First Defiance Financial to acquire Pavilion Bancorp; accretive to earnings in the first full year of operations

Co and Pavilion Bancorp (OTC Bulletin Board: PVLN) announced the execution of a definitive agreement for First Defiance to acquire Pavilion Bancorp and its wholly owned subsidiary, the Bank of Lenawee, which is headquartered in Adrian, Michigan. Each Pavilion Bancorp shareholder will receive 1.4209 shares of FDEF common stock and $37.50 in cash. Based on the closing price of FDEF shares on October 2, 2007, the transaction is valued at $55.7 mln or $75.54 per share. Transaction is expected to close late in Q1 of 2008