UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


                                    Form 10-Q


       Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
                              Exchange Act of 1934

     For the quarter ended September 30, 1995   Commission File Number 0-13030



                              TRANS FINANCIAL, INC.
             (Exact name of registrant as specified in its charter)



                   Kentucky                               61-1048868
        (State or other jurisdiction of        (IRS Employer Identification No.)
         incorporation or organization)

        500 East Main Street, Bowling Green, Kentucky        42101
         (Address of principal executive offices)        (Zip Code)


       Registrant's telephone number, including area code: (502)781-5000


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required to file such reports), and (2) has been subject
 to such filing requirements for the past 90 days.  Yes X  No _


     The number of shares outstanding of the issuer's class of common stock
                     on November 9, 1995: 11,285,291 shares.


        The  Exhibit  Index is on page 21. This filing  contains 127
                         pages (including this facing sheet).


<PAGE>







                         Part I - Financial Information





Item 1. Financial Statements


<PAGE>


<TABLE>
<CAPTION>

 Consolidated Balance Sheets

 (Unaudited)
 In thousands, except share data                September 30      December 31   September 30
                                                      1995           1994           1994
 Assets
<S>                                             <C>            <C>            <C>
Cash and due from banks .....................   $    68,751    $    80,828    $    83,037
Interest-bearing deposits with banks ........           197            197            197
Federal funds sold and
   resale agreements ........................           575           --            2,500
Mortgage loans held for sale ................        30,631          6,541          4,886
Securities available for sale (amortized
   cost of $212,236 as of September 30, 1995;
   $242,079 as of December 31, 1994;
   and $254,389 as of September 30, 1994) ...       209,357        229,643        245,129
Securities held to maturity (market
   value of $80,116 as of September 30, 1995;
   $81,209 as of December 31, 1994;
   and $85,741 as of September 30, 1994) ....        78,478         84,758         87,380
Loans, net of unearned income ...............     1,237,038      1,143,716      1,101,982
Less allowance for loan losses ..............        13,659         12,529         12,539
                                                -----------    -----------    -----------
   Net loans ................................     1,223,379      1,131,187      1,089,443
Premises and equipment, net .................        38,600         36,440         36,012
Other assets ................................        65,182         48,241         47,287
                                                ===========    ===========    ===========
   Total assets .............................   $ 1,715,150    $ 1,617,835    $ 1,595,871
                                                ===========    ===========    ===========
Liabilities and Shareholders' Equity
Deposits:
   Non-interest bearing .....................   $   171,788    $   192,433    $   180,314
   Interest bearing .........................     1,240,421      1,143,076      1,165,157
                                                -----------    -----------    -----------
   Total deposits ...........................     1,412,209      1,335,509      1,345,471
Federal funds purchased and
   repurchase agreements ....................        76,429         74,553         47,349
Other short-term borrowings .................        38,019         48,033         43,243
Long-term debt ..............................        36,891         37,334         37,541
Other liabilities ...........................        24,873         10,774         11,355
                                                -----------    -----------    -----------
   Total liabilities ........................     1,588,421      1,506,203      1,484,959
Shareholders' equity:
   Common stock, no par value. Authorized
      50,000,000 shares; issued and
      outstanding 11,284,604; 11,203,247;
      and 11,190,342 shares, respectively ...        21,154         21,006         20,982
   Additional paid-in capital ...............        43,754         42,810         42,641
   Retained earnings ........................        66,988         59,587         57,106
   Unrealized net loss on
      securities available for sale,
      net of tax ............................        (1,887)        (8,073)        (5,982)
   Employee Stock Ownership Plan shares
      purchased with debt ...................        (3,280)        (3,698)        (3,835)
                                                -----------    -----------    -----------
   Total shareholders' equity ...............       126,729        111,632        110,912
   Total liabilities
     and shareholders' equity ...............   $ 1,715,150    $ 1,617,835    $ 1,595,871
                                                ===========    ===========    ===========
</TABLE>

 See accompanying notes to consolidated financial statements.
<PAGE>

 Consolidated Statements of Income

<TABLE>
<CAPTION>

 (Unaudited)

 In thousands, except per share data         Three Months            Nine Months

 For the periods ended September 30          1995        1994       1995        1994

 Interest income

<S>                                      <C>         <C>        <C>         <C>
  Loans, including fees ..............   $ 29,197    $ 23,684   $ 84,026    $ 67,440
  Federal funds sold and resale
    agreements .......................        177         215        730         525
  Securities available for sale ......      3,083       3,203      9,581       8,768
  Securities held to maturity ........      1,234       1,613      3,812       5,825
  Mortgage loans held for sale .......        527         136        969       1,031
  Interest-bearing deposits with banks          4          75         13          99
                                         --------    --------   --------    --------
  Total interest income ..............     34,222      28,926     99,131      83,688
Interest expense
  Deposits ...........................     14,839      10,630     41,809      30,815
   Federal funds purchased
    and repurchase agreements ........        522         297      1,379         749
  Long-term debt and other
    borrowings .......................      1,325       1,045      4,167       3,108
                                         --------    --------   --------    --------
  Total interest expense .............     16,686      11,972     47,355      34,672
                                         --------    --------   --------    --------
Net interest income ..................     17,536      16,954     51,776      49,016
  Provision for loan losses ..........        780         555      2,080       1,567
                                         --------    --------   --------    --------
Net interest income after
  provision for loan losses ..........     16,756      16,399     49,696      47,449
Non-interest income
  Service charges on deposit accounts       2,127       1,914      6,272       5,492
  Mortgage banking income ............      1,658         778      3,691       1,900
  Gains losses) on sales of securities
    available for sale, net ..........        (21)         33        (21)        121
  Gain on sale of mortgage servicing .       --          --        1,687        --
  Trust services .....................        329         310        979         932
  Brokerage income ...................        438         184      1,316         720
  Other ..............................      1,233       1,055      3,425       3,064
                                         --------    --------   --------    --------
  Total non-interest income ..........      5,764       4,274     17,349      12,229
Non-interest expenses
  Compensation and benefits ..........      7,891       6,474     22,584      19,365
  Net occupancy expense ..............      1,266       1,186      3,554       3,264
  Furniture and equipment expense ....      1,529       1,390      4,535       3,805
  Deposit insurance ..................        215         785      1,754       2,399
  Professional fees ..................        685         691      2,404       2,484
  Postage, printing & supplies .......        826         941      2,659       2,706
  Communications .....................        365         270      1,155         796
  Other ..............................      3,024       3,259      9,904       9,378
                                         --------    --------   --------    --------
  Total non-interest expenses ........     15,801      14,996     48,549      44,197
                                         --------    --------   --------    --------
Income before income taxes ...........      6,719       5,677     18,496      15,481
Income tax expense ...................      2,175       1,870      6,038       5,112
                                          -------     -------   --------    --------

Net income ...........................   $  4,544    $  3,807   $ 12,458    $ 10,369
                                         ========    ========   ========    ========
Net income available
  for common stock ...................      4,544    $  3,793   $ 12,458    $ 10,315
                                         ========    ========   ========    ========
Primary earnings per share ...........   $   0.40    $   0.34   $   1.10    $   0.92
Fully-diluted earnings per share .....   $   0.40    $   0.34   $   1.09    $   0.92
                                         ========    ========   ========    ========
</TABLE>

 See accompanying notes to consolidated financial statements.




<PAGE>



 Consolidated Statements of Changes in Shareholders' Equity
 (Unaudited)
 In thousands
 For the nine months ended September 30      1995         1994

Balance January 1 ...................   $ 111,632    $ 112,036
  Net income ........................      12,458       10,369
  Issuance of common stock ..........       1,093          462
  Retirement of  preferred stock ....        --         (1,010)
  Cash dividends declared:
    Common stock ....................      (5,059)      (4,216)
    Preferred stock .................        --            (54)
  Change in unrealized gain (loss) on
    securities available for sale,
    net of taxes ....................       6,186       (6,700)
  ESOP debt reduction ...............         419          277
  ESOP shares purchased with debt ...        --           (252)
                                        =========    =========
Balance September 30 ................   $ 126,729    $ 110,912
                                        =========    =========

 See accompanying notes to consolidated financial statements.




<PAGE>



 Consolidated Statements of Cash Flows

 (Unaudited)
<TABLE>
<CAPTION>

 In thousands

 For the nine months ended September 30                             1995         1994

 Cash flows from operating activities:

<S>                                                            <C>          <C>
Net income .................................................   $  12,458    $  10,369
Adjustments to reconcile net income to cash provided be operating activities:
    Provision for loan losses ..............................       2,080        1,567
    Losses/(gains) on sales of securities available for sale          21         (121)
    Losses (gains) on sales of mortgage loans
      held for sale, net ...................................        (935)         160
    Gain on sale of mortgage servicing rights ..............      (1,687)        --
    Gain on sale of premises and equipment .................        (174)        (193)
    Depreciation, amortization and accretion, net ..........       6,074        4,561
Proceeds from sale of mortgage loans held for sale .........      76,694      161,175
Originations of mortgage loans held for sale ...............     (99,849)    (121,043)
(Increase)  in other assets ................................     (13,003)      (9,925)
Increase  in other liabilities .............................      10,394        4,821
                                                               ---------    ---------
  Net cash provided by (used in) operating activities ......      (7,927)      51,371

Cash flows from investing activities:
Net decrease in interest-bearing deposits
  with banks ...............................................        --            250
Net decrease (increase) in federal funds sold
  and resale agreements ....................................        (575)      30,278
Proceeds from sales of securities available for sale .......      20,092        6,989
Proceeds from maturities, prepayment and call of securities:
  Available for sale .......................................      34,116       54,533
  Held to maturity .........................................       6,383       25,391
Purchases of securities:
  Available for sale .......................................     (22,493)     (19,301)
  Held to maturity .........................................      (3,000)     (26,350)
Net increase in loans ......................................     (94,109)     (97,912)
Purchases of premises and equipment ........................      (6,153)      (5,294)
Proceeds from disposals of premises and equipment ..........         644          885
Net cash and cash equivalents inflow from acquisition ......      37,479         --
                                                               ---------    ---------
  Net cash used in investing activities ....................     (27,616)     (30,531)

Cash flows from financing activities:
Net increase (decrease) in deposits ........................      35,595      (30,756)
Net increase in federal funds purchased
  and repurchase agreements ................................       1,876       17,645
Net increase (decrease) in other short-term borrowings .....     (10,014)      18,243
Repayment of long-term debt ................................         (25)      (6,650)
Retirement of preferred stock ..............................        --         (1,010)
Proceeds from issuance of common stock .....................       1,093          462
Dividends paid .............................................      (5,059)      (4,270)
                                                               ---------    ---------
  Net cash provided by (used in) financing activities ......      23,466       (6,336)
                                                               ---------    ---------
Net increase/(decrease) in cash and cash equivalents .......     (12,077)      14,504
Cash and cash equivalents at beginning of year .............      80,828       68,533
                                                               =========    =========
Cash and cash equivalents at end of period (note 3) ........   $  68,751    $  83,037
                                                               =========    =========
</TABLE>


 See accompanying notes to consolidated financial statements.

<PAGE>

Notes to Consolidated Financial Statements

 (1) Summary of Significant Accounting Policies
     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore, do not
include all information and footnotes required by generally accepted  accounting
principles for complete financial statements. In the opinion of management,  all
adjustments  (consisting only of normal recurring accruals) considered necessary
for a fair  presentation  have  been  reflected  in the  accompanying  unaudited
financial statements.  Results of interim periods are not necessarily indicative
of results to be expected for the full year.
     The  accounting  and reporting  policies of Trans  Financial,  Inc. and its
subsidiaries ("the company") conform to generally accepted accounting principles
and general  practices within the banking industry.  The consolidated  financial
statements  include the accounts of Trans  Financial,  Inc. and its wholly-owned
subsidiaries.  All significant inter-company accounts and transactions have been
eliminated in  consolidation.  A  description  of other  significant  accounting
policies is presented in the 1994 annual report to shareholders.

(2) Allowance for Loan Losses
     An analysis of the changes in the allowance for loan losses follows:
<TABLE>
<CAPTION>

 In thousands                                                       Three Months                       Nine Months
 For the periods ended September 30                                1995             1994              1995             1994

<S>                                                             <C>              <C>               <C>              <C>
 Balance beginning of period                                    $13,429          $12,836           $12,529          $12,505
   Provision for loan losses                                        780              555             2,080            1,567

   Loans charged off                                              (681)            (996)           (1,313)          (1,957)
   Recoveries of loans previously charged off                       131              144               363              424
                                                           -------------    -------------     -------------    -------------
   Net charge-offs                                                (550)            (852)             (950)          (1,533)
                                                           -------------    -------------     -------------    -------------

 Balance September 30                                           $13,659          $12,539           $13,659          $12,539
                                                    =============    =============     =============    =============
</TABLE>
      
(3) Statement of Cash Flows
     For purposes of reporting  cash flows,  cash and cash  equivalents  include
cash on hand  and  amounts  due  from  banks.  Certain  non-cash  investing  and
financing transactions are summarized as follows:
<TABLE>
<CAPTION>

<S>                                                                                  <C>              <C> 
     Nine months ended September 30 (Dollars in thousands)                               1995             1994
     Securities transferred from held to maturity to available for sale              $      -          $52,920
     Increase (decrease) in unrealized loss
         on securities available for sale, net of tax                                  (6,186)           6,700
     Loans transferred to foreclosed property                                             197            1,158
     Reclassification of borrowings from long-term to short-term                            -           10,000
     Debt transactions of Employee Stock Ownership Plan (net)                             419              (25)
</TABLE>

(4) Impaired Loans
     The  company  adopted on a  prospective  basis  effective  January 1, 1995,
Statement of Financial Accounting Standards No. 114, Accounting by Creditors for
Impairment  of a Loan ("SFAS 114").  SFAS 114 requires  that  impaired  loans be
measured at the present value of expected  future cash flows,  discounted at the
loan's effective interest rate, at the loan's observable market price, or at the
fair value of the  collateral if the loan is collateral  dependent.  The company
accrues  interest  income daily on impaired loans  classified as accruing.  Cash
receipts on impaired  loans are applied to the recorded  investment in the loan,
including accrued interest  receivable.  The adoption of SFAS 114 did not have a
material effect on the company's consolidated financial statements.
     The  company's  recorded  investment  in impaired  loans was  $8,224,000 at
September 30, 1995.  Of that amount,  $7,444,000  represents  loans for which an
allowance for loan losses,  in the amount of  $2,646,000,  has been  established
under SFAS 114. The average recorded investment of impaired loans was $8,518,000
for the three  months ended  September  30, 1995,  and  $6,713,000  for the nine
months then ended. Interest income recognized on impaired loans totaled $-0- for
the three months ended September 30, 1995, and $59,000 for the nine-month period
ended September 30, 1995.

(5) Mortgage Servicing Rights
     The  company  adopted on a  prospective  basis  effective  January 1, 1995,
Statement of Financial  Accounting  Standards No. 122,  Accounting  for Mortgage
Servicing Rights ("SFAS 122"). SFAS 122 requires that rights to service mortgage
loans for others be recognized as assets, without regard to whether those assets
were  acquired  in  purchase   transactions   or  were  acquired   through  loan
originations.  SFAS 122 also eliminates the previous  requirement  that gains on
mortgage  loan sales be offset  against the  related  mortgage  servicing  right
asset.  The  adoption of this  statement  resulted  in an  $818,000  increase in
mortgage banking income in the first nine months of 1995.


Item 2. Management's Discussion and Analysis of Financial Condition and 
Results of Operations
General
     Incorporated in 1981, Trans  Financial,  Inc. ("the company") is a bank and
savings and loan holding company  registered  under the Bank Holding Company Act
of  1956  and  the  Home  Owners'  Loan  Act,  which  has  two  commercial  bank
subsidiaries  and  one  thrift  subsidiary:   Trans  Financial  Bank,   National
Association,   headquartered  in  Bowling  Green,  Kentucky  ("TFB-KY");   Trans
Financial Bank Tennessee,  National  Association,  headquartered  in Cookeville,
Tennessee;  and  Trans  Financial  Bank,  F.  S.B.,  with  its  home  office  in
Russellville, Kentucky.
     In addition,  the company operates as subsidiaries of TFB-KY a full-service
securities broker/dealer,  Trans Financial Investment Services, Inc.; a mortgage
banking company,  Trans Financial  Mortgage Company;  and a full-service  travel
agency, Trans Travel, Inc.
     The company had total  consolidated  assets of $1.715  billion on September
30,  1995.  Loans  totaled  $1.237  billion on that date,  deposits  were $1.412
billion and shareholders' equity was $127 million.
     The discussion that follows is intended to provide  additional insight into
the company's  financial  condition and results of operations.  This  discussion
should be read in conjunction  with the  consolidated  financial  statements and
accompanying notes presented in Item 1 of Part I of this report.


Results of Operations
Overview
     For the nine months ended  September  30, 1995,  the  company's  net income
increased 20%, from $10.3 million,  or $.92 per common share,  to $12.5 million,
or $1.10 per share,  as compared  to the first nine months of 1994.  Results for
the first nine months of 1995 produced an annualized return on average assets of
1.01% and a return on average common equity of 13.95%,  compared with returns of
0.87% and 12.40%, respectively, for the comparable period of 1994.
     For the third quarter of 1995, net income  increased from $3.8 million,  or
$.34 per common share,  to $4.5 million,  or $.40 per share,  as compared to the
third  quarter of 1994.  Return on average  assets for the third quarter of 1995
was 1.07% and a return on  average  common  equity  was  14.58%,  compared  with
returns of 0.96% and 13.53%, respectively, for the third quarter of 1994.
     The company  recognized  during the third  quarter  1995  refunds  from the
Federal Deposit Insurance Corp.  (FDIC) associated with the  over-capitalization
of the  Bank  Insurance  Fund.  The  refunds,  covering  the  four-month  period
beginning June 1, when the lowered premiums retroactively took effect,  amounted
to  approximately  $585  thousand on a pre-tax  basis.  Excluding  the after-tax
impact of these  refunds  on third  quarter  earnings,  the  company  would have
reported  earnings  of $0.37 per common  share,  an increase of 9% over the same
period in 1994.

Net Interest Income
     Net interest income totaled $51.8 million in the first nine months of 1995,
compared with $49.0 million in the comparable  1994 period - a 6% increase.  For
the first nine months of 1995,  net interest  margin (net  interest  income as a
percentage of average  interest-earning  assets) increased 10 basis points, from
4.48% to 4.58%. This reflects the positive impact of prime rate increases during
1994  and  early  in 1995 as well as a more  favorable  mix of  earning  assets,
primarily  due to  continued  loan  growth  and the  redeployment  of funds from
matured  investment  securities.  Approximately  $575  million of the  company's
commercial  and  consumer  loans  are  tied  to the  prime  rate.  Consequently,
increases  in the prime  lending  rate had a  positive  impact  on net  interest
margin.  At the same time, while rates on earning assets rose,  increases in the
company's funding costs had not kept pace with the increase in loan yields.
     In the third  quarter  of 1995,  net  interest  income  increased  to $17.5
million - a 3% increase from the $17.0 million reported for the third quarter of
1994. Net interest  margin for the third quarter  declined 8 basis points,  from
4.64% to 4.52%, from the comparable quarter of the prior year. As the prime rate
leveled off in the second  quarter of 1995,  increases in the company's  funding
costs, which had lagged behind the increases in loan yields,  continued to rise.
As a result, the company's net interest spread (the difference between the gross
yield  on  interest-earning   assets  and  the  rate  paid  on  interest-bearing
liabilities)  decreased,  negatively  impacting  the net  interest  margin.  The
negative  impact of this  phenomenon was offset by increased net interest income
due to loan growth.
     The  following  tables show,  for the nine- and  three-month  periods ended
September  30, 1995 and 1994,  the  relationships  between  interest  income and
expense  and  the  levels  of  interest-earning   assets  and   interest-bearing
liabilities.


<PAGE>



 Average Consolidated Balance Sheets and Net Interest Analysis

 For the Nine Months Ended September 30

 Dollars in thousands
<TABLE>
<CAPTION>

                                                       1995                                          1994

                                        Average                     Average           Average                     Average
                                        Balance       Interest        Rate            Balance        Interest       Rate
 Assets:

 Interest-earning assets:
<S>                                     <C>             <C>             <C>           <C>              <C>            <C>  
   Loans, net of unearned income        $1,172,796      $84,026         9.58%         $1,058,221       $67,440        8.52%
   Securities available for sale           222,008        9,581         5.77%            224,935         8,768        5.21%
   Securities held to maturity              84,201        3,812         6.05%            138,851         5,825        5.61%
   Mortgage loans held for sale             14,564          969         8.90%             21,525         1,031        6.40%
   Federal funds sold
     and other interest income              16,803          743         5.91%             17,876           624        4.67%
                                     --------------  -----------                   --------------  ------------
 Total interest-earning assets /
   interest income                       1,510,372       99,131         8.78%          1,461,408        83,688        7.66%
                                                     -----------                                   ------------
 Non-interest-earning assets:
   Cash and due from banks                  63,874                                        65,261
   Premises and equipment                   37,659                                        34,804
   Other assets                             38,614                                        25,918
                                     ==============                                ==============
 Total assets                           $1,650,519                                    $1,587,391
                                     ==============                                ==============
 Liabilities and Shareholders' Equity

 Interest-bearing liabilities:

   Interest-bearing deposits:

     Interest-bearing demand (NOW)        $137,668       $2,678         2.60%           $143,898        $2,582        2.40%
     TransPlus (SuperNOW)                   93,715        1,948         2.78%            101,121         1,817        2.40%
     Savings deposits                      133,800        2,917         2.91%            158,291         3,305        2.79%
     Money market accounts                  47,292        1,124         3.18%             55,982         1,099        2.62%
     Certificates of deposit               725,912       29,620         5.46%            636,841        19,044        4.00%
     Other time deposits                    88,653        3,522         5.31%             93,714         2,968        4.23%
                                     --------------  -----------                   --------------  ------------
     Total interest-bearing deposits     1,227,040       41,809         4.56%          1,189,847        30,815        3.46%
 Federal funds purchased
   and repurchase agreements                44,465        1,379         4.15%             36,023           749        2.78%
 Long-term debt and
   and other borrowings                     79,664        4,167         6.99%             74,789         3,108        5.56%
                                     --------------  -----------                   --------------  ------------
   Total borrowed funds                    124,129        5,546         5.97%            110,812         3,857        4.65%
                                     --------------  -----------                   --------------  ------------
 Total interest-bearing liabilities /
   interest expense                      1,351,169       47,355         4.69%          1,300,659        34,672        3.56%
                                                     -----------                                   ------------
 Non-interest-bearing liabilities:
   Non-interest-bearing deposits           165,522                                       166,718
   Other liabilities                        14,435                                         7,870
                                     --------------                                --------------
   Total liabilities                     1,531,126                                     1,475,247
 Shareholders' equity                      119,393                                       112,144
                                     --------------                                --------------
 Total liabilities
   and shareholders' equity             $1,650,519                                    $1,587,391
                                     ==============                                ==============
 Net interest-rate spread                                               4.09%                                         4.10%
 Impact of non-interest bearing
   sources and other changes in
   balance sheet composition                                            0.49%                                         0.38%
                                                                  ------------                                   -----------
 Net interest income /
   margin on interest-earning                           $51,776         4.58%                          $49,016        4.48%
assets
                                                     ===========  ============                     ============  ===========
</TABLE>

Net interest margin is net interest  income divided by average  interest-earning
assets.   For  computational   purposes,   non-accrual  loans  are  included  in
interest-earning  assets.  Net  interest  spread is the  difference  between the
average rate of interest earned on interest-earning  assets and the average rate
of interest expensed on interest-bearing liabilities.
Average balances are based on daily balances.



<PAGE>



 Average Consolidated Balance Sheets and Net Interest Analysis

 For the Three Months Ended September 30

 Dollars in thousands
<TABLE>
<CAPTION>

                                                       1995                                          1994

                                        Average                     Average           Average                     Average
                                        Balance       Interest        Rate            Balance        Interest       Rate
 Assets:

 Interest-earning assets:

<S>                                     <C>             <C>             <C>           <C>              <C>            <C>  
   Loans, net of unearned income        $1,204,297      $29,197         9.62%         $1,079,153       $23,684        8.71%
   Securities available for sale           217,123        3,083         5.63%            217,917         3,203        5.83%
   Securities held to maturity              81,236        1,234         6.03%            123,568         1,613        5.18%
   Mortgage loans held for sale             23,616          527         8.85%              8,454           136        6.38%
   Federal funds sold
     and other interest income              12,302          181         5.84%             20,402           290        5.64%
                                     --------------  -----------                   --------------  ------------
 Total interest-earning assets /
   interest income                       1,538,574       34,222         8.82%          1,449,494        28,926        7.92%
                                                     -----------                                   ------------
 Non-interest-earning assets:
   Cash and due from banks                  60,091                                        67,994
   Premises and equipment                   38,253                                        36,158
   Other assets                             42,378                                        26,333
                                     ==============                                ==============
 Total assets
                                        $1,679,296                                    $1,579,979
                                     ==============                                ==============
 Liabilities and Shareholders' Equity
 Interest-bearing liabilities:
   Interest-bearing deposits:
     Interest-bearing demand (NOW)        $138,988         $930         2.65%           $143,373          $891        2.47%
     TransPlus (SuperNOW)                   93,333          660         2.81%             98,711           623        2.50%
     Savings deposits                      131,183          954         2.89%            156,326         1,095        2.78%
     Money market accounts                  46,611          382         3.25%             53,729           375        2.77%
     Certificates of deposit               745,842       10,658         5.67%            638,673         6,617        4.11%
     Other time deposits                    89,292        1,255         5.58%             91,459         1,029        4.46%
                                     --------------  -----------                   --------------  ------------
     Total interest-bearing deposits     1,245,249       14,839         4.73%          1,182,271        10,630        3.57%
 Federal funds purchased
   and repurchase agreements                49,234          522         4.21%             39,954           297        2.95%
 Long-term debt and
   and other borrowings                     75,007        1,325         7.01%             71,444         1,045        5.80%
                                     --------------  -----------                   --------------  ------------
   Total borrowed funds                    124,241        1,847         5.90%            111,398         1,342        4.78%
                                     --------------  -----------                   --------------  ------------
 Total interest-bearing liabilities /
   interest expense                      1,369,490       16,686         4.83%          1,293,669        11,972        3.67%
                                                     -----------                                   ------------
 Non-interest-bearing liabilities:
   Non-interest-bearing deposits           167,794                                       167,830
   Other liabilities                        18,330                                         6,575
                                     --------------                                --------------
   Total liabilities                     1,555,614                                     1,468,074
 Shareholders' equity                      123,682                                       111,905
                                     --------------                                --------------
 Total liabilities
   and shareholders' equity
                                        $1,679,296                                    $1,579,979
                                     ==============                                ==============
 Net interest-rate spread                                               3.99%                                         4.25%
 Impact of non-interest bearing
   sources and other changes in
   balance sheet composition                                            0.53%                                         0.39%
                                                                  ------------                                   -----------
 Net interest income /
   margin on interest-earning                                           4.52%                          $16,954        4.64%
assets                                                  $17,536
                                                     ===========  ============                     ============  ===========
</TABLE>

Net interest margin is net interest  income divided by average  interest-earning
assets.   For  computational   purposes,   non-accrual  loans  are  included  in
interest-earning  assets.  Net  interest  spread is the  difference  between the
average rate of interest earned on interest-earning  assets and the average rate
of interest expensed on interest-bearing liabilities.
Average balances are based on daily balances.
<PAGE>

Analysis of Changes in Net Interest Income
     Shown in the following  tables are changes in interest  income and interest
expense  resulting  from changes in volumes  (average  balances)  and changes in
interest rates for the nine- and  three-month  periods ended September 30, 1995,
as compared to the same periods in 1994.

 Nine Months 1995 vs. 1994            Increase (decrease)
                                in interest income and expense
 In thousands                          due to changes in:

                                      Volume     Rate     Total
 Interest-earning assets:
Loans ............................. $  7,724  $  8,862 $ 16,586
Securities available for sale .....     (115)      928      813
Securities held to maturity .......   (2,444)      431   (2,013)
Mortgage loans held for sale ......     (392)      330      (62)
Federal funds sold
  and other interest income .......      (39)      158      119
                                    --------  -------- --------
Total interest-earning assets .....    4,734    10,709   15,443

Interest-bearing liabilities:
Interest-bearing demand (NOW) .....     (115)      211       96
TransPlus (SuperNOW) ..............     (140)      271      131
Savings deposits ..................     (529)      141     (388)
Money market accounts .............     (186)      211       25
Certificates of deposit ...........    2,933     7,643   10,576
Other time deposits ...............     (167)      721      554
                                    --------  -------- --------
  Total interest-bearing deposits .    1,796     9,198   10,994
Federal funds purchased
  and repurchase agreements .......      203       427      630
Long-term debt and
  and other borrowings ............      213       846    1,059
                                    --------  -------- --------
  Total borrowed funds ............      416     1,273    1,689
                                    --------  -------- --------
 Total interest-bearing liabilities    2,212    10,471   12,683
                                    --------  -------- --------
Increase in net interest income ... $  2,522  $    238 $  2,760
                                    ========  ======== ========

 The  change in  interest  due to both rate and  volume  has been  allocated  to
changes in average  volume and  changes in average  rates in  proportion  to the
relationship of absolute dollar amounts of the change in each.


<PAGE>



 Third Quarter 1995 vs. 1994        Increase (decrease)
                              in interest income and expense
In thousands                         due to changes in:

                                    Volume     Rate    Total
 Interest-earning assets:
Loans ............................ $ 2,898  $ 2,615  $ 5,513
Securities available for sale ....     (12)    (108)    (120)
Securities held to maturity ......    (614)     235     (379)
Mortgage loans held for sale .....     322       69      391
Federal funds sold
  and other interest income ......    (119)      10     (109)
                                   -------  -------  -------
Total interest-earning assets ....   2,475    2,821    5,296

Interest-bearing liabilities:
Interest-bearing demand (NOW) ....     (28)      67       39
TransPlus (SuperNOW) .............     (35)      72       37
Savings deposits .................    (182)      41     (141)
Money market accounts ............     (53)      60        7
Certificates of deposit ..........   1,239    2,802    4,041
Other time deposits ..............     (25)     251      226
                                   -------  -------  -------
  Total interest-bearing deposits      916    3,293    4,209
Federal funds purchased
  and repurchase agreements ......      79      146      225
Long-term debt and
  and other borrowings ...........      54      226      280
                                   -------  -------  -------
  Total borrowed funds ...........     133      372      505
                                   -------  -------  -------
Total interest-bearing liabilities   1,049    3,665    4,714
                                   -------  -------  -------
Increase (decrease)
  in net interest income ......... $ 1,426  $  (844) $   582
                                   =======  =======  =======

The change in interest due to both rate and volume has been allocated to changes
in average volume and changes in average rates in proportion to the relationship
of absolute dollar amounts of the change in each.

     The preceding  tables  reflect the general  increase in interest rates over
the  past  year.  The  tables  also  reflect  increased  volumes  of  loans  and
certificates of deposit,  while nearly all other categories of  interest-bearing
assets and liabilities have decreased.

Provision for Loan Losses
     The provision for loan losses was $2,080  thousand  (.24% of average loans,
on an annualized  basis,  excluding  mortgage  loans held for sale) in the first
nine months of 1995,  compared with $1,567  thousand  (.20% of average loans) in
the comparable  period of 1994. Net loan charge-offs were $950 thousand (.11% of
average loans) for the first nine months of 1995,  compared with $1,533 thousand
(.19% of average loans) for the first nine months of 1994.
     For the third  quarter  of 1995,  the  provision  for loan  losses was $780
thousand  (.26% of average loans,  on an annualized  basis,  excluding  mortgage
loans held for sale), compared with $555 thousand (.20% of average loans) in the
comparable  period of 1994.  Net loan  charge-offs  were $550 thousand  (.18% of
average loans) for the third quarter of 1995, and $852 thousand (.31% of average
loans) for the third quarter of 1994.
     The  provision  for loan  losses  and the level of the  allowance  for loan
losses  reflect the quality of the loan  portfolio and result from  management's
evaluation  of the  risks  in the loan  portfolio.  Further  discussion  on loan
quality and the  allowance  for loan  losses is  included  in the Asset  Quality
discussion later in this review.


<PAGE>


Non-Interest Income
     Non-interest  income  for the  first  nine  months of 1995  increased  $5.1
million over the first nine months of 1994.  Comparing the third quarter of 1995
to the comparable  period of 1994,  non-interest  income increased $1.5 million.
This  reflects  an  increase  in service  charges on  deposit  accounts  of $213
thousand,  due in  part to the  company's  repricing  of  checking  and  savings
products  which  took  effect in April of this year.  The  strong  growth in the
mortgage   servicing   portfolio   during   the   past   year   resulted   in  a
quarter-to-quarter  increase of $880  thousand of mortgage  banking  income.  An
increase  in  brokerage  income  of  $254  thousand,  reflecting  the  company's
expanding brokerage services,  accounts for most of the remaining improvement in
non-interest income.
     During the second  quarter of 1995,  the  company  realized a $1.7  million
pre-tax gain on the sale of servicing rights related to $168 million of mortgage
loans  serviced for others.  Other  mortgage  banking  income  increased  $1,791
thousand for the nine months  (which  includes $818 thousand due to the adoption
of Statement of Financial  Accounting Standards No. 122, Accounting for Mortgage
Servicing  Rights).  Brokerage  revenues  increased  $596  thousand for the nine
months,  while service charges on deposit accounts increased $780 thousand.  The
1995 increases  reflect the company's  expanding  mortgage banking and brokerage
businesses,  as well as continued improvement in its traditional line of banking
products and services.

Non-Interest Expenses
     Non-interest  expenses  increased $4.4 million for the first nine months of
1995, compared to the first nine months of 1994.  Comparing the third quarter of
1995 to the  comparable  period of 1994,  non-interest  expense  increased  $805
thousand.   Compensation   and  benefits   increased  $1.4  million,   of  which
approximately $400 thousand  represents  payments  associated with the company's
implementation of an incentive-based  compensation  system. These increases were
partially offset by a reduction in professional  fees and acquisition  costs and
the previously-mentioned FDIC refunds.
     The  increase in  non-interest  expenses  reflect the  company's  continued
investment in new technology,  product lines,  distribution channels and people,
to provide enhanced customer service and support future growth.
     The efficiency ratio (non-interest expenses as a percentage of net interest
income before provision for loan losses plus non-interest  income) for the third
quarter of 1995 was 67.8%,  versus 70.6% for the same period in 1994.  Excluding
the FDIC refunds,  the efficiency ratio for the third quarter of 1995 would have
been 70.3%.

Income Taxes
     Income tax expense  totaled  $6.0 million in the first nine months of 1995,
compared  with $5.1  million in the  comparable  1994  period.  These  represent
effective tax rates of 33.6% and 33.0%,  respectively.  For the third quarter of
1995,  income tax expense  was $2.2  million,  versus $1.9  million in the third
quarter  of  1994,   reflecting   effective   tax  rates  of  32.4%  and  32.9%,
respectively.


Balance Sheet Review
Overview
     Assets at September 30, 1995, totaled $1.715 billion,  compared with $1.618
billion at December  31,  1994,  and $1.596  billion a year ago.  Average  total
assets for the third  quarter  increased  $99 million (6%) over the past year to
$1.679  billion.  Average  interest-earning  assets  increased  $49.0 million to
$1.510 billion.

Loans
     Total loans, net of unearned  income,  averaged $1.204 billion in the third
quarter of 1995,  excluding  mortgage loans held for sale of $23.6 million.  For
the comparable period in 1994, loans averaged $1.079 million, excluding the $8.4
million of mortgage loans held for sale.
     The company  continues to experience  strong loan growth.  At September 30,
1995,  loans net of unearned  income  (excluding  mortgage  loans held for sale)
totaled $1.237  billion,  compared with $1.144 billion at December 31, 1994, and
$1.102 billion a year ago. During the first quarter of 1995, the company sold to
a  non-affiliate  bank $16  million of  participations  in its  commercial  loan
portfolio.  Excluding the impact of these participations,  loans increased at an
annualized rate of 11% from year-end 1994 to September 30, 1995.

Asset Quality
     With respect to asset quality,  management  considers  three  categories of
assets to merit additional  scrutiny.  These categories  include (a) loans which
are currently nonperforming, (b) foreclosed real estate, and (c) loans which are
currently performing but which management believes require special attention.
     Nonperforming  loans, which include  nonaccrual loans,  accruing loans past
due 90 days or more and restructured  loans,  totaled $13.1 million at September
30, 1995, up $5.2 million from  December 31, 1994,  and up $3.2 million from the
end of the third  quarter  of 1994.  The ratio of  nonperforming  loans to total
loans (net of unearned  income) was 1.06% at September  30, 1995,  compared with
 .69% at the end of 1994 and .90% a year ago. Nonperforming assets, which include
nonperforming loans and foreclosed property,  totaled $17.8 million at September
30, 1995. The ratio of  nonperforming  assets to total assets increased to 1.04%
at September 30, 1995, from .98% a year ago.
     The following table presents information  concerning  nonperforming assets,
including  nonaccrual and restructured  loans.  Management  classifies a loan as
nonaccrual  when  principal or interest is past due 90 days or more and the loan
is not adequately  collateralized and in the process of collection,  or when, in
the  opinion of  management,  principal  or interest is not likely to be paid in
accordance  with the terms of the  obligation.  Consumer  installment  loans are
charged off after 120 days of delinquency  unless adequately  secured and in the
process of collection.  Loans are not  reclassified  as accruing until principal
and interest  payments are brought  current and future  payments appear certain.
Loans are categorized as restructured if the original  interest rate,  repayment
terms,  or  both  were  restructured  due to a  deterioration  in the  financial
condition  of  the  borrower.  However,   restructured  loans  that  demonstrate
performance  under  restructured  terms and that yield a market rate of interest
may be removed from restructured status in the year following the restructure.

 Nonperforming Assets
 Dollars in thousands
 <TABLE>
<CAPTION>
                                                 September 30       June 30   December 31  September 30
                                                           1995          1995          1994          1994
<S>                                                     <C>           <C>           <C>           <C>    
 Nonaccrual loans ................................      $ 9,497       $10,032       $ 4,375       $ 6,839
 Accruing loans which are contractually
   past due 90 days or more ......................        3,625         2,609         3,514         3,003
 Restructured loans ..............................           17            22            30            34
                                                        -------       -------       -------       -------
   Total nonperforming and restructured loans ....       13,139        12,663         7,919         9,876
 Foreclosed real estate ..........................        4,115         4,367         4,998         5,156
 Other foreclosed property .......................          569           307           199           531
                                                        -------       -------       -------       -------
   Total nonperforming assets and restructured ...      $17,823       $17,337       $13,116       $15,563
loans
                                                        =======       =======       =======       =======

 Nonperforming and restructured loans
   as a percentage of net loans ..................         1.06%         1.06%         0.69%         0.90%
 Total nonperforming assets and restructured loans
   as a percentage of total assets ...............         1.04%         1.03%         0.81%         0.98%
</TABLE>

     Five  credit  relationships  account  for  $7.9  million,  or  83%,  of the
September  30,  1995,  nonaccrual  balance.  The  first of  these  loans is to a
manufacturing  firm in the amount of  $3,475,000  and is secured by all the real
estate,  equipment,  receivables  and  inventory of the company,  as well as the
personal guarantee of the owner and the pledge of some non-business-related real
estate.  The firm  experienced  cash flow  problems due to  declining  sales and
rising costs and has been unable to meet scheduled  payments in a timely manner.
The loan was placed on nonaccrual  during the second quarter of 1995. The second
loan is a $1,596,000  credit to a coal mining company secured by real estate and
equipment.  The company  experienced  operating problems and, when the owner had
severe health problems, it ceased operations.  The loan was placed on nonaccrual
in the second quarter of 1995 and the borrower has subsequently  filed a Chapter
11 bankruptcy  petition.  An orderly  liquidation  of all  collateral as well as
personal  assets of the  principal  is planned in an effort to satisfy the debt.
The third loan is to a  manufacturing  concern and is secured by commercial real
estate and equipment.  The loan has been on nonaccrual since 1992.  During 1993,
$775,000 of the loan balance was charged off, reducing the carrying value of the
loan to $1.5  million.  During the third  quarter of 1995,  the borrower  ceased
operations and has instituted an orderly  liquidation of the firm's assets.  Any
additional  loss from a collateral  shortfall is not expected to be significant.
The fourth loan has an outstanding balance of $783,000 and is secured by a first
mortgage  on  an  apartment   complex.   The  borrower   experienced  cash  flow
difficulties due to high vacancy rates, and the loan was placed on nonaccrual in
1994,  when it became  apparent  that  payments  would not  remain  timely.  The
property was sold  subsequent to September  30, 1995,  at a price  sufficient to
liquidate the principal balance.  The fifth credit,  with a balance of $595,000,
represents a 13.3%  participation  in a loan  secured by a first  mortgage on an
apartment  complex.  Increasing  vacancy  rates and unusually  high  maintenance
expenses  adversely  affected cash flow.  The credit was placed on nonaccrual in
February  1995,  when the borrower  was no longer able to make timely  payments.
Foreclosure  proceedings were instituted,  but have been delayed by the borrower
filing a bankruptcy petition.  The estimated value of the collateral is expected
to provide for the full repayment of the principal balance.  Appropriate amounts
have been  specifically  allocated in the  evaluation  of the allowance for loan
losses  for the  above  credit  exposures.  The  remaining  September  30,  1995
nonaccrual  balance consists of various  commercial and consumer loans,  with no
single loan exceeding $150,000.
     Foreclosed real estate at September 30, 1995 includes two properties with 
an aggregate book value of $2.0 million,  or 48%  of the  outstanding  balance.
  The  first  property  was  acquired  through foreclosure  in 1986
with  an  unsatisfied  loan  balance  at the  time of $1.8 million. 
In order to  facilitate  the  disposal  of the  property,  the company
entered into a joint venture with a real estate developer and developed the land
for industrial and other commercial use. During 1993, the company  dissolved the
joint venture and retained title to the property. Several parcels have been sold
above  carrying  value.  The book value of the property at  September  30, 1995,
including  development  costs,  was $1.0  million.  Based on an appraisal of the
property and previous  sales  experience,  management  does not  anticipate  any
significant loss to be incurred on disposition.  The second property included in
foreclosed real estate relates to a wood products manufacturing facility.  Based
on an appraisal of the property,  the company  wrote down its carrying  value by
$210  thousand in the third  quarter of 1994 and by another $550 thousand in the
second quarter of 1995, reducing it to its current balance of $1.0 million.  The
facility was closed in 1992 and is  presently  listed for sale with a commercial
real estate firm.  Subsequent  to September 30, 1995, a contract for the sale of
the property for $850,000 was accepted,  with closing expected prior to year-end
1995.
     As of September 30, 1995,  the company had $9.5 million of loans which were
not included in the past due,  nonaccrual or  restructured  categories,  but for
which known information about possible credit problems caused management to have
serious  doubts as to the  ability of the  borrowers  to comply with the present
loan repayment terms. Based on management's evaluation, including current market
conditions,  cash flow  generated  and  appraisals,  no  significant  losses are
anticipated  to be  incurred in  connection  with these  loans.  These loans are
subject to continuing management attention and are considered in determining the
level of the allowance for loan losses.
     The allowance for loan losses is  established  through a provision for loan
losses  charged  to  expense.  The  allowance  represents  an amount  which,  in
management's  judgment,  will be adequate to absorb  probable losses on existing
loans.  At September 30, 1995,  the allowance was $13.7  million,  up from $12.5
million at December  31, 1994,  and $12.5  million at  September  30, 1994.  The
allowance as a percentage of nonperforming  loans (an indication of the relative
ability to cover  problem  loans with  existing  reserves)  declined  to 104% at
September  30, 1995,  from 158% at year-end 1994 and 127% at September 30, 1994.
The ratio of the  allowance for loan losses to total loans  (excluding  mortgage
loans held for sale) at September  30, 1995,  was 1.10%,  compared with 1.10% at
December 31, 1994, and 1.14% at the end of 1994's third quarter.
     The adequacy of the  allowance  for loan losses is determined on an ongoing
basis through analysis of the overall quality of the loan portfolio,  historical
loan loss experience, loan delinquency trends and the economic conditions within
the company's market area.  Additional  allocations from the allowance are based
on  specifically  identified  potential loss  situations.  These  potential loss
situations  are  identified  by  account  officers'  evaluations  of  their  own
portfolios as well as by an independent loan review function.

