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                                                             EXHIBIT 2(ii)


                                MERGER AGREEMENT


         This is a MERGER AGREEMENT dated _____________, 1994, between National
City Bancshares, Inc. (hereinafter called "NCBE") and United Financial Bancorp,
Inc. (hereinafter called "United").

                                  WITNESSETH:

         NCBE is a corporation duly organized under the laws of the State of
Indiana.  Its principal office is located at 227 Main Street, Evansville,
Vanderburgh County, Indiana.  As of September 30, 1994, NCBE had authorized
capital stock consisting of 5,000,000 shares of common stock, par value $3.33
1/3 per share, ("NCBE Common Stock") of which a total of 3,693,254 shares were
issued and outstanding and none were shares of treasury stock owned by NCBE.
NCBE owns all of the outstanding capital stock of The National City Bank of
Evansville, Evansville, Indiana; The Peoples National Bank of Grayville,
Grayville, Illinois; The Farmers and Merchants Bank, Fort Branch, Indiana,
First Kentucky Bank, Sturgis, Kentucky;  Lincolnland Bank, Dale, Indiana; The
State Bank of Washington, Washington, Indiana; The Spurgeon State Bank,
Spurgeon, Indiana; Pike County Bank, Petersburg, Indiana; and The Bank of
Mitchell, Mitchell, Indiana, (hereinafter referred to as "NCBE Banks") and NCBE
Leasing Corp., Evansville, Indiana; and

         United is a corporation duly organized under the laws of the State of
Delaware.  Its principal office is located at 619 Main Street, Vincennes,
Indiana.  As of September 30, 1994, United had authorized capital stock
consisting of: (i) 2,000,000 authorized shares of common stock, $.01 par value
per share ("United Common Stock"), of which (a) 440,712 shares were issued and
outstanding; and (b) 19,288 were shares of treasury stock owned by United, and
(ii) 500,000 shares of preferred stock, none of which were either issued and
outstanding or were shares of treasury stock owned by United.  United owns all
of the outstanding capital stock of United Federal Savings Bank of Vincennes, a
federal savings bank, (hereinafter referred to as "United Bank").
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         The Board of Directors of NCBE and the Board of Directors of United,
respectively, have unanimously approved the entering into of this Merger
Agreement and have authorized the execution and delivery of this Merger
Agreement.  From and after the time the merger of United into NCBE shall become
effective, the "Merger" as defined in Section 1 of this Merger Agreement, and
as and when required by this Merger Agreement, NCBE will issue shares of NCBE
Common Stock in exchange for all of the issued and outstanding shares of United
Common Stock in accordance with the provisions hereinafter set forth.  It is
understood by each of the parties hereto that NCBE seeks to acquire United and
all of the operating assets of United including United Bank and the entities
and assets which United or United Bank own or may acquire prior to the time the
Merger shall become effective, through the Merger of United with and into NCBE
under the charter of NCBE. At the effective time of the Merger United Bank will
remain an independent operating subsidiary of NCBE.  The parties will exert
their best efforts to obtain such regulatory approvals and to complete such
other actions as are necessary or appropriate to effect the Merger.

         In consideration of mutual covenants and premises herein contained,
NCBE  and United hereby make this Merger Agreement and prescribe the terms and
conditions of the Merger and the mode of carrying the Merger into effect as
follows:

1.       Merger.  Subject to the terms and conditions hereinafter set forth,
         United shall be merged with and into NCBE under the Articles of
         Incorporation of NCBE pursuant to and in accordance with the
         applicable provisions of the laws of the States of Indiana and
         Delaware.

2.       Name.  The name of the surviving corporation (hereinafter called the
         "Surviving Corporation" whenever reference is made to it as of the
         time the Merger shall become effective, as hereinafter provided, or
         thereafter) shall be "National City Bancshares, Inc."

3.       Business.  The business of NCBE as the Surviving Corporation shall be
         that of a financial institution holding company.   The  Surviving
         Corporation shall exist by virtue of, and be governed by the laws of
         the State of Indiana, shall have its registered office in Indiana at





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         227 Main Street, Evansville, Vanderburgh County, Indiana and shall
         have its principal office at that same location.

4.       Effective Time of Merger:  Articles of Merger.  The Merger shall
         become effective upon the filing of the appropriate Articles of Merger
         with the appropriate state authorities (the "time the Merger shall
         become effective") in accordance with applicable provisions of the
         laws of the States of Indiana and Delaware.

         The Articles of Incorporation of NCBE in effect immediately prior to
         the time the Merger shall become effective, shall be the Articles of
         Incorporation of the Surviving Corporation, and the Bylaws of NCBE in
         effect immediately prior to the time the Merger shall become
         effective, shall be the Bylaws of the Surviving Corporation.

5.       Effect of Merger.  At the time the Merger shall become effective, the
         separate corporate existence of United and NCBE, respectively, shall,
         in accordance with applicable provisions of the laws of the State of
         Indiana and the State of Delaware, be merged into and continued in
         NCBE as the Surviving Corporation with the effect as provided by
         Section 23-1-40-6 of the Indiana Business Corporation Law and the
         provisions of Section 252 of the Delaware General Business Corporation
         Law.

6.       Liabilities upon Merger.  The Surviving Corporation shall be
         responsible for all of the liabilities and obligations of each of the
         corporations so merged in the same manner and to the same extent as if
         such single corporation had itself incurred the same or contracted
         therefore.

7.       Conversion of Shares.

         (a)     At the time the Merger shall become effective;

                 (i)      All of the outstanding shares of United Common Stock,
                          other than Dissenting Shares (as defined in Section
                          11 hereof), shall be converted into and exchanged for
                          shares of NCBE Common Stock (or cash for fractional
                          shares) in accordance with the Exchange Ratio (as
                          defined herein).  In determining the total number of
                          shares of NCBE Common





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                          Stock to be issued to shareholders of United, the
                          value of each share of NCBE Common Stock shall be the
                          average price per share of NCBE Common Stock for the
                          twenty business days immediately preceding the
                          effective date of the Merger (the "Average Price").
                          For purposes hereof, Average Price shall be based
                          upon information reported by the NASDAQ National
                          Market System, and shall mean with respect to NCBE
                          Common Stock, the quotient resulting from:  (a) the
                          sum of the product of; (i) the numerical average of
                          the reported high and low price per share, for each
                          of the twenty business days immediately preceding the
                          effective date of the Merger; times (ii) the total
                          number of shares of NCBE Common Stock traded on each
                          of such business days, respectively; divided by (b)
                          the aggregate number of shares traded during such
                          twenty business day period, provided that should the
                          Average Price be less than $40.50 per share, then
                          $40.50 per share shall be utilized as the Average
                          Price.  Should the Average Price be more than $49.50
                          per share, then $49.50 shall be utilized as the
                          Average Price.

                 (ii)     Notwithstanding the foregoing, the dollar amounts and
                          the 10% range set forth in the preceding two
                          sentences shall be appropriately adjusted to reflect
                          any recapitalization, reorganization, split-up,
                          merger, consolidation, exchange, stock or other
                          dividend or distribution (other than regular
                          quarterly cash dividends) made, declared or effective
                          on a pro-rata basis with respect to all issued and
                          outstanding NCBE Common Stock (a "Stock Adjustment")
                          arising between the date hereof and the time the
                          Merger becomes effective.  Provided however, that in
                          the event a Stock Adjustment (as herein defined)
                          occurs during the trading days described above then
                          the trading days for the period prior to the Stock
                          Adjustment will be eliminated in calculating the
                          Average Price.





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                 (iii)    The outstanding shares of United Common Stock other
                          than Dissenting Shares shall, at the time the Merger
                          shall become effective, automatically and without any
                          act or deed on the part of the holder thereof be
                          converted into and exchangeable for (x) newly issued,
                          fully paid and non-assessable whole shares of NCBE
                          Common Stock at the Exchange Ratio and (y) cash in
                          lieu of any fractional shares of NCBE Common Stock as
                          provided in Section 7(b) hereof.  The "Exchange
                          Ratio" means the number resulting from dividing
                          $44.40 by the Average Price, rounded to the sixth
                          decimal place, appropriately adjusted for any stock
                          dividends or stock splits with respect to United
                          Common Stock after the date of this Merger Agreement.

                 (iv)     Each of the shares of United Common Stock, if any,
                          held by United in its treasury immediately prior to
                          the time the Merger shall become effective shall be
                          canceled; and

                 (v)      The shares of NCBE Common Stock issued and
                          outstanding immediately prior to the time the Merger
                          shall become effective shall continue to be issued
                          and outstanding shares of the Surviving Corporation.

         (b)     No fractional shares or scrip representing fractional shares
                 of NCBE Common Stock will be issued by NCBE in connection with
                 the Merger, but in lieu thereof, any holder of United Common
                 Stock shall, upon surrender of the certificate or certificates
                 formerly representing such United Common Stock, be paid cash,
                 without interest, by NCBE for such fractional share(s).  The
                 cash paid for fractional shares shall be based upon the
                 Average Price.

         (c)     As soon as practicable after the time the Merger shall become
                 effective, and subject to the provisions set forth above
                 relating to the fractional shares, the Trust Department of The
                 National City Bank of Evansville, will distribute to the
                 former holders of United Common Stock in exchange for and upon
                 surrender for cancellation by such holders of a certificate or
                 certificates formerly representing





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                 shares of United Common Stock the certificate(s) for newly
                 issued, fully paid and non-assessable shares of NCBE Common
                 Stock in accordance with the Exchange Ratio and any cash
                 payment in lieu of fractional shares.  Each certificate
                 formerly representing United Common Stock (other than
                 certificates representing Dissenting Shares) shall be deemed
                 for all purposes to evidence the ownership of the number of
                 whole shares of NCBE Common Stock and cash for fractional
                 share interests in NCBE Common Stock into which such shares
                 have been converted pursuant to the Exchange Ratio.
                 Certificates representing shares of United Common Stock held
                 by a shareholder of United, shall be aggregated together in
                 determining the fractional share for which such shareholder
                 shall receive cash as provided for herein.  Until surrender of
                 the certificate or certificates formerly representing shares
                 of United Common Stock, the holder thereof shall not be
                 entitled to receive any dividend or other payment or
                 distribution payable to holders of NCBE Common Stock.  Upon
                 such surrender (or in lieu of surrender other provisions
                 reasonably satisfactory to NCBE as are made as  set forth
                 herein below), there shall be paid to the person entitled
                 thereto the aggregate amount of dividends or other payments or
                 distributions (in each case without interest) which became
                 payable after the time the Merger shall become effective on
                 the whole shares of NCBE Common Stock represented by the
                 certificates issued upon such surrender and exchange or in
                 accordance with such other provisions, as the case may be.

