TRANS FINANCIAL BANCORP INC, PRE 14A, 1995-02-06

TRANS FINANCIAL BANCORP INC
PRE 14A, 1995-02-06
STATE COMMERCIAL BANKS

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<PAGE>
SCHEDULE 14A INFORMATION
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14-a6(a)(2))

TRANS FINANCIAL BANCORP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
3) Filing Party:
------------------------------------------------------------------------
4) Date Filed:
------------------------------------------------------------------------
------------------------------------------------------------------------
<PAGE>
TRANS FINANCIAL BANCORP, INC.
500 EAST MAIN STREET
BOWLING GREEN, KENTUCKY 42101

March 8, 1995

To Our Shareholders:

You are cordially invited to attend the Annual Meeting of Shareholders of
Trans Financial Bancorp, Inc. (the "Corporation"), scheduled for 3:00 p.m.,
local time, on Monday, April 24, 1995 at The Phoenix Theatre, 549 East Main
Street, Bowling Green, Kentucky. Holders of the Corporation's outstanding common
stock as of March 1, 1995 are entitled to vote at the Annual Meeting.

Accompanying this letter is the Annual Report of the Corporation, a notice
of the meeting, a proxy card and a proxy statement relating to the meeting. The
proxy statement contains information relating to the actions to be taken at the
meeting. We urge you to review the Annual Report and the proxy statement in
their entirety in order that you may be fully informed about the matters to be
considered at the meeting. After reviewing the enclosed materials, we urge you
to complete the proxy card and return it to us in the enclosed envelope.

In addition to the specific matters set forth in the enclosed notice of the
meeting, we look forward to discussing with you at the meeting any questions you
may have concerning the operation of the Corporation during the past year.

We hope you will be able to attend the meeting in person. In any event it
would be appreciated if you would mark, sign and return the enclosed proxy card.
If you do attend the meeting and desire to vote in person, you may do so even
though you have previously sent in a proxy card.

Sincerely,

Douglas M. Lester
Chairman of the Board,
President and Chief Executive Officer
<PAGE>
TRANS FINANCIAL BANCORP, INC.
500 EAST MAIN STREET
BOWLING GREEN, KENTUCKY 42101

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

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Notice is hereby given that the Annual Meeting of Shareholders of Trans
Financial Bancorp, Inc. (the "Corporation") will be held on Monday, April 24,
1995, at 3:00 p.m., local time, at The Phoenix Theatre, 549 East Main Street,
Bowling Green, Kentucky, for the following purposes:

1. For the election of six Class I directors of the Corporation to hold
office in accordance with the terms and conditions set forth in the
accompanying proxy statement;

2. To consider a proposal to approve the Trans Financial Bancorp, Inc.
Executive Stock Option Plan;

3. To consider a proposal to approve the Trans Financial Bancorp, Inc.
Outside Directors' Restricted Stock Plan;

4. To consider a proposal to amend Article I of the Articles of
Incorporation of the Corporation to change the name of the Corporation to
"Trans Financial, Inc."; and

5. To consider and act upon such other matters as may properly come
before the meeting or any adjournment or adjournments thereof.

We hope you will attend the Annual Meeting in person. In any event, it would
be appreciated if you would mark, sign and return as soon as possible the
enclosed proxy card in the enclosed stamped, addressed envelope. If you do
attend the Annual Meeting and desire to vote in person, you may do so even
though you have previously sent in a proxy card. Only shareholders of record at
the close of business on March 1, 1995 will be entitled to notice of, and to
vote at, the meeting. The stock transfer books of the Corporation will not be
closed.

By Order of the Board of Directors,

Jay B. Simmons
Secretary

March 8, 1995
<PAGE>
TRANS FINANCIAL BANCORP, INC.
500 EAST MAIN STREET
BOWLING GREEN, KENTUCKY 42101

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

PROXY STATEMENT
MARCH 8, 1995
---------------

GENERAL INFORMATION

This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Trans Financial Bancorp, Inc. (the "Corporation") of
proxies for the Annual Meeting of Shareholders of the Corporation (the "Annual
Meeting") to be held on April 24, 1995, at The Phoenix Theatre, 549 East Main
Street, Bowling Green, Kentucky at 3:00 p.m. It is anticipated that this Proxy
Statement will first be mailed to the shareholders on March 8, 1995.

Anyone executing and delivering a proxy has the power to revoke it at any
time prior to the establishment of a quorum at the Annual Meeting. Such
revocation must be in writing and delivered to the Secretary of the Corporation
prior to the time the presence of a quorum has been determined and declared. Any
valid and unrevoked proxy will be voted as specified in the proxy. IF NO
SPECIFICATION IS MADE, THE PROXY WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS,
FOR THE PROPOSAL TO APPROVE THE TRANS FINANCIAL BANCORP, INC. EXECUTIVE STOCK
OPTION PLAN, FOR THE PROPOSAL TO APPROVE THE TRANS FINANCIAL BANCORP, INC.
OUTSIDE DIRECTORS' RESTRICTED STOCK PLAN, AND FOR THE PROPOSAL TO AMEND THE
ARTICLES OF INCORPORATION TO CHANGE THE NAME OF THE CORPORATION, ALL IN
ACCORDANCE WITH THE TERMS AND CONDITIONS SET FORTH IN THIS PROXY STATEMENT.

The solicitation of proxies will be made primarily by mail, and the
Corporation will bear the cost thereof. Certain officers and directors of the
Corporation and persons acting under their instructions, who will not be
specifically compensated for such services, may also solicit proxies on behalf
of management by means of telephone, personal interviews and mail. The cost of
such additional solicitation, if any, will not be material. Brokerage houses,
nominees, fiduciaries and other custodians will be requested to forward
soliciting materials to beneficial owners and will be reimbursed for their
reasonable expenses incurred in doing so. In addition, the Corporation has
retained Georgeson & Co. Inc. to assist in the solicitation of proxies from the
Corporation's shareholders. The fees to be paid to such firm for such services
by the Corporation are not expected to exceed $8500, plus reasonable
out-of-pocket costs and expenses.

At the Annual Meeting, shareholders will elect six directors to serve as
Class I directors. In addition, as disclosed in the Notice of the Annual
Meeting, proposals will be submitted to shareholders at the Annual Meeting (1)
to approve a new stock option plan under which key executive officers of the
Corporation and its subsidiaries may be granted options to purchase shares of
the common stock of the Corporation; (2) to approve a new restricted stock plan
under which the non-employee directors of the Corporation and its subsidiaries
may be granted restricted Common Stock of the Corporation as compensation for
their services as directors; and (3) to approve an amendment to Article I of the
Corporation's articles of incorporation changing the name of the Corporation to
Trans Financial, Inc. Only shareholders of record at the close of business on
March 1, 1995 (the "Record Date") are entitled to notice of, and to vote at, the
Annual Meeting.

SHARES AND VOTING

On the Record Date, there were issued and outstanding 11,203,249 shares of
common stock of the Corporation ("Common Stock"). Holders of Common Stock are
entitled to one vote for each share held on the Record Date on all matters
presented to the shareholders at the Annual Meeting, except that, in the
election of directors, cumulative voting rules will apply. Under cumulative
voting, each shareholder is entitled to cast as many votes in the aggregate as
shall equal the number of shares of Common Stock owned by him or her multiplied
by the number of directors to be elected. Each shareholder, or his or her proxy,
may
<PAGE>
cast all of his or her votes (as thus determined) for a single nominee for
director or may distribute them among two or more nominees, in the shareholder's
discretion. As to the authority of the persons named as proxies in the
accompanying proxy card to cumulate votes, see the section entitled ELECTION OF
DIRECTORS. Under cumulative voting, the six nominees receiving the most votes
cast for the election of directors at the Annual Meeting will be elected, which
means that abstentions and broker non-votes will have no effect on the outcome
of the vote.

Shareholders are being asked to approve the Trans Financial Bancorp, Inc.
1995 Executive Stock Option Plan so that executive officers who receive options
pursuant to the plan will be eligible for the exemption provided by Rule 16b-3
promulgated under Section 16(b) of the Securities Exchange Act of 1934. For
purposes of Rule 16b-3, the Securities and Exchange Commission (the "SEC") has
provided that an affirmative vote of a majority of all outstanding shares of the
Corporation's Common Stock represented in person or by proxy and entitled to
vote on the proposal is necessary for approval. Under the SEC's voting
requirement, abstentions and broker non-votes will have the effect of a "No"
vote.

Shareholders are being asked to approve the Trans Financial Bancorp, Inc.
Outside Directors' Restricted Stock Plan so that non-employee directors of the
Corporation and its subsidiaries who receive restricted stock pursuant to the
plan will be eligible for the exemption provided by Rule 16b-3 promulgated under
Section 16(b) of the Securities Exchange Act of 1934. For purposes of Rule
16b-3, the SEC has provided that an affirmative vote of a majority of all
outstanding shares of the Corporation's Common Stock represented in person or by
proxy and entitled to vote on the proposal is necessary for approval. Under the
SEC's voting requirement, abstentions and broker non-votes will have the effect
of a "No" vote.

Under the Corporation's articles of incorporation and bylaws and the
Kentucky Business Corporation Act, the proposal to amend Article I of the
articles of incorporation to change the name of the Corporation will require an
affirmative vote of a majority of the shares of Common Stock voted on the
proposal. Abstentions and broker non-votes are not counted in determining the
number of votes cast and in effect represent no action taken on the matter by
the abstaining shareholder, although they do reduce the number of votes required
for the approval of the proposal.

VOTING SECURITIES AND OWNERSHIP THEREOF

As of the Record Date, to the knowledge of the Corporation, no person or
entity beneficially owned more than five percent (5%) of the issued and
outstanding shares of Common Stock, which is the only class of stock of the
Corporation entitled to vote at the Annual Meeting, except as follows:

<TABLE>
<CAPTION>
PERCENT
NAME AND ADDRESS NUMBER OF CLASS
TITLE OF CLASS OF BENEFICIAL OWNER OF SHARES OUTSTANDING
- ----------------- ------------------------------------------------------------------- ------------ ---------------
<S> <C> <C> <C>
Common Stock Trans Financial Bank, N.A., as Trustee of the Trans Financial 860,760(1) 7.68%
Bancorp Savings Investment Plan and as Trustee of the Trans
Financial Bancorp Employee Stock Ownership Plan
500 East Main Street
Bowling Green, Kentucky 42101
<FN>
- ------------
(1) Includes 289,416 shares (or 2.58% of those outstanding) held as Trustee
under the Trans Financial Bancorp Savings Investment Plan ("Savings
Investment Plan") as of December 31, 1994, and 571,344 shares (or 5.10% of
those outstanding) held as Trustee under the Trans Financial Bancorp
Employee Stock Ownership Plan ("ESOP") as of December 31, 1994. The Common
Stock was acquired in open market transactions pursuant to the terms of the
Savings Investment Plan and the ESOP. Shares of Common Stock allocated to
the accounts of ESOP participants are voted by the participants, and the
Bank disclaims beneficial ownership of these shares. As of the Record Date,
shares aggregating 600,356 (or 5.36% of those outstanding) held in the
Savings Investment Plan or held in the ESOP and not yet allocated to
participants' accounts may be voted by the Trustee.
</TABLE>

2
<PAGE>
The following table sets forth information as of the Record Date relating to
the ownership of Common Stock by each director and nominee, the Corporation's
Chief Executive Officer, and each of the other five Named Executive Officers, as
such term is defined in EXECUTIVE COMPENSATION AND OTHER INFORMATION, and by all
directors, nominees for director and executive officers of the Corporation as a
group. Except where otherwise stated, sole voting and investment power are held
by the beneficial owners named.

<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL PERCENT OF CLASS
TITLE OF CLASS NAME OWNERSHIP OUTSTANDING
- ----------------- --------------------------------------------------- --------------------- -----------------
<S> <C> <C> <C>
Common Stock Vince Berta 5,857(1) .05%
Common Stock Barry D. Bray 60,592(2) .54%
Common Stock Mary D. Cohron 19,974 .18%
Common Stock Floyd H. Ellis 25,250 .22%
Common Stock J. David Francis 50,915(3) .45%
Common Stock Roy E. Gaddie 13,832(4) .12%
Common Stock John B. Gaines 48,902(5) .43%
Common Stock David B. Garvin 313,080(6) 2.77%
Common Stock Wayne Gaunce 27,440(7) .24%
Common Stock C.C. Howard Gray 4,193 .04%
Common Stock Charles A. Hardcastle 46,363(8) .41%
Common Stock Carroll Knicely 27,817(9) .25%
Common Stock Douglas M. Lester 124,937(10) 1.11%
Common Stock Roger E. Lundin 38,219(11) .34%
Common Stock C. Cecil Martin 42,759(12) .38%
Common Stock Frank Mastrapasqua 70,000 .62%
Common Stock Harold T. Matthews 38,658(13) .34%
Common Stock Joseph I. Medalie 69,757(14) .62%
Common Stock Dena R. Schaaf 2,581(15) .02%
Common Stock James D. Scott 52,909 .47%
Common Stock Charles M. Stewart 25,145(16) .22%
Common Stock William B. Van Meter 40,152(17) .35%
Common Stock Thomas R. Wallingford 43,248(18) .38%
Common Stock Roland D. Willock 22,688 .20%
Common Stock Directors, nominees for director and executive 1,249,362(19) 11.15%
officers as a group (27 persons)
<FN>
- ------------
(1) Includes 410 shares held by the Corporation's Savings Investment Plan, and
447 shares held by the Corporation's ESOP.
(2) Includes 11,150 shares held by the Corporation's Savings Investment Plan,
7,268 shares held by the Corporation's ESOP, 2,133 shares owned by Mr.
Bray's wife, and 23,855 shares issuable upon exercise of options granted
under the Corporation's stock option plans.
(3) Includes 16,932 shares owned by Mr. Francis' wife.
(4) Includes 480 shares owned by Mr. Gaddie's wife.
(5) Includes 1,133 shares owned by the Mabel Sharp Gaines Trust, of which Mr.
Gaines is the beneficiary.
(6) Includes 733 shares owned by a partnership of which Mr. Garvin is a general
partner, 105 shares owned by a partnership of which Mr. Garvin's wife is a
general partner and 2,212 shares owned by Mr. Garvin's children.
(7) Includes 23,163 shares owned by Mr. Gaunce's wife.
(8) Includes 7,367 shares owned by Mr. Hardcastle's wife and 24,090 shares
owned by B.G. Chemicals, Inc., in which Mr. Hardcastle is a 30% owner.
(9) Includes 6,469 shares owned by Mr. Knicely's wife.
</TABLE>

