposits as the amount payable on demand and prohibits adjusting estimated fair value from any value derived from retaining those deposits for an expected future period of time.

Short Term Borrowings:

Due to the short term nature of the maturities the carrying amount of the borrowings approximates the fair value.

Other liabilities:

Estimated fair values accrued interest payable, accrued taxes payable and other accrued payables.

Off-balance sheet instruments:

Estimated fair values of the Corporation’s off-balance sheet instruments (standby letters of credit and loan commitments)

35

are based on fees and rates currently charged to enter into similar loan agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. Since fees and rates charged for off-balance sheet items are at market levels when set, there is no material difference between the stated amount and estimated fair values of off-balance sheet instruments.

The carrying amount and estimated fair value of the Corporation’s financial instruments at December 31 are as follows:

	2004				2003
(in thousands)	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial assets:
Cash and due from banks	$	26,526	$	26,526	$	32,471	$	32,471
Interest-bearing deposits with other banks		15,293		15,293		10,524		10,524
Federal funds sold		13,423		13,423		3,300		3,300
Investment securities		35,441		35,441		31,397		31,397
Mortgage servicing rights		3,172		4,132		4,391		6,828
Net loans		557,670		554,515		495,746		497,786
Total financial assets	$	651,525	$	649,330	$	577,829	$	582,306
Financial liabilities:
Deposits	$	600,965	$	601,109	$	527,139	$	527,835
Other liabilities		2,878		2,878		2,328		2,328
Total financial liabilities	$	603,843	$	603,987	$	529,467	$	530,163
Off-balance sheet instruments	$	277,839	$	277,839	$	231,571	$	231,571

11. Applicable Income Taxes:

The components of the net deferred tax asset (liabilities) as of December 31 are as follows:

(in thousands)	2004			2003
Deferred tax assets:
Loan loss reserve	$	2,270		$	2,064
Other reserves		699			525
Unrealized depreciation on investment securities		155			68
Total deferred tax asset		3,124			2,657
Deferred tax liabilities:
Depreciation		(261	)		(323	)
Installment sale and other		(339	)		—
Pension and other postretirement benefits		(1,417	)		(849	)
Originated mortgage servicing rights		(1,110	)		(1,537	)
Total deferred tax liability		(3,127	)		(2,709	)
Total net deferred tax assets (liabilities)	$	(3	)	$	(52	)

No valuation allowance was recorded as of December 31, 2004 and 2003; since management believes that it is more likely than not that the net deferred tax asset will be realized.

The provision for income taxes consist of the following:

(in thousands)	2004		2003		2002
Currently payable	$	4,714	$	5,245	$	5,755
Deferred		38		1,004		(230	)
Total	$	4,752	$	6,249	$	5,525

Applicable income taxes differed from the amount derived by applying the statutory federal tax rate of 35% to income as follows:

(in thousands)	2004			2003			2002
Computed
Tax expense statutory federal rate	$	4,934		$	6,062		$	5,665
Tax-exempt income		(140	)		(103	)		(72	)
Other, net		(42	)		90			(50	)
Tax expense from continuing operations		4,752			6,049			5,543
Tax expense (benefit) from discontinued operations		—			200			(18	)
Total income tax expense	$	4,752		$	6,249		$	5,525

* Reclassified for comparative purposes.

12. Pension and Other Postretirement Benefits

The Corporation sponsors two pension plans and a postretirement benefit plan for certain of its employees. The following tables provide a reconciliation of the changes in the plans’ benefits obligation and fair value of assets over the two-year period ending December 31, 2004, and a statement of funded status as of December 31 of both years:

	Pension Benefits						Postretirement Benefits
(Dollars in thousands)	2004			2003			2004			2003
Reconciliation of Benefit Obligation and Plan Assets
Change in benefit obligation
Benefit obligation at January 1	$	25,149		$	21,890		$	2,375		$	2,561
Service cost		1,134			922			21			16
Interest cost		1,573			1,455			188			151
Amendments
Actuarial (gain) loss		1,517			1,780			793			(149	)
Benefits paid		(967	)		(898	)		(225	)		(204	)
Benefit obligation at December 31	$	28,406		$	25,149		$	3,152		$	2,375
Change in plan assets
Fair value of plan assets at January 1	$	22,615		$	17,534		$	—		$	—
Actual return on plan assets		1,441			3,041			—			—
Employer contribution		2,807			2,938			225			183
Plan participants’ contribution								—			21
Administrative expense		(58	)
Benefits paid		(967	)		(898	)		(225	)		(204	)
Fair value of plan assets at December 31	$	25,838		$	22,615		$	—		$	—

