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EXHIBIT 2.1

AGREEMENT AND PLAN OF MERGER

BY AND BETWEEN

AREA BANCSHARES CORPORATION

AND

CARDINAL BANCSHARES, INC.

EXECUTION COPY

DATED AS OF MAY 1, 1997

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TABLE OF CONTENTS

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Preamble. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE 1 TRANSACTIONS AND TERMS OF MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Time and Place of Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Effective Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

ARTICLE 2 TERMS OF MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.1 Articles of Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

ARTICLE 3 MANNER OF CONVERTING SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.1 Conversion of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.2 Anti-Dilution Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3.3 Shares Held by Cardinal or Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
3.4 Conversion of Stock Options; Restricted Stock . . . . . . . . . . . . . . . . . . . . . . . . 3
3.5 Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.6 Dissenting Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

ARTICLE 4 EXCHANGE OF SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.1 Exchange Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.2 Rights of Former Cardinal Shareholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF CARDINAL . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.1 Organization, Standing, and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.2 Authority; No Breach By Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.3 Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
5.4 Cardinal Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
5.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.6 Absence of Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.7 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.8 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
5.9 Allowance for Possible Loan Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
5.10 Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
5.11 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
5.12 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.13 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.14 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.15 Material Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.16 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

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5.17 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.18 Statements True and Correct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.19 Accounting, Tax and Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.20 Charter Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.21 Derivatives Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.22 Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF AREA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.1 Organization, Standing, and Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.2 Authority; No Breach By Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.3 Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.4 Area Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.5 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.6 Absence of Undisclosed Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.7 Absence of Certain Changes or Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.8 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.9 Allowance for Possible Loan Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.10 Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.11 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.12 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.13 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.14 Employee Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.15 Material Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
6.16 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.17 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.18 Statements True and Correct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.19 Accounting, Tax and Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
6.20 Charter Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
6.21 Derivatives Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
6.22 Fairness Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
6.23 Cardinal Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

ARTICLE 7 CONDUCT OF BUSINESS PENDING CONSUMMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7.1 Affirmative Covenants of Cardinal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7.2 Negative Covenants of Cardinal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
7.3 Affirmative Covenants of Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
7.4 Negative Covenants of Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
7.5 Adverse Changes in Condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
7.6 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

ARTICLE 8 ADDITIONAL AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.1 Registration Statement; Proxy Statement; Shareholder Approval . . . . . . . . . . . . . . . . 30
8.2 Exchange Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.3 Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

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8.4 Filings with State Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.5 Agreement as to Efforts to Consummate . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
8.6 Investigation and Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.7 Press Releases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.8 Acquisition Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
8.9 Accounting and Tax Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
8.10 Agreement of Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
8.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
8.12 Certain Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
8.13 Employee Benefits and Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
8.14 Delivery to Exchange Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE 9 CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE . . . . . . . . . . . . . . . . . . . . . . 35
9.1 Conditions to Obligations of Each Party . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
9.2 Conditions to Obligations of Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
9.3 Conditions to Obligations of Cardinal . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

ARTICLE 10 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
10.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
10.2 Effect of Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
10.3 Non-Survival of Representations and Covenants . . . . . . . . . . . . . . . . . . . . . . . . 40

ARTICLE 11 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.2 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.3 Brokers and Finders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.4 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.5 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
11.6 Waivers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
11.7 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
11.8 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
11.9 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
11.10 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
11.11 Captions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
11.12 Enforcement of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
11.13 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

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LIST OF EXHIBITS

EXHIBIT NUMBER DESCRIPTION
- -------------- -----------
1. Form of Agreement of Affiliates of Cardinal. (Section 8.10).

2. Form of Agreement of Affiliates of Area (Section 8.10).

3. Form of Claims/Indemnification Letter (Section 9.2(d)).

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AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of May 1, 1997 by and between AREA BANCSHARES CORPORATION ("Area"), a
corporation organized and existing under the laws of the State of Kentucky,
with its principal office located in Owensboro, Kentucky, and CARDINAL
BANCSHARES, INC. ("Cardinal"), a corporation organized and existing under the
laws of the State of Kentucky, with its principal office located in Lexington,
Kentucky.

PREAMBLE

The Boards of Directors of Cardinal and Area are of the opinion that the
transactions described herein are in the best interests of the parties and
their respective shareholders. This Agreement provides for the merger of
Cardinal with a wholly-owned subsidiary of Area, with Cardinal being the
surviving corporation of the merger. As a result, shareholders of Cardinal
will become shareholders of Area, and each of the subsidiaries of Cardinal will
continue to conduct its business and operations as a wholly-owned subsidiary of
the surviving corporation. The transactions described in this Agreement are
subject to the approvals of the shareholders of both Area and Cardinal, the
Board of Governors of the Federal Reserve System, the Kentucky Department of
Financial Institutions and the satisfaction of certain other conditions
described in this Agreement. It is the intention of the parties to this
Agreement that the merger (i) for federal income tax purposes shall qualify as
a "reorganization" within the meaning of Section 368(a) of the Internal Revenue
Code and (ii) for accounting purposes shall be accounted for as a "pooling of
interests."

Certain terms used in this Agreement are defined in Section 11.1 of this
Agreement.

NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants and agreements set forth herein, the parties agree
as follows:

ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER

1.1 MERGER. Subject to the terms and conditions of this
Agreement, at the Effective Time, Area shall cause a wholly-owned subsidiary of
Area ("Interim"), which will be incorporated under the laws of the State of
Kentucky, to be merged with and into Cardinal in accordance with the provisions
of Section 271B.11-010 of the KBCA and with the effect provided in Section
271B.11-060 of the KBCA (the "Merger"). Cardinal shall be the Surviving
Corporation resulting from the Merger. The Merger shall be consummated pursuant
to the terms of this Agreement, which has been approved and adopted by the
respective Boards of Directors of Cardinal and Area.

1.2 TIME AND PLACE OF CLOSING. The Closing will take place at
10:00 a.m. on the date that the Effective Time occurs (or the immediately
preceding day if the Effective Time is earlier than

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10:00 a.m.), or at such other time as the Parties, acting through their chief
executive officers may mutually agree. The place of Closing shall be at the
principal offices of Area, Owensboro, Kentucky, or such other place as may be
mutually agreed upon by the Parties.

1.3 EFFECTIVE TIME. The Merger and other transactions
contemplated by this Agreement shall become effective on the date and at the
time the Articles of Merger reflecting the Merger shall become effective with
the Secretary of State of the State of Kentucky (the "Effective Time"). Subject
to the terms and conditions hereof, unless otherwise mutually agreed upon in
writing by the chief executive officer of each Party, the Effective Time shall
occur on the fifth business day following the last to occur of (a) the
effective date (including expiration of any applicable waiting period) of the
last required Consent of any Regulatory Authority having authority over and
approving or exempting the Merger, (b) the date on which the shareholders of
Area approve this Agreement to the extent such approval is required by
applicable Law, (c) the date on which the shareholders of Cardinal approve this
Agreement to the extent such approval is required by applicable Law; or such
other date as may be mutually agreed upon in writing by the chief executive
officer of each Party.

ARTICLE 2
TERMS OF MERGER

2.1 ARTICLES OF INCORPORATION. The Articles of Incorporation of
Cardinal in effect immediately prior to the Effective Time shall be the
Articles of Incorporation of the Surviving Corporation until otherwise amended
or repealed.

2.2 BYLAWS. The Bylaws of Cardinal in effect immediately prior
to the Effective Time shall be the Bylaws of the Surviving Corporation until
otherwise amended or repealed.

2.3 DIRECTORS AND OFFICERS. The directors of the Surviving
Corporation upon the Effective Time shall consist of the directors of Cardinal
immediately prior to the Effective Time, all of whom shall serve in accordance
with the Bylaws of the Surviving Corporation. The officers of the Surviving
Corporation, together with such additional persons as may thereafter be
elected, shall serve as the officers of the Surviving Corporation from and
after the Effective Time in accordance with the Bylaws of the Surviving
Corporation.

2.4 NAME. At the Effective Time of the Merger, the Surviving
Corporation will continue to operate under the name "Cardinal Bancshares, Inc."

ARTICLE 3
MANNER OF CONVERTING SHARES

3.1 CONVERSION OF SHARES. Subject to the provisions of this
Article 3, at the Effective Time, by virtue of the Merger and without any
action on the part of the holders thereof the shares of the constituent
corporations shall be converted as follows:

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(a) Each share of Interim capital stock issued and
outstanding immediately prior to the Effective Time shall remain issued and
outstanding from and after the Effective Time.

(b) At the Effective Time, each share of Cardinal Common
Stock (other than Dissenting Shares (defined at Section 3.6 below) or shares
canceled pursuant to Section 3.3 below) shall be converted into 2.7391 shares
(subject to Section 3.5 hereof) of Area Common Stock (the "Exchange Ratio"),
subject to adjustment as hereinafter provided.

3.2 ANTI-DILUTION PROVISIONS. In the event Cardinal or Area
changes the number of shares of Cardinal Common Stock or Area Common Stock,
respectively, issued and outstanding prior to the Effective Time as a result of
a stock split, stock dividend or similar recapitalization with respect to such
stock and the record date therefor (in the case of a stock dividend) or the
effective date therefor (in the case of a stock split or similar
recapitalization) shall be prior to the Effective Time, the Exchange Ratio
shall be proportionately adjusted.

3.3 SHARES HELD BY CARDINAL OR AREA. Each of the shares of
Cardinal Common Stock held by any Cardinal Company or by any Area Company, in
each case other than in a fiduciary capacity or as a result of debts previously
contracted, shall be canceled and retired at the Effective Time and no
consideration shall be issued in exchange therefor.

3.4 CONVERSION OF STOCK OPTIONS; RESTRICTED STOCK.

(a) At the Effective Time, all rights with respect to
Cardinal Common Stock pursuant to stock options ("Cardinal Options") granted by
Cardinal under the Cardinal Stock Plans, which are outstanding at the Effective
Time, whether or not exercisable, shall be converted into and become rights
with respect to Area Common Stock, and Area shall assume each Cardinal Option,
in accordance with the terms of the Cardinal Stock Plan and stock option
agreement by which it is evidenced. From and after the Effective Time, (i)
each Cardinal Option assumed by Area may be exercised solely for shares of Area
Common Stock, (ii) the number of shares of Area Common Stock subject to such
Cardinal Option shall be equal to the number of shares of Cardinal Common Stock
subject to such Cardinal Option immediately prior to the Effective Time
multiplied by the Exchange Ratio, and (iii) the per share exercise price under
each such Cardinal Option shall be adjusted by dividing the per share exercise
price under each such Cardinal Option by the Exchange Ratio and rounding down
to the nearest cent. Notwithstanding the provisions of clause (ii) of the
preceding sentence, Area shall not be obligated to issue any fraction of a
share of Area Common Stock upon exercise of a Cardinal Option, and any fraction
of a share of Area Common Stock that would otherwise be subject to a converted
Cardinal Option shall represent the right to receive a cash payment equal to
the product of such fraction and the difference between the "Market Value" of
one share of Area Common Stock and the per share exercise price of such Option.
The "Market Value" of one share of Area Common Stock shall be the last sales
price of such common stock on Nasdaq, or such other exchange or market system
on which Area Common Stock is then traded, (as reported by The Wall Street
Journal or, if not reported thereby, any other authoritative source selected by
Area) on the last trading day preceding the date of exercise. It is intended
that the foregoing assumption shall be undertaken in a manner that will not
constitute a "modification" as defined in Section 424 of the Internal Revenue
Code, as to any stock option which is an "incentive stock

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option." Cardinal and Area agree to take all necessary steps to effect the
provisions of this Section 3.4.

(b) All restrictions or limitations on transfer with
respect to Cardinal Common Stock awarded under the Cardinal Stock Plans or any
other plan, program or arrangement of any Cardinal Company, to the extent that
such restrictions or limitations shall not have already lapsed, and except as
otherwise expressly provided in such plan, program or arrangement, shall remain
in full force and effect with respect to shares of Area Common Stock into which
such restricted stock is converted pursuant to Section 3.1 of this Agreement.

3.5 FRACTIONAL SHARES. Notwithstanding any other provision of
this Agreement, each holder of shares of Cardinal Common Stock exchanged
pursuant to the Merger who would otherwise have been entitled to receive a
fraction of a share of Area Common Stock (after taking into account all
certificates delivered by such holder) shall receive in lieu thereof cash
(without interest) in an amount equal to such fractional part of a share of
Area Common Stock multiplied by the Market Value of one share of Area Common
Stock. No such holder will be entitled to dividends, voting rights, or any
other rights as a shareholder in respect of any fractional shares.

3.6 DISSENTING SHAREHOLDERS. Any holder of shares of Cardinal
Common Stock ("Dissenting Shares") or Area Common Stock who perfects such
holder's dissenters' rights of appraisal in accordance with and as contemplated
by Subtitle 271B.13 of the KBCA shall be entitled to receive the value of such
shares in cash as determined pursuant to such provision of Law; provided, that
no such payment shall be made to any dissenting shareholder unless and until
such dissenting shareholder has complied with the applicable provisions of the
KBCA and surrendered to Cardinal or Area, as the case may be, the certificate
or certificates representing the shares for which payment is being made. In
the event that after the Effective Time a dissenting shareholder of Cardinal or
Area, as the case may be, fails to perfect, or effectively withdraws or loses,
such holder's right to appraisal and of payment for such holder's shares, Area
shall issue and deliver the consideration to which such holder of shares of
Cardinal Common Stock or Area Common Stock, as the case may be, is entitled
under this Article 3 (without interest) upon surrender by such holder of the
certificate or certificates representing shares of Cardinal Common Stock or
Area Common Stock, as the case may be, held by such holder.