3
<PAGE>
<TABLE>
<C> <S>
(10) Includes 17,189 shares held by the Corporation's Savings Investment Plan,
11,415 shares held by the Corporation's ESOP, 25,189 shares issuable upon
exercise of options granted under the Corporation's stock option plans,
45,632 shares owned by Mr. Lester's wife, and 105 shares owned by a
partnership of which Mr. Lester's wife is a general partner. Under the
terms of Mr. Lester's Employment Agreement, Mr. Lester has the option to
purchase 4,000 shares exercisable in July 1995.
(11) Includes 5,237 shares held by the Corporation's Savings Investment Plan,
4,555 shares held by the Corporation's ESOP, and 12,093 shares issuable
upon exercise of options granted under the Corporation's stock option
plans.
(12) Includes 23,787 shares owned by Mr. Martin's wife, 3,333 shares owned by
Center of Insurance, Inc. of which Mr. Martin is a 50% owner, 4,666 shares
owned by Prefinco, Inc., a corporation wholly-owned by Mr. Martin, and 733
shares owned by a partnership of which Mr. Martin is a general partner.
(13) Includes 9,348 shares held by the Corporation's ESOP, 9,539 shares held by
the Corporation's Savings Investment Plan and 13,370 shares issuable upon
exercise of options granted under the Corporation's stock option plans.
(14) Includes 13,950 shares owned by Mr. Medalie's wife, 105 shares owned by a
partnership of which Mr. Medalie's wife is a general partner, and 14 shares
owned by a partnership of which Mr. Medalie is a general partner.
(15) Includes 575 shares held by the Corporation's Savings Investment Plan, and
377 shares held by the Corporation's ESOP.
(16) Includes 6,407 shares owned by Mr. Stewart's wife, and 105 shares owned by
a partnership of which Mr. Stewart's wife is a general partner.
(17) Includes 750 shares owned by Mr. Van Meter's child.
(18) Includes 5,618 shares owned by a revocable trust for the benefit of Mr.
Wallingford's wife, of which Mr. Wallingford is the sole trustee.
(19) Includes 86,600 shares issuable upon exercise of options granted under the
Corporation's stock option plans.
</TABLE>

Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's executive officers and directors and persons who own more than ten
percent (10%) of the Corporation's Common Stock to file reports of ownership and
changes in ownership with the SEC. Based solely on its review of the forms filed
with the SEC, or written representations from certain reporting persons that no
Forms 5 were required for those persons, the Corporation believes that all its
officers, directors and greater than 10% beneficial owners complied with all
filing requirements applicable to them during 1994, with the following
exceptions. A revocable trust for the benefit of Mr. Wallingford's wife, of
which Mr. Wallingford is the sole trustee, did not timely file its initial
statement of ownership at the time Mr. Wallingford became a director, although
Mr. Wallingford did include these shares in his own timely filed initial
statement of ownership. Mr. Gaddie was one month late in reporting the purchase
of 400 shares of Common Stock by his wife in May 1994. Mr. Martin was one month
late in reporting his purchase of 548 shares of Common Stock in December 1994.
Mr. Van Meter did not timely file one report with respect to the purchase of 80
shares of Common Stock by an Individual Retirement Account owned by Mr. Van
Meter.

PROPOSAL I
ELECTION OF DIRECTORS

The articles of incorporation and bylaws of the Corporation provide that the
Board of Directors shall be composed of not less than nine nor more than twenty
members with the exact number to be determined each year by resolution of a
majority of the full Board of Directors. The Board of Directors has fixed the
number of directors for the ensuing year at nineteen. Article VIII of the
Corporation's articles of incorporation provides for the division of the Board
into three classes as permitted by the laws of Kentucky. Election of directors
to each of the three classes is staggered in order that one class of directors
will be elected at each annual meeting. Six Class I directors will be elected at
the upcoming Annual Meeting.

4
<PAGE>
On October 17, 1994, James D. Scott was elected by the Board of Directors to
fill the Class II vacancy created as a result of the death of Noel P. Ennis.
Pursuant to the Kentucky Business Corporation Act, Mr. Scotts term will expire
on the date of the Annual Meeting. Mr. Scott has been nominated for election as
a Class I director.

Class II directors will be elected at the 1996 Annual Meeting of
Shareholders, and Class III directors will be elected at the 1997 Annual Meeting
of Shareholders.

The following table contains information concerning all of the current
directors and nominees for director of the Corporation, including the positions
held with Trans Financial Bank, National Association located in Bowling Green,
Kentucky ("TFBNA"), Trans Financial Bank of Pikeville, National Association
located in Pikeville, Kentucky ("TFB Pikeville"), Trans Financial Bank of
Martin, National Association located in Martin, Kentucky ("TFB Martin"), Trans
Financial Bank, Federal Savings Bank located in Russellville, Kentucky ("TFB,
FSB"), Trans Financial Bank Tennessee, National Association located in
Cookeville, Tennessee ("TFBTn,NA"), and Trans Financial Bank of Tennessee, FSB
located in Tullahoma, Tennessee ("TFB of TN") (collectively, the "Banks"), and
identifies those individuals who will be nominated for election at the Annual
Meeting. The Class I directors will be elected to serve for a term of three
years and until their successors have been elected and qualified.

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION,
BUSINESS EXPERIENCE
POSITION AND POSITION AND DURING PAST FIVE DIRECTOR OF
OFFICE HELD OFFICE HELD YEARS AND OTHER CORPORATION
NAME AND AGE WITH BANKS WITH CORPORATION DIRECTORSHIPS HELD OR BANKS SINCE
- ------------------------ -------------------- ------------------ ---------------------------- --------------
<S> <C> <C> <C> <C>

CLASS I DIRECTORS NOMINATED FOR ELECTION AT THE ANNUAL MEETING:

Mary D. Cohron Director of TFBNA Director, Class I Owner, Greencastle Farms, 1979
age 47 Inc.

Floyd H. Ellis, Director of TFBNA Director, Class I President, Warren Rural 1977
age 68 Electric Co-op
Corporation; Farmer

David B. Garvin, Director of TFBNA Director, Class I Chairman of the Board, 1989
age 52 Camping World, Inc.

Douglas M. Lester Chairman, Chief Director, Class I; Chairman of the Board, 1984
age 52 Executive Officer Chairman of the President and Chief
and Director of Board, President Executive Officer of the
TFBNA; and Chief Corporation;
Director of TFB Executive Officer Chairman of the Board and
Pikeville Chief Executive Officer of
TFBNA;
President of TFBNA from
1984 to 1991 and from 1994
to present; Director of
TFB Pikeville

James D. Scott Director of TFBNA Director, Class II Owner, Scotty's Contracting 1994
age 57 and Stone Co., Inc.

Thomas R. Wallingford, Director of TFBNA Director, Class I Retired; Former Chairman of 1994
age 67 the Board and President,
Kentucky Community
Bancorp, Inc.
</TABLE>

5
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION,
BUSINESS EXPERIENCE
POSITION AND POSITION AND DURING PAST FIVE DIRECTOR OF
OFFICE HELD OFFICE HELD YEARS AND OTHER CORPORATION
NAME AND AGE WITH BANKS WITH CORPORATION DIRECTORSHIPS HELD OR BANKS SINCE
- ------------------------ -------------------- ------------------ ---------------------------- --------------
<S> <C> <C> <C> <C>
DIRECTORS WHOSE TERMS OF OFFICE EXTEND BEYOND THE ANNUAL MEETING:

Barry D. Bray, Director and Chief Director, Class Executive Vice President and 1991
age 48 Credit Officer of II; Executive Vice Chief Credit Officer,
TFBNA President and Corporation; Director and
Chief Credit Chief Credit Officer,
Officer TFBNA; President of TFBNA
from 1991 to 1994;
Director of TFB Pikeville

John B. Gaines, Director of TFBNA Director, Class II President, News Publishing 1964
age 80 Company, Master Printers,
Inc. and Daily News
Broadcasting

Wayne Gaunce, Director of TFBNA Director, Class II President, Gaunce 1977
age 61 Management, Inc.,
Caveland, Inc.; Director,
Papa John's International,
Inc.

Charles A. Hardcastle, Director of TFBNA Director, Class II President, B.G. Chemicals, 1982
age 62 Inc., B.G. Paper Company,
B.G. Fire & Safety,
Consolidated Sanitary
Supply and Contract Staff
Services; Owner,
Hardcastle Company,
Southland Manufacturing,
B.G. Cash & Carry, Ashley
Center, Inc. and Ky. Wood
Products

Charles M. Stewart, Director of TFBNA Director, Class II Retired; Business Consultant 1961
age 86

William B. Van Meter, Director of TFBNA Director, Class II Chairman, Van Meter 1982
age 48 Insurance Agency, Inc.;
Owner, Van Meter
Investments

J. David Francis, Director of TFBNA Director, Class Retired; Former Judge, 1964
age 75 III Circuit Court

Roy E. Gaddie, Director of TFBNA Director, Class Retired; Business Consultant 1961
age 88 III

C.C. Howard Gray, Director of TFBNA Director, Class President, James N. Gray 1977
age 45 III Construction Co., Inc.

Carroll Knicely, Director of TFBNA Director, Class President, Associated 1977
age 66 III Publications, Inc.; Real
estate developer
</TABLE>

6
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION,
BUSINESS EXPERIENCE
POSITION AND POSITION AND DURING PAST FIVE DIRECTOR OF
OFFICE HELD OFFICE HELD YEARS AND OTHER CORPORATION
NAME AND AGE WITH BANKS WITH CORPORATION DIRECTORSHIPS HELD OR BANKS SINCE
- ------------------------ -------------------- ------------------ ---------------------------- --------------
<S> <C> <C> <C> <C>
C. Cecil Martin, Director of TFBNA Director, Class President, Center of 1990
age 39 III Insurance, Inc.

Frank Mastrapasqua, Director of TFB of Director, Class President, Mastrapasqua & 1991
age 53 TN III Associates; Formerly,
Partner and Director of
Research, J.C. Bradford &
Co.

Joseph I. Medalie, Director of TFBNA Director, Class Retired; Former Vice- 1972
age 72 III Chairman of the Board,
Fruit-of-the-Loom, Inc.
</TABLE>

If any person or persons other than the nominees named above are nominated
as directors, then the proxies named in the enclosed proxy card, or their
substitutes, or a majority of them, shall have the right in their discretion to
vote cumulatively for some number less than all the nominees named above or for
such of the other nominees as they may choose. If any of the nominees named
above becomes unwilling or unable to accept nomination or election, then the
proxies shall have the right to vote for any substitute nominee in place of the
nominee who has become unwilling or unable to accept nomination or election.

There are no family relationships between any director or executive officer
of the Corporation or any nominee. Except as otherwise described herein, there
are no arrangements or understandings regarding the election of any of the
foregoing nominees as directors. All nominations for membership on the Board of
Directors originated with the Board of Directors.

COMMITTEES OF THE BOARD

The Corporation has an Audit Committee consisting of directors Gaunce, Gray,
Van Meter and Willock. It is the responsibility of the Audit Committee annually
to cause audits to be made by auditors responsible only to the Board of
Directors; to review the audits and operational procedures of the Corporation
and the Banks; to ascertain whether the Banks are being operated in compliance
with the requirements of the various regulatory authorities having jurisdiction
over the Banks' operations; to review reports of examinations made by federal
and state bank examiners and ascertain that any and all operational deficiencies
set forth in said reports are satisfactorily corrected; to review the annual
reports submitted by the internal auditors and ascertain that the internal
auditors are carrying out internal audit programs that are adequate to verify
that the policies and procedures formulated for the operation of the Corporation
and the Banks are being followed and that a sufficient system of internal
control is being maintained; and to report its findings to the Board of
Directors. The Audit Committee met four times in 1994.

The Corporation has an Executive Committee consisting of directors Cohron,
Ellis, Garvin, Hardcastle, Lester and Medalie. It is the responsibility of the
Executive Committee to study, advise and make recommendations to the Board of
Directors on matters relating to the overall management of the Corporation and
the Banks; to review policies and practices relating to Board functions and
banking practices and make recommendations to the Board of Directors as
appropriate; and to study, advise and make recommendations to the Board of
Directors concerning any acquisitions and mergers contemplated by the
Corporation. The Executive Committee met seven times in 1994.

The Corporation has a Compensation Committee consisting of directors Cohron,
Ellis, Garvin, Hardcastle and Medalie. It is the responsibility of the
Compensation Committee to review and approve all issues pertaining to executive
compensation for submission to the full Board of Directors of the Corporation.
The Compensation Committee met two times in 1994.

The Corporation has a Stock Option Committee consisting of directors Cohron,
Ellis, Garvin, Hardcastle and Medalie. It is the responsibility of the Stock
Option Committee to review and approve all issues

7
<PAGE>
pertaining to stock options granted or to be granted to the executive officers
and employees of the Corporation and the Banks for submission to the
non-management members of the Board of Directors of the Corporation. The Stock
Option Committee met two times in 1994.

The Corporation has no Nominating Committee. All nominations for membership
on the Board of Directors originate with the Board of Directors.

During 1994, there were 14 meetings of the Corporation's Board of Directors.
Each of the directors attended at least seventy-five percent (75%) of the
aggregate of (a) the total number of meetings of the Board of Directors held
during the period for which he or she was a director, and (b) the total number
of meetings held by all committees of the Board on which he or she served, with
the exception of Mr. Gaines, Mr. Garvin and Mr. Gray.