Securities, Federal Funds Sold and Resale Agreements
     Securities,  including  those  classified as held to maturity and available
for sale,  decreased from $333 million at September 30, 1994, to $314 million at
year-end  1994,  and  $288  million  at  September  30,  1995  - the  result  of
maturities, prepayments and calls. Funds provided by the reduction in securities
were utilized to fund growth in the loan portfolio.

Deposits and Borrowed Funds
     Total  deposits  averaged  $1.413  billion in the third quarter of 1995, an
increase of $62.9 million (5%) from the comparable 1994 period. Interest-bearing
accounts increased $63.0 million, while  non-interest-bearing  accounts remained
flat over the past year.  During the first quarter of 1995,  the company  issued
$30  million  of  24-month  brokered   certificates  of  deposit  and  purchased
approximately $40 million of deposits from Fifth Third Bank of Kentucky, Inc., a
portion of which has been utilized to fund growth in the loan portfolio.
     Long-term  debt averaged $37.0 million in the third quarter of 1995, 
a decrease of $3.2 million from the third quarter of 1994.

Capital Resources and Liquidity
     The company's capital ratios at September 30, 1995,  December 31, 1994, and
September 30, 1994 (calculated in accordance with regulatory guidelines) were as
follows:

                             September 30,    December 31,   September 30,
                                     1995            1994            1994
Tier 1 risk based .....              8.95%           9.50%           9.42%
     Regulatory minimum              4.00            4.00            4.00
Total risk based ......             12.47           13.35           13.34
     Regulatory minimum              8.00            8.00            8.00
Leverage 6.94 .........              6.97            6.88
     Regulatory minimum              3.00            3.00            3.00

     Capital  ratios  of all of the  company's  subsidiaries  are in  excess  of
applicable minimum regulatory capital ratio requirements at September 30, 1995.
     Generally  speaking,  the  company  relies  upon net  inflows  of cash from
financing  activities,  supplemented  by net  inflows  of  cash  from  operating
activities,  to provide cash used in its investing activities.  As is typical of
most banking  companies,  significant  financing  activities include issuance of
common stock and long-term debt,  deposit  gathering,  and the use of short term
borrowing facilities,  such as federal funds purchased,  repurchase  agreements,
advances  from the  Federal  Home Loan Bank and lines of credit.  The  company's
primary investing  activities include loan  originations,  offset by maturities,
prepayments and sales of securities, and loan payments.
     In order to  support  internally-generated  growth  in the loan  portfolio,
TFB-KY issued  subsequent to September 30, 1995,  $20 million of two-year  notes
and $30 million of three-year notes under a $250 million Bank Note program.  The
notes  issued  to date  bear  interest  at  fixed  rates  of  6.32%  and  6.48%,
respectively,  and have been effectively  converted to floating rate instruments
through the use of interest rate swap transactions. Under these swap agreements,
TFB-KY pays interest at the prime rate and receives a fixed rate of 8.60%.  Bank
Notes  may be  issued  from  time to  time  under  this  book-entry  program  in
maturities of from 30 days to 30 years.

Asset/Liability Management
     Managing  interest  rate  risk is  fundamental  to the  financial  services
industry.  The company manages the inherently  different  maturity and repricing
characteristics  of the  lending and  deposit  acquisition  lines of business to
achieve  a  desired  interest  sensitivity  position  and to limit  exposure  to
interest rate risk. The maturity and repricing  characteristics of the company's
lending and deposit activities create a naturally asset-sensitive  structure. By
using a combination  of on- and  off-balance-sheet  financial  instruments,  the
company manages interest rate sensitivity within established policy guidelines.
     The  company's   Asset/Liability   Committee  approves  policy  guidelines,
provides oversight to the asset/liability  management process,  and monitors and
adjusts exposure to interest rates in response to loan and deposit flows.
Asset/liability   activity  is  reviewed  monthly  by  the  company's  board  of
directors.
     An earnings  simulation  model is used to monitor and evaluate the exposure
and impact of changing  interest  rates on earnings.  In today's  interest  rate
environment,  which  includes a complex array of both on- and  off-balance-sheet
financial  instruments,  traditional  static  interest  rate gap  tables  do not
provide the most comprehensive and informative  disclosures about  interest-rate
risks.  The  simulation  model used by the company  reflects the dynamics of all
interest-earning  assets,  interest-bearing  liabilities  and  off-balance-sheet
financial   instruments.   It  combines  the  various  factors   affecting  rate
sensitivity into a two-year earnings outlook that incorporates management's view
of the most likely interest rate  environment.  The model is updated monthly for
multiple interest rate scenarios, projecting changes in balance sheet categories
and other  relevant  assumptions.  In  developing  multiple rate  scenarios,  an
econometric  model is  employed  to forecast  key rates,  based on the  cyclical
nature of those rates,  with a probability  assigned to potential  future events
which might affect those rates.
     Among the factors the model  utilizes which  traditional  interest rate gap
tables do not are rate of change  differentials,  such as  federal  funds  rates
versus savings account rates, maturity effects, such as calls on securities, and
rate barrier effects, such as caps or floors on loans. It also captures changing
balance sheet levels, such as loans and investment securities, and floating rate
loans that may be tied or related to prime,  treasury  notes,  CD rates or other
rate indices,  which do not  necessarily  move  identically as rates change.  In
addition,  it captures leads and lags that occur as rates move away from current
levels,  and the  effects of  prepayments  on various  fixed rate assets such as
residential mortgages, mortgage-backed securities and consumer loans. These, and
certain other effects,  are evaluated to develop  multiple  scenarios from which
the sensitivity of earnings to changes in interest rates is determined.
     The following  illustrates  the effects on net interest  income of multiple
rate environments compared to the rate environment of September 1995 (the "flat"
scenario).  For example,  in the scenario  considered  "most likely" the company
assumed  that the  federal  funds  rate and prime rate would be 5.25% and 8.25%,
respectively,  in September of 1996,  and would be higher for four of the twelve
months from September 30, 1995 to September 30, 1996.
<TABLE>
<CAPTION>

                                                   Flat   Most Likely   Rising   Declining
Assumptions:
<S>                                                <C>       <C>         <C>        <C>  
     Federal funds rate, September 1996 ..         5.75      5.25%       8.00%      3.00%
     Prime rate, September 1996 ..........         8.75      8.25       11.00%      6.00%

Increase (decrease) in net interest income         -0-%     (0.18%      (0.51%     (1.51%)
</TABLE>

     The  company's  simulation  model  shows  that  under  each  of  the  three
scenarios,  net interest income would be lower than if rates remained  constant,
with a declining rate environment  having the greatest  negative impact.  Due to
the recent  restructuring  of the balance  sheet,  along with  off-balance-sheet
transactions,  management believes that the company's rate sensitivity  position
is  essentially  balanced at September  30, 1995,  indicating  that net interest
income would not be impacted significantly under a reasonably foreseeable rising
or falling  interest rate  scenario.  It should be noted that the results of the
simulation  model do not take into  account  any future  actions  which could be
undertaken  to reduce an adverse  impact if there were a change in interest rate
expectations or in the actual level of interest rates.
     To assist in achieving a desired  level of interest  rate  sensitivity  the
company has entered into off-balance-sheet interest rate swap transactions which
effectively  neutralize  the asset  sensitive  position which is inherent in the
balance  sheet.  The  company  pays a  variable  interest  rate on each swap and
receives a fixed rate, as shown below (as of September 30, 1995):

  Notional     Fixed Rate Floating Rate
   Amount      (Receiving)   (Paying)
$20,000,000       4.38%    5.875(LIBOR)
 30,000,000      10.40     8.75 (Prime)
 50,000,000       9.58     8.75 (Prime)
 50,000,000       9.25     8.75 (Prime)
 50,000,000       8.33     8.75 (Prime)
 50,000,000       8.50     8.75 (Prime)

     In a higher interest rate  environment,  the increased  contribution to net
interest  income  from  on-balance-sheet  assets will  substantially  offset any
negative impact on net interest income from these swap transactions. Conversely,
if interest rates decline,  these  off-balance-sheet  transactions will mitigate
the company's exposure to reduced net interest income.


<PAGE>


                           Part II - Other Information

Item 1. Legal Proceedings
     In the ordinary course of operations,  the company and its subsidiaries are
defendants in various legal proceedings. In the opinion of management,  there is
no proceeding pending or, to the knowledge of management, threatened in which an
adverse  decision  could result in a material  adverse change in the business or
consolidated financial position of the company.

Item 2 through 5.
     No information is required to be filed for these items.

Item 6. Exhibits and Reports on Form 8-K
   (a) Exhibits
       The exhibits listed on the Exhibit Index on page 21 of this Form 10-Q are
filed as a part of this report.

   (b) Reports on Form 8-K
       No  reports on Form 8-K were  filed  during  the  period  covered by this
report.


<PAGE>


                                   SIGNATURES

   Pursuant  to the  requirements  of  Section  13 or  15(d)  of the  Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                                    Trans Financial, Inc.
                                                        (Registrant)



                                                Principal Executive Officer:

Date: November 14, 1995                            /s/ Douglas M. Lester
      -----------------                            ---------------------
                                                       Douglas M. Lester
                                               Chairman of the Board, President
                                                    and Chief Executive Officer


                                                Principal Financial Officer:


Date: November 14, 1995                            /s/ Edward R. Matthews
      -----------------                            ----------------------
                                                       Edward R. Matthews
                                                       Chief Financial Officer


<PAGE>


==============================================================================
==============================================================================
39




                                            Exhibits
                                                                  Sequentially
                                                                 Numbered Pages

   4(a)    Restated Articles of Incorporation of the registrant are incorporated
           by reference to Exhibit 4(a) of the registrant's  report on Form 10-Q
           for the quarter ended March 31, 1995.

   4(b)    Articles of Amendment to the Restated  Articles of  Incorporation  of
           the registrant are  incorporated  by reference to Exhibit 4(b) of the
           registrant's  report on Form  10-Q for the  quarter  ended  March 31,
           1995.

   4(c)    Restated  Bylaws of the registrant are  incorporated  by reference to
           Exhibit  4(b) of the  registrant's  report  on Form 10-K for the year
           ended December 31, 1993.

   4(d)    Rights Agreement dated January 20, 1992 between Manufacturers Hanover
           Trust Company (subsequently  assigned to First Union National Bank of
           North  Carolina) and the registrant is  incorporated  by reference to
           Exhibit 1 to the  registrant's  report on Form 8-K dated  January 24,
           1992.

   4(e)    Form of Indenture  (including Form of Subordinated  Note) dated as of
           September 1, 1993,  between the registrant  and First  Tennessee Bank
           National  Association  as Trustee,  relating to the issuance of 7.25%
           Subordinated  Notes due 2003, is incorporated by reference to Exhibit
           4 of the  Registration  Statement on Form S-2 of the registrant (File
           No. 33-67686).

   10(a)   Distribution Agreement dated September 28, 1995 between Registrant,
           Trans Financial Bank, N.A. and Donaldson, Lufkin & Jenrette
           Securities Corporation............................................22

   10(b)   Fiscal and Paying Agency Agreement dated September 28, 1995 between
           Trans Financial Bank, N.A. and First Fidelity Bank, N.A...........62

   11      Statement Regarding Computation of Per Share Earnings............127

*  Denotes a management  contract or  compensatory  plan or  arrangement  of the
   registrant required to be filed as an exhibit pursuant to Item 601 (10) (iii)
   of Regulation S-K.


<PAGE>
[TYPE]EX-10

 Exhibit 10(a).


                                U.S. $250,000,000

                   TRANS FINANCIAL BANK, NATIONAL ASSOCIATION

                       SENIOR AND SUBORDINATED BANK NOTES

                             DISTRIBUTION AGREEMENT



September 28, 1995






Donaldson, Lufkin & Jenrette
 Securities Corporation
140 Broadway
New York, New York  10005

Dear Sirs:

      Trans  Financial  Bank,  National   Association  (the  "Bank")  and  Trans
Financial,  Inc.  (the  "Corporation")  confirm  their  agreement  with you (the
"Agent")  with  respect to the  issuance and sale by the Bank of its senior bank
notes and subordinated  bank notes  (collectively,  the "Notes") in an aggregate
principal amount outstanding at any one time not in excess of $250,000,000,  due
from 30 days to 30 years  from  their  date of issue in the case of senior  bank
notes  and  from 5 years  to 30 years  from  their  date of issue in the case of
subordinated  bank notes.  The Bank may  authorize the issuance of an additional
outstanding amount of Notes to be distributed  hereunder as though authorized as
of the date hereof.  The Notes are to be issued from time to time  pursuant to a
fiscal and paying agency agreement, dated as of September 28, 1995 (as it may be
supplemented  or  amended  from time to time,  the  "Fiscal  and  Paying  Agency
Agreement"),  between  the Bank and First  Fidelity  Bank,  N.A.,  as fiscal and
paying agent (the "Fiscal and Paying Agent").

      The Notes  shall  have the  applicable  interest  rates or  interest  rate
formulas,  issue price,  redemption and repayment provisions and other terms set
forth in the Offering Circular referred to in Section 1(a), as it may be amended
or supplemented  from time to time,  including any supplement  providing for the
interest  rate,  maturity and other terms of any Note (a "Pricing  Supplement").
The Notes will be issued, and the terms thereof established,  from time to time,
by the Bank in accordance  with the Fiscal and Paying  Agency  Agreement and the
Procedures  referred to below.  This Agreement  shall only apply to sales of the
Notes and not to sales of any other  securities or evidences of  indebtedness of
the Bank and only on the specific terms set forth herein.

      Subject to the terms and conditions  stated herein and to the  reservation
by the Bank of the right to sell  Notes  directly  on its own  behalf,  the Bank
hereby  (i)  appoints  the  Agent as the  agent of the Bank for the  purpose  of
soliciting and receiving  offers to purchase Notes from the Bank and (ii) agrees
that  whenever  the Bank  determines  to sell  Notes  directly  to the  Agent as
principal  it  will  enter  into  a  separate   agreement   (each,  a  "Purchase
Agreement").  Each such Purchase Agreement, which shall be confirmed in writing,
shall be with  respect to such  information  (as  applicable)  as  specified  in
Exhibit C hereto relating to such sale in accordance with Section 3(e) hereof.

      .  Representations and Warranties of the Bank.
            The Bank represents and warrants to the Agent as of the date hereof,
as of the Closing  Date (as defined  herein) and as of the times  referred to in
Sections  7(a) and 7(b)  hereof  (the  Closing  Date and each  such  time  being
hereinafter sometimes referred to as a "Representation Date"), as follows:

           (a) The  Bank  has  prepared  an  offering  circular  (such  offering
      circular,  together with the documents  now or hereafter  incorporated  by
      reference  therein (the  "Incorporated  Documents"),  and as such offering
      circular  may  hereafter  be  amended  or   supplemented,   the  "Offering
      Circular")  to be  used  by the  Agent  in  connection  with  the  Agent's
      solicitation  of  purchasers  of or offering of the Notes (as used herein,
      any reference to an amendment or supplement of or to the Offering Circular
      shall be  deemed to  include  any  document  which is, by the terms of the
      Offering Circular, incorporated by reference therein);

           (b) Each of the Incorporated  Documents  heretofore filed by the Bank
      with the Federal Deposit Insurance  Corporation ("FDIC"), on behalf of the
      Office of the  Comptroller  of Currency or other  federal bank  regulatory
      authority   complied  in  all  material   respects  with  the   applicable
      requirements of the FDIC or such other federal bank  regulatory  authority
      and of the Federal Financial  Institutions  Examination Council ("FFIEC"),
      and none of such  Incorporated  Documents,  when so  filed,  contained  an
      untrue  statement of a material  fact or omitted to state a material  fact
      required to be stated therein or necessary in order to make the statements
      therein,  in the light of the  circumstances  in which they were made, not
      misleading;  any Incorporated  Documents  hereafter filed with the FDIC or
      other federal bank regulatory  authority and  incorporated by reference in
      the Offering Circular, when such documents are filed with the FDIC or such
      other  federal  bank  regulatory  authority,  will comply in all  material
      respects  with  the  applicable  requirements  of the  FDIC or such  other
      federal bank  regulatory  authority  and the FFIEC and will not contain an
      untrue  statement  of a  material  fact or omit to state a  material  fact
      required to be stated therein or necessary in order to make the statements
      therein,  in the light of the  circumstances  in which they were made, not
      misleading;  the  financial  data  relating  to the Bank set  forth in the
      Offering Circular and in any Incorporated Documents filed with the FDIC or
      other federal bank  regulatory  authority  present fairly (or will present
      fairly,  when so filed with the FDIC or such other federal bank regulatory
      authority) in all material  respects the consolidated  financial  position
      and results of operations of the Bank and its consolidated subsidiaries at
      the  respective  dates  and for the  respective  periods  for  which  such
      information  is  shown,   in  each  case  in  accordance  with  regulatory
      accounting  principles  promulgated  by  the  FFIEC  consistently  applied
      throughout the periods involved except as otherwise disclosed therein;

           (c) The Offering Circular does not, and will not as of the applicable
      Representation  Date,  contain an untrue statement of a material fact with
      respect to the Bank or the  offering of Notes by the Bank or omit to state
      a material  fact with  respect to the Bank or the offering of Notes by the
      Bank  required  to be stated  therein  or  necessary  in order to make the
      statements  therein,  in the light of the  circumstances  under which they
      were made, not misleading; provided, however, that the representations and
      warranties in this paragraph shall not apply to statements in or omissions
      from the Offering  Circular made in reliance  upon and in conformity  with
      information  furnished to the Bank in writing by the Agent  expressly  for
      use therein;

           (d) The Bank and each of its significant  subsidiaries (as defined in
      Regulation S-X of the rules and regulations of the Securities and Exchange
      Commission (the "Commission"), hereinafter "significant subsidiaries") has
      been duly  organized and is validly  existing in good  standing  under the
      laws  of  its  jurisdiction  of  organization  with  power  and  authority
      (corporate  and other) to own its  properties  and conduct its business as
      described  in the  Offering  Circular,  and has been duly  qualified  as a
      foreign  corporation  for  the  transaction  of  business  and is in  good
      standing  under the laws of each  jurisdiction  in which it owns or leases
      properties, or conducts any business, so as to require such qualification,
      other than where the failure to be so qualified or in good standing  would
      not have a material adverse effect on the Bank and its subsidiaries  taken
      as a  whole;  and  all of the  issued  shares  of  capital  stock  of each
      significant  subsidiary of the Bank have been duly  authorized and validly
      issued,  are fully  paid and  non-assessable,  and are owned  directly  or
      through subsidiaries by the Bank, free and clear of any mortgage,  pledge,
      lien, claim or encumbrance;

           (e) Each of this Agreement, any applicable Purchase Agreement and the
      Fiscal and Paying Agency Agreement has been duly authorized,  executed and
      delivered by the Bank and constitutes  the valid and binding  agreement of
      the Bank  enforceable  in accordance  with its terms,  except as rights to
      indemnity  and  contribution  hereunder  or  thereunder  may be limited by
      applicable federal or state securities laws;

           (f) The Notes to be issued by the Bank have been duly authorized and,
      when issued in accordance  with the terms and provisions of the Fiscal and
      Paying Agency  Agreement  and delivered to and paid for by the  purchasers
      thereof in  accordance  with this  Agreement and any  applicable  Purchase
      Agreement,  will have been duly executed, issued and delivered by the Bank
      and will constitute valid and binding  obligations of the Bank enforceable
      in  accordance  with their terms and entitled to the benefits  provided by
      the Fiscal  and  Paying  Agency  Agreement;  the Fiscal and Paying  Agency
      Agreement  has been  duly  authorized  by the Bank and duly  executed  and
      delivered  by the Bank and  constitutes  a valid  and  binding  instrument
      enforceable  against the Bank in accordance with its terms; and the Fiscal
      and Paying  Agency  Agreement  conforms,  and the Notes of any  particular
      issuance of Notes of the Bank will conform, to the descriptions thereof in
      the Offering Circular as amended or supplemented, if applicable, to relate
      to such issuance of Notes;

           (g)  Neither  the Bank nor any of its  subsidiaries  is,  or with the
      giving of notice or lapse of time or both would be, in  violation of or in
      default under (i) any indenture,  mortgage,  deed of trust, loan agreement
      or other  agreement or instrument to which the Bank or any such subsidiary
      is a party or by which it or any of its  properties  is bound  except  for
      violations  and defaults  which  individually  or in the aggregate are not
      material  to the  Bank and its  subsidiaries  taken as a whole or (ii) its
      charter or by-laws;  the issue and sale of such Notes and the  performance
      by the Bank of all of its  obligations  under such  Notes,  the Fiscal and
      Paying Agency Agreement,  this Agreement and any Purchase  Agreement,  and
      the consummation of the transactions herein and therein contemplated, will
      not conflict  with or result in a breach of any of the terms or provisions
      of, or constitute a default under, any indenture, mortgage, deed of trust,
      loan  agreement or other  agreement or instrument to which the Bank or any
      of  its  subsidiaries  is a  party  or by  which  the  Bank  or any of its
      subsidiaries  is bound or to which  any of the  property  or assets of the
      Bank or any of its subsidiaries is subject, nor will such action result in
      any violation of the  provisions of the charter or the by-laws of the Bank
      or any applicable law or any order, rule or regulation of any court or any
      state or federal  bank  regulatory  or other  governmental  agency or body
      having  jurisdiction  over  the  Bank,  its  subsidiaries  or  any  of its
      properties; and no consent, approval,  authorization,  order, registration
      or  qualification  of or with any such  court or any such state or federal
      bank regulatory or other  governmental  agency or body is required for the
      issue and sale of such Notes or the  consummation by the Bank of the other
      transactions  contemplated  by this Agreement or any  applicable  Purchase
      Agreement or the Fiscal and Paying Agency Agreement, except such consents,
      approvals,  authorizations,  registrations  or  qualifications  as  may be
      required under state securities or Blue Sky laws or the regulations of the
      Office of the Comptroller of the Currency in connection with the offer and
      sale of the Notes;

           (h) Other than as set forth in the  Offering  Circular,  there are no
      legal or  governmental  proceedings  pending or, to the  knowledge  of the
      Bank,  threatened  or  contemplated  to  which  the  Bank  or  any  of its
      subsidiaries  is or may be a party or to which any property of the Bank or
      any of its subsidiaries is or may be the subject which might  individually
      or in the  aggregate  reasonably  be expected  to have a material  adverse
      effect  on  the  general   affairs,   business,   prospects,   management,
      consolidated  financial  position,  stockholders'  equity  or  results  of
      operations of the Bank and its subsidiaries taken as a whole;

           (i)  Immediately  after  any sale of Notes by the Bank  hereunder  or
      under any applicable  Purchase  Agreement,  the aggregate  amount of Notes
      which shall have been issued and sold by the Bank  hereunder  or under any
      Purchase Agreement will not exceed $250,000,000;

           (j) The Notes are  exempt  securities  under  Section  3(a)(2) of the
      Securities  Act of 1933, as amended (the  "Securities  Act"),  and neither
      registration of the Notes under the Securities Act nor qualification of an
      indenture  under the Trust  Indenture  Act of 1939, as amended (the "Trust
      Indenture Act"), is required in connection with the offer, sale,  issuance
      or delivery of the Notes as contemplated by this Agreement;

           (k) The Bank is an insured bank under the  provisions  of the Federal
      Deposit Insurance Act, as amended,  and no proceedings for the termination
      of such insurance are pending or threatened; and

           (l) All of the  shares  of  capital  stock  of the Bank  (other  than
      directors'  qualifying shares, if any) are owned by the Corporation either
      directly or through wholly-owned subsidiaries of the Corporation.

      SECTION 2  .  REPRESENTATIONS AND WARRANTIES OF THE CORPORATION.
            The Corporation  represents and warrants to the Agent as of the date
hereof, as of the Closing Date and as of each Representation Date as follows:

           (a)     The Corporation has  participated in the preparation of the
      Offering  Circular to be used by the Agent in connection with the Agent's
      solicitation of purchasers of or offering of the Notes;

           (b)  The  Corporation  has  authorized  the  Bank to  incorporate  by
      reference in the Offering  Circular  reports and other  documents filed by
      the Corporation  with the Commission  pursuant to the Securities  Exchange
      Act  of  1934,  as  amended  (the  "Exchange  Act"),  and  the  rules  and
      regulations  of the  Commission  thereunder;  and each  such  Incorporated
      Document  complied,  or when filed with the Commission will comply, in all
      material  respects  with  the  requirements  of the  Exchange  Act and the
      applicable rules and regulations of the Commission thereunder;

           (c)  The  Offering  Circular  does  not,  and  as of  the  applicable
      Representation  Date will not,  contain an untrue  statement of a material
      fact with respect to the Corporation or omit to state a material fact with
      respect to the  Corporation  required to be stated therein or necessary in
      order to make the statements  therein,  in the light of the  circumstances
      under which they were made, not misleading;  provided,  however,  that the
      representations  and  warranties  in this  paragraph  shall  not  apply to
      statements  in or omissions  from the Offering  Circular  made in reliance
      upon and in conformity with  information  furnished to the Bank in writing
      by the Agent expressly for use therein;

           (d) The financial statements, together with the related schedules and
      notes thereto,  and other  financial data relating to the  Corporation set
      forth in the Offering  Circular and in any  Incorporated  Documents  filed
      with the Commission present fairly (or will present fairly,  when so filed
      with the Commission) in all material  respects the consolidated  financial
      position and results of operations of the Corporation and its consolidated
      subsidiaries  at the respective  dates and for the respective  periods for
      which such information is shown, in each case in accordance with generally
      accepted accounting principles consistently applied throughout the periods
      shown, except as otherwise disclosed therein;
           (e) This Agreement has been duly  authorized,  executed and delivered
      by the Corporation and constitutes the valid and binding  agreement of the
      Corporation  enforceable in accordance with its terms, except as rights to
      indemnity and contribution  hereunder may be limited by applicable federal
      or state securities laws; and

           (f) Neither the Corporation nor any of its  subsidiaries  is, or with
      the giving of notice or lapse of time or both would be, in violation of or
      in  default  under,  (i) any  indenture,  mortgage,  deed of  trust,  loan
      agreement or other agreement or instrument to which the Corporation or any
      of its  subsidiaries is a party or by which it or any of its  subsidiaries
      is bound or to which any of the property or assets of the  Corporation  or
      any of its  subsidiaries  is subject,  except for  violations and defaults
      which individually or in the aggregate are not material to the Corporation
      and its subsidiaries taken as a whole or (ii) its charter or by-laws;  the
      performance  by the  Corporation  of all of  its  obligations  under  this
      Agreement,  and the consummation of the transactions herein  contemplated,
      will  not  conflict  with or  result  in a breach  of any of the  terms or
      provisions  of, or constitute a default under,  any  indenture,  mortgage,
      deed of trust,  loan  agreement or other  agreement or instrument to which
      the  Corporation  or any of its  subsidiaries  is a party or by which  the
      Corporation  or any of its  subsidiaries  is bound or to which  any of the
      property  or  assets  of the  Corporation  or any of its  subsidiaries  is
      subject, nor will such action result in any violation of the provisions of
      the charter or the by-laws of the Corporation or any applicable law or any
      order,  rule or  regulation  of any  court or any  state or  federal  bank
      regulatory or other governmental  agency or body having  jurisdiction over
      the  Corporation,  its  subsidiaries  or  any of  its  properties;  and no
      consent, approval, authorization,  order, registration or qualification of
      or with any such  court or any such state or federal  bank  regulatory  or
      other governmental  agency or body is required for the consummation by the
      Corporation  of the other  transactions  contemplated  by this  Agreement,
      except  such  consents,   approvals,   authorizations,   registrations  or
      qualifications  as may be required under state securities or Blue Sky laws
      in connection with the offer and sale of the Notes.

      SECTION 3  .  SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL.
      (a) Subject to the terms and  conditions  stated  herein,  the Bank hereby
appoints  the Agent as the agent of the Bank for the  purpose of  soliciting  or
receiving offers to purchase the Notes from the Bank by others.  On the basis of
the  representations  and warranties  contained herein, but subject to the terms
and conditions  herein set forth, the Agent agrees, as the agent of the Bank, to
use its  reasonable  efforts to solicit  offers to  purchase  the Notes upon the
terms and conditions set forth in the Offering  Circular.  It is understood that
if from time to time the Bank is approached by a prospective  agent  offering to
solicit a specific  purchase  of Notes,  the Bank,  may  engage  such agent with
respect to such  specific  purchase;  provided that the Agent is given notice of
such  purchase  promptly,  including the terms  thereof,  in each case after the
purchase is agreed upon; provided further, however that such agent shall make in
writing the representations and agreements of an Agent set forth herein and that
the Bank and such  agent  shall  otherwise  agree to be bound by the  terms  and
conditions of this Agreement. The Agent may also purchase Notes from the Bank as
principal  for purposes of resale,  as more fully  described in paragraph (e) of
this Section.

      (b) The Bank  reserves  the  right,  in its sole  discretion,  to  suspend
solicitation  of offers to purchase Notes  commencing at any time for any period
of time or  indefinitely.  Upon  receipt of at least one  business  day's  prior
written notice from the Bank, the Agent will forthwith  suspend  solicitation of
offers to  purchase  Notes from the Bank until such time as the Bank has advised
the  Agent  that  such  solicitation  may be  resumed.  For the  purpose  of the
foregoing sentence, "business day" shall mean any day which is not a Saturday or
Sunday and which is not a day on which (i) banking  institutions  are  generally
authorized  or obligated by law to close in The City of New York or (ii) The New
York Stock Exchange, Inc. is closed for trading.

                 Upon  receipt of notice from the Bank as  contemplated  by this
Section 3(b), the Agent shall suspend its solicitation of offers to purchase the
Notes until such time as the Bank shall have  furnished  it with an amendment or
supplement to the Offering Circular contemplated by Section 4(b), if required by
the terms of such  Section,  and the Bank shall have advised the Agent that such
solicitation may be resumed.

      (c) Promptly upon the closing of the sale of any Notes sold by the Bank as
a result of a solicitation  made by or offer to purchase  received by the Agent,
the Bank agrees to pay the Agent a  commission,  in the form of a  discount,  in
accordance with the schedule set forth in Exhibit A hereto.

      (d) The Agent is authorized  to solicit  offers to purchase the Notes only
in such  denominations  as are specified in the Offering  Circular at a purchase
price as shall be  specified  by the Bank.  The Agent shall  communicate  to the
Bank, orally or in writing,  each reasonable offer to purchase Notes received by
it as an Agent.  The Bank shall have the sole right to accept offers to purchase
such Notes and may reject  any such offer in whole or in part.  The Agent  shall
have the right,  in its discretion  reasonably  exercised  without  advising the
Bank,  to reject any offer to purchase the Notes  received by it, in whole or in
part,  and any such  rejection  shall not be  deemed a breach  of its  agreement
contained herein.

                 No Note  which  the Bank has  agreed to sell  pursuant  to this
Agreement  shall be deemed to have been  purchased  and paid for, or sold by the
Bank, until such Note shall have been delivered to the purchaser thereof against
payment by such purchaser.

      (e) Each sale of Notes to the  Agent as  principal,  for  resale to one or
more investors or to another  broker-dealer (acting as principal for purposes of
resale),  shall be made in  accordance  with the terms of this  Agreement  and a
Purchase Agreement,  which shall be confirmed in writing, which will provide for
the sale of such Notes to, and the  purchase  thereof by, the Agent.  A Purchase
Agreement may also specify certain provisions relating to the reoffering of such
Notes by the Agent.  The commitment of the Agent to purchase Notes from the Bank
as  principal   shall  be  deemed  to  have  been  made  on  the  basis  of  the
representations and warranties of the Bank herein contained and shall be subject
to the terms and  conditions  herein set forth.  Each Purchase  Agreement  shall
specify the principal  amount and terms of the Notes of the Bank to be purchased
by the  Agent,  the time and date (each  such time and date  being  referred  to
herein as a "Time of  Delivery")  and place of  delivery of and payment for such
Notes and such other  information  (as  applicable) as is set forth in Exhibit C
hereto.  The Bank agrees that if the Agent  purchases its Notes as principal for
resale the Agent shall receive such  compensation,  in the form of a discount or
otherwise,  as shall be indicated in the applicable Purchase Agreement or, if no
compensation  is indicated  therein,  a commission in accordance  with Exhibit A
hereto.  The Agent may utilize a selling or dealer group in connection  with the
resale  of such  Notes.  In  addition,  the  Agent  may  offer  the Notes it has
purchased as principal to other dealers.  The Agent may sell Notes to any dealer
at a  discount  and,  unless  otherwise  specified  in  an  applicable  Purchase
Agreement,  such discount allowed to any dealer will not be in excess of 66-2/3%
of the discount or  commission  to be received by the Agent from the Bank.  Such
Purchase  Agreement shall also specify any requirements for delivery of opinions
of counsel and officers' certificates pursuant to Section 6 hereof.

      (f)  Administrative   procedures  relating  to  the  sale  of  Notes  (the
"Procedures")  are set forth in  Exhibit B hereto  and may be amended in writing
from time to time by agreement between the Agent and the Bank. The Agent and the
Bank  agree to  perform  the  respective  duties  and  obligations  specifically
provided  to be  performed  by each of them  herein and in the  Procedures.  The
Procedures shall apply to all  transactions  contemplated  hereunder,  including
sales of Notes to the  Agent as  principal  pursuant  to a  Purchase  Agreement,
unless otherwise set forth in such Purchase Agreement.

      (g) The documents required to be delivered pursuant to Section 6 hereof on
the Closing Date (as defined below) shall be delivered at the offices of Simpson
Thacher & Bartlett,  425 Lexington  Avenue,  New York, New York 10017,  at 10:00
A.M., New York City time, on the date of this Agreement,  which date and time of
such  delivery may be postponed by agreement  between the Agent and the Bank but
in no event shall be later than the day prior to the date on which  solicitation
of offers to purchase  Notes is commenced  (such time and date being referred to
herein as the "Closing Date").

      SECTION 4  .  COVENANTS OF THE BANK.
            The Bank covenants and agrees with the Agent:

      (a) To make no amendment or supplement to the Offering Circular (excluding
Incorporated  Documents)  prior to the  Closing  Date or the  date on which  any
Purchase  Agreement is executed  which shall be  disapproved by the Agent in its
reasonable  discretion  promptly after reasonable  notice thereof,  or after the
date of any Purchase  Agreement and prior to the related Time of Delivery  which
shall be disapproved by the Agent promptly after reasonable notice thereof,  and
to make no such  amendment  or  supplement  at any  other  time  prior to having
afforded  the Agent a  reasonable  opportunity  to review and comment on it. The
Bank will advise the Agent as promptly as practicable of the  institution by any
federal or state bank or securities  regulatory  authority of any proceedings in
respect of the  Offering  Circular  (including  any  proceeding  relating to any
Incorporated  Documents)  or the  offering of Notes and will use its  reasonable
best efforts to prevent the issuance of any order  interfering with the offering
of such Notes and to obtain as soon as possible its lifting, if issued.

      (b) To furnish the Agent with  copies of the  Offering  Circular  and each
amendment or supplement  thereto in such  quantities as the Agent may reasonably
request from time to time;  and if at any time while this Agreement is in effect
or, in the event this Agreement is terminated,  at any time the Agent is holding
Notes it purchased as a principal,  any event shall have occurred as a result of
which the Offering  Circular as then amended or  supplemented  would  include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements  therein,  in the
light of the circumstances under which they were made, not misleading, or if for
any other reason it shall be  necessary or required  during such period to amend
or  supplement  the  Offering  Circular,  the Bank  shall  notify  the  Agent by
telephone,  with confirmation in writing, to suspend  solicitations of offers to
purchase  Notes,  and upon the request of the Agent,  shall  prepare and furnish
without  charge to the Agent and to any person  designated  by the Agent as many
copies  as the  Agent may from time to time  reasonably  request  of an  amended
Offering  Circular or a supplement to the Offering  Circular  which will correct
such statement or omission.

      (c) To advise  the Agent  immediately  (i) of  receipt  by the Bank of any
notification  with respect to the suspension of the  qualification of the Bank's
Notes for sale in any jurisdiction or the initiation or threat of any proceeding
for that purpose and (ii) of any  downgrading in the rating of such Notes or any
other debt  securities  or  deposits of the Bank or any debt  securities  of the
Corporation,  or any proposal to downgrade the rating of such Notes or any other
debt  securities  or  deposits  of  the  Bank  or  any  debt  securities  of the
Corporation,  by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g)  under the  Securities  Act),  or any public
announcement  that any such  organization  has under  surveillance or review its
rating of any debt  securities or deposits of the Bank or any debt securities of
the  Corporation  (other than an  announcement  with positive  implications of a
possible upgrading, and no implication of a possible downgrading of such rating)
as soon as the Bank or the Corporation learns of any such downgrading,  proposal
to downgrade or public announcement.

      (d) To  endeavor,  in  cooperation  with the Agent,  to qualify the Bank's
Notes for offering and sale under the securities laws of such  jurisdictions  as
the Agent may designate,  and to maintain such  qualifications  in effect for as
long as may be required  for the  distribution  of such Notes;  and to file such
statements  and reports as may be required by the laws of each  jurisdiction  in
which such Notes have been qualified as above provided.

      (e) To  prepare  with  respect  to any Notes to be sold  through or to the
Agent  pursuant to this  Agreement,  a Pricing  Supplement  with respect to such
Notes in a form previously approved by the Agent.

           (f) To furnish the Agent with copies of any  Incorporated  Documents,
promptly,  after the filing  thereof,  at any time while  this  Agreement  is in
effect or, in the event this Agreement is  terminated,  at any time the Agent is
holding Notes it purchased as a principal.

      (g) In the  event  subordinated  Notes  are to be  issued,  to  prepare  a
supplement to the Offering Circular in a form reasonably acceptable to the Agent
which shall include the terms of such Notes.



      SECTION 5  .  PAYMENT OF EXPENSES.
            The Bank agrees to pay or cause to be paid:

            (i)       the costs  incident to the  authorization,  issuance, 
      sale and delivery of the Notes and any taxes payable in that connection;

           (ii)       the  costs  incident  to the  preparation  and  printing
      of the  Offering  Circular  and any
      amendments and supplements thereto and the mailing and delivery of copies 
      thereof to the Agent;

          (iii) the fees and  expenses  of the Fiscal  and Paying  Agent and any
      agent of the  Fiscal and Paying  Agent and the fees and  disbursements  of
      counsel to the Fiscal and Paying  Agent or such agent in  connection  with
      the Fiscal and Paying Agency Agreement and the Notes;

           (iv)       the cost and fees in connection with any filings with the
      National  Association of Securities Dealers, Inc.;

           (v)        the fees and disbursements of counsel to the Corporation,
      the Bank and counsel to the Agent;  provided that the fees and 
      disbursements of counsel to the Agent shall not exceed $60,000;

           (vi)       the fees paid to rating agencies in connection with the
      rating of the Notes;

          (vii)       the fees and  expenses  of  qualifying  the Notes  under 
      the  securities  laws of the several jurisdictions as provided in
      Section 4(d) hereof;

         (viii)       all advertising  expenses in connection with the offering
      of the Notes incurred in accordance with the Procedures; and

           (ix) all other costs and  expenses  arising  out of the  transactions
      contemplated  hereunder and incident to the performance of the obligations
      of the Bank under this  Agreement  or  otherwise  in  connection  with the
      activities of the Agent under this Agreement.

      SECTION 6  .  CONDITIONS OF OBLIGATIONS OF AGENT.
            The  obligation of the Agent,  as the agent of the Bank,  under this
Agreement to solicit offers to purchase the Notes,  the obligation of any person
who has agreed to purchase Notes to make payment for and take delivery of Notes,
and the  obligation  of the Agent to purchase  Notes  pursuant  to any  Purchase
Agreement,  is subject to the  accuracy,  on each  Representation  Date,  of the
representations and warranties of the Corporation and the Bank contained herein,
to the accuracy of the  statements  of the officers of the  Corporation  and the
Bank made in any certificate furnished pursuant to the provisions hereof, to the
performance  by the  Bank  of its  obligations  hereunder,  and to  each  of the
following additional terms and conditions:

      (a) No  order  suspending  the  sale  of  the  Notes  in any  jurisdiction
designated by the Agent  pursuant to Section 4(d) hereof shall have been issued,
and no proceeding for that purpose shall have been initiated or threatened.

      (b) The Agent shall not have discovered and disclosed to the Bank that the
Offering  Circular  contains an untrue statement of a fact which, in the opinion
of counsel for the Agent,  is  material  or omits to state a fact which,  in the
opinion of such counsel,  is material and is required to be stated therein or is
necessary to make the statements therein not misleading.

      (c) All  corporate  proceedings  and other legal  matters  incident to the
authorization,  form and  validity of this  Agreement,  the Notes,  the Offering
Circular  (other than  financial  statements and other  financial  data) and all
other legal matters relating to this Agreement and the transactions contemplated
hereby shall be satisfactory  in all respects to counsel for the Agent,  and the
Corporation  and the Bank shall have furnished to such counsel all documents and
information  that they may  reasonably  request to enable them to pass upon such
matters.