                 Certificates formerly representing shares of United Common
                 Stock surrendered for cancellation by each shareholder
                 entitled to exchange shares of United Common Stock for shares
                 of NCBE Common Stock by reason of the Merger shall be
                 accompanied by such customary instruments of transfer as NCBE
                 may reasonably require, provided, however, that if there be
                 delivered to NCBE by any person who is unable to produce any
                 such certificate formerly representing shares





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                 of United Common Stock for transfer (i) evidence to the
                 reasonable satisfaction of NCBE that any such certificate has
                 been lost, wrongfully taken or destroyed, and (ii) such
                 indemnity agreement as reasonably may be requested by NCBE to
                 save it harmless, and (iii) evidence to the reasonable
                 satisfaction of NCBE that such person is the owner of the
                 shares theretofore represented by each certificate claimed by
                 him to be lost, wrongfully taken or destroyed and that he is
                 the person who would be entitled to present each such
                 certificate and to receive shares of NCBE Common Stock
                 pursuant to this Merger Agreement, then NCBE, in the absence
                 of actual notice to it that any shares theretofore represented
                 by any such certificate have been acquired by a bona fide
                 purchaser, shall deliver to such person the certificate(s)
                 representing shares of NCBE Common Stock which such person
                 would have been entitled to receive upon surrender of each
                 such lost, wrongfully taken or destroyed certificate
                 representing shares of United Common Stock.

8.       Board of Directors.  The Board of Directors of NCBE as constituted at
         the time the Merger shall become effective and Janice L. Beesley shall
         serve as the Board of Directors of NCBE as the Surviving Corporation.
         The Board of Directors of NCBE will, at the time the Merger shall
         become effective, appoint and elect Janice L. Beesley as a Director of
         NCBE for the longest term available under NCBE's Articles of
         Incorporation and Bylaws.

9.       Discussions with Others.  United or its officers, directors or agents
         will not directly or indirectly, solicit, authorize, initiate or
         encourage submission of, any proposal, offer, tender offer or exchange
         offer from any person relating to any liquidation, dissolution,
         recapitalization, merger, consolidation or acquisition or purchase of
         all or a substantial portion of the assets or deposits of, or any
         material equity interest in, United or any of its wholly-owned
         subsidiaries or other similar transaction or business combination
         involving United or any of its wholly-owned subsidiaries while this
         Agreement is pending, unless





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         the Board of Directors of United shall have determined, after
         consultation with United's outside counsel, that there is a reasonable
         likelihood that the Board of Directors of United has a fiduciary duty
         to do so (or to authorize or direct the United's officers or agents to
         do so), (a) participate in any negotiations in connection with or in
         furtherance of any of the foregoing, (b) permit any person other than
         NCBE and its representatives to have any access to the facilities of,
         or (c) furnish to any person other than NCBE and its representatives
         any non-public information with respect to, United or any of its
         wholly-owned subsidiaries in connection with or in furtherance of any
         of the foregoing.  United shall promptly notify NCBE if any such
         proposal or offer, or any inquiry from or contact with any person with
         respect thereto, is made, and shall promptly provide NCBE with such
         information regarding the identity of the person making such proposal,
         offer, inquiry or contact as NCBE may reasonably request.  Nothing
         herein shall be deemed to prohibit United or its Board of Directors
         from complying with Rules 14d-9 and 14e-2 under the Securities
         Exchange Act of 1934 (the "1934 Act") or with any other applicable
         laws, regulations or directives of any public authority, or from
         making any disclosure to the United's shareholders which, in the
         judgment of its Board of Directors, may be required under applicable
         law.

10.      Undertakings of the Parties.  NCBE and United further agree as
         follows:

         (a)     Subject to the fiduciary duty of the United Board of
                 Directors, this Merger Agreement shall be submitted to the
                 shareholders of United and, if required, to the shareholders
                 of NCBE, for approval and adoption at separate meetings to be
                 called and held in accordance with law and the Articles or
                 Certificate of Incorporation and Bylaws of United and NCBE.

         (b)     NCBE and United will cooperate in the preparation of
                 applications to the Board of Governors of the Federal Reserve
                 System (the "Board") and The Office of Thrift Supervision (the
                 "OTS") and to any other state or federal regulatory agency
                 which may be required to facilitate the Merger.  For the
                 purpose (i) of holding meetings





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                 of shareholders of United and NCBE, if required, to approve
                 this Merger Agreement and the Merger and (ii) of registering
                 with the Securities and Exchange Commission ("SEC") and with
                 applicable state securities authorities the NCBE Common Stock
                 to be issued as contemplated by this Merger Agreement, the
                 parties hereto shall cooperate in the preparation of an
                 appropriate registration statement (such registration
                 statement, together with all and any amendments and
                 supplements thereto, being herein referred to as the
                 "Registration Statement"), which shall include a
                 prospectus/proxy statement satisfying all applicable
                 requirements of the Securities Act of 1933 (the "1933 Act"),
                 the 1934 Act, applicable state securities laws and the rules
                 and regulations thereunder (such prospectus/proxy statement,
                 together with any and all amendments or supplements thereto,
                 being herein referred to as the "Prospectus/Proxy Statement").
                 United shall have the right to review and approve such
                 Registration Statement prior to filing with the SEC.  NCBE
                 shall promptly file the Registration Statement with the SEC
                 and applicable state securities agencies.  NCBE shall use
                 reasonable efforts to cause the Registration Statement to
                 become effective under the 1993 Act and applicable state
                 securities laws at the earliest practicable date.  United
                 authorizes NCBE to utilize in the Registration Statement
                 information concerning United, its wholly-owned subsidiaries,
                 and its securities provided to NCBE for the purpose of
                 inclusion in the Prospectus/Proxy Statement.  NCBE shall
                 advise United promptly when the Registration Statement has
                 become effective and of any supplements or amendments thereto,
                 and NCBE shall furnish United with copies of all such
                 documents.  Prior to the time the Merger shall become
                 effective or the termination of this Merger Agreement, each
                 party shall consult with the other with respect to any
                 material (other than the Prospectus/Proxy Statement) that
                 might constitute a "prospectus" relating to the Merger within
                 the meaning of the 1933 Act.





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         (c)     Each party will assume and pay all of its fees and expenses
                 incurred by it incident to the negotiation, preparation and
                 execution of this Merger Agreement, obtaining of the requisite
                 regulatory and shareholder consents and approvals and all
                 other acts incidental to, contemplated by or in pursuance of
                 this Merger Agreement.  NCBE shall promptly prepare and file
                 at no expense to United:  (i) any and all required regulatory
                 applications necessary in connection with the transactions
                 contemplated by this Merger Agreement; and (ii) the
                 Registration Statement.  NCBE will also take any action
                 required to be taken under any applicable state securities or
                 "Blue Sky" laws in connection with the Merger.

         (d)     All information furnished by one party to another party in
                 connection with this Merger Agreement and the transactions
                 contemplated hereby will be kept confidential by such other
                 party and will be used only in connection with this Merger
                 Agreement and the transactions contemplated hereby, except to
                 the extent that such information:  (i) is already known to
                 such other party when received; (ii) thereafter becomes
                 lawfully obtainable from other sources; or (iii) is required
                 to be disclosed in any document filed with the SEC, the Board,
                 or any other governmental agency or authority (the
                 "Confidential Information").  In the event that this Merger
                 Agreement is terminated, each party will return to the other
                 party or destroy any documents received by it from the other
                 party that contain any such Confidential Information.

         (e)     After (i) receipt of the Board's and the OTS's prior approval,
                 (ii) the approval of the shareholders of United and, if
                 required NCBE, as provided in Section 10(a) has occurred; and
                 (iii) the regulatory waiting period(s) have expired, NCBE
                 shall designate the date as of which NCBE desires the Merger
                 to become effective and the time the Merger shall become
                 effective shall occur at the time and on the date so
                 designated, consistent with the terms of Section 4 hereof.
                 However, any date so specified shall not be later than either
                 (a) the first of the month immediately





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                 following the month in which the last of the events described
                 above (i-iii) occurs if said event occurs before the
                 twenty-first day of such month or (b) the first day of the
                 second month immediately following such month if the last of
                 the events described above occurs after the twentieth day of
                 such month.

         (f)     Subject to the terms and conditions of this Merger Agreement,
                 NCBE and United each agree that, subject to applicable laws
                 and, in the case of United only, to the fiduciary duties of
                 its Directors, each will promptly take or cause to be taken
                 all action, and promptly do or cause to be done all things
                 necessary, proper or advisable under applicable laws and
                 regulations to consummate and make effective the Merger and
                 other transactions contemplated by this Merger Agreement.

         (g)     As soon as practicable following the time the Merger shall
                 become effective,  eligible employees of United and United
                 Bank shall be entitled to participate in all employee benefit
                 plans of NCBE.  For purposes of eligibility and vesting in:
                 (i) the NCBE Employees' Profit Sharing Plan ("NCBE Profit
                 Plan") and, (ii) in the event of the merger of the Financial
                 Institutions Retirement Fund ("FIRF") pension plan sponsored
                 by United (the "United Pension Plan") with the NCBE's
                 Employees' Plan for Pensions (the "NCBE Pension Plan"), the
                 NCBE Pension Plan, employees of United and United Bank shall
                 be given credit for their years of service as employees of
                 United or United Bank.  Subject to the foregoing, and provided
                 that the United Pension Plan is merged with the NCBE Pension
                 Plan, employees of United and United Bank shall begin to
                 accrue credit for benefit accruals under the NCBE Pension Plan
                 at the earliest entry date (January 1 or July 1) following the
                 effective time of the Merger without offset or reduction for
                 the benefits they had accrued under the United Pension Plan.





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                 In the event that the United Pension Plan is terminated at the
                 direction of NCBE as hereinafter provided for, employees of
                 United shall, for purposes of eligibility, vesting and benefit
                 accrual under the NCBE Pension Plan, be considered new
                 employees of NCBE.  In the event that such employees shall not
                 commence accruing credit for benefit accrual purposes upon the
                 commencement of employment with NCBE, then they shall continue
                 to accrue benefits under the United Pension Plan  until such
                 time as they shall be entitled to commence the accrual of
                 benefits under the NCBE Pension Plan without offset or
                 reduction for the benefits they had accrued under the United
                 Pension Plan.