36

Funded Status Reconciliation and Key Assumptions

	Pension Benefits						Postretirement Benefits
	2004			2003			2004			2003
Reconciliation of funded status
Funded Status	$	(2,568	)	$	(2,533	)	$	(3,152	)	$	(2,374	)
Unrecognized net actuarial (gain) loss		6,112			4,345			1,737			1,128
Unrecognized prior service cost		499			609			—			—
Unrecognized transition obligation (asset)		—			—			207			233
Prepaid accrued (benefit) cost	$	4,043		$	2,421		$	(1,208	)	$	(1,013	)
Amounts recognized in financial statements consists of:
Prepaid benefit cost/ (Accrued benefit liability)	$	3,612		$	1,992			(1,208	)		(1,013	)
Intangible asset prior service cost		222			251			—			—
Accumulated other comprehensive income (loss)		209			178			—			—
Net amount recognized	$	4,043		$	2,421		$	(1,208	)	$	(1,013	)

The Bank’s Supplemental Employee Retirement Plan (the “SERP”) was the only pension plan with an accumulated benefit obligation in excess of plan assets. The SERP’s accumulated benefit obligation was $1,788,000 as of December 31, 2004 and $1,665,000 as of December 31, 2003. There are no plan assets in the SERP due to the nature of the SERP. The Corporation’s plan for postretirement benefits other than pensions also has no plan assets.

The assumptions used in the measurement of the Corporation’s benefit obligation are shown on the following table:

	Pension Benefits				Postretirement Benefits
	2004		2003		2004		2003
Weighted-average assumptions as of end of year
Discount rate	6.00	%	6.25	%	6.00	%	6.25	%
Expected return on plan assets	8.75	%	8.75	%	N/A		N/A
Rate of compensation increase	4.00	%	5.00	%	4.00	%	4.00	%

The assumption for calculating the expected rate of return on plan assets are based on an estimated range of returns, utilizing the results of the 25^th and 75^th percentile, which are presented as a guideline within which the investment return assumption may be selected. The range was constructed using a number of actuarial assumptions to determine the range of investment results. From this calculation the 25^th and 75^th percentile returns were derived. Based on the asset allocation ranges set in the Corporation’s Pension Investment Policy, the 25^th percentile returns are approximately 6.61% and the 75^th percentile returns 10.06%. The arithmetic average return is 9.01%. Based on this data, a rate of 8.75% was selected.

	2004		2003
Assumed health care cost trend rates at the end of year
Health care cost trend rate assumed for next year	11	%	7.5	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)	6	%	5	%
Year that the rate reaches the ultimate trend rate	2010		2008

The following table provides the components of net periodic cost (income) for the plans for years ended December 31, 2004, 2003 and 2002:

	Pension Benefits									Postretirement Benefits
	2004			2003			2002			2004		2003		2002
Service cost	$	1,134		$	923		$	808		$	21	$	17	$	28
Interest cost		1,573			1,455			1,355			188		151		171
Expected return on plan assets		(1,937	)		(1,493	)		(1,807	)		—		—		—
Amortization of prior service cost		130			181			181			—		—		—
Amortization of transition obligation (asset)		—			—			—			26		26		26
Amortization of net actuarial (gain) loss		285			285			12			185		107		144
Net periodic (benefit) cost	$	1,185		$	1,351			549		$	420	$	301		369

Plan Assets

	Pension Benefits
	Target Allocation year ending	Percentage of plan assets at December 31
	Dec. 31, 2004	2004		2003
Asset Category
Equity Securities*	50% - 65%	60	%	60	%
Debt Securities	30% - 45%	29	%	29	%
Real Estate	0%	0	%	0	%
Other	1% - 5%	11	%	11	%
Total		100	%	100	%

* INCLUDES Bryn Mawr Bank Corporation common stock in the amount of $587,220 (2%) and $643,566 (3%) at December 31, 2004 and 2003, respectively.

There are no plan assets in the Corporation’s plan for postretirement benefits other than pensions.

The investment strategy of the Plan is to maintain the investment ranges listed above. The target ranges are to be periodically reviewed based on the prevailing market conditions. Any modification to the current investment strategy must be ratified by the Pension Committee of the Corporation’s board of directors. The Plan will retain approximately 2.5% of Bryn Mawr Bank Corporation common stock.

Measurement Date

The measurement date used to determine pension and other postretirement benefit measures for the pension plan and other postretirement benefits plan was December 31^st for all respective years presented.

37

Expected contribution to be Paid in the Next Fiscal Year

Based on the status of the Corporation’s defined benefit pension plan at December 31, 2004 no minimum funding requirement is anticipated for 2005. The expected contribution for the SERP is $128,834 for 2005.