      (d) At the  Closing  Date,  the Agent  shall have  received  an opinion or
opinions,  addressed to the Agent and dated the Closing Date, of Wyatt Tarrant &
Combs, counsel to the Bank, in form and substance  satisfactory to the Agent and
their counsel, to the effect that:

            (i) The Corporation and the Bank has each been duly organized and is
      validly  existing and in good standing under the laws of its  jurisdiction
      of organization, with power and authority (corporate and other) to own its
      properties and conduct its business as described in the Offering Circular;

           (ii)  Each  of  the   Corporation's   and  the   Bank's   significant
      subsidiaries,  if any, has been duly  incorporated and is validly existing
      and in good standing as a corporation  under the laws of its  jurisdiction
      of incorporation with power and authority (corporate and other) to own its
      properties and conduct its business as described in the Offering Circular;
      all of the  outstanding  shares of capital  stock of the Bank  (other than
      directors' qualifying shares, if any) are owned of record and, to the best
      knowledge of such counsel, beneficially by the Corporation either directly
      or through wholly-owned  subsidiaries;  and, to the best of such counsel's
      knowledge,  all of the issued shares of capital stock of each  significant
      subsidiary of the  Corporation  and of the Bank have been duly  authorized
      and validly issued, are fully paid and  non-assessable  (subject to 12 USC
      ss.55 in the case of the Corporation's  national bank  subsidiaries),  and
      except for  directors'  qualifying  shares,  if any, are owned directly or
      through  subsidiaries  by the Corporation or the Bank, as the case may be,
      free and clear, to the best of such counsel's knowledge,  of any mortgage,
      pledge, lien, claim or encumbrance;

          (iii) The Bank has the  power  and  authority  (corporate  and  other)
      necessary  to execute and deliver  this  Agreement,  the Fiscal and Paying
      Agency Agreement and any applicable  Purchase Agreement and to perform its
      obligations  hereunder and thereunder  (including the sale and delivery of
      the Notes under this Agreement);  this Agreement,  any applicable Purchase
      Agreement  and the  Fiscal  and  Paying  Agency  Agreement  have been duly
      authorized,  executed and delivered by the Bank; and the Fiscal and Paying
      Agency  Agreement is a valid and legally  binding  obligation  of the Bank
      enforceable in accordance with its terms,  except as any rights thereunder
      to indemnity  and  contribution  may be limited by  applicable  federal or
      state securities laws;

           (iv) The  Corporation  has the power  and  authority  (corporate  and
      other)  necessary to execute and deliver this Agreement and to perform its
      obligations hereunder;  this Agreement has been duly authorized,  executed
      and delivered by the Corporation;

           (v) The Notes are in the form  contemplated  by the Fiscal and Paying
      Agency  Agreement  and the Bank's Notes have been duly  authorized  by all
      necessary  corporate  action  and,  when  executed  and  authenticated  in
      accordance  with the terms of the Fiscal and Paying  Agency  Agreement and
      delivered to and paid for by any  purchaser of such Notes sold through the
      Agent as  agent or by the  Agent as  principal  pursuant  to any  Purchase
      Agreement,  will constitute  legal,  valid and binding  obligations of the
      Bank  enforceable  in  accordance  with their  terms and  entitled  to the
      benefits provided by the Fiscal and Paying Agency Agreement;

           (vi)  To  the  best  of  such  counsel's   knowledge,   none  of  the
      Corporation,  the Bank or any of their respective significant subsidiaries
      (if any) is, or with the  giving of notice or lapse of time or both  would
      be, in  violation  of or in default  under,  its charter or by-laws or any
      indenture,  mortgage,  deed of trust, loan agreement or other agreement or
      instrument to which the Corporation or the Bank or any of their respective
      significant  subsidiaries  is a party or by which it or any of them or any
      of their respective properties is bound, except for violations or defaults
      which individually or in the aggregate are not material to the Corporation
      or the Bank, as the case may be, and its significant subsidiaries taken as
      a whole;

          (vii) The issue and sale of the Notes and the  performance by the Bank
      of  its  obligations   under  the  Notes,  the  execution,   delivery  and
      performance of the Fiscal and Paying Agency Agreement,  this Agreement and
      any applicable Purchase Agreement and the consummation of the transactions
      herein and therein  contemplated  will not conflict  with or result in the
      creation or imposition of any lien, charge, or encumbrance upon any of the
      assets  of the  Corporation,  the  Bank or  their  respective  significant
      subsidiaries  pursuant to the terms of, or constitute a default under, any
      indenture,  mortgage,  deed of trust, loan agreement or other agreement or
      instrument  known to such counsel to which the  Corporation or the Bank or
      any of their  respective  significant  subsidiaries is a party or by which
      the  Corporation  or  the  Bank  or any of  their  respective  significant
      subsidiaries  is bound or to which  any of the  property  or assets of the
      Corporation   or  the  Bank  or  any  of  their   respective   significant
      subsidiaries is subject,  nor will any such action result in any violation
      of the  charter or the  by-laws of the  Corporation  or the Bank or any of
      their respective significant subsidiaries or any applicable law or statute
      or any order, rule or regulation of any court or any state or federal bank
      regulatory or other governmental  agency or body having  jurisdiction over
      the Corporation or the Bank, their respective significant  subsidiaries or
      any of their  respective  properties,  except for  violations  or defaults
      which individually or in the aggregate are not material to the Corporation
      or the Bank, as the case may be, and its significant subsidiaries taken as
      a whole;

         (viii) No consent, approval, authorization, order, filing, registration
      or  qualification  of or with any  court  or any  state  or  federal  bank
      regulatory or other governmental  agency or body is required for the issue
      and  sale of the  Notes  by the  Bank  or the  consummation  of the  other
      transactions  contemplated  by this  Agreement,  any  applicable  Purchase
      Agreement or the Fiscal and Paying Agency Agreement, except such consents,
      approvals, authorizations, filings, registrations or qualifications as may
      be required under state  securities or Blue Sky laws or the regulations of
      the Office of the  Comptroller  of the Currency,  in  connection  with the
      offers and sales of the Notes by the Bank;

           (ix) The statements  made in the Offering  Circular under the caption
      "Description  of the Bank Notes,"  insofar as they purport to constitute a
      summary of the terms of documents referred to therein, constitute accurate
      summaries of the terms of such documents  (subject to the insertion in the
      Notes of the  maturity  dates,  interest  rates  and other  similar  terms
      thereof);

           (x) Other than as set forth in the Offering Circular,  to the best of
      such counsel's knowledge,  there are no legal or governmental  proceedings
      pending or  threatened or  contemplated  to which the  Corporation  or the
      Bank, or any of their respective significant subsidiaries,  is or may be a
      party or to which any property of the  Corporation  or the Bank, or any of
      their respective significant subsidiaries,  is or may be the subject which
      could  individually  or in the aggregate  reasonably be expected to have a
      material  adverse  effect on the  general  affairs,  business,  prospects,
      management,  consolidated  financial  position,  stockholders'  equity  or
      results of operations of the Corporation or the Bank and its  subsidiaries
      taken as a whole;

           (xi) No facts have come to such counsel's  attention which lead it to
      believe that the Offering  Circular as of its date,  as of the  settlement
      date with  respect to the sale of any Notes sold to the Agent as principal
      pursuant to Section  3(e) hereof and as of any date an opinion is required
      to be delivered by such counsel pursuant to Section 7(c) hereof,  contains
      an untrue  statement of a material  fact or omits to state a material fact
      required to be stated therein or necessary to make the statements therein,
      in the  light  of the  circumstances  under  which  they  were  made,  not
      misleading  (except  that such  counsel need not express any opinion as to
      the financial  statements  or schedules  and other  financial or operating
      data included or incorporated by reference  therein);  the descriptions in
      the Offering  Circular of statutes,  regulations,  legal and  governmental
      proceedings and other documents which pertain to the Bank, the Corporation
      or the  Notes  are  accurate  in  all  respects  and  fairly  present  the
      information required to be shown;

      (xii) To the best of such counsel's knowledge, no investigation,  no order
      directed  to any  document  incorporated  by  reference  in  the  Offering
      Circular has been issued and no challenge has been made to the accuracy or
      adequacy of any such document;

         (xiii) The Notes are exempt  securities  under  Section  3(a)(2) of the
      Securities Act, and neither registration of the Notes under the Securities
      Act nor  qualification  of an indenture  under the Trust  Indenture Act is
      required in connection with the offer, sale,  issuance or delivery of such
      Notes as contemplated by this Agreement; and

         (xiv) The Bank is an insured bank under the  applicable  provisions  of
      the Federal Deposit Insurance Act, as amended.

                 Such   counsel  may  state  that  the  opinions  set  forth  in
paragraphs  (iii)  and (v) above  are  subject  to the  effects  of  bankruptcy,
insolvency, fraudulent conveyance, reorganization,  moratorium and other laws of
general applicability relating to or affecting the rights of creditors generally
or of creditors of depository  institutions the accounts of which are insured by
FDIC and by general equitable  principles (whether considered in a proceeding in
equity or at law).  Such counsel may rely on the opinion of counsel to the Agent
as to matters of New York law.

      (e) The Bank and the Corporation shall each have furnished to the Agent on
the Closing Date a certificate,  dated the Closing Date, of its Chief  Executive
Officer or Executive Vice President and its Chief Financial  Officer,  Treasurer
or Assistant Treasurer stating that:

            (i) The  representations,  warranties and agreements of the Bank and
      of the  Corporation  in  Sections 1 and 2 hereof,  as the case may be, are
      true and correct as of the Closing  Date;  the Bank has complied  with all
      its agreements  contained herein;  and the conditions set forth in Section
      6(a) hereof have been fulfilled; and

           (ii) They have carefully examined the Offering Circular and, in their
      opinion,  the Offering Circular does not contain any untrue statement of a
      material fact or omit to state a material fact  necessary in order to make
      the statements therein, in the light of the circumstances under which they
      were made, not misleading.

           (f) The Agent shall have  received  from Simpson  Thacher & Bartlett,
counsel to the Agent,  such opinion or opinions,  dated the Closing  Date,  with
respect  to the  issuance  and sale of the Notes,  the Fiscal and Paying  Agency
Agreement,  the  Offering  Circular and other  related  matters as the Agent may
reasonably  require,  and the  Corporation  and the Bank shall have furnished to
such counsel such documents as they may request for the purpose of enabling them
to pass upon such matters.

      (g) No order  shall  have been  issued  by any  federal  or state  bank or
securities  regulatory  authority  in respect of the  Offering  Circular  or the
offering of Notes contemplated  thereby which would interfere with such offering
of the Notes and no proceedings  for that purpose shall have been  instituted or
threatened  or to  the  knowledge  of  the  Corporation  or the  Bank  shall  be
contemplated by any such authority.

      (h) There shall not have  occurred:  (i) any adverse change or development
involving a prospective adverse change in the capital stock or long-term debt of
the  Corporation  or  any  of  its  subsidiaries  or  the  Bank  or  any  of its
subsidiaries or in the condition,  financial or otherwise, of the Corporation or
any of  its  subsidiaries  or of the  Bank  or  any of its  subsidiaries  or the
earnings,  affairs,  or  business  prospects  of the  Corporation  or any of its
subsidiaries or of the Bank or any of its  subsidiaries,  whether or not arising
in the ordinary  course of business,  which would,  in the opinion of the Agent,
materially  impair  the  investment  quality  of  the  Bank's  Notes;  (ii)  any
downgrading,  or any notice given of any intended or potential downgrading or of
any review for a possible  change that does not  indicate  the  direction of the
possible change,  in the rating accorded any of the  Corporation's or any of the
Bank's   securities   by   any   "nationally   recognized   statistical   rating
organization",  as such term is defined for purposes of Rule 436(g)(2) under the
Securities Act; (iii) any liability or obligation,  direct or contingent,  which
is material to the Corporation  and its  subsidiaries,  taken as a whole,  other
than those reflected in the Offering  Circular;  (iv) any outbreak or escalation
of hostilities or other national or  international  calamity or crisis or change
in  economic  conditions  or in the  financial  markets of the United  States or
elsewhere that, in the judgment of the Agent, is material and adverse and would,
in the judgment of the Agent,  make it  impracticable to market the Notes on the
terms  and  in the  manner  contemplated  in  the  Offering  Circular;  (v)  the
suspension or material limitation of trading in any securities of the Company on
any exchange or the over-the-counter  ("OTC") market or limitation on prices for
any  securities  on  any  exchange  or  the  OTC  market;  (vi)  the  enactment,
publication,  decree or other  promulgation  of any  federal  or state  statute,
regulation,  rule or order of any court or other governmental authority which in
the opinion of the Agent  materially and adversely  affects,  or will materially
and adversely  affect,  the business or operations of the  Corporation or any of
its  subsidiaries;  (vii)  the  declaration  of a banking  moratorium  by either
federal or New York State  authorities or (viii) the taking of any action by any
federal,  state or local  government  or agency in  respect of its  monetary  or
fiscal  affairs which in the opinion of the Agent has a material  adverse effect
on the financial markets in the United States.

            For  purposes  of this  section  6(h),  it is  understood  that with
respect to any person who has agreed to  purchase  Notes as a result of an offer
to purchase  solicited by the Agent the judgment or opinion of such person shall
be substituted  for the respective  judgments or opinions  referred to herein of
the Agent,  and that the Agent shall have no duty or  obligation  whatsoever  to
exercise such judgment or opinion on behalf of any such person.

      (i) Prior to the Closing  Date,  the  Corporation  and the Bank shall have
furnished to the Agent such further  information,  certificates and documents as
the Agent or counsel to the Agent may reasonably request.

            All opinions,  letters, evidence and certificates mentioned above or
elsewhere  in this  Agreement  shall  be  deemed  to be in  compliance  with the
provisions  hereof only if they are in the form and  substance  satisfactory  to
counsel for the Agent.

      SECTION 7 . ADDITIONAL  COVENANTS OF THE CORPORATION AND THE BANK. Each of
            the Corporation and the Bank covenants and agrees that:

      (a) Each  acceptance  by the Bank of an offer  for the  purchase  of Notes
shall be deemed to be an affirmation that the  representations and warranties of
the  Corporation and the Bank contained in this Agreement and in any certificate
theretofore  given to the Agent pursuant hereto are true and correct at the time
of such acceptance,  and an undertaking that such representations and warranties
will be true and correct at the time of delivery to the  purchaser  or his agent
of the Notes  relating to such  acceptance as though made at and as of each such
time (and such  representations  and  warranties  shall  relate to the  Offering
Circular as amended or supplemented to each such time).

      (b) During each period  preceding  the date, if any, on which the Bank has
advised the Agent to suspend  solicitations of offers to purchase Notes pursuant
to  Section  3(b) or after  which  the  Bank  has  advised  the  Agent  that the
solicitation of offers to purchase Notes which was suspended may be resumed (the
"Marketing  Period"),  each time that the Offering  Circular shall be amended or
supplemented  (other  than by a  Pricing  Supplement  providing  solely  for the
interest  rates or  maturities  of the  Notes or the  principal  amount of Notes
remaining to be sold or similar changes and other than as a result of the filing
with the FDIC of an Incorporated  Document by the Bank or other than as a result
of the filing of a Current Report on Form 8-K by the Corporation  solely for the
purpose of filing with the  Commission a press release with respect to quarterly
or annual  earnings) or each time the Bank sells Notes to the Agent as principal
and the  applicable  Purchase  Agreement  specifies the delivery of an officers'
certificate  under this  Section  7(b) as a condition  to the  purchase of Notes
pursuant to such Purchase  Agreement,  the Bank and the Corporation shall submit
to the Agent certificates, (i) as of the date of such amendment or supplement or
as of the  Time  of  Delivery  relating  to such  sale or (ii) if such  Offering
Circular was not amended or supplemented  during a Marketing  Period,  as of the
first  day of the  next  succeeding  Marketing  Period,  representing  that  the
statements  contained  in the  certificates  referred to in Section  6(e) hereof
which were last  furnished to the Agent are true and correct at the time of such
amendment or supplement, Time of Delivery or first day of such Marketing Period,
as the case may be, as  though  made at and as of such  time  (except  that such
statements  shall be deemed to relate to the  Offering  Circular  as amended and
supplemented to such time).

      (c) During each  Marketing  Period,  each time that the Offering  Circular
shall be amended or supplemented  (other than by a Pricing Supplement  providing
solely for the interest rates or maturities of the Notes or the principal amount
of Notes  remaining to be sold or similar  changes and other than as a result of
the filing with the FDIC of an  Incorporated  Document by the Bank or other than
as a result of the  filing of a  Current  Report on Form 8-K by the  Corporation
solely for the  purpose  of filing  with the  Commission  a press  release  with
respect to  quarterly  or annual  earnings) or each time the Bank sells Notes to
the Agent as principal  and the  applicable  Purchase  Agreement  specifies  the
delivery  of a legal  opinion  under this  Section  7(c) as a  condition  to the
purchase  of Notes  pursuant to such  Purchase  Agreement,  the Bank shall,  (i)
concurrently  with such  amendment,  supplement or Time of Delivery  relating to
such sale or (ii) if such  Offering  Circular  was not  amended or  supplemented
during a Marketing  Period,  on the first day of the next  succeeding  Marketing
Period,  furnish  the Agent and its counsel  with the  written  opinion of Wyatt
Tarrant & Combs, counsel to the Bank, or of such other counsel acceptable to the
Agent, addressed to the Agent and dated the date of delivery of such opinion, in
form satisfactory to the Agent, of the same effect as the opinion referred to in
Section  6(d)  hereof but  modified,  as  necessary,  to relate to the  Offering
Circular as amended or  supplemented  to the time of  delivery of such  opinion;
provided,  however,  that in lieu of such opinion,  such counsel may furnish the
Agent  with a letter to the  effect  that the  Agent may rely on such  counsel's
prior  opinion to the same extent as though it was dated the date of such letter
authorizing  reliance  (except that  statements  in such prior  opinion shall be
deemed to relate to the Offering Circular as amended or supplemented to the time
of delivery of such letter authorizing reliance).

      (d) On any  settlement  date for the sale of  Notes,  the Bank  shall,  if
requested  by the  Agent,  furnish  the Agent  with a written  opinion  of Wyatt
Tarrant & Combs, counsel to the Bank, or of such other counsel acceptable to the
Agent,  dated such  settlement  date, in form  satisfactory to the Agent, to the
effect set forth in Section 6(d) hereof, but modified,  as necessary,  to relate
to the  Offering  Circular  relating  to  the  Notes  to be  delivered  on  such
settlement date; provided,  however,  that in lieu of such opinion, such counsel
may  furnish  the Agent with a letter to the  effect  that the Agent may rely on
such  counsel's  prior  opinion  to the same  extent as though it was dated such
settlement date (except that statements in such prior opinion shall be deemed to
relate to the  Offering  Circular  as  amended  or  supplemented  to the time of
delivery of such letter authorizing reliance).

      SECTION 8  .  INDEMNIFICATION AND CONTRIBUTION BY THE BANK.
      (a) The Bank  agrees to  indemnify  and hold  harmless  the Agent and each
person,  if any,  who controls the Agent within the meaning of Section 15 of the
Securities  Act or Section 20 of the Exchange  Act, from and against any and all
losses, claims, damages,  liabilities and judgments arising out of or related to
any untrue statement or alleged untrue statement of a material fact contained in
any  Offering  Circular  (as  amended  or  supplemented  if the Bank  shall have
furnished any amendments or supplements  thereto),  or arising out of or related
to any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements  therein,  in the light of
the circumstances under which they were made, not misleading,  except insofar as
such losses,  claims,  damages,  liabilities or judgments are caused by any such
untrue  statement or omission or alleged untrue statement or omission based upon
information  relating  to the Agent  furnished  in  writing to the Bank by or on
behalf of the Agent expressly for use therein.

      (b) In case any action  shall be brought  against  the Agent or any person
controlling  the Agent,  based upon the  Offering  Circular or any  amendment or
supplement thereto and with respect to which indemnity may be sought against the
Bank,  the Agent  shall  promptly  notify the Bank in writing and the Bank shall
assume the defense  thereof,  including  the  employment  of counsel  reasonably
satisfactory to such indemnified party and payment of all fees and expenses. The
Agent or any such  controlling  person  shall have the right to employ  separate
counsel in any such action and participate in the defense thereof,  but the fees
and  expenses  of such  counsel  shall be at the  expense  of the  Agent or such
controlling  person  unless (i) the  employment  of such counsel shall have been
specifically  authorized in writing by the Bank, (ii) the Bank shall have failed
to assume the defense and employ  counsel or (iii) the named parties to any such
action  (including  any  impleaded  parties)  include  both  the  Agent  or such
controlling  person and the Bank and the Agent or such controlling  person shall
have been advised by such  counsel that there may be one or more legal  defenses
available to it which are different from or additional to those available to the
Bank (in which case the Bank  shall not have the right to assume the  defense of
such  action  on  behalf  of the  Agent  or such  controlling  person,  it being
understood,  however,  that the Bank shall not, in connection  with any one such
action or  separate  but  substantially  similar or related  actions in the same
jurisdiction  arising out of the same general  allegations or circumstances,  be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for the Agent and controlling persons, which firm
shall be  designated in writing by the Agent and that all such fees and expenses
shall be reimbursed as they are incurred).  The Bank shall not be liable for any
settlement  of any such  action  effected  without  its  written  consent but if
settled with the written  consent of the Bank,  the Bank agrees to indemnify and
hold  harmless  the Agent and any such  controlling  person from and against any
loss or liability by reason of such settlement.  Notwithstanding the immediately
preceding sentence, if in any case where the fees and expenses of counsel are at
the  expense  of the  indemnifying  party and an  indemnified  party  shall have
requested the  indemnifying  party to reimburse the  indemnified  party for such
fees and expenses of counsel as incurred, such indemnifying party agrees that it
shall be liable for any  settlement of any action  effected  without its written
consent if (i) such settlement is entered into more than ten business days after
the receipt by such  indemnifying  party of the aforesaid  request and (ii) such
indemnifying  party  shall have failed to  reimburse  the  indemnified  party in
accordance  with  such  request  for  reimbursement  prior  to the  date of such
settlement.  No indemnifying  party shall,  without the prior written consent of
the  indemnified  party,  effect any  settlement  of any  pending or  threatened
proceeding  in  respect of which any  indemnified  party is or could have been a
party and indemnity could have been sought hereunder by such indemnified  party,
unless such settlement  includes an  unconditional  release of such  indemnified
party  from  all  liability  on  claims  that  are the  subject  matter  of such
proceeding.

      (c) The  Agent  agrees to  indemnify  and hold  harmless  the Bank and any
person  controlling  the Bank within the meaning of Section 15 of the Securities
Act or Section  20 of the  Exchange  Act,  to the same  extent as the  foregoing
indemnity  from the Bank to the  Agent but only with  reference  to  information
relating  to the Agent  furnished  in writing to the Bank by or on behalf of the
Agent  expressly for use in the Offering  Circular.  In case any action shall be
brought  against the Bank,  any of its directors or any person  controlling  the
Bank based on the  Offering  Circular and in respect of which  indemnity  may be
sought  against the Agent,  the Agent shall have the rights and duties  given to
the Bank (except that if the Bank shall have  assumed the defense  thereof,  the
Agent shall not be required to do so, but may employ  separate  counsel  therein
and participate in the defense thereof but the fees and expenses of such counsel
shall be at the expense of the Agent),  and the Bank and any person  controlling
the Bank shall have the rights and duties  given to the Agent,  by Section  8(b)
hereof.

      (d) If the  indemnification  provided for in this Section 8 is unavailable
to an indemnified party in respect of any losses, claims,  damages,  liabilities
or  judgments  referred to therein,  then each  indemnifying  party,  in lieu of
indemnifying  such  indemnified  party,  shall  contribute to the amount paid or
payable by such indemnified party as a result of such losses,  claims,  damages,
liabilities  and judgments (i) in such  proportion as is  appropriate to reflect
the relative  benefits received by the Bank on the one hand and the Agent on the
other  hand from the  offering  of the  Bank's  Notes or (ii) if the  allocation
provided  by clause  (i)  above is not  permitted  by  applicable  law,  in such
proportion as is appropriate to reflect not only the relative  benefits referred
to in clause (i) above but also the relative  fault of the Bank and the Agent in
connection  with the  statements  or  omissions  which  resulted in such losses,
claims,  damages,  liabilities  or  judgments,  as  well as any  other  relevant
equitable  considerations.  The relative  benefits  received by the Bank and the
Agent  shall be deemed to be in the same  proportion  as the total net  proceeds
from the offering of the Bank's Notes (before  deducting  expenses)  received by
the Bank, and the total underwriting  discounts and commissions  received by the
Agent from the  offering  of the Bank's  Notes,  bear to the total  price to the
public of the Bank's Notes.  The relative  fault of the Bank and the Agent shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Bank or the Agent and the
parties'  relative intent,  knowledge,  access to information and opportunity to
correct or prevent such statement or omission.

           SECTION 9    .  INDEMNIFICATION AND CONTRIBUTION BY THE CORPORATION.
      (a) The  Corporation  agrees to indemnify  and hold harmless the Agent and
each person,  if any, who controls the Agent within the meaning of Section 15 of
the  Securities  Act or Section 20 of the Exchange Act, from and against any and
all  losses,  claims,  damages,  liabilities  and  judgments  arising  out of or
relating to any untrue  statement or alleged untrue statement of a material fact
contained  in  the  Offering   Circular  (as  amended  or  supplemented  if  the
Corporation  shall have  furnished any amendments or  supplements  thereto),  or
arising out of or related to any omission or alleged omission to state therein a
material fact required to be stated  therein or necessary to make the statements
therein  not  misleading,  except  insofar  as  such  losses,  claims,  damages,
liabilities or judgments are caused by any such untrue  statement or omission or
alleged  untrue  statement or omission  based upon  information  relating to the
Agent  furnished  in writing to the Bank by or on behalf of the Agent  expressly
for use therein.

      (b) In case any action  shall be brought  against  the Agent or any person
controlling  the Agent,  based upon any  Offering  Circular or any  amendment or
supplement thereto and with respect to which indemnity may be sought against the
Corporation,  the Agent shall promptly notify the Corporation in writing and the
Corporation  shall  assume the defense  thereof,  including  the  employment  of
counsel  reasonably  satisfactory to such  indemnified  party and payment of all
fees and expenses. The Agent or any such controlling person shall have the right
to employ  separate  counsel in any such action and  participate  in the defense
thereof,  but the fees and expenses of such  counsel  shall be at the expense of
the Agent or such  controlling  person unless (i) the employment of such counsel
shall have been specifically authorized in writing by the Corporation,  (ii) the
Corporation  shall have failed to assume the defense and employ counsel or (iii)
the named parties to any such action  (including any impleaded  parties) include
both the Agent or such  controlling  person and the Corporation and the Agent or
such  controlling  person shall have been advised by such counsel that there may
be one or more  legal  defenses  available  to it which  are  different  from or
additional to those  available to the Corporation (in which case the Corporation
shall not have the right to assume the  defense of such  action on behalf of the
Agent  or such  controlling  person,  it  being  understood,  however,  that the
Corporation  shall not, in  connection  with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same  general  allegations  or  circumstances,  be  liable  for the fees and
expenses of more than one separate  firm of attorneys  (in addition to any local
counsel)  for the  Agent  and any  controlling  persons,  which  firm  shall  be
designated in writing by the Agent, and that all such fees and expenses shall be
reimbursed as they are incurred).  The  Corporation  shall not be liable for any
settlement  of any such  action  effected  without  its  written  consent but if
settled with the written consent of the Corporation,  the Corporation  agrees to
indemnify and hold harmless the Agent and any such  controlling  person from and
against any loss or liability by reason of such settlement.  Notwithstanding the
immediately  preceding  sentence,  if in any case where the fees and expenses of
counsel are at the expense of the  indemnifying  party and an indemnified  party
shall have requested the indemnifying  party to reimburse the indemnified  party
for such fees and  expenses  of counsel as  incurred,  such  indemnifying  party
agrees that it shall be liable for any settlement of any action effected without
its  written  consent  if (i) such  settlement  is  entered  into  more than ten
business  days after the  receipt by such  indemnifying  party of the  aforesaid
request and (ii) such  indemnifying  party shall have  failed to  reimburse  the
indemnified party in accordance with such request for reimbursement prior to the
date of such settlement.  No indemnifying party shall, without the prior written
consent of the  indemnified  party,  effect  any  settlement  of any  pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought  hereunder by such indemnified
party,  unless  such  settlement  includes  an  unconditional  release  of  such
indemnified  party from all  liability on claims that are the subject  matter of
such proceeding.

      (c) The Agent agrees to indemnify  and hold harmless the  Corporation  and
any person  controlling the Corporation  within the meaning of Section 15 of the
Securities  Act or Section 20 of the  Exchange  Act,  to the same  extent as the
foregoing indemnity from the Corporation to the Agent but only with reference to
information  relating to the Agent  furnished in writing by or on behalf of such
Agent through you expressly for use in any Offering Circular. In case any action
shall  be  brought  against  the  Corporation  or  any  person  controlling  the
Corporation based on the Offering Circular and in respect of which indemnity may
be sought against the Agent, the Agent shall have the rights and duties given to
the Corporation  (except that if the Corporation  shall have assumed the defense
thereof,  the Agent  shall not be  required  to do so, but may  employ  separate
counsel therein and participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of the Agent),  and the  Corporation and
any person controlling the Corporation shall have the rights and duties given to
the Agent, by Section 9(b) hereof.

      (d) If the  indemnification  provided for in this Section 9 is unavailable
to an indemnified party in respect of any losses, claims,  damages,  liabilities
or  judgments  referred to therein,  then each  indemnifying  party,  in lieu of
indemnifying  such  indemnified  party,  shall  contribute to the amount paid or
payable by such indemnified party as a result of such losses,  claims,  damages,
liabilities  and judgments (i) in such  proportion as is  appropriate to reflect
the relative  benefits received by the Corporation on the one hand and the Agent
on the  other  hand  from  the  offering  of  Notes  by the  Bank or (ii) if the
allocation  provided by clause (i) above is not permitted by applicable  law, in
such  proportion  as is  appropriate  to reflect not only the relative  benefits
referred to in clause (i) above but also the relative  fault of the  Corporation
and the Agent in connection  with the statements or omissions  which resulted in
such losses,  claims,  damages,  liabilities or judgments,  as well as any other
relevant  equitable  considerations.  The  relative  benefits  received  by  the
Corporation  and the Agent shall be deemed to be in the same  proportion  as the
total net  proceeds  from the  offering  of Notes  (before  deducting  expenses)
received  by the Bank,  and the total  underwriting  discounts  and  commissions
received by the Agent, bear to the total price to the public of the Notes issued
by the Bank.  The  relative  fault of the  Corporation  and the  Agent  shall be
determined by reference  to, among other  things,  whether the untrue or alleged
untrue  statement of a material  fact or the  omission to state a material  fact
relates to information supplied by the Corporation or the Agent and the parties'
relative intent, knowledge,  access to information and opportunity to correct or
prevent such statement or omission.

                 The  Corporation  and the Agent agree that it would not be just
and equitable if  contribution  pursuant to this Section 9(d) were determined by
pro rata  allocation  or by any other method of  allocation  which does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding  paragraph shall be deemed to include,  subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection  with  investigating  or defending any such action or claim.
Notwithstanding  the  provisions  of this  Section  9, the  Agent  shall  not be
required  to  contribute  any  amount in excess of the amount by which the total
price at which the Notes purchased by or sold through such Agent and distributed
to the public were offered to the public exceeds the amount of any damages which
such  Agent has  otherwise  been  required  to pay by  reason of such  untrue or
alleged untrue  statement or omission or alleged  omission.  No person guilty of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) shall be entitled to  contribution  from any person who was not
guilty of such fraudulent misrepresentation.

      SECTION 10 .  STATUS OF THE AGENT.
            In  soliciting  offers to purchase  Notes from the Bank  pursuant to
this Agreement (other than in respect of any Purchase  Agreement),  the Agent is
acting  solely as agent for the Bank and not as  principal.  The Agent will make
reasonable efforts to assist the Bank in obtaining performance by each purchaser
whose offer to purchase  Notes from the Bank has been solicited by the Agent and
accepted  by the Bank but the Agent shall have no  liability  to the Bank in the
event any such  purchase is not  consummated  for any reason.  If the Bank shall
default in its  obligations  to deliver Notes to a purchaser  whose offer it has
accepted,  the Bank shall (i) hold the Agent harmless against any loss, claim or
damage  arising  from or as a result of such default by the Bank and (ii) pay to
the Agent any  commission to which it would be entitled in connection  with such
sale.

      SECTION 11  REPRESENTATIONS, WARRANTIES AND OBLIGATIONS TO SURVIVE
                  DELIVERY.
            The respective indemnities, agreements, representations,  warranties
and other  statements of the  Corporation,  the Bank and the Agent  contained in
this Agreement, or made by or on behalf of them, respectively,  pursuant to this
Agreement,  shall remain  operative and in full force and effect,  regardless of
any  investigation  made by or on behalf of the Agent or any person  controlling
such Agent or by or on behalf of the  Corporation or the Bank, and shall survive
each delivery of and payment for any of the Notes.

      SECTION 12 .  TERMINATION.
            This  Agreement may be terminated for any reason with respect to any
party  hereto,  at any time,  by any party hereto upon the giving of sixty day's
written  notice of such  termination  to the  other  parties  hereto;  provided,
however,  that such  termination  shall be  effective  only with respect to such
terminating party. If, at the time of a termination, an offer to purchase any of
the  Notes  has  been  accepted  by the Bank  but the  time of  delivery  to the
purchaser has not occurred,  the  provisions of this  Agreement  shall remain in
effect with respect to the Agent,  the Corporation and the Bank until such Notes
are delivered.  The provisions of Sections 3(c), 5, 8, 9, 10 and 11 hereof shall
survive any termination of this Agreement.

      SECTION 13 .  NOTICES.
            Except as  otherwise  provided  herein,  all notices  and other 
communications  hereunder  shall be in writing  and  shall  be  deemed  to have
been  duly  given  if  mailed  or  transmitted  by any  standard  form of
telecommunication.  Notices  to the  Agent  shall be  directed  to it as 
follows:  Donaldson,  Lufkin  &  Jenrette Securities Corporation,
140 Broadway,  New York,  New York 10005, Attention:  Roger Thomson,
Telephone No.: (212)504-3192,  Facsimile No.:  (212)  504-8244; 
notices to the Bank shall be directed to it as follows:  500 East Main
Street,  Bowling Green,  Kentucky 42101  Attention:  Edward R. Matthews; 
Telephone No.: (502) 793-7717;  Facsimile No.: (502) 793-7753.

      SECTION 14 .  BINDING EFFECT; BENEFITS.
            This Agreement shall be binding upon the Agent, the Corporation, the
Bank  and  their  respective  successors.  This  Agreement  and  the  terms  and
provisions  hereof are for the sole benefit of only those  persons,  except that
(a)  the  representations,   warranties,   indemnities  and  agreements  of  the
Corporation  and the Bank contained in this Agreement shall also be deemed to be
for the benefit of the person or persons,  if any,  who control the Agent within
the meaning of Section 15 of the Securities Act, and (b) the indemnity agreement
of the Agent  contained  in Section 8 and Section 9 hereof shall be deemed to be
for the benefit of any person  controlling the Corporation and the Bank. Nothing
in this  Agreement is intended or shall be  construed to give any person,  other
than the person  referred  to in this  Section,  any legal or  equitable  right,
remedy or claim under or in respect of this Agreement or any provision contained
herein.

      SECTION 15 .  GOVERNING LAW; COUNTERPARTS.
            This Agreement shall be governed by and construed in accordance with
the  laws  of  the  State  of New  York.  This  Agreement  may  be  executed  in
counterparts and the executed  counterparts  shall together  constitute a single
instrument.

      SECTION 16 .  PARAGRAPH HEADINGS.
      The paragraph  headings  used in this  Agreement  are for  convenience  of
reference only, and are not to affect the  construction  hereof or be taken into
consideration in the interpretation hereof.



<PAGE>


           If the foregoing correctly sets forth our agreement,  please indicate
your acceptance hereof in the space provided for that purpose below.

                                      Very truly yours,

                                      TRANS FINANCIAL BANK, NATIONAL ASSOCIATION



                                            By:
                                                      Title:

                                            TRANS FINANCIAL, INC.



                                            By:
                                                      Title:


CONFIRMED AND ACCEPTED, as of the date first above written:

DONALDSON, LUFKIN & JENRETTE
 SECURITIES CORPORATION



By:
                Authorized Signatory




<PAGE>


===============================================================================
                                                                         B-58
===============================================================================











                                                        


                                            EXHIBIT A

                   TRANS FINANCIAL BANK, NATIONAL ASSOCIATION

                                Senior Bank Notes
                              SCHEDULE OF PAYMENTS
      The Bank agrees to pay the Agent a commission  not to exceed the following
percentage of the aggregate U.S.  dollar  equivalent of the principal  amount of
the Senior Bank Notes issued by the Bank:


=============================================  =============================
                  TERM                               COMMISSION RATE
=============================================  =============================
30 days to less than 6 months                             .075%
=============================================  =============================
6 months to less than 9 months                            .100%
=============================================  =============================
9 months to less than 12 months                           .125%
=============================================  =============================
12 months to less than 18 months                          .150%
=============================================  =============================
18 months to less than 2 years                            .200%
=============================================  =============================
2 years to less than 3 years                              .250%
=============================================  =============================
3 years to less than 4 years                              .350%
=============================================  =============================
4 years to less than 5 years                              .450%
=============================================  =============================
5 years to less than 6 years                              .500%
=============================================  =============================
6 years to less than 7 years                              .550%
=============================================  =============================
7 years to less than 10 years                             .625%
=============================================  =============================
10 years to less than 12 years                            .650%
=============================================  =============================
12 years to less than 15 years                            .675%
=============================================  =============================
15 years to less than 20 years                            .750%
=============================================  =============================
20 years or more                                          .875%
=============================================  =============================



<PAGE>


===============================================================================
                                    EXHIBIT B
===============================================================================

                            ADMINISTRATIVE PROCEDURES

                   TRANS FINANCIAL BANK, NATIONAL ASSOCIATION




      Bank Notes (the "Notes") are to be offered on a continuing  basis by Trans
Financial Bank, National Association (the "Issuing Bank").  Donaldson,  Lufkin &
Jenrette  Securities  Corporation as agent (the "Agent"),  has agreed to use its
reasonable  best efforts to solicit offers to purchase the Notes.  The Notes are
being sold pursuant to a Distribution Agreement among the Bank, Trans Financial,
Inc.  and the Agent  dated  September  28,  1995 (as it may be  supplemented  or
amended  from  time to  time,  the  "Distribution  Agreement")  to  which  these
administrative  procedures are attached as an exhibit.  The Notes will be issued
under a Fiscal and Paying  Agency  Agreement,  dated as of  September  28,  1995
between the Bank and First Fidelity Bank,  N.A., as fiscal and paying agent (the
"Fiscal  and  Paying  Agent").  The Notes may be issued as either  "Senior  Bank
Notes",  which will rank equally  with all other  unsecured  and  unsubordinated
indebtedness (other than deposits, to the extent provided by federal law and any
applicable state law) of the Bank, or "Subordinated  Bank Notes",  which will be
subordinated  to all  present  and  future  claims  of  depositors  and  general
creditors  of the Bank.  Senior Bank Notes will have  maturities  of from thirty
days to thirty years from the date of issue;  Subordinated  Bank Notes will have
maturities  of from five  years to thirty  years  from the date of issue.  Terms
defined in the Offering Circular relating to the Notes (the "Offering Circular")
and in the Distribution  Agreement shall have the same meaning when used in this
exhibit.

      The Notes will be issued in  book-entry  form (each a  "Book-Entry  Note")
represented  by one or more  fully  registered  global  Notes  (each  a  "Global
Security")  delivered  to the Fiscal  and Paying  Agent,  as  custodian  for The
Depository Trust Company as depositary or its nominee or a successor  depositary
or its  nominee  (the  "Depositary"),  and  recorded  in the  book-entry  system
maintained by the Depositary. Owners of beneficial interests in Book-Entry Notes
will be  entitled to physical  delivery  of Notes in  certificated  form (each a
"Certificated  Note") equal in principal amount to their  respective  beneficial
interests  only upon  certain  limited  circumstances  described in the Offering
Circular.

      Administrative  responsibilities,   document  control  and  record-keeping
functions to be performed by the Bank will be performed by the Fiscal and Paying
Agent. Administrative procedures for the offering are explained below.

      PRICE TO PUBLIC
      Each Note will be issued at 100% of its principal amount, unless otherwise
determined by the Bank.

      DATE OF ISSUANCE
      Each Note will be dated and issued as of the date of its authentication by
the Fiscal and Paying Agent.

      MATURITIES
      Each Note will mature on a Business Day (as defined below) selected by the
purchaser and agreed upon by the Bank,  such date being at least thirty days but
not more than thirty years from the date of issuance, in the case of Senior Bank
Notes, and from five years to thirty years from the date of issuance in the case
of Subordinated  Bank Notes.  Each Floating Rate Note will mature on an Interest
Payment Date (as defined below).

      "Business  Day" shall  mean any day which is not a Saturday  or Sunday and
which is not a day on which banking  institutions  are  generally  authorized or
obligated  by law to  close in the  City of New  York,  New York and the City of
Bowling Green, Kentucky (or, with respect to LIBOR Notes, the City of London).

      REGISTRATION
      Notes will be issued only in fully  registered form either as a Book-Entry
Note or a Certificated Note.

      INTEREST PAYMENTS
      Each Note bearing interest at a fixed rate (a "Fixed Rate Note") will bear
interest  from its issue date at the  annual  rate  stated on the face  thereof,
payable on March 15 and  September  15 of each year (each an  "Interest  Payment
Date" with  respect to such  Fixed  Rate  Note) and at Stated  Maturity  or upon
redemption, if applicable.

      Special  provisions  are set forth in the  Offering  Circular  relating to
Notes bearing interest at a rate or rates determined by reference to an interest
rate formula  ("Floating  Rate Notes")  stated on the face  thereof,  payable in
arrears on such dates as are specified  therein (each an "Interest Payment Date"
with respect to such Floating Rate Note).

      Interest on Fixed Rate Notes will be calculated and paid on the basis of a
360-day year of twelve 30-day months.  Interest will be payable to the person in
whose name a Note is  registered  at the close of business on the  fifteenth day
(whether or not a Business  Day) next  preceding  an Interest  Payment Date with
respect to such Note (the  "Record  Date");  provided,  however,  that  interest
payable at Stated Maturity will be payable to the person to whom principal shall
be payable.  Any payment of principal  and interest on such Note  required to be
paid on an Interest  Payment Date or at Stated Maturity or upon  redemption,  if
applicable, which is not a Business Day shall be postponed to the next day which
is a Business Day. The first payment of interest on any Note  originally  issued
between a Record Date and an Interest  Payment Date will be made on the Interest
Payment Date  following  the next  succeeding  Record Date.  Except as set forth
under  "Procedures  for  Book-Entry  Notes," all  interest  payments,  excluding
interest  payments made at Stated  Maturity or upon  redemption,  if applicable,
will be made by check mailed to the person  entitled  thereto as provided above,
or, at the option of the Bank, by wire transfer to an account maintained by such
person with a bank located in the United States.  Notwithstanding the foregoing,
the holder of $1 million or more in aggregate principal amount of Notes with the
same Interest Payment Date may receive payment by wire transfer by delivering to
the Fiscal and Paying Agent in writing on or prior to the applicable Record Date
its request for payment by wire transfer,  providing the Fiscal and Paying Agent
with the  appropriate  wire transfer  information  and upon  compliance with the
reasonable requirements of the Fiscal and Paying Agent.

      ACCEPTANCE AND REJECTION OF OFFERS
      The Bank shall have the sole right to accept  offers to purchase its Notes
and may reject any such offer in whole or in part.  Each acceptance or rejection
by the Bank of an offer to purchase its Notes shall be  communicated by the Bank
to the Agent and the Agent shall be entitled to rely on any such  acceptance  or
rejection.  The Agent  shall  promptly  communicate  to the  Bank,  orally or in
writing, each reasonable offer to purchase Notes received by it other than those
rejected  by such  Agent.  The Agent  shall  have the right,  in its  discretion
reasonably exercised without advising the Bank, to reject any offers in whole or
in part.

      SETTLEMENT
      The receipt of immediately  available funds in U.S. Dollars by the Bank in
payment for a Note (less the applicable  commission) and the  authentication and
issuance of such Note shall, with respect to such Note, constitute "Settlement."
All offers  accepted by the Bank will be settled from one to five  Business Days
from the date of acceptance by the Bank pursuant to the timetable for Settlement
set forth below unless the Bank and the purchaser agree to Settlement on a later
date;  provided,  however,  that the Bank will so notify  the  Fiscal and Paying
Agent of any such later date on or before the Business Day immediately  prior to
the Settlement date.

      REDEMPTION AND REPAYMENT
      Unless one or more  Redemption  Dates are specified on the Global Security
and applicable  Pricing  Supplement,  the Notes will not be redeemable  prior to
their Stated  Maturity.  If one or more  Redemption  Dates are so specified with
respect to any Note, the Global Security and applicable Pricing Supplement, will
also specify one or more  redemption  prices  (expressed  as a percentage of the
principal amount of such Note)  ("Redemption  Prices") and the redemption period
or periods  ("Redemption  Periods")  during which such  Redemption  Prices shall
apply.  Unless otherwise specified on the Global Security and applicable Pricing
Supplement,  any such Note shall be  redeemable at the option of the Bank at the
specified Redemption Price applicable to the Redemption Period during which such
Note is to be redeemed,  together with interest  accrued to the Redemption Date.
Unless  otherwise  specified  on the  Global  Security  and  applicable  Pricing
Supplement,  the Notes  will not be subject to any  sinking  fund.  The Bank may
redeem any of its Notes that are  redeemable  and remain  outstanding  either in
whole or from time to time in part, upon not less than 30 nor more than 45 days'
notice.  In the event of a  redemption  in part of any Note,  a new Note for the
amount of the unredeemed  portion shall be issued in the name of the Holder upon
cancellation of the redeemed Note.

      The Global Security and applicable  Pricing  Supplement,  relating to each
Note will  indicate  either that such Note cannot be repaid at the option of the
Holder  prior to Stated  Maturity  or that such  Note will be  repayable  at the
option of the Holder on a date or dates  specified prior to Stated Maturity at a
price or  prices  set  forth  on the  Global  Security  and  applicable  Pricing
Supplement, together with accrued interest to the date of repayment.
Subordinated Bank Notes shall not be redeemable at the option of the Holder.

      In order for a Note that is  redeemable  at the option of the Holder to be
repaid,  the Fiscal and Paying  Agent must receive at least 30 days but not more
than 45 days prior to the repayment date (a) appropriate  wire  instructions and
(b)  either  (i) the Note with the form  entitled  "Option  to Elect  Repayment"
attached  to the  Note  duly  completed  or (ii) a  telegram,  telex,  facsimile
transmission  or letter from a member of a national  securities  exchange or the
National  Association of Securities Dealers,  Inc. or a commercial bank or trust
company in the United  States  setting forth the name of the Holder of the Note,
the principal  amount of the Note,  the portion of the  principal  amount of the
Note to be repaid,  the  certificate  number or a  description  of the tenor and
terms of the Note,  a  statement  that the  option to elect  repayment  is being
exercised  thereby  and a  guarantee  that the Note to be  repaid  with the form
entitled "Option to Elect Repayment" attached to the Note duly completed will be
received by the Fiscal and Paying Agent not later than five  Business Days after
the date of such telegram, telex, facsimile transmission or letter and such Note
and form duly  completed must be received by the Fiscal and Paying Agent by such
fifth  Business Day.  Exercise of the  repayment  option by the Holder of a Note
shall be irrevocable,  except as otherwise  described in the Offering  Circular.
The repayment  option may be exercised by the Holder of a Note for less than the
entire  principal  amount of the Note provided that the principal  amount of the
Note remaining  outstanding  after repayment is an authorized  denomination.  No
transfer or exchange of any Note (or, in the event that any Note is to be repaid
in part, the portion of the Note to be repaid) will be permitted  after exercise
of a repayment option. All questions as to the validity,  eligibility (including
time of receipt) and  acceptance of any Note for repayment will be determined by
the Fiscal and Paying  Agent,  whose  determination  will be final,  binding and
non-appealable.