ARTICLE 4
EXCHANGE OF SHARES

4.1 EXCHANGE PROCEDURES. Unless the parties otherwise agree,
within three business days after the Effective Time, Area shall cause a
qualified exchange agent (the "Exchange Agent") to mail to the former holders
of Cardinal Common Stock appropriate transmittal materials which shall specify
that delivery shall be effected, and risk of loss and title to the certificates
theretofore representing shares of Cardinal Common Stock shall pass, only upon
proper delivery of such certificates to the Exchange Agent. After the
Effective Time, each holder of shares of Cardinal Common Stock (other than
shares to be canceled pursuant to Section 3.3 of this Agreement or as to which
dissenters' rights have been perfected as provided in Section 3.6 of this
Agreement) issued

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and outstanding at the Effective Time shall surrender the certificate or
certificates representing such shares to the Exchange Agent and shall promptly
upon surrender thereof receive in exchange therefor the consideration provided
in Section 3.1 of this Agreement, together with all undelivered dividends or
distributions in respect of such shares (without interest thereon) pursuant to
Section 4.2 of this Agreement. To the extent required by Section 3.5 of this
Agreement, each holder of shares of Cardinal Common Stock issued and
outstanding at the Effective Time also shall receive, upon surrender of the
certificate or certificates representing such shares, cash in lieu of any
fractional share of Area Common Stock to which such holder may otherwise be
entitled (without interest). The Exchange Agent shall not be obligated to
deliver the consideration to which any former holder of Cardinal Common Stock
is entitled as a result of the Merger until such holder surrenders his or her
certificate or certificates representing the shares of Cardinal Common Stock
for exchange as provided in this Section 4.1. The certificate or certificates
of Cardinal Common Stock so surrendered shall be duly endorsed as the Exchange
Agent may require. Any other provision of this Agreement notwithstanding, Area
shall not be liable to a holder of Cardinal Common Stock for any amounts paid
or property delivered in good faith to a public official pursuant to any
applicable abandoned property Law. The term of the Exchange Agent shall be not
less than 9 months.

4.2 RIGHTS OF FORMER CARDINAL SHAREHOLDERS. At the Effective
Time, the stock transfer books of Cardinal shall be closed as to holders of
Cardinal Common Stock immediately prior to the Effective Time and no transfer
of Cardinal Common Stock by any such holder shall thereafter be made or
recognized. Until surrendered for exchange in accordance with the provisions of
Section 4.1 of this Agreement, each certificate theretofore representing shares
of Cardinal Common Stock (other than shares to be canceled pursuant to Section
3.3 or as to which dissenters' rights have been perfected as provided in
Section 3.6 of this Agreement) shall from and after the Effective Time
represent for all purposes only the right to receive the consideration provided
in Sections 3.1 and 3.5 of this Agreement in exchange therefor. To the extent
permitted by Law, former holders of record of Cardinal Common Stock shall be
entitled to vote after the Effective Time at any meeting of Area shareholders
the number of whole shares of Area Common Stock into which their respective
shares of Cardinal Common Stock are converted, regardless of whether such
holders have exchanged their certificates representing Cardinal Common Stock
for certificates representing Area Common Stock in accordance with the
provisions of this Agreement. Whenever a dividend or other distribution is
declared by Area on Area Common Stock, the record date for which is at or after
the Effective Time, the declaration shall include dividends or other
distributions on all shares issuable pursuant to this Agreement, but no
dividend or other distribution payable to the holders of record of Area Common
Stock as of any time subsequent to the Effective Time shall be delivered to the
holder of any certificate representing shares of Cardinal Common Stock issued
and outstanding at the Effective Time until such holder surrenders such
certificate for exchange as provided in Section 4.1 of this Agreement.
However, upon surrender of such Cardinal Common Stock certificate, both Area
Common Stock certificate (together with all such undelivered dividends or other
distributions without interest) shall be delivered and paid with respect to
each share represented by such certificate.

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ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF CARDINAL

Cardinal hereby represents and warrants to Area as follows:

5.1 ORGANIZATION, STANDING, AND POWER. Cardinal is a corporation
duly organized, validly existing, and in good standing under the Laws of the
State of Kentucky and is duly registered as a bank holding company under the
BHC Act. Cardinal has the corporate power and authority to carry on its
business as now conducted and to own, lease and operate its Assets. Cardinal
is duly qualified or licensed to transact business as a foreign corporation in
good standing in the states of the United States and foreign jurisdictions
where the character of its Assets or the nature or conduct of its business
requires it to be so qualified or licensed, except for such jurisdictions in
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Cardinal.

5.2 AUTHORITY; NO BREACH BY AGREEMENT.

(a) Cardinal has the corporate power and authority
necessary to execute, deliver and perform its obligations under this Agreement
and to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated herein, including the Merger, have been duly and
validly authorized by all necessary corporate action in respect thereof on the
part of Cardinal, subject to the approval of this Agreement and the
transactions contemplated hereby by the holders of a majority of the
outstanding shares of Cardinal Common Stock, which is the only shareholder vote
required for approval of this Agreement and consummation of the Merger by
Cardinal. Subject to such requisite shareholder approval and any approvals
required of Regulatory Authorities, this Agreement represents a legal, valid
and binding obligation of Cardinal, enforceable against Cardinal in accordance
with its terms (except in all cases as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, or similar Laws
affecting the enforcement of creditors' rights generally and except that the
availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding
may be brought).

(b) Neither the execution and delivery of this Agreement
by Cardinal, nor the consummation by Cardinal of the transactions contemplated
hereby, nor compliance by Cardinal with any of the provisions hereof will (i)
conflict with or result in a breach of any provision of Cardinal's Articles of
Incorporation or Bylaws, or (ii) constitute or result in a Default under, or
require any Consent pursuant to, or result in the creation of any Lien on any
Asset of any Cardinal Company under, any Contract or Permit of any Cardinal
Company, where such Default or Lien, or any failure to obtain such Consent, is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Cardinal, or (iii) subject to receipt of the requisite approvals
referred to in Section 9.1 (b) of this Agreement, violate any Law or Order
applicable to any Cardinal Company or any of their respective Assets.

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(c) Other than in connection or compliance with the
provisions of the Securities Laws, applicable state corporate and securities
Laws, and rules of the NASD, and other than Consents required from Regulatory
Authorities, and other than notices to or filings with the Internal Revenue
Service or the Pension Benefit Guaranty Corporation with respect to any
employee benefit plans, and other than Consents, filings or notifications
which, if not obtained or made, are not reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect on Cardinal, no notice to,
filing with, or Consent of any public body or authority is necessary for the
consummation by Cardinal of the Merger and the other transactions contemplated
in this Agreement.

5.3 CAPITAL STOCK.

(a) The authorized capital stock of Cardinal consists of
5,000,000 shares of Cardinal Common Stock, of which 1,593,757 shares are issued
and outstanding as of the date of this Agreement. All of the issued and
outstanding shares of capital stock of Cardinal are duly and validly issued and
outstanding and are fully paid and nonassessable under the KBCA. None of the
outstanding shares of capital stock of Cardinal has been issued in violation of
any preemptive rights of the current or past shareholders of Cardinal.
Cardinal has reserved 220,619 shares of Cardinal Common Stock for issuance
under the Cardinal Stock Plans, pursuant to which options to purchase not more
than 211,698 shares of Cardinal Common Stock are outstanding as of the date of
this Agreement and at the Effective Time.

(b) Except as set forth in Section 5.3(a) of this
Agreement, or as disclosed in Section 5.3 of the Cardinal Disclosure
Memorandum, there are no shares of capital stock or other equity securities of
Cardinal outstanding and no outstanding Rights relating to the capital stock of
Cardinal.

5.4 CARDINAL SUBSIDIARIES. Cardinal has disclosed in Section 5.4
of the Cardinal Disclosure Memorandum all of the Cardinal Subsidiaries as of
the date of this Agreement. Except as disclosed in Section 5.4 of the Cardinal
Disclosure Memorandum, Cardinal or one of its Subsidiaries owns all of the
issued and outstanding shares of capital stock of each Cardinal Subsidiary. No
equity securities of any Cardinal Subsidiary are or may become required to be
issued (other than to another Cardinal Company) by reason of any Rights, and
there are no Contracts by which any Cardinal Subsidiary is bound to issue
(other than to another Cardinal Company) additional shares of its capital stock
or Rights, or by which any Cardinal Company is or may be bound to transfer any
shares of the capital stock of any Cardinal Subsidiary (other than to another
Cardinal Company), and there are no Contracts by which any Cardinal Company is
bound to issue (other than to another Cardinal Company) additional shares of
its capital stock. There are no Contracts relating to the rights of any
Cardinal Company to vote or to dispose of any shares of the capital stock of
any Cardinal Subsidiary. All of the shares of capital stock of each Cardinal
Subsidiary held by a Cardinal Company are fully paid and nonassessable under
the applicable Law of the jurisdiction in which such Subsidiary is incorporated
or organized and are owned by the Cardinal Company free and clear of any Lien.
Each Cardinal Subsidiary is either a bank, a trust company, a savings
association or a corporation and is duly organized, validly existing, and (as
to corporations) in good standing under the Laws of the jurisdiction in which
it is organized and has the corporate power and authority necessary for it to
own, lease and operate its Assets and to carry on its business as now

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conducted. Each Cardinal Subsidiary is duly qualified or licensed to transact
business as a foreign corporation in good standing in the States of the United
States and foreign jurisdictions where the character of its Assets or the
nature or conduct of its business requires it to be so qualified or licensed,
except for such jurisdictions in which the failure to be so qualified or
licensed is not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Cardinal. Each Cardinal Subsidiary that is a
depository institution is an "insured institution" as defined in the Federal
Deposit Insurance Act and applicable regulations thereunder, and the deposits
in which are insured to applicable limits by the Bank Insurance Fund or the
Savings Association Insurance Fund, as appropriate.

5.5 FINANCIAL STATEMENTS. Cardinal has included in Section 5.5
of the Cardinal Disclosure Memorandum copies of all Cardinal Financial
Statements for the periods ended on or before December 31, 1996 and will
deliver to Area copies of all Cardinal Financial Statements prepared subsequent
to the date hereof. The Cardinal Financial Statements (as of the dates thereof
and for the periods covered thereby) (a) are, or if dated after the date of
this Agreement will be, in accordance with the books and records of the
Cardinal Companies, which are or will be, as the case may be, complete and
correct and which have been or will have been, as the case may be, maintained
in accordance with good business practices, and (b) present or will present, as
the case may be, fairly the consolidated financial position of the Cardinal
Companies as of the dates indicated and the consolidated results of operations,
changes in shareholders' equity, and cash flows of the Cardinal Companies for
the periods indicated, in accordance with GAAP (subject to any exceptions as to
consistency specified therein or as may be indicated in the notes thereto or,
in the case of interim financial statements, to normal recurring year-end
adjustments that are not material in amount or effect).

5.6 ABSENCE OF UNDISCLOSED LIABILITIES. No Cardinal Company has
any Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Cardinal except Liabilities which are
reflected or otherwise accrued or reserved against in the consolidated balance
sheets of Cardinal as of December 31, 1996, included in the Cardinal Financial
Statements or reflected in the notes thereto. No Cardinal Company has incurred
or paid any Liability since December 31, 1996, except for such Liabilities
reflected or otherwise accrued or reserved against in the Cardinal Financial
Statements, or as may have been incurred or paid in the ordinary course of
business consistent with past business practice and which are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Cardinal.

5.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December 31,
1996, except as disclosed in SEC Documents filed by Cardinal prior to the date
of this Agreement or in Section 5.7 of the Cardinal Disclosure Memorandum, (a)
there have been no events, changes or occurrences which have had, or are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Cardinal, and (b) the Cardinal Companies have not taken any action,
or failed to take any action, prior to the date of this Agreement, which action
or failure, if taken after the date of this Agreement, would represent or
result in a material breach or violation of any of the covenants and agreements
of Cardinal provided in Article 7 of this Agreement.

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5.8 TAX MATTERS.

(a) All Tax returns required to be filed by or on behalf
of any of the Cardinal Companies have been timely filed or requests for
extensions have been timely filed, granted, and have not expired for periods
ended on or before December 31, 1996, except to the extent that all such
failures to file, taken together, are not reasonably likely to have a Material
Adverse Effect on Cardinal and all returns filed are complete and accurate in
all material respects to the Knowledge of Cardinal. All Taxes shown as due on
filed returns have been paid. There is no audit examination, deficiency or
refund Litigation with respect to any Taxes that is reasonably likely to result
in a determination that would have, individually or in the aggregate, a
Material Adverse Effect on Cardinal, except as reserved against in the Cardinal
Financial Statements delivered prior to the date of this Agreement or as
disclosed in Section 5.8(a) of the Cardinal Disclosure Memorandum. All
material Taxes and other Liabilities due with respect to completed and settled
examinations or concluded Litigation have been paid.

(b) Except as disclosed in Section 5.8(b) of the
Cardinal Disclosure Memorandum, none of the Cardinal Companies has executed an
extension or waiver of any statute of limitations on the assessment or
collection of any Tax due that is currently in effect, and no unpaid tax
deficiency has been asserted in writing against or with respect to any Cardinal
Company, which deficiency is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Cardinal.

(c) Adequate provision for any Taxes due or to become
due for any of the Cardinal Companies for the period or periods through and
including the date of the respective Cardinal Financial Statements has been
made and is reflected on such Cardinal Financial Statements.

(d) Deferred Taxes of the Cardinal Companies have been
provided for in accordance with GAAP.

(e) Each of the Cardinal Companies is in compliance in
all material respects with, and its records contain all information and
documents (including, without limitation, properly completed IRS Forms W-9)
necessary to comply in all material respects with, all applicable information
reporting and Tax withholding requirements under federal, state and local Tax
Laws, and such records identify with specificity all accounts subject to backup
withholding under Section 3406 of the Internal Revenue Code, except for such
instances of noncompliance and such omissions as are not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Cardinal.

5.9 ALLOWANCE FOR POSSIBLE LOAN LOSSES. The allowance for
possible loan or credit losses (the "Allowance") shown on the consolidated
balance sheets of Cardinal included in the most recent Cardinal Financial
Statements dated prior to the date of this Agreement was, and the Allowance
shown on the consolidated balance sheets of Cardinal included in the Cardinal
Financial Statements as of dates subsequent to the execution of this Agreement
will be, as of the dates thereof, adequate (within the meaning of GAAP and
applicable regulatory requirements or guidelines) to provide for losses
relating to or inherent in the loan and lease portfolios (including accrued
interest

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receivables) of the Cardinal Companies and other extensions of credit
(including letters of credit and commitments to make loans or extend credit) by
the Cardinal Companies as of the dates thereof except where the failure of such
Allowance to be so adequate is not reasonably likely to have a Material Adverse
Effect on Cardinal.