Health care cost trend rate if changed by 1%

	1-Percentage Point Increase		1-Percentage Point Decrease
Effect on total of service and interest cost components	$	15,322	$	(13,645	)
Effect on accumulated postretirement benefit obligation		159,893		(275,266	)

The Medical Prescription Drug Improvement and Modernization Act of 2003 was signed into Law December 8, 2003. In accordance with FASB Staff Position FAS 106-1, the Corporation has made a one time election to defer recognition of the effect of the law in the accounting for its Plan under FAS 106 and in providing disclosure related to the Plan until authoritative guidance on the accounting for the federal prescription subsidy is issued. Any measure of the Accumulated Postretirement Benefit Obligation or Net Periodic Postretirement Benefit Cost in this report does not reflect the effect of the Act on the Plan. Authoritative guidance is pending and, when issued, could require the company to change previously reported information.

13. Stock Option Plan:

At December 31, 1988, the Corporation established a stock option and stock appreciation rights plan (the “Stock Option Plan”), which is described below. The Corporation applies APB Opinion 25 and related interpretations in accounting for the Stock Option Plan. Accordingly, no compensation cost has been recognized for the Stock Option Plan. Had compensation for the Corporation’s Stock Option Plan been determined based on the fair value at the grant date for awards in 2004, 2003 and 2002, consistent with the optional provisions of Statement of Financial Accounting Standards No. 123R, “Accounting for Stock Based Compensation,” the Corporation’s net income and earnings per share would have been reduced to the pro forma amounts indicated below:

	2004		2003		2002
Net income - as reported	$	9,345	$	9,356	$	10,207
Net Income pro forma	$	9,251	$	9,277	$	10,049
Basic earnings per share - as reported	$	1.09	$	1.08	$	1.17
Basic earnings per share - proforma	$	1.07	$	1.07	$	1.15

The fair value of each option granted is estimated on the date of the grant using the Black-Scholes option pricing model with the following weighted-average assumptions used for grants in 2004, 2003 and 2002: dividend yield of 1.76 percent, expected volatility of 21 percent, expected life of six years and risk-free interest rates of 3.9, 3.5 and 5.1 percent, respectively.

The Plan had, prior to 1994, up to 216,000 authorized and unissued or Treasury shares of the Corporation’s common stock reserved for issuance under the Plan. During 1994, the shareholders’ approved an additional 217,720 shares for issuance under the Plan. The option to purchase shares of the Corporation’s common stock was issued to key officers. During 1995, the shareholder’s approved the issuance of 80,000 shares, 20,000 to be granted to outside directors, for 4 years after each Annual Meeting. The option price was set at the last sale price for the stock on the 3rd business day following the Corporation’s Annual Meeting. Options totaling 76,000 shares of Corporation stock were issued under the outside directors’ plan. During 1998, 2001 and 2004, the shareholders approved the issuance of up to 217,606, 192,663 and 431,143 respective shares available for issuance to both employees and directors. The price will be determined by the Corporation’s Compensation Committee of the Board of Directors at the time the option is granted. Options granted may either be “incentive stock options” within the meaning of the Internal Revenue Service code, or non-qualified options. The stock options are exercisable over a period determined by the Board of Directors; however, the option period will not commence earlier than one year or be longer than ten years from the date of the grant. The Plan provides that the option price at the date of grant will not be less than the fair market value of the Corporation’s common stock. The following is a summary of transactions under the Plan:

	Shares Under Option		Available for Option		Price per Share		Weighted Average Exercise Price
Balance at December 31, 2001	828,300		258,478		$	3.69 - $15.15	$	—
Options granted	134,500		(134,500	)	$	16.25 - $18.32	$	17.76
Options exercised	(422,866	)	—		$	3.69 - $13.22	$	7.47
Options cancelled	(28,700	)	28,700		$	12.25 - $15.15	$	14.94
Balance at December 31, 2002	511,234		152,678		$	4.00 - $18.32	$	—
Options granted	142,500		(142,500	)	$	17.85 - $21.68	$	18.02
Options exercised	(53,016	)	—		$	4.00 - $18.32	$	11.72
Options cancelled	(6,334	)	6,334		$	15.15 - $18.32	$	17.06
Balance at December 31, 2003	594,384		16,512		$	4.34 - $21.68	$	14.66
Options authorized	—		431,143			—		—
Options granted	138,750		(138,750	)	$	20.47 - $22.68	$	20.51
Options exercised	(37,350	)	—		$	10.50 - $18.46	$	13.11
Options cancelled	(43,000	)	43,000		$	14.49 - $20.47	$	17.80
Balance at December 31, 2004	652,784		351,905		$	4.34 - $22.68	$	15.80