         (h)     At the request of NCBE, United shall, prior to the time the
                 Merger shall become effective, take such actions as shall be
                 necessary or desirable to cause the United Pension Plan and
                 the FIRF Thrift Plan sponsored by United and United Bank (the
                 "United 401(k) Plan") to be terminated at or after the
                 effective date of Merger and/or be merged with the NCBE
                 Pension Plan and the NCBE Profit Plan, respectively, in
                 accordance with the applicable requirements of ERISA.  In all
                 events, the United and United Bank employees who participate
                 in the United Pension Plan and/or the United 401(k) Plan shall
                 incur no reduction in their account balance or accrued benefit
                 or lose any rights or benefits they had accrued under the
                 United Pension Plan and/or the United 401(k) Plan prior to
                 such termination or merger.  In the event that the United
                 Pension Plan and the NCBE Pension Plan are not merged and
                 employees of United are considered new employees of NCBE on
                 the effective date of the Merger for purposes of determination
                 of eligibility and vesting under the NCBE Pension Plan, then
                 the United Pension Plan shall, subject to the provisions of
                 ERISA, be continued in effect for the employees of United and
                 United Bank (solely with respect to those persons employed as
                 of the effective date of the Merger) until such persons are





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                 eligible on the basis of length of service to accrue benefits
                 under the NCBE  Pension Plan on the same basis as the
                 employees of NCBE.

         (i)     Subject to the fiduciary duty of the NCBE Board of Directors,
                 NCBE undertakes to cause,  immediately after the effective
                 date of the Merger the continuance as Directors of United Bank
                 to January, 1996, with at least the same compensation and
                 benefits, subject to any retirement policies of NCBE or United
                 Bank as in effect as of the date of this Agreement, all those
                 persons serving as Directors of such bank immediately prior to
                 the effective time of the Merger, plus one additional person
                 to be named by NCBE may be added to the Board of Directors of
                 United Bank.

         (j)     NCBE will maintain "current public information" within the
                 meaning of Rule 144 for three (3) years following the
                 effective date.

         (k)     NCBE, United, and their Directors and Executive Officers shall
                 not cause any transactions in NCBE Common Stock during the 20
                 business days immediately preceding the effective date of the
                 Merger.

         (l)     NCBE shall assume and maintain the non-qualified deferred
                 compensation plan for the directors of United Bank who
                 currently participate in the aforesaid plan and shall permit
                 such directors who currently participate in such plan to
                 continue to defer their directors' fees on a tax-deferred
                 basis in the same amount currently being deferred until June
                 30, 1998.  After June 30, 1998, the amount of United Bank
                 directors' fees that had been deferred by Janice Beesley shall
                 be paid to her as part of her annual salary.

         (m)     NCBE shall, at such time as is recommended by its accountants,
                 McGladrey and Pullen, sell approximately 75,000 shares of its
                 common stock acquired by it during 1994, pursuant to its stock
                 repurchase program.  NCBE shall use its best efforts to cause
                 such sale to remove any "taint" attached to such shares which
                 taint may make pooling of interest accounting for the Merger
                 unavailable.





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         (n)     United shall use its best efforts to cause the termination of
                 the United Bank employment contacts with Janice L. Beesley, G.
                 Jeffrey Palmer and Patrick W. Lenahan at or immediately prior
                 to the effective time of the Merger.

11.      Dissenting Shareholders.  Holders of United Common Stock who do not
         vote their shares in favor of the Merger and otherwise comply in all
         respects to perfect dissenters' rights with respect to their shares
         ("Dissenting Shares"), will be entitled to dissenters' or appraisal
         rights, if any, pursuant to and solely upon strict compliance with,
         the applicable provisions of Delaware law.

12.      Tax Opinion.  NCBE, for the benefit of the United shareholders shall
         obtain a written opinion of Werner & Blank Co., L.P.A. to the effect
         that:

         (a)     The statutory merger of United with and into NCBE will
                 constitute a reorganization within the meaning of Section
                 368(a)(1)(A) of the Internal Revenue Code;

         (b)     No gain or loss will be recognized by United or NCBE as a
                 consequence of the transactions herein contemplated;

         (c)     No gain or loss will be recognized by the shareholders of
                 United on the exchange of their shares of United Common Stock
                 for shares of NCBE Common Stock (disregarding for this purpose
                 any cash received for fractional share interests to which they
                 may be entitled);

         (d)     The federal income tax basis of the NCBE Common Stock received
                 by the shareholders of United Common Stock for their shares of
                 United Common Stock will be the same as the federal income tax
                 basis of the United Common Stock surrendered in exchange
                 therefor; and

         (e)     The holding period of the NCBE Common Stock received by a
                 shareholder of United for his shares of United Common Stock
                 will include the period for which the United Common Stock
                 exchanged therefor was held, provided the exchanged





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                 United Common Stock was held as a capital asset by such
                 shareholder on the date of the exchange.

13.      Representations and Warranties of NCBE.  NCBE represents and warrants
         to United as follows:

         (a)     NCBE is a corporation duly organized and validly existing
                 under the laws of the State of Indiana, is a registered bank
                 holding company under the Bank Holding Company Act of 1956, as
                 amended, and is qualified to do business in the State of
                 Indiana, together with all other jurisdictions where it is
                 both required to so qualify and the failure to so qualify
                 would have a Material Adverse Effect on NCBE.  For purposes of
                 this Merger Agreement, the term "Material Adverse Effect"
                 means, with respect to either NCBE or United, any condition,
                 event, change or occurrence that has caused a material adverse
                 change in the business, operations, results of operations or
                 financial condition of such entity and its wholly-owned
                 subsidiaries on a consolidated basis, but shall not include
                 (i) an adverse change with respect to, or effect on, such
                 entity or its wholly-owned subsidiaries resulting from a
                 change in law, rule, regulation, generally accepted accounting
                 principles or regulatory accounting principles (as such would
                 apply to the financial statements of such entity), (ii) an
                 adverse change with respect to, or effect on, such entity
                 resulting from expenses incurred in connection with this
                 Agreement or the transactions contemplated hereby, or (iii) an
                 adverse change with respect to, or effect on, such entity or
                 its wholly-owned subsidiaries resulting from any other matter
                 affecting federally insured depository institutions or their
                 holding companies, regulated mortgage lenders or mortgage
                 originators generally, including (without limitation) judicial
                 decisions, changes in general economic conditions and changes
                 in prevailing interest and deposit rates.  NCBE has full power
                 and authority (including all licenses, franchises, permits and
                 other governmental authorizations which are legally required)
                 to engage in the





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                 businesses and activities now conducted by it.  As of
                 September 30, 1994, the authorized capital stock of NCBE
                 consisted of 5,000,000 shares of common stock, par value $3.33
                 1/3 per share of which a total of 3,693,254 shares were issued
                 and outstanding and no shares were held by NCBE as treasury
                 stock.  All of said shares of capital stock are fully paid and
                 nonassessable and are not issued in violation of the
                 preemptive rights of any shareholder.  There are no
                 outstanding options, warrants or commitments of any kind
                 relating to NCBE's capital stock.

         (b)     NCBE has furnished to United copies of the following financial
                 statements relating to NCBE and its consolidated subsidiaries:
                 (i) the audited Consolidated Balance Sheets of NCBE as of
                 December 31, 1993 and 1992 and the Consolidated Statements of
                 Income, Shareholders' Equity and Statements of Cash Flows for
                 the years ended December 31, 1993, 1992, and 1991, together
                 with the notes thereto, and (ii) the unaudited Consolidated
                 Balance Sheet of NCBE as of September 30, 1994, and the
                 unaudited Consolidated Statements of Income and Shareholders'
                 equity for the period then ended.  Each of the aforementioned
                 financial statements was prepared in accordance with generally
                 accepted accounting principles, consistently applied and is
                 true and correct in all material respects and together present
                 fairly the consolidated financial position and results of
                 operations of NCBE as of the dates and for the periods therein
                 set forth (subject, in the case of such interim financial
                 statements, to normal year-end audit adjustments and to the
                 absence of footnotes), except for the effect of the pending
                 acquisition of White County Bank, Carmi, Illinois, pursuant to
                 the terms of an Agreement and Plan of Reorganization dated
                 December 12, 1994.  Such financial statements do not, as of
                 the dates thereof, include any material asset or omit any
                 material liability, absolute or contingent, or other fact, the
                 inclusion or omission of which renders such financial
                 statements, in light of the circumstances under which they
                 were





                                       16
<PAGE>   17

                 made, misleading in any material respect.  Since December 31,
                 1993, NCBE has not suffered a Material Adverse Effect.

         (c)     The Board of Directors of NCBE has authorized execution of
                 this Merger Agreement and approved the merger of United and
                 NCBE as contemplated by this Merger Agreement.  NCBE has all
                 requisite power and authority to enter into this Merger
                 Agreement and NCBE has the authority to consummate the
                 transactions contemplated hereby.  This Merger Agreement
                 constitutes the valid and legally binding obligation of NCBE
                 and this Merger Agreement and the consummation hereof has been
                 duly authorized and approved on behalf of NCBE by all
                 requisite corporate action.  Provided the required approvals
                 are obtained from the Board and OTS, neither the execution and
                 delivery of this Merger Agreement nor the consummation of the
                 Merger will conflict with, result in the breach of, constitute
                 a default under or accelerate the performance provided by the
                 terms of any law, or any rule or regulation of any
                 governmental agency or authority or any judgment, order or
                 decree of any court or other governmental agency to which NCBE
                 may be subject, any contract, agreement or instrument to which
                 NCBE is a party or by which NCBE is bound or committed, or the
                 Articles of Incorporation or Bylaws of NCBE, or constitute an
                 event which with the lapse of time or action by a third party,
                 could, to the best of NCBE's knowledge, result in the default
                 under any of the foregoing or result in the creation of any
                 lien, charge or encumbrance upon any of the assets or
                 properties of NCBE or upon any of the stock of NCBE, except,
                 however, in the case of contracts, agreements or instruments,
                 such defaults, conflicts or breaches which either (i) will be
                 cured or waived prior to the time the Merger becomes
                 effective, or (ii) if not so cured or waived would not, in the
                 aggregate, have a Material Adverse Effect on NCBE.