      If a Note is represented by a Global Security,  the  Depositary's  nominee
will be the Holder of such Note and  therefore  will be the only entity that can
exercise a right to repayment.  In order to ensure that the Depositary's nominee
will timely exercise a right to repayment with respect to a particular Note, the
beneficial  owner of such  Note must  instruct  the  broker  or other  direct or
indirect  participant  through which it holds an interest in such Note to notify
the Depositary of its desire to exercise a right to repayment.  Different  firms
have different  cut-off times for accepting  instructions  from their  customers
and,  accordingly,  each  beneficial  owner  should  consult the broker or other
direct or indirect  participant  through which it holds an interest in a Note in
order to ascertain the cut-off time by which such an  instruction  must be given
in order for timely notice to be delivered to the Depositary.

      Unless otherwise  specified on the Global Security and applicable  Pricing
Supplement,  if a Note is an Original Issue Discount Note, the amount payable on
such Note in the event of redemption or repayment  prior to its Stated  Maturity
shall be the  Amortized  Face Amount of such Note,  as  specified  on the Global
Security and applicable  Pricing  Supplement,  as of the Redemption  Date or the
date of repayment, as the case may be.

      PROCEDURES FOR ESTABLISHING THE TERMS OF THE NOTES
      The Bank and the  Agent  will  discuss  from  time to time the rates to be
borne by the Notes that may be sold as a result of the solicitation of offers by
the Agent.  Once the Agent has recorded any  indication  of interest in Notes of
the Bank upon certain terms, and communicated with the Bank, if the Bank accepts
an offer to purchase  Notes upon such terms and if requested by the purchaser of
such Notes or the Agent,  it will prepare a supplement to the Offering  Circular
in the form previously approved by the Agent, reflecting the terms of such Notes
and, after approval from the Agent, will supply an appropriate  number of copies
of the Offering  Circular,  as then amended or supplemented,  together with such
supplement,  to the Agent. See "Delivery of Offering  Circular" below. If such a
supplement  to the Offering  Circular is  requested by a purchaser of Notes,  no
settlements  with respect to Notes upon such terms may occur prior to receipt by
the Agent of copies of such supplement, and the Agent will not, prior to receipt
of such  supplement,  mail a  confirmation  to a  customer  who has  offered  to
purchase  Notes  upon such  terms and has  requested  such a  supplement.  After
receipt by the Agent of such supplement,  sales,  mailing of  confirmations  and
settlements  may occur with  respect to Notes  upon such  terms,  subject to the
provisions of "Delivery of Offering Circular" below.

      If the Bank  decides  to post  rates and a  decision  has been  reached to
change interest rates,  the Bank will promptly notify the Agent.  The Agent will
forthwith  suspend  solicitation  of  purchases.  At that  time,  the Agent will
recommend  and the  Bank  will  establish  rates  to be so  "posted."  Following
establishment of posted rates, the Agent may only record indications of interest
in  purchasing  Notes at the posted rates.  See "Delivery of Offering  Circular"
below. If such a supplement to the Offering Circular is requested by a purchaser
of Notes,  no  settlements at the posted rates may occur prior to the receipt of
such  Offering  Circular  by the  Agent and the  Agent  will not,  prior to such
receipt,  mail  confirmations to customers who have offered to purchase Notes at
the posted rates. After receipt by the Agent of such supplement,  sales, mailing
of  confirmations  and  settlements  may resume,  subject to the  provisions  of
"Delivery of Offering Circular" below.

      SUSPENSION OF SOLICITATION; AMENDMENT OR SUPPLEMENT
      In the event that at the time the  Agent,  at the  direction  of the Bank,
suspends  solicitation  of offers to  purchase  from the Bank there shall be any
orders  outstanding  which have not been settled,  the Bank will promptly advise
the Agent and the Fiscal and Paying Agent whether such orders may be settled and
whether  copies  of  the  Offering   Circular  as  theretofore   amended  and/or
supplemented  as in effect at the time of the  suspension  may be  delivered  in
connection  with the  settlement  of such  orders.  The Bank  will have the sole
responsibility  for such decision and for any arrangements  which may be made in
the event that the Bank  determine  that such  orders may not be settled or that
copies of such Offering Circular may not be so delivered.

      DELIVERY OF OFFERING CIRCULAR
      A copy of the Offering  Circular as most recently  amended or supplemented
on the date of delivery thereof together with the applicable  Pricing Supplement
thereto,  must be delivered to a purchaser prior to or together with the earlier
of the delivery of (i) the written confirmation of a sale sent to a purchaser or
his agent and (ii) any Note purchased by such  purchaser.  The Bank shall ensure
that the Agent  receives  copies of the Offering  Circular and each amendment or
supplement thereto (including any applicable Pricing Supplement thereto) in such
quantities  and within such time limits as will enable the Agent to deliver such
confirmation or Note to a purchaser as  contemplated by these  procedures and in
compliance with the preceding sentence.  Copies of Pricing Supplements should be
delivered by telecopy to Donaldson,  Lufkin & Jenrette  Securities  Corporation,
140 Broadway, New York, New York 10005, Telecopy No.: (212) 504-8244, Attention:
Roger  Thomson  and  by  hand  to  Donaldson,   Lufkin  &  Jenrette   Securities
Corporation,  140  Broadway,  New York,  New York 10005.  If,  since the date of
acceptance  of a  purchaser's  offer,  the  Offering  Circular  shall  have been
supplemented  solely to reflect any sale of Notes on terms  different from those
agreed to between the Bank and such  purchaser  or a change in posted  rates not
applicable  to such  purchaser,  such  purchaser  shall not receive the Offering
Circular as supplemented by such new supplement,  but shall receive the Offering
Circular as  supplemented  to reflect the terms of the Notes being  purchased by
such  purchaser and otherwise as most recently  amended or  supplemented  on the
date of delivery of the Offering Circular. The Fiscal and Paying Agent will make
all such deliveries with respect to all Notes sold directly by the Bank.

      AUTHENTICITY OF SIGNATURES
      The Bank will cause the Fiscal and Paying  Agent to furnish the Agent from
time to time with the  specimen  signatures  of each of the  Fiscal  and  Paying
Agent's  officers,  employees and agents who have been  authorized by the Fiscal
and Paying Agent to authenticate Notes, but the Agent will have no obligation or
liability  to the  Bank  or the  Fiscal  and  Paying  Agent  in  respect  of the
authenticity  of the signature of any officer,  employee or agent of the Bank or
the Fiscal and Paying Agent on any Note.

      The Bank shall deliver the Notes signed on behalf of the Bank by its Chief
Executive Officer, any Executive Vice President, Treasurer, Assistant Treasurer,
Chief  Financial  Officer or Senior Vice  President  and General  Counsel or any
other officer  designated in writing by the Chief Executive Officer and attested
by its  Secretary  or  one  of its  Assistant  Secretaries,  provided  that  the
signature  of any such  officer  may,  but need not,  be a  facsimile  signature
imprinted  or  otherwise  reproduced  on  the  Notes;  and  in  case  any of the
above-named  officers of the Bank whose facsimile signature shall appear thereon
shall cease to hold such  office  before the Notes have been  authenticated  and
delivered  or disposed of by the Bank,  such Notes shall be valid as though such
person had not ceased to hold such position.

      ADVERTISING COSTS
      The  Bank  will  determine  with  the  Agent  the  amount  and  nature  of
advertising that may be appropriate in offering the Notes.  Advertising expenses
paid with the consent of the Bank will be paid by the Bank.


<PAGE>



                         PROCEDURES FOR BOOK-ENTRY NOTES

      Each Note will be represented by either a Global Security delivered to the
Fiscal and Paying Agent,  as custodian for the  Depositary,  and recorded in the
book-entry system maintained by the Depositary or a certificate delivered to the
holder thereof or a person  designated by such holder.  An owner of a Book-Entry
Note will not be entitled to receive a  certificate  representing  such Note. In
connection with the qualification of the Book-Entry Notes for eligibility in the
book-entry system maintained by the Depositary, the Fiscal and Paying Agent will
perform the custodial,  document control and administrative  functions described
below,  in  accordance  with  its  respective   obligations   under  Letters  of
Representations  from the Bank and the Fiscal and Paying Agent to the Depositary
and a Bank Note Certificate Agreement previously entered into between the Fiscal
and Paying Agent and the Depositary, and its obligations as a participant in the
Depositary,   including  the  Depositary's   Same-Day  Funds  Settlement  System
("SDFS"). Except as otherwise set forth in this Exhibit B, Book-Entry Notes will
be issued in accordance with the administrative procedures set forth below.

      ISSUANCE
      On any date of settlement (as defined under "Settlement" above) for one or
more Fixed Rate Book-Entry  Notes, the Bank will issue one or more single Global
Securities in fully  registered  form without  coupons each  representing  up to
$200,000,000  principal  amount of all of such Notes that have the same original
issuance date, interest rate, redemption and repayment  provisions,  if any, and
Stated Maturity. Similarly, on any settlement date for one or more Floating Rate
Book-Entry Notes, the Bank will issue a single Global Security each representing
up to  $200,000,000  principal  amount of all of such  Notes  that have the same
interest rate formula,  original issuance date, Initial Interest Rate,  Interest
Payment Dates, Index Maturity, Spread, Spread Multiplier,  minimum interest rate
(if any),  maximum  interest  rate (if any) and  Stated  Maturity.  Each  Global
Security  will be dated and issued as of the date of its  authentication  by the
Fiscal and Paying Agent. Each Global Security will have an interest accrual date
(the  "Interest  Accrual  Date"),  which will be (i) with respect to an original
Global Security (or any portion  thereof),  its original  issuance date and (ii)
with respect to any Global  Security (or portion  thereof)  issued  subsequently
upon  exchange of a Global  Security or in lieu of a  destroyed,  lost or stolen
Global  Security,  the most recent  Interest  Payment Date to which interest has
been paid or duly provided for on the predecessor  Global Security or Securities
(or if no such payment or provision has been made, the original issuance date of
the predecessor  Global  Security),  regardless of the date of authentication of
such subsequently issued Global Security.  No Global Security will represent (i)
both Fixed Rate and  Floating  Rate  Book-Entry  Notes or (ii) any  Certificated
Note.

      IDENTIFICATION NUMBERS
      The Bank,  will arrange,  on or prior to commencement of a program for the
offering  of the  Bank's  Book-Entry  Notes,  with the CUSIP  Service  Bureau of
Standard & Poor's  Corporation  (the "CUSIP Service Bureau") for the reservation
of a  series  of  CUSIP  numbers  (including  tranche  numbers),  consisting  of
approximately 900 CUSIP numbers and relating to Global  Securities  representing
the  Book-Entry  Notes.  The Fiscal and Paying Agent has or will obtain from the
CUSIP Service Bureau a written list of such series of reserved CUSIP numbers and
will  deliver  to the Bank and the  Depositary  such  written  list of 900 CUSIP
numbers of such series.  The Bank will assign CUSIP numbers to Global Securities
as described  below under  Settlement  Procedure "B." The Depositary will notify
the  CUSIP  Service  Bureau  periodically  of the CUSIP  numbers  that have been
assigned to Global Securities.  The Fiscal and Paying Agent will notify the Bank
at any time when fewer than 100 of the reserved CUSIP numbers remain  unassigned
to  Global  Securities,  and  if it  deems  necessary,  the  Bank  will  reserve
additional  CUSIP  numbers  for  assignment  to Global  Securities  representing
Book-Entry  Notes.  Upon obtaining such additional  CUSIP numbers the Fiscal and
Paying Agent shall  deliver such  additional  CUSIP  numbers to the Bank and the
Depositary.

      REGISTRATION
      Each  Global  Security  will be  registered  in the name of Cede & Co., as
nominee for the  Depositary,  on the Securities  Register  maintained  under the
Fiscal  and  Paying  Agency  Agreement  governing  such  Global  Security.   The
beneficial  owner of a Book-Entry Note (or one or more indirect  participants in
the Depositary designated by such owner) will designate one or more participants
in the  Depositary  (with respect to such Note,  the  "Participants")  to act as
agent  or  agents  for such  owner in  connection  with  the  book-entry  system
maintained by the Depositary, and the Depositary will record in book-entry form,
in accordance with instructions provided by such Participants,  a credit balance
with  respect to such Note in the account of such  Participants.  The  ownership
interest  of such  beneficial  owner in such Note will be  recorded  through the
records  of  such   Participants  or  through  the  separate   records  of  such
Participants and one or more indirect participants in the Depositary.

      TRANSFERS
      Transfers of a Book-Entry  Note will be  accomplished by book entries made
by the Depositary  and, in turn, by Participants  (and in certain cases,  one or
more indirect  participants  in the  Depositary)  acting on behalf of beneficial
transferors and transferees of such Note.

      CONSOLIDATION AND EXCHANGE
      The Fiscal and Paying  Agent may deliver to the  Depositary  and the CUSIP
Service Bureau at any time a written notice of consolidation  specifying (i) the
CUSIP numbers of two or more  outstanding  Global  Securities that represent (A)
Fixed Rate  Book-Entry  Notes having the same original  issuance date,  interest
rate and Stated Maturity and with respect to which interest has been paid to the
same date or (B) Floating  Rate  Book-Entry  Notes having the same interest rate
formula,  original issuance date, redemption and repayment  provisions,  if any,
Initial Interest Rate, Interest Payment Dates, Index Maturity,  Spread or Spread
Multiplier,  minimum interest rate (if any),  maximum interest rate (if any) and
with  respect to which  interest  has been paid to the same  date,  (ii) a date,
occurring  at least thirty days after such  written  notice is delivered  and at
least  thirty days before the next  Interest  Payment  Date for such  Book-Entry
Notes,  on  which  such  Global  Securities  shall  be  exchanged  for a  single
replacement Global Security and (iii) a new CUSIP number, obtained from the Bank
to be assigned  to such  replacement  Global  Security.  Upon  receipt of such a
notice,  the Depositary will send to its Participants  (including the Fiscal and
Paying Agent) a written  reorganization  notice to the effect that such exchange
will occur on such date.  Prior to the specified  exchange  date, the Fiscal and
Paying Agent will deliver to the CUSIP Service  Bureau a written  notice setting
forth such  exchange  date and the new CUSIP number and stating that, as of such
exchange date,  the CUSIP numbers of the Global  Securities to be exchanged will
no longer be valid. On the specified  exchange date, the Fiscal and Paying Agent
will exchange such Global  Securities for a single Global  Security  bearing the
new CUSIP number and a new Interest  Accrual Date,  and the CUSIP numbers of the
exchanged  Global  Securities  will,  in accordance  with CUSIP  Service  Bureau
procedures,  be cancelled and not immediately  reassigned.  Notwithstanding  the
foregoing,  if the Global  Securities  to be exchanged  exceed  $200,000,000  in
aggregate principal amount, one Global Security will be authenticated and issued
to represent  each  $200,000,000  of principal  amount of the  exchanged  Global
Securities and an additional Global Security will be authenticated and issued to
represent  any  remaining  principal  amount  of  such  Global  Securities  (see
"Denominations" below).

      MATURITIES
      Each Book-Entry Note which is a Senior Bank Note will mature on a date not
less than thirty days or more than thirty  years after the  settlement  date for
such Note. Each Book-Entry Note which is a Subordinated Bank Note will mature on
a date not less than five years nor more than thirty years after the  settlement
date for such Note.  A Floating  Rate  Book-Entry  Note will  mature  only on an
Interest Payment Date for such Note.

      NOTICE OF REDEMPTION AND REPAYMENT DATES
      The Fiscal and Paying  Agent will give notice to the  Depositary  prior to
each  redemption  date or repayment date (as specified in the Note),  if any, at
the time and in the manner set forth in the letter of  redemption.  With respect
to  redemptions,  such notice shall specify the amount of the redemption and the
date such  notice is to be mailed to the  beneficial  owners or  published  (the
"Publication  Date").  Such notice shall be sent to the  Depositary  by a secure
means (e.g., legible telecopy, registered or certified mail, overnight delivery)
in a timely  manner  designed to assure that such notice is in the  Depositary's
possession  no later than two business  days before the  Publication  Date.  The
Fiscal and Paying Agent shall  forward such notice  either in a separate  secure
transmission  for each CUSIP  number or in a secure  transmission  for  multiple
CUSIP numbers (if  applicable)  which  includes a manifest or list of each CUSIP
number submitted in that transmission.  The Fiscal and Paying Agent shall verify
the use of such means and the timeliness of such notice.  The  Publication  Date
shall  not be less than 30 days nor more  than 45 days  prior to the  redemption
date.

      With respect to repayment of Notes at the option of the holder, the Fiscal
and Paying  Agent  shall send notice to the  Depositary  on the day which is the
earlier  of 60  days  prior  to  the  purchase  date  or 5  days  prior  to  the
commencement  of the tender exercise  period,  and such notice shall specify the
CUSIP number of such issue,  the start date and end date of the tender  exercise
period,  the repayment price, and the purchase date. The Fiscal and Paying Agent
shall send such notice with  respect to an issue of Notes with a "one time only"
repayment option when such option arises;  in the case of an issue of Notes that
are  repayable on a regular  quarterly,  semi-annual,  annual,  or less frequent
cycle,  the Fiscal and Paying  Agent shall send such notice with respect to each
repayment  option as it arises,  or shall send such notice  with  respect to all
repayment options when the first such option arises;  and, for an issue of Notes
that are repayable on a regular monthly cycle, the Fiscal and Paying Agent shall
send such  notice  with  respect  to the first  repayment  option  and  annually
thereafter;  provided,  however,  the Fiscal and Paying Agent shall in all cases
promptly send notice of any change in the issue's  operational  terms  affecting
the repayment  options  (e.g. an upcoming  mandatory  tender),  when known.  The
Fiscal and Paying Agent  recognizes  that the Depositary  will use its Repayment
Option  Procedures,  a copy of which previously has been furnished to the Fiscal
and Paying Agent,  to process  tenders of the Notes. It is understood that under
the Repayment Option  Procedures the Depositary will receive daily  instructions
from its  Participants  to tender Notes for purchase.  On the purchase  date, if
after  paying the  Depositary  for  tendered  Notes the Fiscal and Paying  Agent
wishes to retire the tendered  Notes,  it shall notify the  Depositary to reduce
the principal amount of the issue of the Notes by the aggregate principal amount
of the  tendered  Notes and shall  reduce  the  principal  amount of the  Global
Security evidencing the tendered Notes accordingly.

      DENOMINATIONS
      Book-Entry  Notes will be issued in  principal  amounts of $250,000 or any
amount  in  excess  thereof  that is an  integral  multiple  of  $1,000.  Global
Securities  representing  one or more  Book-Entry  Notes will be  denominated in
principal amounts not in excess of $200,000,000. If one or more Book-Entry Notes
having an aggregate  principal  amount in excess of $200,000,000  would, but for
the preceding  sentence,  be represented by a single Global  Security,  then one
Global Security will be issued to represent each  $200,000,000  principal amount
of such  Book-Entry  Note or Notes and an  additional  Global  Security  will be
issued to represent any remaining  principal  amount of such  Book-Entry Note or
Notes.  In  such  a  case,  each  of the  Global  Securities  representing  such
Book-Entry Note or Notes shall be assigned the same CUSIP number.

      INTEREST
      General.  Interest on each  Book-Entry  Note will accrue from the Interest
Accrual  Date of the Global  Security  representing  such Note.  Each payment of
interest on a Book-Entry  Note will  include  interest  accrued  through the day
preceding, as the case may be, the Interest Payment Date or maturity;  provided,
however,  that if the  Interest  Reset  Dates with  respect to any such Note are
daily or weekly,  interest  payable on any  Interest  Payment  Date,  other than
interest  payable on any date on which principal for such Note is payable,  will
include interest accrued from but excluding the second preceding  Regular Record
Date to and including the next preceding  Regular Record Date.  Interest payable
at the maturity of a  Book-Entry  Note will be payable to the person to whom the
principal of such Note is payable.  Standard & Poor's  Corporation  will use the
information  received in the pending deposit message  described under Settlement
Procedure  "C" below in order to include the amount of any interest  payable and
certain  other  information   regarding  the  related  Global  Security  in  the
appropriate weekly bond report published by Standard & Poor's Corporation.

      On the first  Business  Day of  January,  April,  July and October of each
year,  the Fiscal and Paying Agent will deliver to the Bank and the Depositary a
written list of Regular Record Dates and Interest  Payment Dates that will occur
with  respect to Floating  Rate  Book-Entry  Notes during the  six-month  period
beginning on such first Business Day. Promptly after each Interest Determination
Date for Floating Rate Notes,  the Bank will notify the Fiscal and Paying Agent,
and the  Fiscal  and  Paying  Agent  in  turn  will  notify  Standard  &  Poor's
Corporation,  of the interest  rates  determined on such Interest  Determination
Date. The Bank and the Fiscal and Paying Agent shall take all steps necessary in
order for any interest  payment date on any issue of the Notes together with the
amount of interest payable, as well as changes in the interest rates on Floating
Rate  Notes as they  occur  from time to time,  to be listed in the  appropriate
daily bond report published by Standard & Poor's Corporation.

      PAYMENTS OF PRINCIPAL AND INTEREST
      Payments of Interest  Only.  Promptly  after each Regular Record Date, the
Fiscal and Paying  Agent will  deliver to the Bank and the  Depositary a written
notice  specifying  by CUSIP  number the amount of  interest  to be paid on each
Global Security on the following  Interest  Payment Date (other than an Interest
Payment Date  coinciding  with  maturity or an earlier  redemption  or repayment
date) and the total of such  amounts.  The  Depositary  will  confirm the amount
payable on each Global  Security on such  Interest  Payment Date by reference to
the daily bond reports published by Standard & Poor's Corporation. The Bank will
pay to the  Fiscal  and  Paying  Agent,  as paying  agent,  the total  amount of
interest due on such Interest Payment Date (other than at maturity or an earlier
redemption  or  repayment  date),  and the Fiscal and Paying Agent will pay such
amount to the  Depositary  at the times and in the manner set forth  below under
"Manner of Payment."

      Payments at  Maturity or Upon  Redemption  or  Repayment.  On or about the
first  Business  Day of each month,  the Fiscal and Paying Agent will deliver to
the Bank,  the  Depositary  and the Fiscal and  Paying  Agent a written  list of
principal  and interest to be paid on each Global  Security  maturing  either at
maturity or any redemption or repayment date in the following  month.  The Bank,
the Fiscal and Paying Agent and the Depositary  will confirm the amounts of such
principal and interest  payments with respect to each such Global Security on or
about the fifth  Business Day  preceding the maturity or redemption or repayment
date of such Global Security.  The Bank will pay to the Fiscal and Paying Agent,
as the paying agent, the principal amount of such Global Security, together with
interest due at such maturity or  redemption or repayment  date, as the case may
be. The Fiscal and Paying  Agent will pay such amount to the  Depositary  at the
times and in the manner set forth below under "Manner of Payment."

      Promptly after payment to the Depositary of the principal and interest due
at the maturity or  redemption  or repayment  date,  as the case may be, of such
Global  Security,  the Fiscal and Paying Agent will cancel such Global  Security
and  deliver  it to the Bank  with an  appropriate  debit  advice.  On the first
Business Date of each month,  the Fiscal and Paying Agent will prepare a written
statement indicating the total principal amount of outstanding Global Securities
for which it serves as fiscal and paying agent as of the  immediately  preceding
Business Day.

      Manner of Payment.  The total amount of any  principal and interest due on
Global Securities on any Interest Payment Date or at maturity or upon redemption
or  repayment  shall be paid by the Bank to the Fiscal and Paying Agent in funds
available  for use by the Fiscal and Paying Agent as of 9:30 A.M. (New York City
time) on such date. The Bank will make such payment on such Global Securities by
instructing  the  Fiscal  and  Paying  Agent to  withdraw  funds from an account
maintained  by the Bank at the Fiscal and Paying  Agent.  The Bank will  confirm
such  instructions  in writing to the Fiscal  and Paying  Agent.  For  maturity,
redemption  or any other  principal  payments:  prior to 10 A.M.  (New York City
time) on such date or as soon as  possible  thereafter,  the  Fiscal  and Paying
Agent will make such payments to the  Depositary in same day funds in accordance
with  the  Depositary's   Same  Day  Funds  Settlement  Paying  Agent  Operating
Procedures.  For interest  payments:  the Fiscal and Paying Agent will make such
payments to the Depositary in accordance with existing  arrangements between the
Depositary and the Fiscal and Paying Agent.  The  Depositary  will allocate such
payments  to  its  participants  in  accordance  with  its  existing   operating
procedures.  Neither  the Bank nor the Fiscal and  Paying  Agent  shall have any
direct  responsibility  or liability  for the payment by the  Depositary to such
Participants of the principal of and interest on the Book-Entry Notes.

      Indexed  Notes.  For all Indexed  Notes the Fiscal and Paying  Agent shall
notify the  Depositary of the amount of dollars to be paid per $1,000  principal
amount of Notes on any maturity date. Such notice shall be hand delivered to the
Depositary's  Reorganization  Department  by the close of business on the second
Business  Day  prior to the  maturity  date and shall  list the CUSIP  number(s)
assigned  to the  Note(s),  the dollar  amount of interest to be paid per $1,000
principal  amount of Notes and the maturity date. Such notices shall be given to
the Depositary by facsimile and hard copy.

      Withholding  Taxes.  The amount of any taxes required under applicable law
to be withheld from any interest payment on a Book-Entry Note will be determined
and withheld by the Participant, indirect participant in the Depositary or other
person  responsible  for  forwarding  payments  and  materials  directly  to the
beneficial owner of such Note.

      EXTENSIONS OF MATURITY AND INTEREST RATE RESETS
      Extensions  of  Maturity.  In the event of an  extension  of maturity of a
Note,  the Bank  shall  give  notice  to the  Fiscal  and  Paying  Agent of such
extension at least 36 days prior to the original  maturity  date. The Fiscal and
Paying Agent will, at least 35 days prior to the original maturity date, deliver
a notice to the  Depositary  specifying  the CUSIP  number of the Note,  the new
maturity  date of the Note and if the rate is being  changed,  the new  interest
rate for the Note and the day such rate  takes  effect.  The  holder of the Note
will have the option to elect  repayment of such Note on the  original  maturity
date.  Therefore,  such notice to the Depositary  shall also list the start date
and end date of the  upcoming  exercise  period,  the  repayment  price  and the
purchase date (original  maturity date). The Fiscal and Paying Agent will notify
Standard & Poor's  Corporation and Interactive  Data Corporation of any maturity
extensions.  Such notice shall include the CUSIP number of the Note, the revised
Stated Maturity, and if the rate is being changed, the new interest rate for the
Note and the day such rate takes  effect.  If the Note is a Floating  Rate Note,
the  Fiscal  and  Paying  Agent  will  continue  to  notify  Standard  &  Poor's
Corporation and Interactive Data Corporation of the rate change information.

      Interest Rate Reset.  In the event the Bank elects to change the rate on a
Fixed Rate Note,  it shall  give  notice to the Fiscal and Paying  Agent of such
change at least 36 days  prior to the date the new rate is to take  effect.  The
Fiscal and Paying Agent will, at least 35 days prior to the date the new rate is
to take effect,  deliver a notice to the Depositary  specifying the CUSIP number
of the Note,  the new  interest  rate on the Note and the date such rate  change
takes effect. The Holder will have the option to elect repayment of such Note on
the next interest payment date.  Therefore,  such notice to the Depositary shall
also list the start date and the end date of the upcoming  exercise period,  the
repayment  price and the  purchase  date.  The Fiscal and Paying Agent will also
notify Standard & Poor's  Corporation and Interactive  Data  Corporation of rate
changes on Fixed Rate Notes.  Such notice shall  include the CUSIP number of the
Note, the new interest rate on the Note and the date such rate change is to take
effect.  All resets of rates on  Floating  Rate Notes  will be  communicated  to
Standard & Poor's and Interactive Data Corporation.

      After the end of the repayment exercise periods with respect to the Bank's
option to reset interest rate or extend  maturities as set forth above, the Bank
may elect to  increase  the  interest  rates on the Notes and allow  holders  to
withdraw  their  repayment  instructions.  In such event,  the Fiscal and Paying
Agent will,  at least 15 days prior to the repayment  date,  deliver a notice to
the  Depositary  specifying  the CUSIP number of the Note, the new interest rate
for the Note,  the date such rate change takes effect and the final date for the
submission of withdrawal of repayment option instructions. The Fiscal and Paying
Agent  will also  notify  Standard & Poor's  Corporation  and  Interactive  Data
Corporation of any such increase in interest rates.

      SETTLEMENT PROCEDURES
      Settlement Procedures with regard to each Book-Entry Note sold by the Bank
through the Agent, as agent, shall be as follows:



<PAGE>


================================================================================
     The Agent will advise the Bank by  telephone,  telex or  facsimile,  of the
following settlement information:
==============================================================================

         1.                          Exact name in which the Note is to be
                                     registered ("Registered Owner").
         2.                          Exact  address of the  Registered  Owner
                                     and address for payments of principal
                                     and interest, if any.
         3.                          Taxpayer identification number of the
                                     Registered Owner.
         4.                          Principal  amount  of the Note  (and,  if 
                                     multiple  Notes  are to be  issued,
                                     denominations thereof).
         5.                          Settlement date.
         6.                          Stated Maturity and whether the Stated 
                                     Maturity can be extended.
         7.                          Issue Price and any OID information.
         8.                          Trade date.
         9.                          The Depositary Participant account number
                                     of the Agent.
         10.                         Interest rate:
               (a)                   Fixed Rate Notes:
                      i)             interest rate
                      ii)            overdue rate, if any
                      iii)           interest payment dates
                      iv)            date or dates,  if any, on which the 
                                     interest  rate may be reset and the basis
                                     or formula, if any, for such resetting



               (b)                   Floating Rate Notes:



                      i)             interest rate basis
                      ii)            initial interest rate
                      iii)           spread or spread multiplier, if any
                      iv)            interest rate reset periods
                      v)             interest payment dates
                      vi)            index maturity
                      vii)           maximum and minimum interest rates, if any
                      viii)          record dates
                      ix)            interest determination dates
                      x)             overdue rate, if any
                      xi) date or dates,  if any,  on which the spread or spread
                      multiplier may be reset and the basis or formula,  if any,
                      for such resetting.



         11. The date on or after  which  the  Notes 
         are  redeemable  at the  option of the
         Bank, and additional redemption or repurchase provisions, if any.

         12. Wire transfer information.

         13. Agent's  commission  (to be paid in the
         form of a discount  from the  proceeds
         remitted to the Bank upon settlement).

         14. Whether the Note is a Senior Bank Note or a Subordinated Bank Note.



     B. The Bank will assign a CUSIP number to the Global Security  representing
     such  Note and  then  advise  the  Fiscal  and  Paying  Agent by  telephone
     (confirmed  in  writing  at  any  time  on the  same  date)  or  electronic
     transmission  of the  information  set forth in  Settlement  Procedure  "A"
     above, such CUSIP number and the name of the Agent.



     C. The Fiscal and Paying Agent will enter a pending deposit message through
     the  Depositary's  Participant  Terminal  System,  providing  the following
     settlement  information to the Depositary,  the Agent and Standard & Poor's
     Corporation:



         1.  The information set forth in Settlement Procedure "A."

         2.  Identification  as a Fixed Rate  Book-Entry Note or a Floating 
         Rate Book-Entry Note.

         3. Initial Interest Payment Date for such Note, number of days by which
         such date  succeeds  the related  "Depositary  Record Date" (which term
         means the Regular Record Date except in the case of floating rate notes
         which  reset daily or weekly in which case it means the date 5 calendar
         days  immediately  preceding  the Interest  Payment Date) and amount of
         interest payable on such Interest Payment Date.

         4. Frequency of interest payments (monthly, semiannually, quarterly,
         etc.).

         5. CUSIP number of the Global Security representing such Note.

         6. Whether such Global Security will represent any other  Book-Entry
         Note (to the extent known at such time).

         7. The number of  Participant  accounts to be  maintained  by the 
         Depositary  on  behalf of the Agent or the Fiscal and Paying Agent.



     D.    The  Fiscal  and  Paying  Agent  will  complete  and   authenticate
     the  note certificate evidencing the Global Security representing such
     Book-Entry Note.



     E.    The  Depositary  will  credit  such Note to such  Fiscal  and 
     Paying  Agent's participant account at the Depositary.



     F. The Fiscal and Paying Agent will enter an SDFS deliver order through the
     Depositary's  Participant Terminal System instructing the Depositary to (i)
     debit such Note to such Fiscal and Paying Agent's  participant  account and
     credit  such Note to the  Agent's  participant  account  and (ii) debit the
     Agent's  settlement  account  and credit  such  Fiscal  and Paying  Agent's
     settlement  account for an amount  equal to the price of such Note less the
     Agent's commission.



     G. The Agent will enter an SDFS  deliver  order  through  the  Depositary's
     Participant  Terminal  System  instructing the Depositary (i) to debit such
     Note  to the  Agent's  participant  account  and  credit  such  Note to the
     participant accounts of the Participants with respect to such Note and (ii)
     to debit the  settlement  accounts  of such  Participants  and  credit  the
     settlement  account  of the Agent for an amount  equal to the price of such
     Note.



     H. Transfers of funds in accordance  with SDFS deliver orders  described in
     Settlement  Procedures "F" and "G" will be settled in accordance  with SDFS
     operating procedures in effect on the settlement date.



     I. The Fiscal and Paying  Agent will credit to an account of the Bank
     maintained at such Fiscal and Paying Agent funds  available for immediate
     use in the amount  transferred  to such Fiscal
     and Paying Agent in accordance with Settlement Procedure "F."



     J. The  Agent  will  deliver  to the  purchaser  a copy of the most  recent
     Offering Circular applicable to the Note with or prior to any written offer
     of Notes and the confirmation and payment by the purchaser of the Note.

     The Agent will confirm the purchase of such Note to the purchaser either by
     transmitting to the  Participants  with respect to such Note a confirmation
     order or orders through the Depositary's  institutional  delivery system or
     by mailing a written confirmation to such purchaser.



                         SETTLEMENT PROCEDURES TIMETABLE
 For orders of Book-Entry  Notes solicited by the Agent, as agent,  and accepted
by the Bank for  settlement,  Settlement  Procedures  "A"  through "J" set forth
above shall be completed  as soon as possible but not later than the  respective
times (New York City time) set forth below:



=======================  ===================================================
SETTLEMENT PROCEDURES
                                               TIME
=======================  ===================================================
=======================  ===================================================
         A-B             11:00 A.M. on the Sale date
=======================  ===================================================
          C              2:00 P.M. on the Sale date
=======================  ===================================================
          D              3:00 P.M. on date before Settlement date
=======================  ===================================================
          E              10:00 A.M. on Settlement date
=======================  ===================================================
         F-G             2:00 P.M. on Settlement date
=======================  ===================================================
          H              4:45 P.M. on Settlement date
=======================  ===================================================
         I-J             5:00 P.M. on Settlement date
=======================  ===================================================



  If a sale is to be  settled  more than one Business Day after the sale date,
Settlement Procedures "A," "B" and "C" shall be completed as soon as practicable
but no later  than 11:00  A.M.  and 2:00 P.M.,  as the case may be, on the first
Business Day after the sale date.  If the initial  interest  rate for a Floating
Rate  Book-Entry  Note  has not been  determined  at the  time  that  Settlement
Procedure "A" is completed, Settlement Procedures "B" and "C" shall be completed
as soon as such rate has been  determined but no later than 11:00 A.M. and 12:00
Noon,  respectively,  on the second  Business  Day before the  settlement  date.
Settlement  Procedure  "I" is  subject  to  extension  in  accordance  with  any
extension of Fedwire closing  deadlines and in the other events specified in the
SDFS operating procedures in effect on the settlement date.



  If settlement of a Book-Entry Note is rescheduled or canceled, the Fiscal and
Paying  Agent  will  deliver  to  the  Depositary,   through  the   Depositary's
Participant  Terminal System, a cancellation  message to such effect by no later
than  2:00  P.M.  on  the  Business  Day  immediately  preceding  the  scheduled
settlement date.

                                    FAILURE TO SETTLE
  If the  Fiscal and Paying Agent fails to enter an SDFS deliver order with
respect to a Book-Entry  Note pursuant to Settlement  Procedure  "F," the Fiscal
and  Paying  Agent may  deliver  to the  Depositary,  through  the  Depositary's
Participant  Terminal  System,  as  soon as  practicable  a  withdrawal  message
instructing  the  Depositary to debit such Note to the Fiscal and Paying Agent's
participant  account.  The  Depositary  will  process  the  withdrawal  message,
provided  that the Fiscal  and Paying  Agent's  participant  account  contains a
principal amount of the Global Security  representing such Note that is at least
equal  to the  principal  amount  to be  debited.  If a  withdrawal  message  is
processed  with  respect to all the  Book-Entry  Notes  represented  by a Global
Security, the Fiscal and Paying Agent will mark such Global Security "canceled,"
make appropriate  entries in the Fiscal and Paying Agent's records and send such
canceled  Global  Security to the Bank. The CUSIP number assigned to such Global
Security shall, in accordance with CUSIP Service Bureau procedures,  be canceled
and not  immediately  reassigned.  If a  withdrawal  message is  processed  with
respect to one or more,  but not all, of the Book-Entry  Notes  represented by a
Global Security,  the Fiscal and Paying Agent will exchange such Global Security
for two Global Securities,  one of which shall represent such Book-Entry Note or
Notes and shall be canceled  immediately  after  issuance and the other of which
shall  represent  the  other  Book-Entry  Notes  previously  represented  by the
surrendered  Global  Security and shall bear the CUSIP number of the surrendered
Global Security.



 If the  purchase  price  for  any  Book-Entry  Note is not  timely  paid to the
Participants with respect to such Note by the beneficial purchaser thereof (or a
person, including an indirect participant in the Depositary, acting on behalf of
such  purchaser),  such  Participants  and,  in turn,  the Agent may enter  SDFS
deliver orders through the  Depositary's  Participant  Terminal System reversing
the orders entered pursuant to Settlement  Procedures "F" and "G," respectively.
Thereafter,  the Fiscal and Paying Agent will deliver the withdrawal message and
take the related actions described in the preceding paragraph.



 Notwithstanding  the  foregoing, upon any failure to settle with  respect to a
Book-Entry Note, the Depositary may take any actions in accordance with its SDFS
operating  procedures  then in effect.  In the event of a failure to settle with
respect  to one or  more,  but not all,  of the  Book-Entry  Notes to have  been
represented by a Global Security,  the Fiscal and Paying Agent will provide,  in
accordance with Settlement Procedure "D," for the authentication and issuance of
a  Global  Security  representing  the  other  Book-Entry  Notes  to  have  been
represented  by such Global  Security and will make  appropriate  entries in its
records.



<PAGE>



                    SPECIAL PROCEDURES FOR CERTIFICATED NOTES

                                    DENOMINATIONS
 Certificated  Notes  will  be  issued  and  payable  in  U.S.  dollars  in  the
denomination of $250,000 and any larger denomination which is an integral
multiple of $1,000.



                                    MATURITY
 Upon  presentation  of each Note at maturity  the Fiscal and Paying  Agent will
pay the principal  amount thereof,  together with accrued  interest  through the
date of redemption. Such payment shall be made in immediately available funds in
U.S. dollars, provided that the Note is presented to the Fiscal and Paying Agent
in time for the  Fiscal  and  Paying  Agent to make  payments  in such  funds in
accordance  with its normal  procedures.  The Bank will  provide  the Fiscal and
Paying Agent with funds  available for  immediate  use for such  purpose.  Notes
presented  at  maturity  will be  cancelled  by the Fiscal  and Paying  Agent as
provided in the Fiscal and Paying Agency Agreement.



                                    SETTLEMENT PROCEDURES
 In the event of a purchase of  Certificated  Notes by the Agent,  as principal,
appropriate  Settlement  details  will be set forth in the  applicable  Purchase
Agreement  to be entered  into  between  the Agent and the Bank  pursuant to the
Distribution Agreement.



      Settlement  procedures with regard to each  Certificated Note sold through
the Agent shall be as follows:





<PAGE>


===============================================================================

================================================================================





                                                        

           The Agent will advise the Bank by telephone,  telex or facsimile,  of
the following Settlement information:



                A.     Registered Owner.

                B.     Exact  address of the  Registered  Owner and  address 
                for  payment of  principal  and interest, if any.

                C.     Taxpayer identification number of the Registered Owner.

                D.     Principal  amount of the Note (and, if multiple Notes
                are to be issued,  denominations thereof).

                E.     Settlement date.

                F.     Stated Maturity and whether the Stated Maturity can be
                extended.

                G.     Issue Price and any OID information.

                H.     Trade Date/Original Issue Date.

                I.     Interest rate:



                      1. Fixed Rate Certificated Notes:



                      a.    interest rate
                      b. overdue rate, if any
                      c. interest payment dates
                      d. date or dates, if any, on which the interest rate 
                      may be reset and the basis or formula, if any, for such 
                      resetting



                      2. Floating Rate Certificated Notes:



                      a.    interest rate basis
                      b. initial interest rate
                      c. spread or spread multiplier, if any
                      d. interest rate reset periods
                      e. interest payment dates
                      f. index maturity
                      g. maximum and minimum interest rates, if any
                      h. record dates
                      i. interest determination dates
                      j. overdue rate, if any
                      k. date or dates, if any, on which the spread or spread 
                      multiplier may be reset and the basis or formula for such
                      resetting



           J.    The date on or after which the  Certificated  Notes are 
           redeemable at the option of the Bank, and
           additional redemption or repurchase provisions, if any.

           K.    Wire transfer information.

           L.    Agent's  commission  (to be paid in the form of a discount
           from the proceeds  remitted to the Bank upon Settlement).

           M.    That the Note will be a Certificated Note.

           N.    Whether the Note is a Senior Bank Note or a Subordinated 
           Bank Note.



           II. The Bank,  will confirm the above  Settlement  information to the
Fiscal and Paying Agent by  telephone,  telex or  facsimile,  and the Fiscal and
Paying Agent will assign a Note number to the  transaction.  If the Bank rejects
an offer,  the Bank will  promptly  notify  the Agent and the  Fiscal and Paying
Agent by telephone.



           III. The Fiscal and Paying Agent will  complete the first page of the
preprinted  4-ply Note packet the form of which was  previously  approved by the
Bank, the Agent and the Fiscal and Paying Agent.



           IV. The Fiscal and Paying  Agent will deliver the  Certificated  Note
(with the  attached  white  confirmation)  and the  yellow and blue stubs to the
Agent. The Agent will acknowledge receipt of the Certificated Note by completing
the yellow stub and returning it to the Fiscal and Paying Agent.



           V.    The Agent will cause to be wire  transferred to a bank account
designated by the Bank immediately available  funds in U.S.  dollars  in the
amount  of the  principal  amount  of the  Certificated  Note,  less the
applicable commission or discount, if any.



           VI. The Agent will deliver the  Certificated  Note (with the attached
white  confirmation) to the purchaser  against payment in immediately  available
funds in the amount of the principal amount of the Certificated  Note. The Agent
will  deliver  to the  purchaser  a copy of the most  recent  Offering  Circular
applicable  to the  Certificated  Note  with or  prior to any  written  offer of
Certificated  Notes,  delivery of the Certificated Note and the confirmation and
payment by the purchaser for the Certificated Note.



           VII.  The Agent will  obtain  the  acknowledgment  of receipt  for
the  Certificated  Note and  Offering Circular by the purchaser through
the purchaser's completion of the blue stub.