38

Information pertaining to options outstanding at December 31, 2004 is as follows:

Price range of shares under option at December 31, 2004:

	Shares Under Option	Price per Share	Remaining Contractual Life	Weighted Average Exercise Price		Number Exercisable	Weighted Average Exercise Price
	20,000	$ 4.34 -$ 6.25	0.85	$	5.49	20,000	$	5.49
	160,000	$ 8.45 -$ 12.45	4.53	$	11.45	160,000	$	11.45
	236,368	$13.22 -$ 17.85	6.65	$	15.79	167,035	$	15.04
	236,416	$18.32 -$ 22.68	8.59	$	19.63	65,444	$	18.39
Balance at December 31, 2004	652,784	$ 4.34 -$ 22.68	6.62	$	15.80	412,479	$	13.71

The weighted-average fair value of options granted during 2004, 2003 and 2002 were $4.61, $3.98 and $3.88, respectively. The number of exercisable shares at December 31, 2004, 2003 and 2002 were 401,145, 336,551 and 303,444, respectively, with respective weighted average exercise prices of $13.58, $7.09 and $5.80.

Stock appreciation rights may be granted in tandem with non-qualified stock options. No stock appreciation rights have been granted under the Plan.

The options had a $.01 per share dilutive effect on earnings per share for the years ended December 31, 2004, 2003 and 2002, respectively.

14. Related Party Transactions:

In the ordinary course of business, the Bank granted loans to principal officers, directors and their affiliates. Loan activity during 2004 and 2003 was as follows:

Following is a summary of these transactions:

(in thousands)	2004			2003
Balance, beginning of year	$	5,150		$	5,026
Additions		2,009			633
Amounts collected		(904	)		(509	)
Balance, end of year	$	6,255		$	5,150

Related party deposits amounted to $1,968,000 and $1,116,000 at December 31, 2004 and 2003, respectively.

15. Financial Instruments with Off-Balance Sheet Risk and Concentration of Credit Risk:

The Corporation 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 include commitments to extend credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated statements of financial condition. The contractual amounts of those instruments reflect the extent of involvement the Corporation has in particular classes of financial instruments.

The Corporation’s exposure to credit loss in the event of nonperformance by the counterparty to the financial instrument of commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet financial instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the agreement. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Some of the commitments are expected to expire without being drawn upon, and the total commitment amounts do not necessarily represent future cash requirements. Total commitments to extend credit at December 31, 2004 are $269,036,000. The Corporation evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Corporation upon extension of credit, is based on management’s credit evaluation of the counterparty. Collateral varies but may include accounts receivable, marketable securities, inventory, property, plant and equipment, residential real estate, and income-producing commercial properties.

Standby letters of credit are conditional commitments issued by the Bank to a customer for a third party. Such standby letters of credits are issued to support private borrowing arrangements. The credit risk involved in issuing standby letters of credit is similar to that involved in extending loan facilities to customers. The collateral varies, but may include accounts receivable, marketable securities, inventory, property, plant and equipment, and residential real estate for those commitments for which collateral is deemed necessary. The Corporation’s obligation under standby letters of credit as of December 31, 2004 amounted to $8,803,000. There were no outstanding bankers acceptances as of December 31, 2004.

As of December 31, 2004, the Corporation had no loans sold with recourse outstanding.

The Corporation grants construction, commercial, residential mortgage, and consumer loans to customers primarily in Southeastern Pennsylvania. Although the Corporation has a diversified loan portfolio, its debtors’ ability to honor their contracts is substantially dependent upon the general economic conditions of the region.

16. Risks And Uncertainties:

The earnings of the Corporation depend on the earnings of the Bank. The Bank’s earnings are dependent upon both the level of net interest income and non-interest revenue streams, primarily fees for trust services that are earned annually. Accordingly, the earnings of the Corporation are subject to risks and uncertainties surrounding both its exposure to changes in the interest rate environment and movements in financial markets.

39

Most of the Bank’s lending activity is with customers located in Southeastern Pennsylvania. Lending is spread between commercial, consumer and real estate related loans, including construction lending. While these loan concentrations represent a potential concentration of credit risk, the Bank’s credit loss experience compares favorably to the Bank’s peer group credit loss experience.

The financial statements of the Corporation are prepared in conformity with generally accepted accounting principles that require management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates.