EXECUTIVE COMPENSATION AND OTHER INFORMATION

The following table provides certain summary information concerning
compensation paid or accrued by the Corporation and its subsidiaries for the
fiscal years ended December 31, 1992, 1993 and 1994, to or on behalf of (a) the
Corporation's Chief Executive Officer, (b) the other four most highly
compensated executive officers of the Corporation whose compensation exceeded
$100,000 (determined as of the end of 1994), and (c) Mr. Harold Matthews, who
would have been one of the officers described in (b) above but for the fact that
he was no longer an executive officer of the Corporation at the end of 1994,
although still employed by the Corporation and its subsidiaries. These officers
are referred to herein as the "Named Executive Officers."

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
-------------
ANNUAL COMPENSATION SECURITIES ALL OTHER
---------------------------------- UNDERLYING COMPENSATION (1)
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) OPTIONS (#) ($)
- ------------------------------------------------- --------- ---------- ----------- ------------- ----------------
<S> <C> <C> <C> <C> <C>
Douglas M. Lester, President, 1994 $ 236,000 $ 42,244 101,000(2) $ 11,239(3)
Chairman and Chief Executive 1993 236,000 0 10,250 20,978
Officer 1992 175,000 87,500 4,000 25,788

Vince Berta, Executive Vice 1994 $ 134,000 $ 22,540 43,000(5) $ 5,706(6)
President, Chief Financial 1993 88,940 20,000 0 5,790
Officer and Treasurer (4) 1992 0 0 0 0

Barry D. Bray, Executive Vice 1994 $ 164,000 $ 26,404 3,000 $ 9,637(7)
President and Chief Credit 1993 164,000 0 6,250 20,958
Officer 1992 120,000 60,000 0 18,587

Roger E. Lundin, Senior Vice 1994 $ 96,000 $ 15,456 4,000 $ 4,105(8)
President 1993 96,000 0 5,001 13,401
1992 90,000 45,000 0 13,454

Harold T. Matthews, President 1994 $ 126,000 $ 26,233 3,000 $ 6,119(9)
of Glasgow Division of 1993 126,000 0 3,500 17,042
TFBNA 1992 108,000 54,000 0 17,367

Dena R. Schaaf, Senior Vice 1994 $ 90,000 $ 14,490 4,000 $ 3,965(11)
President (10) 1993 90,000 0 0 6,680
1992 5,853 7,000 0 0
<FN>
- ------------
(1) Information concerning the Corporation's annual contribution to the
Corporation's Employee Stock Ownership Plan for 1994 is not yet available.
</TABLE>

8
<PAGE>
<TABLE>
<C> <S>
(2) Includes 91,000 shares underlying an option granted to Mr. Lester under the
Trans Financial Bancorp, Inc. 1995 Executive Stock Option Plan, conditioned
on shareholder approval. See PROPOSAL II, APPROVAL OF TRANS FINANCIAL
BANCORP, INC. 1995 EXECUTIVE STOCK OPTION PLAN.
(3) Consists of the Corporation's matching contributions to the Corporation's
Savings Investment Plan ("SIP") in the amount of $9,240 and premiums in the
amount of $1,999 paid by the Corporation for term life insurance for the
benefit of Mr. Lester.
(4) Mr. Berta joined the Corporation in April 1993.
(5) Includes 37,000 shares underlying an option granted to Mr. Berta under the
Trans Financial Bancorp, Inc. 1995 Executive Stock Option Plan, conditioned
on shareholder approval. See PROPOSAL II, APPROVAL OF TRANS FINANCIAL
BANCORP, INC. 1995 EXECUTIVE STOCK OPTION PLAN.
(6) Consists of the Corporation's matching contributions to the SIP in the
amount of $5,362 and premiums in the amount of $344 paid by the Corporation
for term life insurance for the benefit of Mr. Berta.
(7) Consists of the Corporation's matching contributions to the SIP in the
amount of $9,240 and premiums in the amount of $397 paid by the Corporation
for term life insurance for the benefit of Mr. Bray.
(8) Consists of the Corporation's matching contributions to the SIP in the
amount of $3,840 and premiums in the amount of $265 paid by the Corporation
for term life insurance for the benefit of Mr. Lundin.
(9) Consists of the Corporation's matching contributions to the SIP in the
amount of $5,052 and premiums in the amount of $1,067 paid by the
Corporation for term life insurance for the benefit of Mr. Matthews.
(10) Ms. Schaaf joined the Corporation in November 1992.
(11) Consists of the Corporation's matching contributions to the SIP in the
amount of $3,675 and premiums in the amount of $290 paid by the Corporation
for term life insurance for the benefit of Ms. Schaaf.
</TABLE>

STOCK OPTIONS

The following table contains information concerning the grant of stock
options to the named executive officers during the fiscal year ending December
31, 1994.

OPTION GRANTS IN 1994

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------------------------ POTENTIAL REALIZABLE
PERCENT OF VALUE AT ASSUMED
TOTAL ANNUAL RATES OF
OPTIONS STOCK PRICE
NUMBER OF GRANTED TO APPRECIATION
SECURITIES EMPLOYEES FOR OPTION TERM
UNDERLYING IN FISCAL EXERCISE EXPIRATION ------------------------
NAME OPTIONS YEAR PRICE($/SH) DATE 5%($) 10%($)
- -------------------------- -------------------- ------------- ----------- ------------ ---------- ------------

<S> <C> <C> <C> <C> <C> <C>
Douglas M. Lester 4,000(1) 1.29% $ 5.625 7/31/1994 $ 0 $ 0
6,000(2) 1.93% $ 16.50 1/10/2004 $ 62,261 $ 157,780
91,000(3) 29.30% $ 15.75 12/19/2004 $ 512,261 $ 1,664,651
Vince Berta 6,000(2) 1.93% $ 16.50 1/10/2004 $ 62,261 $ 157,780
37,000(3) 11.91% $ 15.75 12/19/2004 $ 208,282 $ 676,836
Barry D. Bray 3,000(2) .96% $ 16.50 1/10/2004 $ 31,130 $ 78,890
Roger E. Lundin 4,000(2) 1.29% $ 16.50 1/10/2004 $ 41,507 $ 105,187
Harold T. Matthews 3,000(2) .96% $ 16.50 1/10/2004 $ 31,130 $ 78,890
Dena R. Schaaf 4,000(2) 1.29% $ 16.50 1/10/2004 $ 41,507 $ 105,187
<FN>
- ------------
(1) Under the terms of Mr. Lester's Employment Agreement, Mr. Lester is granted
on January 1 of each year during the term of the Agreement, subject to
certain limitations, a nontransferable right to purchase annually 4,000
shares of Common Stock at $5.625 per share exercisable only during the
month
</TABLE>

9
<PAGE>
of July, and only so long as Mr. Lester is then employed by the Corporation
or TFBNA. Mr. Lester's right to purchase stock annually is not cumulative.
However, if the Corporation were to liquidate, dissolve, or merge or combine
into another corporation, Mr. Lester's right to purchase Common Stock during
the unexpired term of the Employment Agreement would be immediately
accelerated so that he could exercise his option to purchase that total
number of shares, as to which he has not previously forfeited options, for
which he would otherwise have had options had he remained employed
throughout the then current term of the Employment Agreement. The options
granted Mr. Lester are nontransferable and the death of Mr. Lester or the
termination of Mr. Lester's employment under the Employment Agreement,
whether voluntary or involuntary and whether with or without cause, will
terminate all rights and options not previously exercised by Mr. Lester. In
no event shall Mr. Lester have the option to purchase shares as would cause,
immediately after the exercise of the option, the total number of shares
owned by Mr. Lester, or subject to options exercisable by Mr. Lester, to
exceed 5% of the total combined voting power of all classes of the
Corporation's Common Stock. In July 1994, Mr. Lester exercised the option
listed in the table above. See AGGREGATE OPTION EXERCISES IN LAST FISCAL
YEAR AND FISCAL YEAR-END OPTION VALUES.

(2) One-third of the option may be exercised on or after January 10, 1996, a
second one-third may be exercised on or after January 10, 1997, and the
final one-third may be exercised on or after January 10, 1998.

(3) Under the terms of the Trans Financial Bancorp, Inc. 1995 Executive Stock
Option Plan, the grants of these options are conditioned upon approval of
the plan by the shareholders of the Corporation. If the plan is approved,
the options will be exercisable on or after December 19, 1997. See PROPOSAL
II, TRANS FINANCIAL BANCORP, INC. 1995 EXECUTIVE STOCK OPTION PLAN.

OPTION EXERCISES AND HOLDINGS

The following table provides information with respect to the Named Executive
Officers concerning the exercise of options during 1994 and unexercised options
held as of December 31, 1994:

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED
UNDERLYING IN-THE-MONEY
UNEXERCISED OPTIONS AT
OPTIONS AT FISCAL YEAR
FISCAL YEAR END(#) END(2)
SHARES ------------------- -----------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($)(1) UNEXERCISABLE UNEXERCISABLE (#)
- ---------------------------------- ------------- ------------- ------------------- -----------------

<S> <C> <C> <C> <C>
Douglas M. Lester 4000 $ 40,500 20,736/108,286(3) $74,452/$15,397
Vince Berta 0 $ 0 0/43,000(4) $0/$0
Barry D. Bray 0 $ 0 19,402/14,286 $69,615/$15,397
Roger E. Lundin 0 $ 0 9,537/11,371 $32,855/$6,482
Harold T. Matthews 0 $ 0 10,723/9,462 $38,596/$9,350
Dena R. Schaaf 0 $ 0 0/4,000 $0/$0
<FN>
- ------------
(1) Market price at time of exercise less exercise price.
(2) Market value of underlying securities at December 31, 1994 minus the
exercise price at December 31, 1994.
(3) Includes 91,000 shares underlying an option granted under the Trans
Financial Bancorp, Inc. 1995 Executive Stock Option Plan.
(4) Includes 37,000 shares underlying an option granted under the Trans
Financial Bancorp, Inc. 1995 Executive Stock Option Plan.
</TABLE>

10
<PAGE>
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL
ARRANGEMENTS

Mr. Lester has an Employment Agreement with the Corporation and TFBNA
pursuant to which Mr. Lester is employed as the Chairman of the Board and Chief
Executive Officer of the Corporation and TFBNA and as President of the
Corporation. Mr. Lester's Employment Agreement has an initial three-year term,
renewable annually such that the outstanding term continues to be three years.
If the Employment Agreement is not renewed by the Corporation or TFBNA, or if
the Corporation or TFBNA terminates the Employment Agreement without cause, as
defined therein, then Mr. Lester will be entitled to receive, as severance pay,
his base salary for the unexpired term of the Employment Agreement. Mr. Lester
may terminate his employment and the Employment Agreement at any time upon 60
days written notice to the Corporation, in which event all rights to
compensation and fringe benefits will terminate. Mr. Lester's base salary under
the Employment Agreement is established by the Board of Directors of the
Corporation at the commencement of each year and for the fiscal year ending
December 31, 1994 was $236,000. Under the terms of Mr. Lester's Employment
Agreement, Mr. Lester is entitled, subject to certain limitations, to a
nontransferable right to purchase annually 4,000 shares of Common Stock at
$5.625 per share. See footnote 1 to the table OPTION GRANTS IN 1994.

Mr. Matthews is employed as the President of the Glasgow division of TFBNA
pursuant to the employment agreement he entered into with TFBNA effective
January 1, 1991. Mr. Matthews' employment agreement had an initial three year
term and is renewable automatically for additional one year terms. It provides
for a minimum salary of $100,000, subject to increase by TFBNA's Board of
Directors, and may be terminated by TFBNA at any time without cause upon 90 days
notice. Upon such termination, Mr. Matthews will receive, as severance pay, his
compensation and other fringe benefits during the twelve months following the
date notice of termination is given, and all rights to compensation and fringe
benefits which accrue during such twelve month period.

Upon a Change in Control of the Corporation, as hereafter defined, the
exercise dates of all outstanding options under the Corporation's Executive
Stock Option Plan will accelerate, and the exercise dates of all outstanding
options under the Corporation's other stock option plans may be accelerated at
the discretion of the Stock Option Committee, so that each option outstanding
may be exercised on or after the date of the Change in Control. In addition, the
shares subject to the Corporation's stock option plans will be automatically
converted into and replaced by shares of common stock or other equity securities
having rights and preferences no less favorable than common stock of the
successor and the number of shares subject to the options and the purchase price
per share upon exercise of the options will be correspondingly adjusted so that
there will be no change in the aggregate purchase price payable upon exercise of
any such option.

For purposes of the 1995 Executive Stock Option Plan, a Change in Control of
the Corporation means:

(a) any share exchange or merger or consolidation to which the Corporation
or a significant subsidiary of the Corporation is a party, or any
purchase or other acquisition of substantially all of the business or
assets of the Corporation or any significant subsidiary of the
Corporation in any transaction or series of transactions by another
corporation or entity, if either (i) the Corporation will not be the
surviving or acquiring corporation or will not own 100% of the
outstanding capital stock of the surviving, acquiring or transferee
corporate entity immediately following the consummation of the
transactions, or (ii) there will be a 25% change in the proportionate
ownership of outstanding shares of voting stock of the Corporation as a
result of the transactions;

(b) any person (as that term is used in Sections 13(d) and 14(d) of the
Exchange Act) is or becomes the beneficial owner of stock of the
Corporation entitled to cast more than 20% of the votes at the time
entitled to be cast generally for the election of directors;

(c) more than 50% of the members of the Board shall not be Continuing
Directors (meaning directors of the Corporation (i) who are members of
the Board on February 1, 1995, (ii) who subsequently became directors of
the Corporation by a vote of a majority of the Continuing Directors then
on

11
<PAGE>
the Board of Directors, or (iii) whose election or nomination for
election by the Corporation's stockholders was approved by a vote of a
majority of the Continuing Directors then on the Board of Directors); or

(d) the Board or the shareholders of the Corporation approve, adopt, agree
to recommend, or accept any agreement, contract, offer or other
arrangement providing for, or any series of transactions resulting in,
any of the transactions described above.