5.10 ASSETS. Except as disclosed in Section 5.10 of the Cardinal
Disclosure Memorandum or as disclosed or reserved against in the Cardinal
Financial Statements, the Cardinal Companies have good and marketable title,
free and clear of all Liens, to all of their respective Assets. All material
tangible properties used in the businesses of the Cardinal Companies are in
good condition, reasonable wear and tear excepted, and are usable in the
ordinary course of business consistent with Cardinal's past practices. All
Assets which are material to Cardinal's business on a consolidated basis, held
under leases or subleases by any of the Cardinal Companies, are held under
valid Contracts enforceable in accordance with their respective terms (except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceedings may be brought), and each
such Contract is in full force and effect. The policies of fire, theft,
liability and other insurance maintained with respect to the Assets or
businesses of the Cardinal Companies provide adequate coverage under current
industry practices against loss or Liability, and the fidelity and blanket
bonds in effect as to which any of the Cardinal Companies is a named insured
are reasonably sufficient. The Assets of the Cardinal Companies include all
assets required to operate the business of the Cardinal Companies as presently
conducted.

5.11 ENVIRONMENTAL MATTERS.

(a) Except as disclosed in Section 5.11(a) of the
Cardinal Disclosure Memorandum, to the Knowledge of Cardinal, each Cardinal
Company, its Participation Facilities and its Loan Properties are, and have
been, in compliance with all Environmental Laws, except for violations which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Cardinal.

(b) To the Knowledge of Cardinal, there is no Litigation
pending or threatened before any court, governmental agency or authority or
other forum in which any Cardinal Company or any of its Loan Properties or
Participation Facilities has been or, with respect to threatened Litigation,
may be named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material (as
defined below) or oil, whether or not occurring at, on, under or involving a
site owned, leased or operated by any Cardinal Company or any of its Loan
Properties or Participation Facilities, except for such Litigation pending or
threatened that is not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Cardinal and to the Knowledge of
Cardinal, there is no reasonable basis for any such Litigation.

(c) To the Knowledge of Cardinal, there have been no
releases of Hazardous Material or oil in, on, under or affecting any
Participation Facility or Loan Property, except such

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as are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Cardinal.

5.12 COMPLIANCE WITH LAWS. Each Cardinal Company has in effect
all Permits necessary for it to own, lease or operate its Assets and to carry
on its business as now conducted, except for those Permits the absence of which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Cardinal, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Cardinal.
Except as disclosed in Section 5.12 of the Cardinal Disclosure Memorandum, no
Cardinal Company:

(a) is in violation of any Laws, Orders or Permits
applicable to its business or employees conducting its business, except for
violations which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Cardinal; and

(b) has received any notification or communication from
any agency or department of federal, state, or local government or any
Regulatory Authority or the staff thereof (i) asserting that any Cardinal
Company is not in compliance with any of the Laws or Orders which such
governmental authority or Regulatory Authority enforces, where such
noncompliance is reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Cardinal, (ii) threatening to revoke any Permits,
the revocation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Cardinal, or (iii) requiring any
Cardinal Company to enter into or consent to the issuance of a cease and desist
order, formal agreement, directive, commitment or memorandum of understanding,
or to adopt any Board resolution or similar undertaking, which restricts
materially the conduct of its business, or in any manner relates to its capital
adequacy, its credit or reserve policies, its management, or the payment of
dividends.

5.13 LABOR RELATIONS. No Cardinal Company is the subject of any
Litigation asserting that it or any other Cardinal Company has committed an
unfair labor practice (within the meaning of the National Labor Relations Act
or comparable state law) or seeking to compel it or any other Cardinal Company
to bargain with any labor organization as to wages or conditions of employment,
nor is there any strike or other labor dispute involving any Cardinal Company,
pending or, to its Knowledge, threatened, nor, to its Knowledge, is there any
activity involving any Cardinal Company's employees seeking to certify a
collective bargaining unit or engaging in any other organization activity.

5.14 EMPLOYEE BENEFIT PLANS.

(a) Cardinal has disclosed in Section 5.14 of the
Cardinal Disclosure Memorandum and delivered or made available to Area prior to
the execution of this Agreement copies in each case of all pension, retirement,
profit-sharing, deferred compensation, stock option, employee stock ownership,
severance pay, vacation, bonus, or other incentive plans, all other written
employee programs, arrangements, or agreements, all medical, vision, dental, or
other health plans, all life insurance plans, and all other employee benefit
plans or fringe benefit plans, including,

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without limitation, "employee benefit plans" as that term is defined in Section
3(3) of ERISA, currently adopted, maintained by, sponsored in whole or in part
by, or contributed to by any Cardinal Company or ERISA Affiliate thereof for
the benefit of employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries and under which employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
are eligible to participate (collectively, the "Cardinal Benefit Plans"). Any
of the Cardinal Benefit Plans which is an "employee pension benefit plan," as
that term is defined in Section 3(2) of ERISA, is referred to herein as a
"Cardinal ERISA Plan."

(b) Except as to those plans disclosed in Section
5.14(b) of the Cardinal Disclosure Memorandum as tax-qualified Cardinal ERISA
Plans (the "Cardinal Qualified Plans"), no Cardinal Company maintains or
previously maintained during the six years preceding the date of this Agreement
a Cardinal Plan which meets or was intended to meet the requirements of Code
Section 401(a). The Internal Revenue Service has issued favorable
determination letters to the effect that each Cardinal Qualified Plan qualifies
under Code Section 401(a) and that any related trust is exempt from taxation
under Code Section 501(a), and such determination letters remain in effect and
have not been revoked. Copies of the most recent determination letters and any
outstanding requests for a determination letter with respect to each Cardinal
Qualified Plan have been delivered or made available to Area. Except as
disclosed in Section 5.14(b) of the Cardinal Disclosure Memorandum, no Cardinal
Qualified Plan has been amended since the issuance of each respective
determination letter. The Cardinal Qualified Plans currently comply in form
with the requirements under Code Section 401(a), other than changes required by
statutes, regulations and rulings for which amendments are not yet required.
No issue concerning qualification of the Cardinal Qualified Plans is pending
before or is threatened by the Internal Revenue Service. The Cardinal
Qualified Plans have been administered according to their terms (except for
those terms which are inconsistent with the changes required by statutes,
regulations, and rulings for which changes are not yet required to be made, in
which case the Cardinal Qualified Plans have been administered in accordance
with the provisions of those statutes, regulations and rulings) and in
accordance with the requirements of Code Section 401(a). No Cardinal Company,
any ERISA Affiliate or any fiduciary of any Cardinal Qualified Plan has done
anything that would adversely affect the qualified status of the Cardinal
Qualified Plans or the related trusts. Any Cardinal Qualified Plan which is
required to satisfy Code Section 401(k)(3) and 401(m)(2) has been tested for
compliance with, and has satisfied the requirements of, Code Section 401(k)(3)
and 401(m)(2) for each plan year ending prior to the date of this Agreement.

(c) All Cardinal Benefit Plans are in compliance in all
material respects with the applicable terms of ERISA, the Internal Revenue
Code, and any other applicable Laws the breach or violation of which are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Cardinal. To the Knowledge of Cardinal, no Cardinal Company nor any
other party has engaged in a transaction with respect to any Cardinal Benefit
Plan that, assuming the taxable period of such transaction expired as of the
date hereof, would subject any Cardinal Company to a tax or penalty imposed by
either Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA in
amounts which are reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on Cardinal.

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(d) Neither Cardinal nor any ERISA Affiliate of Cardinal
maintains or has during the six years preceding the date of this Agreement
maintained an "employee benefit pension plan," within the meaning of Section
3(2) of ERISA that is or was subject to Title IV of ERISA.

(e) Neither Cardinal nor any ERISA Affiliate of Cardinal
has any past, present or future obligation or liability to contribute to any
multi-employer plan, as defined in Section 3(37) of ERISA.

(f) Except as disclosed in Section 5.14(f) of the
Cardinal Disclosure Memorandum, (i) no Cardinal Company has any obligations for
retiree health and life benefits under any of the Cardinal Benefit Plans and
(ii) there are no restrictions on the rights of such Cardinal Company to amend
or terminate any such Plan without incurring any Liability thereunder, which
Liability is reasonably likely to have a Material Adverse Effect on Cardinal,
other than for benefits accrued before the date of such termination or
amendment.

(g) Except as disclosed in Section 5.14(g) of the
Cardinal Disclosure Memorandum, neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will (i)
result in any payment (including, without limitation, severance, unemployment
compensation, golden parachute or otherwise) becoming due to any director or
any employee of any Cardinal Company from any Cardinal Company under any
Cardinal Benefit Plan or otherwise, (ii) increase any benefits otherwise
payable under any Cardinal Benefit Plan, or (iii) result in any acceleration of
the time of payment or vesting of any such benefit.

(h) The actuarial present values of all accrued deferred
compensation entitlements (including, without limitation, entitlements under
any executive compensation, supplemental retirement, or employment agreement)
of employees and former employees of any Cardinal Company and their respective
beneficiaries, other than entitlements accrued pursuant to funded retirement
plans subject to the provisions of Section 412 of the Internal Revenue Code or
Section 302 of ERISA, have been reflected on the Cardinal Financial Statements
to the extent required by and in accordance with GAAP.

(i) Cardinal and each ERISA Affiliate of Cardinal has
complied in all material respects with applicable continuation of coverage
requirements of Section 1001 of the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended, and ERISA Sections 601 through 608.

(j) Except as disclosed in Section 5.14(j) of the
Cardinal Disclosure Memorandum, neither Cardinal nor any ERISA Affiliate of
Cardinal is obligated, contingently or otherwise, under any agreement to pay
any amount which would be treated as a "parachute payment," as defined in
Section 280G(b) of the Internal Revenue Code (determined without regard to
Section 280G(b)(2)(A)(ii) of the Internal Revenue Code).

(k) Other than routine claims for benefits, there are no
actions, audits, investigations, suits or claims pending, or threatened against
any Cardinal Benefit Plan, any trust or other funding agency created
thereunder, or against any fiduciary of any Cardinal Benefit Plan or against
the assets of any Cardinal Benefit Plan.

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5.15 MATERIAL CONTRACTS. Except as disclosed in Section 5.15 of
the Cardinal Disclosure Memorandum or otherwise reflected in the Cardinal
Financial Statements, none of the Cardinal Companies, nor any of their
respective Assets, businesses or operations, is a party to, or is bound or
affected by, or receives benefits under, (a) any employment, severance,
termination, consulting or retirement Contract providing for aggregate payments
to any Person in any calendar year in excess of $25,000, excluding "at will"
employment arrangements, (b) any Contract relating to the borrowing of money by
any Cardinal Company or the guarantee by any Cardinal Company of any such
obligation (other than Contracts evidencing deposit liabilities, purchases of
federal funds, Federal Home Loan Bank advances, fully-secured repurchase
agreements, trade payables, and Contracts relating to borrowings or guarantees
made in the ordinary course of business), (c) any Contracts between or among
Cardinal Companies, and (d) any other Contract (excluding this Agreement) or
amendment thereto that would be required to be filed as an exhibit to a Form
10-K filed by Cardinal with the SEC as of the date of this Agreement that has
not been filed as an exhibit to Cardinal's Form 10-K filed for the fiscal year
ended December 31, 1996, or in an SEC Document and identified to Area (together
with all Contracts referred to in Sections 5.10 and 5.14(a) of this Agreement,
the "Cardinal Contracts"). None of the Cardinal Companies is in Default under
any Cardinal Contract, other than Defaults which are not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Cardinal.
Except as to FHLB advances, all of the indebtedness of any Cardinal Company for
money borrowed is prepayable at any time by such Cardinal Company without
penalty or premium.

5.16 LEGAL PROCEEDINGS. Except as disclosed in Section 5.16 of
the Cardinal Disclosure Memorandum, there is no Litigation instituted or
pending, or, to the Knowledge of Cardinal, threatened (or unasserted but
considered probable of assertion and which if asserted would have at least a
reasonable probability of an unfavorable outcome) against any Cardinal Company,
or against any Asset, interest, or right of any of them, that is reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Cardinal, nor are there any Orders of any Regulatory Authorities, other
governmental authorities, or arbitrators outstanding against any Cardinal
Company, that are reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on Cardinal.

5.17 REPORTS. Since January 1, 1994, each Cardinal Company has
timely filed all reports and statements, together with any amendments required
to be made with respect thereto, that it was required to file with (a) the SEC,
including, but not limited to, Forms 10-K, Forms 10-Q, Forms 8-K, and proxy
statements, (b) the Regulatory Authorities, and (c) any applicable state
securities or banking authorities (except, in the case of state securities
authorities, failures to file which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Cardinal). As
of their respective dates, each of such reports and documents, including the
financial statements, exhibits, and schedules thereto, complied in all material
respects with all applicable Laws. As of its respective date, each such report
and document to Cardinal's Knowledge did not, in any material respects, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they were made, not misleading.

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5.18 STATEMENTS TRUE AND CORRECT. No statement, certificate,
instrument or other writing furnished or to be furnished by any Cardinal
Company to Area pursuant to this Agreement contains or will contain any untrue
statement of material fact or will omit to state a material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading. None of the information supplied or to be supplied
by any Cardinal Company for inclusion in the Registration Statement to be filed
by Area with the SEC will, when the Registration Statement becomes effective,
be false or misleading with respect to any material fact, or omit to state any
material fact necessary to make the statements therein not misleading. None of
the information supplied or to be supplied by any Cardinal Company for
inclusion in the Proxy Statement to be mailed to Cardinal's shareholders in
connection with the Cardinal Shareholders' Meeting, and any other documents to
be filed by any Cardinal Company with the SEC or any other Regulatory Authority
in connection with the transactions contemplated hereby, will, at the
respective time such documents are filed, and with respect to the Proxy
Statement, when first mailed to the shareholders of Cardinal, be false or
misleading with respect to any material fact, or omit to state any material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, or, in the case of the Proxy
Statement or any amendment thereof or supplement thereto, at the time of the
Cardinal Shareholders' Meeting, be false or misleading with respect to any
material fact, or omit to state any material fact necessary to correct any
statement in any earlier communication with respect to the solicitation of any
proxy for the Cardinal Shareholders' Meeting. All documents that any Cardinal
Company is responsible for filing with any Regulatory Authority in connection
with the transactions contemplated hereby will comply as to form in all
material respects with the provisions of applicable Law.