Significant estimates are made by management in determining the allowance for loan losses and the carrying value of other real estate owned. Consideration is given to a variety of factors in establishing these estimates, including current economic conditions, the results of the internal loan review process, delinquency statistics, borrowers perceived financial and managerial strengths and the adequacy of supporting collateral, if collateral dependent, or the present value of future cash flows. Since the allowance for loan losses and the carrying value of other real estate owned are dependent, to a great extent, on general and other economic conditions beyond the Bank’s control, it is at least reasonably possible that the estimates of the allowance for loan losses and the carrying value of other real estate owned could differ materially from currently reported values in the near term.

As a part of its mortgage loan servicing business, the Bank records the value of mortgage servicing rights (“MSRs”) as an asset at the time the respective residential mortgage loan is sold with the servicing retained by the Bank. Quarterly an independent firm is retained to (1) determine if any impairment in the MSR portfolio has occurred as of the current quarter end and (2) determine the amount of amortization of MSRs to be utilized in the upcoming quarter. Certain assumptions are made in determining the loan prepayment speeds for the respective residential mortgage loans that will determine the amount of amortization for the subsequent quarter. Should movements of related interest rates differ from those projected, the actual prepayment speeds and related amortization of MSRs could differ materially from those projected by the independent valuation.

17. Goodwill:

Joseph W. Roskos & Co. was acquired as of January 1, 1999. The transaction was accomplished on April 1, 1999 under the purchase method of accounting. Goodwill arising from this transaction was recorded on the balance sheet and was being amortized on a straight line basis over a 20 year period. Beginning in 2002, under Statement of Financial Accounting Standard No. 142 - Goodwill and Other Intangible Assets (“SFAS No 142”), all components of Goodwill are no longer to be amortized, but rather tested annually for any potential impairment. During the fourth quarter of 2002, the balance of goodwill was tested for impairment. Based on a discounted cash flow analysis, reflecting lower projected revenue streams for Joseph W. Roskos & Co. in future periods, it was determined that goodwill had impairment in the amount of $400,000. Therefore, the balance of goodwill was written down by $400,000 during the fourth quarter of 2002 to $2,405,000. As of June 30, 2003, the business of Joseph W. Roskos & Co. and substantially all of its assets were sold and the balance of $1,005,000 in goodwill was written off as a part of the sale transaction. As of December 31, 2004 and 2003, there was no goodwill recorded on the books of the Corporation.

18. Minimum Regulatory Capital Requirements:

Both the Corporation and the Bank are subject to various regulatory capital requirements, administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if taken, could have a direct material effect on the Corporation’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Corporation and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The capital amounts and classifications are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Prompt corrective action provisions are not applicable to bank holding companies.

As set forth in the following table, quantitative measures have been established to ensure capital adequacy ratios required of both the Corporation and Bank, specifically to define the minimum respective capital ratios as follows: total capital to total assets (the leverage ratio) of 4%; Tier I capital to risk weighted assets of 4% and Tier II capital to risk weighted assets of 8%. Both the Corporation’s and the Bank’s Tier II capital ratios are calculated by adding back a portion of the loan loss reserve to the Tier I capital. Management believes, as of December 31, 2004 and 2003 that the Corporation and the Bank have met all capital adequacy requirements to which they are subject. Federal banking regulators have defined specific capital categories, based on an institution’s capital ratios. The categories range from a best of “well capitalized” to a worst of “critically under capitalized”. To be considered “well capitalized”, an institution must have a total (Tier II) capital ratio of 10% or better. Both the Corporation and the Bank have been classified as “well capitalized” for both periods ending December 31, 2004 and 2003.

40

The Corporation’s and the Bank’s actual capital amounts and ratios as of December 31, 2004 and 2003 are presented in the following table:

	Actual				Minimum Capital Requirement				Minimum to be Well Capitalized
	Amount		Ratio		Amount		Ratio		Amount
December 31, 2004
Total (Tier II) Capital to Risk Weighted Assets:
Consolidated	$	78,312	12.33	%			8.0	%		N/A
The Bank		69,886	11.09	%	$	50,417	8.0	%	$	63,021
Tier I Capital to Risk Weighted Assets:
Consolidated		71,378	11.24	%			4.0	%		N/A
The Bank		62,952	9.99	%		25,209	4.0	%		37,813
Total Capital to Total Assets (Leverage Ratio):
Consolidated		71,238	10.43	%			4.0	%		N/A
The Bank		62,815	9.26	%		27,122	4.0	%		33,903
December 31, 2003
Total (Tier II) Capital to Risk Weighted Assets:
Consolidated	$	74,186	13.01	%			8.0	%		N/A
The Bank		63,776	11.30	%	$	45,138	8.0	%	$	56,423
Tier I Capital to Risk Weighted Assets:
Consolidated		67,508	11.84	%			4.0	%		N/A
The Bank		57,098	10.12	%		22,569	4.0	%		33,854
Total Capital to Total Assets (Leverage Ratio):
Consolidated		67,382	11.14	%			4.0	%		N/A
The Bank		56,972	9.51	%		23,954	4.0	%		29,973