           VIII. The Fiscal and Paying Agent will mail the pink stub to the
Bank.



<PAGE>


      SETTLEMENT PROCEDURES TIMETABLE
      For  offers  to  purchase   certificated  Notes,  accepted  by  the  Bank,
Settlement  procedures  "A" through "H" set forth above shall be completed on or
before the respective times set forth below:



=======================  ===================================================
      SETTLEMENT
      PROCEDURE                           TIME (NEW YORK)
=======================  ===================================================
=======================  ===================================================
          A              5 P.M. on date of order
=======================  ===================================================
          B              3 P.M. on the Business Day prior to Settlement
                         Date
=======================  ===================================================
         C-D             12 Noon on the Settlement Date
=======================  ===================================================
          E              2:15 P.M. on the Settlement Date
=======================  ===================================================
         F-G             3 P.M. on the Settlement Date
=======================  ===================================================
          H              5 P.M. on Business Day after the Settlement Date
=======================  ===================================================


      FAILURE TO SETTLE
      In the event that a purchaser of a Certificated  Note shall either fail to
accept delivery of or make payment for such  Certificated Note on the date fixed
by the Bank, the Agent will  immediately  notify the Fiscal and Paying Agent and
the Bank by  telephone,  confirmed  in writing,  of such  failure and return the
Certificated  Note to the Fiscal and  Paying  Agent.  Upon the Fiscal and Paying
Agent's receipt of the Certificated  Note from the Agent, the Bank will promptly
return to the Agent an amount of  immediately  available  funds in U.S.  dollars
equal  to any  amount  previously  transferred  to the  Bank in  respect  of the
Certificated  Note pursuant to advances made by the Agent.  Such returns will be
made on the  Settlement  date,  if possible,  and in any event not later than 12
noon (New York City time) on the Business Day following the Settlement date. The
Bank will  reimburse the Agent on an equitable  basis for its loss of the use of
the funds  during the period when the funds were  credited to the account of the
Bank.  Upon  receipt of the  Certificated  Note in respect of which the  default
occurred,   the  Fiscal  and  Paying  Agent  will  mark  the  Certificated  Note
"cancelled,"   make   appropriate   entries  in  its  records  and  deliver  the
Certificated Note to the Bank with an appropriate  debit advice.  The Agent will
not be entitled to any commission  with respect to any  Certificated  Note which
the purchaser does not accept or make payment for.



<PAGE>

[TYPE]EX-10
 Exhibit 10(b).

                       FISCAL AND PAYING AGENCY AGREEMENT

                                     Between

                   TRANS FINANCIAL BANK, NATIONAL ASSOCIATION

                                       and

                           FIRST FIDELITY BANK, N.A.,

                           as Fiscal and Paying Agent

                         Dated as of September 28, 1995


<PAGE>


                  This Fiscal and Paying Agency  Agreement dated as of September
28, 1995 between Trans Financial  Bank,  National  Association  (the "Bank") and
First  Fidelity Bank,  N.A., as fiscal and paying agent (in such  capacity,  the
"Fiscal and Paying Agent").  Capitalized  terms not otherwise defined below have
the meaning set forth in the Bank Notes.


<PAGE>


 .
                  WHEREAS the Bank  proposes to issue and sell from time to time
its bank notes (the "Bank  Notes")  in an  aggregate  principal  amount of up to
$250,000,000;

                  WHEREAS  the Bank  Notes may be issued by the Bank as  "Senior
Bank Notes", which will rank equally with all other unsecured and unsubordinated
indebtedness of the Bank (other than deposits, to the extent provided by federal
law and any applicable state law), or as "Subordinated  Bank Notes",  which will
be  subordinated  to all present  and future  claims of  depositors  and general
creditors of the Bank;

                  WHEREAS  the Bank Notes  will be offered  for sale by the Bank
through Donaldson,  Lufkin & Jenrette Securities  Corporation,  as agent for the
Bank (the  "Agent"),  and may also be sold by the Bank to the Agent as principal
for resale to investors or by the Bank directly to investors;

                  WHEREAS  the Bank  desires  to  appoint  the Fiscal and Paying
Agent as fiscal and paying  agent of the Bank with  respect to the  preparation,
authentication, delivery, registration and payment of the Bank Notes;

                  NOW, THEREFORE, the parties hereto hereby agree as follows:


                                        APPOINTMENT       
Appointment  of Fiscal and Paying  Agent.  The Fiscal and Paying Agent is hereby
appointed  as  fiscal  and  paying  agent  for the Bank  Notes on the  terms and
conditions  specified in this Agreement,  and the Fiscal and Paying Agent hereby
accepts such appointment.


                               THE BANK NOTES

Form of Bank  Notes.  All Fixed  Rate Notes  issued by the Bank  having the same
Original Issue Date, Interest Rate,  Interest Payment Dates,  Initial Redemption
Date (if any),  Redemption  Terms,  and Stated Maturity will be represented by a
single note  certificate  and all Floating  Rate Notes issued by the Bank having
the same Original Issue Date, Initial Interest Rate,  Interest Rate Basis, Index
Maturity, Spread (if any), Spread Multiplier (if any), Minimum Interest Rate (if
any), Maximum Interest Rate (if any), Interest Reset Dates,  Interest Rate Reset
Period,  Initial Redemption Date (if any),  Redemption Terms (if any),  Interest
Payment Dates,  Interest Payment Period and Stated Maturity and which are Senior
Bank Notes or  Subordinated  Bank Notes, as the case may be, will be represented
by a single note certificate,  each such note certificate  hereinafter  called a
"Global Bank Note." All Global Bank Notes shall be registered in the name of The
Depository  Trust  Company  ("DTC")  or a nominee  of DTC,  as  depositary  (the
"Depositary").  All Global Bank Notes  representing Fixed Rate Notes shall be in
the form attached  hereto as Exhibit A-1 (for Global Bank Notes with  maturities
from 30 days to 1 year ("Short-Term  Notes")) or A-2 (for Global Bank Notes with
maturities from 1 year to 30 years ("Medium-Term  Notes")),  and all Global Bank
Notes  representing  Floating Rate Notes shall be in the form attached hereto as
Exhibit B-1 (for Short-Term  Notes) or B-2 (for Medium-Term  Notes).  Beneficial
interests in Global Bank Notes will be shown on, and  transfers  thereof will be
effected only through, records maintained by DTC and its participants.

Certificates of Authorized  Representatives  of the Bank. From time to time, the
Bank shall furnish the Fiscal and Paying Agent with a certificate of the Bank in
the form attached  hereto as Exhibit C certifying  the  incumbency  and specimen
signatures of  representatives of the Bank authorized to instruct the Fiscal and
Paying  Agent  regarding  the  completion  and delivery of the Bank's Bank Notes
(each an "Authorized Representative"). Until five Business Days after the Fiscal
and Paying Agent receives a subsequent  incumbency  certificate of the Bank, the
Fiscal and Paying  Agent shall be entitled to rely on the last such  certificate
delivered to it for purposes of determining the Authorized Representatives.  The
Fiscal and Paying  Agent shall have no  responsibility  to the Bank to determine
whether a  signature  of an  Authorized  Representative  is  genuine  or if such
signature resembles the specimen signature of such Authorized  Representative on
such certificate.

Completion, Authentication and Delivery., Authentication and Delivery

  All Global Bank Notes shall be issued and delivered in accordance with this
Agreement,  the Global Bank Notes, the Letters of Representations  from the Bank
and the  Fiscal and Paying  Agent to DTC and the  Medium  Term Note  Certificate
Agreement  between the Fiscal and Paying  Agent and DTC dated as of December 27,
1989 (the "Additional Agreements"), and to the extent not inconsistent therewith
or  herewith,  the  administrative  procedures  attached  hereto as  Exhibit  D.
However,  in the event of a  conflict,  the terms of the Global Bank Notes shall
govern.  All  instructions  regarding the completion and delivery of Global Bank
Notes  shall  be given  by an  Authorized  Representative  by  telex,  telecopy,
electronic means or other means acceptable to the Fiscal and Paying Agent.  Upon
receipt of instructions as described in the preceding  sentence,  the Fiscal and
Paying Agent shall:

                              complete a Global Bank Note or Notes representing
                  one or more Bank Notes in
                  accordance with such instructions;

                              manually  countersign and authenticate such Global
                  Bank Note or Notes by any one of the  officers or employees of
                  the Fiscal and Paying Agent duly  authorized and designated by
                  it for such purpose; and

                  deliver such Global Bank Note to DTC or pursuant to DTC's
                  instructions.

  If any Global Bank Note has been countersigned by one of the Fiscal and Paying
Agent's  officers  who was duly  authorized  for such  purpose but who is not so
designated  at the time said  Global  Bank Note is to be paid,  the  Fiscal  and
Paying  Agent is  authorized  and will pay the Global Bank Note  notwithstanding
that the  authority  of said  officer  has been  terminated  between the time of
execution and the time of payment.

   In the event a discrepancy exists between the instructions as originally
received by the Fiscal and Paying Agent and any subsequent written confirmation
thereof, such original instructions will be deemed controlling,  provided that
the Fiscal and Paying Agent gives notice to the Bank of such discrepancy
promptly upon the receipt of such written confirmation.

 Should the Fiscal and Paying Agent at any time request or receive an opinion
of itscounsel (which includes  in-house counsel)  concerning its duties 
hereunder,  it shall be free to act upon the  advice  contained  in such 
opinion  and shall be relieved of any liability under this Agreement
in so acting.

  All instructions must be received by the Fiscal and Paying Agent by 11 a.m.,
New York time, on the second  Business Day preceding  the Original  Issue Date.
For purposes  hereof,  the  term  "Business  Day"  shall  mean any day that is 
not a Saturday  or Sunday  and that,  in the City of New York and the City of
Bowling Green,  Kentucky is not a day on which banking  institutions  or trust
companies are generally authorized or obligated by law or executive order to
close.

  The Fiscal and Paying Agent shall incur no liability to the Bank in acting
hereunder  upon  instructions  contemplated  hereby which the recipient  thereof
believed in good faith to have been given by an Authorized Representative.

  Each instruction given to the Fiscal and Paying Agent in accordance with this
Section 2.3 shall  constitute  a  representation  and warranty to the Fiscal and
Paying Agent by the Bank that the issuance and delivery of the Bank Note or Bank
Notes to which the instruction  relates have been duly and validly authorized by
the Bank  that  such  Bank Note or Bank  Notes  when  completed,  countersigned,
authenticated and delivered  pursuant hereto,  will constitute valid and legally
binding  obligations  of the  Bank,  and  that the  Fiscal  and  Paying  Agent's
appointment  to act for the Bank  hereunder  has  been  duly  authorized  by all
necessary corporate action of the Bank.

Denominations.  Except as  provided in Section  2.5(b),  the Bank Notes shall be
issuable only in book-entry form,  without coupons.  Bank Notes will be issuable
in denominations of $250,000 and integral multiples of $1,000 in excess thereof.

Proceeds of Sale of the Bank Notes; Resignation by DTC.ank Notes; Resignation 
by DTC

Funds received in payment for Bank Notes shall be credited to an account of the
Bank, as instructed by the Bank.

If at any time (i) DTC notifies the Bank that it is unwilling or unable t
continue as  Depositary  for the Bank  Notes or if DTC  ceases  to be a  
clearing  agency registered  under  the  Securities  Exchange  Act of  1934,
as  amended,  and a successor  depositary  is not appointed by the Bank within
ninety days after the effective  date of DTC's ceasing to act as depositary
for the Bank's Bank Notes, (ii) the Bank,  at its option,  notifies  the Fiscal
and Paying Agent in writing that it elects to cause the issuance of Bank Notes
in  definitive  form or (iii) any event shall have happened and be continuing
which,  after notice or lapse of time,  or both,  would  constitute  an event
of default with respect to the Bank Notes, the Fiscal and Paying Agent will, 
upon the execution of the then standard form of the Fiscal and Paying Agent's 
agreement for certificated  securities and upon receipt of instructions in 
writing from the Bank,  authenticate and deliver Bank Notes of like tenor and
terms in definitive form in an aggregate  principal
amount equal to the principal  amount of the Global Bank Notes then  outstanding
in exchange for such Global Bank Notes. Any such certificated Bank Notes will be
issued  in  fully  registered  form  to  the  persons  designated  by DTC as the
beneficial owners thereof,  without coupons, in denominations of $250,000 or any
amount in excess thereof which is an integral multiple of $1,000.

Registration, Registration of Transfer and Exchange. The Fiscal and Paying Agent
shall, so long as any of the Bank Notes remain outstanding, maintain all records
as may be  customary,  including all forms of transfer for the Global Bank Notes
and shall:

   Keep at its corporate trust office in Philadelphia, Pennsylvania (the "Debt
Securities  Administration  Office"),  registers (the "Bank Note  Registers") in
such form as the Fiscal and Paying  Agent may  determine,  in which,  subject to
such  reasonable  regulations  as it may  prescribe,  it shall  provide  for the
registration of each Bank's Bank Notes and of transfers thereof;

   Maintain records showing for each outstanding Bank Note the principal amount,
maturity date, interest rate or interest rate basis and other terms thereof; the
date of  original  issue and all  subsequent  transfers  and  consolidations  or
exchanges;   provided   that  the  Fiscal  and  Paying   Agent   shall  have  no
responsibility  or  liability  for any  aspect  of the  records  relating  to or
payments made on account of beneficial ownership interests in a Global Bank Note
or for  maintaining,  supervising  or  reviewing  any  records  relating to such
beneficial  ownership  interests,  and it shall be fully  protected in acting or
refraining from acting on any such information provided by DTC.

  Require that all Bank Notes presented for transfer shall be duly endorsed or
be accompanied by a written instrument of transfer.

  Require that each Bank Note shall bear an Original
Issue Date which shall remainthe same for all Bank Notes  subsequently 
issued  upon  transfer,  exchange  or substitution  of such original 
Bank Note  regardless of the date of issuance of
any such subsequently  issued Bank Note; provided that the Interest Accrual Date
for a Bank Note issued subsequently upon exchange of a Bank Note or in lieu of a
destroyed,  lost or stolen Bank Note shall be the most recent  Interest  Payment
Date to which  interest has been paid or duly  provided  for on the  predecessor
Bank Note.  The Fiscal and Paying  Agent shall not be  required to register  the
transfer of or exchange any Bank Note during the period of 15 days preceding any
Interest Payment Date, date of redemption, date of repayment or Stated Maturity.
In  addition,  the Fiscal and Paying Agent shall not be required (i) to register
the  transfer  of or  to  exchange  any  Bank  Notes  for a  period  of 15  days
immediately  preceding any date fixed for selection of Bank Notes to be redeemed
and (ii) to register the transfer of or to exchange any Bank Notes  selected for
redemption, except the unredeemed portion of any Bank Note redeemed in part.

Persons Deemed Owners.  Prior to due presentment of a Bank Note for registration
or  transfer,  the Bank,  the Fiscal and Paying Agent and any other agent of the
Bank or the Fiscal and Paying Agent may treat the person in whose name such Bank
Note is  registered  as the owner of the Bank Note for the purpose of  receiving
payments  of  principal  and  interest,  if  any,  and for  all  other  purposes
whatsoever,  whether or not such Bank Note be  overdue,  and none of the Bank or
the Fiscal and Paying Agent or any agents thereof shall be affected by notice to
the contrary.

Cancellation  of Unissued Bank Notes.  Promptly upon the written  request of the
Bank,  the  Fiscal  and  Paying  Agent  shall  cancel and return to the Bank all
unissued Bank Notes so requested in its possession.

Mutilated,  Lost,  Stolen or Destroyed  Bank Notes.  The Fiscal and Paying Agent
shall obtain the replacement of mutilated,  lost, stolen or destroyed Bank Notes
in accordance with the custom and usage of the financial industry.


<PAGE>


                        THE FISCAL AND PAYING AGENTF THE

Payment of Bank Notes.  Payment of  principal,  premium (if any) and interest on
the Bank Notes  shall be made by the Fiscal and Paying  Agent to the  registered
holder of the Bank Notes in the manner  and on the dates  specified  in the Bank
Notes from immediately available funds deposited by the Bank with the Fiscal and
Paying Agent for such payments as provided in Section 3.3. The Fiscal and Paying
Agent shall have no  obligation to use its own funds for any such payment or for
any other purpose pursuant to this Agreement.

Information  Regarding  Amounts  Payable.  The Fiscal and Paying Agent shall, as
soon as  practicable  after each Record Date for the payment of interest  (other
than  interest  payable at maturity)  on any Bank Note,  but not later than five
days  preceding  the  related  Interest  Payment  Date,  notify  the Bank of the
interest to be paid on such Bank Note on the related  Interest  Payment Date. In
addition,  the Fiscal and Paying Agent shall (i) on or about the first  Business
Day of each month  furnish to the Bank a list  showing for each Bank Note issued
by the Bank  which  matures  in the next  succeeding  month  the  principal  and
interest  payable at maturity of such Bank Note (other than the  interest on any
Floating  Rate  Note with an  interest  rate  which  resets  after  such date of
delivery)  and (ii) notify the Bank of the  interest  payable at maturity of any
such  Floating  Rate  Note as soon  as  practicable  after  the  final  Interest
Determination Date (as defined in such Bank Note) for such Floating Rate Note.

Deposit of Funds.  The Bank shall deposit or cause to be deposited by 9:30 a.m.,
New York time,  with the Fiscal and Paying  Agent (i) on each  Interest  Payment
Date of a Bank Note an amount in immediately  available funds  sufficient to pay
the interest due on such date and (ii) on the Maturity Date or  Redemption  Date
(if any) of each such Bank Note (as such terms are defined in such Bank Note) an
amount in immediately  available  funds  sufficient to pay the principal of such
Bank Note, the premium due thereon (if any) and the interest  accrued thereon to
such Maturity Date or Redemption  Date (if any). The Bank will make such payment
on such Bank Notes by instructing  the Fiscal and Paying Agent to withdraw funds
from an account maintained by the Bank at the Fiscal and Paying Agent.

Money for Bank Note Payments to Be Held in Trust. Payments to Be Held in Trust

   Subject to the provisions of subsection (b) of this Section 3.4, all money
deposited with the Fiscal and Paying Agent pursuant to Section 3.3 shall be held
by it in trust for the benefit of the person or persons  entitled  thereto until
such money is paid to such person or persons in accordance  with the  provisions
of the Bank Notes and this Agreement or otherwise disposed of as provided herein
but such money need not be  segregated  from  other  funds  except to the extent
required by law.

   Any money deposited with the Fiscal and Paying Agent for the payment of the
principal  of,  premium  (if any) or  interest  on any Bank  Note  that  remains
unclaimed for two years after such  principal,  premium (if any) or interest has
become  due and  payable  shall  be  paid  to the  Bank  and  the  Holder  shall
thereafter,  as an unsecured general creditor, look only to the Bank for payment
thereof,  and all  liability of the Fiscal and Paying Agent with respect to such
money shall thereupon  cease. The provisions of this Section 3.4(b) shall be set
forth on the Bank Notes.

Additional  Responsibilities.  If the Bank shall ask the Fiscal and Paying Agent
to perform any duties not  specifically  set forth in this  Agreement  or in the
Additional  Agreements as duties of the Fiscal and Paying Agent (the "Additional
Responsibilities")  and the  Fiscal  and Paying  Agent  chooses to perform  such
Additional  Responsibilities,  the Fiscal and Paying  Agent shall be held to the
same  standard of care and shall be entitled  to all the  protective  provisions
(including, but not limited to, indemnification) set forth herein.

Miscellaneous.  Notwithstanding anything to the contrary herein or in the
Additional Agreements,

in paying Bank Notes hereunder, the Fiscal and Paying Agent shall be acting as a
conduit  and shall  not be paying  Bank  Notes for its own  account,  and in the
absence of written  notice from the Bank,  the Fiscal and Paying  Agent shall be
entitled to assume that any such Bank Note presented to it, or deemed  presented
to it, for payment, is entitled to be so paid;

the Fiscal and Paying Agent may become a purchaser, holder, transferor or may
otherwise  own, hold or transfer any  beneficial  interest in any Bank Notes and
may commence or join in any action  which a  beneficial  owner of a Bank Note is
entitled to take without any conflict with its responsibilities pursuant to this
Agreement;

the Fiscal and Paying Agent shall not be required to invest any moneys
delivered to it pursuant to this Agreement;

 the Fiscal and Paying Agent shall have no liability for interest on any moneys
received or held by it hereunder;

 the Fiscal and Paying Agent shall not be responsible for the correctness of any
recital  herein or in the Bank Notes or in any offering  materials  and makes no
representations  as to the  validity  of the  Bank  Notes  and  shall  incur  no
responsibility in respect thereto;

the Fiscal and Paying Agent shall be protected in acting upon any notice, order,
requisition, request, consent, certificate, order, opinion (including an opinion
of  counsel),  affidavit,  letter,  telegram  or other paper or document in good
faith  deemed by it to be genuine and correct and to have been signed or sent by
the proper person or persons; and

any action taken by the Fiscal and Paying Agent pursuant to this Agreement or
the Additional Agreements upon the request or authority or consent of any
person who at the time of making such  request or giving such  authority
or consent is the holder of any Bank Note shall be conclusive and binding upon 
all future holders of the same Bank Note and all Bank Notes issued in exchange
therefor or in place thereof.


                             CALCULATION OF INTEREST

Calculation  of  Floating  Interest.  The  Fiscal  and  Paying  Agent is  hereby
designated as calculation agent (in such capacity,  the "Calculation Agent") for
the purpose of calculating  the  Commercial  Paper Rate, the Fed Funds Rate, the
Prime Rate,  LIBOR,  the Treasury  Rate,  the J.J. Kenny Rate, the 11th District
Cost of Funds  Rate and the CMT Rate  all in  accordance  with the  terms of the
Floating  Rate Notes.  Such duties  shall be  "Additional  Responsibilities"  as
defined in Section 3.5 hereof.

Notice of Floating  Rate  Calculations.  As promptly as  practicable  after each
Interest Determination Date for a Floating Rate Note, the Calculation Agent will
notify the Bank of the  interest  rate which will become  effective  on the next
Interest Reset Date. Upon the request of the Holder of a Floating Rate Note, the
Calculation  Agent will provide to such Holder the interest  rate then in effect
and, if  determined,  the interest rate which will become  effective on the next
Interest Reset Date with respect to such Floating Rate Note.


                         LIABILITY AND INDEMNIFICATION
                                   

Liability.  The Fiscal and Paying Agent's  duties are  ministerial in nature and
the Fiscal and Paying Agent shall not have any liability  hereunder or under the
Additional   Agreements  except  in  the  case  of  its  negligence  or  willful
misconduct.  IN NO EVENT  SHALL THE FISCAL  AND  PAYING  AGENT BE LIABLE FOR ANY
SPECIAL,  INDIRECT,  INCIDENTAL,  PUNITIVE OR CONSEQUENTIAL DAMAGES, EVEN IF THE
FISCAL AND PAYING AGENT HAS BEEN  ADVISED OF THE  POSSIBILITY  OF SUCH  DAMAGES.
THIS  LIMITATION  OF  LIABILITY  WILL  APPLY  REGARDLESS  OF THE FORM OF ACTION,
INCLUDING  WITHOUT  LIMITATION,  BREACH  OF THIS  CONTRACT  OR  TORT  (INCLUDING
NEGLIGENCE).  The duties and obligations of the Fiscal and Paying Agent shall be
determined  by the  express  provisions  of this  Agreement  and it shall not be
liable  except  for  the  performance  of such  duties  and  obligations  as are
specifically  set forth herein and no implied  covenants shall be read into this
Agreement  against it. The Fiscal and Paying Agent shall have no  responsibility
in the case of any  default  by the  Bank in the  performance  of the  covenants
contained  in the Bank Notes.  The Fiscal and Paying Agent may refuse to perform
any duty or exercise any right or power hereunder  unless it receives  indemnity
satisfactory  to it against any related loss,  liability or expense.  The Fiscal
and Paying Agent shall not be required to ascertain whether any issuance or sale
of Bank Notes (or any amendment or termination of this  Agreement) has been duly
authorized or is in compliance  with any other  agreement to which the Bank is a
party  (whether or not the Fiscal and Paying Agent is also a party to such other
agreements).  Notwithstanding  anything to the contrary  herein,  the Fiscal and
Paying Agent shall not be  responsible  for any  misconduct or negligence on the
part of any agent,  correspondent,  attorney or receiver appointed with due care
by it hereunder.  The Fiscal and Paying Agent shall have no liability whatsoever
to any person or entity if any agent  fails to pay the Bank for any Bank Note in
whole or in part.

Indemnification.  The Bank agrees to indemnify  and hold harmless the Fiscal and
Paying Agent, its officers, directors, employees and agents from and against all
losses,  liabilities,  obligations,  claims,  damages, costs and expenses of any
kind or nature whatsoever (including, without limitation,  reasonable legal fees
and expenses)  relating to or arising out of its  performance  of the Fiscal and
Paying Agent's duties under this Agreement, except to the extent they are caused
by the negligence or willful  misconduct of the Fiscal and Paying Agent.  In the
event of the  resignation  or  removal  of the  Fiscal  and  Paying  Agent,  any
successor to the  performance of the  obligations of the Fiscal and Paying Agent
as specified in this Agreement shall be entitled to rely upon this indemnity and
neither  said  successor  nor the Bank or DTC shall be  entitled  to a  separate
indemnity from the Fiscal and Paying Agent.  These  indemnification  obligations
shall  survive  the   termination  of  this  Agreement  and  shall  survive  the
resignation or removal of the Fiscal and Paying Agent while remaining applicable
to any action  taken or omitted by the  Fiscal  and Paying  Agent  while  acting
pursuant to this Agreement and/or the Additional Agreements.


                      RESIGNATION OR REMOVAL OF FISCAL AND
                                  PAYING AGENT

Resignation or Removal.  The Fiscal and Paying Agent may at any time resign from
its  duties  hereunder  by  giving  written  notice of  resignation  to the Bank
specifying the date on which such resignation shall become effective;  provided,
however,  that such date  shall not be less than ten  Business  Days  after such
notice is given to the Bank.  The Bank may at any time  terminate this Agreement
by giving  written  notice of such  termination  to the Fiscal and Paying  Agent
specifying  the date on which such  termination  shall be  effective;  provided,
however,  that such date  shall be not less than ten  Business  Days  after such
notice is given to the Fiscal and Paying Agent.  Any  termination or resignation
hereunder shall not affect the Fiscal and Paying Agent's right to the payment of
fees earned or charges  incurred  through the effective date of such termination
or resignation, as the case may be.

Successor  Fiscal and Paying Agent.  Upon the effective date of such resignation
or termination, the Fiscal and Paying Agent shall deliver any money then held by
it pursuant to Section 3.4(a) to the successor appointed by the Bank to serve as
Fiscal and Paying Agent for the Bank Notes and all liability of the  predecessor
Fiscal and Paying Agent with respect to such money shall  thereupon  cease.  The
Fiscal and Paying  Agent shall also provide  such  successor  with a copy of its
records relating to the Bank Notes as such successor shall  reasonably  request.
However,  the Fiscal and Paying  Agent  shall not be  required  to deliver  such
materials  to any location  outside the United  States of America and may retain
copies of any records turned over for archival  purposes.  If such successor has
not been appointed by the effective date of such resignation or termination, the
Fiscal and Paying  Agent  shall pay such money and deliver  such  records to the
Bank with the same effect as though such payment  were made  pursuant to Section
3.4(b). The delivery,  transfer and assignment of such moneys and records by the
Fiscal and Paying Agent to its  successor or the Bank, as the case may be, shall
be sufficient,  without the requirement of any additional act or the requirement
of any  indemnity  to be given by the Fiscal and Paying  Agent,  to relieve  the
Fiscal and Paying  Agent of all further  responsibility  for the exercise of the
rights or the  performance  of the  obligations  vested in the Fiscal and Paying
Agent pursuant to this Agreement.

Successor by Merger,  etc. Any corporation or association  into which the Fiscal
and  Paying  Agent  may  be  converted  or  merged,  or  with  which  it  may be
consolidated,  or  to  which  it  may  sell  or  transfer  its  debt  securities
administration  business as a whole, or any corporation or association resulting
from any such conversion, sale, merger, consolidation or transfer to which it is
a party,  shall be and become  successor  Fiscal and Paying Agent  hereunder and
shall be invested with all of the rights, powers, trusts, duties and obligations
of the Fiscal and Paying Agent hereunder, without the execution or filing of any
instrument or any further act. The Fiscal and Paying Agent shall provide  notice
to the Bank of any such conversion,  merger, consolidation,  sale or transfer as
soon as  practicable  after the Fiscal and Paying Agent obtains  knowledge  that
such event will occur or has occurred.


                                  MISCELLANEOUS

Compensation  of the Fiscal and Paying Agent.  The Bank agrees to pay the Fiscal
and Paying Agent compensation for all services rendered by the Fiscal and Paying
Agent  hereunder  to the Bank in such  amounts  and payable at such times as the
Bank and the Fiscal and Paying Agent may agree to and to promptly  reimburse the
Fiscal and Paying Agent for all  reasonable  out-of-pocket  expenses  (including
counsel  fees),  disbursements  and advances  incurred or made by the Fiscal and
Paying Agent in the performance of its duties hereunder and under the Additional
Agreements.  The  obligation  of the Bank  pursuant  to this  Section  7.1 shall
survive the termination of this Agreement, including any termination pursuant to
any federal or state bankruptcy law, to the extent  enforceable under applicable
law.

Reliance  on  Opinions  of  Counsel.  The Fiscal and Paying  Agent shall have no
liability to the Bank in respect of an action taken or omitted by the Fiscal and
Paying Agent in good faith in reliance on an opinion of its  counsel,  including
in-house counsel.

Notes Held by Fiscal  and Paying  Agent.  The  Fiscal and Paying  Agent,  in its
individual or other capacity, may become the owner or pledgee of Bank Notes with
the same  rights it would have if it were not acting as fiscal and paying  agent
hereunder.

Notices.  Notices and other communications hereunder shall (except to the extent
otherwise  expressly  provided) be in writing or given via electronic  media and
shall be addressed as follows,  or to such other addresses as the parties hereto
shall specify from time to time.

If to the Bank:            500 East Main Street
                           Bowling Green, Kentucky  42101

                           Attention:      Dean P. Jordan

                           Telephone:      (502)793-7712
                           Telecopy:       (502)793-7754


If to the Fiscal
         and Paying Agent: First Fidelity Bank, N.A.
                           123 South Street
                           Corporate Trust Administration
                           Philadelphia, Pennsylvania  19109


                           Attention:    John Clapham

                           Telephone:    (215)985-7202
                           Telecopy:     (215)985-7290

All notices shall be deemed given when received.

                    Provision of Amendments to Documentation. The Bank agrees to
provide the Fiscal and Paying Agent with any amendments to the Offering Circular
or Administrative Procedures.

Parties.  Except for rights  arising under  Section  3.4(a),  this  Agreement is
solely for the benefit of the parties  hereto and their  successors  and assigns
and  nothing  herein,  express  or  implied,  shall  give  to any  other  person
including, without limitation, any direct or beneficial owner of Bank Notes, any
benefits or any legal or equitable right, remedy or claim under this Agreement.

Governing  Law.  THIS  AGREEMENT AND THE RIGHTS AND  OBLIGATIONS  OF THE PARTIES
HERETO  SHALL BE GOVERNED BY AND  CONSTRUED IN  ACCORDANCE  WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT GIVING EFFECT TO ITS CONFLICT OF LAW PRINCIPLES.

Separability.  In case any provision in this Agreement shall be invalid, illegal
or  unenforceable,  the validity,  legality and  enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

Effect of Headings.  The table of contents and the article and section  headings
herein  are  for  convenience  of  reference  only  and  shall  not  affect  the
construction hereof.

Defined Terms. Terms defined in the administrative procedures attached hereto as
Exhibit D and used  herein  are as  therein  defined  unless  otherwise  defined
herein.

Amendments, Modifications. No amendment or modification of any provision of this
Agreement or any Additional  Agreement shall be effective  unless the same shall
be in writing and signed by all the parties hereto or thereto as applicable. Any
such amendment or modification  shall be effective only in the specific instance
and for the purpose for which given.

Laws of Other  Jurisdictions.  The  Fiscal and  Paying  Agent  shall be under no
obligation  to keep  itself  apprised  of or comply with any laws other than the
laws of the State of New York and the federal laws of the United States.  To the
extent  that  the Bank  requires  that the  laws of any  other  jurisdiction  be
complied  with,  the Fiscal and  Paying  Agent  shall rely on, and in so relying
shall be held  harmless  by,  the Bank as to the  requirements  of such laws and
shall not be  required  to make any  independent  investigation  of such laws or
their requirements.

Actions Due on Saturdays,  Sundays and Holidays. If any date on which a payment,
notice or other action  required by this Agreement or any  Additional  Agreement
falls on other  than a Business  Day,  then that  action or payment  need not be
taken or made on such  date,  but may be  taken  or made on the next  succeeding
Business Day on which the Fiscal and Paying Agent is open for business  with the
same force and effect as if made on such date.

Agreement to Pay Attorneys' Fees and Other Expenses. In the event the Bank shall
default under any of the  provisions  of this  Agreement  and/or any  Additional
Agreement  affecting the rights or duties of the Fiscal and Paying Agent and the
Fiscal and Paying Agent shall employ  attorneys or incur other  expenses for the
enforcement of  performance  or observance of any such  obligation or agreement,
the Bank  agrees  that it will on demand  therefor  pay to the Fiscal and Paying
Agent the reasonable fees of such attorneys and such other expenses  incurred by
the Fiscal and Paying Agent.

Survival.  The Fiscal and Paying Agent's rights to compensation, reimbursement
and indemnification shall survive the termination of this Agreement 
and any Additional Agreements.

Force  Majeure.  The Fiscal and Paying Agent shall not be liable for any failure
or delays arising out of conditions beyond its reasonable control including, but
not limited to, work stoppages,  fires, civil disobedience,  riots,  rebellions,
storms, electrical,  mechanical, computer or communications facilities failures,
acts of God and similar occurrences.

Remedies.  Unless  otherwise  specified  herein,  in the event that either party
breaches or violates any of the  obligations  contained in this  Agreement,  the
other  party  shall be  entitled  to  exercise  any  right  and seek any  remedy
available  to it  either  at law or in  equity,  including  without  limitation,
damages and injunctive  relief;  the exercise of any right or the seeking of any
remedy shall not preclude the  concurrent  or  subsequent  exercise of any other
right or the seeking of any other remedy,  and all rights and remedies  shall be
cumulative.

And/Or.  The term "or" shall include the conjugate  form so that each use of the
term "or" should be interpreted as "and/or".

No Implied Waivers. The right of any party under any provision of this Agreement
shall not be affected by its prior  failure to require  the  performance  by any
other party under such provision or any other provision of this  Agreement,  nor
shall the waiver by any party of a breach of any provision  hereof  constitute a
waiver of any succeeding breach of the same or any other provision or constitute
a waiver of the provision itself or any other provision.

Counterparts.  This  Agreement  may be executed in  counterparts,  each of which
shall  constitute  an original  but both or all of which,  when taken  together,
shall  constitute  but one  instrument,  and shall become  effective when copies
hereof which,  when taken  together,  bear the signatures of each of the parties
hereto, shall be delivered to each of the parties hereto.

Term.  This Agreement shall remain in full force and effect until the earlier to
occur of (i) such time as the principal of and premium,  if any, and interest on
all the  Bank  Notes  shall  have  been  paid,  (ii) the  effective  date of the
resignation  or  termination  of the  Fiscal  and  Paying  Agent,  and (iii) the
effective  date  of  DTC's   resignation  if  the  Bank  appoints  no  successor
depository.

Times.  All times referred to herein shall be the time in effect in New York,
New York.

                                 Funds Transfer

                    Should  the  Fiscal  and  Paying  Agent be  required  in the
performance of the Agreement to make any funds transfer (as that term is defined
in Article 4A of the Uniform  Commercial Code as in effect in New York ("Article
4A")) for or at the request of the Bank, the following shall apply:

                    Other than to verify an  instruction  to  transfer  funds (a
"payment  order") received by the Bank pursuant to the Fiscal and Paying Agent's
security  procedures,  the Fiscal and Paying Agent shall not be  responsible  to
investigate any errors or inconsistencies in any payment order.

If by reason of the use of an identifying number provided to the Fiscal
and Paying Agent by the Bank, a party  other than the  beneficiary  of the
Bank's  payment order is paid or funds are  transferred to a bank other than
the one intended by the Bank to receive such payment order,  either as the
beneficiary's  bank or an intermediary  bank to be used in connection  with
such transfer,  the Bank shall remain  liable to pay such payment
order so long as the Fiscal and Paying Agent
shall have properly transmitted the identifying number provided.

                              The Bank shall promptly notify the Fiscal and 
Paying Agent of any discrepancies, unauthorized  or erroneous  transactions or
other errors relating to any payment orders  issued by the Bank once such
payment orders have been confirmed to the Bank by the Fiscal and Paying Agent.

 The Bank may issue instructions to the Fiscal and Paying Agent to cancel
or amend any payment order issued pursuant to this Agreement. The Fiscal and
Paying Agent agrees to act upon such  instructions so long as
(i) the Fiscal and Paying Agent has received such instructions
prior to the execution of such payment order and
in  sufficient  time to permit  it to take the  action  called  for and (ii) the
authenticity of such instructions to amend or cancel is verified pursuant to the
security procedures. The Fiscal and Paying Agent reserves the right at any time,
and from time to time,  when requested to amend a payment order,  to cancel such
payment  order  and to  require  the Bank to submit a new  payment  order to the
Fiscal and Paying Agent. Should any cancellation or amendment of a payment order
be received by the Fiscal and Paying  Agent after the  execution  of such order,
the Fiscal and Paying Agent shall take such reasonable steps as are available to
it to amend,  recall,  reverse or revoke such payment order, but it shall not be
liable for any failure to achieve the amendment,  recall, reversal or revocation
thereof.  Should the Fiscal and Paying  Agent elect to cancel or amend a payment
order, it may require an indemnity and bond or security acceptable to it.

If any payment order is transmitted through any funds transfer system,
including, but not limited to, the Clearing House Interbank payment System
("CHIPS") or the Automated Clearing House System (the "ACH system"),
the Bank shall be subject to the rules of such funds  transfer  system in 
effect at the time such transfer is made.  If the Bank  receives  any credit 
entries  through the ACH system,  such credit may be reversed by the Fiscal
and Paying Agent if final  settlement  does not occur.

Should the Fiscal and Paying Agent be negligent or engage in willful misconduct
and be required to pay the Bank interest in connection with a payment order 
(whether the Bank is the  originator  or the  beneficiary  of such order), 
such interest shall be computed based on the Rules on Interbank  Compensation 
of The New York Clearing House Association (the "Compensation  Rules") as in
effect from time to time for all  circumstances  to which  such  Compensation
Rules  apply.  In any circumstance  not  subject  to such  Compensation  Rules,
the rate  shall be as provided in Article 4A.

In executing any payment order, the Fiscal and Paying Agent may use the 
services of correspondent or intermediary banks,  funds-transfer systems, 
telecommunication companies  and other  entities of similar  purpose.
While the Fiscal and Paying Agent shall use due care in the selection of all
such entities, they are not the Fiscal and  Paying  Agent's  agents and the
Fiscal and Paying  Agent will not be
responsible for their acts or omissions with regard to any payment orders.

  The Bank agrees to be bound by any forthcoming reasonable standard terms and
conditions of the Fiscal and Paying Agent concerning funds transfers. The Fiscal
and Paying  Agent will send these  terms and  conditions  to the Bank as soon as
they become  finalized.  These terms and  conditions  will be applicable to this
Agreement.


<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on their behalf by representatives duly authorized thereunto, all as of
the day and year first above written.

                                            FIRST FIDELITY BANK, N.A.,
                                              as Fiscal and Paying Agent


                                            By:
                                            Title:


                                      TRANS FINANCIAL BANK, NATIONAL ASSOCIATION


                                            By:
                                            Title:






<PAGE>


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                                                  TABLE OF CONTENTS


                                                                            Page

     ARTICLE I
                                                     APPOINTMENT
     Section 1.1  Appointment of Fiscal and Paying Agent....................  1

     ARTICLE II
                                                   THE BANK NOTES
     Section 2.1  Form of Bank Notes..........................................1
     Section 2.2  Certificates of Authorized Representatives of the Bank......2
     Section 2.3  Completion, Authentication and Delivery.....................2
     Section 2.4  Denominations.............................................. 4
     Section 2.5  Proceeds of Sale of the Bank Notes; Resignation by DTC..... 4
     Section 2.6  Registration, Registration of Transfer and Exchange........ 4
     Section 2.7  Persons Deemed Owners...................................... 5
     Section 2.8  Cancellation of Unissued Bank Notes........................ 5
     Section 2.9  Mutilated, Lost, Stolen or Destroyed Bank Notes............ 5

     ARTICLE III
                                             THE FISCAL AND PAYING AGENT
     Section 3.1  Payment of Bank Notes...................................... 6
     Section 3.2  Information Regarding Amounts Payable...................... 6
     Section 3.3  Deposit of Funds........................................... 6
     Section 3.4  Money for Bank Note Payments to Be Held in Trust........... 6
     Section 3.5  Additional Responsibilities................................ 7
     Section 3.6  Miscellaneous.............................................. 7

     ARTICLE IV
                                               CALCULATION OF INTEREST
     Section 4.1  Calculation of Floating Interest........................... 8
     Section 4.2  Notice of Floating Rate Calculations....................... 8

     ARTICLE V
                                            LIABILITY AND INDEMNIFICATION
     Section 5.1  Liability.................................................. 8
     Section 5.2  Indemnification............................................ 9

     ARTICLE VI
                                ESIGNATION OR REMOVAL OF FISCAL AND PAYING AGENT
     Section 6.1  Resignation or Removal..................................... 9
     Section 6.2  Successor Fiscal and Paying Agent..........................10
     Section 6.3  Successor by Merger, etc...................................10

     ARTICLE VII
                                                    MISCELLANEOUS
     Section 7.1  Compensation of the Fiscal and Paying Agent............... 10
     Section 7.2  Reliance on Opinions of Counsel............................11
     Section 7.3  Notes Held by Fiscal and Paying Agent......................11
     Section 7.4  Notices....................................................11
     Section 7.5  Parties....................................................11
     Section 7.6  Governing Law..............................................12
     Section 7.7  Separability...............................................12
     Section 7.8  Effect of Headings.........................................12
     Section 7.9  Defined Terms..............................................12
     Section 7.10 Amendments, Modifications................................  12
     Section 7.11 Laws of Other Jurisdictions................................12
     Section 7.12 Actions Due on Saturdays, Sundays and Holidays.............12
     Section 7.13 Agreement to Agent Attorneys' Fees and Other Expenses......12
     Section 7.14 Survival...................................................13
     Section 7.15 Force Majeure..............................................13
     Section 7.16 Remedies...................................................13
     Section 7.17 And/Or.....................................................13
     Section 7.18 No Implied Waivers.........................................13
     Section 7.19 Counterparts...............................................13
     Section 7.20 Term.......................................................13
     Section 7.21 Times......................................................13
     Section 7.22 Funds Transfer.............................................14



<PAGE>


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81



                                                      EXHIBITS


Exhibit A-1   Form of Global Bank Note representing Short-Term Fixed Rate Notes

Exhibit A-2   Form of Global Bank Note representing Medium-Term Fixed Rate Notes

Exhibit B-1   Form of Global Bank Note representing Short-Term Floating Rate
              Notes

Exhibit B-2   Form of Global Bank Note representing Medium-Term Floating Rate
              Notes

Exhibit C     Bank Certificate of Authorized Representatives

Exhibit D     Administrative Procedures



<PAGE>


                                 EXHIBIT A-1 TO
                                FISCAL AND PAYING
                                AGENCY AGREEMENT
                               (Short-Term Fixed)

UNLESS AND UNTIL IT IS EXCHANGED  IN WHOLE OR IN PART FOR NOTES IN  CERTIFICATED
FORM THIS NOTE MAY NOT BE  TRANSFERRED  EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER  NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR  DEPOSITARY  OR A NOMINEE OF SUCH  SUCCESSOR  DEPOSITARY.  UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY  (55 WATER  STREET,  NEW YORK,  NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE  NAME OF CEDE & CO.  OR  SUCH  OTHER  NAME  AS  REQUESTED  BY AN  AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO.,  ANY  TRANSFER,  PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL  SINCE THE REGISTERED  HOLDER HEREOF,  CEDE & CO., HAS AN
INTEREST HEREIN.

THIS BANK NOTE IS A DIRECT, UNCONDITIONAL,  UNSECURED AND UNSUBORDINATED GENERAL
OBLIGATION OF THE BANK.  THE  OBLIGATION  EVIDENCED BY THIS BANK NOTE RANKS PARI
PASSU  WITH ALL OTHER  UNSECURED  AND  UNSUBORDINATED  OBLIGATIONS  OF THE BANK,
EXCEPT  OBLIGATIONS  THAT ARE SUBJECT TO ANY  PRIORITIES  OR  PREFERENCES  UNDER
APPLICABLE LAW, INCLUDING DEPOSIT OBLIGATIONS.

THIS BANK NOTE DOES NOT  EVIDENCE A DEPOSIT  AND IS NOT  INSURED BY THE  FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR OTHER INSURER.