5.19 ACCOUNTING, TAX AND REGULATORY MATTERS. No Cardinal Company
or, to the Knowledge of Cardinal, any Affiliate thereof has taken any action,
or agreed to take any action, or has any Knowledge of any fact or circumstance
that is reasonably likely to (a) prevent the transactions contemplated hereby,
including the Merger, from qualifying for pooling-of-interests accounting
treatment or treatment as a reorganization within the meaning of Section 368(a)
of the Internal Revenue Code, or (b) materially impede or delay receipt of any
Consents of Regulatory Authorities referred to in Section 9.1(b) of this
Agreement or result in the imposition of a condition or restriction of the type
referred to in the second sentence of such Section. To the Knowledge of
Cardinal, there exists no fact, circumstance, or reason attributable to
Cardinal why the requisite Consents referred to in Section 9.1(b) of this
Agreement cannot be received in a timely manner without the imposition of any
condition or restriction of the type described in the second sentence of such
Section 9.1(b).

5.20 CHARTER PROVISIONS. Each Cardinal Company has taken all
action so that the entering into of this Agreement and the consummation of the
Merger and the other transactions contemplated by this Agreement do not and
will not result in the grant of any rights to any Person under the Articles of
Incorporation, Bylaws or other governing instruments of any Cardinal Company or
restrict or impair the ability of Area to vote, or otherwise to exercise the
rights of a shareholder with respect to, shares of any Cardinal Company that
may be acquired or controlled by it.

5.21 DERIVATIVES CONTRACTS. Except as set forth in Section 5.21
of the Cardinal Disclosure Memorandum, neither Cardinal nor any of its
Subsidiaries is a party to or has agreed to enter into an exchange-traded or
over-the-counter swap, forward, future, option, cap, floor or collar financial

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contract, or any other interest rate or foreign currency protection contract
not included on its balance sheet which is a financial derivative contract
(including various combinations thereof).

5.22 FAIRNESS OPINION. Cardinal has received an opinion from
Professional Bank Services, Inc. ("PBS") to the effect that, in its opinion,
the consideration to be paid to the shareholders hereunder is fair to such
shareholders from a financial point of view (the "PBS Fairness Opinion"), and
PBS has consented to the inclusion of the PBS Fairness Opinion in the
Registration Statement.

ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF AREA

Area hereby represents and warrants to Cardinal as follows:

6.1 ORGANIZATION, STANDING, AND POWER. Area is a corporation
duly organized, validly existing, and in good standing under the Laws of the
State of Kentucky, and is duly registered as a bank holding company under the
BHC Act. Area has the corporate power and authority to carry on its business
as now conducted and to own, lease and operate its Assets. Area is duly
qualified or licensed to transact business as a foreign corporation in good
standing in the States of the United States and foreign jurisdictions where the
character of its Assets or the nature or conduct of its business requires it to
be so qualified or licensed, except for such jurisdictions in which the failure
to be so qualified or licensed is not reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect on Area.

6.2 AUTHORITY; NO BREACH BY AGREEMENT.

(a) Area has the corporate power and authority necessary
to execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
Area, subject to the approval of this Agreement and the transactions
contemplated hereby by the holders of a majority of the outstanding Area Common
Stock, which is the only shareholder vote required for approval of this
Agreement and consummation of the Merger by Area. Subject to such requisite
shareholder approval and any approvals required of Regulatory Authorities, this
Agreement represents a legal, valid and binding obligation of Area, enforceable
against Area in accordance with its terms (except in all cases as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding may be brought). Subject
to approval by the shareholders of Area of an increase in the authorized shares
of Area Common Stock referred to at Section 6.3(a) below, Area has reserved for
issuance up to 4,750,983 shares of Area Common Stock for consummation of the
Merger and for issuance pursuant to Cardinal Options.

(b) Neither the execution and delivery of this Agreement
by Area, nor the consummation by Area of the transactions contemplated hereby,
nor compliance by Area with any

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of the provisions hereof will (i) conflict with or result in a breach of any
provision of Area's Articles of Incorporation or Bylaws, or (ii) constitute or
result in a Default under, or require any Consent pursuant to, or result in the
creation of any Lien on any Asset of any Area Company under, any Contract or
Permit of any Area Company, where such Default or Lien, or any failure to
obtain such Consent, is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Area, or (iii) subject to receipt of
the requisite approvals referred to in Section 9.1(b) of this Agreement,
violate any Law or Order applicable to any Area Company or any of their
respective Assets.

(c) Other than in connection or compliance with the
provisions of the Securities Laws, applicable state corporate and securities
Laws, and rules of the NASD, and other than Consents required from Regulatory
Authorities, and other than notices to or filings with the Internal Revenue
Service or the Pension Benefit Guaranty Corporation with respect to any
employee benefit plans, and other than Consents, filings or notifications
which, if not obtained or made, are not reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect on Area, no notice to, filing
with, or Consent of any public body or authority is necessary for the
consummation by Area of the Merger and the other transactions contemplated in
this Agreement.

6.3 CAPITAL STOCK.

(a) The authorized capital stock of Area consists of (i)
16,000,000 shares of Area Common Stock, of which 11,303,048 shares were issued
and outstanding as of the date of this Agreement and (ii) 500,000 shares of
preferred stock, no par value, none of which is issued and outstanding as of
the date of this Agreement. All of the issued and outstanding shares of Area
Common Stock are, and all of the shares of Area Common Stock to be issued in
exchange for shares of Cardinal Common Stock upon consummation of the Merger,
when issued in accordance with the terms of this Agreement, will be, duly and
validly issued and outstanding and fully paid and nonassessable under the KBCA.
Subject to approval by a majority of the issued and outstanding shares of Area
Common Stock, the board of directors of Area has approved an amendment to
Area's Articles of Incorporation to increase the number of authorized shares of
Area Common Stock to 50,000,000. None of the outstanding shares of Area Common
Stock has been, and none of the shares of Area Common Stock to be issued in
exchange for shares of Cardinal Common Stock upon consummation of the Merger
will be, issued in violation of any preemptive rights of the current or past
shareholders of Area. Area has reserved 97,313 shares of Area Common Stock for
issuance under the Area Stock Plans, pursuant to which options to purchase not
more than 22,932 shares of Area Common Stock are outstanding as of the date of
this Agreement and at the Effective Time.

(b) Except as set forth in Section 6.3(a) of this
Agreement, or as disclosed in Section 6.3(b) of the Area Disclosure Memorandum,
there are no shares of capital stock or other equity securities of Area
outstanding and no outstanding Rights relating to the capital stock of Area.

6.4 AREA SUBSIDIARIES. Area has disclosed in Section 6.4 of the
Area Disclosure Memorandum all of the Area Subsidiaries as of the date of this
Agreement. Except as disclosed in Section 6.4 of the Area Disclosure
Memorandum, Area or one of its Subsidiaries owns all of the issued and
outstanding shares of capital stock of each Area Subsidiary. No equity
securities of any Area Subsidiary are or may become required to be issued
(other than to another Area Company) by reason of any Rights, and there are no
Contracts by which any Area Subsidiary is bound to issue

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(other than to another Area Company) additional shares of its capital stock or
Rights, or by which any Area Company is or may be bound to transfer any shares
of the capital stock of any Area Subsidiary (other than to another Area
Company), and there are no Contracts by which any Area Company is bound to
issue (other than to another Area Company) additional shares of its capital
stock. There are no Contracts relating to the rights of any Area Company to
vote or to dispose of any shares of the capital stock of any Area Subsidiary.
All of the shares of capital stock of each Area Subsidiary held by a Area
Company are fully paid and nonassessable under the applicable Law of the
jurisdiction in which such Subsidiary is incorporated or organized and are
owned by the Area Company free and clear of any Lien. Each Area Subsidiary is
either a bank, a trust company, a savings association or a corporation and is
duly organized, validly existing, and (as to corporations) in good standing
under the Laws of the jurisdiction in which it is organized and has the
corporate power and authority necessary for it to own, lease and operate its
Assets and to carry on its business as now conducted. Each Area Subsidiary is
duly qualified or licensed to transact business as a foreign corporation in
good standing in the States of the United States and foreign jurisdictions
where the character of its Assets or the nature or conduct of its business
requires it to be so qualified or licensed, except for such jurisdictions in
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on Area.
Each Area Subsidiary that is a depository institution is an "insured
institution" as defined in the Federal Deposit Insurance Act and applicable
regulations thereunder, and the deposits in which are insured to applicable
limits by the Bank Insurance Fund or the Savings Association Insurance Fund, as
appropriate.

6.5 FINANCIAL STATEMENTS. Area has included in Section 6.5 of
the Area Disclosure Memorandum copies of all Area Financial Statements for the
periods ended on or before December 31, 1996 and will deliver to Cardinal
copies of all Area Financial Statements prepared subsequent to the date hereof.
The Area Financial Statements (as of the dates thereof and for the periods
covered thereby) (a) are, or if dated after the date of this Agreement will be,
in accordance with the books and records of the Area Companies, which are or
will be, as the case may be, complete and correct and which have been or will
have been, as the case may be, maintained in accordance with good business
practices, and (b) present or will present, as the case may be, fairly the
consolidated financial position of the Area Companies as of the dates indicated
and the consolidated results of operations, changes in shareholders' equity,
and cash flows of the Area Companies for the periods indicated, in accordance
with GAAP (subject to any exceptions as to consistency specified therein or as
may be indicated in the notes thereto or, in the case of interim financial
statements, to normal recurring year-end adjustments that are not material in
amount or effect).

6.6 ABSENCE OF UNDISCLOSED LIABILITIES. No Area Company has any
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Area, except Liabilities which are
reflected or otherwise accrued or reserved against in the consolidated balance
sheets of Area as of December 31, 1996, included in the Area Financial
Statements or reflected in the notes thereto. No Area Company has incurred or
paid any Liability since December 31, 1996, except for such Liabilities
reflected or otherwise accrued or reserved against in the Area Financial
Statements, or as may have been incurred or paid in the ordinary course of
business consistent with past business practice and which are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Area.

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6.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December 31,
1996, except as disclosed in SEC Documents filed by Area prior to the date of
this Agreement or in Section 6.7 of the Area Disclosure Memorandum, (a) there
have been no events, changes or occurrences which have had, or are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Area, and (b) the Area Companies have not taken any action, or failed to take
any action, prior to the date of this Agreement, which action or failure, if
taken after the date of this Agreement, would represent or result in a material
breach or violation of any of the covenants and agreements of Area provided in
Article 7 of this Agreement.

6.8 TAX MATTERS.

(a) All Tax returns required to be filed by or on behalf
of any of the Area Companies have been timely filed or requests for extensions
have been timely filed, granted, and have not expired for periods ended on or
before December 31, 1996, except to the extent that all such failures to file,
taken together, are not reasonably likely to have a Material Adverse Effect on
Area, and all returns filed are complete and accurate in all material respects
to the Knowledge of Area. All Taxes shown as due on filed returns have been
paid. There is no audit examination, deficiency or refund Litigation with
respect to any Taxes that is reasonably likely to result in a determination
that would have, individually or in the aggregate, a Material Adverse Effect on
Area, except as reserved against in the Area Financial Statements delivered
prior to the date of this Agreement or as disclosed in Section 6.8(a) of the
Area Disclosure Memorandum. All material Taxes and other Liabilities due with
respect to completed and settled examinations or concluded Litigation have been
paid.

(b) Except as disclosed in Section 6.8(b) of the Area
Disclosure Memorandum none of the Area Companies has executed an extension or
waiver of any statute of limitations on the assessment or collection of any Tax
due that is currently in effect, and no unpaid tax deficiency has been asserted
in writing against or with respect to any Area Company, which deficiency is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Area.

(c) Adequate provision for any Taxes due or to become
due for any of the Area Companies for the period or periods through and
including the date of the respective Area Financial Statements has been made
and is reflected on such Area Financial Statements.

(d) Deferred Taxes of the Area Companies have been
provided for in accordance with GAAP.

(e) Each of the Area Companies is in compliance in all
material respects with, and its records contain all information and documents
(including, without limitation, properly completed IRS Forms W-9) necessary to
comply in all material respects with, all applicable information reporting and
Tax withholding requirements under federal, state and local Tax Laws, and such
records identify with specificity all accounts subject to backup withholding
under Section 3406 of the Internal Revenue Code, except for such instances of
noncompliance and such omissions as are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Area.

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6.9 ALLOWANCE FOR POSSIBLE LOAN LOSSES. The Allowance shown on
the consolidated balance sheets of Area included in the most recent Area
Financial Statements dated prior to the date of this Agreement was, and the
Allowance shown on the consolidated balance sheets of Area included in the Area
Financial Statements as of dates subsequent to the execution of this Agreement
will be, as of the dates thereof, adequate (within the meaning of GAAP and
applicable regulatory requirements or guidelines) to provide for losses
relating to or inherent in the loan and lease portfolios (including accrued
interest receivables) of the Area Companies and other extensions of credit
(including letters of credit and commitments to make loans or extend credit) by
the Area Companies as of the dates thereof except where the failure of such
Allowance to be so adequate is not reasonably likely to have a Material Adverse
Effect on Area.

6.10 ASSETS. Except as disclosed in Section 6.10 of the Area
Disclosure Memorandum or as disclosed or reserved against in the Area Financial
Statements, the Area Companies have good and marketable title, free and clear
of all Liens, to all of their respective Assets. All tangible properties used
in the businesses of the Area Companies are in good condition, reasonable wear
and tear excepted, and are usable in the ordinary course of business consistent
with Area's past practices. All Assets which are material to Area's business
on a consolidated basis, held under leases or subleases by any of the Area
Companies, are held under valid Contracts enforceable in accordance with their
respective terms (except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other Laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceedings may be brought), and
each such Contract is in full force and effect. The policies of fire, theft,
liability and other insurance maintained with respect to the Assets or
businesses of the Area Companies provide adequate coverage under current
industry practices against loss or Liability, and the fidelity and blanket
bonds in effect as to which any of the Area Companies is a named insured are
reasonably sufficient. The Assets of the Area Companies include all assets
required to operate the business of the Area Companies as presently conducted.