For purposes of the Corporation's other stock option plans, a Change in
Control of the Corporation means:

(a) any share exchange or merger or consolidation of the Corporation or a
significant subsidiary of the Corporation if either (i) the Corporation
will not be the surviving or acquiring corporation or will not own 100%
of the outstanding capital stock of the surviving or acquiring
corporation following the consummation of the transactions contemplated
by the plan or agreement of exchange, merger or consolidation, or (ii)
there will be a substantial change in the proportionate ownership of
outstanding shares of voting stock of the Corporation as a result of the
transactions contemplated by such plan or agreement of exchange, merger
or consolidation;

(b) any sale, lease, exchange, transfer or other disposition of all or any
substantial part of the assets of the Corporation or a subsidiary of the
Corporation followed by a liquidation of the Corporation;

(c) the commencement of any tender offer, exchange offer or other purchase
offer for, and/or any agreement to purchase, as much as (or more than)
25% of the outstanding Common Stock of the Corporation or a subsidiary of
the Corporation; or

Twenty-six officers of the Corporation and its subsidiaries have
nonqualified deferred compensation agreements with the Corporation or its
subsidiaries, whereby the officers will receive deferred compensation upon
retirement at age 65, death prior to age 65 or termination for any reason
following a Change of Control of the Corporation. All benefits under each
agreement are forfeited if the employee commits suicide, the employee's
employment is terminated for any reason other than death or Change of Control of
the Corporation or the employee competes with the Corporation in violation of
the noncompete provisions contained in the agreements.

REPORT OF COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION

This report reflects the Corporation's compensation policies with respect to
its executive officers as endorsed by the Compensation Committee of the Board of
Directors and resulting actions taken by the Corporation for the reporting
periods shown in the various compensation tables supporting this report. With
respect to 1994, decisions on compensation of the Corporation's executives were
made by the Compensation Committee and approved by the Board of Directors,
except for decisions about awards under certain of the Corporation's stock
option plans, which must be made solely by the Stock Option Committee of the
Board, consisting of directors Cohron, Ellis, Garvin, Hardcastle and Medalie, in
order for the grants or awards under such plans to satisfy Securities Exchange
Act Rule 16b-3. With regard to compensation actions affecting Messrs. Lester and
Bray, all of the non-employee members of the Board of Directors acted as the
approving body.

Essentially, the Corporation, through its executive compensation policies
seeks to provide compensation that will enable the Corporation to compete for
and retain talented executives who are critical to the Corporation's long-term
success, support a pay for performance policy, motivate key senior officers to
achieve strategic business initiatives and reward them for their achievements,
and align the interests of executives with the long-term interests of
stockholders through opportunities that can result in ownership of Common Stock.

12
<PAGE>
At present, the executive compensation program of the Corporation is
comprised of salary, annual cash incentive opportunities, long term incentive
opportunities in the form of stock options, and certain broad based employee
benefit plans in which the executive officers participate, primarily the
Corporation's Savings Investment Plan and Employee Stock Ownership Plan. In
February 1994 the Compensation Committee received the results of a compensation
study performed by an independent compensation consulting firm commissioned by
the Board of Directors. For 1995 and thereafter, the executive compensation
policies of the Corporation and compensation decisions with respect to the
Corporation's executive officers have been and will be determined by the
Corporation's Compensation Committee and reflect, in part, the results of the
compensation study.

For 1994 the Chief Executive Officer recommended to the Compensation
Committee generally that no increases be made in the salaries of any of the
Corporation's executive officers. This recommendation was based mainly on the
fact that the profitability of the Corporation had not increased significantly
from the prior year. After review and consultation with the Chief Executive
Officer, the Compensation Committee followed the Chief Executive Officer's
recommendation and made no increases in the salaries of the executive officers,
with the exception of one instance in which the Compensation Committee
determined that an increase was warranted based on the officer's individual
performance.

The Chief Executive Officer's salary was based principally on his rights
under his Employment Agreement with the Corporation dated January 1, 1991,
described elsewhere in the Proxy Statement. Under the Employment Agreement, the
Board established Mr. Lester's minimum annual base salary for 1993 at $236,000.
As discussed above with respect to the salaries of the other executive officers,
the salary of the Chief Executive Officer was not increased by the Board in
1994. This decision was also based mainly on the profitability of the
Corporation during 1993.

For fiscal year 1994, the annual cash incentives for the Corporation's
executive officers and certain other employees was determined under the
Corporation's Performance Incentive Plan. Under this Plan, the Corporation's and
the Banks' performance was measured against goals established for the fiscal
year by the Compensation Committee in order to determine the cash incentives to
be awarded. Goals were established in the following categories of performance:
(i) growth in the Corporation's earnings per share, (ii) the Corporation's
return on equity, (iii) the Corporation's operating efficiency, (iv)
acquisitions of financial institutions completed, (v) the Banks' return on
assets, (vi) the Banks' deposit growth, and (vii) the Banks' operating
efficiencies. The categories and goals applicable to each of the participating
officers and employees were determined based on that officer's or employee's
position in the Corporation and his or her resulting ability to affect the
outcome of the Corporation or the Banks with respect to those goals. Cash
incentives for a participant were determined as a percentage of his or her base
salary on a sliding scale depending on the performance of the Corporation or the
Banks in the categories applicable to that participant. For each of the
categories, a minimum performance target was established, below which no cash
incentive would be awarded, and a maximum potential cash incentive award was
also established. The cash incentive awarded to a participant equalled the sum
of the incentives determined with respect to each applicable category.

For the Chief Executive Officer and the other executive officers of the
Corporation (including all of the Named Executive Officers except Mr. Matthews)
goals were established in the categories of (i) growth in the Corporation's
earnings per share over the prior fiscal year, (ii) the Corporation's return on
equity, (iii) the Corporation's overall operating efficiency, and (iv)
acquisitions of financial institutions completed. In 1994, the Corporation
achieved return on equity in the range of goals established under the Plan, and
the Corporation completed three acquisitions. Therefore, cash incentives with
respect to these two categories were paid to the Corporation's executive
officers, including the Chief Executive Officer, for 1994 as indicated in the
SUMMARY COMPENSATION TABLE.

During 1994, Mr. Matthews was an officer and director of TFBNA. For Mr.
Matthews (and other similarly situated participants) goals were established in
the categories of (i) growth in the Corporation's earnings per share over the
prior fiscal year, (ii) the Corporation's return on equity, (iii) the
Corporation's overall operating efficiency, (iv) TFBNA's return on assets, (v)
TFBNA's deposit growth, and (vi) TFBNA's

13
<PAGE>
operating efficiency, with 75% of Mr. Matthew's potential cash incentive tied to
the categories relating to TFBNA's performance goals. In 1994, the Corporation
achieved growth in earnings per share, and TFBNA achieved return on assets and
an operating efficiency, in the range of goals established under the Plan, and
therefore, a cash incentive was awarded to Mr. Matthews for 1994 as indicated in
the SUMMARY COMPENSATION TABLE.

Under the Corporation's Incentive Stock Option Plans, stock option grants
provide the right to purchase shares of Common Stock at the fair market value
(the average of the bid and asked price) on the date of grant. Options are not
exercisable during the first two years after the date of grant of the option.
The option grants cover shares of Common Stock authorized under stockholder
approved plans. The number of shares covered by each grant reflects the Stock
Option Committee's assessment of the individual's relative value to the
Corporation and is purely a subjective determination by the Committee, with
input from the Chief Executive Officer with respect to all awards other than
those to the Chief Executive Officer.

In December 1994, the Compensation Committee approved the Trans Financial
Bancorp, Inc. 1995 Executive Stock Option Plan, and granted options under the
plan to the Chief Executive Officer and to other executive officers, subject to
shareholder approval of the plan. The plan was based in part on the
recommendations of the compensation consulting firm which the Committee
commissioned in early 1994. The plan was adopted in recognition that the
achievement of the Corporation's objectives will require leadership, effort and
energy on the part of the Corporation's executive officers and will be closely
linked with shareholder value. Grants under the plan will be made to the senior
executives believed to have a critical impact on the attainment of the
Corporation's goals. Generally, each grant of an option under the plan will
consist of a one-time grant and will be awarded in a like amount to executives
at the same management level. Options granted under the plan will expire ten
years from the date of grant and will vest three years from the date of grant.
The exercise price per share for the options granted in December 1994 is $15.75,
which is 120% of the average of the bid and the asked prices of the
Corporation's Common Stock on the business day preceding the date of grant. Mr.
Lester was granted an option to acquire 91,000 shares of Common Stock under the
plan. The size of the award to Mr. Lester was based in part on the
recommendation of the compensation consulting firm and on the Committee's
judgment of Mr. Lester's importance to the attainment of the Corporation's long
term goals.

Under Mr. Lester's Employment Agreement, on January 1, 1994, Mr. Lester was
granted an option to acquire 4,000 shares of the Corporation's common stock
exercisable in July 1994. Mr. Lester exercised the option which had an exercise
price equal to 69% of the market price of the Corporation's stock on January 1,
1991, the date the Employment Agreement was executed, and an exercise price
equal to 36% of the market price of the Corporation's Common Stock on the date
of exercise. Thus, the amount realized by Mr. Lester upon exercise of the option
resulted in part from appreciation in the Corporation's Common Stock price
during Mr. Lester's tenure with the Corporation. The Compensation Committee
believes that the grant, as well as grants made to Mr. Lester under the
Corporation's incentive stock option plans, further encourages long-term
performance, promotes management retention and aligns shareholders' and
managements' interests in the performance of the Corporation's Common Stock.

Awards under the Corporation's Employee Stock Ownership Plan and Savings
Investment Plan are based on a percentage of the base salary of each of the
executive officers as determined under the respective plan. The Corporation's
contributions to these Plans are invested in the Corporation's Common Stock.

Submitted by the Compensation Committee of the Board of Directors

Mary D. Cohron Floyd H. Ellis
David B. Garvin Charles A. Hardcastle
Joseph I. Medalie

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Mr. Hardcastle, a director of the Corporation and of TFBNA and a member of
the Compensation Committee and Stock Option Committee, is the owner of
thirty-eight percent (38%) of the stock of Ashley Center, Inc., which leases a
branch office to TFBNA. The aggregate amount of payments made under the

14
<PAGE>
lease in 1994 was $ , and the aggregate amount of payments due under the
lease for the current term, which expires in April 1997, is $ . Mr.
Hardcastle was not an owner of Ashley Center, Inc. at the time the lease was
negotiated, and the Corporation believes that the terms and conditions of its
relationship with Ashley Center, Inc. are as favorable as those which could have
been obtained from any other third party entity.

PERFORMANCE GRAPH

Set forth below is a line graph comparing the yearly percentage change in
the cumulative total shareowner return on the Corporation's Common Stock against
the cumulative total return of the NASDAQ Market Index and a peer group index
for the period of five fiscal years commencing January 1, 1990 and ending
December 31, 1994. The peer group used in the peer group index, the MG Industry
Group 045-East South Central Banks, consists of Alabama National Bancorp,
AmSouth Bancorp, Banco Central Hispano, Bancorp South, Bank of Nashville,
Cardinal Bancshares, CBT Corporation, Colonial BancGroup, Community Bancshares,
Compass Bancshares, Deposit Guaranty Corporation, Farmers Capital Bank
Corporation, First American Corporation, First City Bancorp, First Federal
Financial, First Tennessee National Corporation, Grenada Sunburst System
Corporation, Hancock Holding Company, Kentucky Enterprise Bancorp, Leader
Financial Corporation, LFS Bancorp, Mid America Bancorp, National Commerce
Bancorporation, Peoples Banctrust Company, Peoples First Corporation, Peoples
Holding Company, Pikeville National Corporation, Regions Financial Corporation,
S.Y. Bancorp, South Alabama Bancorp, SouthTrust Corporation, TF Financial
Corporation, Trans Financial Bancorp, Trustmark Corporation and Union Planters
Corporation.

The performance graph assumes that (i) $100 was invested on January 1, 1990,
and (ii) dividends were reinvested during each fiscal year presented.

PERFORMANCE GRAPH

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
Trans Financial Bancorp, Inc. 100.00 91.40 139.54 183.04 204.54 167.26
NASDAQ Market Index 100.00 88.18 144.25 149.62 158.14 158.80
MG Industry Group 045-East South Central Banks 100.00 81.12 104.14 105.16 126.14 132.44
</TABLE>

<TABLE>
<CAPTION>
1989 1990 1991 1992 1993 1994
<S> <C> <C> <C> <C> <C> <C>
Trans Financial Bancorp, $ 100.00 $ 91.40 $ 139.54 $ 183.04 $ 204.54 $ 167.26
Inc.
NASDAQ Market Index $ 100.00 $ 88.18 $ 144.25 $ 149.62 $ 158.14 $ 158.80
MG Industry Group 045- $ 100.00 $ 81.12 $ 104.14 $ 105.16 $ 126.14 $ 132.44
East South Central Banks
</TABLE>

DIRECTOR COMPENSATION

Non-employee directors of the Corporation receive an annual fee of $2,400,
plus a fee of $250 for each regular Board of Directors meeting attended, $350
for each special Board of Directors meeting attended,

15
<PAGE>
and $150 for each committee meeting attended. Only one fee is paid for joint
committee meetings. Salaried employees of the Corporation or of its subsidiaries
who also serve as directors receive no additional compensation for their
services as directors.

TRANSACTIONS WITH MANAGEMENT AND OTHERS

The Banks have had and expect to have in the future business and banking
transactions in the ordinary course of business with certain of their directors
and executive officers and their associates, as well as with corporations with
which they are connected as directors, officers or shareholders. The banking
transactions which have occurred were on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons. In the opinion of management of the Corporation
and the Banks, such transactions do not involve more than the normal risk of
collectability or present other unfavorable features.

The spouse of Mr. Martin, a director of the Corporation and of TFBNA, is the
owner of approximately fifteen percent (15%) of the Plaza Shopping Center of
Elizabethtown, Inc., which leases a building to TFBNA for use as an operations
facility. The aggregate amount of payments made under the lease in 1994 was
$ , and the aggregate amount of payments due under the lease for the
current term, which expires May 31, 2008, is $ (subject to adjustment).
The Corporation believes that the terms and conditions of its relationship with
Plaza Shopping Center of Elizabethtown, Inc. are as favorable as those which
could have been obtained from a third party.

Mr. Martin is the part owner of an insurance agency, Center of Insurance,
Inc., through which the Corporation and its subsidiaries purchased insurance in
1994. Total insurance premiums paid to Mr. Martin's insurance agency during 1994
were approximately $ .