         (d)     There is no litigation, action, suit, investigation or
                 proceeding pending or, to the best of its knowledge after due
                 inquiry of its executive officers, threatened,





                                       17
<PAGE>   18

                 against or affecting NCBE or its wholly-owned subsidiaries or
                 involving any of their respective properties or assets, at law
                 or in equity, before any federal, state, municipal, local or
                 other governmental authority, involving a material amount
                 which, if resolved adversely to the interest of NCBE or its
                 subsidiaries, would materially affect the consolidated
                 financial condition or operations of NCBE and its wholly-owned
                 subsidiaries or its ability to perform under this Merger
                 Agreement, and to the best of its knowledge and belief after
                 due inquiry of its executive officers, no one has asserted and
                 no one has reasonable or valid grounds on which it reasonably
                 can be expected that anyone will assert any such claims
                 against NCBE or its wholly-owned subsidiaries based upon the
                 wrongful action or inaction of NCBE or its subsidiaries or any
                 of their respective officers, directors or employees.

         (e)     At the time the Merger shall become effective and on such
                 subsequent date when the former shareholders of United
                 surrender their United share certificates for cancellation,
                 the shares of NCBE Common Stock to be received by shareholders
                 of United will have been duly authorized and validly issued by
                 NCBE, will be fully paid and nonassessable, and the
                 Registration Statement and all amendments with respect thereto
                 shall have been declared effective by the SEC with respect to
                 the shares of NCBE Common Stock to be received by the
                 shareholders of United.

         (f)     NCBE has not incurred and will not incur directly or
                 indirectly any liability for brokerage, finders', agents' or
                 investment bankers' fees or commissions in connection with
                 this Merger Agreement or the transactions contemplated
                 thereby.

         (g)     The Employees' Savings and Profit Sharing Plan of National
                 City Bancshares, Inc. and the Plan for Pensions of National
                 City Bancshares, Inc. (hereinafter referred to collectively as
                 the "plans") which purports to be a qualified plan under
                 Section 401(a) of the Internal Revenue Code is so qualified
                 and is in compliance in all material respects with the
                 applicable requirements of the Employee





                                       18
<PAGE>   19

                 Retirement Income Security Act of 1974, as amended ("ERISA").
                 All material notices, reports and other filings required under
                 applicable law to be given or made to or with any governmental
                 agency with respect to the plans have been timely filed or
                 delivered where failure to file will result in a penalty or
                 result in disqualification of the plan.  NCBE has no knowledge
                 either of any circumstances which would adversely affect the
                 qualifications of the plans or their compliance with the
                 applicable requirements of ERISA, or of any "reportable event"
                 (as such term is defined in Section 4043(b) of ERISA) or any
                 "prohibited transaction" (as such term is defined in Section
                 406 of ERISA and Section 4975(c) of the Internal Revenue Code)
                 which has occurred since the date on which said section became
                 applicable to the plans.  The plans which are defined benefit
                 plans within the meaning of ERISA meet the minimum funding
                 standards set forth in the Internal Revenue Code and ERISA.

         (h)     NCBE has filed all reports, forms and registration statements
                 (collectively, "SEC Documents") required to be filed by it
                 pursuant to the 1933 Act, as amended, and the 1934 Act, as
                 amended for periods ending after January 1, 1985, and such SEC
                 Documents complied in all material respects with the 1933 Act
                 and the 1934 Act and all applicable rules and regulations
                 promulgated thereunder (the "SEC Laws").  NCBE has delivered
                 to United copies of the Annual Report on Form 10-K filed with
                 the Securities and Exchange Commission by NCBE for its fiscal
                 years ended December 31, 1993, 1992, and 1991 including
                 exhibits and all documents incorporated by reference therein,
                 and the proxy materials disseminated by NCBE to its
                 shareholders in connection with the 1994 Annual Meeting of
                 Shareholders of NCBE; such Annual Report and proxy materials
                 do not misstate a material fact or omit to state a material
                 fact necessary in order to make the statements contained
                 therein, in light of the circumstances under which they are
                 made, not misleading.





                                       19
<PAGE>   20

         (i)     Since December 31, 1993, each of NCBE and its subsidiaries has
                 conducted business only in the ordinary course, and has
                 preserved its corporate existence, business and goodwill
                 intact, except for the sale during 1994, by NCBE of its
                 interest in its non-bank subsidiary, Ayer-Wagoner-Deal
                 Insurance Agency, Inc., and the merger of two of its wholly
                 owned subsidiary banking corporations, namely, Poole Deposit
                 Bank and Farmers State Bank, which merger was effective
                 December 1, 1994.

         (j)     NCBE and the NCBE Banks each have good and marketable title to
                 all assets and properties, whether real or personal, tangible
                 or intangible, including without limitation the capital stock
                 of the NCBE Banks and all other assets and properties
                 reflected as owned by it or them in NCBE's Balance Sheet of
                 September 30, 1994, or acquired subsequent thereto (except to
                 the extent that such assets and properties have been disposed
                 of for fair value in the ordinary course of business since
                 September 30, 1994) subject to no liens, mortgages, security
                 interests, encumbrances, pledges or charges of any kind,
                 except:  (i) those items that secure liabilities that are
                 reflected in said Balance Sheet; (ii) statutory liens for
                 taxes not yet delinquent; and (iii) minor defects and
                 irregularities in title and encumbrances which do not
                 materially impair the use thereof for the purposes for which
                 they are held; and such liens, mortgages, security interests,
                 encumbrances and charges which are not in the aggregate,
                 material to the assets and properties of NCBE.  NCBE or the
                 NCBE Banks as lessee has the contractual right under valid
                 leases to occupy, use, possess and control all material
                 property leased by NCBE or the NCBE Banks.

         (k)     To the best of its knowledge after due inquiry of its
                 executive officers, NCBE and the NCBE Banks have complied with
                 all laws, regulations and orders applicable to them and to the
                 conduct of their businesses, including without limitation, all
                 statutes, rules and regulations pertaining to the conduct of
                 banking activities





                                       20
<PAGE>   21

                 except for possible technical violations which together with
                 any penalty which results therefrom are or will be of no
                 material consequence to either NCBE or the NCBE Banks.
                 Neither NCBE nor any of the NCBE Banks are the subject of, nor
                 a party to, any regulatory action or agreement such as letter
                 agreements, memorandum of understanding, cease and desist
                 orders or like agreements.  Neither NCBE nor the NCBE Banks
                 are in default under, and no event has occurred which, with
                 the lapse of time or action by a third party, could, to the
                 best of NCBE's knowledge after due inquiry of its executive
                 officers, result in the default under the terms of any
                 judgment, decree, order, writ, rule or regulation of any
                 governmental authority or court, whether federal, state or
                 local and whether at law or in equity, where the default(s)
                 could reasonably be expected to have a Material Adverse Effect
                 on NCBE.

         (l)     NCBE has duly filed all federal, state, county and local
                 income, excise, real and personal property and other tax
                 returns and reports (including, but not limited to, social
                 security, withholding, unemployment insurance, and sales and
                 use taxes) required to have been filed by NCBE up to the date
                 hereof (excluding any return or report for which a current
                 valid extension is in effect.  To the best of the knowledge
                 and belief of NCBE after due inquiry of its executive
                 officers, all such returns are true and correct in all
                 material respects, and NCBE has paid or, prior to the time the
                 Merger shall become effective, will pay all taxes, interest
                 and penalties shown on such return or reports or claimed
                 (other than those claims being contested in good faith and
                 which have been disclosed to United) to be due to any federal,
                 state, county, local or other taxing authority, and there is,
                 and at the time the Merger shall become effective will be, no
                 basis known to the executive officers of NCBE for any
                 additional claim or assessment which might result in a
                 Material Adverse Effect on NCBE, and for which an adequate
                 reserve has not been established.  To the best of its
                 knowledge and belief after due inquiry of its





                                       21
<PAGE>   22

                 executive officers, NCBE has paid or made adequate provision
                 in its financial statements or its books and records for all
                 taxes payable in respect of all periods ending as of the date
                 thereof.  To the best of its knowledge and belief after due
                 inquiry of its executive officers, NCBE has, or at the time
                 the Merger shall become effective will have, no material
                 liability for any taxes, interest or penalties of any nature
                 whatsoever, except for those taxes which may have arisen up to
                 the time the Merger shall become effective in the ordinary
                 course of business and are properly accrued on the books of
                 NCBE as of the time the Merger shall become effective.

         (m)     To the best of its knowledge and belief, but without having
                 undertaken an environmental audit or investigation, NCBE has
                 no knowledge of any underground storage tanks, any hazardous
                 substances, hazardous waste, pollutant or contaminant,
                 including, but not limited to, asbestos (except as previously
                 disclosed to United in a letter of even date herewith), PCB's
                 or urea formaldehyde, having been generated, released into,
                 stored or deposited over, upon or below (in storage tanks or
                 otherwise) any real property currently or to be owned or
                 leased by NCBE or any of its wholly-owned subsidiaries, or
                 into any water systems on or below the surface any real
                 property currently or to be owned or leased by NCBE or any of
                 its wholly-owned subsidiaries from any source whatsoever.  As
                 used in this Merger Agreement, the terms "hazardous
                 substance," "hazardous waste," "pollutant" and "contaminant"
                 mean any substance, waste pollutant or contaminant included
                 within such terms under any applicable Federal, state or local
                 statute or regulation.

         (n)     NCBE and the NCBE Banks have in effect insurance coverage with
                 reputable insurance underwriters, which in respect of amounts,
                 premiums, types and risksinsured, constitutes reasonably
                 adequate coverage against all risks





                                       22
<PAGE>   23

                 customarily insured against by companies comparable in size
                 and operation to NCBE and the NCBE Banks.





                                       23
<PAGE>   24


14.      Representations and Warranties of United.  United represents and
         warrants to NCBE as follows:

         (a)     United is a corporation duly organized and validly existing in
                 good standing under the laws of the State of Delaware, is a
                 registered savings and loan holding company under the Home
                 Owners' Loan Act, as amended.  United has full power and
                 authority (including all licenses, franchises, permits and
                 other governmental authorizations which are legally required)
                 to engage in the businesses and activities now conducted by
                 it.  As of the date of this Merger Agreement, the authorized
                 capital stock of United consists of; (i)  2,000,000 shares of
                 common stock with $.01 par value, of which a total of 440,712
                 shares are issued and outstanding and  of which 19,288 are
                 shares of treasury stock owned by United, and (ii) 500,000
                 shares of preferred stock, none of which are either issued and
                 outstanding or are shares of treasury stock owned by United.
                 All of said shares of capital stock are fully paid and
                 nonassessable and are not issued in violation of the
                 preemptive rights of any shareholder.  There are no
                 outstanding options, warrants or commitments of any kind
                 relating to United's capital stock except options to purchase
                 26,698 shares of United Common Stock at a price of $10.00 per
                 share issued pursuant to United's 1992 Stock Option and
                 Incentive Plan adopted in 1992.