REGISTERED                                                REGISTERED
NO. FX _______________

CUSIP ________________


                                 FIXED RATE NOTE

                   TRANS FINANCIAL BANK, NATIONAL ASSOCIATION


ORIGINAL ISSUE DATE:                        INTEREST RATE:

STATED MATURITY:                    NUMBER OF DAYS:

REPAYMENT DATE(S):                          REDEMPTION DATES:

REPAYMENT PRICE:                    REDEMPTION PRICE:

OTHER REPAYMENT TERMS:              OTHER REDEMPTION TERMS:

ORIGINAL ISSUE DISCOUNT NOTE:          TOTAL AMOUNT OF OID:           
ISSUE PRICE (expressed as a percentage of
             aggregate principal amount):
----

----
----
 Yes      No
-------------------------------------
-----------------

-----------------
-----------------
      2
YIELD TO MATURITY:  SHORT ACCRUAL PERIOD OID:  METHOD USED TO DETERMINE YIELD
                                               FOR SHORT
                                               ACCRUAL PERIOD:
                                                                --

                                                                --
                                                                --
                                                        Approximate      Exact
                                                  ----------------------------
                                                  ------------------------

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

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


Trans Financial Bank, National  Association (the "Bank", which term includes any
successor  thereof)  for  value  received,  hereby  promises  to pay  the sum of
_______________  U.S. dollars ($_______) to CEDE & CO. (the "Registered Holder")
as the  nominee  of The  Depository  Trust  Company  ("DTC")  as  custodian  for
participants  each acting for themselves and as nominee or custodian for others,
including  trusts,  pension  and  retirement  plans and  accounts,  fiduciaries,
custodians and nominees (the  "Participants")  on the Stated Maturity and to pay
interest on the Stated Maturity.

Interest on this Note shall accrue from and  including  the Original  Issue Date
specified herein, to but excluding the Stated Maturity  specified herein, at the
per annum rate shown herein calculated on the basis of the actual number of days
elapsed  divided by a 360-day year.  Interest shall be payable in arrears on the
Stated Maturity. If the Stated Maturity does not fall on a Business Day, payment
of interest and  principal  due on the Stated  Maturity will be made on the next
succeeding  Business Day with the same force and effect as if made on the Stated
Maturity,  and no  interest  shall be payable  on the amount so payable  for the
period from and after such Stated Maturity.  Interest and principal on this Note
shall be paid by the Bank at  Maturity  to the person in whose name this Note is
registered at the opening of business on the Stated Maturity.

For purposes of this Note,  "Business  Day" means any day that is not a Saturday
or Sunday and that is not a day on which banking  institutions are authorized or
obligated by law or executive  order to close in the City of New York,  New York
and the City of Bowling Green, Kentucky. Principal and interest on Notes will be
made in immediately available funds to the Registered Holder.

The Registered  Holder may declare the principal amount of, and accrued interest
on,  this Note to be due and  payable  immediately  if an Event of Default  with
respect to this Note shall have  occurred and be  continuing at the time of such
declaration. Any Event of Default with respect to this Note may be waived by the
Registered Holder.

For  purposes  of this  Note,  an "Event of  Default"  shall mean any one of the
following events:

                  default in the payment of any  interest  upon the Note when it
                  becomes due and payable, and continuance of such default for a
                  period of 30 days; or

                            default in the payment of the principal of (or 
                  premium, if any, on) the Note when due; or

                            default  in  the  performance  of  any  covenant  or
                  agreement of the Bank  contained  in the Note which  continues
                  for 60 days  after  receipt  of  written  notice  given by the
                  Registered Holder hereof; or

                            the  Bank  shall  consent  to the  appointment  of a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar official in any insolvency, receivership, liquidation,
                  readjustment of debt,  marshaling of assets and liabilities or
                  similar  proceedings  of or  relating  to  the  Bank  or of or
                  relating to all or  substantially  all of its  property;  or a
                  decree or order of a court or agency or supervisory  authority
                  having  jurisdiction  in the premises for the appointment of a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar official in any insolvency, receivership, liquidation,
                  readjustment of debt,  marshaling of assets and liabilities or
                  similar  proceedings,  or for the winding-up or liquidation of
                  its affairs, shall have been entered against the Bank and such
                  decree or order shall have remained in force  undischarged  or
                  unstayed  for a period  of 60  consecutive  days;  or the Bank
                  shall  file a petition  to take  advantage  of any  applicable
                  insolvency or reorganization statute.


All notices to the Bank under this Note shall be in writing or  addressed to the
Fiscal  and   Paying   Agent  at  [insert   name  and   address]  ;   Attention:
______________________,  or to such  other  address  as the Bank may  notify the
Registered Holder.

This Note shall be governed by and construed in accordance  with the laws of the
State of New York.

No interest will accrue on this Note after its maturity.

The Notes of this Series are issuable only in registered  form without  interest
coupons in denominations of $250,000 and integral  multiples of $1,000 in excess
thereof.

This Note may be subject to  repayment  at the option of the  Registered  Holder
hereof on the Repayment Date(s) indicated on the face hereof. If no such date is
set forth on the face  hereof,  this Note may not be so repaid at the  option of
the Registered Holder hereof prior to maturity.  On each Repayment Date, if any,
this  Note  shall  be  repayable  in whole or in part in  increments  of  $1,000
(provided that any remaining principal hereof shall be at least $500,000) at the
option of the Registered Holder hereof at a repayment price equal to 100% of the
principal  amount to be repaid,  or if this Note is an Original  Issue  Discount
Note (as specified on the face hereof), the applicable Repayment Price specified
on the face hereof  together  in the case of any such  repayment  with  interest
thereon  payable to the Repayment Date, but interest  installments  due prior to
the  Repayment  Date will be payable to the  Registered  Holder on the  relevant
special  record  date.  For this  Note to be  repaid  in whole or in part at the
option of the Registered  Holder hereof,  _____________________________________,
as Fiscal and Paying Agent, at [insert address]; Attention: _______________ , or
at such  other  address  of which the Bank  shall  from time to time  notify the
Registered Holder of the Notes, must receive not more than 45, nor less than 30,
days prior to a Repayment Date, if any, either (i) this Note  accompanied by the
form  entitled  "Option  to Elect  Repayment"  below duly  completed,  or (ii) a
telegram,  telex,  facsimile  transmission or letter from a member of a national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial  bank or trust company in the United States of America  setting forth
the name of the  Registered  Holder,  the  principal  amount of this  Note,  the
principal  amount  of this  Note  to be  repaid,  the  certificate  number  or a
description  of the tenor and terms of the Note, a statement  that the option to
elect repayment is being  exercised  thereby and a guarantee that the Note to be
repaid  with the form  entitled  "Option  to Elect  Repayment"  on the Note duly
completed  will be received  by the Fiscal and Paying  Agent not later than five
Business Days after the date of such telegram,  telex, facsimile transmission or
letter  and such Note and form duly  completed  are  received  by the Fiscal and
Paying Agent by such fifth Business Day.  Exercise of such  repayment  option by
the Registered  Holder hereof shall be irrevocable,  except a Registered  Holder
tendering after receipt of a notice of an extension of maturity.

If so provided  on the face of this Note,  this Note may be redeemed by the Bank
on any Redemption  Date (or range of Redemption  Dates) so indicated on the face
hereof. If no Redemption Date (or range of Redemption Dates) is set forth on the
face hereof, this Note may not be redeemed prior to its Stated Maturity.  If one
or more Redemption Dates (or ranges of Redemption Dates) are so specified,  this
Note is  subject  to  redemption  at the  option  of the  Bank,  upon  notice by
first-class mail, not less than 30 nor more than 45 days prior to the Redemption
Date specified in such notice,  at the applicable  redemption price specified on
the face hereof (expressed as a percentage of the principal amount of this Note)
together  in the  case of any  such  redemption  with  accrued  interest  to the
Redemption  Date.  The Bank may elect to redeem  less than the entire  principal
amount hereof;  provided,  that the principal  amount, if any, of this Note that
remains outstanding after such redemption is an Authorized Denomination.  In the
event of any  redemption  in part,  the Bank will not be  required to (i) issue,
register the transfer of, or exchange any Note during a period  beginning at the
opening  of  business  15 days  before  the day of the  mailing of the notice of
redemption of Notes  selected for redemption and ending at the close of business
on the date of mailing of the relevant notice of redemption or (ii) register the
transfer or exchange of any Note, or any portion thereof, called for redemption,
except the unredeemed portion of any Note being redeemed in part.

Any money  deposited  with the Fiscal and  Paying  Agent for the  payment of the
principal of,  premium (if any) or interest on this Note that remains  unclaimed
for two years after such principal,  premium (if any) or interest has become due
and payable  shall be paid to the Bank and the Holder  shall  thereafter,  as an
unsecured general creditor,  look only to the Bank for payment thereof,  and all
liability  of the  Fiscal  and Paying  Agent  with  respect to such money  shall
thereupon  cease. IN WITNESS  WHEREOF,  the Bank has caused this Note to be duly
executed and countersigned as of the date set forth herein.

This Note is not valid for any  purpose  until  countersigned  by the Fiscal and
Paying Agent or such other  institution  as may be appointed by the Bank and the
certificate of authentication affixed hereon.


Countersigned for                                    By Trans Financial Bank,
                                                        National Association
  authentication only

  as Fiscal and Paying Agent

By______________________________            __________________________
         Authorized Signature                           Authorized Signature



                                                              Attest:

                                                              -----------------
                                                              Secretary


<PAGE>


                                              OPTION TO ELECT REPAYMENT

The  undersigned  hereby  irrevocably  request (s) and  instruct (s) the Bank to
repay the within Note (or portion thereof specified below) pursuant to its terms
at a price equal to the principal amount thereof,  together with interest to the
repayment date, to the undersigned, at


(Please print or typewrite name and address of the Undersigned)

For this Note to be repaid the Fiscal and Paying  Agent must  receive at [insert
name and address]; Attention:  _______________, or at such other place or places
of which the  Company  shall  from time to time  notify the Holder of the within
Note,  not more than 45, nor less than 30,  days prior to a Repayment  Date,  if
any,  shown on the face of the  within  Note,  either  (i) this  Note  with this
"Option to Elect  Repayment"  form duly  completed,  or (ii) a telegram,  telex,
facsimile transmission or letter from a member of a national securities exchange
or the National Association of Securities Dealers,  Inc. or a commercial bank or
trust  company in the United  States of  America  setting  forth the name of the
Registered  Holder of the Note, the principal  amount of the Note, the principal
amount of the Note to be repaid,  the certificate number or a description of the
tenor and terms of the Note, a statement  that the option to elect  repayment is
being exercised thereby and a guarantee that the Note to be repaid with the form
entitled  "Option to Elect  Repayment"  duly  completed  will be received by the
Fiscal and Paying Agent not later than five Business Days after the date of such
telegram,  telex,  facsimile  transmission or letter and such Note and form duly
completed  are  received by the Fiscal and Paying  Agent by such fifth  Business
Day.

If less than the entire  principal  amount of the  within  Note is to be repaid,
specify the portion  thereof  (which shall be  increments  of $1,000)  which the
Holder  elects to have  repaid:  $________;  and  specify  the  denomination  or
denominations  (which  shall be $500,000  or an  integral  multiple of $1,000 in
excess of  $500,000)  of the Notes to be issued to the Holder for the portion of
the within Note not being repaid (in the absence of any such specification,  one
such Note will be issued for the portion not being repaid): $________.

Date:_______________                        ____________________________________
                                                     Note: The signature on this
                                                     Option  to Elect  Repayment
                                                     must  correspond  with  the
                                                     name as  written  upon  the
                                                     face of this  Note in every
                                                     particular          without
                                                     alteration or enlargement.


<PAGE>


                                           ------------------------------
                                                    ABBREVIATIONS


The following  abbreviations,  when used in the  inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

                  TEN COM -- as tenants in common

                  TEN ENT -- as tenants by the entireties

                  JT ENT  -- as joint tenants and not as tenants in common
                                                                      Custodian
                  UNIF GIFT MIN ACT --
 ................................................................................
                                                  (Cust)                 (Minor)
                                               under Uniform Gift to Minors Act

 .............................................................................
                                                              (State)

Additional abbreviations may be used though not in the above list.



FOR VALUE  RECEIVED the  undersigned  hereby sells,  assigns and transfers  unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE


(Name and address of assignee, including zip code, must be printed or
 typewritten)


the within Note, and all rights thereunder, hereby irrevocably constituting 
and appointing


to  transfer  said Note on the books of the within  Company,  with full power of
substitution in the premises.

Dated:


NOTICE:  The  signature  to this  assignment  must  correspond  with the name as
written upon the face of the within Note in every particular, without alteration
or  enlargement  or any change  whatever and must be  guaranteed by an "eligible
guarantor  institution" meeting the requirements of the Fiscal and Paying Agent,
which  requirements  include  membership or participation in STAMP or such other
"signature guaranty program" as may be determined by the Fiscal and Paying Agent
in  addition  to or in  substitution  for  STAMP,  all in  accordance  with  the
Securities Exchange Act of 1934, as amended.


<PAGE>


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







                                                        

                                 EXHIBIT A-2 TO
                                FISCAL AND PAYING
                                AGENCY AGREEMENT
                               (Medium-Term Fixed)

UNLESS AND UNTIL IT IS EXCHANGED  IN WHOLE OR IN PART FOR NOTES IN  CERTIFICATED
FORM THIS NOTE MAY NOT BE  TRANSFERRED  EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER  NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR  DEPOSITARY  OR A NOMINEE OF SUCH  SUCCESSOR  DEPOSITARY.  UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY  (55 WATER  STREET,  NEW YORK,  NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE  NAME OF CEDE & CO.  OR  SUCH  OTHER  NAME  AS  REQUESTED  BY AN  AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO.,  ANY  TRANSFER,  PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL  SINCE THE REGISTERED  HOLDER HEREOF,  CEDE & CO., HAS AN
INTEREST HEREIN.

[Senior Bank Note:  THIS BANK NOTE IS A DIRECT, UNCONDITIONAL, UNSECURED AND
UNSUBORDINATED GENERAL OBLIGATION OF
THE BANK.  THE OBLIGATION EVIDENCED BY THIS BANK NOTE RANKS PARI PASSU WITH
ALL OTHER UNSECURED AND
UNSUBORDINATED OBLIGATIONS OF THE BANK, EXCEPT OBLIGATIONS THAT ARE SUBJECT TO
ANY PRIORITIES OR PREFERENCES
UNDER APPLICABLE LAW, INCLUDING DEPOSIT OBLIGATIONS.]

[Subordinated Bank Note: "THE OBLIGATION EVIDENCED BY THIS BANK NOTE IS
UNSECURED AND IS SUBORDINATED AND JUNIOR
IN RIGHT OF PAYMENT TO THE BANK'S OBLIGATIONS TO ITS DEPOSITORS AND TO THE 
BANK'S OTHER OBLIGATIONS TO ITS
GENERAL AND SECURED CREDITORS AND IS INELIGIBLE AS COLLATERAL TO SECURE A 
LOAN FROM THE BANK.]

THIS BANK NOTE DOES NOT  EVIDENCE A DEPOSIT  AND IS NOT  INSURED BY THE  FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER INSURER.

REGISTERED                                                         REGISTERED
NO. FX _______________
CUSIP ________________

                                                   FIXED RATE NOTE
                                     TRANS FINANCIAL BANK, NATIONAL ASSOCIATION

ORIGINAL ISSUE DATE:                                 INTEREST RATE:

STATED MATURITY:                            REGULAR RECORD DATES:

REDEMPTION DATES:                           INTEREST PAYMENT DATES:

REDEMPTION PRICE:                           INTEREST ACCRUAL DATE:

OTHER REDEMPTION TERMS:                     REPAYMENT DATE(S):

OTHER TERMS:                                         REPAYMENT PRICE:

                             OTHER REPAYMENT TERMS:

If this Note was issued with "original  issue  discount" for purposes of Section
1273 of the Internal  Revenue Code of 1986, as amended,  the following  shall be
completed:

ORIGINAL ISSUE DISCOUNT NOTE:   TOTAL AMOUNT OF OID:     ISSUE PRICE 
                                                    (expressed as a percentage
                                                       of
                                                    aggregate principal amount):
----

----
----
 Yes     No
-------------------------------------
--------------------

--------------------
--------------------
      6
YIELD TO MATURITY:      SHORT ACCRUAL PERIOD OID:      METHOD USED TO DETERMINE
                                                       YIELD FOR SHORT
                                                       ACCRUAL PERIOD:
                                                        --

                                                        --
                                                        --
                                                          Approximate   Exact
                                                       -------------------------
                                                       -------------------------

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

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

Trans Financial Bank, National  Association (the "Bank", which term includes any
successor  thereof)  for  value  received,  hereby  promises  to pay  the sum of
_________  U.S.  dollars  ($_______________)  to  CEDE  & CO.  (the  "Registered
Holder") as the nominee of The Depository Trust Company ("DTC") as custodian for
participants  each acting for themselves and as nominee or custodian for others,
including  trusts,  pension  and  retirement  plans and  accounts,  fiduciaries,
custodians and nominees (the  "Participants")  on the Stated Maturity and to pay
interest on a regular periodic basis as specified herein.

Interest on this Note shall accrue from and including  the most recent  Interest
Payment Date specified herein to which interest has been paid or, if no interest
has been  paid on this  Note,  from  and  including,  the  Original  Issue  Date
specified herein, to but excluding the next Interest Payment Date, the last such
Interest  Payment Date being the Stated Maturity  specified  herein,  at the per
annum rate shown herein  calculated on the basis of a 360-day year consisting of
twelve 30-day  months and shall be payable in arrears on Interest  Payment Dates
and on the Stated  Maturity.  If payment of interest  and  principal  due on any
Interest  Payment  Date,  including  the  Stated  Maturity,  does  not fall on a
Business Day, such payment will be made on the next succeeding Business Day with
the same force and effect as if made on the Interest  Payment Date or the Stated
Maturity,  as the case may be, and no interest shall be payable on the amount so
payable for the period from and after such  Interest  Payment Date or the Stated
Maturity,  as the case may be.  Interest,  other  than  interest  payable on the
Stated Maturity,  shall be paid by the Bank on each Interest Payment Date to the
person in whose name this Note is  registered  at the close of  business  on the
Regular Record Date; provided,  however, that if the Original Issue Date of this
Note is between a Record Date and the  applicable  Interest  Payment  Date,  the
initial  payment of  interest  with  respect to this Note will be payable on the
Interest  Payment Date following the next succeeding  Regular Record Date to the
Registered Holder of this Note on such next succeeding Record Date. For purposes
of this Note,  "Business  Day" means any day,  that is not a Saturday or Sunday,
and that is not a day on which banking  institutions are authorized or obligated
by law or executive order to close in the City of New York, New York or the City
of Bowling Green, Kentucky.

Principal,  premium,  if any and  interest  payments  on  Notes  will be made in
immediately available funds to the Registered Holder.

The Registered  Holder may declare the principal amount of, and accrued interest
on,  this Note to be due and  payable  immediately  if an Event of Default  with
respect to the Note shall have  occurred and be  continuing  at the time of such
declaration. Any Event of Default with respect to this Note may be waived by the
Registered Holder.

[Senior Bank Notes:  For purposes of this Note, an "Event of Default" shall
 mean any one of the following events:



<PAGE>


-------------------------------------------------------------------------------
                  default in the payment of any  interest  upon the Note when it
                  becomes due and payable, and continuance of such default for a
                  period of 30 days; or
------------------------------------------------------------------------------

                            default in the payment of the principal of (or
                  premium, if any, on) the Note when
                  due; or

                            default  in  the  performance  of  any  covenant  or
                  agreement of the Bank  contained  in the Note which  continues
                  for 60 days  after  receipt  of  written  notice  given by the
                  Registered Holder; or

                            the  Bank  shall  consent  to the  appointment  of a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar  official  in any  insolvency,  readjustment  of debt,
                  marshaling of assets and liabilities or similar proceedings of
                  or  relating  to  the  Bank  or  of  or  relating  to  all  or
                  substantially  all of its property;  or a decree or order of a
                  court or agency or supervisory  authority having  jurisdiction
                  in the  premises  for  the  appointment  of a  conservator  or
                  receiver or liquidator or trustee or other similar official in
                  any insolvency, readjustment of debt, marshaling of assets and
                  liabilities or similar  proceedings,  or for the winding-up or
                  liquidation  of its affairs,  shall have been entered  against
                  the Bank and such decree or order shall have remained in force
                  undischarged or unstayed for a period of 60 consecutive  days;
                  or the Bank  shall file a petition  to take  advantage  of any
                  applicable insolvency or reorganization statute.]

[Subordinated  Bank Notes:  "For  purposes  of this Note,  an "Event of Default"
shall occur if the Bank shall consent to the  appointment  of a  conservator  or
receiver or liquidator or trustee or other similar  official in any  insolvency,
readjustment   of  debt,   marshaling  of  assets  and  liabilities  or  similar
proceedings of or relating to the Bank or of or relating to all or substantially
all of its  property;  or a decree or order of a court or agency or  supervisory
authority  having  jurisdiction  in  the  premises  for  the  appointment  of  a
conservator  or receiver or liquidator  or trustee or other similar  official in
any insolvency,  readjustment  of debt,  marshaling of assets and liabilities or
similar proceedings,  or for the winding-up or liquidation of its affairs, shall
have been entered  against the Bank and such decree or order shall have remained
in force  undischarged  or unstayed for a period of 60 consecutive  days; or the
Bank shall file a petition to take  advantage of any  applicable  insolvency  or
reorganization statute.

The holder of this Note, by its acceptance hereof,  agrees that the indebtedness
of the Bank  evidenced by this Note,  including the  principal and interest,  is
unsecured  and  subordinate  and  junior  in  right  of  payment  to the  Bank's
obligations to its depositors,  its obligations  under banker's  acceptances and
letters of credit,  and its  obligations to its other  creditors  (including any
obligations to any Federal  Reserve Bank and the FDIC),  whether  outstanding at
the time this Note is issued or  thereafter  incurred  (except  any  obligations
which by their express  terms rank on a parity with or junior to this Note),  in
that in the case of any insolvency proceedings,  receivership,  conservatorship,
reorganization,  readjustment of debt,  marshalling of assets and liabilities or
similar proceedings or any liquidation or winding up of or relating to the Bank,
whether voluntary or involuntary, all such obligations (except obligations which
rank on a parity  with or junior to this Note)  shall be  entitled to be paid in
full before any payment shall be made on account of the principal of or interest
on this Note. In the event of any such proceeding,  after payment in full of all
sums owing with  respect  to such  prior  obligations,  the holder of this Note,
together  with the holders of any  obligations  of the Bank  ranking on a parity
with this Note,  shall be entitled to be paid pro rata from the remaining assets
of the Bank the unpaid  principal  of, and the unpaid  interest on, this Note or
such other  obligations  before any  payment or other  distribution,  whether in
cash, property,  or otherwise,  shall be made on account of any capital stock or
any obligations of the Bank ranking junior to this Note.

This Note contains no limitation on the amount of senior debt, deposits or other
obligations  that rank  senior to this Note that may be  hereafter  incurred  or
assumed by the Bank.]

[Senior  Bank Notes:  This Note may be subject to repayment at the option of the
Registered  Holder hereof on the Repayment Date(s) indicated on the face hereof.
If no such date is set forth on the face hereof,  this Note may not be so repaid
at the  option  of the  Registered  Holder  hereof  prior to  maturity.  On each
Repayment  Date,  if any,  this Note shall be  repayable  in whole or in part in
increments of $1,000  (provided that any remaining  principal hereof shall be at
least  $500,000) at the option of the  Registered  Holder  hereof at a repayment
price equal to 100% of the principal amount to be repaid,  or if this Note is an
Original Issue  Discount Note (as specified on the face hereof),  the applicable
Repayment  Price  specified on the face hereof  together in the case of any such
repayment  with interest  thereon  payable to the Repayment  Date,  but interest
installments  due prior to the Repayment  Date will be payable to the Registered
Holder on the relevant Regular Record Date or special record date. For this Note
to be repaid in whole or in part at the option of the Registered  Holder hereof,
_____________________________________,  as Fiscal and Paying  Agent,  at [insert
address];  Attention:  _______________  , or at such other  address of which the
Bank shall from time to time  notify the  Registered  Holder of the Notes,  must
receive not more than 45, nor less than 30, days prior to a Repayment  Date,  if
any,  either (i) this Note  accompanied  by the form  entitled  "Option to Elect
Repayment"  below  duly  completed,   or  (ii)  a  telegram,   telex,  facsimile
transmission  or letter from a member of a national  securities  exchange or the
National  Association of Securities Dealers,  Inc. or a commercial bank or trust
company in the United States of America setting forth the name of the Registered
Holder,  the principal amount of this Note, the principal amount of this Note to
be repaid, the certificate number or a description of the tenor and terms of the
Note, a statement that the option to elect repayment is being exercised  thereby
and a  guarantee  that the Note to be repaid with the form  entitled  "Option to
Elect  Repayment" on the Note duly  completed will be received by the Fiscal and
Paying Agent not later than five Business Days after the date of such  telegram,
telex,  facsimile  transmission  or letter and such Note and form duly completed
are received by the Fiscal and Paying Agent by such fifth Business Day. Exercise
of such repayment  option by the Registered  Holder hereof shall be irrevocable,
except a Registered  Holder  tendering after receipt of a notice of an extension
of maturity.]

If so provided  on the face of this Note,  this Note may be redeemed by the Bank
on any Redemption  Date (or range of Redemption  Dates) so indicated on the face
hereof. If no Redemption Date (or range of Redemption Dates) is set forth on the
face hereof, this Note may not be redeemed prior to its Stated Maturity.  If one
or more Redemption Dates (or ranges of Redemption Dates) are so specified,  this
Note is  subject  to  redemption  at the  option  of the  Bank,  upon  notice by
first-class mail, not less than 30 nor more than 45 days prior to the Redemption
Date specified in such notice,  at the applicable  redemption price specified on
the face hereof (expressed as a percentage of the principal amount of this Note)
together  in the  case of any  such  redemption  with  accrued  interest  to the
Redemption Date, but interest installments due will be payable to the Registered
Holder on the relevant Regular Record Date if the Redemption Date is an Interest
Payment Date. The Bank may elect to redeem less than the entire principal amount
hereof;  provided,  that the principal amount, if any, of this Note that remains
outstanding after such redemption is an Authorized Denomination. In the event of
any redemption in part, the Bank will not be required to (i) issue, register the
transfer  of, or exchange  any Note during a period  beginning at the opening of
business 15 days before the day of the  mailing of the notice of  redemption  of
Notes selected for redemption and ending at the close of business on the date of
mailing of the relevant  notice of  redemption  or (ii) register the transfer or
exchange of any Note, or any portion thereof, called for redemption,  except the
unredeemed portion of any Note being redeemed in part. [Subordinated Bank Notes:
Notwithstanding  the foregoing,  this Note may not be redeemed without the prior
written consent of the Federal Deposit Insurance Corporation.]

All notices to the Bank under this Note shall be in writing or  addressed to the
Fiscal   and   Paying   Agent  at   [insert   name  and   address];   Attention:
_______________,  or to such other address as the Bank may notify the Registered
Holder.

This Note shall be governed by and construed in accordance  with the laws of the
State of New York.

No interest will accrue on this Note after its maturity.

The Notes of this series are issuable only in registered  form without  interest
coupons in denominations of $250,000 and integral  multiples of $1,000 in excess
thereof (each an "Authorized Denomination").

Any money  deposited  with the Fiscal and  Paying  Agent for the  payment of the
principal of,  premium (if any) or interest on this Note that remains  unclaimed
for two years after such principal,  premium (if any) or interest has become due
and payable  shall be paid to the Bank and the Holder  shall  thereafter,  as an
unsecured general creditor,  look only to the Bank for payment thereof,  and all
liability  of the  Fiscal  and Paying  Agent  with  respect to such money  shall
thereupon cease.

IN  WITNESS  WHEREOF,  the Bank has  caused  this Note to be duly  executed  and
countersigned as of the date set forth herein.

This Note is not valid for any  purpose  until  countersigned  by the Fiscal and
Paying Agent or such other  institution  as may be appointed by the Bank and the
certificate of authentication affixed hereon.


Countersigned for                              By Trans Financial Bank,
                                                  National Association
                                                       n
  authentication only

  as Fiscal and Paying Agent


By__________________________                         ___________________________
         Authorized Signature                        Authorized Signature

                                                              Attest:




                                                              -----------------
                                                              Secretary


<PAGE>


                            OPTION TO ELECT REPAYMENT

The  undersigned  hereby  irrevocably  request (s) and  instruct (s) the Bank to
repay the within Note (or portion thereof specified below) pursuant to its terms
at a price equal to the principal amount thereof,  together with interest to the
repayment date, to the undersigned, at


              (Please print or typewrite name and address of the Undersigned)

For this Note to be repaid the Fiscal and Paying  Agent must  receive at [insert
name and address]; Attention:  _______________, or at such other place or places
of which the  Company  shall  from time to time  notify the Holder of the within
Note,  not more than 45, nor less than 30,  days prior to a Repayment  Date,  if
any,  shown on the face of the  within  Note,  either  (i) this  Note  with this
"Option to Elect  Repayment"  form duly  completed,  or (ii) a telegram,  telex,
facsimile transmission or letter from a member of a national securities exchange
or the National Association of Securities Dealers,  Inc. or a commercial bank or
trust  company in the United  States of  America  setting  forth the name of the
Registered  Holder of the Note, the principal  amount of the Note, the principal
amount of the Note to be repaid,  the certificate number or a description of the
tenor and terms of the Note, a statement  that the option to elect  repayment is
being exercised thereby and a guarantee that the Note to be repaid with the form
entitled  "Option to Elect  Repayment"  duly  completed  will be received by the
Fiscal and Paying Agent not later than five Business Days after the date of such
telegram,  telex,  facsimile  transmission or letter and such Note and form duly
completed  are  received by the Fiscal and Paying  Agent by such fifth  Business
Day.

If less than the entire  principal  amount of the  within  Note is to be repaid,
specify the portion  thereof  (which shall be  increments  of $1,000)  which the
Holder  elects to have  repaid:  $________;  and  specify  the  denomination  or
denominations  (which  shall be $500,000  or an  integral  multiple of $1,000 in
excess of  $500,000)  of the Notes to be issued to the Holder for the portion of
the within Note not being repaid (in the absence of any such specification,  one
such Note will be issued for the portion not being repaid): $________.

Date:_______________                        ____________________________________
                                                     Note: The signature on this
                                                     Option  to Elect  Repayment
                                                     must  correspond  with  the
                                                     name as  written  upon  the
                                                     face of this  Note in every
                                                     particular          without
                                                     alteration or enlargement.


<PAGE>


                                              -------------------------
                                                    ABBREVIATIONS


The following  abbreviations,  when used in the  inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

                  TEN COM -- as tenants in common

                  TEN ENT -- as tenants by the entireties

                  JT ENT  -- as joint tenants and not as tenants in common
                                                                       Custodian
                  UNIF GIFT MIN ACT --
 ................................................................................
                                                              (Cust)    (Minor)
                                                under Uniform Gift to Minors Act

 ..............................................................................
                                                                        (State)

Additional abbreviations may be used though not in the above list.



FOR VALUE  RECEIVED the  undersigned  hereby sells,  assigns and transfers  unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE


(Name and address of assignee, including zip code, must be printed or
typewritten)


the within Note, and all rights thereunder, hereby irrevocably constituting
and appointing


to  transfer  said Note on the books of the within  Company,  with full power of
substitution in the premises.

Dated:


NOTICE:  The  signature  to this  assignment  must  correspond  with the name as
written upon the face of the within Note in every particular, without alteration
or  enlargement  or any change  whatever and must be  guaranteed by an "eligible
guarantor  institution" meeting the requirements of the Fiscal and Paying Agent,
which  requirements  include  membership or participation in STAMP or such other
"signature guaranty program" as may be determined by the Fiscal and Paying Agent
in  addition  to or in  substitution  for  STAMP,  all in  accordance  with  the
Securities Exchange Act of 1934, as amended.


<PAGE>


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

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





                                                        

                                 EXHIBIT B-1 TO
                                FISCAL AND PAYING
                                AGENCY AGREEMENT
                              (Short-Term Floating)


UNLESS AND UNTIL IT IS EXCHANGED  IN WHOLE OR IN PART FOR NOTES IN  CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED  EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER  NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR  DEPOSITARY  OR A NOMINEE OF SUCH  SUCCESSOR  DEPOSITARY.  UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY  (55 WATER  STREET,  NEW YORK,  NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE  NAME OF CEDE & CO.  OR  SUCH  OTHER  NAME  AS  REQUESTED  BY AN  AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO.,  ANY  TRANSFER,  PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL  SINCE THE  REGISTERED  OWNER HEREOF,  CEDE & CO., HAS AN
INTEREST HEREIN.

THIS BANK NOTE IS A DIRECT, UNCONDITIONAL,  UNSECURED AND UNSUBORDINATED GENERAL
OBLIGATION OF THE BANK.  THE  OBLIGATION  EVIDENCED BY THIS BANK NOTE RANKS PARI
PASSU  WITH ALL OTHER  UNSECURED  AND  UNSUBORDINATED  OBLIGATIONS  OF THE BANK,
EXCEPT  OBLIGATIONS  THAT ARE SUBJECT TO ANY  PRIORITIES  OR  PREFERENCES  UNDER
APPLICABLE LAW, INCLUDING DEPOSIT OBLIGATIONS.

THIS BANK NOTE DOES NOT  EVIDENCE A DEPOSIT  AND IS NOT  INSURED BY THE  FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY OR OTHER INSURER.

REGISTERED                                                           REGISTERED
No. FLR. _______________
CUSIP __________________


                                                 FLOATING RATE NOTE
                                     TRANS FINANCIAL BANK, NATIONAL ASSOCIATION


ORIGINAL ISSUE DATE:                        STATED MATURITY:

REGULAR RECORD DATES:               INTEREST PAYMENT DATES:

INITIAL INTEREST RATE:              SPREAD:

INDEX MATURITY:                     SPREAD MULTIPLIER:

INTEREST RATE BASIS:                INTEREST ACCRUAL DATE:

MAXIMUM INTEREST RATE:              INTEREST DETERMINATION DATES:

MINIMUM INTEREST RATE:              CALCULATION DATE:

INTEREST RESET DATES:               REDEMPTION DATES:

REPAYMENT DATE(S):                          REDEMPTION PRICE:

REPAYMENT PRICE:                    OTHER REDEMPTION TERMS:

OTHER REPAYMENT TERMS:              OTHER TERMS:

ORIGINAL ISSUE DISCOUNT NOTE:    TOTAL AMOUNT OF OID:  ISSUE PRICE (expressed 
                                                       as a percentage of
                                                       aggregate principal
                                                       amount):
----

----
----
 Yes     No
-------------------------------------
--------------------

--------------------
--------------------
      10
YIELD TO MATURITY:   SHORT ACCRUAL PERIOD OID:       METHOD USED TO DETERMINE
                                                     YIELD FOR SHORT
                                                     ACCRUAL PERIOD:
                                                                          --

                                                                          --
                                                                          --

                                                        Approximate   Exact
                                                    -------------------------
                                                    -------------------------

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

--------------------------------------------------------------------------------
Trans Financial Bank, National  Association (the "Bank", which term includes any
successor  thereof)  for  value  received,  hereby  promises  to pay  the sum of
____________________  U.S.  dollars  ($________) to CEDE & CO. (the  "Registered
Holder") as nominee of The  Depository  Trust  Company  ("DTC") as custodian for
participants  each acting for themselves and as nominee or custodian for others,
including  trusts,  pension  and  retirement  plans and  accounts,  fiduciaries,
custodians and nominees (the  "Participants")  on the Stated Maturity and to pay
interest on a regular periodic basis as specified herein.

Interest  on this Note shall be payable  monthly,  quarterly,  semiannually,  or
annually  on each  Interest  Payment  Date  specified  herein  and on the Stated
Maturity specified herein at a rate per annum equal to the Initial Interest Rate
specified  herein until the first Interest Reset Date specified herein following
the Original Issue Date specified  herein and thereafter at a rate determined in
accordance  with the provisions  herein under the heading(s)  "Determination  of
Commercial Paper Rate",  "Determination  of Fed Funds Rate",  "Determination  of
LIBOR",  "Determination  of  Treasury  Rate",  "Determination  of  Prime  Rate",
Determination of J.J. Kenny Rate", "Determination of 11th District Cost of Funds
Rate" or  "Determination  of CMT Rate"  depending upon whether the Interest Rate
Basis is Commercial  Paper Rate, Fed Funds Rate,  LIBOR,  Treasury  Rate,  Prime
Rate,  J.J.  Kenny  Rate,  11th  District  Cost of Funds Rate or CMT Rate to the
person in whose name this Note is  registered  at the close of  business  on the
Regular Record Date whether or not a Business Day (as defined herein;  provided,
however, that if the Original Issue Date is between a Regular Record Date and an
Interest Payment Date,  interest  payments will commence on the Interest Payment
Date following the next succeeding  Regular Record Date; and provided,  further,
that if an Interest Payment Date or Interest Reset Date would fall on a day that
is not a Business Day, such Interest  Payment Date or Interest  Reset Date shall
be the following  day that is a Business  Day,  except that if the Interest Rate
Basis is LIBOR,  where such  following  Business Day falls in the next  calendar
month,  such  Interest  Payment  Date or  Interest  Reset Date shall be the next
preceding day that is a Business Day. "Business Day" means any day that is not a
Saturday  or  Sunday  and that is not a day on which  banking  institutions  are
authorized  or obligated  by law or executive  order to close in the City of New
York, New York and the City of Bowling Green, Kentucky; or with respect to LIBOR
Notes,  is also a London  Business Day.  "London  Business Day" means any day on
which  dealings  in  deposits  in U.S.  dollars  are  transacted  in the  London
interbank market.

Principal,  premium,  if any,  and  interest  payments  on Notes will be made in
immediately available funds to the Registered Holder.

The Registered  Holder may declare the principal amount of, and accrued interest
on,  this Note to be due and  payable  immediately  if an Event of Default  with
respect to this Note shall have  occurred and be  continuing at the time of such
declaration. Any Event of Default with respect to this Note may be waived by the
Registered Holder.

For  purposes  of this  Note,  an "Event of  Default"  shall mean any one of the
following events:

         (1)      default in the payment of any interest upon the Note when it
                  becomes due and payable, and
                  continuance of such default for a period of 30 days; or

         (2)      default in the payment of the principal of (or premium, if 
                  any, on) the Note when due; or

         (3)      default in the performance of any covenant or agreement of the
                  Bank  contained in the Note which  continues for 60 days after
                  receipt  of  written  notice  given by the  Registered  Holder
                  hereof; or

         (4)      the Bank shall consent to the  appointment of a conservator or
                  receiver or liquidator or trustee or other similar official in
                  any  insolvency,  receivership,  liquidation,  readjustment of
                  debt,   marshaling  of  assets  and   liabilities  or  similar
                  proceedings  of or  relating  to the Bank or of or relating to
                  all or substantially all of its property; or a decree or order
                  of  a  court  or  agency  or  supervisory   authority   having
                  jurisdiction   in  the  premises  for  the  appointment  of  a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar official in any insolvency, receivership, liquidation,
                  readjustment of debt,  marshaling of assets and liabilities or
                  similar  proceedings,  or for the winding-up or liquidation of
                  its affairs, shall have been entered against the Bank and such
                  decree or order shall have remained in force  undischarged  or
                  unstayed  for a period  of 60  consecutive  days;  or the Bank
                  shall  file a petition  to take  advantage  of any  applicable
                  insolvency or reorganization statute.

All notices to the Bank under this Note shall be in writing or  addressed to the
Fiscal   and   Paying   Agent  at   [insert   name  and   address];   Attention:
_________________,  or to  such  other  address  as  the  Bank  may  notify  the
Registered Holder.

This Note shall be governed by and construed in accordance  with the laws of the
State of New York.

No interest will accrue on this Note after its maturity.

Interest:

Interest  payable with respect to each interest  payment  period shall accrue to
but not include the applicable Interest Payment Date or the Stated Maturity,  as
the case may be.  Accrued  interest  hereon from the Issue Date or from the last
date to which  interest  shall have been paid,  as the case may be,  shall be an
amount  calculated by multiplying the face amount hereof by an accrued  interest
factor.  Such accrued  interest  factor shall be computed by adding the interest
factors  calculated  for each day from the Original  Issue Date or from the last
date to which interest shall have been paid, as the case may be, to the date for
which accrued  interest is being  calculated.  The interest factor for each such
day shall be computed by dividing the interest  rate  applicable  to such day by
360 if the Interest Rate Basis is Commercial Paper Rate, Fed Funds Rate,  LIBOR,
Prime Rate,  J.J.  Kenny Rate or 11th  District Cost of Funds Rate, as indicated
herein,  or by the actual  number of days in the year if the Interest Rate Basis
is the Treasury Rate or the CMT Rate, as indicated herein.

The rate of interest  borne by this Note will be reset daily,  weekly,  monthly,
quarterly,  semiannually or annually,  as specified  above.  The "Interest Reset
Date" will be the date specified above; provided, however, that (i) the interest
rate in effect from the  Original  Issue Date to the first  Interest  Reset Date
will be the "Initial  Interest Rate" (as specified herein) and (ii) the interest
rate in effect for the ten days immediately  prior to the Stated Maturity,  will
be that in effect on the tenth day  preceding  such Stated  Maturity.  Each such
adjusted rate shall be applicable on and after the Interest  Reset Date to which
it relates,  to, but not including,  the next succeeding Interest Reset Date, or
until the Stated Maturity,  as the case may be. If any Interest Reset Date would
otherwise be a day that is not a Business Day, such Interest Reset Date shall be
postponed to the next  succeeding day that is a Business Day, except that in the
case  of a  LIBOR  Note,  where  such  following  Business  Day is in  the  next
succeeding  calendar  month,  such Interest Reset Date shall be the  immediately
preceding Business Day.

Determination of Commercial Paper Rate:

If the Interest Rate Basis specified on the face hereof is the Commercial  Paper
Rate,  the interest  rate with respect to this Note for any Interest  Reset Date
shall be the  Commercial  Paper Rate plus or minus the  Spread,  if any,  and/or
multiplied by the Spread Multiplier, if any, as specified on the face hereof, as
determined on the applicable Interest Determination Date (as defined below).

"Commercial Paper Rate" means, with respect to any Interest  Determination Date,
the Money Market Yield  (calculated as described  below) of the rate quoted on a
discount  basis on that date for  commercial  paper  having  the Index  Maturity
specified on the face hereof as made available and subsequently published by the
Board of  Governors of the Federal  Reserve  System (the  "Federal  Reserve") in
"Statistical  Release  H.15(519),  Selected  Interest  Rates"  or any  successor
publication ("H.15(519)") under the heading "Commercial Paper". If by 3:00 p.m.,
New York City time, on the Calculation  Date (as defined below) such rate is not
yet made  available  by the Federal  Reserve nor made  available  by the Federal
Reserve Bank of New York (the "New York Fed"),  then the  Commercial  Paper Rate
shall be the Money Market Yield on such Interest  Determination Date of the rate
of  commercial  paper of the  Index  Maturity  specified  on the face  hereof as
published by the New York Fed in its daily statistical release,  "Composite 3:30
P.M. Quotations for U.S. Government Securities"  ("Composite  Quotations") under
the heading  "Commercial  Paper" prior to 3:00 P.M., New York City Time. If such
rate is neither published in H.15(519) nor in Composite  Quotations by 3:00 P.M.
New York City time, on the Calculation  Date, the Commercial Paper Rate for that
Interest  Determination  Date shall be calculated by the  Calculation  Agent (as
defined below) and shall be the Money Market Yield of the arithmetic  mean (each
as rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage  point) of the offered rates of three  leading  dealers of commercial
paper in the  City of New York  selected  by the  Calculation  Agent as of 11:00
a.m.,  New York City time, on that Interest  Determination  Date, for commercial
paper having such Index  Maturity  placed for an industrial  issuer whose senior
unsecured  bond rating is "AA" or the  equivalent  from a nationally  recognized
securities  rating agency;  provided,  however,  that if the dealers selected as
aforesaid  by the  Calculation  Agent  are  not  quoting  as  mentioned  in this
sentence,  the Commercial Paper Rate with respect to such Interest Determination
Date will be the Commercial Paper Rate in effect on such Interest  Determination
Date.

"Money  Market  Yield"  shall  be a yield  (expressed  as a  percentage  rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point) calculated in accordance with the following formula:

                                                             D x 360
                               Money Market Yield = ..................... x 100
                                                             360 - (D x M)

where "D" refers to the per annum  rate for the  commercial  paper,  quoted on a
bank  discount  basis and  expressed as a decimal,  and "M" refers to the actual
number of days in the interest period for which interest is being calculated.