Mr. Mastrapasqua, a director of the Corporation and of TFB of TN, is the
owner of Mastrapasqua & Associates, Inc., an investment advisory and research
company which has entered into an agreement with the Corporation and TFBNA to
provide investment advisory services to the Corporation and to the Trust
Department of TFBNA. The aggregate amount of fees paid to Mastrapasqua &
Associates, Inc. during 1994 was $ .

In addition, Mastrapasqua & Associates, Inc. subleases from the Corporation,
certain furniture and office space in the Palmer Plaza office building in
Nashville, Tennessee and pays as rental one-half of the rent payable by the
Corporation. The aggregate amount of payments made by Mastrapasqua & Associates,
Inc. under this sublease in 1994 was $ , and the aggregate amount of
payments due from Mastrapasqua & Associates, Inc. under this sublease for the
current term, which expires February 28, 1997, is $ . The Corporation
believes that the terms and conditions of its relationship with Mastrapasqua &
Associates, Inc. are as favorable as those which could have been obtained from a
third party.

Mr. Mastrapasqua is also the owner of 814 Church Street, L.L.C., from which
the Corporation proposes to lease space in a building in Nashville, Tennessee.
The building is currently being refurbished for occupancy by the Corporation and
other tenants, and the Corporation expects to take possession of the leased
space in August 1995. As part of this lease arrangement, 814 Church Street,
L.L.C. has agreed to assume all of the Corporation's liability for lease
payments for space in the Palmer Plaza office building described in the
preceding paragraph. The aggregate amount of payments due to 814 Church Street,
L.L.C. under this lease for the current term, which expires fifteen years after
the Corporation takes possession of the leased space, is $ . The
Corporation believes that the terms and conditions of its relationship with 814
Church Street, L.L.C. are as favorable as those which could have been obtained
from a third party.

Mr. Van Meter, a director of TFBNA and the Corporation, was the owner of an
airplane which he sold to the Corporation on January 2, 1994 for $430,000. In
order to determine the fair price of the airplane, the Corporation solicited
bids for the purchase of similar aircraft with comparable equipment and air
miles flown. The purchase price paid by the Corporation was in the middle range
of the ten bids received. The Corporation sold the airplane in May 1994 for
$415,000 to The Cessna Aircraft Company. The sales price was set at the amount
The Cessna Aircraft Company established for its contemporaneous sale of the
plane to a third party.

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Mr. Van Meter is also part owner of an insurance agency, Van Meter Insurance
Agency, through which, as of January 1, 1995, the Corporation purchases life and
long-term disability insurance for its officers and employees. Van Meter
Insurance Agency was selected as the agent for purchases of this insurance as
part of a bidding process with two other unrelated insurance agencies.

Other transactions between the Corporation or the Banks and management are
described under COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.

PROPOSAL II
APPROVAL OF TRANS FINANCIAL BANCORP, INC.
1995 EXECUTIVE STOCK OPTION PLAN

The Board of Directors of the Corporation adopted, subject to the approval
of its shareholders, the Trans Financial Bancorp, Inc. 1995 Executive Stock
Option Plan (the "Plan"), effective December 19, 1994. The purpose of the Plan
is to promote the interests of the Corporation by affording an incentive to
certain key executive employees to remain in the employ of the Corporation and
to use their best efforts on its behalf, resulting in increased shareholder
value through profitable growth, and to aid the Corporation in attracting,
maintaining, and developing capable personnel of a caliber required to ensure
the continued success of the Corporation. A copy of the Plan is attached to this
Proxy Statement as Appendix A.

At the Annual Meeting, the shareholders of the Corporation will be asked to
approve the Plan. Approval of the Plan by the Corporation's shareholders is
required if executive officers who receive options are to be eligible for the
exemption provided by Rule 16b-3 promulgated under Section 16(b) of the
Securities Exchange Act of 1934. Unless otherwise instructed, it is the
intention of the persons named in the accompanying form of proxy to vote shares
represented by properly executed proxies in favor of the Plan.

SUMMARY OF THE PLAN

The Plan will be administered, interpreted and applied by a committee
("Committee") consisting of not less than three directors, none of whom will
have, at any time for one year prior to appointment to the Committee, been
eligible to receive stock or options under any plan of the Corporation or its
subsidiaries. The Plan provides that only executive officers of the Corporation
and its subsidiaries are eligible to receive an option under the Plan. The
Committee has exclusive jurisdiction to (a) determine the executive officers of
the Corporation and its subsidiaries who will receive options under the Plan,
the number of shares of Common Stock covered by each option, and the time or
times when options will be granted, (b) fix such other provisions of the option
agreement as it may deem necessary or desirable consistent with the terms of the
Plan, and (c) determine all other questions relating to the administration of
the Plan.

A total of 313,000 shares of Common Stock may be issued under the Plan. The
number, price and kind of shares subject to the Plan may be subject to
adjustments in the event of any reorganization, recapitalization, stock split,
stock dividend, combination of shares, merger or consolidation, or any other
change (after the effective date of the Plan) in the nature or number of shares
of Common Stock of the Corporation in order to avoid the dilution of shares
subject to outstanding options and to continue in force outstanding options by
substituting thereunder the option shares of a successor corporation which may
subsequently acquire the Corporation.

The Plan requires that the option price must be equal to 120% of the fair
market value of the shares on the date of the grant, as determined by the
average of the closing bid and asked quotations or the closing high bid
quotation, whichever is available, for the Common Stock in the over-the-counter
market on the immediately preceding business day as reported by the NASDAQ
National Market.

The Plan fixes the maximum term of any option granted under the Plan at ten
years from the date of the grant of the option. The Plan also generally provides
that an option granted may not be exercised within three years from the date of
its grant. Thereafter, options may be exercised in whole or in part.
Notwithstanding the foregoing, upon the death or disability of an optionee or if
there is a Change in Control of the Corporation, as defined in the Plan, all
outstanding options will become immediately exercisable.

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Options granted pursuant to the Plan are not transferable except upon the
death of an optionee, in which event they may be transferred only in accordance
with and to the extent provided for in the laws of descent and distribution of
Kentucky. If any optionee ceases to be employed by the Corporation or its
subsidiaries for any reason other than for total and permanent disability, death
or retirement, the option will immediately lapse and all right to exercise the
optionee's options shall terminate on the earlier of: (a) the date of the
optionee's termination of employment; or (b) the date on which written notice of
such termination is delivered by the Corporation to the optionee. If an optionee
dies while an employee of the Corporation or one of its subsidiaries, or his or
her employment by the Corporation or a subsidiary terminates because of
disability, the optionee's option will become fully exercisable on the date of
the optionee's death or disability and may be exercised by the optionee or his
or her representative for a one year period thereafter, provided the option has
not previously expired. If an optionee's employment with the Corporation or a
subsidiary terminates by reason of retirement, the optionee's option may be
exercised, to the extent the optionee was entitled to exercise the option on the
date of such termination of employment, for a three month period thereafter,
provided the option has not previously expired.

The option price for the Common Stock must be paid in full when the option
is exercised. Subject to such rules as the Committee may impose, the option
price may be paid in whole or in part in (a) cash, (b) whole shares of Common
Stock owned by the optionee evidenced by negotiable certificates, (c) by a
combination of such methods of payment, or (d) such other consideration as shall
constitute lawful consideration for the issuance of Common Stock and be approved
by the Committee (including without limitation, assurance satisfactory to the
Committee from a broker registered under the Securities Exchange Act of 1934 of
the delivery of the proceeds of an imminent sale of the Common Stock to be
issued pursuant to the exercise of such option, such sale to be made at the
direction of the optionee). Moreover, subject to such restrictions, terms and
conditions as the Committee may impose, an optionee may request the Corporation
to "pyramid" the optionee's shares; that is, to automatically apply the shares
which the optionee is entitled to receive on the exercise of a portion of an
option to satisfy the exercise for additional portions of the option, thus
resulting in multiple simultaneous exercises of an option by use of whole shares
as payment.

While the Board of Directors of the Corporation intends to continue the Plan
in effect until the scheduled termination date on December 31, 2005, the Board
may modify, amend or terminate the Plan without a vote of the shareholders;
except that, without approval by shareholders of the Corporation holding not
less than a majority of the votes represented and entitled to be voted at a duly
held meeting of the Corporation's shareholders, no amendment shall be made if
shareholder approval is necessary to continue to qualify the Plan under the
Securities and Exchange Commission Rule 16b-3.

GRANTS MADE SUBJECT TO SHAREHOLDER APPROVAL OF PLAN

Subject to shareholder approval of the Plan, options to purchase an
aggregate of 165,000 shares of Common Stock at an exercise price of $15.75 were
granted on December 19, 1994 to current executive officers as a group. All
options granted under the Plan have an exercise price per share equal to 120% of
the fair market value of a share of stock on the date of grant (the average of
the bid and asked quotations for the Common Stock on the business day preceding
the date of grant, as reported on the NASDAQ National Market) and a term of ten
years from the date of grant. Subject to shareholder approval of the Plan,
options to purchase 91,000 shares of Common Stock were granted to Mr. Lester,
Chief Executive Officer of the Company, and options to purchase 37,000 shares of
Common Stock were granted to each of Mr. Berta, Executive Vice President and
Chief Financial Officer, and Mr. Moser, Senior Vice President -- Marketing.

As of March 1, 1995, the fair market value of the Common Stock for purposes
of the Plan, as reported by NASDAQ, was $ .

FEDERAL INCOME TAX CONSEQUENCES

Generally there will be no income tax consequences to the optionee or the
Corporation when an option is granted under the Plan. When an option is
exercised, the excess of the then fair market value of the Common Stock over the
option price will constitute ordinary income to the optionee and the Corporation
will be entitled to deduct an equal amount as compensation expense.

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Upon disposition of the stock by the employee, long-term or short-term
capital gain or loss, as the case may be, will be recognized, equal to the
difference between the amount realized on such disposition and the basis for the
stock, which will include the amount previously recognized as ordinary income.
The holding period for capital gains purposes will commence on the day the
optionee acquires the shares pursuant to the option.

EFFECT ON POTENTIAL TAKEOVER ATTEMPTS INCLUDING POSSIBLE DISADVANTAGE

While the purpose of the Plan is to promote the interests of the Corporation
by attracting, maintaining and affording an incentive to the Corporation's key
executive officers, certain provisions of the Plan may have an anti-takeover
effect. In the event of a Change in Control, the ability to exercise all
outstanding options will be accelerated. Additionally, in the event of a Change
in Control, the common stock or other comparable securities of the acquiring
entity will be substituted for the Common Stock of the Corporation subject to
the Plan and outstanding options. A "Change in Control" is defined under the
Plan as:

(a) any share exchange or merger or consolidation to which the Corporation
or a Significant Subsidiary of the Corporation is a party, or any
purchase or other acquisition of substantially all of the business or
assets of the Corporation or of any Significant Subsidiary in any
transaction or series of transactions, by another corporation or entity,
if either (i) the Corporation will not be the surviving or acquiring
corporation or will not own 100% of the outstanding capital stock of the
surviving, acquiring or transferee corporate entity immediately following
the consummation of the transactions, or (ii) there will be a 25% change
in the proportionate ownership of outstanding shares of voting stock of
the Corporation as a result of the transactions;

(c) more than 50% of the members of the Board shall not be Continuing
Directors (meaning the directors of the Corporation (A) who are members
of the Board on February 1, 1995, (B) who subsequently became directors
of the Corporation by a vote of a majority of the Continuing Directors
then on the Board of Directors, or (C) whose election or nomination for
election by the Corporation's stockholders was approved by a vote of a
majority of the Continuing Directors then on the Board of Directors); or

The effect of these provisions of the Plan may be to discourage an
unsolicited tender offer or other unsolicited takeover bid for the Corporation's
Common Stock. These provisions of the Plan may make the Corporation a less
attractive takeover target. Additionally, these provisions may encourage persons
desiring to take over or control the Corporation to initiate such action through
negotiations with the then incumbent Board of Directors and management instead
of through a direct offer to the shareholders. The provisions of the Plan could
make the accomplishment of a transaction more difficult or more costly even if
the transaction is favorable to the interests of the shareholders.

The management of the Corporation presently is aware of no specific efforts
to obtain control of the Corporation, either in a friendly or hostile manner.

VOTE REQUIRED

The adoption of this proposal will require the affirmative vote of the
holders of a majority of the outstanding shares of Common Stock of the
Corporation present or represented, and entitled to vote on the proposal.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THIS
PROPOSAL.

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PROPOSAL III
APPROVAL OF TRANS FINANCIAL BANCORP, INC. OUTSIDE
DIRECTOR RESTRICTED STOCK PLAN

The Board of Directors of the Corporation approved, subject to the approval
of the shareholders, the Trans Financial Bancorp, Inc. Outside Directors'
Restricted Stock Plan (the "Directors' Stock Plan"), effective February 20,
1995. The purpose of the Directors' Stock Plan is to provide non-employee
directors of the Corporation or its subsidiaries with a means of acquiring or
increasing their proprietary interest in the Corporation, to retain and motivate
their continuing service to the Corporation and its subsidiaries, and to
increase their incentive to work toward the attainment of the long-term growth
and profit objectives of the Corporation and its subsidiaries. Directors of the
Corporation and its subsidiaries will participate in the Directors' Stock Plan
upon adoption of the Plan by the Corporation or by such subsidiary. It is
anticipated that the Corporation and each of its subsidiaries will adopt the
Plan within the next six months. A copy of the Directors' Stock Plan is attached
to this Proxy Statement as Appendix B.

At the Annual Meeting, the shareholders of the Corporation will be asked to
approve the Directors' Stock Plan. Approval of the Directors' Stock Plan by the
Corporation's shareholders is required if the directors who receive grants of
restricted stock are to be eligible for the exemption provided by Rule 16b-3
promulgated under Section 16(b) of the Securities Exchange Act of 1934. Unless
otherwise instructed, it is the intention of the persons named in the
accompanying form of proxy to vote shares represented by properly executed
proxies in favor of the Directors' Stock Plan.

SUMMARY OF THE DIRECTORS' STOCK PLAN

Upon adoption of the Directors' Stock Plan by the Corporation or any
subsidiary, directors of the Corporation or the subsidiary, including advisory
directors, will receive their compensation as directors (exclusive of attendance
fees) in shares of the Corporation's Common Stock, subject to certain
restrictions on transferability which are discussed under the heading
"Restrictions" (the "Restricted Shares").