6.11 ENVIRONMENTAL MATTERS.

(a) Except as disclosed in Section 6.11(a) of the Area
Disclosure Memorandum, to the Knowledge of Area, each Area Company, its
Participation Facilities and its Loan Properties are, and have been, in
compliance with all Environmental Laws, except for violations which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Area.

(b) To the Knowledge of Area, there is no Litigation
pending or threatened before any court, governmental agency or authority or
other forum in which any Area Company or any of its Loan Properties or
Participation Facilities has been or, with respect to threatened Litigation,
may be named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material (as
defined below) or oil, whether or not occurring at, on, under or involving a
site owned, leased or operated by any Area Company or any of its Loan
Properties or Participation Facilities, except for such Litigation pending or
threatened that is not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Area and to the Knowledge of Area,
there is no reasonable basis for any such Litigation.

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(c) To the Knowledge of Area, there have been no
releases of Hazardous Material or oil in, on, under or affecting any
Participation Facility or Loan Property, except such as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Area.

6.12 COMPLIANCE WITH LAWS. Each Area Company has in effect all
Permits necessary for it to own, lease or operate its Assets and to carry on
its business as now conducted, except for those Permits the absence of which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Area, and there has occurred no Default under any such
Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Area. Except as
disclosed in Section 6.12 of the Area Disclosure Memorandum, no Area Company:

(b) has received any notification or communication from
any agency or department of federal, state, or local government or any
Regulatory Authority or the staff thereof (i) asserting that any Area Company
is not in compliance with any of the Laws or Orders which such governmental
authority or Regulatory Authority enforces, where such noncompliance is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Area, (ii) threatening to revoke any Permits, the revocation of which
is reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Area, or (iii) requiring any Area Company to enter into or
consent to the issuance of a cease and desist order, formal agreement,
directive, commitment or memorandum of understanding, or to adopt any Board
resolution or similar undertaking, which restricts materially the conduct of
its business, or in any manner relates to its capital adequacy, its credit or
reserve policies, its management, or the payment of dividends.

6.13 LABOR RELATIONS. No Area Company is the subject of any
Litigation asserting that it or any other Area Company has committed an unfair
labor practice (within the meaning of the National Labor Relations Act or
comparable state law) or seeking to compel it or any other Area Company to
bargain with any labor organization as to wages or conditions of employment,
nor is there any strike or other labor dispute involving any Area Company,
pending or, to its Knowledge, threatened, nor, to its Knowledge, is there any
activity involving any Area Company's employees seeking to certify a collective
bargaining unit or engaging in any other organization activity.

6.14 EMPLOYEE BENEFIT PLANS.

(a) Area has disclosed in Section 6.14 of the Area
Disclosure Memorandum and delivered or made available to Cardinal prior to the
execution of this Agreement copies in each case of all pension, retirement,
profit-sharing, deferred compensation, stock option, employee stock ownership,
severance pay, vacation, bonus, or other incentive plans, all other written
employee programs, arrangements, or agreements, all medical, vision, dental, or
other health plans, all life insurance plans, and all other employee benefit
plans or fringe benefit plans, including, without limitation, "employee benefit
plans" as that term is defined in Section 3(3) of ERISA, currently adopted,
maintained by, sponsored in whole or in part by, or contributed to by any Area
Company or ERISA Affiliate thereof for the benefit of employees, retirees,
dependents, spouses, directors,

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independent contractors, or other beneficiaries and under which employees,
retirees, dependents, spouses, directors, independent contractors, or other
beneficiaries are eligible to participate (collectively, the "Area Benefit
Plans"). Any of the Area Benefit Plans which is an "employee pension benefit
plan," as that term is defined in Section 3(2) of ERISA, is referred to herein
as a "Area ERISA Plan."

(b) Except as to those plans disclosed in Section
6.14(b) of the Area Disclosure Memorandum as tax-qualified Area ERISA Plans
(the "Area Qualified Plans"), no Area Company maintains or previously
maintained during the six years preceding the date of this Agreement an Area
Plan which meets or was intended to meet the requirements of Code Section
401(a). The Internal Revenue Service has issued favorable determination letters
to the effect that each Area Qualified Plan qualifies under Code Section 401(a)
and that any related trust is exempt from taxation under Code Section 501(a),
and such determination letters remain in effect and have not been revoked.
Copies of the most recent determination letters and any outstanding requests
for a determination letter with respect to each Area Qualified Plan have been
delivered or made available to Cardinal. Except as disclosed in Section 6.14(b)
of the Area Disclosure Memorandum, no Area Qualified Plan has been amended
since the issuance of each respective determination letter. The Area Qualified
Plans currently comply in form with the requirements under Code Section 401(a),
other than changes required by statutes, regulations and rulings for which
amendments are not yet required. No issue concerning qualification of the Area
Qualified Plans is pending before or is threatened by the Internal Revenue
Service. The Area Qualified Plans have been administered according to their
terms (except for those terms which are inconsistent with the changes required
by statutes, regulations, and rulings for which changes are not yet required to
be made, in which case the Area Qualified Plans have been administered in
accordance with the provisions of those statutes, regulations and rulings) and
in accordance with the requirements of Code Section 401(a). No Area Company,
any ERISA Affiliate or any fiduciary of any Area Qualified Plan has done
anything that would adversely affect the qualified status of the Area Qualified
Plans or the related trusts. Any Area Qualified Plan which is required to
satisfy Code Section 401(k)(3) and 401(m)(2) has been tested for compliance
with, and has satisfied the requirements of, Code Section 401(k)(3) and
401(m)(2) for each plan year ending prior to the date of this Agreement.

(c) All Area Benefit Plans are in compliance in all
material respects with the applicable terms of ERISA, the Internal Revenue
Code, and any other applicable Laws the breach or violation of which are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Area. To the Knowledge of Area, no Area Company nor any other party
has engaged in a transaction with respect to any Area Benefit Plan that,
assuming the taxable period of such transaction expired as of the date hereof,
would subject any Area Company to a tax or penalty imposed by either Section
4975 of the Internal Revenue Code or Section 502(i) of ERISA in amounts which
are reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Area.

(d) Neither Area nor any ERISA Affiliate of Area
maintains or has during the six years preceding the date of this Agreement
maintained an "employee benefit pension plan," within the meaning of Section
3(2) of ERISA that is or was subject to Title IV of ERISA.

(e) Neither Area nor any ERISA Affiliate of Area has any
past, present or future obligation or liability to contribute to any
multi-employer plan, as defined in Section 3(37) of ERISA.

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(f) Except as disclosed in Section 6.14(f) of the Area
Disclosure Memorandum, (i) no Area Company has any obligations for retiree
health and life benefits under any of the Area Benefit Plans and (ii) there are
no restrictions on the rights of such Area Company to amend or terminate any
such Plan without incurring any Liability thereunder, which Liability is
reasonably likely to have a Material Adverse Effect on Area, other than for
benefits accrued before the date of such termination or amendment.

(g) Except as disclosed in Section 6.14(g) of the Area
Disclosure Memorandum, neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby will (i) result in any
payment (including, without limitation, severance, unemployment compensation,
golden parachute or otherwise) becoming due to any director or any employee of
any Area Company from any Area Company under any Area Benefit Plan or
otherwise, (ii) increase any benefits otherwise payable under any Area Benefit
Plan, or (iii) result in any acceleration of the time of payment or vesting of
any such benefit.

(h) The actuarial present values of all accrued deferred
compensation entitlements (including, without limitation, entitlements under
any executive compensation, supplemental retirement, or employment agreement)
of employees and former employees of any Area Company and their respective
beneficiaries, other than entitlements accrued pursuant to funded retirement
plans subject to the provisions of Section 412 of the Internal Revenue Code or
Section 302 of ERISA, have been reflected on the Area Financial Statements to
the extent required by and in accordance with GAAP.

(i) Area and each ERISA Affiliate of Area has complied
in all material respects with applicable continuation of coverage requirements
of Section 1001 of the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended, and ERISA Sections 601 through 608.

(j) Except as disclosed in Section 6.14(j) of the Area
Disclosure Memorandum, neither Area nor any ERISA Affiliate of Area is
obligated, contingently or otherwise, under any agreement to pay any amount
which would be treated as a "parachute payment," as defined in Section 280G(b)
of the Internal Revenue Code (determined without regard to Section
280G(b)(2)(A)(ii) of the Internal Revenue Code).

(k) Other than routine claims for benefits, there are no
actions, audits, investigations, suits or claims pending, or threatened against
any Area Benefit Plan, any trust or other funding agency created thereunder, or
against any fiduciary of any Area Benefit Plan or against the assets of any
Area Benefit Plan.

6.15 MATERIAL CONTRACTS. Except as disclosed in Section 6.15 of
the Area Disclosure Memorandum or otherwise reflected in the Area Financial
Statements, none of the Area Companies, nor any of their respective Assets,
businesses or operations, is a party to, or is bound or affected by, or
receives benefits under, (a) any employment, severance, termination, consulting
or retirement Contract providing for aggregate payments to any Person in any
calendar year in excess of $25,000, excluding "at will" employment
arrangements, (b) any Contract relating to the borrowing of money by any Area
Company or the guarantee by any Area Company of any such obligation (other than
Contracts evidencing deposit liabilities, purchases of federal funds, Federal
Home Loan Bank advances, fully-secured repurchase agreements, trade payables,
and Contracts relating to borrowings

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or guarantees made in the ordinary course of business), (c) any Contracts
between or among Area Companies, and (d) any other Contract (excluding this
Agreement) or amendment thereto that would be required to be filed as an
exhibit to a Form 10-K filed by Area with the SEC as of the date of this
Agreement that has not been filed as an exhibit to Area's Form 10-K filed for
the fiscal year ended December 31, 1996, or in an SEC Document and identified
to Area (together with all Contracts referred to in Sections 6.10 and 6.14(a)
of this Agreement, the "Area Contracts"). None of the Area Companies is in
Default under any Area Contract, other than Defaults which are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Area. Except as to FHLB advances, all of the indebtedness of any Area Company
for money borrowed is prepayable at any time by such Area Company without
penalty or premium.

6.16 LEGAL PROCEEDINGS. Except as disclosed in Section 6.16 of
the Area Disclosure Memorandum, there is no Litigation instituted or pending,
or, to the Knowledge of Area, threatened (or unasserted but considered probable
of assertion and which if asserted would have at least a reasonable probability
of an unfavorable outcome) against any Area Company, or against any Asset,
interest, or right of any of them, that is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Area, nor are
there any Orders of any Regulatory Authorities, other governmental authorities,
or arbitrators outstanding against any Area Company, that are reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect on Area.

6.17 REPORTS. Except as disclosed in Section 6.17 of the Area
Disclosure Memorandum, since January 1, 1994, each Area Company has timely
filed all reports and statements, together with any amendments required to be
made with respect thereto, that it was required to file with (a) the SEC,
including, but not limited to, Forms 10-K, Forms 10-Q, Forms 8-K, and proxy
statements, (b) other Regulatory Authorities, and (c) any applicable state
securities or banking authorities (except, in the case of state securities
authorities, failures to file which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Area). As of
their respective dates, each of such reports and documents, including the
financial statements, exhibits, and schedules thereto, complied in all material
respects with all applicable Laws. As of its respective date, each such report
and document to Area's Knowledge did not, in any material respects, contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements made therein, in light
of the circumstances under which they were made, not misleading.

6.18 STATEMENTS TRUE AND CORRECT. No statement, certificate,
instrument or other writing furnished or to be furnished by any Area Company to
Cardinal pursuant to this Agreement contains or will contain any untrue
statement of material fact or will omit to state a material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading. None of the information supplied or to be supplied
by any Area Company for inclusion in the Registration Statement to be filed by
Area with the SEC, will, when the Registration Statement becomes effective, be
false or misleading with respect to any material fact, or omit to state any
material fact necessary to make the statements therein not misleading. None of
the information supplied or to be supplied by any Area Company for inclusion in
the Proxy Statement to be mailed to Area's shareholders in connection with the
Area Shareholders' Meeting, and any other documents to be filed by any Area
Company with the SEC or any other Regulatory Authority in connection with the
transactions contemplated hereby, will, at the respective time such documents
are filed, and with respect to the Proxy Statement, when first mailed to the
shareholders of Area, be false or misleading

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with respect to any material fact, or omit to state any material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading, or, in the case of the Proxy Statement or any
amendment thereof or supplement thereto, at the time of the Area Shareholders'
Meeting, be false or misleading with respect to any material fact, or omit to
state any material fact necessary to correct any statement in any earlier
communication with respect to the solicitation of any proxy for the Area
Shareholders' Meeting. All documents that any Area Company is responsible for
filing with any Regulatory Authority in connection with the transactions
contemplated hereby will comply as to form in all material respects with the
provisions of applicable Law.

6.19 ACCOUNTING, TAX AND REGULATORY MATTERS. No Area Company or,
to the Knowledge of Area, any Affiliate thereof has taken any action, or agreed
to take any action, or has any Knowledge of any fact or circumstance that is
reasonably likely to (a) prevent the transactions contemplated hereby,
including the Merger, from qualifying for pooling-of-interests accounting
treatment or treatment as a reorganization within the meaning of Section 368(a)
of the Internal Revenue Code, or (b) materially impede or delay receipt of any
Consents of Regulatory Authorities referred to in Section 9.1(b) of this
Agreement or result in the imposition of a condition or restriction of the type
referred to in the second sentence of such Section. To the Knowledge of Area,
there exists no fact, circumstance, or reason attributable to Area why the
requisite Consents referred to in Section 9.1(b) of this Agreement cannot be
received in a timely manner without the imposition of any condition or
restriction of the type described in the second sentence of such Section
9.1(b).