         (b)     United has furnished to NCBE copies of all its audited
                 financial statements relating to United and its subsidiaries,
                 as of June 30, 1994 and 1993 and for each of the fiscal years
                 ended June 30, 1994, 1993, and 1992.  United has furnished to
                 NCBE copies of all financial statements relating to United and
                 its subsidiaries, as filed with the appropriate regulatory
                 agencies, as of and for the interim period ended September 30,
                 1994.  Each of the aforementioned financial statements is
                 prepared in accordance with generally accepted accounting
                 principles or





                                       24
<PAGE>   25

                 applicable regulatory accounting principles applicable to the
                 United Bank, consistently applied and is true and correct in
                 all material respects and together present fairly the
                 consolidated financial position and results of operations of
                 United as of the dates and for the periods therein set forth
                 (subject, in the case of such interim financial statements, to
                 normal year-end adjustments and the absence of footnotes).
                 Such financial statements do not, as of the dates thereof,
                 include any material asset or omit any material liability,
                 absolute or contingent, or other fact, the inclusion or
                 omission of which renders such financial statements, in light
                 of the circumstances under which they were made, misleading in
                 any material respect, except for certain contingent
                 liabilities which are disclosed in United's letter to NCBE of
                 even date herewith.  Since June 30, 1994, United has not
                 suffered a Material Adverse Effect.

         (c)     The Board of Directors of United has authorized execution of
                 this Merger Agreement.  Subject to the approval by the OTS and
                 the shareholders of United, United has all requisite power and
                 authority to enter in this Merger Agreement.  United owns all
                 of the shares of United Bank.  United has the authority to
                 consummate the transactions contemplated hereby, provided all
                 required corporate and regulatory approvals are obtained, so
                 that neither the execution and delivery of this Merger
                 Agreement nor the consummation of the Merger will conflict
                 with, result in the breach of, constitute a default under or
                 accelerate the performance provided by the terms of any law,
                 or any rule or regulation of any governmental agency or
                 authority or any judgment, order or decree of any court or
                 other governmental agency to which United may be subject, any
                 contract, agreement or instrument to which United is a party
                 or by which United is bound or committed, or the Certificate
                 of Incorporation or Bylaws of United, or constitute an event
                 which with the lapse of time or action by a third party,
                 could, to the best of United's knowledge, result in the
                 default under any of the foregoing





                                       25
<PAGE>   26

                 or result in the creation of any lien, charge, encumbrance
                 upon any of the assets, property or capital stock of United,
                 except, however, in the case of contracts, agreements or
                 instruments, such defaults, conflicts or breaches which either
                 (i) will be cured or waived prior to the time the Merger
                 becomes effective, or (ii) if not so cured or waived would
                 not, in the aggregate, have a Material Adverse Effect on
                 United.

         (d)     Other than as disclosed on the United Document List there is
                 no litigation, action, suit, investigation or proceeding
                 pending or, to the best of its knowledge after due inquiry of
                 its executive officers, overtly threatened, against or
                 affecting United or its wholly-owned subsidiaries or involving
                 any of their respective properties or assets, at law or in
                 equity, before any federal, state, municipal, local or other
                 governmental authority, involving a material amount which, if
                 resolved adversely to the interest of United would materially
                 affect the consolidated financial condition or operations of
                 United and its wholly-owned subsidiaries on a consolidated
                 basis, and/or its ability to perform under this Merger
                 Agreement, and to the best of its knowledge and belief after
                 due inquiry its executive officers, no one has asserted and no
                 one has reasonable or valid ground on which it reasonably can
                 be expected that anyone will assert any such claims against
                 United or its wholly-owned subsidiaries based upon the
                 wrongful action or inaction of United or its subsidiaries or
                 any of their respective officers, directors or employees.

         (e)     Each of United and its wholly owned subsidiaries have good and
                 marketable title to all assets and properties, whether real or
                 personal, tangible or intangible, including without limitation
                 the capital stock of its wholly-owned subsidiaries and all
                 other assets and properties reflected as owned by it or them
                 in United's Balance Sheet of September 30, 1994, or acquired
                 subsequent thereto (except to the extent that such assets and
                 properties have been disposed of for fair value in the
                 ordinary course of business since September 30, 1994) subject
                 to no liens, mortgages,





                                       26
<PAGE>   27

                 security interests, encumbrances, pledges or charges of any
                 kind, except: (i) those items that secure liabilities that are
                 reflected in said Balance Sheet; (ii) statutory liens for
                 taxes not yet delinquent; and (iii) minor defects and
                 irregularities in title and encumbrances which do not
                 materially impair the use thereof for the purposes for which
                 they are held; and such liens, mortgages, security interests,
                 encumbrances and charges are not in the aggregate, material to
                 the assets and properties of United on a consolidated basis.
                 Each of United and its wholly-owned subsidiaries, as lessee
                 has the contractual right under valid leases to occupy, use,
                 possess and control all material property leased by them.

         (f)     To the best of its knowledge after due inquiry of United and
                 its executive officers, United and its wholly-owned
                 subsidiaries have complied with all laws, regulations and
                 orders applicable to them and to the conduct of their
                 businesses, including without limitation, all statutes, rules
                 and regulations pertaining to the conduct of United Bank
                 banking activities except for possible technical violations
                 which together with any penalty which results therefrom are or
                 will be of no material consequence to United and its
                 wholly-owned subsidiaries.  Neither United nor any of its
                 wholly-owned subsidiaries is the subject of nor a party to,
                 any regulatory actions or agreement such as letter agreements,
                 memorandum of understanding, cease and desist order or like
                 agreements.  United and its wholly-owned subsidiaries are not
                 in default under, and no event has occurred which, with the
                 lapse of time or action by a third party, could, to the best
                 of United's knowledge after due inquiry of its executive
                 officers, result in the default under the terms of any
                 judgment, decree, order, writ, rule or regulation of any
                 governmental authority or court, whether federal, state or
                 local and whether at law or in equity, where the default(s)
                 could reasonably be expected to have a Material Adverse Effect
                 on United.





                                       27
<PAGE>   28

         (g)     Except as disclosed in United's letter to NCBE of even date
                 herewith, receipt of which is acknowledged by NCBE, United has
                 not, since September 30, 1994, to the date hereof:  (i) issued
                 or sold any of its capital stock or any corporate debt
                 securities; (ii) granted any option for the purchase of
                 capital stock; (iii) declared or set aside or paid any
                 dividend or other distribution in respect of its capital stock
                 except as permitted pursuant to the terms of this agreement
                 or, directly or indirectly, purchased, redeemed or otherwise
                 acquired any shares of such stock; (iv) incurred any
                 obligation or liability (absolute or contingent), except for
                 obligations reflected in this Merger Agreement and for
                 obligations or liabilities incurred in the ordinary course of
                 business; (v) mortgaged, pledged or voluntarily subjected to
                 lien or encumbrance (other than statutory liens for taxes not
                 yet delinquent) any of its assets or properties; (vi)
                 discharged or satisfied any material lien or encumbrance or
                 paid any material obligation or liability (absolute or
                 contingent), other than the current portion of any long term
                 liabilities which became due after September 30, 1994, current
                 liabilities included in its financial statements as of
                 September 30, 1994, current liabilities incurred since the
                 date thereof in the ordinary course of business and
                 liabilities incurred in carrying out the transactions
                 contemplated by this Merger Agreement; (vii) sold, exchanged
                 or otherwise disposed of any of its material capital assets
                 outside the ordinary course of business; (viii) made any
                 extraordinary officers' salary increase or wage increase,
                 entered into any employment contract with any officer or
                 salaried employee or, instituted any employee welfare, bonus,
                 stock option, profit-sharing, retirement or similar plan or
                 arrangement; (ix) suffered any damage, destruction or loss,
                 whether or not covered by insurance, materially and adversely
                 affecting its business, property or assets or waived (except
                 for fair consideration) any rights of value which are material
                 in the aggregate, considering its business taken as a whole;
                 or (x) entered or agreed to enter into any agreement or
                 arrangement





                                       28
<PAGE>   29

                 granting any preferential right to purchase any of its assets,
                 properties or rights or requiring the consent of any party to
                 the transfer and assignment of any material portion of such
                 assets, properties or rights.

         (h)     Except as set forth in the United Document List attached to
                 United's letter to NCBE of even date herewith, receipt of
                 which is acknowledged by NCBE, neither United nor any of its
                 wholly-owned subsidiaries is a party to or bound by any
                 written or oral: (i) employment or consulting contract which
                 is not terminable by it on 60 days or less notice, (ii)
                 employee bonus, deferred compensation, pension, stock bonus or
                 purchase, profit-sharing, retirement or stock option plan,
                 (iii) other employee benefit or welfare plan, or (iv) other
                 executory material agreements which in any case obligate it to
                 make any payment(s) which in the aggregate exceed $10,000 per
                 year except for contracts terminable on 60 days notice.  All
                 such pension, stock bonus or purchase, profit-sharing, defined
                 benefit and retirement plans set forth under the caption
                 "Qualified Plans" in the United Document List (hereinafter
                 referred to collectively as the "plan") are qualified plans
                 under Section 401(a) of the Internal Revenue Code and in
                 compliance in all material respects with ERISA.  All material
                 notices, reports and other filings required under applicable
                 law to be given or made to or with any governmental agency
                 with respect to the plans have been timely filed or delivered
                 where failure to file would result in a penalty of $25,000
                 and/or result in disqualification of the plan.  United has no
                 knowledge either of any circumstances which would adversely
                 affect the qualification of the plans or their compliance with
                 ERISA, or of any unreported "reportable event" (as such term
                 is defined in Section 4043(b) of ERISA) or, except as
                 indicated in the United Document List attached to United's
                 letter to NCBE of even date herewith, any "prohibited
                 transaction" (as such term is defined in Section 406 of ERISA
                 and Section 4975(c) of the Internal Revenue Code) which has
                 occurred since the date on which said sections became





                                       29
<PAGE>   30

                 applicable to the plans.  Each plan that is a defined benefit
                 pension plan meets the minimum funding standards set forth in
                 the Internal Revenue Code and ERISA.