Determination of Fed Funds Rate:

If the Interest  Rate Basis  specified on the face hereof is the Fed Funds Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the Fed Funds Rate plus or minus the Spread, if any, or multiplied by the Spread
Multiplier,  if any, as  specified  on the face  hereof,  as  determined  on the
applicable Interest Determination Date.

"Fed Funds Rate" means,  with respect to any Interest  Determination  Date,  the
rate on that day for Federal  Funds having the Index  Maturity  specified on the
face hereof as made available and subsequently  published in H.15(519) under the
heading "Federal Funds  (Effective)." In the event that such rate is not so made
available by 3:00 p.m., New York City time, on the  Calculation  Date pertaining
to such Interest Determination Date, the Fed Funds Rate will be the rate on such
Interest  Determination  Date  for  Federal  Funds  having  the  Index  Maturity
specified on the face hereof as is made available and subsequently  published in
Composite Quotations under the heading "Federal  Funds/Effective  Rate." If such
rate is neither made available by the Federal  Reserve nor made available by the
New  York  Fed by 3:00  p.m.,  New  York  City  time,  on the  Calculation  Date
pertaining  to such  Interest  Determination  Date,  the Fed Funds Rate for such
Interest Determination Date will be calculated by the Calculation Agent and will
be the arithmetic mean (rounded  upwards,  if necessary,  to the next higher one
hundred-thousandth  of a percentage point) of the rates for the last transaction
in overnight  Federal funds  arranged by three leading  brokers of Federal funds
transactions  in the City of New York  selected by the  Calculation  Agent as of
9:00 a.m., New York City time, on such Interest  Determination  Date;  provided,
however,  that if the brokers selected as aforesaid by the Calculation Agent are
not quoting as  mentioned in this  sentence,  the Fed Funds Rate will be the Fed
Funds Rate in effect on such Interest Determination Date.

Determination of LIBOR:

If the Interest Rate Basis  specified on the face hereof is LIBOR,  the interest
rate with respect to this Note for any  Interest  Reset Date shall be LIBOR plus
or minus the Spread, if any, or multiplied by the Spread Multiplier,  if any, as
specified  on  the  face  hereof,  as  determined  on  the  applicable  Interest
Determination Date.

"LIBOR" will be determined by the Calculation Agent in accordance with the
following provisions:

                    LIBOR will be, either (i) the arithmetic mean of the offered
         rates for deposits in U.S. dollars having the Index Maturity designated
         on the  face  hereof  commencing  on the  second  London  Business  Day
         immediately  following that LIBOR  Interest  Determination  Date,  that
         appear on the Reuters  Screen LIBO Page as of 11:00 A.M.,  London time,
         on that LIBOR Interest Determination Date, if at least two such offered
         rates appear on the Reuters Screen LIBO Page ("LIBOR Reuters"), or (ii)
         the rate  for  deposits  in U.S.  dollars  having  the  Index  Maturity
         designated on the face hereof  commencing on the second London Business
         Day immediately following that LIBOR Interest  Determination Date, that
         appears on the Telerate  Page 3750,  as of 11:00 A.M.,  London time, on
         that LIBOR Interest  Determination  Date ("LIBOR  Telerate").  "Reuters
         Screen LIBO Page" means the  display  designated  as page "LIBO" on the
         Reuters  Monitor Money Rates Service (or such other page as may replace
         the LIBO page on that  service  for the  purpose of  displaying  London
         interbank offered rates of major banks). "Telerate Page 3750" means the
         display  designated  as page  "3750" on the  Telerate  Service (or such
         other page as may replace  the 3750 page on that  service or such other
         service  or  services  as may be  nominated  by  the  British  Bankers'
         Association  for the purpose of  displaying  London  interbank  offered
         rates for U.S.  dollar  deposits).  If neither  LIBOR Reuters nor LIBOR
         Telerate is specified in the  Book-Entry  Bank Note  representing  such
         LIBOR Note,  LIBOR will be  determined  as if LIBOR  Telerate  has been
         specified. If fewer than two offered rates appear on the Reuters Screen
         LIBO  Page,  or if no  rate  appears  on the  Telerate  Page  3750,  as
         applicable,  LIBOR in respect of that LIBOR Interest Determination Date
         will be determined  as if the parties had specified the rate  described
         in (b) below.

          With respect to a LIBOR Interest Determination Date on which
         fewer than two offered
         rates  appear on the Reuters  Screen LIBO Page,  as specified in (a)(i)
         above,  or on which no rate appears on Telerate Page 3750, as specified
         in (a)(ii) above, as applicable,  LIBOR will be determined on the basis
         of the  rates  at which  deposits  in U.S.  dollars  having  the  Index
         Maturity  designated  on the face hereof are  offered at  approximately
         11:00 A.M., London time, on that LIBOR Interest  Determination  Date by
         four  major  banks  in the  London  interbank  market  selected  by the
         Calculation  Agent  ("LIBOR  Reference  Banks")  to prime  banks in the
         London  interbank  market  commencing on the second London Business Day
         immediately  following that LIBOR Interest  Determination Date and in a
         principal amount equal to an amount of not less than $1,000,000 that is
         representative  for a single  transaction  in such market at such time.
         The Calculation  Agent will request the principal London office of each
         of the LIBOR  Reference Banks to provide a quotation of its rate. If at
         least two such quotations are provided,  LIBOR in respect of that LIBOR
         Interest  Determination  Date  will  be the  arithmetic  mean  of  such
         quotations. If fewer than two quotations are provided, LIBOR in respect
         of that LIBOR Interest  Determination  Date will be the arithmetic mean
         of the rates quoted at approximately 11:00 A.M., New York City time, on
         that LIBOR Interest Determination Date by three major banks in The City
         of New York selected by the Calculation Agent for loans in U.S. dollars
         to leading  European banks having the Index Maturity  designated on the
         face hereof  commencing on the second London  Business Day  immediately
         following  that LIBOR  Interest  Determination  Date and in a principal
         amount  equal  to an  amount  of  not  less  than  $1,000,000  that  is
         representative  for a single  transaction  in such market at such time;
         provided,  however,  that if the banks  selected  as  aforesaid  by the
         Calculation Agent are not quoting as mentioned in this sentence,  LIBOR
         with respect to such LIBOR Interest Determination Date will be the rate
         of LIBOR in effect on such date.

Determination of Treasury Rate:

If the Interest  Rate Basis  specified on the face hereof is the Treasury  Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the Treasury  Rate plus or minus the Spread,  if any,  and/or  multiplied by the
Spread Multiplier, if any, as specified on the face hereof, as determined on the
applicable Interest Determination Date.

"Treasury Rate" means, with respect to any Interest Determination Date, the rate
for  the  most  recent  auction  of  direct  obligations  of the  United  States
("Treasury  Bills")  having the Index  Maturity  specified on the face hereof as
published in H.15(519)  under the heading "U.S.  Government  Securities/Treasury
Bills/Auction  Average  (Investment)" or, if not so made available by 3:00 p.m.,
New  York  City  time,  on the  Calculation  Date  pertaining  to such  Interest
Determination Date the auction average rate (expressed as a bond equivalent,  on
the basis of a year of 365 or 366 days,  as  applicable,  and applied on a daily
basis)  for  such  auction  or as  otherwise  announced  by  the  United  States
Department of the Treasury by 3:00 p.m., New York City time, on such Calculation
Date. In the event that the results of the auction of Treasury  Bills having the
Index  Maturity  specified on the face hereof are neither made  available by the
Federal  Reserve nor otherwise  published or reported as provided  above by 3:00
p.m., New York City time, on such Calculation Date or no such auction is held in
a particular week, then the Treasury Rate shall be calculated by the Calculation
Agent and shall be a yield to maturity (expressed as a bond equivalent,  rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point, on the basis of a year of 365 or 366 days, as applicable,  and applied on
a daily basis) of the arithmetic  mean of the secondary  market bid rates, as of
3:30 p.m.,  New York City time,  on such Interest  Determination  Date, of three
leading  primary United States  government  securities  dealers  selected by the
Calculation  Agent,  for the issue of Treasury  Bills with a remaining  maturity
closest to the Index Maturity specified on the face hereof;  provided,  however,
that if the  dealers  selected as  aforesaid  by the  Calculation  Agent are not
quoting as mentioned in this  sentence,  the Treasury  Rate with respect to such
Interest Determination Date will be the Treasury Rate in effect on such Interest
Determination Date.

Determination of Prime Rate:

If the Interest Rate Basis  specified on the face hereof is the Prime Rate,  the
interest rate with respect to this Note for any Interest Reset Date shall be the
Prime  Rate  plus or minus the  Spread,  if any,  or  multiplied  by the  Spread
multiplier,  if any, as  specified  on the face  hereof,  as  determined  on the
applicable Interest Determination Date.

"Prime  Rate" for each such  Interest  Reset Date will be  determined  as of the
Prime  Rate  Interest  Determination  Date and will be the rate as such  rate is
published in H.15(519)  under the heading "Bank Prime Loan." If such rate is not
published  prior to 3:00 P.M.,  New York City time,  on the related  Calculation
Date,  then the Prime Rate shall be the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen NYMF Page (as
defined  below) as such bank's  prime rate or base lending rate as in effect for
such Prime Rate Interest  Determination  Date. If fewer than four such rates but
more than one such rate  appear on the  Reuters  Screen NYMF Page for such Prime
Rate Interest Determination Date, the Prime Rate shall be the arithmetic mean of
the prime  rates  quoted on the basis of the  actual  number of days in the year
divided  by a  360-day  year as of the  close of  business  on such  Prime  Rate
Interest  Determination Date by three, or two if only two such rates are quoted,
major money center  banks in The City of New York (which may include  affiliates
of certain of the Agents)  selected by the Calculation  Agent. If fewer than two
such  rates  appear on the  Reuters  Screen  NYMF  Page,  the Prime Rate will be
determined by the  Calculation  Agent on the basis of the rates furnished in The
City of New York by three, or two if only two such rates are quoted,  substitute
banks or trust  companies  organized  and doing  business  under the laws of the
United  States,  or any state  thereof,  having total equity capital of at least
$500 million and being subject to supervision or examination or state authority,
selected  by the  Calculation  Agent to  provide  such rate or rates;  provided,
however,  that if  fewer  than  two such  substitute  banks  or trust  companies
selected as aforesaid are quoting as mentioned in this sentence,  the Prime Rate
determined as of such Prime Rate Interest  Determination Date shall be the Prime
Rate in effect on such Prime Rate Interest Determination Date.

"Reuters  Screen NYMF Page" means the display  designated  as page "NYMF" on the
Reuters  Monitor Money Rates Service (or such other page as may replace the NYMF
page on that service for the purpose of  displaying  prime rates or base lending
rates of major United States banks).

Determination of J.J. Kenny Rate:

If the Interest Rate Basis  specified on the face hereof is the J.J. Kenny Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the J.J. Kenny Rate plus or minus the Spread,  if any, and/or  multiplied by the
Spread Multiplier, if any, as specified on the face hereof, as determined on the
applicable Interest Determination Date.

"J.J.  Kenny Rate" means the rate in the high grade  weekly  index (the  "Weekly
Index") on such date made available by Kenny  Information  Systems  ("Kenny") to
the  Calculation  Agent.  The Weekly  Index is, and shall be,  based upon 30-day
yield  evaluations at par of bonds, the interest of which is exempt from Federal
income taxation under the Internal Revenue Code of 1986, as amended, of not less
than five high grade  component  issuers  selected by Kenny which shall include,
without  limitation,  issuers of general  obligation bonds. The specific issuers
included  among the component  issuers may be changed from time to time by Kenny
in its  discretion.  The  bonds on which  the  Weekly  Index is based  shall not
include  any bonds on which the  interest is subject to a minimum tax or similar
tax under the Internal  Revenue Code of 1986, as amended,  unless all tax-exempt
bonds are subject to such tax. In the event Kenny ceases to make  available such
Weekly Index,  a successor  indexing  agent will be selected by the  Calculation
Agent,  such index to reflect the prevailing rate for bonds rated in the highest
short-term  rating category by Moody's  Investors  Service,  Inc. and Standard &
Poor's  Corporation in respect of issuers most closely resembling the high grade
component  issuers selected by Kenny for its Weekly Index, the interest on which
is (A) variable on a weekly basis, (B) exempt from Federal income taxation under
the Internal Revenue Code of 1986, as amended,  and (C) not subject to a minimum
tax or  similar  tax under the  Internal  Revenue of Code of 1986,  as  amended,
unless all tax-exempt bonds are subject to such tax. If such successor  indexing
agent is not available, the rate for any J.J. Kenney Interest Determination Date
shall  be 67% of the  rate  determined  if the  Treasury  Rate  option  had been
originally  selected.  The Calculation Agent shall calculate the J.J. Kenny Rate
in accordance with the foregoing.

Determination of 11th District Cost of Funds Rate:

If the Interest  Rate Basis  specified  on the face hereof is the 11th  District
Cost of Funds Rate, the interest rate with respect to this Note for any Interest
Reset  Date  shall be the 11th  District  Cost of Funds  Rate  plus or minus the
Spread, if any, and/or multiplied by the Spread Multiplier, if any, as specified
on the face hereof, as determined on the applicable Interest Determination Date.

Unless otherwise indicated in an applicable  supplement to the Offering Circular
or on the Book-Entry Bank Note  representing an 11th District Cost of Funds Rate
Note,  "11th  District  Cost of Funds  Rate"  means,  with  respect  to any 11th
District Cost of Funds  Interest  Determination  Date, the monthly 11th District
Cost of Funds Index (the "11th  District  Cost of Funds  Index")  normally  made
available  and  subsequently  published  by the  Federal  Home  Loan Bank of San
Francisco (the "FHLB of San Francisco")  during the month immediately  preceding
the  Interest  Reset Date to which  such 11th  District  Cost of Funds  Interest
Determination Date applies.

The 11th District Cost of Funds Index is normally made  available by the FHLB of
San  Francisco  on the last day on which the FHLB of San  Francisco  is open for
business in each month and represents the monthly weighted average cost of funds
for savings  institutions  in the 11th  District  of the Federal  Home Loan Bank
system  for the month  preceding  the month in which the 11th  District  Cost of
Funds Index is made available.  Currently, the 11th District Cost of Funds Index
is computed by the FHLB of San  Francisco for each month by dividing the cost of
funds (interest paid during the month by 11th District  savings  institutions on
savings,  advances  and other  borrowing)  by the average of the total amount of
those  funds  outstanding  at the end of that  month  and the  prior  month  and
annualizing and adjusting the result to reflect the actual number of days in the
particular  month.  If  necessary,  before  these  calculations  are  made,  the
component  figures are adjusted by the FHLB of San Francisco to  neutralize  the
effect of events  such as  member  institutions  leaving  the 11th  District  or
acquiring institutions outside the 11th District.

If the FHLB of San Francisco  shall fail in any month to make available the 11th
District Cost of Funds Index (each such failure  being  referred to herein as an
"Alternate  Rate  Event"),  then the 11th  District  Cost of Funds  Rate for the
Interest  Determination  Date after the Alternate Rate Event shall be calculated
on the  basis of the  11th  District  Cost of Funds  Index  most  recently  made
available  prior to such 11th  District  Costs of Funds  Interest  Determination
Date.  If an Alternate  Rate Event occurs in the month  immediately  following a
month in which a prior  Alternate  Rate Event  occurred,  then the 11th District
Cost of Funds Rate for the Interest Determination Date immediately following the
second  Alternate  Rate  Event  shall  be  calculated  on the  basis of the 11th
District Cost of Funds Index most recently made available prior to such Interest
Determination  Date and,  thereafter,  the 11th  District Cost of Funds Rate for
each succeeding Interest Determination Date shall be LIBOR, determined as though
the  Interest  Rate Basis  were LIBOR and the Spread  shall be plus or minus the
number of basis points  specified in the applicable  11th District Cost of Funds
Rate Note as the "Alternate Rate Event Spread", if any.

In  determining  that the FHLB of San  Francisco has failed in any month to make
available the 11th District Cost of Funds Index, the Calculation  Agent may rely
conclusively  on any  written  advice  from  the FHLB of San  Francisco  to such
effect.

Determination of CMT Rate:

If the Interest  Rate Basis  specified  on the face hereof is the CMT Rate,  the
interest rate with respect to this Note for any Interest Reset Date shall be the
CMT Rate plus or minus the  Spread,  if any,  and/or  multiplied  by the  Spread
Multiplier,  if any, as  specified  on the face  hereof,  as  determined  on the
applicable Interest Determination Date.

"CMT Rate" means, with respect to any CMT Interest Determination Date, the rate
displayed on the Designated CMT
Telerate Page (as defined below) under the caption ". . . Treasury Constant
Maturities . . . Federal Reserve
Board Release H.15 . . . Mondays Approximately 3:45 P.M.," under the column for
the Designated CMT Maturity Index
(as defined below) for (i) if the Designated CMT Telerate Page is 7055, the
rate on such CMT Interest
Determination Date and (ii) if the Designated CMT Telerate Page is 7052, the
week, or the month, as applicable,
ended immediately preceding the week in which the applicable CMT Interest 
Determination Date occurs.  If such
rate is no longer displayed on the relevant page, or if not displayed by 
3:00 P.M., New York City time, on the
Calculation Date pertaining to such CMT Interest Determination Date, then th
CMT Rate for such CMT Interest
Determination Date will be such treasury constant maturity rate for the 
Designated CMT Maturity Index as
published in the relevant H.15(519).  If such rate is no longer published, or
if not published by 3:00 P.M., New
York City time, on the Calculation Date pertaining to such CMT Interest
Determination Date, then the CMT Rate for
such CMT Interest Determination Date will be such treasury constant maturity
rate for the Designated CMT Maturity
Index (or other United States Treasury rate for the Designated CMT Maturity 
Index) for the CMT Interest
Determination Date with respect to such Interest Reset Date as may then be
published by either the Federal
Reserve Board or the United States Department of the Treasury that the
Calculation Agent determines to be
comparable to the rate formerly displayed on the Designated CMT Telerate Page
and published in the relevant
H.15(519).  If such information is not provided by 3:00 P.M., New York City
time, on the Calculation Date
pertaining to such CMT Interest Determination Date, then the CMT Rate for the
CMT Interest Determination Date
will be calculated by the Calculation Agent and will be a yield to maturity,
based on the arithmetic mean of the
secondary market closing offer side prices as of approximately 3:30 P.M., New
York City time, on the CMT Interest
Determination Date reported, according to their written records, by three 
leading primary United States
government securities dealers (each, a "Reference Dealer") in The City of New
York selected by the Calculation
Agent (from five such Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation
(or, in the event of equality, one of the highest) and the lowest quotation
 (or, in the event of equality, one of
the lowest)), for the most recently issued direct noncallable fixed rate 
obligations of the United States
("Treasury Notes") with an original maturity of approximately the Designated 
CMT Maturity Index and a remaining
term to maturity of not less than such Designated CMT Maturity Index minus one
 year.  If the Calculation Agent
cannot obtain three such Treasury Note quotations, the CMT Rate for such CMT 
Interest Determination Date will be
calculated by the Calculation Agent and will be a yield to maturity based on 
the arithmetic mean of the secondary
market offer side prices as of approximately 3:30 P.M., New York City time, on 
the Interest Determination Date of
three Reference Dealers in The City of New York (from five such Reference 
Dealers selected by the Calculation
Agent and eliminating the highest quotation (or, in the event of equality, one 
of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest)), for Treasury
 Notes with an original maturity of the
number of years that is the next highest to the Designated CMT Maturity Index
and a remaining term to maturity
closest to the Designated CMT Maturity Index and in an amount of at least
 $100,000,000.  If three or four (and
not five) of such Reference Dealers are quoting as described above, then the
CMT Rate will be based on the
arithmetic mean of the offer prices obtained and neither the highest nor the
lowest of such quotes will be
eliminated; provided however, that if fewer than three Reference Dealers 
selected by the Calculation Agent are
quoting as described herein, the CMT Rate will be the CMT Rate in effect on
such Interest Determination Date.  If
two Treasury Notes with an original maturity as described in the third
preceding sentence, have remaining terms
to maturity equally close to the Designated CMT Maturity Index, the quotes for
the CMT Rate Note with the shorter
remaining term to maturity will be used.

"Designated  CMT  Telerate  Page"  means the  display on the Dow Jones  Telerate
Service on the page  specified  in the  applicable  supplement  to the  Offering
Circular or herein,  (or any other page as may replace such page on that service
for the purpose of  displaying  Treasury  Constant  Maturities  as  published in
H.15(519)),  for the  purpose of  displaying  Treasury  Constant  Maturities  as
published  in  H.15(519).  If no  such  page  is  specified  in  the  applicable
supplement to the Offering Circular or herein,  the Designated CMT Telerate Page
shall be 7052, for the most recent week.

"Designated  CMT Maturity  Index"  means the original  period to maturity of the
Treasury  Notes (either one, two,  three,  five,  seven,  ten,  twenty or thirty
years)  specified  in the  applicable  supplement  to the  Offering  Circular or
herein,  with  respect  to which  the CMT Rate  will be  calculated.  If no such
maturity is specified in the applicable  supplement to the Offering  Circular or
herein, the Designated CMT Maturity Index shall be two years.

General

Notwithstanding  the  determination  of the interest rate as provided above, the
interest rate on this Note for any interest period shall not be greater than the
Maximum  Interest Rate, if any,  and/or less than the Minimum  Interest Rate, if
any,  specified  on the face hereof.  The interest  rate on this Note will in no
event be higher than the maximum rate permitted  under  applicable  state law as
the same may be modified by United States law of general application.

The  Calculation  Agent will,  upon the request of the beneficial  owner of this
Note, provide the interest rate then in effect and, if determined,  the interest
rate  which  will  become  effective  as a result of a  determination  made with
respect to the most  recent  Interest  Determination  Date with  respect to this
Note. Unless changed by the Bank, in its sole discretion,  the Fiscal and Paying
Agent will act as Calculation Agent for this Note and thereafter the Calculation
Agent  shall be such agent as selected  by the Bank.  The Bank shall  notify the
Registered  Holder and the Depository Trust Company of any change in Calculation
Agent.

The Interest Determination Date pertaining to an Interest Reset Date will be the
second  Business Day preceding such Interest Reset Date for all Notes other than
Notes  with an  Interest  Reset  Basis  of LIBOR or the  Treasury  Rate.  If the
Interest  Rate  Basis  specified  on the face  hereof  is  LIBOR,  the  Interest
Determination  Date  pertaining  to an  Interest  Reset  Date will be the second
London  Business Day next  preceding  such Interest  Reset Date. If the Interest
Rate Basis  specified  on the face hereof is the  Treasury  Rate,  the  Interest
Determination  Date  pertaining to an Interest Reset Date will be the day of the
week in which  such  Interest  Reset Date falls on which  Treasury  Bills  would
normally be auctioned (generally,  Monday). If as the result of a legal holiday,
an auction is held on the  preceding  Friday,  such Friday will be the  Interest
Determination  Date  pertaining to the Interest Reset Date occurring in the next
succeeding  week. If an auction date shall fall on any Interest Reset Date for a
Treasury  Rate Note,  then such  Interest  Reset Date shall instead be the first
Business Day immediately following such auction.

All dollar amounts used in or resulting from any calculation  will be rounded to
the nearest cent with  one-half  cent being  rounded  upward.  Unless  otherwise
specified  herein,  all  percentages  resulting  from  any  calculation  will be
rounded, if necessary,  to the nearest one-hundred thousandth of a percent, with
five one-millionths of a percent rounded upwards, e.g., 9.876545% (or .09876545)
being  rounded to 9.87655% (or .0987655)  and  9.876544%  (or  .09876544)  being
rounded to 9.87654% or .0987654).

The   "Calculation   Date",   where   applicable,   pertaining  to  an  Interest
Determination  Date is the  earlier  of (i) the tenth  calendar  day after  such
Interest  Determination  Date,  or if such day is not a Business  Day,  the next
succeeding  Business  Day or (ii) the  Business Day  immediately  preceding  the
applicable Interest Payment Date or Stated Maturity, as the case may be.

The Notes of this series are issuable only in registered  form without coupon in
denominations of $250,000 and integral multiples of $1,000 in excess thereof.

This Note may be subject to  repayment  at the option of the  Registered  Holder
hereof on the Repayment Date(s) indicated on the face hereof. If no such date is
set forth on the face  hereof,  this Note may not be so repaid at the  option of
the Registered Holder hereof prior to maturity.  On each Repayment Date, if any,
this  Note  shall  be  repayable  in whole or in part in  increments  of  $1,000
(provided that any remaining principal hereof shall be at least $500,000) at the
option of the Registered Holder hereof at a repayment price equal to 100% of the
principal  amount to be repaid,  or if this Note is an Original  Issue  Discount
Note (as specified on the face hereof), the applicable Repayment Price specified
on the face hereof  together  in the case of any such  repayment  with  interest
thereon  payable to the Repayment Date, but interest  installments  due prior to
the  Repayment  Date will be payable to the  Registered  Holder on the  relevant
Regular  Record Date or special record date. For this Note to be repaid in whole
or   in   part   at   the   option   of   the    Registered    Holder    hereof,
_____________________________________,  as Fiscal and Paying  Agent,  at [insert
address];  Attention:  _______________  , or at such other  address of which the
Bank shall from time to time  notify the  Registered  Holder of the Notes,  must
receive not more than 45, nor less than 30, days prior to a Repayment  Date,  if
any,  either (i) this Note  accompanied  by the form  entitled  "Option to Elect
Repayment"  below  duly  completed,   or  (ii)  a  telegram,   telex,  facsimile
transmission  or letter from a member of a national  securities  exchange or the
National  Association of Securities Dealers,  Inc. or a commercial bank or trust
company in the United States of America setting forth the name of the Registered
Holder,  the principal amount of this Note, the principal amount of this Note to
be repaid, the certificate number or a description of the tenor and terms of the
Note, a statement that the option to elect repayment is being exercised  thereby
and a  guarantee  that the Note to be repaid with the form  entitled  "Option to
Elect  Repayment" on the Note duly  completed will be received by the Fiscal and
Paying Agent not later than five Business Days after the date of such  telegram,
telex,  facsimile  transmission  or letter and such Note and form duly completed
are received by the Fiscal and Paying Agent by such fifth Business Day. Exercise
of such repayment  option by the Registered  Holder hereof shall be irrevocable,
except a Registered  Holder  tendering after receipt of a notice of an extension
of maturity.

If so provided  on the face of this Note,  this Note may be redeemed by the Bank
on any Redemption  Date (or range of Redemption  Dates) so indicated on the face
hereof. If no Redemption Date (or range of Redemption Dates) is set forth on the
face hereof, this Note may not be redeemed prior to its Stated Maturity.  If one
or more Redemption Dates (or ranges of Redemption Dates) are so specified,  this
Note is  subject  to  redemption  at the  option  of the  Bank,  upon  notice by
first-class mail, not less than 30 nor more than 45 days prior to the Redemption
Date specified in such notice,  at the applicable  redemption price specified on
the face hereof (expressed as a percentage of the principal amount of this Note)
together  in the  case of any  such  redemption  with  accrued  interest  to the
Redemption Date, but interest installments due will be payable to the Registered
Holder on the relevant Regular Record Date if the Redemption Date is an Interest
Payment Date. The Bank may elect to redeem less than the entire principal amount
hereof;  provided,  that the principal amount, if any, of this Note that remains
outstanding after such redemption is an Authorized Denomination. In the event of
any redemption in part, the Bank will not be required to (i) issue, register the
transfer  of, or exchange  any Note during a period  beginning at the opening of
business 15 days before the day of the  mailing of the notice of  redemption  of
Notes selected for redemption and ending at the close of business on the date of
mailing of the relevant  notice of  redemption  or (ii) register the transfer or
exchange of any Note, or any portion thereof, called for redemption,  except the
unredeemed portion of any Note being redeemed in part.

Any money  deposited  with the Fiscal and  Paying  Agent for the  payment of the
principal of,  premium (if any) or interest on this Note that remains  unclaimed
for two years after such principal,  premium (if any) or interest has become due
and payable  shall be paid to the Bank and the Holder  shall  thereafter,  as an
unsecured general creditor,  look only to the Bank for payment thereof,  and all
liability  of the  Fiscal  and Paying  Agent  with  respect to such money  shall
thereupon cease.


<PAGE>



IN  WITNESS  WHEREOF,  the Bank has  caused  this Note to be duly  executed  and
countersigned as of the date set forth herein.

This Note is not valid for any  purpose  until  countersigned  by the Fiscal and
Paying Agent or such other  institution  as may be appointed by the Bank and the
certificate of authentication affixed hereon.


Countersigned for                             Trans Financial Bank,
                                              National Association
  authentication only

  as Fiscal and Paying Agent



By__________________________                  By__________________________
         Authorized Signature                        Authorized Signature



                                                              Attest:



                                                              ------------------
                                                                 Secretary


<PAGE>


                                              OPTION TO ELECT REPAYMENT

The  undersigned  hereby  irrevocably  request (s) and  instruct (s) the Bank to
repay the within Note (or portion thereof specified below) pursuant to its terms
at a price equal to the principal amount thereof,  together with interest to the
repayment date, to the undersigned, at


           (Please print or typewrite name and address of the Undersigned)

For this Note to be repaid the Fiscal and Paying  Agent must  receive at [insert
name and address]; Attention:  _______________, or at such other place or places
of which the  Company  shall  from time to time  notify the Holder of the within
Note,  not more than 45, nor less than 30,  days prior to a Repayment  Date,  if
any,  shown on the face of the  within  Note,  either  (i) this  Note  with this
"Option to Elect  Repayment"  form duly  completed,  or (ii) a telegram,  telex,
facsimile transmission or letter from a member of a national securities exchange
or the National Association of Securities Dealers,  Inc. or a commercial bank or
trust  company in the United  States of  America  setting  forth the name of the
Registered  Holder of the Note, the principal  amount of the Note, the principal
amount of the Note to be repaid,  the certificate number or a description of the
tenor and terms of the Note, a statement  that the option to elect  repayment is
being exercised thereby and a guarantee that the Note to be repaid with the form
entitled  "Option to Elect  Repayment"  duly  completed  will be received by the
Fiscal and Paying Agent not later than five Business Days after the date of such
telegram,  telex,  facsimile  transmission or letter and such Note and form duly
completed  are  received by the Fiscal and Paying  Agent by such fifth  Business
Day.

If less than the entire  principal  amount of the  within  Note is to be repaid,
specify the portion  thereof  (which shall be  increments  of $1,000)  which the
Holder  elects to have  repaid:  $________;  and  specify  the  denomination  or
denominations  (which  shall be $500,000  or an  integral  multiple of $1,000 in
excess of  $500,000)  of the Notes to be issued to the Holder for the portion of
the within Note not being repaid (in the absence of any such specification,  one
such Note will be issued for the portion not being repaid): $________.

Date:_______________                        ____________________________________
                                                     Note: The signature on this
                                                     Option  to Elect  Repayment
                                                     must  correspond  with  the
                                                     name as  written  upon  the
                                                     face of this  Note in every
                                                     particular          without
                                                     alteration or enlargement.


<PAGE>



                                              -------------------------
                                                    ABBREVIATIONS


The following  abbreviations,  when used in the  inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

                  TEN COM -- as tenants in common

                  TEN ENT -- as tenants by the entireties

                  JT ENT  -- as joint tenants and not as tenants in common
                                                                      Custodian
                  UNIF GIFT MIN ACT --
 ................................................................................
                                                              (Cust)    (Minor)
                                               under Uniform Gift to Minors Act

 ..............................................................................
                                                                        (State)

Additional abbreviations may be used though not in the above list.



FOR VALUE  RECEIVED the  undersigned  hereby sells,  assigns and transfers  unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE



(Name and address of assignee, including zip code, must be printed or
typewritten)



the within Note, and all rights thereunder, hereby irrevocably constituting and
 appointing



to  transfer  said Note on the books of the within  company,  with full power of
substitution in the premises.


Dated:


NOTICE:  The  signature  to this  assignment  must  correspond  with the name as
written upon the face of the within Note in every particular, without alteration
or  enlargement  or any change  whatever and must be  guaranteed by an "eligible
guarantor  institution" meeting the requirements of the Fiscal and Paying Agent,
which  requirements  include  membership or participation in STAMP or such other
"signature guaranty program" as may be determined by the Fiscal and Paying Agent
in  addition  to or in  substitution  for  STAMP,  all in  accordance  with  the
Securities Exchange Act of 1934, as amended.


<PAGE>


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

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





                                                        

                                 EXHIBIT B-2 TO
                                FISCAL AND PAYING
                                AGENCY AGREEMENT
                             (Medium-Term Floating)


UNLESS AND UNTIL IT IS EXCHANGED  IN WHOLE OR IN PART FOR NOTES IN  CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED  EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER  NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR  DEPOSITARY  OR A NOMINEE OF SUCH  SUCCESSOR  DEPOSITARY.  UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY  (55 WATER  STREET,  NEW YORK,  NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE  NAME OF CEDE & CO.  OR  SUCH  OTHER  NAME  AS  REQUESTED  BY AN  AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE &
CO.,  ANY  TRANSFER,  PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL  SINCE THE  REGISTERED  OWNER HEREOF,  CEDE & CO., HAS AN
INTEREST HEREIN.

[Senior Bank Note:  THIS BANK NOTE IS A DIRECT, UNCONDITIONAL, UNSECURED AND
UNSUBORDINATED GENERAL OBLIGATION OF
THE BANK.  THE OBLIGATION EVIDENCED BY THIS BANK NOTE RANKS PARI PASSU WITH ALL
OTHER UNSECURED AND
UNSUBORDINATED OBLIGATIONS OF THE BANK, EXCEPT OBLIGATIONS THAT ARE SUBJECT TO
ANY PRIORITIES OR PREFERENCES
UNDER APPLICABLE LAW, INCLUDING DEPOSIT OBLIGATIONS.]

[Subordinated Bank Note: "THE OBLIGATION EVIDENCED BY THIS BANK NOTE IS
UNSECURED AND IS SUBORDINATED AND JUNIOR
IN RIGHT OF PAYMENT TO THE BANK'S OBLIGATIONS TO ITS DEPOSITORS AND TO THE 
BANK'S OTHER OBLIGATIONS TO ITS
GENERAL AND SECURED CREDITORS AND IS INELIGIBLE AS COLLATERAL TO SECURE A LOAN
FROM THE BANK.]

THIS BANK NOTE DOES NOT  EVIDENCE A DEPOSIT  AND IS NOT  INSURED BY THE  FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR OTHER INSURER.


REGISTERED                                                           REGISTERED
No. FLR. _______________
CUSIP __________________


                                                 FLOATING RATE NOTE
                                     TRANS FINANCIAL BANK, NATIONAL ASSOCIATION


ORIGINAL ISSUE DATE:                        STATED MATURITY:


INITIAL INTEREST RATE:              SPREAD:


INDEX MATURITY:                     SPREAD MULTIPLIER:


INTEREST RATE BASIS:                        INTEREST ACCRUAL DATE:


MAXIMUM INTEREST RATE:              INTEREST DETERMINATION DATES:


MINIMUM INTEREST RATE:              CALCULATION DATE:


INTEREST RESET DATES:               REDEMPTION DATES:


REPAYMENT DATE(S):                          REDEMPTION PRICE:


REPAYMENT PRICE:                    OTHER REDEMPTION TERMS:


OTHER REPAYMENT TERMS:              OTHER TERMS:

If this Note was issued with "original  issue  discount" for purposes of Section
1273 of the Internal  Revenue Code of 1986, as amended,  the following  shall be
completed:

ORIGINAL ISSUE DISCOUNT NOTE:    TOTAL AMOUNT OF OID:    ISSUE PRICE (expressed 
                                                         as a percentage of
                                                    aggregate principal amount):
----

----
----
 Yes     No
-------------------------------------
--------------------

--------------------
--------------------
      14
YIELD TO MATURITY:      SHORT ACCRUAL PERIOD OID:     METHOD USED TO DETERMINE 
                                                      YIELD FOR SHORT
                                                      ACCRUAL PERIOD:
                                                                          --

                                                                          --
                                                                          --

                                                           Approximate   Exact
                                                      --------------------------
                                                      ------------------------

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

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


Trans Financial Bank, National  Association (the "Bank", which term includes any
successor  thereof)  for  value  received,  hereby  promises  to pay  the sum of
____________________  U.S.  dollars  ($________) to CEDE & CO. (the  "Registered
Holder") as nominee of The  Depository  Trust  Company  ("DTC") as custodian for
participants  each acting for themselves and as nominee or custodian for others,
including  trusts,  pension  and  retirement  plans and  accounts,  fiduciaries,
custodians and nominees (the  "Participants")  on the Stated Maturity and to pay
interest on a regular periodic basis as specified herein.

Interest  on this Note shall be payable  monthly,  quarterly,  semiannually,  or
annually  on each  Interest  Payment  Date  specified  herein  and on the Stated
Maturity specified herein at a rate per annum equal to the Initial Interest Rate
specified  herein until the first Interest Reset Date specified herein following
the Original Issue Date specified  herein and thereafter at a rate determined in
accordance  with the provisions  herein under the heading(s)  "Determination  of
Commercial Paper Rate",  "Determination  of Fed Funds Rate",  "Determination  of
LIBOR",  "Determination  of  Treasury  Rate",  "Determination  of  Prime  Rate",
"Determination  of J.J.  Kenny Rate",  "Determination  of 11th  District Cost of
Funds Rate" or "Determination of CMT Rate",  depending upon whether the Interest
Rate Basis is Commercial Paper Rate, Fed Funds Rate, LIBOR, Treasury Rate, Prime
Rate,  J.J.  Kenny  Rate,  11th  District  Cost of Funds Rate or CMT Rate to the
person in whose name this Note is  registered  at the close of  business  on the
Regular Record Date whether or not a Business Day (as defined herein); provided,
however, that if the Original Issue Date is between a Regular Record Date and an
Interest Payment Date,  interest  payments will commence on the Interest Payment
Date following the next succeeding  Regular Record Date; and provided,  further,
that if an Interest Payment Date or Interest Reset Date would fall on a day that
is not a Business Day, such Interest  Payment Date or Interest  Reset Date shall
be the following  day that is a Business  Day,  except that if the Interest Rate
Basis is LIBOR,  where such  following  Business Day falls in the next  calendar
month,  such  Interest  Payment  Date or  Interest  Reset Date shall be the next
preceding day that is a Business Day. "Business Day" means any day that is not a
Saturday  or  Sunday  and that is not a day on which  banking  institutions  are
authorized  or obligated  by law or executive  order to close in the City of New
York or the City of Bowling Green,  Kentucky; or with respect to LIBOR Notes, is
also a  London  Business  Day.  "London  Business  Day"  means  any day on which
dealings in deposits in U.S.  dollars  are  transacted  in the London  interbank
market.

Principal,  premium,  if any,  and  interest  payments  on Notes will be made in
immediately available funds to the Registered Holder.

The Registered Holders may declare the principal amount of, and accrued interest
on,  this Note to be due and  payable  immediately  if an Event of Default  with
respect to the Note shall have  occurred and be  continuing  at the time of such
declaration. Any Event of Default with respect to this Note may be waived by the
Registered Holder.

[Senior Bank Notes:  For purposes of this Note, an "Event of Default" shall
 mean any one of the following events:



<PAGE>


-------------------------------------------------------------------------------
                  default in the payment of any  interest  upon the Note when it
                  becomes due and payable, and continuance of such default for a
                  period of 30 days; or
-------------------------------------------------------------------------------

                            default in the payment of the principal of (or
                  premium, if any, on) the Note when
                  due; or

                            default  in  the  performance  of  any  covenant  or
                  agreement of the Bank  contained  in the Note which  continues
                  for 60 days  after  receipt  of  written  notice  given by the
                  Registered Holder; or

                            the  Bank  shall  consent  to the  appointment  of a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar official in any insolvency, receivership, liquidation,
                  readjustment of debt,  marshaling of assets and liabilities or
                  similar  proceedings  of or  relating  to  the  Bank  or of or
                  relating to all or  substantially  all of its  property;  or a
                  decree or order of a court or agency or supervisory  authority
                  having  jurisdiction  in the premises for the appointment of a
                  conservator  or  receiver  or  liquidator  or trustee or other
                  similar official in any insolvency, receivership,  liquidation
                  readjustment of debt,  marshaling of assets and liabilities or
                  similar  proceedings,  or for the winding-up or liquidation of
                  its affairs, shall have been entered against the Bank and such
                  decree or order shall have remained in force  undischarged  or
                  unstayed  for a period  of 60  consecutive  days;  or the Bank
                  shall  file a petition  to take  advantage  of any  applicable
                  insolvency or reorganization statute.]

[Subordinated  Bank Notes:  "For  purposes  of this Note,  an "Event of Default"
shall occur if the Bank shall consent to the  appointment  of a  conservator  or
receiver or liquidator or trustee or other similar  official in any  insolvency,
readjustment   of  debt,   marshaling  of  assets  and  liabilities  or  similar
proceedings of or relating to the Bank or of or relating to all or substantially
all of its  property;  or a decree or order of a court or agency or  supervisory
authority  having  jurisdiction  in  the  premises  for  the  appointment  of  a
conservator  or receiver or liquidator  or trustee or other similar  official in
any insolvency,  readjustment  of debt,  marshaling of assets and liabilities or
similar proceedings,  or for the winding-up or liquidation of its affairs, shall
have been entered  against the Bank and such decree or order shall have remained
in force  undischarged  or unstayed for a period of 60 consecutive  days; or the
Bank shall file a petition to take  advantage of any  applicable  insolvency  or
reorganization statute.]

The holder of this Note, by its acceptance hereof,  agrees that the indebtedness
of the Bank  evidenced by this Note,  including the  principal and interest,  is
unsecured  and  subordinate  and  junior  in  right  of  payment  to the  Bank's
obligations to its depositors,  its obligations  under banker's  acceptances and
letters of credit,  and its  obligations to its other  creditors  (including any
obligations to any Federal  Reserve Bank and the FDIC),  whether  outstanding at
the time this Note is issued or  thereafter  incurred  (except  any  obligations
which by their express  terms rank on a parity with or junior to this Note),  in
that in the case of any insolvency proceedings,  receivership,  conservatorship,
reorganization,  readjustment of debt,  marshalling of assets and liabilities or
similar proceedings or any liquidation or winding up of or relating to the Bank,
whether voluntary or involuntary, all such obligations (except obligations which
rank on a parity  with or junior to this Note)  shall be  entitled to be paid in
full before any payment shall be made on account of the principal of or interest
on this Note. In the event of any such proceeding,  after payment in full of all
sums owing with  respect  to such  prior  obligations,  the holder of this Note,
together  with the holders of any  obligations  of the Bank  ranking on a parity
with this Note,  shall be entitled to be paid pro rata from the remaining assets
of the Bank the unpaid  principal  of, and the unpaid  interest on, this Note or
such other  obligations  before any  payment or other  distribution,  whether in
cash, property,  or otherwise,  shall be made on account of any capital stock or
any obligations of the Bank ranking junior to this Note.

This Note contains no limitation on the amount of senior debt, deposits or other
obligations  that rank  senior to this Note that may be  hereafter  incurred  or
assumed by the Bank.]

All notices to the Bank under this Note shall be in writing or  addressed to the
Fiscal   and   Paying   Agent  at   [insert   name  and   address];   Attention:
__________________,  or to  such  other  address  as the  Bank  may  notify  the
Registered Holder.

This Note shall be governed by and construed in accordance  with the laws of the
State of New York.

No interest will accrue on this Note after its maturity.

Interest:

Interest  payable with respect to each interest  payment  period shall accrue to
but not include the applicable Interest Payment Date or the Stated Maturity,  as
the case may be.  Accrued  interest  hereon from the Issue Date or from the last
date to which  interest  shall have been paid,  as the case may be,  shall be an
amount  calculated by multiplying the face amount hereof by an accrued  interest
factor.  Such accrued  interest  factor shall be computed by adding the interest
factors  calculated  for each day from the Original  Issue Date or from the last
date to which interest shall have been paid, as the case may be, to the date for
which accrued  interest is being  calculated.  The interest factor for each such
day shall be computed by dividing the interest  rate  applicable  to such day by
360 if the Interest Rate Basis is Commercial Paper Rate, Fed Funds Rate,  LIBOR,
Prime Rate,  J.J.  Kenny Rate or 11th  District Cost of Funds Rate, as indicated
herein,  or by the actual  number of days in the year if the Interest Rate Basis
is the Treasury Rate or CMT Rate, as indicated herein.