The award of Restricted Shares is determined by dividing the director's
annual rate of remuneration (exclusive of attendance fees) by the fair market
value of the shares. Under the Directors' Stock Plan, the fair market value of
the shares equals the average of the daily averages of the high and low sales
price of the shares for the 5 consecutive trading days immediately preceding the
annual shareholders' meeting or the first day of the director's term of office.
Fractional shares are computed to the nearest whole share. Non-employee
directors of the Corporation are currently compensated at the annual rate of
$2,400. Upon adoption of the Directors' Stock Plan, each such director would be
entitled to receive Restricted Shares having a market value of $2,400. The
specific number of shares to be issued in each year will depend on the then
current rate of annual remuneration and the per share price for the
Corporation's Common Stock during the relevant period prior to the grant.

RESERVATION OF SHARES

The total number of shares reserved for grant under the Directors' Stock
Plan may not exceed . Those shares will consist of authorized but
unissued shares. If any shares subject to grants are forfeited, the forfeited
shares will become available for reissuance under the Directors' Stock Plan.

RESTRICTIONS

Restricted Shares may not be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution, until the first to occur of: (a) the earlier of one
year after the date of grant or the expiration of the director's term of office
for which the grant relates, (b) the grantee's death, (c) the involuntary
termination of the grantee's status as a director, or (d) a change in control of
the Corporation. In no event, however, will the Restricted Shares be
transferrable and free of restrictions before the expiration of a 6 month period
beginning the first day of the director's term of office, or, if later, the date
of issuance of the Restricted Shares.

All Restricted Shares will bear a legend citing the restrictions contained
in the Directors' Stock Plan. When the restrictions lapse, the grantee is
entitled to have the legend removed from any shares or

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certificates. Restrictions are lifted automatically upon the expiration of the
period to which the restrictions apply. If a director voluntarily terminates his
or her status as a director before the expiration of the period of restriction,
any shares still subject to restriction are immediately forfeited.

RIGHTS

Grantees holding Restricted Shares may exercise full voting rights with
respect to those shares and are entitled to receive all dividends and other
distributions paid with respect to those shares. If any dividends or other
distributions are paid in shares, these shares are also subject to the same
restrictions on transferability as the Restricted Shares with respect to which
they are paid.

ADJUSTMENTS IN CAPITALIZATION

If the outstanding shares of Common Stock of the Corporation are changed
because of a stock dividend, stock split, recapitalization, merger,
consolidation, combination, stock rights plan or exchange of shares or other
similar corporate change, the aggregate number of shares which may be issued
under the Directors' Stock Plan are to be adjusted by the ineligible members of
the Board of Directors of the Corporation. Those members have the discretion to
make appropriate adjustments in the number and type of shares subject to
restricted share grants then outstanding under the Directors' Stock Plan
according to such grants or otherwise.

AMENDMENTS AND TERMINATION

The Board of Directors may amend, modify, alter or terminate the Directors'
Stock Plan at any time. The Directors' Stock Plan may not, however, be amended
more frequently than once every six months. In addition, without the approval by
shareholders holding not less than a majority of the shares present or
represented and entitled to be voted at a duly held meeting of the Corporation's
shareholders, no amendment shall be made if shareholder approval is necessary to
continue to qualify the Directors' Stock Plan under the SEC Rule 16b-3.

VOTE REQUIRED

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THIS
PROPOSAL.

PROPOSAL IV
AMENDMENT OF ARTICLE I OF THE ARTICLES OF INCORPORATION

Article I of the Corporation's articles of incorporation establishes the
name of the Corporation as "Trans Financial Bancorp, Inc." At the Annual
Meeting, the shareholders will be asked to approve the Board of Directors'
proposal that the articles of incorporation be amended to change the name of the
Corporation to "Trans Financial, Inc."

The Corporation was originally organized in 1984 as a one-bank holding
company for TFBNA. Since that time, the Corporation has grown significantly,
and, in addition to acquiring additional banks and savings and loan
associations, has made significant progress in diversifying the products and
services offered through its various subsidiaries, beyond those offered by a
typical banking organization. The Board of Directors believes that it is
important to continue this effort to offer additional products and services
through various delivery mechanisms. The Board of Directors believes that the
Corporation has become a financial services company and not just a banking
company, and believes it is appropriate and important to reflect this change in
the name of the Corporation.

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VOTE REQUIRED

The adoption of this proposal will require the affirmative vote of the
holders of a majority of the outstanding shares of Common Stock of the
Corporation voted on the proposal, assuming a quorum is present.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THIS
PROPOSAL.

RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS

For the years ended December 31, 1992, 1993 and 1994, the accounting firm of
KPMG Peat Marwick served as the Corporation's and the Banks' independent public
accountants and auditors. Upon the recommendation of management, the Board of
Directors has approved the selection of KPMG Peat Marwick to serve as the
Corporation's independent public accountants and auditors for the year ending
December 31, 1995.

A representative from the firm of KPMG Peat Marwick is expected to be
present at the Annual Meeting and will be available to make a statement should
he desire to do so, and respond to questions of the shareholders.

SHAREHOLDER PROPOSALS AND OTHER MATTERS

In order to be included in the Corporation's proxy statement and proxy for
the annual meeting of the shareholders of the Corporation in 1996, any proposals
which a shareholder intends to present at that meeting must be received by the
Secretary of the Corporation not later than November 8, 1995.

Any shareholder may strike out the names of the proxies designated by the
Board of Directors on the form of proxy and may write in and substitute the name
of any other person and may deliver the revised form of proxy to such other
person whom the shareholder may wish to designate as proxy for the purpose of
representing the shareholder at the Annual Meeting.

At the time of preparation of this proxy material, the Corporation knows of
no other matters to be presented for action at the Annual Meeting. If any other
matters are properly brought before the Annual Meeting, the persons named in the
accompanying proxy card intend to vote the shares represented thereby in
accordance with their judgment.

By Order of the Board of Directors,

Jay B. Simmons
Secretary

Bowling Green, Kentucky
March 8, 1995

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APPENDIX A
TRANS FINANCIAL BANCORP, INC.
1995 EXECUTIVE STOCK OPTION PLAN

1. PURPOSE. The purpose of the Trans Financial Bancorp, Inc. 1995
Executive Stock Option Plan is to promote the interests of the Company by
affording an incentive to certain key executive employees to remain in the
employ of the Company and its Subsidiaries and to use their best efforts on its
behalf, resulting in increased shareholder value through profitable growth; and
further to aid the Company and its Subsidiaries in attracting, maintaining, and
developing capable personnel of a caliber required to ensure the continued
success of the Company and its Subsidiaries through the opportunity for stock
ownership offered under this Plan.

2. DEFINITIONS.

A. BOARD. The word "Board" means the Company's Board of Directors.

B. CHANGE IN CONTROL. The term Change in Control means: [a] any share
exchange or merger or consolidation to which the Company or a Significant
Subsidiary of the Company is a party, or any purchase or other acquisition
of substantially all the business or assets of the Company or any
Significant Subsidiary in any transaction or series of transactions, by
another corporation or entity, if either [i] the Company will not be the
surviving or acquiring corporation or will not own 100% of the outstanding
capital stock of the surviving, acquiring or transferee corporate entity
immediately following the consummation of the transactions contemplated by
the plan or agreement of exchange, merger, consolidation, or sale of assets,
or [ii] there will be a twenty-five percent (25%) change in the
proportionate ownership of outstanding shares of voting stock of the Company
as a result of the transactions contemplated by such plan or agreement of
exchange, merger, consolidation or sale of assets; [b] any person (as that
term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes
the beneficial owner (as that term is used in Section 13(d) of the Exchange
Act) of stock of the Company entitled to cast more than 20% of the votes at
the time entitled to be cast generally for the election of directors; [c]
more than 50% of the members of the Board shall not be Continuing Directors
(which term, as used herein, means the directors of the Company (x) who are
members of the Board on December 19, 1994 or (y) who subsequently became
directors of the Company by a vote of a majority of the Continuing Directors
then on the Board of Directors, or whose election or nomination for election
by the Company's stockholders was approved by a vote of a majority of the
Continuing Directors then on the Board of Directors); or [d] the Board or
the shareholders of the Company approve, adopt, agree to recommend, or
accept any agreement, contract, offer or other arrangement providing for, or
any series of transactions resulting in, any of the transactions described
above.

C. CODE. The word "Code" means the Internal Revenue Code of 1986, as
amended.

D. COMMON STOCK. The term "Common Stock" means the Company's common
stock or the common stock or securities of a Successor that have been
substituted therefor pursuant to Section 9.

E. COMPANY. The word "Company" means Trans Financial Bancorp, Inc., a
Kentucky corporation, with its principal place of business at 500 East Main
Street, Bowling Green, Kentucky 42101.

F. DISABILITY. The word "Disability" means, as defined by and to be
construed in accordance with Code Section 22(e)(3), any medically
determinable physical or mental impairment which can be expected to result
in death or which has lasted or can be expected to last for a continuous
period of not less than twelve (12) months, and which renders the Optionee
unable to engage in any substantial gainful activity. An Optionee shall not
be considered to have a Disability unless the Optionee furnishes proof of
the existence thereof in a such form and manner, and at such time, as the
Plan Committee may require.

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G. EXCHANGE ACT. The term "Exchange Act" means the Securities Exchange
Act of 1934, and the rules and regulations promulgated thereunder as amended
from time to time.

H. OPTION PRICE. The term "Option Price" means the price to be paid
for Common Stock upon the exercise of an option granted under the Plan, in
accordance with Section 7.B.

I. OPTIONEE. The word "Optionee" means an employee to whom options
have been granted under the Plan.

J. OPTIONEE REPRESENTATIVE. The term "Optionee Representative" means
the personal representative of the Optionee's estate, and after final
settlement of the Optionee's estate, the successor or successors entitled
thereto by law.

K. PLAN. The word "Plan" means the Trans Financial Bancorp, Inc. 1995
Executive Stock Option Plan, as set forth herein, and as amended from time
to time.

L. PLAN COMMITTEE. The term "Plan Committee" means the committee
appointed by the Board to administer the Plan, pursuant to Section 4.

M. SIGNIFICANT SUBSIDIARY. The term "Significant Subsidiary" means any
Subsidiary which meets either of the following: [i] the assets of the
Subsidiary exceed forty percent (40%) of the total consolidated assets of
the Company as of the end of the most recently completed fiscal year; or
[ii] the Subsidiary's income from continuing operations before income taxes
and extraordinary items exceeds forty percent (40%) of the consolidated
income of the Company as of the most recently completed fiscal year.

N. SUBSIDIARY. The word "Subsidiary" means, as defined in Code Section
424(f), any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if, at the time of the granting of
an option under the Plan, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock of one of
the other corporations in such chain.

O. SUCCESSOR. The word "Successor" means the entity surviving a merger
or consolidation with the Company, or the entity that acquires all or a
substantial portion of the Company 's assets or outstanding capital stock
(whether by merger, purchase or otherwise).

3. SHARES SUBJECT TO PLAN.

A. AUTHORIZED UNISSUED SHARES. Subject to the provisions of Section 9,
the shares to be delivered upon exercise of options granted under the Plan
shall be made available, at the discretion of the Board, from the authorized
unissued shares of Common Stock.

B. AGGREGATE NUMBER OF SHARES. Subject to adjustments and
substitutions made pursuant to the provisions of Section 9, the aggregate
number of shares that may be issued upon exercise of all options that may be
granted under the Plan shall not exceed three hundred thirteen thousand
(313,000) of the Company's authorized shares of Common Stock.

C. SHARES SUBJECT TO EXPIRED OPTIONS. If any option granted under the
Plan expires or terminates for any reason without having been exercised in
full in accordance with the terms of the Plan, the shares of Common Stock
subject to, but not delivered under, such option shall become available for
any lawful corporate purpose, including for transfer pursuant to other
options granted to the same employee or other employees without decreasing
the aggregate number of shares of Common Stock that may be granted under the
Plan.

4. ADMINISTRATION. The Plan shall be administered by the Plan Committee,
whose membership shall be determined and reviewed from time to time by the
Board. The Plan Committee shall consist of not less than three (3) members of
the Board who are not and have not at any time for one (1) year prior to
appointment to the Plan Committee been eligible to receive stock or options
under any plan of the Company or any of its affiliates. Members of the Plan
Committee shall be subject to any additional restrictions

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necessary to satisfy the requirements for disinterested administration of the
Plan as set forth in Rule 16b-3 under the Exchange Act. The Plan Committee shall
have full power and authority to construe, interpret, and administer the Plan
and may from time to time adopt such rules and regulations for carrying out the
Plan as it may deem proper and in the best interests of the Company. The
interpretation of any provisions of the Plan by the Committee shall be final,
conclusive, and binding upon all persons and the officers of the Company shall
place into effect and shall cause the Company to perform its obligations under
the Plan in accordance with the determinations of the Plan Committee in
administering the Plan. The decision of a majority of the members of the Plan
Committee shall constitute the decision of the Plan Committee and the Plan
Committee may act either at a meeting at which a majority of the members of the
Plan Committee is present, or by a writing signed by all of the members of the
Plan Committee.

5. GRANT OF OPTIONS. Subject to the terms, provisions and conditions of
the Plan, the Plan Committee shall have exclusive jurisdiction: [i] to select
executive officers of the Company and its subsidiaries to participate in the
Plan; [ii] to determined the number of shares covered by each option, [iii] to
determine the time or times when options will be granted; [iv] to fix such other
provisions of the option agreement as it may deem necessary or desirable
consistent with the terms of the Plan; and [v] to determine all other questions
relating to the administration of the Plan.

6. ELIGIBILITY. Stock options under the Plan may be granted only to
executive officers of the Company and/or its subsidiaries.

7. TERMS AND CONDITIONS OF OPTIONS. Each option granted under the Plan
shall be evidenced by an option agreement signed by the Optionee and by a member
of the Plan Committee on behalf of the Company. An option agreement shall
constitute a binding contract between the Company and the Optionee, and every
Optionee, upon acceptance of such option agreement, shall be bound by the terms
and restrictions of the Plan and of the option agreement. Such agreement shall
be subject to the following express terms and conditions and to such other terms
and conditions that are not inconsistent with the Plan as the Plan Committee may
deem appropriate.