19. Selected Quarterly Financial Data (Unaudited):

	Quarters ending 2004
(In thousands, except per share data)	3/31			6/30			9/30		12/31
Interest income	$	7,452		$	7,632		$	7,969	$	8,328
Interest expense		1,083			1,083			1,155		1,232
Net interest income		6,369			6,549			6,814		7,096
Provision for loan losses		187			188			187		338
Income before income taxes		4,635			3,239			3,159		3,064
Net income	$	3,020		$	2,129		$	2,109	$	2,087
Basic earnings per common share	$	0.35		$	0.25		$	0.25	$	0.24
Diluted earnings per common share	$	0.34		$	0.24		$	0.24	$	0.24
	Quarters ending 2003
(In thousands, except per share data)	3/31			6/30			9/30		12/31
Interest income	$	7,277		$	7,264		$	7,415	$	7,305
Interest expense		1,096			1,099			1,066		1,069
Net interest income		6,181			6,165			6,349		6,236
Provision for loan losses		250			250			167		83
Income before income taxes and discontinued operations		4,414			4,191			4,427		4,288
Income from continuing operations		2,861			2,737			2,933		2,741
(Loss) income from discontinued operations		(192	)		(1,928	)		150		54
Net income	$	2,669		$	809		$	3,083	$	2,795
Basic earnings per common share
Income from continuing operations	$	0.33		$	0.31		$	0.34	$	0.32
(Loss) income from discontinued operations	$	(0.02	)	$	(0.22	)	$	0.02	$	0.00
Total earnings per common share	$	0.31		$	0.09		$	0.36	$	0.32
Diluted earnings per common share:
Income from continuing operations	$	0.32		$	0.31		$	0.33	$	0.31
(Loss) income from discontinued operations	$	(0.02	)	$	(0.22	)	$	0.02	$	0.00
Total earnings per common share	$	0.30		$	0.09		$	0.35	$	0.31

20. Condensed Financial Statements:

The condensed financial statements of the Corporation (parent company only) as of December 31, 2004 and 2003, and for each of the three years in the period ended December 31, 2004, are as follows:

Condensed Balance Sheets

(in thousands)	2004			2003
Assets:
Cash	$	1,174		$	3,076
Investments in subsidiaries, at equity in net assets		66,665			60,773
Premises and equipment, net		3,467			3,565
Assets from discontinued operations		—			—
Other assets		543			614
Total assets	$	71,849		$	68,028
Liabilities and shareholders’ equity:
Mortgages payable		—			—
Other liabilities		611			646
Total liabilities		611			646
Common stock, par value $1, authorized 25,000,000 shares as of December 31, 2004 and 2003, respectively, issued 11,172,582 shares and 11,135,232 shares as of December 31, 2004 and 2003, respectively and outstanding 8,597,958 shares and 8,670,974 shares as of December 31, 2004 and 2003, respectively		11,172			11,135
Paid-in capital in excess of par value		7,112			6,487
Accumulated other comprehensive income, net of deferred income taxes		(288)			(126)
Retained earnings		75,179			69,280
Less common stock in treasury, at cost - 2,574,624 shares and 2,464,258 shares as of December 31, 2004 and 2003		(21,937	)		(19,394	)
Total shareholders’ equity		71,238			67,382
Total liabilities and shareholders’ equity	$	71,849		$	68,028

Condensed Statements of Income
(in thousands)	2004		2003			2002
Dividends from The Bryn Mawr Trust Company	$	3,446	$	3,465		$	4,816
Interest and other income		236		236			236
Total operating income		3,682		3,701			5,052
Expenses		472		459			591
Income before equity in undistributed income of subsidiaries		3,210		3,242			4,461
Equity in undistributed income of subsidiaries		6,055		7,954			6,060
Income before income taxes and discontinued operations		9,265		11,196			10,521
Federal income tax benefit		80		76			121
Income from continuing operations		9,345		11,272			10,642
(Loss) income from discontinued operations		0		(1,916	)		(435	)
Net income	$	9,345	$	9,356		$	10,207