6.20 CHARTER PROVISIONS. Each Area Company has taken all action
so that the entering into of this Agreement and the consummation of the Merger
and the other transactions contemplated by this Agreement do not and will not
result in the grant of any rights to any Person under the Articles of
Incorporation, Bylaws or other governing instruments of any Area Company or
restrict or impair the ability of Area to vote, or otherwise to exercise the
rights of a shareholder with respect to, shares of any Area Company that may be
acquired or controlled by it.

6.21 DERIVATIVES CONTRACTS. Neither Area nor any of its
Subsidiaries is a party to or has agreed to enter into an exchange-traded or
over-the-counter swap, forward, future, option, cap, floor or collar financial
contract, or any other interest rate or foreign currency protection contract
not included on its balance sheet which is a financial derivative contract
(including various combinations thereof).

6.22 FAIRNESS OPINION. Area has received an opinion from The Bank
Advisory Group, Inc. ("BAG") that, in its opinion, the consideration to be paid
by Area to shareholders of Cardinal hereunder is fair to Area from a financial
point of view (the "BAG Fairness Opinion"), and BAG has consented to the
conclusion of the BAG Fairness Opinion in the Registration Statement.

6.23 CARDINAL COMMON STOCK. Area owns of record 78,450 shares of
Cardinal Common Stock.

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ARTICLE 7
CONDUCT OF BUSINESS PENDING CONSUMMATION

7.1 AFFIRMATIVE COVENANTS OF CARDINAL. Unless the prior written
consent of Area shall have been obtained, and except as otherwise contemplated
herein, Cardinal shall, and shall cause each of its Subsidiaries, from the date
of this Agreement until the Effective Time or termination of this Agreement:
(a) to operate its business in the usual, regular and ordinary course; (b) to
preserve intact its business organization and Assets and maintain its rights
and franchises; (c) to use its reasonable efforts to cause its representations
and warranties to be correct at all times; and (d) to take no action which
would (i) adversely affect the ability of any Party to obtain any Consents
required for the transactions contemplated hereby without imposition of a
condition or restriction of the type referred to in the last sentence of
Section 9.1(b) or 9.1(c) of this Agreement or (ii) adversely affect in any
material respect the ability of either Party to perform its covenants and
agreements under this Agreement.

7.2 NEGATIVE COVENANTS OF CARDINAL. Except as contemplated
hereby, from the date of this Agreement until the earlier of the Effective Time
or the termination of this Agreement, Cardinal covenants and agrees that it
will not do or agree or commit to do, or permit any of its Subsidiaries to do
or agree or commit to do, any of the following without the prior written
consent of the chief executive officer of Area, which consent shall not be
unreasonably withheld:

(a) amend the Articles of Incorporation, Bylaws or other
governing instruments of any Cardinal Company, or

(b) incur any additional debt obligation or other
obligation for borrowed money (other than indebtedness of a Cardinal Company to
another Cardinal Company) in excess of an aggregate of $100,000 (for the
Cardinal Companies on a consolidated basis) except in the ordinary course of
the business of Cardinal Companies consistent with past practices (which shall
include, for Cardinal, advances against its line of credit consistent with past
practices, and for any of its Subsidiaries, creation of deposit liabilities,
purchases of federal funds, advances from the Federal Reserve Bank or Federal
Home Loan Bank, and entry into repurchase agreements fully secured by U.S.
government or agency securities), or impose, or suffer the imposition, on any
Asset of any Cardinal Company of any Lien or permit any such Lien to exist
(other than in connection with deposits, repurchase agreements, bankers
acceptances, Federal Home Loan Bank advances, "treasury tax and loan" accounts
established in the ordinary course of business, the satisfaction of legal
requirements in the exercise of trust powers, and Liens in effect as of the
date hereof that are disclosed in the Cardinal Disclosure Memorandum); or

(c) repurchase, redeem, or otherwise acquire or exchange
(other than exchanges in the ordinary course under employee benefit plans),
directly or indirectly, any shares, or any securities convertible into any
shares, of the capital stock of any Cardinal Company, or declare or pay any
dividend or make any other distribution in respect of Cardinal's Common Stock;
provided that Cardinal may (to the extent legally and contractually permitted
to do so) continue to pay its regular quarterly cash dividend of up to $.20 per
share; it being understood that the parties hereto intend for Cardinal
shareholders to receive an amount equal to their regular quarterly cash
dividends as to any fiscal quarter which is at least half completed prior to
the Effective Time; or

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(d) except for this Agreement, or pursuant to the
exercise of stock options outstanding as of the date hereof and pursuant to the
terms thereof in existence on the date hereof, or as disclosed in Section
7.2(d) of the Cardinal Disclosure Memorandum, issue, sell, pledge, encumber,
authorize the issuance of or enter into any Contract to issue, sell, pledge,
encumber, or authorize the issuance of or otherwise permit to become
outstanding, any additional shares of Cardinal Common Stock or any other
capital stock of any Cardinal Company, or any stock appreciation rights, or any
option, warrant, conversion, or other right to acquire any such stock, or any
security convertible into any such stock; or

(e) adjust, split, combine or reclassify any capital
stock of any Cardinal Company or issue or authorize the issuance of any other
securities in respect of or in substitution for shares of Cardinal Capital
Stock or sell, lease, mortgage or otherwise dispose of or otherwise encumber
(i) any shares of capital stock of any Cardinal Subsidiary (unless any such
shares of stock are sold or otherwise transferred to another Cardinal Company)
or (ii) any Asset having a book value in excess of $50,000 other than in the
ordinary course of business for reasonable and adequate consideration; or

(f) except for purchases of U.S. Treasury securities,
U.S. Government agency securities or mortgage-backed securities of maturity or
grade consistent with past practices, purchase any securities or make any
material investment, either by purchase of stock or securities, contributions
to capital, Asset transfers, or purchase of any Assets, in any Person other
than a wholly-owned Cardinal Subsidiary; or otherwise acquire direct or
indirect control over any Person, other than in connection with (i)
foreclosures in the ordinary course of business, or (ii) acquisitions of
control by a Cardinal Subsidiary in its fiduciary capacity; or

(g) grant any increase in compensation or benefits to
the employees or officers of any Cardinal Company (including such discretionary
increases as may be contemplated by existing employment agreements), except in
accordance with past practice or previously approved by the Board of Directors
of Cardinal, in each case as disclosed in Section 7.2(g) of the Cardinal
Disclosure Memorandum or as required by Law; pay any severance or termination
pay or any bonus other than pursuant to written policies or written Contracts
in effect on the date of this Agreement and disclosed in Section 7.2(g) of the
Cardinal Disclosure Memorandum; enter into or amend any severance agreements
with officers of any Cardinal Company; grant any increase in fees or other
increases in compensation or other benefits to directors of any Cardinal
Company; or voluntarily accelerate the vesting of any stock options or other
stock-based compensation or employee benefits; or

(h) enter into or amend any employment Contract between
any Cardinal Company and any Person (unless such amendment is required by Law)
that the Cardinal Company does not have the unconditional right to terminate
without Liability (other than Liability for services already rendered), at any
time on or after the Effective Time; or

(i) adopt any new employee benefit plan of any Cardinal
Company or make any material change in or to any existing employee benefit
plans of any Cardinal Company other than any such change that is required by
Law or that, in the opinion of counsel, is necessary or advisable to maintain
the tax qualified status of any such plan; or

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(j) make any significant change in any Tax or accounting
methods or systems of internal accounting controls, except as may be
appropriate to conform to changes in Tax Laws or regulatory accounting
requirements or GAAP; or

(k) settle any Litigation involving any Liability of any
Cardinal Company for money damages in excess of $50,000 or material
restrictions upon the operations of any Cardinal Company; or

(l) except in the ordinary course of business, modify,
amend or terminate any material Contract or waive, release, compromise or
assign any material rights or claims.

7.3 AFFIRMATIVE COVENANTS OF AREA. Unless the prior written
consent of Cardinal shall have been obtained, and except as otherwise
contemplated herein, (a) Area shall, and shall cause each of its Subsidiaries,
from the date of this Agreement until the Effective Time or termination of this
Agreement: (i) to operate its business in the usual, regular and ordinary
course; (ii) to preserve intact its business organization and Assets and
maintain its rights and franchises; (iii) to use its reasonable efforts to
cause its representations and warranties to be correct at all times; (iv) to
take no action which would (A) adversely affect the ability of any Party to
obtain any Consents required for the transactions contemplated hereby without
imposition of a condition or restriction of the type referred to in the last
sentence of Section 9.1(b) or 9.1(c) of this Agreement or (B) adversely affect
in any material respect the ability of either Party to perform its covenants
and agreements under this Agreement; and (b) Area shall cause Interim to be
organized as a Kentucky corporation wholly-owned by Area, shall cause Interim
to execute an agreement of merger and any related documents with Cardinal in a
form to be mutually agreed upon by the Parties hereto, and shall vote all of
the issued and outstanding shares of Interim common stock held by Area in favor
of the Merger.

7.4 NEGATIVE COVENANTS OF AREA. From the date of this Agreement
until the earlier of the Effective Time or the termination of this Agreement,
Area covenants and agrees that it will not do or agree or commit to do, or
permit any of its Subsidiaries to do or agree or commit to do, any of the
following without the prior written consent of the chief executive officer of
Cardinal, which consent shall not be unreasonably withheld:

(a) amend the Articles of Incorporation, Bylaws or other
governing instruments of any Area Company, or

(b) incur any additional debt obligation or other
obligation for borrowed money (other than indebtedness of a Area Company to
another Area Company) in excess of an aggregate of $100,000 (for the Area
Companies on a consolidated basis) except in the ordinary course of the
business of Area Companies consistent with past practices (which shall include,
for any of its Subsidiaries, creation of deposit liabilities, purchases of
federal funds, advances from the Federal Reserve Bank or Federal Home Loan
Bank, and entry into repurchase agreements fully secured by U.S. government or
agency securities), or impose, or suffer the imposition, on any Asset of any
Area Company of any Lien or permit any such Lien to exist (other than in
connection with deposits, repurchase agreements, bankers acceptances, Federal
Home Loan Bank advances, "treasury tax and loan" accounts established in the
ordinary course of business, the satisfaction of legal requirements in the
exercise of trust powers, and Liens in effect as of the date hereof that are
disclosed in the Area Disclosure Memorandum); or

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(c) repurchase, redeem, or otherwise acquire or exchange
(other than exchanges in the ordinary course under employee benefit plans),
directly or indirectly, any shares, or any securities convertible into any
shares, of the capital stock of any Area Company, or declare or pay any
dividend or make any other distribution in respect of Area's Common Stock;
provided, however, that Area may (to the extent legally and contractually
permitted to do so) continue to pay its regular quarterly cash dividends of up
to $.04 per share; or

(d) except for this Agreement, or pursuant to the
exercise of stock options outstanding as of the date hereof and pursuant to the
terms thereof in existence on the date hereof, or as disclosed in Section
7.4(d) of the Area Disclosure Memorandum, issue, sell, pledge, encumber,
authorize the issuance of or enter into any Contract to issue, sell, pledge,
encumber, or authorize the issuance of or otherwise permit to become
outstanding, any additional shares of Area Common Stock or any other capital
stock of any Area Company, or any stock appreciation rights, or any option,
warrant, conversion, or other right to acquire any such stock, or any security
convertible into any such stock; or

(e) adjust, split, combine or reclassify any capital
stock of any Area Company or issue or authorize the issuance of any other
securities in respect of or in substitution for shares of Area Capital Stock or
sell, lease, mortgage or otherwise dispose of or otherwise encumber (i) any
shares of capital stock of any Area Subsidiary (unless any such shares of stock
are sold or otherwise transferred to another Area Company) or (ii) any Asset
having a book value in excess of $50,000 other than in the ordinary course of
business for reasonable and adequate consideration; or

(f) except for purchases of U.S. Treasury securities,
U.S. Government agency securities or mortgage-backed securities of maturity or
grade consistent with past practices, purchase any securities or make any
material investment, either by purchase of stock or securities, contributions
to capital, Asset transfers, or purchase of any Assets, in any Person other
than a wholly-owned Area Subsidiary; or otherwise acquire direct or indirect
control over any Person, other than in connection with (i) foreclosures in the
ordinary course of business, or (ii) acquisitions of control by an Area
Subsidiary in its fiduciary capacity; or

(g) grant any increase in compensation or benefits to
the employees or officers of any Area Company (including such discretionary
increases as may be contemplated by existing employment agreements), except in
accordance with past practice or previously approved by the Board of Directors
of Area, in each case as disclosed in Section 7.4(g) of the Area Disclosure
Memorandum or as required by Law; pay any severance or termination pay or any
bonus other than pursuant to written policies or written Contracts in effect on
the date of this Agreement and disclosed in Section 7.4(g) of the Area
Disclosure Memorandum; enter into or amend any severance agreements with
officers of any Area Company; grant any increase in fees or other increases in
compensation or other benefits to directors of any Area Company; or voluntarily
accelerate the vesting of any stock options or other stock-based compensation
or employee benefits; or

(h) enter into or amend any employment Contract between
any Area Company and any Person (unless such amendment is required by Law) that
the Area Company does not have the unconditional right to terminate without
Liability (other than Liability for services already rendered), at any time on
or after the Effective Time; or

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(i) adopt any new employee benefit plan of any Area
Company or make any material change in or to any existing employee benefit
plans of any Area Company other than any such change that is required by Law or
that, in the opinion of counsel, is necessary or advisable to maintain the tax
qualified status of any such plan; or

(j) make any significant change in any Tax or accounting
methods or systems of internal accounting controls, except as may be
appropriate to conform to changes in Tax Laws or regulatory accounting
requirements or GAAP; or

(k) settle any Litigation involving any Liability of any
Area Company for money damages in excess of $50,000 or material restrictions
upon the operations of any Area Company, except as disclosed in Section 7.14(k)
of the Area Disclosure Memorandum; or

(l) except in the ordinary course of business, modify,
amend or terminate any material Contract or waive, release, compromise or
assign any material rights or claims.

7.5 ADVERSE CHANGES IN CONDITION. Each Party agrees to give
written notice promptly to the other Party upon becoming aware of the
occurrence or impending occurrence of any event or circumstance relating to it
or any of its Subsidiaries which (a) is reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect on it or (b) is reasonably
likely to cause or constitute a material breach of any of its representations,
warranties, or covenants contained herein, and to use its reasonable efforts to
prevent or promptly to remedy the same.