A. OPTION EXERCISE PERIOD. No option granted under the Plan shall be
exercisable until the expiration of three (3) years from the date of grant
of the option. Thereafter, the option may be exercised, in whole or in part,
at any time before its lapse. Notwithstanding the foregoing, the option
shall become fully exercisable in the event of the Optionee's termination of
employment with the Company or a Subsidiary because of the Optionee's death
or Disability in accordance with Section 7.C, and in the event of a Change
in Control in accordance with Section 7.D. The option shall lapse at the
earliest of the following times:

(1) ten (10) years after the date of grant; or

(2) three (3) months after termination of employment with the Company
or a Subsidiary because of Optionee's retirement in accordance with the
terms of the Company's tax-qualified retirement plans or with the consent
of the Plan Committee; or

(3) one (1) year after termination of employment with the Company or
a Subsidiary because of Optionee's death or Disability; or

(4) the earlier of: [i] the date of Optionee's termination of
employment for reasons other than death, Disability or retirement; or
[ii] the date on which written notice of such termination is delivered by
the Company to the Optionee upon termination of employment with the
Company or a Subsidiary for reasons other than death, Disability or
retirement.

B. OPTION PRICE. The Option Price per share of Common Stock shall be
one hundred twenty percent (120%) of the fair market value of the Common
Stock on the date of grant. The fair market value of Common Stock shall be
determined by the average of the closing bid and asked quotations or the
closing high bid quotation, whichever is available, for the Common Stock in
the over-the-counter

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market, as reported by the National Association of Securities Dealers
Automated Quotation System National Market, on the business day immediately
preceding the date of grant. The Option Price shall be subject to
adjustments in accordance with the provisions of Section 9 herein.

C. EXERCISE IN THE EVENT OF DEATH OR TERMINATION OF EMPLOYMENT.

(1) DEATH. If an Optionee dies while an employee of the Company or
a Subsidiary, the Optionee's options shall become fully exercisable
on the date of the Optionee's death and may be exercised by the
Optionee's Representative at any time, or from time to time, but not
later than the expiration date specified in Section 7.A or one (1) year
after the Optionee's death, whichever date is earlier.

(2) DISABILITY. If an Optionee's employment by the Company or a
Subsidiary terminates because of the Optionee's Disability, the
Optionee's options shall become fully exercisable on the date of the
Optionee's termination of employment, and may be exercised at any time,
or from time to time, but not later than the expiration date specified in
Section 7.A or one (1) year after termination of Optionee's employment,
whichever date is earlier.

(3) RETIREMENT. If an Optionee's employment with the Company or a
Subsidiary terminates by reason of Optionee's retirement in
accordance with the terms of the Company's tax-qualified retirement plans
or with the consent of the Plan Committee, the Optionee may exercise
options granted to Optionee under the Plan, to the extent the Optionee
was entitled to exercise the option on the date of Optionee's termination
of employment, at any time, or from time to time, but not later than the
expiration of the date specified in Section 7.A, or three (3) months of
termination of employment, whichever date is earlier.

(4) TERMINATION OF EMPLOYMENT FOR REASONS OTHER THAN DEATH,
DISABILITY OR RETIREMENT. If an Optionee's employment with the
Company or a Subsidiary terminates for any reason other than death,
Disability or retirement, whether such termination is by the Company,
either with or without cause, or by the Optionee, all right to exercise
the Optionee's options shall terminate on the earlier of: [i] date of
Optionee's termination of employment; or [ii] the date on which written
notice of such termination is delivered by the Company to the Optionee.

D. ACCELERATION. Notwithstanding the provisions of Section 7.B, if
there is a Change in Control, then the exercise dates of all outstanding
options shall accelerate so that each option outstanding may be exercised on
or after the date of the Change in Control.

E. LEAVES OF ABSENCE. The Plan Committee may, in its discretion, treat
all or any portion of any period during which an Optionee is on military or
on an approved leave of absence from the Company or a Subsidiary as a period
of employment of such Optionee by the Company or Subsidiary for purposes of
the Plan. Notwithstanding the foregoing, if a leave of absence exceeds
ninety (90) days and reemployment is not guaranteed by contract or statute,
the Optionee's employment by the Company or a Subsidiary for the purposes of
the Plan shall be deemed to have terminated on the 91st day of the leave.

F. MANNER OF EXERCISE. To exercise an option, the Optionee shall
deliver to the Company: [i] seven (7) days' prior written notice specifying
the number of shares as to which the option is being exercised and, if
determined by counsel for the Company to be necessary, representing that
such shares are being acquired for investment purposes only and not for
purpose of resale or distribution; and [ii] payment by the Optionee, or a
broker-dealer (as provided in Section 7.G), for such shares of the Option
Price for the number of shares with respect to which the option is
exercised. On or before the expiration of the seven (7) day notice period,
and provided that all conditions precedent contained in the Plan are
satisfied, the Company shall, without transfer or issuance tax or other
incidental expenses to Optionee, deliver to Optionee, at the offices of the
Company, a certificate or certificates for the Common Stock. If Optionee
fails to accept delivery of the Common Stock, the Optionee's rights to
exercise the applicable portion of the option shall terminate.

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G. PAYMENT FOR SHARES. Except as otherwise provided in this Section 7,
the Option Price for the Common Stock shall be paid in full when the option
is exercised. Subject to such rules as the Committee may impose, the Option
Price may be paid in whole or in part in [i] cash, [ii] whole shares of
Common Stock owned by the Optionee evidenced by negotiable certificates,
[iii] by a combination of such methods of payment, or [iv] such other
consideration as shall constitute lawful consideration for the issuance of
Common Stock and be approved by the Committee (including without limitation,
assurance satisfactory to the Committee from a broker registered under the
Exchange Act of the delivery of the proceeds of an imminent sale of the
Common Stock to be issued pursuant to the exercise of such option, such sale
to be made at the direction of the Optionee). Moreover, subject to such
restrictions, terms and conditions as the Committee may impose, an Optionee
may request the Company to "pyramid" the Optionee's shares; that is, to
automatically apply the shares which the Optionee is entitled to receive on
the exercise of a portion of an option to satisfy the exercise for
additional portions of the option, thus resulting in multiple simultaneous
exercises of an option by use of whole shares as payment. If payment of the
Option Price is made in Common Stock, the value of the Common Stock used for
payment of the Option Price shall be the fair market value of the Common
Stock, determined in accordance with Section 7.B, on the business day
preceding the day written notice of exercise is delivered to the Company.

H. EXERCISES CAUSING LOSS OF COMPENSATION DEDUCTION. No part of an
option may be exercised to the extent the exercise would cause the Optionee
to have compensation from the Company and its affiliated companies for any
year in excess of $1 million and which is nondeductible by the Company and
its affiliated companies pursuant to Code Section 162(m) and the regulations
issued thereunder. Any option not exercisable because of this limitation
shall continue to be exercisable in any subsequent year in which the
exercise would not cause the loss of the Company's or its affiliated
companies' compensation tax deduction, provided such exercise occurs before
lapse of the option, and otherwise complies with the terms and conditions of
the Plan and option agreement.

I. INVESTMENT REPRESENTATION. Each option agreement may provide that,
upon demand by the Plan Committee for such a representation, the Optionee or
Optionee's Representative shall deliver to the Plan Committee at the time of
any exercise of an option or portion thereof a written representation that
the shares to be acquired upon such exercise are to be acquired for
investment and not for resale or with a view to the distribution thereof.
Upon such demand, delivery of such representation before delivery of Common
Stock issued upon exercise of an option and before expiration of the option
period shall be a condition precedent to the right of the Optionee or
Optionee's Representative to purchase Common Stock.

J. TRANSFERABILITY OF OPTIONS. An option granted under the Plan may
not be transferred by the Optionee otherwise than by will or the laws of
descent and distribution, and during the lifetime of the Optionee to whom
granted, may be exercised only by such Optionee.

K. NO RIGHTS AS SHAREHOLDER. No Optionee or Optionee's Representative
shall have any rights as a shareholder with respect to Common Stock subject
to Optionee's option before the date of transfer to the Optionee of a
certificate or certificates for such shares.

L. NO RIGHTS TO CONTINUED EMPLOYMENT. The Plan and any option granted
under the Plan shall not confer upon any Optionee any right with respect to
continuance of employment by the Company or any Subsidiary, nor shall it
interfere in any way with the right of the Company or any Subsidiary by
which an Optionee is employed to terminate Optionee's employment at any
time.

8. COMPLIANCE WITH OTHER LAWS AND REGULATIONS. The Plan, the grant and
exercise of options thereunder, and the obligation of the Company to sell and
deliver Common Stock under such options, shall be subject to all applicable
federal and state laws, rules and regulations and to such approvals by any
government or regulatory agency as may be required. The Company shall not be
required to issue or deliver any certificates for Common Stock before [i] the
listing of the Common Stock on any stock exchange

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or over-the-counter market on which the Common Stock may then be listed and [ii]
the completion of any qualification of any governmental body which the Company
shall, in its sole discretion, determine to be necessary or advisable.

9. CAPITAL ADJUSTMENTS AFFECTING STOCK, MERGERS AND CONSOLIDATIONS.

A. CAPITAL ADJUSTMENTS. In the event of capital adjustment after the
effective date of the Plan in the Common Stock of the Company by reason of
any reorganization, recapitalization, stock split, stock dividend,
combination or exchange of shares, merger or consolidation, or any other
change (after the effective date of the Plan) in the nature or number of
shares of Common Stock of the Company, a proportionate adjustment shall be
made in the maximum number and kind of shares which may be delivered under
the Plan, and in the Option Price under and the number and kind of shares of
Common Stock covered by outstanding options granted under the Plan. By
virtue of such a capital adjustment, the price of any share under option
shall be adjusted so that there will be no change in the aggregate purchase
price payable upon exercise of any such option.

B. CHANGE IN CONTROL. Without limiting the generality of the
foregoing, if there is a Change in Control and as a result of the
transactions contemplated by the Change in Control, a Successor will acquire
all or a substantial portion of the assets or outstanding capital stock of
the Company, then the kind of shares of common stock which shall be subject
to the Plan and to each outstanding option shall automatically be converted
into and replaced by shares of common stock, or such other class of equity
securities having rights and preferences no less favorable than common stock
of the Successor, and the number of shares subject to the options and the
purchase price per share upon exercise of the options shall be
correspondingly adjusted, so that, by virtue of such Change in Control of
the Company, each Optionee shall have the right to purchase [i] that number
of shares of the Successor which, as of the date of the Change in Control,
have a fair market value equal to the fair market value of the shares of the
Company theretofore subject to an option, [ii] for a purchase price per
share which, when multiplied by the number of shares of the Successor
subject to the option, shall equal the aggregate exercise price at which the
Optionee could have acquired shares of the Company under such option.

C. NO EFFECT ON COMPANY'S RIGHTS. The granting of an option pursuant
to the Plan shall not affect in any way the right and power of the Company
to make adjustments, reorganizations, reclassifications, or changes of its
capital or business structure or to merge, consolidate, dissolve, liquidate,
sell or transfer all or any part of its business or assets.

10. TAX WITHHOLDING. Upon the exercise of an option granted by the Plan,
the Company shall have the right to withhold from any payment due to Optionee or
Optionee's Representative, or to require Optionee or Optionee's Representative
to remit to the Company, an amount sufficient to satisfy all federal, state and
local withholding tax requirements; alternatively, the Company shall have the
right to retain Common Stock otherwise payable to the Optionee or Optionee's
Representative pursuant to exercise of the option in an amount sufficient to
satisfy such withholding requirements before delivery to the Optionee or
Optionee's Representative any certificate(s) for shares of Common Stock.

11. AMENDMENT, SUSPENSION, OR TERMINATION. The Board shall have the right,
at any time, to amend, suspend or terminate the Plan in any respect that it may
deem to be in the best interests of the Company, except that, without approval
by shareholders of the Company holding not less than a majority of the votes
represented and entitled to be voted at a duly held meeting of the Company's
shareholders, no amendment shall be made if shareholder approval is necessary to
continue to qualify the Plan under the Securities and Exchange Commission Rule
16b-3.

12. EFFECTIVE DATE, TERM AND APPROVAL. The effective date of the Plan
shall be December 19, 1994. The Plan was adopted by the Compensation Committee
of the Board on December 19, 1994 and by the Board on , subject
to approval by stockholders of the Company holding not less than a majority of
the shares represented and entitled to vote at its 1995 annual meeting on April
24, 1995. The Plan shall terminate on December 31, 2005, and no options may be
granted under the Plan after such time, but any option granted prior thereto may
be exercised in accordance with its terms.

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13. GOVERNING LAW; SEVERABILITY. The Plan shall be governed by the laws of
the Commonwealth of Kentucky. The invalidity or unenforceability of any
provision of the Plan or any option granted pursuant to the Plan shall not
affect the validity and enforceability of the remaining provisions of the Plan
and the options granted hereunder, and such invalid or unenforceable provision
shall be stricken to the extent necessary to preserve the validity and
enforceability of the Plan and the options granted hereunder.

Dated this day of February, 1995, but effective as of December 19, 1994.

TRANS FINANCIAL BANCORP, INC.
By: __________________________________
Title: _____________________________

ATTEST:
___________________________________________
Jay B. Simmons, Secretary

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APPENDIX B

TRANS FINANCIAL BANCORP, INC.
OUTSIDE DIRECTORS' RESTRICTED STOCK PLAN

SECTION 1. ESTABLISHMENT. Trans Financial Bancorp, Inc. hereby establishes
a restricted stock plan for the outside directors of Trans Financial Bancorp,
Inc. and its subsidiaries, as described herein, which shall be known as the
Trans Financial Bancorp, Inc. Outside Directors' Restricted Stock Plan.

SECTION 2. DEFINITIONS. Whenever used herein, the following terms shall
have the meanings set forth below:

A. "Attendance Fees" mean any remuneration paid to a Director for attending
Board meetings and meetings of the Board committees.