41

Condensed Statements of Cash Flows

(in thousands)	2004			2003			2002
Operating activities:
Income from continuing operations	$	9,345		$	11,272		$	10,641
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed income (losses) of subsidiaries		(6,054	)		(7,954	)		(6,060	)
Depreciation expense		98			98			99
Other		(19	)		(221	)		1,916
Net cash provided by operating activities		3,370			3,195			6,596
Investing Activities:
Investment in Subsidiaries		162			1,313			2,494
Net cash provided by investing activities		162			1,313			2,494
Financing activities:
Dividends paid		(3,446	)		(3,465	)		(3,317	)
Repayment of mortgage debt		0			(513	)		(46	)
Repurchase of treasury stock		(2,585	)		(1,787	)		(6,183	)
Proceeds from issuance of stock		597			838			3,228
Net cash used by financing activities		(5,434	)		(4,927	)		(6,318	)
Net cash (used) provided by continuing operations		(1,902	)		(419	)		2,772
Net cash provided by discontinued operations		0			489			0
Change in cash and cash equivalents		(1,902	)		70			2,772
Cash and cash equivalents at beginning of year		3,076			3,006			234
Cash and cash equivalents at end of year	$	1,174		$	3,076		$	3,006

These statements should be read in conjunction with the other notes related to the consolidated financial statements.

As a bank and trust company subject to the Pennsylvania Banking Code (the “Banking Code”) of 1965 as amended, the Bank is subject to legal limitations as to the amount of dividends that can be paid to its shareholder, the Corporation. The Banking Code restricts the payment of dividends by the Bank to the amount of its retained earnings. As of December 31, 2004, the Bank’s retained earnings amounted to $56,514,000. Therefore, as of December 31, 2004, dividends available for payment to the Corporation are limited to $56,514,000. Since the primary source of dividend funding for the Corporation’s dividend payments to its shareholders is the Bank’s dividends, the Corporation is effectively limited as to the amount of dividends that it may pay to an amount equal to the limits placed on the Bank, as discussed above.

42

21. Segment Information:

The Corporation’s principal operating segments are structured around the financial services provided its customers. The Banking segment gathers deposits and makes funds available for loans to its customers. The Banks Wealth Management segment provides both corporate and individual investment management and trust products and services. The Bank’s Mortgage Banking segment originates and sells residential mortgage loans to the secondary mortgage market.

Segment information for the years ended December 31, 2004, 2003, and 2002, including income from continuing operations, is as follows:

	2004															2003															2002
(in thousands)	Banking			Wealth Management			Mortgage Banking			All Other			Consolidated			Banking			Wealth Management			Mortgage Banking			All Other			Consolidated			Banking			Wealth Management			Mortgage Banking			All Other			Consolidated
Net interest income	$	26,487		$	—		$	255		$	86		$	26,828		$	24,707		$	—		$	160		$	64		$	24,931		$	24,697		$	—		$	200		$	31		$	24,928
Less loan loss provision		900			—			—			—			900			750			—			—			—			750			1,000			—			—			—			1,000
Net interest income after loan loss provision		25,587			—			255			86			25,928			23,957			—			160			64			24,181			23,697			—			200			31			23,928
Other income:
Fees for investment management and trust services		—			10,087			—			—			10,087			—			9,484			—			—			9,484			—			8,620			—			—			8,620
Service charges on deposit accounts		1,827			—			—			—			1,827			1,896			—			—			—			1,896			1,822			—			—			—			1,822
Other fees and service charges		209			—			1,670			—			1,879			199			—			2,221			—			2,420			235			—			1,512			—			1,747
Net gain on sale of loans		34			—			2,886			—			2,920			13			—			10,637			—			10,650			6			—			9,647			—			9,653
Net gain on sale of mortgage servicing rights		1,145			—			—			—			1,145			—			—			—			—						—			—			—			—			—
Other operating income		1,547						112			667			2,326			1,496						454			637			2,587			1,567			3			351			618			2,539
Total other income		4,762			10,087			4,668			667			20,184			3,604			9,484			13,312			637			27,037			3,630			8,623			11,510			618			24,381
Other expenses:
Salaries-regular		8,789			3,674			904			200			13,567			8,274			3,665			1,343			314			13,596			7,874			3,464			1,088			281			12,707
Salaries-other		942			322			171			11			1,446			479			113			833			13			1,438			1,985			291			692			10			2,978
Fringe benefits		3,260			820			165			52			4,297			3,267			839			195			52			4,353			2,451			706			88			50			3,295
Occupancy		3,246			572			249			131			4,198			2,994			617			258			216			4,085			3,086			580			172			316			4,154
Other operating expenses		5,343			1,046			1,678			440			8,507			4,182			1,002			4,855			386			10,425			4,778			891			2,859			462			8,990
Total other expenses		21,580			6,434			3,167			834			32,015			19,196			6,236			7,484			981			33,897			20,174			5,932			4,899			1,119			32,124
Segment profit (loss)		8,769			3,653			1,756			(81	)		14,097			8,365			3,248			5,988			(280	)		17,321			7,153			2,691			6,811			(470	)		16,185
Intersegment (revenues) expenses		166			181			—			(347	)		—			111			181			—			(292	)		—			(15	)		181			—			(166	)		—
Segment profit after eliminations	$	8,935		$	3,834		$	1,756		$	(428	)	$	14,097		$	8,476		$	3,429		$	5,988		$	(572	)	$	17,321		$	7,138		$	2,872		$	6,811		$	(636	)	$	16,185
% of segment profit (loss)		63	%		27	%		13	%		(3	)%		100	%		49	%		20	%		34	%		(3	)%		100	%		44	%		18	%		42	%		(4	)%		100	%
Total assets at December 31	$	588,750		$	865		$	88,446		$	4,885		$	682,946		$	528,654		$	967		$	69,636		$	5,591		$	604,848		$	485,717		$	1,117		$	86,288		$	4,305		$	577,427
Capital expenditures	$	1,874		$	32		$	42		$	6		$	1,954		$	2,848		$	22		$	52		$	3		$	2,925		$	770		$	58		$	134		$	19		$	981
Depreciation and amortization	$	1,050			$142			$80			$104			$1,376			$971			$187			$73			$105			$1,336			$1,046			$176			$31			$108			$1,361