         (i)     United has duly filed all federal, state, county and local
                 income, excise, real and personal property and other tax
                 returns and reports (including, but not limited to, social
                 security, withholding, unemployment insurance, and sales and
                 use taxes) required to have been filed by United up to the
                 date hereof (excluding any return or report for which a
                 current valid extension is in effect).  Except as set forth in
                 United's letter to NCBE of even date herewith, receipt of
                 which  is acknowledged by NCBE, to the best of the knowledge
                 and belief of United after due inquiry of its executive
                 officers, all such returns are true and correct in all
                 material respects, and United has paid or, prior to the time
                 the Merger shall become effective, will pay all  taxes,
                 interest and penalties shown on such return or reports or
                 claimed (other than those claims being contested in good faith
                 and which have been disclosed to NCBE) to be due to any
                 federal, state, county, local or other taxing authority, and
                 there is, and at the time the Merger shall become effective
                 will be, no basis known to the executive officers of United
                 for any additional claim or assessment which might result in a
                 Material Adverse Effect on United and for which an adequate
                 reserve has not been established.  To the best of its
                 knowledge and belief after due inquiry of its executive
                 officers, United has paid or made adequate provision in its
                 financial statements or its books and records for  all taxes
                 payable in respect of all periods ending as of the date
                 thereof.  To the best of its knowledge and belief after due
                 inquiry of its executive officers, United has, or at the time
                 the Merger shall become effective will have, no material
                 liability for any taxes, interest or penalties of any nature
                 whatsoever, except for those taxes which may have arisen up to
                 the time the Merger shall become effective in the ordinary
                 course of business and are properly accrued on the books of
                 United as of the time the Merger shall become effective.





                                       30
<PAGE>   31

         (j)     To the best of its knowledge and belief, but without having
                 undertaken an environmental audit or investigation, United has
                 no knowledge of any underground storage tanks, any hazardous
                 substances, hazardous waste, pollutant or contaminant,
                 including, but not limited to, asbestos (except as previously
                 disclosed to NCBE in a letter of even date herewith), PCB's or
                 urea formaldehyde, having been generated, released into,
                 stored or deposited over, upon or below (in storage tanks or
                 otherwise) any real property currently or to be owned or
                 leased by United or any of its wholly-owned subsidiaries, or
                 into any water systems on or below the surface any real
                 property currently or to be owned or leased by United or any
                 of its wholly-owned subsidiaries from any source whatsoever.

         (k)     United or United Bank has in effect insurance coverage with
                 reputable insurance underwriters, which in respect of amounts,
                 premiums, types and risks in insured, constitutes reasonably
                 adequate coverage against all risks customarily insured
                 against companies comparable in size and operation to United
                 or United Bank.

         (l)     Except as set forth in the United Document List, United has
                 not incurred and will not incur any liability for brokerage,
                 finders', agents', or investment bankers' fees or commissions
                 in connection with this Merger Agreement or the transactions
                 contemplated hereby.

15.      Action by United Pending Effective Time.  United agrees that from the
         date of this Merger Agreement until the time the Merger shall become
         effective or this Merger Agreement is properly terminated, except with
         prior written permission of NCBE:

         (a)     United will not declare or pay any dividends or make any
                 distributions other than regular cash dividends, payable at
                 such times and in amounts consistent with past practice and
                 not to exceed the per share rate paid in the prior calendar
                 year, provided, however, that shareholders of United may for
                 any given quarter, receive a dividend attributable to that
                 quarter only from NCBE or United, but not from both.  NCBE and
                 United agree to cooperate to coordinate the record and payment





                                       31
<PAGE>   32

                 dates of their cash dividend for the quarter in which the
                 Merger becomes effective so that the United shareholders
                 receive a quarterly dividend from either United or NCBE but
                 not from both with respect to such quarter. If, prior to the
                 consummation of the Merger, United shall declare a stock
                 dividend or make distributions upon or subdivide, split up,
                 reclassify or combine its shares of common stock in any
                 security convertible into its common stock, appropriate
                 adjustment or adjustments will be made in the foregoing per
                 share dividend rate.

         (b)     United will not issue, sell, grant any option for, or acquire
                 for value any shares of its capital stock or otherwise effect
                 any change in connection with its capitalization except in
                 connection with the exercise of stock options which are
                 outstanding on the date hereof.

         (c)     Except as otherwise set forth in or contemplated by this
                 Merger Agreement, United will use its best efforts to (i)
                 carry on its businesses in substantially the same manner as
                 heretofore conducted; (ii) keep in full force and effect
                 insurance comparable in amount and scope of coverage to that
                 now maintained by it; and (iii) maintain and preserve its
                 business organization intact.

         (d)     United will not:  (i) enter into any transaction other than in
                 the ordinary course of business or voluntarily incur or agree
                 to incur any material obligation or liability except
                 liabilities incurred and obligations entered into in the
                 ordinary course of business; (ii) change its or United Bank's
                 lending, investment, liability management and other material
                 United Bank banking policies in any material respect except in
                 accordance with prudent banking practices after consultation
                 with NCBE; (iii) except for customary periodic increases
                 consistent with prior practice, grant any individual, general
                 or uniform increase in the rates of pay of employees or make
                 any significant increase in its staff size; (iv) incur or
                 commit to any capital expenditures other than (x) in the
                 ordinary course of business (which in no event shall include
                 the establishment of new branches and such other





                                       32
<PAGE>   33

                 facilities or any capital expenditures for any purpose which
                 exceed 1% of United's combined capital, surplus and undivided
                 profit accounts as of June 30, 1994) or (y) in connection with
                 emergency repairs or replacements; or (v) permit any other
                 corporation to be merged or consolidated with and into it or
                 acquire all of the assets of any other corporation or person.

         (e)     United will not change its methods of accounting in effect at
                 June 30, 1994, except as required by changes in generally
                 accepted or regulatory accounting principles and concurred in
                 by United's independent auditors, or change any of its methods
                 of reporting income and deductions for Federal income tax
                 purposes from those employed in the preparation of United's
                 Federal income tax returns for the taxable year ending June
                 30, 1994, except for changes required by law.

         (f)     United will afford NCBE, its officers and other authorized
                 representatives, reasonable access to all books, records, tax
                 returns, leases, contracts and documents of United and its
                 wholly-owned subsidiaries and will furnish to NCBE such
                 information with respect to the assets and business of United
                 and its wholly-owned subsidiaries as NCBE may from time to
                 time reasonably request in connection with this Merger
                 Agreement and the transactions contemplated hereby.

         (g)     United will promptly advise NCBE in writing of all material
                 actions taken by the directors and shareholders of United,
                 furnish NCBE with copies of all interim financial statements
                 of United as they become available, and keep NCBE fully
                 informed concerning all developments which in the opinion of
                 United may have a material effect upon the business,
                 properties or condition (either financial or otherwise) of
                 United.





                                       33
<PAGE>   34


16.      Action by NCBE Pending Effective Time.  NCBE agrees that from the date
         of this Agreement until the time the Merger shall become effective or
         this Merger Agreement is properly terminated:

         (a)     NCBE will carry on its business in substantially the same
                 manner as heretofore conducted except as otherwise set forth
                 in or contemplated by this Merger Agreement,  and NCBE will
                 keep in full force and effect insurance comparable in amount
                 and scope of coverage to that now maintained by it and use its
                 best efforts to maintain and preserve its business
                 organization intact.  United acknowledges that, in the
                 ordinary course of its business as a bank holding company,
                 NCBE from time-to-time, enters into an agreement(s) to acquire
                 by merger, stock purchase or like means, another financial
                 institution or its holding company.

         (b)     NCBE will not change its methods of accounting in effect at
                 December 31, 1993, except as required by changes in generally
                 accepted or regulatory accounting principles as concurred in
                 by NCBE's independent auditors, or change any of its methods
                 of reporting income and deductions for Federal income tax
                 purposes from those employed in the preparation of the Federal
                 income tax returns of NCBE Banks for the taxable year ending
                 December 31, 1993, except for changes required by law or take
                 any action which could jeopardize the tax free nature of the
                 Merger or the pooling of interests accounting treatment for
                 the Merger.

         (c)     NCBE will promptly advise United in writing of all material
                 corporate actions taken by the directors of NCBE, furnish
                 United with copies of interim financial statements of NCBE and
                 all reports, schedules and statements filed by or delivered to
                 NCBE pursuant to the 1934 Act and the rules and regulations
                 promulgated thereunder, as they become available, and keep
                 United fully informed concerning all developments which in the
                 opinion of NCBE may have a





                                       34
<PAGE>   35

                 material effect upon the business, properties or condition
                 (either financial or otherwise) of NCBE.

         (d)     NCBE will afford United, its officers and other authorized
                 representatives, reasonable access to all books, records, tax
                 returns, leases, contracts and documents of NCBE and its
                 wholly-owned subsidiaries and will furnish to United such
                 information with respect to the assets and business of NCBE
                 and its wholly-owned subsidiaries as United may from time to
                 time reasonably request in connection with this Merger
                 Agreement and the transactions contemplated hereby.

         (e)     NCBE shall knowingly take no action, nor knowingly fail to
                 take any action which reasonably may be taken by it, to
                 prevent or disqualify the Merger from being accounted for as a
                 pooling of interests.

17.      Notification of Certain Matters.

         (a)     Each party shall give prompt notice to the other party of (i)
                 the occurrence or failure to occur of any event or the
                 discovery of any information, which occurrence, failure or
                 discovery would be likely to cause any representation or
                 warranty on its part contained in this Merger Agreement to be
                 untrue, inaccurate or incomplete in any material respect after
                 the date hereof or, in case of any representation or warranty
                 given as of a specific date, would be likely to cause any such
                 representation on its part contained in this Merger Agreement
                 to be untrue, inaccurate or incomplete in any material respect
                 as of such specific date and (ii) any material failure of such
                 party to comply with or satisfy any covenant or agreement to
                 be complied with or satisfied by it hereunder.

         (b)     From time to time prior to the time the Merger shall become
                 effective, each party shall promptly supplement or amend any
                 of its representations and warranties which apply to the
                 period after the date hereof by delivering a letter to the
                 other party with respect to any matter hereafter arising which
                 would render any such representation or warranty after the
                 date of this Merger Agreement materially





                                       35
<PAGE>   36

                 inaccurate or incomplete as a result of such matter arising.
                 Such supplement or amendment to a party's representations and
                 warranties contained in any such letter shall be deemed to
                 have modified the representations and warranties of the
                 disclosing party, and no such supplement or amendment, or the
                 information contained in any such letter, shall constitute a
                 breach of a representation or warranty of the disclosing
                 party; provided that no such supplement or amendment may cure
                 any breach of a covenant or agreement of a party.  Within 20
                 days after receipt of such supplement or amendment (or if cure
                 is promptly commenced by the disclosing party, but is not
                 effected within the Cure Period (as defined below)), the
                 receiving party may exercise its right to terminate this
                 Agreement pursuant to Section 27(e) hereof if the information
                 in such supplement or amendment together with the information
                 in any or all of the supplements or amendments previously
                 provided by the disclosing party indicate that the disclosing
                 party has suffered or is reasonably likely to suffer a
                 Material Adverse Effect which either has not or cannot be
                 cured within 30 days after disclosure to the receiving party
                 (the "Cure Period").