B. "Board" means the Board of Directors of the Corporation or any
subsidiary of the Corporation.

C. "Change in Control" means : [a] any share exchange or merger or
consolidation to which the Company or a Significant Subsidiary of the Company is
a party, or any purchase or other acquisition of substantially all the business
or assets of the Company or any Significant Subsidiary in any transaction or
series of transactions, by another corporation or entity, if either [i] the
Company will not be the surviving or acquiring corporation or will not own 100%
of the outstanding capital stock of the surviving, acquiring or transferee
corporate entity immediately following the consummation of the transactions
contemplated by the plan or agreement of exchange, merger, consolidation, or
sale of assets, or [ii] there will be a twenty-five percent (25%) change in the
proportionate ownership of outstanding shares of voting stock of the Company as
a result of the transactions contemplated by such plan or agreement of exchange,
merger, consolidation or sale of assets; [b] any person (as that term is used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the beneficial owner
(as that term is used in Section 13(d) of the Exchange Act) of stock of the
Company entitled to cast more than 20% of the votes at the time entitled to be
cast generally for the election of directors; [c] more than 50% of the members
of the Board shall not be Continuing Directors (which term, as used herein,
means the directors of the Company (x) who are members of the Board on December
19, 1994 or (y) who subsequently became directors of the Company by a vote of a
majority of the Continuing Directors then on the Board of Directors, or whose
election or nomination for election by the Company's stockholders was approved
by a vote of a majority of the Continuing Directors then on the Board of
Directors); or [d] the Board or the shareholders of the Company approve, adopt,
agree to recommend, or accept any agreement, contract, offer or other
arrangement providing for, or any series of transactions resulting in, any of
the transactions described above.

D. "Compensation Committee" means the Compensation Committee of the Board of
the Corporation.

E. "Corporation" means Trans Financial Bancorp, Inc.

F. "Director" means each and every member of the Board of the Corporation
and its subsidiaries, including advisory directors.

G. "Effective Date" means , 1995; PROVIDED, HOWEVER, that no
Shares shall be granted under the Plan until the approval of the Plan by the
shareholders of the Corporation in accordance with Section 4 hereof, and, with
respect to each Participating Employer, until such Participating Employer shall
have elected to participate in the Plan.

H. "Eligible Director" means each Director of a Participating Employer who
is not also an employee of the Corporation or any subsidiary. No member of the
Board who is also an employee of the Corporation or any subsidiary shall be
eligible to participate in this Plan.

I. "Grantee" means each Eligible Director.

J. "Participating Employer" means each of the Corporation and its
subsidiaries which elects, by resolution of its Board of Directors, to
participate in the Plan.

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K. "Period of Restriction" means the period during which the transfer of
restricted Shares granted under the Plan is restricted pursuant to Section 11
hereof.

L. "Plan" means the Trans Financial Bancorp, Inc. Outside Directors'
Restricted Stock Plan as described herein or as from time to time hereinafter
amended.

M. "Shares" means the common stock, without par value, of the Corporation.

N. "Term of Office" means the period that a Director is elected to serve on
the Board of the Corporation or any subsidiary, whichever is applicable;
PROVIDED, HOWEVER, that as to any Term of Office which began before the date on
which a Participating Employer elects to participate in the Plan (the
"Participation Date") but ends after such date, Term of Office shall mean the
period remaining in such Term of Office after the Participation Date.

O. "1934 Act" means the Securities Exchange Act of 1934, as amended.

SECTION 3. PURPOSE. The purpose of the Plan is to enable the Corporation
and its subsidiaries to retain and motivate their outside Directors who provide
valuable service to them and to provide them with a means of acquiring or
increasing a proprietary interest in the Corporation so that they shall have an
increased incentive to work toward the attainment of the long-term growth and
profit objectives of the Corporation and its subsidiaries.

SECTION 4. SHAREHOLDER APPROVAL. The Plan shall be conditioned upon the
approval of the Plan by the holders of a majority of the Shares present, or
represented, and entitled to vote at the Corporation's 1995 annual shareholders'
meeting.

SECTION 5. ELIGIBILITY. Each Eligible Director shall receive restricted
Share grants under the Plan; PROVIDED, HOWEVER, that no grant of restricted
Shares shall be made to an Eligible Director until such Director consents in
writing to abide by the restrictions imposed on the Shares granted to him or
her.

SECTION 6. ADMINISTRATION. The Plan shall be administered by the
Compensation Committee of the Board of the Corporation. The decision of a
majority of the members of the Compensation Committee shall constitute the
decision of the Compensation Committee, and the Compensation Committee may act
either at a meeting, including a telephonic meeting, at which a majority of its
members are present or by a written consent signed by all of its members. The
Compensation Committee may appoint individuals to act on its behalf in the
administration of the Plan; PROVIDED, HOWEVER, that except as otherwise provided
by the Plan, the Compensation Committee shall have the sole, final and
conclusive authority to administer, construe and interpret the Plan.
Notwithstanding anything contained in this section to the contrary, no member of
the Compensation Committee may vote or act with respect to any administrative
decision or interpretation which directly or indirectly affects his, but not all
Grantees', interests under the Plan.

SECTION 7. NUMBER OF SHARES SUBJECT TO THE PLAN. The total number of
Shares that may be granted under the Plan may not exceed One Hundred and Twenty
Thousand (120,000) Shares, subject to adjustment as provided in Section 9
hereof. Those Shares shall consist of authorized but unissued Shares not
reserved for any other purpose.

SECTION 8. UNUSED SHARES. In the event any Shares subject to grants made
under the Plan are forfeited pursuant to Section 15 hereof, such forfeited
Shares shall again become available for issuance under the Plan.

SECTION 9. ADJUSTMENTS IN CAPITALIZATION. In the event of any change in
the outstanding Shares by reason of a stock dividend, stock split,
recapitalization, merger, consolidation, combination, stock rights plan or
exchange of shares or other similar corporate change, the aggregate number of
Shares issuable under the Plan shall be appropriately adjusted by the members of
the Board of the Corporation who are not eligible to participate in the Plan,
whose determination shall be conclusive. In such event, the members of the Board
of the Corporation who are not eligible to participate in the Plan shall also
have discretion to make appropriate adjustments in the number and type of Shares
subject to restricted Share grants then outstanding under the Plan pursuant to
the terms of such grants or otherwise.

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SECTION 10. GRANT OF RESTRICTED SHARES. An Eligible Director shall be
entitled to a grant of Shares for any Term of Office ending after the Effective
Date. As soon as practicable after the annual meeting of shareholders, in the
case of the Corporation, and after the beginning of each Term of Office in the
case of each subsidiary of the Corporation, the Secretary of the Corporation
shall cause to be issued to each Grantee a number of restricted Shares
determined by dividing [i] the Grantee's annual rate of remuneration (exclusive
of any Attendance Fees) from the Corporation or the subsidiary in effect on such
date by [ii] the average of the daily averages of the high and low sales price
of the Shares (as reported by the NASDAQ National Market), for the five (5)
consecutive trading days immediately preceding the date of the annual
shareholders' meeting, in the case of the Corporation, or the first day of such
Term of Office, in the case of any subsidiary of the Corporation, rounding up or
down any fractional Share to the nearest whole Share.

SECTION 11. RESTRICTIONS ON TRANSFERABILITY. Until the lifting of the
restrictions on the Shares granted under Section 10 hereof, no shares granted
under Section 10 of the Plan may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, otherwise than by will or by the laws of
descent and distribution. The Period of Restriction with respect to any Share
granted under Section 10 share expire upon the first to occur of the following:

A. the earlier of one year or the expiration of the Term of Office for which
the grant relates without effect to any extension of such Term of Office because
of the failure to elect a successor Director,

B. the Grantee's death,

C. the involuntary termination of the Grantee's status as a Director of the
Corporation or the subsidiary, or

D. a Change of Control of the Corporation;

PROVIDED, HOWEVER, that under no circumstances shall the Shares be transferable
and free of restriction before the expiration of a six (6) month period
beginning on the first day of the Term of Office or, if later, their date of
issuance.

SECTION 12. CERTIFICATE LEGEND. Each certificate representing restricted
Shares granted pursuant to Section 10 to this Plan shall bear the following
legend:

"The sale or other transfer of the shares represented by this
certificate, whether voluntary, involuntary, or by operation of
law, is subject to certain restrictions on transfer set forth in
the Trans Financial Bancorp, Inc. Outside Directors' Restricted
Stock Plan and rules of administration adopted pursuant to such
Plan. A copy of the Directors' Restricted Stock Plan and the rules
of such Plan may be obtained from the Secretary of Trans Financial
Bancorp, Inc."

Once the restricted Shares are released from the restrictions set forth in
Section 11 hereof, the Grantee shall be entitled to have the legend required by
this Section 12 removed from such Share certificate(s).

SECTION 13. VOTING RIGHTS. During the Period of Restriction, Grantees
holding restricted Shares granted hereunder may exercise full voting rights with
respect to those Shares.

SECTION 14. DIVIDENDS AND OTHER DISTRIBUTIONS. During the Period of
Restriction, Grantees holding restricted Shares granted under Section 10 shall
be entitled to received all dividends and other distributions paid with respect
to those Shares while they are so held. If any such dividends or distribution
are paid in Shares, such Shares shall be subject to the same restrictions on
transferability as the restricted Shares with respect to which they were paid.

SECTION 15. LIFTING OF RESTRICTIONS AND FORFEITURE OF SHARES. The
restricted Share grants under Section 10 of the Plan shall be lifted
automatically upon the expiration of the Period of Restriction. If a Grantee
voluntarily terminates his status as a Director before the expiration of the
Period of Restriction of any grant, any Shares still held by the Grantee subject
to restriction shall be immediately forfeited.

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SECTION 16. PURCHASE FOR INVESTMENT. Upon the grant of restricted Shares
at a time when there is not in effect a registration statement under the
Securities Act of 1933 and any applicable state securities laws (the "Securities
Laws") relating to the shares of Common Stock issuable upon exercise thereof,
and available for delivery a prospectus meeting the requirements of the
Securities Laws, the shares of Common Stock may be issued only if the Eligible
Director represents and warrants in writing to the Corporation that the shares
being purchased are being acquired for investment and not with a view to the
distribution thereof. The shares of the Common Stock shall contain such legends
or other restrictive endorsements as counsel for the Corporation shall deem
necessary or proper.

SECTION 16. AMENDMENT AND TERMINATION. The Board may amend, modify, alter,
or terminate the Plan; PROVIDED, HOWEVER, that without approval by shareholders
of the Company holding not less than a majority of the votes represented and
entitled to be voted at a duly held meeting of the Company's shareholders, no
amendment shall be made if shareholder approval is necessary to continue to
qualify the Plan under the Securities and Exchange Commission Rule 16b-3;
PROVIDED, FURTHER, that the Plan may not be amended, modified, or altered more
than once in any six (6) month period.

SECTION 17. GOVERNING LAW. The Plan, and all grants and other documents
delivered hereunder, shall be construed in accordance with the governed by the
laws of Kentucky.

SECTION 18. EXPENSES OF PLAN. The expenses of administering the Plan shall
be borne by the Corporation.

SECTION 19. SUCCESSORS. The Plan shall be binding upon the successors and
assigns of the Participating Employers.

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TRANS FINANCIAL BANCORP, INC.
BOWLING GREEN, KENTUCKY
ANNUAL MEETING OF SHAREHOLDERS
APRIL 24, 1995
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

The undersigned shareholder in Trans Financial Bancorp, Inc., Bowling Green,
Kentucky ("Corporation") hereby constitutes and appoints Gregg Hall and Roger
Lundin, or either of them, his true and lawful attorneys and proxies, with full
power of substitution in and for each of them, to vote all shares of the
Corporation which the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held at The Phoenix Theatre, 549 East Main Street, Bowling
Green, Kentucky, on Monday, April 24, 1995, 3:00 p.m. local time, or at any
adjournment or adjournments thereof, on any and all of the proposals contained
in the Notice of the Annual Meeting of Shareholders, with all the powers the
undersigned would possess if present personally at said meeting, or at any
adjournment or adjournments thereof.

The Directors recommend a vote FOR Proposals 1, 2, 3 and 4.

<TABLE>
<S> <C> <C>
1. ELECTION OF DIRECTORS
FOR all nominees listed below / / WITHHOLD AUTHORITY / /
(except as marked to the contrary, to vote for all nominees listed
see Instruction below) below
Mary D. Cohron, Floyd H. Ellis, David B. Garvin, Douglas M. Lester, James
D. Scott and Thomas R. Wallingford (to be elected as Class I directors as
set forth in the proxy statement).
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below:)
--------------------------------------------------------------------------
2. PROPOSAL TO APPROVE THE TRANS FINANCIAL BANCORP, INC. EXECUTIVE STOCK
OPTION PLAN.
/ / FOR / / AGAINST / / ABSTAIN
3. PROPOSAL TO APPROVE THE TRANS FINANCIAL BANCORP, INC. OUTSIDE DIRECTORS'
RESTRICTED STOCK PLAN.
/ / FOR / / AGAINST / / ABSTAIN
4. PROPOSAL TO APPROVE AN AMENDMENT TO ARTICLE I OF THE ARTICLES OF
INCORPORATION TO CHANGE THE NAME OF THE CORPORATION TO "TRANS FINANCIAL,
INC."
/ / FOR / / AGAINST / / ABSTAIN
</TABLE>

The above-named proxies are granted the authority, in their discretion, to
act upon such other matters as may properly come before the meeting or any
adjournment or adjournments thereof.

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED
FOR THE NOMINEES LISTED ABOVE WITH THE DISCRETIONARY AUTHORITY DESCRIBED IN THE
ACCOMPANYING PROXY STATEMENT.
<PAGE>
This Proxy may be revoked at any time prior to the time the presence of a
quorum has been determined and declared, by a written notice of revocation
executed by the undersigned and delivered to the Secretary of the Corporation.

Dated _________________________ , 1995
______________________________________
______________________________________

PLEASE SIGN EXACTLY AS YOUR NAME
APPEARS AND RETURN THIS PROXY
IMMEDIATELY IN THE ENCLOSED STAMPED
SELF-ADDRESSED ENVELOPE.