7.6 REPORTS. Each Party and its Subsidiaries shall file all
reports required to be filed by it with Regulatory Authorities between the date
of this Agreement and the Effective Time and shall deliver to the other Party
copies of all non-confidential portions of such reports promptly after the same
are filed.

ARTICLE 8
ADDITIONAL AGREEMENTS

8.1 REGISTRATION STATEMENT; PROXY STATEMENT; SHAREHOLDER
APPROVAL.

(a) As soon as practicable after execution of this
Agreement, Area shall file the Registration Statement with the SEC, and shall
use its reasonable efforts to cause the Registration Statement to become
effective under the 1933 Act and take any action required to be taken under the
applicable state Blue Sky or securities Laws in connection with the issuance of
the shares of Area Common Stock upon consummation of the Merger. Cardinal shall
furnish all information concerning it and the holders of its capital stock as
Area may reasonably request in connection with such action.

(b) Both Area and Cardinal shall call a Shareholders'
Meeting, to be held as soon as reasonably practicable after the Registration
Statement is declared effective by the SEC, for the purpose of voting upon
approval of this Agreement and such other related matters as Area or Cardinal,
as the case may be, deems appropriate, including, without limitation, approval
by

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shareholders of Area of an amendment to Area's Articles of Incorporation to
increase the authorized number of shares of Area Common Stock to 50,000,000.

(c) In connection with the Cardinal Shareholders'
Meeting, (i) Area shall prepare and file with the SEC on Cardinal's behalf a
Proxy Statement (which shall be included in the Registration Statement) and
mail it to Cardinal's shareholders, (ii) the Parties shall furnish to each
other all information concerning them that they may reasonably request in
connection with such Proxy Statement, (iii) the Board of Directors of Cardinal
shall recommend (subject to compliance with the fiduciary duties of the members
of the Board of Directors as advised by counsel) to its shareholders the
approval of this Agreement and (iv) the Board of Directors and officers of
Cardinal shall use their reasonable efforts to obtain such shareholders'
approval (subject to compliance with their fiduciary duties as advised by
counsel).

(d) In connection with the Area Shareholders' Meeting,
(i) Area shall prepare and file with the SEC on its own behalf a Proxy
Statement (which shall be included in the Registration Statement) and mail it
to Area's shareholders, (ii) the Parties shall furnish to each other all
information concerning them that they may reasonably request in connection with
such Proxy Statement, (iii) the Board of Directors of Area shall recommend
(subject to compliance with the fiduciary duties of the members of the Board of
Directors as advised by counsel) to its shareholders the approval of this
Agreement and (iv) the Board of Directors and officers of Area shall use their
reasonable efforts to obtain such shareholders' approval (subject to compliance
with their fiduciary duties as advised by counsel).

8.2 EXCHANGE LISTING. Area shall list on Nasdaq the shares of
Area Common Stock to be issued to the holders of Cardinal Common Stock pursuant
to the Merger.

8.3 APPLICATIONS. Area shall promptly prepare and file, and
Cardinal shall cooperate in the preparation and, where appropriate, filing of,
any applications, including without limitation, those with the Board of
Governors of the Federal Reserve System and the Kentucky Department of
Financial Institutions, seeking the requisite Consents necessary to consummate
the transactions contemplated by this Agreement.

8.4 FILINGS WITH STATE OFFICES. Upon the terms and subject to
the conditions of this Agreement, Area shall execute and file the Articles of
Merger with the Secretary of State of the State of Kentucky in connection with
the Closing.

8.5 AGREEMENT AS TO EFFORTS TO CONSUMMATE. No Party shall take,
or cause to be taken, any action which may reasonably be foreseen as delaying
or otherwise adversely impacting consummation of the Merger. No Area Company
nor Cardinal Company shall take any action which would cause the Merger not to
be treated as a pooling of interests. Subject to the terms and conditions of
this Agreement, each Party agrees to use, and to cause its Subsidiaries to use,
its reasonable efforts to take, or cause to be taken, all actions, and to do,
or cause to be done, all things necessary, proper or advisable under applicable
Laws, as promptly as practicable so as to permit consummation of the Merger at
the earliest possible date and to otherwise enable consummation of the
transactions contemplated hereby and shall cooperate fully with the other Party
hereto to that end

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(it being understood that any amendments to the Registration Statement filed by
Area in connection with the Area Common Stock to be issued in the Merger shall
not violate this covenant), including, without limitation, using its reasonable
efforts to lift or rescind any Order adversely affecting its ability to
consummate the transactions contemplated herein and to cause to be satisfied
the conditions referred to in Article 9 of this Agreement. Each Party shall
use, and shall cause each of its Subsidiaries to use, its reasonable efforts to
obtain all Consents necessary or desirable for the consummation of the
transactions contemplated by this Agreement.

8.6 INVESTIGATION AND CONFIDENTIALITY.

(a) Prior to the Effective Time, each Party will keep
the other Party advised of all material developments relevant to its business
and to consummation of the Merger and shall permit the other Party to make or
cause to be made such investigation of the business and properties of it and
its Subsidiaries and of their respective financial and legal conditions as the
other Party reasonably requests, provided that such investigation shall be
reasonably related to the transactions contemplated hereby and shall not
interfere unnecessarily with normal operations. No investigation by a Party
shall affect the representations and warranties of the other Party.

(b) Each Party shall, and shall cause its advisers and
agents to, maintain the confidentiality of all confidential information
furnished to it by the other Party concerning its and its Subsidiaries'
businesses, operations, and financial positions and shall not use such
information for any purpose except in furtherance of the transactions
contemplated by this Agreement. If this Agreement is terminated prior to the
Effective Time, each Party shall promptly return all documents and copies
thereof and all work papers containing confidential information received from
the other Party, except for one copy of any materials prepared by that Party or
any attorney for or other representative of that Party based upon such
confidential information.

(c) Each Party agrees to give the other Party notice as
soon as practicable after any determination by it of any fact or occurrence
relating to the other Party which it has discovered through the course of its
investigation and which represents, or is reasonably likely to represent,
either a material breach of any representation, warranty, covenant or agreement
of the other Party or which has had or is reasonably likely to have a Material
Adverse Effect on the other Party.

8.7 PRESS RELEASES. Prior to the Effective Time, Cardinal and
Area shall agree with each other as to the form and substance of any press
release or other public disclosure materially related to this Agreement or any
other transaction contemplated hereby; provided, however, that nothing in this
Section 8.7 shall be deemed to prohibit any Party from making any disclosure
which its counsel deems necessary or advisable in order to satisfy such Party's
disclosure obligations imposed by Law.

8.8 ACQUISITION PROPOSALS.

(a) Except with respect to this Agreement and the
transactions contemplated hereby, no Cardinal Company nor Area Company nor any
director, employee, investment banker, attorney, accountant or other
representative thereof (collectively, "Representatives") retained by any
Cardinal Company or Area Company, as the case may be, shall directly or
indirectly solicit any

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Acquisition Proposal by any Person. Except to the extent necessary to comply
with the fiduciary duties of a Party's Board of Directors as advised by
counsel, no Cardinal Company nor Area Company nor Representative thereof, shall
furnish any non-public information that it is not legally obligated to furnish,
negotiate with respect to, or enter into any Contract with respect to, any
Acquisition Proposal, but a Party may communicate information about such an
Acquisition Proposal to its shareholders if and to the extent that it is
required to do so in order to comply with its legal obligations as advised by
counsel. Each Party shall promptly notify the other orally and in writing in
the event that it receives any inquiry or proposal relating to any such
transaction.

(b) Except as set forth herein, neither the Board of
Directors of Cardinal nor any committee thereof shall (i) withdraw or modify,
or propose to withdraw or modify, in a manner adverse to Area, the approval or
recommendation of such Board of Directors or any such committee of this
Agreement or the Merger, (ii) approve or recommend, or propose to approve or
recommend, any Acquisition Proposal or (iii) enter into any agreement with
respect to any Acquisition Proposal. Notwithstanding the foregoing, if in the
opinion of the Cardinal Board of Directors, after consultation with counsel,
failure to do so would be inconsistent with its fiduciary duties to Cardinal
shareholders under applicable law, then, prior to the Shareholders' Meeting,
the Cardinal Board of Directors may (subject to the terms of this section (b))
withdraw or modify its approval or recommendation of this Agreement or the
Merger, approve or recommend an Acquisition Proposal, or enter into an
agreement with respect to an Acquisition Proposal, in each case at any time
after the second business day following Area's receipt of written notice (a
"Notice of Acquisition Proposal") advising Area that the Cardinal Board of
Directors has received an Acquisition Proposal, specifying the material terms
and conditions of such proposal and identifying the Person making such
proposal; provided that Cardinal shall not enter into an agreement with respect
to an Acquisition Proposal unless Cardinal shall have furnished Area with
written notice no later than 12:00 noon Lexington, Kentucky time one (1) day in
advance of any date that it intends to enter into such agreement.

(c) In addition to the obligations of Cardinal set
forth in section (b) above, Cardinal shall immediately advise Area orally and in
writing of any request for information or of any Acquisition Proposal, or any
inquiry with respect to or which could lead to an Acquisition Proposal, the
material terms and conditions of such request, Acquisition Proposal or inquiry,
and the identity of the Person making an Acquisition Proposal or inquiry.
Cardinal shall keep Area fully informed of the status and details (including
amendments or proposed amendments) of any such request, Acquisition Proposal or
inquiry.

(d) Nothing contained in this Section 8.8 shall
prohibit Cardinal from making any disclosure to its shareholders if, in the
opinion of the Cardinal Board of Directors, after consultation with counsel,
failure to so disclose would be inconsistent with federal securities laws or its
fiduciary duties to its shareholders under applicable law; provided that
Cardinal does not, except as permitted by section (b) above, withdraw or modify,
or propose to withdraw or modify, its position with respect to the Merger or
approve or recommend, or propose to approve or recommend, an Acquisition
Proposal.

8.9 ACCOUNTING AND TAX TREATMENT. Each of the Parties undertakes
and agrees to use its reasonable efforts to cause the Merger, and to take no
action which would cause the Merger not,

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to qualify for treatment as a pooling of interests for accounting purposes or
as a "reorganization" within the meaning of Section 368(a) of the Internal
Revenue Code for federal income tax purposes.

8.10 AGREEMENT OF AFFILIATES. Cardinal has disclosed in Section
8.10 of the Cardinal Disclosure Memorandum all Persons whom it reasonably
believes is an "affiliate" of Cardinal for purposes of Rule 145 under the 1933
Act, and Area has disclosed in Section 8.10 of the Area Disclosure Memorandum
all Persons whom it reasonably believes to be an "affiliate" of Area for
purposes of Rule 145 under the 1933 Act. Each of Area and Cardinal shall use
its reasonable efforts to cause each such Person to deliver to Area and
Cardinal, not later than thirty (30) days after the date of this Agreement, a
written agreement, substantially in the form of Exhibit 1 as to Affiliates of
Cardinal, and substantially in the form of Exhibit 2 as to Affiliates of Area,
providing that such Person will not sell, pledge, transfer or otherwise dispose
of the shares of Cardinal Common Stock and/or Area Common Stock, as applicable,
held by such Person except as contemplated by such agreement or by this
Agreement and will not sell, pledge, transfer or otherwise dispose of the
shares of Area Common Stock to be held upon consummation of the Merger except
in compliance with applicable provisions of the 1933 Act and the rules and
regulations thereunder. Area shall be entitled to place restrictive legends
upon certificates for shares of Area Common Stock issued to Affiliates of
Cardinal pursuant to this Agreement to enforce the provisions of this Section
8.10. Area shall not be required to maintain the effectiveness of the
Registration Statement under the 1933 Act for the purposes of resale of Area
Common Stock by such Affiliates.

8.11 INDEMNIFICATION.

(a) Area shall indemnify, defend, and hold harmless the
present and former directors, officers, employees, and agents of the Cardinal
Companies (each, an "Indemnified Party") against all Liabilities arising out of
actions or omissions occurring at or prior to the Effective Time (including the
transactions contemplated by this Agreement) to the full extent permitted under
Kentucky Law and by Cardinal's Articles of Incorporation and Bylaws as in
effect on the date hereof, including provisions relating to advances of
expenses incurred in the defense of any Litigation. Without limiting the
foregoing, in any case in which approval by Area is required to effectuate any
indemnification, Area shall direct, at the election of the Indemnified Party,
that the determination of any such approval shall be made by independent
counsel mutually agreed upon between Area and the Indemnified Party.

(b) If Area or any of its successors or assigns shall
consolidate with or merge into any other Person and shall not be the continuing
or surviving Person of such consolidation or merger or shall transfer all or
substantially all of its assets to any Person, then and in each case, proper
provision shall be made so that the successors and assigns of Area shall assume
the obligations set forth in this Section 8.11.

(c) The provisions of this Section 8.11 are intended to
be for the benefit of and shall be enforceable by, each Indemnified Party, his
or her heirs and representatives.

8.12 CERTAIN MODIFICATIONS. Area and Cardinal shall consult with
respect to their loan, litigation, and real estate valuation policies and
practices (including loan classifications and levels of

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reserves) and Cardinal shall make such modifications or changes to its policies
and practices, if any, prior to the Effective Time, as may be mutually agreed
upon. Area and Cardinal also shall consult with respect to the character,
amount, and timing of restructuring and Merger-related expense charges to be
taken by each of the Parties in connection with the transactions contemplated
by this Agreement and shall take charges in accordance with GAAP, prior to the
Effective Time, as may be mutually agreed upon by the Parties. Neither
Parties' representations, warranties, and covenants contained in this Agreement
shall be deemed to be inaccurate or breached in any respect as a consequence of
any modifications or charges undertaken solely on account of this Section 8.12.