The rate of interest  borne by this Note will be reset daily,  weekly,  monthly,
quarterly,  semiannually or annually,  as specified  above.  The "Interest Reset
Date" will be the date specified above; provided, however, that (i) the interest
rate in effect from the  Original  Issue Date to the first  Interest  Reset Date
will be the "Initial  Interest Rate" (as specified herein) and (ii) the interest
rate in effect for the ten days immediately  prior to the Stated Maturity,  will
be that in effect on the tenth day preceding such date.  Each such adjusted rate
shall be  applicable  on and after the Interest  Reset Date to which it relates,
to, but not  including,  the next  succeeding  Interest Reset Date, or until the
Stated Maturity,  as the case may be. If any Interest Reset Date would otherwise
be a day that is not a Business Day, such Interest Reset Date shall be postponed
to the next  succeeding day that is a Business Day, except that in the case of a
LIBOR Note, where such following Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the immediately preceding Business Day.

Determination of Commercial Paper Rate:

If the Interest Rate Basis specified on the face hereof is the Commercial  Paper
Rate,  the interest  rate with respect to this Note for any Interest  Reset Date
shall be the  Commercial  Paper Rate plus or minus the  Spread,  if any,  and/or
multiplied by the Spread Multiplier, if any, as specified on the face hereof, as
determined on the applicable Interest Determination Date.

"Commercial Paper Rate" means, with respect to any Interest  Determination Date,
the Money Market Yield  (calculated as described  below) of the rate quoted on a
discount  basis on that date for  commercial  paper  having  the Index  Maturity
specified on the face hereof as made available and subsequently published by the
Board of  Governors of the Federal  Reserve  System (the  "Federal  Reserve") in
"Statistical  Release  H.15(519),  Selected  Interest  Rates"  or any  successor
publication ("H.15(519)") under the heading "Commercial Paper". If by 3:00 p.m.,
New York City time, on the Calculation  Date (as defined below) such rate is not
yet made  available  by the Federal  Reserve nor made  available  by the Federal
Reserve Bank of New York (the "New York Fed"),  then the  Commercial  Paper Rate
shall be the Money Market Yield on such Interest  Determination Date of the rate
of  commercial  paper of the  Index  Maturity  specified  on the face  hereof as
published by the New York Fed in its daily statistical release,  "Composite 3:30
P.M. Quotations for U.S. Government Securities"  ("Composite  Quotations") under
the heading  "Commercial  Paper" prior to 3:00 P.M., New York City Time. If such
rate is neither published in H.15(519) nor in Composite  Quotations by 3:00 P.M.
New York City time, on the Calculation  Date, the Commercial Paper Rate for that
Interest  Determination  Date shall be calculated by the  Calculation  Agent (as
defined below) and shall be the Money Market Yield of the arithmetic  mean (each
as rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage  point) of the offered rates of three  leading  dealers of commercial
paper in the  City of New York  selected  by the  Calculation  Agent as of 11:00
a.m.,  New York City time, on that Interest  Determination  Date, for commercial
paper having such Index  Maturity  placed for an industrial  issuer whose senior
unsecured  bond rating is "AA" or the  equivalent  from a nationally  recognized
securities  rating agency;  provided,  however,  that if the dealers selected as
aforesaid  by the  Calculation  Agent  are  not  quoting  as  mentioned  in this
sentence,  the Commercial Paper Rate with respect to such Interest Determination
Date will be the Commercial Paper Rate in effect on such Interest  Determination
Date.

"Money  Market  Yield"  shall  be a yield  (expressed  as a  percentage  rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point) calculated in accordance with the following formula:

                                                               D x 360
                               Money Market Yield = ..................... x 100
                                                           360 - (D x M)

where "D" refers to the per annum  rate for the  commercial  paper,  quoted on a
bank  discount  basis and  expressed as a decimal,  and "M" refers to the actual
number of days in the interest period for which interest is being calculated.

Determination of Fed Funds Rate:

If the Interest  Rate Basis  specified on the face hereof is the Fed Funds Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the Fed Funds Rate plus or minus the Spread,  if any,  and/or  multiplied by the
Spread Multiplier, if any, as specified on the face hereof, as determined on the
applicable Interest Determination Date.

"Fed Funds Rate" means,  with respect to any Interest  Determination  Date,  the
rate on that day for Federal  Funds having the Index  Maturity  specified on the
face hereof as made available and subsequently  published in H.15(519) under the
heading "Federal Funds  (Effective)." In the event that such rate is not so made
available by 3:00 p.m., New York City time, on the  Calculation  Date pertaining
to such Interest Determination Date, the Fed Funds Rate will be the rate on such
Interest  Determination  Date  for  Federal  Funds  having  the  Index  Maturity
specified on the face hereof as is made available and subsequently  published in
Composite Quotations under the heading "Federal  Funds/Effective  Rate." If such
rate is neither made available by the Federal  Reserve nor made available by the
New  York  Fed by 3:00  p.m.,  New  York  City  time,  on the  Calculation  Date
pertaining  to such  Interest  Determination  Date,  the Fed Funds Rate for such
Interest Determination Date will be calculated by the Calculation Agent and will
be the arithmetic mean (rounded  upwards,  if necessary,  to the next higher one
hundred-thousandth  of a percentage point) of the rates for the last transaction
in overnight  Federal funds  arranged by three leading  brokers of Federal funds
transactions  in the City of New York  selected by the  Calculation  Agent as of
9:00 a.m., New York City time, on such Interest  Determination  Date;  provided,
however,  that if the brokers selected as aforesaid by the Calculation Agent are
not quoting as  mentioned in this  sentence,  the Fed Funds Rate will be the Fed
Funds Rate in effect on such Interest Determination Date.

Determination of LIBOR:

If the Interest Rate Basis  specified on the face hereof is LIBOR,  the interest
rate with respect to this Note for any  Interest  Reset Date shall be LIBOR plus
or minus the Spread, if any, or multiplied by the Spread Multiplier,  if any, as
specified  on  the  face  hereof,  as  determined  on  the  applicable  Interest
Determination Date.

"LIBOR" will be determined by the Calculation Agent in accordance with the
following provisions:

                    LIBOR will be, as specified  on the face hereof,  either (i)
         the arithmetic  mean of the offered rates for deposits in U.S.  dollars
         having the Index Maturity  designated on the face hereof  commencing on
         the  second  London  Business  Day  immediately  following  that  LIBOR
         Interest  Determination  Date,  that appear on the Reuters  Screen LIBO
         Page  as  of  11:00  A.M.,   London  time,   on  that  LIBOR   Interest
         Determination  Date,  if at least two such offered  rates appear on the
         Reuters  Screen  LIBO  Page  ("LIBOR  Reuters"),  or (ii)  the rate for
         deposits in U.S.  dollars having the Index  Maturity  designated on the
         face hereof  commencing on the second London  Business Day  immediately
         following that LIBOR Interest  Determination  Date, that appears on the
         Telerate  Page  3750,  as of 11:00  A.M.,  London  time,  on that LIBOR
         Interest  Determination Date ("LIBOR  Telerate").  "Reuters Screen LIBO
         Page"  means the  display  designated  as page  "LIBO"  on the  Reuters
         Monitor Money Rates Service (or such other page as may replace the LIBO
         page on that  service for the purpose of  displaying  London  interbank
         offered rates of major banks).  "Telerate  Page 3750" means the display
         designated  as page "3750" on the Telerate  Service (or such other page
         as may replace the 3750 page on that  service or such other  service or
         services as may be nominated by the British  Bankers'  Association  for
         the  purpose of  displaying  London  interbank  offered  rates for U.S.
         dollar  deposits).  If neither  LIBOR  Reuters  nor LIBOR  Telerate  is
         specified in the  Book-Entry  Bank Note  representing  such LIBOR Note,
         LIBOR will be determined as if LIBOR  Telerate has been  specified.  If
         fewer than two offered rates appear on the Reuters Screen LIBO Page, or
         if no rate appears on the Telerate Page 3750, as  applicable,  LIBOR in
         respect of that LIBOR Interest Determination Date will be determined as
         if the parties had specified the rate described in (b) below.

           With respect to a LIBOR Interest Determination Date on which
         fewer than two offered
         rates  appear on the Reuters  Screen LIBO Page,  as specified in (a)(i)
         above,  or on which no rate appears on Telerate Page 3750, as specified
         in (a)(ii) above, as applicable,  LIBOR will be determined on the basis
         of the  rates  at which  deposits  in U.S.  dollars  having  the  Index
         Maturity  designated  on the face hereof are  offered at  approximately
         11:00 A.M., London time, on that LIBOR Interest  Determination  Date by
         four  major  banks  in the  London  interbank  market  selected  by the
         Calculation  Agent  ("LIBOR  Reference  Banks")  to prime  banks in the
         London  interbank  market  commencing on the second London Business Day
         immediately  following that LIBOR Interest  Determination Date and in a
         principal amount equal to an amount of not less than $1,000,000 that is
         representative  for a single  transaction  in such market at such time.
         The Calculation  Agent will request the principal London office of each
         of the LIBOR  Reference Banks to provide a quotation of its rate. If at
         least two such quotations are provided,  LIBOR in respect of that LIBOR
         Interest  Determination  Date  will  be the  arithmetic  mean  of  such
         quotations. If fewer than two quotations are provided, LIBOR in respect
         of that LIBOR Interest  Determination  Date will be the arithmetic mean
         of the rates quoted at approximately 11:00 A.M., New York City time, on
         that LIBOR Interest Determination Date by three major banks in The City
         of New York selected by the Calculation Agent for loans in U.S. dollars
         to leading  European banks having the Index Maturity  designated on the
         face hereof  commencing on the second London  Business Day  immediately
         following  that LIBOR  Interest  Determination  Date and in a principal
         amount  equal  to an  amount  of  not  less  than  $1,000,000  that  is
         representative  for a single  transaction  in such market at such time;
         provided,  however,  that if the banks  selected  as  aforesaid  by the
         Calculation Agent are not quoting as mentioned in this sentence,  LIBOR
         with respect to such LIBOR Interest Determination Date will be the rate
         of LIBOR in effect on such date.

Determination of Treasury Rate:

If the Interest  Rate Basis  specified on the face hereof is the Treasury  Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the Treasury  Rate plus or minus the Spread,  if any,  and/or  multiplied by the
Spread Multiplier, if any, as specified on the face hereof, as determined on the
applicable Interest Determination Date.

"Treasury Rate" means, with respect to any Interest Determination Date, the rate
for  the  most  recent  auction  of  direct  obligations  of the  United  States
("Treasury  Bills")  having the Index  Maturity  specified on the face hereof as
published in H.15(519)  under the heading "U.S.  Government  Securities/Treasury
Bills/Auction  Average  (Investment)" or, if not so made available by 3:00 p.m.,
New  York  City  time,  on the  Calculation  Date  pertaining  to such  Interest
Determination Date the auction average rate (expressed as a bond equivalent,  on
the basis of a year of 365 or 366 days,  as  applicable,  and applied on a daily
basis)  for  such  auction  or as  otherwise  announced  by  the  United  States
Department of the Treasury by 3:00 p.m., New York City time, on such Calculation
Date. In the event that the results of the auction of Treasury  Bills having the
Index  Maturity  specified on the face hereof are neither made  available by the
Federal  Reserve nor otherwise  published or reported as provided  above by 3:00
p.m., New York City time, on such Calculation Date or no such auction is held in
a particular week, then the Treasury Rate shall be calculated by the Calculation
Agent and shall be a yield to maturity (expressed as a bond equivalent,  rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point, on the basis of a year of 365 or 366 days, as applicable,  and applied on
a daily basis) of the arithmetic  mean of the secondary  market bid rates, as of
3:30 p.m.,  New York City time,  on such Interest  Determination  Date, of three
leading  primary United States  government  securities  dealers  selected by the
Calculation  Agent,  for the issue of Treasury  Bills with a remaining  maturity
closest to the Index Maturity specified on the face hereof;  provided,  however,
that if the  dealers  selected as  aforesaid  by the  Calculation  Agent are not
quoting as mentioned in this  sentence,  the Treasury  Rate with respect to such
Interest Determination Date will be the Treasury Rate in effect on such Interest
Determination Date.

Determination of Prime Rate:

If the Interest Rate Basis  specified on the face hereof is the Prime Rate,  the
interest rate with respect to this Note for any Interest Reset Date shall be the
Prime Rate plus or minus the Spread,  if any,  and/or  multiplied  by the Spread
multiplier,  if any, as  specified  on the face  hereof,  as  determined  on the
applicable Interest Determination Date.

"Prime  Rate" for each such  Interest  Reset Date will be  determined  as of the
Prime  Rate  Interest  Determination  Date and will be the rate as such  rate is
published in H.15(519)  under the heading "Bank Prime Loan." If such rate is not
published  prior to 3:00 P.M.,  New York City time,  on the related  Calculation
Date,  then the Prime Rate shall be the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen NYMF Page (as
defined  below) as such bank's  prime rate or base lending rate as in effect for
such Prime Rate Interest  Determination  Date. If fewer than four such rates but
more than one such rate  appear on the  Reuters  Screen NYMF Page for such Prime
Rate Interest Determination Date, the Prime Rate shall be the arithmetic mean of
the prime  rates  quoted on the basis of the  actual  number of days in the year
divided  by a  360-day  year as of the  close of  business  on such  Prime  Rate
Interest  Determination Date by three, or two if only two such rates are quoted,
major money center  banks in The City of New York (which may include  affiliates
of certain of the Agents)  selected by the Calculation  Agent. If fewer than two
such  rates  appear on the  Reuters  Screen  NYMF  Page,  the Prime Rate will be
determined by the  Calculation  Agent on the basis of the rates furnished in The
City of New York by three, or two if only two such rates are quoted,  substitute
banks or trust  companies  organized  and doing  business  under the laws of the
United  States,  or any state  thereof,  having total equity capital of at least
$500 million and being subject to supervision or examination or state authority,
selected  by the  Calculation  Agent to  provide  such rate or rates;  provided,
however,  that if  fewer  than  two such  substitute  banks  or trust  companies
selected as aforesaid are quoting as mentioned in this sentence,  the Prime Rate
determined as of such Prime Rate Interest  Determination Date shall be the Prime
Rate in effect on such Prime Rate Interest Determination Date.

"Reuters  Screen NYMF Page" means the display  designated  as page "NYMF" on the
Reuters  Monitor Money Rates Service (or such other page as may replace the NYMF
page on that service for the purpose of  displaying  prime rates or base lending
rates of major United States banks).

Determination of J.J. Kenny Rate:

If the Interest Rate Basis  specified on the face hereof is the J.J. Kenny Rate,
the interest rate with respect to this Note for any Interest Reset Date shall be
the J.J. Kenny Rate plus or minus the Spread,  if any, and/or  multiplied by the
Spread Multiplier, if any, as specified on the face hereof, as determined on the
applicable Interest Determination Date.

"J.J.  Kenny Rate" means the rate in the high grade  weekly  index (the  "Weekly
Index") on such date made available by Kenny  Information  Systems  ("Kenny") to
the  Calculation  Agent.  The Weekly  Index is, and shall be,  based upon 30-day
yield  evaluations at par of bonds, the interest of which is exempt from Federal
income taxation under the Internal Revenue Code of 1986, as amended, of not less
than five high grade  component  issuers  selected by Kenny which shall include,
without  limitation,  issuers of general  obligation bonds. The specific issuers
included  among the component  issuers may be changed from time to time by Kenny
in its  discretion.  The  bonds on which  the  Weekly  Index is based  shall not
include  any bonds on which the  interest is subject to a minimum tax or similar
tax under the Internal  Revenue Code of 1986, as amended,  unless all tax-exempt
bonds are subject to such tax. In the event Kenny ceases to make  available such
Weekly Index,  a successor  indexing  agent will be selected by the  Calculation
Agent,  such index to reflect the prevailing rate for bonds rated in the highest
short-term  rating category by Moody's  Investors  Service,  Inc. and Standard &
Poor's  Corporation in respect of issuers most closely resembling the high grade
component  issuers selected by Kenny for its Weekly Index, the interest on which
is (A) variable on a weekly basis, (B) exempt from Federal income taxation under
the Internal Revenue Code of 1986, as amended,  and (C) not subject to a minimum
tax or  similar  tax under the  Internal  Revenue of Code of 1986,  as  amended,
unless all tax-exempt bonds are subject to such tax. If such successor  indexing
agent is not available, the rate for any J.J. Kenney Interest Determination Date
shall  be 67% of the  rate  determined  if the  Treasury  Rate  option  had been
originally  selected.  The Calculation Agent shall calculate the J.J. Kenny Rate
in accordance with the foregoing.

Determination of 11th District Cost of Funds Rate:

If the Interest  Rate Basis  specified  on the face hereof is the 11th  District
Cost of Funds Rate, the interest rate with respect to this Note for any Interest
Reset  Date  shall be the 11th  District  Cost of Funds  Rate  plus or minus the
Spread, if any, and/or multiplied by the Spread Multiplier, if any, as specified
on the face hereof, as determined on the applicable Interest Determination Date.

Unless otherwise indicated in an applicable  supplement to the Offering Circular
or on the Book-Entry Bank Note  representing an 11th District Cost of Funds Rate
Note,  "11th  District  Cost of Funds  Rate"  means,  with  respect  to any 11th
District Cost of Funds  Interest  Determination  Date, the monthly 11th District
Cost of Funds Index (the "11th  District  Cost of Funds  Index")  normally  made
available  and  subsequently  published  by the  Federal  Home  Loan Bank of San
Francisco (the "FHLB of San Francisco")  during the month immediately  preceding
the  Interest  Reset Date to which  such 11th  District  Cost of Funds  Interest
Determination Date applies.

The 11th District Cost of Funds Index is normally made  available by the FHLB of
San  Francisco  on the last day on which the FHLB of San  Francisco  is open for
business in each month and represents the monthly weighted average cost of funds
for savings  institutions  in the 11th  District  of the Federal  Home Loan Bank
system  for the month  preceding  the month in which the 11th  District  Cost of
Funds Index is made available.  Currently, the 11th District Cost of Funds Index
is computed by the FHLB of San  Francisco for each month by dividing the cost of
funds (interest paid during the month by 11th District  savings  institutions on
savings,  advances  and other  borrowing)  by the average of the total amount of
those  funds  outstanding  at the end of that  month  and the  prior  month  and
annualizing and adjusting the result to reflect the actual number of days in the
particular  month.  If  necessary,  before  these  calculations  are  made,  the
component  figures are adjusted by the FHLB of San Francisco to  neutralize  the
effect of events  such as  member  institutions  leaving  the 11th  District  or
acquiring institutions outside the 11th District.

If the FHLB of San Francisco  shall fail in any month to make available the 11th
District Cost of Funds Index (each such failure  being  referred to herein as an
"Alternate  Rate  Event"),  then the 11th  District  Cost of Funds  Rate for the
Interest  Determination  Date after the Alternate Rate Event shall be calculated
on the  basis of the  11th  District  Cost of Funds  Index  most  recently  made
available prior to such Interest  Determination Date. If an Alternate Rate Event
occurs in the month  immediately  following  a month in which a prior  Alternate
Rate Event occurred,  then the 11th District Cost of Funds Rate for the Interest
Determination  Date immediately  following the second Alternate Rate Event shall
be  calculated  on the  basis of the 11th  District  Cost of  Funds  Index  most
recently  made  available  prior to such 11th  District  Cost of Funds  Interest
Determination  Date and,  thereafter,  the 11th  District Cost of Funds Rate for
each succeeding Interest Determination Date shall be LIBOR, determined as though
the  Interest  Rate Basis  were LIBOR and the Spread  shall be plus or minus the
number of basis points  specified in the applicable  11th District Cost of Funds
Rate Note as the "Alternate Rate Event Spread", if any.

In  determining  that the FHLB of San  Francisco has failed in any month to make
available the 11th District Cost of Funds Index, the Calculation  Agent may rely
conclusively  on any  written  advice  from  the FHLB of San  Francisco  to such
effect.

Determination of CMT Rate:

If the Interest  Rate Basis  specified  on the face hereof is the CMT Rate,  the
interest rate with respect to this Note for any Interest Reset Date shall be the
CMT Rate plus or minus the  Spread,  if any,  and/or  multiplied  by the  Spread
Multiplier,  if any, as  specified  on the face  hereof,  as  determined  on the
applicable Interest Determination Date.

"CMT Rate" means, with respect to any CMT Interest Determination Date, the
rate displayed on the Designated CMT
Telerate Page (as defined below) under the caption ". . . Treasury Constant
Maturities . . . Federal Reserve
Board Release H.15 . . . Mondays Approximately 3:45 P.M.," under the column for
the Designated CMT Maturity Index
as defined below) for (i) if the Designated CMT Telerate Page is 7055, the
rate on such CMT Interest
Determination Date and (ii) if the Designated CMT Telerate Page is 7052, 
the week, or the month, as applicable,
ended immediately preceding the week in which the applicable CMT Interest
Determination Date occurs.  If such
rate is no longer displayed on the relevant page, or if not displayed by 3:00
P.M., New York City time, on the
Calculation Date pertaining to such CMT Interest Determination Date, then the
CMT Rate for such CMT Interest
Determination Date will be such treasury constant maturity rate for the 
Designated CMT Maturity Index as
published in the relevant H.15(519).  If such rate is no longer published, 
or if not published by 3:00 P.M., New
York City time, on the Calculation Date pertaining to such CMT Interest
Determination Date, then the CMT Rate for
such CMT Interest Determination Date will be such treasury constant maturity
rate for the Designated CMT Maturity
Index (or other United States Treasury rate for the Designated CMT Maturity
 Index) for the CMT Interest
Determination Date with respect to such Interest Reset Date as may then 
be published by either the Federal
Reserve Board or the United States Department of the Treasury that the
 Calculation Agent determines to be
comparable to the rate formerly displayed on the Designated CMT Telerate
Page and published in the relevant
H.15(519).  If such information is not provided by 3:00 P.M., New York City
 time, on the Calculation Date
pertaining to such CMT Interest Determination Date, then the CMT Rate for the
 CMT Interest Determination Date
will be calculated by the Calculation Agent and will be a yield to maturity,
 based on the arithmetic mean of the
secondary market closing offer side prices as of approximately 3:30 P.M., 
New York City time, on the CMT Interest
Determination Date reported, according to their written records, by three
 leading primary United States
government securities dealers (each, a "Reference Dealer") in The City of
New York selected by the Calculation
Agent (from five such Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation
(or, in the event of equality, one of the highest) and the lowest quotation
(or, in the event of equality, one of
the lowest)), for the most recently issued direct noncallable fixed rate 
obligations of the United States
("Treasury Notes") with an original maturity of approximately the Designated 
CMT Maturity Index and a remaining
term to maturity of not less than such Designated CMT Maturity Index minus
one year.  If the Calculation Agent
cannot obtain three such Treasury Note quotations, the CMT Rate for such 
CMT Interest Determination Date will be
calculated by the Calculation Agent and will be a yield to maturity based
on the arithmetic mean of the secondary
market offer side prices as of approximately 3:30 P.M., New York City time,
on the Interest Determination Date of
three Reference Dealers in The City of New York (from five such Reference
Dealers selected by the Calculation
Agent and eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest)), for Treasury
Notes with an original maturity of the
number of years that is the next highest to the Designated CMT Maturity Index
and a remaining term to maturity
closest to the Designated CMT Maturity Index and in an amount of at least
$100,000,000.  If three or four (and
not five) of such Reference Dealers are quoting as described above, then the
CMT Rate will be based on the
arithmetic mean of the offer prices obtained and neither the highest nor the
lowest of such quotes will be
eliminated; provided however, that if fewer than three Reference Dealers
selected by the Calculation Agent are
quoting as described herein, the CMT Rate will be the CMT Rate in effect
on such Interest Determination Date.  If
two Treasury Notes with an original maturity as described in the third 
preceding sentence, have remaining terms
to maturity equally close to the Designated CMT Maturity Index, the quotes for
the CMT Rate Note with the shorter
remaining term to maturity will be used.

"Designated  CMT  Telerate  Page"  means the  display on the Dow Jones  Telerate
Service on the page  specified  in the  applicable  supplement  to the  Offering
Circular or herein,  (or any other page as may replace such page on that service
for the purpose of  displaying  Treasury  Constant  Maturities  as  published in
H.15(519)),  for the  purpose of  displaying  Treasury  Constant  Maturities  as
published  in  H.15(519).  If no  such  page  is  specified  in  the  applicable
supplement to the Offering Circular or herein,  the Designated CMT Telerate Page
shall be 7052, for the most recent week.

"Designated  CMT Maturity  Index"  means the original  period to maturity of the
Treasury  Notes (either one, two,  three,  five,  seven,  ten,  twenty or thirty
years)  specified  in the  applicable  supplement  to the  Offering  Circular or
herein,  with  respect  to which  the CMT Rate  will be  calculated.  If no such
maturity is specified in the applicable  supplement to the Offering  Circular or
herein, the Designated CMT Maturity Index shall be two years.

General

Notwithstanding  the  determination  of the interest rate as provided above, the
interest rate on this Note for any interest period shall not be greater than the
Maximum  Interest Rate, if any,  and/or less than the Minimum  Interest Rate, if
any,  specified  on the face hereof.  The interest  rate on this Note will in no
event be higher than the maximum rate permitted  under  applicable  state law as
the same may be modified by United States law of general application.

The  Calculation  Agent will,  upon the request of the beneficial  owner of this
Note, provide the interest rate then in effect and, if determined,  the interest
rate  which  will  become  effective  as a result of a  determination  made with
respect to the most  recent  Interest  Determination  Date with  respect to this
Note. Unless changed by the Bank, in its sole discretion,  the Fiscal and Paying
Agent will act as Calculation Agent for this Note and thereafter the Calculation
Agent  shall be such agent as selected  by the Bank.  The Bank shall  notify the
Registered  Holder and the Depository Trust Company of any change in Calculation
Agent.

The Interest Determination Date pertaining to an Interest Reset Date will be the
second  Business Day preceding such Interest Reset Date for all Notes other than
Notes  with an  Interest  Reset  Basis  of LIBOR or the  Treasury  Rate.  If the
Interest  Rate  Basis  specified  on the face  hereof  is  LIBOR,  the  Interest
Determination  Date  pertaining  to an  Interest  Reset  Date will be the second
London  Business Day next  preceding  such Interest  Reset Date. If the Interest
Rate Basis  specified  on the face hereof is the  Treasury  Rate,  the  Interest
Determination  Date  pertaining to an Interest Reset Date will be the day of the
week in which  such  Interest  Reset Date falls on which  Treasury  Bills  would
normally be auctioned (generally,  Monday). If as the result of a legal holiday,
an auction is held on the  preceding  Friday,  such Friday will be the  Interest
Determination  Date  pertaining to the Interest Reset Date occurring in the next
succeeding  week. If an auction date shall fall on any Interest Reset Date for a
Treasury  Rate Note,  then such  Interest  Reset Date shall instead be the first
Business Day immediately following such auction.

All dollar amounts used in or resulting from any calculation  will be rounded to
the nearest cent with  one-half  cent being  rounded  upward.  Unless  otherwise
specified  herein,  all  percentages  resulting  from  any  calculation  will be
rounded, if necessary,  to the nearest one-hundred thousandth of a percent, with
five one-millionths of a percent rounded upwards, e.g., 9.876545% (or .09876545)
being  rounded to 9.87655% (or .0987655)  and  9.876544%  (or  .09876544)  being
rounded to 9.87654% or .0987654).

The   "Calculation   Date",   where   applicable,   pertaining  to  an  Interest
Determination  Date is the  earlier  of (i) the tenth  calendar  day after  such
Interest  Determination  Date,  or if such day is not a Business  Day,  the next
succeeding  Business  Day or (ii) the  Business Day  immediately  preceding  the
applicable Interest Payment Date, Stated Maturity,  Redemption Date or Repayment
Date as the case may be.

The Notes of this series are issuable only in registered form without coupons in
denominations of $250,000 and integral multiples of $1,000 in excess thereof.

[THIS NOTE IS NOT SUBJECT TO REDEMPTION OR PREPAYMENT PRIOR TO MATURITY.]

[Senior  Bank Notes:  This Note may be subject to repayment at the option of the
Registered  Holder hereof on the Repayment Date(s) indicated on the face hereof.
If no such date is set forth on the face hereof,  this Note may not be so repaid
at the option of the Registered Holder hereof prior to Stated Maturity.  On each
Repayment  Date,  if any,  this Note shall be  repayable  in whole or in part in
increments of $1,000  (provided that any remaining  principal hereof shall be at
least  $500,000) at the option of the  Registered  Holder  hereof at a repayment
price equal to 100% of the principal amount to be repaid,  or if this Note is an
Original Issue  Discount Note (as specified on the face hereof),  the applicable
Repayment  Price  specified on the face hereof  together in the case of any such
repayment  with interest  thereon  payable to the Repayment  Date,  but interest
installments  due prior to the Repayment  Date will be payable to the Registered
Holder on the relevant Regular Record Date or special record date. For this Note
to be repaid in whole or in part at the option of the Registered  Holder hereof,
_______________,  as Fiscal  and  Paying  Agent at  [insert  name and  address];
Attention: ______________, or at such other address of which the Bank shall from
time to time notify the  Registered  Holder,  must receive not more than 45, nor
less than 30,  days prior to an  Repayment  Date,  if any,  either (i) this Note
accompanied  by the  form  entitled  "Option  to  Elect  Repayment"  below  duly
completed,  or (ii) a telegram,  telex,  facsimile transmission or letter from a
member  of a  national  securities  exchange  or  the  National  Association  of
Securities  Dealers,  Inc. or a commercial  bank or trust  company in the United
States of America setting forth the name of the Registered Holder, the principal
amount  of the  Note,  the  principal  amount  of the  Note  to be  repaid,  the
certificate  number or a  description  of the  tenor  and  terms of the Note,  a
statement that the option to elect  repayment is being  exercised  thereby and a
guarantee  that the Note to be repaid  with the form  entitled  "Option to Elect
Repayment" on the Note duly  completed will be received by the Fiscal and Paying
Agent not later than five Business Days after the date of such telegram,  telex,
facsimile  transmission  or letter  and such Note and form  duly  completed  are
received by the Fiscal and Paying Agent by such fifth Business Day.  Exercise of
such  repayment  option by the  Registered  Holder hereof shall be  irrevocable,
except a Registered  Holder  tendering after receipt of a notice of an extension
of maturity.]

If so provided  on the face of this Note,  this Note may be redeemed by the Bank
on any Redemption  Date (or range of Redemption  Dates) so indicated on the face
hereof. If no Redemption Date (or range of Redemption Dates) is set forth on the
face hereof, this Note may not be redeemed prior to its Stated Maturity.  If one
or more Redemption Dates (or ranges of Redemption Dates) are so specified,  this
Note is  subject  to  redemption  at the  option  of the  Bank,  upon  notice by
first-class mail, not less than 30 nor more than 45 days prior to the Redemption
Date specified in such notice,  at the applicable  redemption price specified on
the face hereof (expressed as a percentage of the principal amount of this Note)
together  in the  case of any  such  redemption  with  accrued  interest  to the
Redemption Date, but interest installments due will be payable to the Registered
Holder on the relevant Regular Record Date if the Redemption Date is an Interest
Payment Date. The Bank may elect to redeem less than the entire principal amount
hereof;  provided,  that the principal amount, if any, of this Note that remains
outstanding after such redemption is an Authorized Denomination. In the event of
any redemption in part, the Bank will not be required to (i) issue, register the
transfer  of, or exchange  any Note during a period  beginning at the opening of
business 15 days before the day of the  mailing of the notice of  redemption  of
Notes selected for redemption and ending at the close of business on the date of
mailing of the relevant  notice of  redemption  or (ii) register the transfer or
exchange of any Note, or any portion thereof, called for redemption,  except the
unredeemed portion of any Note being redeemed in part. [Subordinated Bank Notes:
Notwithstanding  the foregoing,  this Note may not be redeemed without the prior
written consent of the Federal Deposit Insurance Corporation.]

Any money  deposited  with the Fiscal and  Paying  Agent for the  payment of the
principal of,  premium (if any) or interest on this Note that remains  unclaimed
for two years after such principal,  premium (if any) or interest has become due
and payable  shall be paid to the Bank and the Holder  shall  thereafter,  as an
unsecured general creditor,  look only to the Bank for payment thereof,  and all
liability  of the  Fiscal  and Paying  Agent  with  respect to such money  shall
thereupon cease.




<PAGE>



IN  WITNESS  WHEREOF,  the Bank has  caused  this Note to be duly  executed  and
countersigned by the Fiscal and Paying Agent or such other institution as may be
appointed by the Bank.

Countersigned for                               Trans Financial Bank,
                                                National Association
  authentication only

  as Fiscal and Paying Agent



By__________________________                  By__________________________
         Authorized Signature                        Authorized Signature
                                                              Attest:



                                                              ------------------
   Secretary


<PAGE>


                            OPTION TO ELECT REPAYMENT

The undersigned hereby irrevocably  request(s) and instruct(s) the Bank to repay
the within Note (or portion thereof  specified below) pursuant to its terms at a
price equal to the  principal  amount  thereof,  together  with  interest to the
repayment date, to the undersigned, at


       (Please print or typewrite name and address of the Undersigned)

For this Note to be repaid the Fiscal and Paying  Agent must  receive at [insert
name and  address];  Attention:  __________________,  or at such other  place or
places of which the  Company  shall  from time to time  notify the Holder of the
within  Note,  not more than 45,  nor less than 30,  days  prior to an  Optional
Repayment  Date, if any,  shown on the face of the within Note,  either (i) this
Note with this  "Option  to Elect  Repayment"  form  duly  completed,  or (ii) a
telegram,  telex,  facsimile  transmission or letter from a member of a national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial  bank or trust company in the United States of America  setting forth
the name of the Registered Holder of the Note, the principal amount of the Note,
the  principal  amount of the Note to be  repaid,  the  certificate  number or a
description  of the tenor and terms of the Note, a statement  that the option to
elect repayment is being  exercised  thereby and a guarantee that the Note to be
repaid with this form entitled Option to Elect Repayment" duly completed will be
received by the Fiscal and Paying Agent not later than five  Business Days after
the date of such telegram, telex, facsimile transmission or letter and such Note
and form duly  completed  are  received  by the Fiscal and Paying  Agent by such
fifth Business Day.

If less than the entire  principal  amount of the  within  Note is to be repaid,
specify the portion  thereof  (which shall be  increments  of $1,000)  which the
Holder  elects to have  repaid:  $________;  and  specify  the  denomination  or
denominations  (which  shall be $500,000  or an  integral  multiple of $1,000 in
excess of  $500,000)  of the Notes to be issued to the Holder for the portion of
the within Note not being repaid (in the absence of any such specification,  one
such Note will be issued for the portion not being repaid): $________.

Date:_______________                        ____________________________________
                                                     Note: The signature on this
                                                     Option  to Elect  Repayment
                                                     must  correspond  with  the
                                                     name as  written  upon  the
                                                     face of this  Note in every
                                                     particular          without
                                                     alteration or enlargement.


<PAGE>



                                              -------------------------
                                                    ABBREVIATIONS


The following  abbreviations,  when used in the  inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:

                  TEN COM -- as tenants in common

                  TEN ENT -- as tenants by the entireties

                  JT ENT  -- as joint tenants and not as tenants in common
                                                                       Custodian
                  UNIF GIFT MIN ACT --
 ................................................................................
                                                              (Cust)    (Minor)
                                              under Uniform Gift to Minors Act

 ..............................................................................
                                                                        (State)

Additional abbreviations may be used though not in the above list.


FOR VALUE  RECEIVED the  undersigned  hereby sells,  assigns and transfers  unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE


(Name and address of assignee, including zip code, must be printed or 
typewritten)


the within Note, and all rights thereunder, hereby irrevocably constituting
and appointing


to  transfer  said Note on the books of the within  Company,  with full power of
substitution in the premises.

Dated:


NOTICE:  The  signature  to this  assignment  must  correspond  with the name as
written upon the face of the within Note in every particular, without alteration
or  enlargement  or any change  whatever and must be  guaranteed by an "eligible
guarantor  institution" meeting the requirements of the Fiscal and Paying Agent,
which  requirements  include  membership or participation in STAMP or such other
"signature guaranty program" as may be determined by the Fiscal and Paying Agent
in  addition  to or in  substitution  for  STAMP,  all in  accordance  with  the
Securities Exchange Act of 1934, as amended.


<PAGE>


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





                                                        

                                  EXHIBIT C TO
                                FISCAL AND PAYING
                                AGENCY AGREEMENT



                    Certificate of Authorized Representatives


                  The undersigned certifies that pursuant to resolutions adopted
by the Board of Directors of Trans Financial  Bank,  National  Association  (the
"Bank"), dated _________ __, 1995, and with respect to the Bank Notes (the "Bank
Notes") of the Bank,  set forth  below is a list of  persons  who have been duly
elected  or  appointed  and have been duly  qualified  as,  and on this day are,
"Authorized  Representatives"  pursuant  to Section 2.2 of the Fiscal and Paying
Agency  Agreement,  dated as of _______ __, 1995 (the "Fiscal and Paying  Agency
Agreement"), between the Bank and ________________________, as Fiscal and Paying
Agent (in such capacity,  the "Fiscal and Paying  Agent"),  and such  Authorized
Representatives  are the  persons  authorized  to provide  the Fiscal and Paying
Agent with  instructions in accordance with Section 2.2 of the Fiscal and Paying
Agency  Agreement  and to execute  Bank Notes on behalf of the Bank by manual or
facsimile  signature  authorization,  and that each signature appearing below is
the person's genuine signature.

         Name                       Title                     Signature





                  IN WITNESS WHEREOF, I have hereunto signed my name.

Date:  __________, 1995



                                                              ------------------
                                                              Secretary






<PAGE>


--------------------------------------------------------------------------------
                                  EXHIBIT D TO
--------------------------------------------------------------------------------
                                FISCAL AND PAYING
                                AGENCY AGREEMENT



                            Administrative Procedures

                   SEE EXHIBIT B TO THE DISTRIBUTION AGREEMENT


<PAGE>


                                                                   EXHIBIT C

                               PURCHASE AGREEMENT



TRANS FINANCIAL BANK, NATIONAL ASSOCIATION   [DATE]
500 East Main Street
Bowling Green, Kentucky  42101




      The undersigned  agrees to purchase the following  principal amount of the
Notes  described in the  Distribution  Agreement dated September 28, 1995 (as it
may be supplemented or amended from time to time, the "Distribution Agreement"):



PRINCIPAL AMOUNT:                                    $ ___________
SENIOR OR SUBORDINATED:
SPECIFIED CURRENCY:
DENOMINATED AND INDEXED CURRENCIES:
INTEREST RATE:                                        ____%
DISCOUNT:                                             ____% of Principal Amount
AGGREGATE PRICE TO BE PAID TO ISSUING BANK (IN IMMEDIATELY AVAILABLE FUNDS):
                                                        $ ----------
SETTLEMENT DATE:
OTHER TERMS:


      Our  obligation  to purchase  Notes  hereunder is subject to the continued
accuracy of your  representations  and warranties  contained in the Distribution
Agreement and to your performance and observance of all applicable covenants and
agreements contained therein,  including,  without limitation,  your obligations
pursuant  to  Section 7  thereof.  Our  obligation  hereunder  is subject to the
further  condition  that we  shall  receive  (a)  the  opinions  required  to be
delivered pursuant to Sections 6(d) and 6(f) of the Distribution Agreement,  (b)
the  certificate  required  to be  delivered  pursuant  to  Section  6(e) of the
Distribution  Agreement [and (c) a letter  addressed to the Agent from KPMG Peat
Marwick covering such financial information as the Agent shall request].



      [In  further  consideration  of our  agreement  hereunder,  you agree that
between the date hereof and the above  Settlement  Date, none of the Corporation
or the Bank will offer or sell,  or enter  into any  agreement  to sell,  any of
their  respective debt securities which are  substantially  similar to the Notes
being purchased hereunder without our prior written consent.]



      We may terminate this  Agreement,  immediately  upon notice to you, at any
time prior to the  Settlement  Date, if prior thereto there shall have occurred:
(i) any adverse change or development  involving a prospective adverse change in
the capital  stock or long-term  debt of the  Corporation  or the Bank or any of
their  subsidiaries  or  in  the  condition,  financial  or  otherwise,  of  the
Corporation or any of its subsidiaries or the Bank or any of its subsidiaries or
the earnings,  affairs,  or business  prospects of the Corporation or any of its
subsidiaries or the Bank or any of its  subsidiaries,  whether or not arising in
the  ordinary  course of  business,  which  would,  in the opinion of the Agent,
materially  impair  the  investment  quality  of  the  Bank's  Notes;  (ii)  any
downgrading,  or any notice given of any intended or potential downgrading or of
any review for a possible  change that does not  indicate  the  direction of the
possible change,  in the rating accorded any of the  Corporation's or any of the
Bank's   securities   by   any   "nationally   recognized   statistical   rating
organization",  as such term is defined for purposes of Rule 436(g)(2) under the
Securities  Act;  (iii)  the  Corporation  and its  subsidiaries  shall  have no
liability  or  obligation,  direct  or  contingent,  which  is  material  to the
Corporation and its subsidiaries,  taken as a whole,  other than those reflected
in the Offering  Circular;  (iv) any outbreak or  escalation of  hostilities  or
other  national  or  international  calamity  or crisis  or  change in  economic
conditions or in the financial  markets of the United States or elsewhere  that,
in the judgment of the Agent, is material and adverse and would, in the judgment
of the Agent,  make it impracticable to market the Notes on the terms and in the
manner  contemplated  in the Offering  Circular;  (v) the suspension or material
limitation  of trading in any  securities  of the Company on any exchange or the
OTC Market or limitation on prices for any securities on any exchange or the OTC
market;  (vi) the enactment,  publication,  decree or other  promulgation of any
federal  or state  statute,  regulation,  rule or  order  of any  court or other
governmental  authority  which  in the  opinion  of  the  Agent  materially  and
adversely  affects,  or will  materially and adversely  affect,  the business or
operations of the Corporation or any of its subsidiaries;  (vii) the declaration
of a banking  moratorium  by either  federal  or New York State  authorities  or
(viii) the taking of any action by any  federal,  state or local  government  or
agency in respect of its monetary or fiscal  affairs which in the opinion of the
Agent has a  material  adverse  effect on the  financial  markets  in the United
States. In the event of such  termination,  no party shall have any liability to
the  other  party  hereto,  except as  provided  in  Sections  5, 8 and 9 of the
Distribution Agreement.



      This Agreement  shall be governed by and construed in accordance  with the
laws of New York.



                             DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION


                                                     By:
                                                                  [Title]

ACCEPTED:                , 19___

TRANS FINANCIAL BANK, NATIONAL ASSOCIATION



By:
                            [Title]



<PAGE>

[TYPE]EX-11

 Exhibit 11.


 Statement Regarding Computation of Per Share Earnings
 In thousands, except per share amounts
<TABLE>
<CAPTION>
                                                 Three Months            Nine Months
 For the periods ended September 30           1995           1994     1995       1994

Primary earnings per common share:
<S>                                        <C>        <C>         <C>        <C>     
  Average common shares outstanding ....     11,259     11,180      11,233     11,168
  Common stock equivalents .............        126         89         100         86
                                                      --------    --------   --------
    Average shares and share equivalents     11,385     11,269      11,333     11,254

Income before cumulative effect
  of change in accounting principle ....         $-         $-          $-   $ 10,315
Primary earnings per common share
  before cumulative effect of change
  in accounting principle ..............         $-         $-          $-   $   0.92

Net income .............................   $  4,544   $  3,807    $ 12,458   $ 10,369
Less preferred stock dividends .........       --          (14)       --          (54)
                                                      --------    --------   --------
Income available for common stock ......   $  4,544   $  3,793    $ 12,458   $ 10,315

Primary net income per share ...........   $   0.40   $   0.34    $   1.10   $   0.92


Fully-diluted earnings per common share:
  Average common shares outstanding ....     11,259     11,180      11,233     11,168
  Common stock equivalents .............        157         91         157         91
                                                      --------    --------   --------
    Average shares and share equivalents     11,416     11,271      11,390     11,259

Income before cumulative effect
  of change in accounting principle ....         $-         $-          $-   $ 10,315
Fully-diluted earnings per common share
  before cumulative effect of change
  in accounting principle ..............         $-         $-          $-   $   0.92

Net income .............................   $  4,544   $  3,807    $ 12,458   $ 10,369
Less preferred stock dividends .........       --          (14)       --          (54)
                                                      --------    --------   --------
Income available for common stock ......   $  4,544   $  3,793    $ 12,458   $ 10,315

Fully-diluted net income per share .....   $   0.40   $   0.34    $   1.09   $   0.92

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