18.      Affiliate Letters.  United shall obtain and deliver to NCBE as
         promptly as practicable after (and shall use its reasonable best
         efforts to obtain and deliver within five days after) the date hereof
         a signed representation letter substantially in the form of Exhibit A
         hereto from each executive officer and director of United and each
         shareholder of United who may reasonably be deemed an "affiliate" of
         United within the meaning of such term as used in Rule 145 under the
         1933 Act and for purposes of qualifying for pooling of interests
         accounting treatment for the Merger, and shall obtain and deliver to
         NCBE a signed representation letter substantially in the form of
         Exhibit A from any person who becomes an executive officer or director
         of United or any shareholder who becomes such an "affiliate" after the
         date hereof as promptly as practicable after (and shall use its
         reasonable best efforts to obtain and deliver within five days after)
         such person achieves





                                       36
<PAGE>   37

         such status.  NCBE shall likewise use its best efforts to secure
         letters or commitments from its affiliates to satisfy
         pooling-of-interest accounting requirements.

19.      Indemnification

         (a)     From and after the time the Merger becomes effective, NCBE
                 shall indemnify, defend and hold harmless each person who is
                 now, or has been at any time prior to the date hereof or who
                 becomes prior to the time the Merger becomes effective, an
                 officer, director, employee or agent of Untied or any of its
                 wholly-owned subsidiaries (the "Indemnified Parties") against
                 all losses, claims, damages, costs, expenses (including
                 attorney's fees), liabilities or judgments or amounts that are
                 paid in settlement (which settlement shall require the prior
                 written consent of NCBE, which consent shall not be
                 unreasonably withheld) of or in connection with any claim,
                 action, suit, proceeding or investigation (a "Claim") in which
                 an Indemnified Party is, or is threatened to be made, a party
                 or a witness based in whole or in part on or arising in whole
                 or in part out of the fact that such person is or was a
                 director, officer, employee or agent of United or any of its
                 wholly-owned subsidiaries if such Claim pertains to any matter
                 or fact arising, existing or occurring on or prior to the time
                 the Merger shall become effective (including, without
                 limitation, the Merger and other transactions contemplated by
                 this Merger Agreement), regardless of whether such Claim is
                 asserted or claimed prior to, at or after the time the Merger
                 shall become effective (the "Indemnified Liabilities") to the
                 fullest extent permitted by NCBE's Articles of Incorporation
                 and Bylaws or applicable law whichever shall be greater.  Any
                 Indemnified Party wishing to claim indemnification under this
                 Section 19(a), upon learning of any Claim, shall notify NCBE
                 (but the failure so to notify NCBE shall not relieve it from
                 any liability which NCBE may have under this Section 19(a)
                 except to the extent such failure prejudices NCBE) and shall
                 be entitled to receive advances of costs and expenses from
                 NCBE upon delivery to NCBE of any undertaking required by





                                       37
<PAGE>   38

                 applicable law relating to the obligation of the Indemnified
                 Party to reimburse NCBE for such advances in certain
                 circumstances.  The obligations of NCBE described in this
                 Section 19(a) shall continue in full force and effect, without
                 any amendment thereto, for a period of not less than six years
                 from the time the Merger shall become effective; provided,
                 however, that all rights to indemnification in respect of any
                 Claim asserted or made within such period shall continue until
                 the final disposition of such Claim; and provided further that
                 nothing in this Section 19(a) shall be deemed to modify
                 applicable law regarding indemnification of former officers
                 and directors.

         (b)     From and after the time the Merger shall become effective, the
                 directors, officers and employees of United or any of its
                 wholly-owned subsidiaries who become directors, officers or
                 employees of NCBE or any NCBE wholly-owned subsidiary
                 including United Bank, shall also have indemnification rights
                 with prospective application.  The prospective indemnification
                 rights shall consist of such rights to which directors,
                 officers and employees of NCBE are entitled under the
                 provisions of the Articles of Incorporation, Bylaws or similar
                 governing documents of NCBE and the NCBE wholly-owned
                 subsidiaries, as in effect from time to time after the time
                 the Merger becomes effective, as applicable, and provisions of
                 applicable law as in effect from time to time after the time
                 the Merger shall become effective.

         (c)     If requested by United at any time prior to the effective time
                 of the Merger, from and after the effective time of the
                 Merger, NCBE shall use its best efforts to cause United Bank
                 and any successor thereto to maintain directors and officers
                 liability insurance comparable to that being maintained by
                 United Bank on the date hereof, or continue the existing
                 insurance being maintained by United Bank, for the benefit of
                 the current and former directors and officers of United Bank
                 for a period of at least three years after the time the Merger
                 becomes effective, which





                                       38
<PAGE>   39

                 insurance shall provide coverage for acts and omission
                 occurring on or prior to the time the Merger shall become
                 effective; provided, further, that officers and directors of
                 United Bank may be required to make application and provide
                 customary representations and warranties to NCBE's or United
                 Bank's insurance carrier for the purpose of obtaining such
                 insurance.

         (d)     The contractual obligations of NCBE provided under Sections
                 19(a), 19(b) and 19(c) hereof are intended to benefit, and be
                 enforceable against NCBE directly by, the Indemnified Parties,
                 and shall be binding on all successors of NCBE.

20.      Conditions to Obligations of NCBE.  The obligations of NCBE under this
         Merger Agreement are subject, unless waived by NCBE, to the
         satisfaction of the following conditions on or prior to the time the
         Merger shall become effective:

         (a)     There shall not have been occurred an event or series of
                 events which has resulted or is likely to result in a Material
                 Adverse Effect on United from September 30, 1994, to the time
                 the Merger shall become effective.

         (b)     United shall not have paid cash dividends from the date hereof
                 to the time the Merger shall become effective except as
                 permitted under section 15(a) this Merger Agreement.

         (c)     All representations by United contained in this Merger
                 Agreement shall be true in all material respects at, or as of,
                 the time the Merger shall become effective as though such
                 representations were made at and as of said date, except for
                 changes contemplated by the Merger Agreement and except also
                 for representations as of a specified time other than the time
                 the Merger shall become effective, which shall be true in all
                 material respects at such specified time.

         (d)     NCBE shall have received the opinion of legal counsel for
                 United, dated the time the Merger shall become effective,
                 substantially to the effect set forth in Exhibit B hereto.





                                       39
<PAGE>   40


         (e)     United shall have performed or satisfied in all material
                 respects all agreements, covenants and  conditions required by
                 this Merger Agreement to be performed or satisfied by it at or
                 prior to the time the Merger shall become effective.

         (f)     At the time the Merger shall become effective, no suit, action
                 or proceeding shall be pending or overtly threatened before
                 any court or other governmental agency by the federal or state
                 government in which it is sought to restrain or prohibit the
                 consummation of the Merger, and no other suit, action or
                 proceeding shall be pending or overtly threatened and no
                 liability or claim shall have been asserted against United or
                 United Bank which NCBE shall in good faith determine, with
                 advice of counsel: (i) has a reasonable likelihood of being
                 successfully prosecuted and (ii) if successfully prosecuted,
                 would result in a Material Adverse Effect on United.

         (g)     Holders of United Common Stock who are entitled to exercise in
                 the aggregate not more than 5% of the voting power of the
                 issued and outstanding United Common Stock as of the time the
                 Merger shall become effective shall have taken steps to
                 perfect their rights as dissenting shareholders pursuant to
                 the provisions of Section 262 of the Delaware General Business
                 Corporation Law so that if, at the time the Merger shall
                 become effective, holders of more than 5% of such shares shall
                 have taken such steps, NCBE may, at its option, refuse to
                 consummate the Merger.

         (h)     United shall have furnished NCBE certificates, signed on its
                 behalf by the Chairman or President and the Secretary or an
                 Assistant Secretary of United and dated the time the Merger
                 shall become effective, to the effect that to the best of
                 their knowledge, after due inquiry, the conditions described
                 in Paragraphs (b), (c), and (f) of this Section 20 have been
                 fully satisfied.





                                       40
<PAGE>   41

         (i)     No event shall have occurred which, in the reasonable opinion
                 of NCBE and concurred in by McGladrey & Pullen, would prevent
                 the Merger from being accounted for as a pooling of interests.

         (j)     The employment contracts between United Bank and Janice L.
                 Beesley, G. Jeffrey Palmer and Patrick W. Lenahan shall have
                 expired or have been terminated, without liability to United
                 or United Bank, at or prior to the effective time of the
                 Merger.

21.      Conditions to Obligations of United.  The obligations of United under
         this Merger Agreement are subject, unless waived by United, to the
         satisfaction on or prior to the time the Merger shall become effective
         of the following conditions:

         (a)     There shall not have occurred an event or series of events
                 which has or is likely to result in a Material Adverse Effect
                 on NCBE from September 30, 1994, to the time the Merger shall
                 become effective.

         (b)     All representations by NCBE contained in this Merger Agreement
                 shall be true in all material respects at, or as of, the time
                 the Merger shall become effective as though such
                 representations were made at and as of said date, except for
                 changes contemplated by this Merger Agreement, and except also
                 for representations as of a specified time other than the time
                 the Merger shall become effective, which shall be true in all
                 material respects at such specified time.

         (c)     United shall have received the opinions of Counsel for NCBE
                 dated the time the Merger shall become effective substantially
                 to the effect set forth in Exhibit C hereto and in section 12
                 hereto.

         (d)     NCBE shall have performed or satisfied in all material
                 respects all agreements and covenants required by this Merger
                 Agreement to be performed or satisfied by it at or prior to
                 the time the Merger shall become effective.

         (e)     At the time the Merger shall become effective, no suit, action
                 or proceeding shall be pending or overtly threatened before
                 any court or other governmental agency





                                       41
<PAGE>   42

                 of the federal or state government in which it is sought to
                 restrain, prohibit or set aside consummation of the Merger and
                 no other suit, action or proceeding shall be pending or
                 overtly threatened and no liability or claim shall have been
                 asserted against NCBE which United shall in good faith
                 determine, with advice of counsel:  (i) has a reasonable
                 likelihood of being successfully prosecuted; and (ii) if
                 successfully prosecuted, would result in a Material Adverse
                 Effect on NCBE.

