FIFTH AMENDMENT TO
                     TRANSACTIONAL LINE OF CREDIT AGREEMENT



         This FIFTH AMENDMENT TO TRANSACTIONAL  LINE OF CREDIT AGREEMENT is made
and entered  into this 31st day of July,  1996 by and between THE MORGAN  GROUP,
INC.,  a Delaware  corporation  ("Company")  and KEYBANK  NATIONAL  ASSOCIATION,
formerly known as Society National Bank, Indiana, ("Bank").

                                    RECITALS

         A. On or about  September  13,  1994,  Company and Bank  entered into a
Transac- tional Line of Credit Agreement ("Agreement").

         B.       On or about September 26, 1994, the Agreement was amended.

         C. On or about May 12, 1995,  the maturity  date was extended by a Note
Modifi- cation Agreement.

         D. On or about July 28,  1995,  and again on May 8, 1996 the  Agreement
was amended.

         E.  The  parties  wish to again  amend  the  Agreement  to  extend  the
Termination Date.

         NOW, THEREFORE, in consideration of the covenants and agreements herein
contained and other  valuable  consideration,  the parties hereto agree that the
Recitals above set forth are part of this amendment for all purposes and further
agree as follows:

         1. The definition of "Termination  Date" contained in Section 1.2 shall
be deleted in its entirety and replaced with the following:

                  Termination  Date shall mean  April 30,  1997 or such  earlier
                  date that an  acceleration  has  occurred  pursuant to Article
                  VIII of this Agreement.

          2. All other terms,  provisions  and  conditions of the  Transactional
Line of Credit  Agreement (as previously  amended) are hereby ratified and shall
continue in full force and effect.







         IN WITNESS  WHEREOF,  the Company has hereunto set its hand by its duly
authorized  officers on the day and year first above  mentioned and effective as
of August 1, 1996.

                                      COMPANY:
                                      Morgan Group, Inc.


                                By: /s/ Richard B. DeBoer
                                    ------------------------------------------
                                    (Signature)

                                    Richard B. DeBoer, Chief Financial Officer
                                    ------------------------------------------
                                      (Typed or Printed Name and Office)



                                      BANK:
                                      KeyBank National Association


                                By: /s/ R. David Londergan, Jr.
                                    ------------------------------------------
                                    (Signature)

                                      R. David Londergan, Jr., V.P.
                                      ------------------------------------------
                                      (Typed or Printed Name and Office)







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