BMT Mortgage Company, a division of the Bank and Bryn Mawr Settlement Services, Inc. have been aggregated in Mortgage Banking.

Bryn Mawr Bank Corporation, Insurance Counsellors of Bryn Mawr, Inc., and Bryn Mawr Finance Inc. have all been aggregated in All Others.

* Reclassified for comparative purposes.

43

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EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Bryn Mawr Bank Corporation:

We consent to the incorporation by reference in the Registration Statements on Form S-8 of Bryn Mawr Bank Corporation of our reports dated March 2, 2005, with respect to the consolidated balance sheet of Bryn Mawr Bank Corporation as of December 31, 2004, and the related consolidated statements of income, shareholders’ equity, comprehensive income and cash flows for the year ended December 31, 2004, management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2004 and the effectiveness of internal control over financial reporting as of December 31, 2004, which reports appear in the December 31, 2004 annual report on Form 10-K of Bryn Mawr Bank Corporation.

KPMG LLP

Philadelphia, Pennsylvania

March 2, 2005

EX-23.2

Exhibit 23.2

PricewaterhouseCoopers LLP

Two Commerce Square, Suite 1700

2001 Market Street

Philadelphia PA 19103-7042

Telephone (267) 330 3000

Facsimile (267) 330 3300

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No.033-12715 and 33-61881) of Bryn Mawr Bank Corporation of our report dated February 27, 2004 relating to the financial statements, which appears in the Annual Report to Shareholders, which is incorporated in this Annual Report on Form 10-K.

PRICEWATERHOUSECOOPERS LLP

Philadelphia, Pennsylvania

March 2, 2005

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Frederick C. Peters II, Chief Executive Officer, certify that:

1. I have reviewed this annual report on Form 10-K of Bryn Mawr Bank Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report, any change in the registrant’s

internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 3, 2005	/S/    FREDERICK C. PETERS II
	Frederick C. Peters II, Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Joseph W. Rebl, Chief Financial Officer, certify that:

1. I have reviewed this annual report on Form 10-K of Bryn Mawr Bank Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures, and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report, any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the

registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 3, 2005	/S/    JOSEPH W. REBL
	Joseph W. Rebl, Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of Bryn Mawr Bank Corporation (the “Company”) on Form 10-K for the period ending December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Frederick C. Peters II, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/S/    FREDERICK C. PETERS II        

Frederick C. Peters II

Chief Executive Officer

March 3, 2005

EX-32.2

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of Bryn Mawr Bank Corporation (the “Company”) on Form 10-K for the period ending December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Joseph W. Rebl, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge and belief:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/S/    JOSEPH W. REBL        

Joseph W. Rebl

Chief Financial Officer

March 3, 2005

EX-99.(B)

Exhibit 99(b)

Report of Independent Auditors

To the Board of Directors and Shareholders:

In our opinion, the accompanying consolidated balance sheets and the related consolidated statements of income and comprehensive income, of shareholders’ equity and of cash flows present fairly, in all material respects, the balance sheet of Bryn Mawr Bank Corporation and its subsidiaries (the “Corporation”) at December 31, 2003 and 2002, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2003 in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Corporation’s management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

As discussed in note 2 to the consolidated financial statements the Corporation adopted the Statement of the Financial Accounting Standard No. 142 “Goodwill and Other Intangible Assets” effective January 1, 2002.

PRICEWATERHOUSECOOPERS LLP

Philadelphia, Pennsylvania

February 27, 2004