         (f)     NCBE shall have furnished United a certificate, signed by the
                 Chairman or President and by the Secretary or Assistant
                 Secretary of NCBE and dated the time the Merger shall become
                 effective to the effect that to the best of their knowledge
                 after due inquiry the conditions described in Paragraphs (a),
                 (b), and (e) of this Section 21 have been fully satisfied.

         (g)     United shall have received a written opinion of Charles Webb
                 and Co., dated within two days of the date of the
                 Prosptecuts/Proxy Statement, reasonably satisfactory in
                 substance to the United Board of Directors, to the effect that
                 the Merger is fair to the holders of United common stock from
                 a financial point of view, and such opinion shall not have
                 been withdrawn prior to the conclusion of the United
                 shareholders' meeting.

         (h)     No event shall have occurred which would prevent the Merger
                 from being accounted for as a pooling of interests.

22.      Conditions to Obligations of All Parties.  In addition to the
         provisions of Sections 20 and 21 hereof, the obligations of NCBE and
         United to cause the transactions contemplated herein to be consummated
         shall be subject to the satisfaction of the following conditions on or
         prior to the time the Merger shall become effective:

         (a)     The parties hereto shall have received all necessary approvals
                 of governmental agencies and authorities of the transactions
                 contemplated by this Merger Agreement and each of such
                 approvals shall remain in full force and effect at the time
                 the Merger shall become effective and such approvals and the
                 transactions





                                       42
<PAGE>   43

                 contemplated thereby shall not have been contested by any
                 federal or state governmental authority by formal proceeding,
                 or contested by any other third party by formal proceeding
                 which the Board of Directors of the party asserting a failure
                 of a condition under this Section 22(a) shall in good faith
                 determine, with the advice of counsel:  (i) has a reasonable
                 likelihood of being successfully prosecuted and (ii) if
                 successfully prosecuted, would materially and adversely affect
                 the benefits hereunder intended for such party.  It is
                 understood that, if any such contest is brought by formal
                 proceedings, NCBE may, but shall not be obligated to, answer
                 and defend such contest.  NCBE shall notify United promptly
                 upon receipt of all necessary governmental approvals.

         (b)     The Registration Statement shall have become effective by an
                 order of the SEC, the shares of NCBE Common Stock to be
                 exchanged in the Merger shall have been qualified or exempted
                 under all applicable state securities laws, and there shall
                 have been no stop order issued or threatened by the SEC that
                 suspends or would suspend the effectiveness of the
                 registration statement, and no proceeding shall have been
                 commenced, pending or overtly threatened for such purpose.

         (c)     This Merger Agreement shall have been duly adopted, ratified
                 and confirmed by the requisite affirmative votes of the
                 shareholders of United and, if required, NCBE.

         (d)     NCBE and United shall have received the opinion called for
                 pursuant to Section 12 of this Merger Agreement and there
                 shall exist as of, at or immediately prior to the time the
                 Merger shall become effective no facts or circumstances which
                 would render such opinion inapplicable in any respect to the
                 transactions to be consummated hereunder.

23.      Nonsurvival of Representations and Warranties. The respective
         representations and warranties of NCBE and United set forth shall not
         survive the time the Merger shall





                                       43
<PAGE>   44

         become effective, provided, however, that all agreements or covenants
         of a party contemplated to be performed after the time the Merger
         becomes effective shall survive.

24.      Governing Law.  This Merger Agreement shall be construed and
         interpreted according to the applicable laws of the State of Indiana,
         except to the extent that federal or Delaware law controls.

25.      Assignment.  This Merger Agreement and all of the provisions hereof
         shall be binding upon and inure to the benefit of the parties hereto
         and their respective successors and permitted assigns, but neither
         this Merger Agreement nor any of the rights, interest, or obligations
         hereunder shall be assigned by either of the parties hereto without
         the prior written consent of the other party; provided, however, that
         NCBE shall not engage in a transaction pursuant to which its
         shareholders exchange NCBE common stock for securities or property of
         another party whether by statutory share exchange, merger,
         consolidation, reorganization or the sale of substantially all the
         assets of NCBE without concurrently therewith assigning to the
         acquiring or surviving party, all of the obligations of NCBE under
         this Agreement.

26.      Satisfaction of Conditions.

         NCBE agrees to use its best effort to obtain satisfaction of the
         conditions insofar as they relate to NCBE,  and United agrees to use
         its best efforts to obtain the satisfaction of the conditions insofar
         as they relate to United.

27.      Termination.  This Merger Agreement may be terminated prior to the
         time the Merger becomes effective as follows:

         (a)     by mutual consent of NCBE and United, if the Board of
                 Directors of each so determines by vote of a majority of the
                 members of its entire Board;

         (b)     by either NCBE or United, if any of the conditions to such
                 party's obligation to consummate the transactions contemplated
                 in this Merger Agreement shall have become impossible to
                 satisfy;





                                       44
<PAGE>   45


         (c)     by either NCBE or United, if this Merger Agreement is not duly
                 approved by the requisite vote of shareholders of United and
                 NCBE, if required, in each case a meeting of shareholders (or
                 any adjournment thereof duly called and held for such
                 purpose);

         (d)     by either NCBE or United, if the Merger does not become
                 effective on or before September 30, 1995 (unless the failure
                 to consummate the Merger by such date shall be due to the
                 action or failure to act of the party seeking to terminate
                 this Merger Agreement);

         (e)     by NCBE or United as provided in Section 17(b) hereof;

         (f)     by United if the Average Price is less than $38.00 as
                 recalculated for each Stock Adjustment;

         (g)     by United if its Board of Directors shall determine, after
                 consultation with United's independent financial advisor and
                 outside counsel, that the failure to terminate this Merger
                 Agreement could reasonably be found to constitute a breach of
                 its fiduciary duties; or

         (h)     by either NCBE or United, if the other party hereto commits a
                 willful breach which is not cured within 10 days after receipt
                 by the breaching party of written demand for cure by the
                 nonbreaching party.  For purposes of this Merger Agreement, a
                 "willful breach" means a knowing and intentional violation by
                 a party of any of its covenants, representations, warranties,
                 agreements or obligations under this Merger Agreement.

         Any party desiring to terminate this Merger Agreement shall give
         written notice of such termination and the reasons therefor to the
         other party.

28.      Effect of Termination.

         (a)     In the event this Merger Agreement is properly terminated
                 pursuant to Section 27(a)-(f), then neither party shall have
                 any liability to the other party.





                                       45
<PAGE>   46

         (b)     In the event this Merger Agreement is properly terminated
                 pursuant to Section 27(g), then within ten (10) days after
                 written demand by NCBE, United shall pay to NCBE in
                 immediately available funds, a termination fee of $500,000.

         (c)     In the event this Merger Agreement is properly terminated by
                 either party pursuant to Section 27(h), then within ten (10)
                 days after written demand by the terminating party, the party
                 that has willfully breached this Merger Agreement shall pay to
                 the terminating party, in immediately available funds,
                 $1,000,000 as agreed upon liquidated damages.

         (d)     The confidentiality provisions of Section 10(d) hereof shall
                 survive any termination of this Merger Agreement.

29.      Waivers Amendments.  Any of the provisions of this Merger Agreement
         may be waived at any time by the party which is, or the shareholders
         of which are, entitled to the benefit thereof, by resolution of the
         Board of Directors of such party.  This Merger Agreement may be
         amended or modified in whole or in part by an agreement in writing
         executed in the same manner (but not necessarily by the same person)
         as this Merger Agreement and which makes reference to this Merger
         Agreement, pursuant to a resolution, adopted by the Boards of
         Directors of the respective parties, provided, however, such amendment
         or modification may be made in this manner by the respective Boards of
         Directors of NCBE and United at anytime prior to a favorable vote of
         such party's shareholders, but may be made after a favorable vote by
         the shareholders of such party, only if, in the opinion of its Board
         of Directors, such amendment or modification will not have any
         material adverse effect on the benefits intended under this Merger
         Agreement for the shareholders of such party and will not require
         resolicitation of any proxies from such shareholders.

30.      Entire Agreement.  This Agreement supersedes any other agreement,
         whether written or oral, that may have been made or entered into by
         NCBE and United or by any officer or officers of such parties relating
         to the acquisition of the business or the capital stock of United by
         NCBE.  Except for the letters specified in this Merger Agreement and
         of even





                                       46
<PAGE>   47

         date herewith, this Agreement constitutes the entire agreement by the
         parties, and there are no agreements or commitments except as set
         forth herein and therein.

31.      Captions; Counterparts.  The captions in this Merger Agreement are for
         convenience only and shall not be considered a part of or affect the
         construction or interpretation of any provision of this Merger
         Agreement.  This Merger Agreement may be executed in several
         counterparts, each of which shall constitute one and the same
         instrument.

32.      Notices.  All notices and other communications hereunder shall be
         deemed to have been duly given if forwarded by a nationally recognized
         overnight courier service.  All notices and other communications
         hereunder given to any party shall be communicated to the remaining
         party to this Merger Agreement by mail in the same manner as herein
         provided.

                 a)  If to NCBE, to:

                 Mr. Robert A. Keil
                 President
                 National City Bancshares, Inc.
                 227 Main Street, P.O. Box 868
                 Evansville, Indiana  47705-0868

                 With copies to:

                 Martin D. Werner, Esq.
                 Werner & Blank Co., L.P.A.
                 7205 W. Central Avenue
                 Toledo, Ohio  43617

                 (b)  If to United, to:

                 Ms. Janice L. Beesley
                 President
                 United Financial Bancorp, Inc.
                 619 Main Street
                 Vincennes, IN   47591

                 With copies to:

                 Jeffrey M. Werthan, Esq.





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<PAGE>   48

                 Silver Freedman & Taff
                 1100 New York Avenue, N.W.
                 Washington, D.C.  20005

33.      Publicity.  NCBE and United agree to consult with and obtain the
         consent of the other, prior to any media release or other public
         disclosures as to the matters covered by this Merger Agreement, except
         as may be required by law.  
         IN WITNESS WHEREOF, this Merger Agreement has been executed the day and
year first above written.


ATTEST:                                 National City Bancshares, Inc.

__________________________________      By: /s/ JOHN D. LIPPERT         
By: /s/ ROBERT A. KEIL                      John D. Lippert, Chairman,
Its: President                              and Chief Executive Officer

ATTEST:                                 United Financial Bancorp, Inc..

__________________________________      By: /s/ JANICE L. BEESLEY       
By: /s/ HORACE A. FONCANNON                 Janice L. Beesley, President and
Its: Chairman of the Board                  Chief Executive Officer





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