8.13 EMPLOYEE BENEFITS AND CONTRACTS. Following the Effective
Time, Area shall provide generally to officers and employees of the Cardinal
Companies who continue employment with Area or its Subsidiaries following the
Effective Time employee benefits under employee benefit plans, on terms and
conditions which when taken as a whole are substantially similar to those
currently provided by the Area Companies to their similarly situated officers
and employees. For purposes of participation and vesting (but not accrual of
benefits) under such employee benefit plans, (a) service under any qualified
defined benefit plans of Cardinal shall be treated as service under Area's
qualified defined benefit plans, (b) service under any qualified defined
contribution plans of Cardinal shall be treated as service under Area's
qualified defined contribution plans, and (c) service under any other employee
benefit plans of Cardinal shall be treated as service under any similar
employee benefit plans maintained by Area. Area and its Subsidiaries also
shall honor in accordance with their terms all employment, severance,
consulting and other compensation Contracts disclosed in Section 8.13 of the
Cardinal Disclosure Memorandum to Area between any Cardinal Company and any
current or former director, officer, or employee thereof and all provisions
for vested benefits accrued through the Effective Time under the Cardinal
Benefit Plans; it being understood that the Contracts to be assumed by Area
must be specifically listed or cross referenced at Section 8.13 of the Cardinal
Disclosure Memorandum and that no other Contracts of the type referenced in
Section 8.13 of the Cardinal Disclosure Memorandum shall be deemed to be
assumed by Area as a result of this Section 8.13. As soon as reasonably
practical following the Effective Time, Area shall register under the 1933 Act
and any applicable state securities laws, the shares of Area Common Stock
issuable pursuant to Cardinal Options.

8.14 DELIVERY TO EXCHANGE AGENT. Area shall have delivered to the
Exchange Agent a sufficient number of shares of Area Common Stock to make the
payment contemplated by Section 3.1 hereof, and sufficient cash to make the
payment contemplated by Section 3.5 hereof.

ARTICLE 9
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE

9.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective
obligations of each Party to perform this Agreement and consummate the Merger
and the other transactions contemplated hereby are subject to the satisfaction
of the following conditions, unless waived by both Parties pursuant to Section
11.6 of this Agreement:

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(a) SHAREHOLDER APPROVAL. The shareholders of both
Cardinal and Area shall have approved this Agreement, and the consummation of
the transactions contemplated hereby, including the Merger, as and to the
extent required by Law, or by the provisions of any governing instruments. The
shareholders of Area shall have approved the amendments to Area's Articles of
Incorporation referenced at Section 6.2 above to increase the authorized shares
of Area Common Stock to 50,000,000.

(b) REGULATORY APPROVALS. All Consents of, filings and
registrations with, and notifications to all Regulatory Authorities required
for consummation of the Merger shall have been obtained or made and shall be in
full force and effect and all waiting periods required by Law shall have
expired. No Consent obtained from any Regulatory Authority which is necessary
to consummate the transactions contemplated hereby shall be conditioned or
restricted in a manner (including, without limitation, requirements relating to
the raising of additional capital or the disposition of Assets) which in the
reasonable judgment of the Board of Directors of either Party would so
materially adversely impact the economic or business benefits of the
transactions contemplated by this Agreement as to render inadvisable the
consummation of the Merger. Notwithstanding the foregoing, the Parties hereto
acknowledge and agree that any condition of the Board of Governors of the
Federal Reserve System (i) related to the participation of Area, or any of its
directors, officers or affiliates, in the affairs of Security First Network
Bank, or any of Security First Network Bank's subsidiaries or affiliates, shall
not be deemed to adversely impact the benefits of the transactions contemplated
by this Agreement, and (ii) related to the participation of any of the
directors or officers of any Cardinal Company in the affairs of any Area
Company or Cardinal Company following the Merger shall not be deemed to
adversely impact the benefits of the transactions contemplated by this
Agreement.

(c) CONSENTS AND APPROVALS. Each Party shall have
obtained any and all Consents required for consummation of the Merger (other
than those referred to in Section 9.1(b) of this Agreement) or for the
preventing of any Default under any Contract or Permit of such Party which, if
not obtained or made, is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on such Party. No Consent so obtained
which is necessary to consummate the transactions contemplated hereby shall be
conditioned or restricted in a manner which in the reasonable judgment of the
Board of Directors of either party would so materially adversely impact the
economic or business benefits of the transactions contemplated by this
Agreement as to render inadvisable the consummation of the Merger.

(d) LEGAL PROCEEDINGS. No court or governmental or
regulatory authority of competent jurisdiction shall have enacted, issued,
promulgated, enforced or entered any Law or Order (whether temporary,
preliminary or permanent) or taken any other action which prohibits, restricts
or makes illegal consummation of the transactions contemplated by this
Agreement.

(e) REGISTRATION STATEMENT. The Registration Statement
shall be effective under the 1933 Act, no stop orders suspending the
effectiveness of the Registration Statement shall have been issued, no action,
suit, proceeding or investigation by the SEC to suspend the effectiveness
thereof shall have been initiated and be continuing, and all necessary
approvals under state securities

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Laws or the 1933 Act or 1934 Act relating to the issuance or trading of the
shares of Area Common Stock issuable pursuant to the Merger shall have been
received.

(f) EXCHANGE LISTING. The shares of Area Common Stock
issuable pursuant to the Merger shall have been approved for listing on Nasdaq.

(g) TAX MATTERS. Cardinal and Area shall have received
a written opinion of counsel from Powell, Goldstein, Frazer & Murphy LLP, in
form reasonably satisfactory to them (the "Tax Opinion"), to the effect that
for federal income tax purposes (i) the Merger is a reorganization within the
meaning of Section 368(a) of the Internal Revenue Code, (ii) the exchange in
the Merger of Cardinal Common Stock for Area Common Stock will not give rise to
gain or loss to the shareholders of Cardinal with respect to such exchange
(except to the extent of any cash received), (iii) the adjusted tax basis of
whole shares of Area Common Stock received by shareholders of Cardinal who
exchange shares of Cardinal Common Stock in the Merger will be the same as the
adjusted tax basis of the shares of Cardinal Common Stock exchanged therefor
(reduced by any amount allocable to a fractional share interest for which cash
is received), (iv) the holding period of the shares of Area Common Stock
received in the Merger will include the period during which the shares of
Cardinal Common Stock exchanged therefor were held, provided such shares of
Area Common Stock were held as capital assets at the Effective Time, (v) the
payment of cash to a Cardinal shareholder in lieu of a fractional share
interest in Area Common Stock will be treated as if the fractional share had
been distributed as part of the exchange and then redeemed by the Area, and
(vi) neither Cardinal nor Area will recognize gain or loss as a consequence of
the Merger (except for income and deferred gain recognized pursuant to Treasury
regulations issued under Section 1502 of the Internal Revenue Code). In
rendering such Tax Opinion, counsel shall be entitled to rely upon
representations of officers of Cardinal and Area reasonably satisfactory in
form and substance to such counsel.

(h) POOLING LETTER. The Parties shall have received a
letter from KPMG Peat Marwick LLP, dated as of the Effective Time, to the
effect that the Merger will qualify for pooling-of-interests accounting
treatment under Accounting Principles Board Opinion No. 16 if closed and
consummated in accordance with this Agreement.

9.2 CONDITIONS TO OBLIGATIONS OF AREA. The obligations of Area
to perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following
conditions, unless waived by Area pursuant to Section 11.6(a) of this
Agreement:

(a) REPRESENTATIONS AND WARRANTIES. For purposes of
this Section 9.2(a), the accuracy of the representations and warranties of
Cardinal set forth or referred to in this Agreement shall be assessed as of the
date of this Agreement and as of immediately prior to the Effective Time with
the same effect as though all such representations and warranties had been made
on and as of immediately prior to the Effective Time (provided that
representations and warranties which are confined to a specified date shall
speak only as of such date). The representations and warranties of

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Cardinal set forth in Section 5.3 of this Agreement shall be true and correct
(except for inaccuracies which are de minimus in amount or effect). The
representations and warranties of Cardinal set forth in Sections 5.19 and 5.20
of this Agreement shall be true and correct in all material respects. There
shall not exist inaccuracies in the representations and warranties of Cardinal
set forth in this Agreement (excluding the representations and warranties set
forth in Sections 5.3, 5.19 and 5.20) such that the aggregate effect of such
inaccuracies would have, or is reasonably likely to have, a Material Adverse
Effect on Cardinal; provided that, for purposes of this sentence only, those
representations and warranties which are qualified by references to "material"
or "Material Adverse Effect" shall be deemed not to include such
qualifications.

(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and
all of the agreements and covenants of Cardinal to be performed and complied
with pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied with in
all material respects.

(c) CERTIFICATES. Cardinal shall have delivered to Area
(i) a certificate, dated as of the Effective Time and signed on its behalf by
its chief executive officer and its chief financial officer, to the effect that
the conditions of its obligations set forth in Sections 9.2(a) and 9.2(b) of
this Agreement have been satisfied, and (ii) certified copies of resolutions
duly adopted by Cardinal's Board of Directors and shareholders evidencing the
taking of all corporate action necessary to authorize the execution, delivery
and performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as Area and its counsel
shall request.

(d) CLAIMS/INDEMNIFICATION LETTERS. Each of the
directors and officers of Cardinal shall have executed and delivered to Area
letters in substantially the form of Exhibit 3.

(e) AFFILIATE AGREEMENTS. Area shall have received from
each affiliate of Cardinal the affiliate letter referred to in Section 8.10
hereof.

9.3 CONDITIONS TO OBLIGATIONS OF CARDINAL. The obligations of
Cardinal to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by Cardinal pursuant to Section 11.6(b) of
this Agreement:

(a) REPRESENTATIONS AND WARRANTIES. For purposes of
this Section 9.3(a), the accuracy of the representations and warranties of Area
set forth or referred to in this Agreement shall be assessed as of the date of
this Agreement and as of immediately prior to the Effective Time with the same
effect as though all such representations and warranties had been made on and
as of immediately prior to the Effective Time (provided that representations
and warranties which are confined to a specified date shall speak only as of
such date). The representations and warranties of Area set forth in Section 6.3
of this Agreement shall be true and correct (except for inaccuracies which are
de minimus in amount or effect). The representations and warranties of Area
set forth in Section 6.19 and 6.20 of this Agreement shall be true and correct
in all material respects. There shall not exist inaccuracies in the
representations and warranties set forth in this Agreement (excluding the
representations and warranties set forth in Sections 6.3, 6.19 and 6.20) such
that the aggregate effect of such inaccuracies would have, or is reasonably
likely to have a Material Adverse Effect on Area; provided that, for purposes
of this sentence only, those representations and

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warranties which are qualified by reference to "material" or "Material Adverse
Effect" shall be deemed not to include such qualifications.

(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and
all of the agreements and covenants of Area to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby prior
to the Effective Time shall have been duly performed and complied with in all
material respects.

(c) CERTIFICATES. Area shall have delivered to Cardinal
(i) a certificate, dated as of the Effective Time and signed on its behalf by
its chief executive officer and its chief financial officer, to the effect that
the conditions of its obligations set forth in Section 9.3(a) and 9.3(b) of
this Agreement have been satisfied, and (ii) certified copies of resolutions
duly adopted by Area's Board of Directors evidencing the taking of all
corporate action necessary to authorize the execution, delivery and performance
of this Agreement, and the consummation of the transactions contemplated
hereby, all in such reasonable detail as Cardinal and its counsel shall
request.

(d) AFFILIATE AGREEMENTS. Cardinal shall have received
from each affiliate of Area the affiliate letter referred to in Section 8.10
hereof.

ARTICLE 10
TERMINATION

10.1 TERMINATION. Notwithstanding any other provision of this
Agreement, and notwithstanding the approval of this Agreement by the
shareholders of Area and Cardinal, this Agreement may be terminated and the
Merger abandoned at any time prior to the Effective Time:

(a) By mutual consent of the Board of Directors of Area
and the Board of Directors of Cardinal; or

(b) By the Board of Directors of either Party (provided
that the terminating Party is not then in breach of any representation or
warranty contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Cardinal and Section 9.3(a) in
the case of Area or in the material breach of any covenant or other covenant or
agreement contained in this Agreement) in the event of a material breach by the
other Party of any representation or warranty contained in this Agreement which
cannot be or has not been cured within thirty (30) days after the giving of
written notice to the breaching Party of such breach and which breach would
provide the non-breaching Party the ability to refuse to consummate the Merger
under the standard set forth in Section 9.2(a) of this Agreement in the case of
Area and Section 9.3(a) of this Agreement in the case of Cardinal; or

(c) By the Board of Directors of either Party (provided
that the terminating Party is not then in breach of any representation or
warranty contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Cardinal and Section 9.3(a) in
the case of Area or in the material breach of any covenant or other covenant or
agreement

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contained in this Agreement) in the event of a material breach by the other
Party of any covenant or agreement contained in this Agreement which cannot be
or has not been cured within thirty (30) days after the giving of written
notice to the breaching Party of such breach; or

(d) By the Board of Directors of either Party in the
event (provided that the terminating Party is not then in breach of any
representation or warranty contained in this Agreement under the applicable
standard set forth in Section 9.2(a) of this Agreement in the case of Cardinal
and Section 9.3(a) in the case of Area or in the material breach of any
covenant or other covenant or agreement contained in this Agreement) (i) any
Consent of any Regulatory Authority required for consummation of the Merger and
the other transactions contemplated hereby shall have been denied by final
nonappealable action of such authority or if any action taken by such authority
is not appealed within the time limit for appeal, or (ii) if the shareholders
of Cardinal fail to vote their approval of this Agreement and the transactions
contemplated hereby as required by the KBCA at the Shareholders' Meeting where
the transactions were presented to such shareholders for approval and voted
upon; or (iii) if the shareholders of Area fail to vote their approval of this
Agreement and the transactions contemplated hereby as required by the KBCA, and
the increase in authorized Area Common Stock, as contemplated by Section 6.3
above, at the Shareholders' Meeting where the transactions were presented to
such shareholders for approval and voted upon; or

(e) By the Board of Directors of either Party in the
event that the Merger shall not have been consummated on or before December 31,
1997, but only if the failure to consummate the transactions contemplated
hereby on or before such date is not caused by any breach of this Agreement by
the Party electing to terminate pursuant to this Section 10.1(e); or

(f) By the Board of Directors of either Party (provided
that the terminating Party is not then in breach of any representation or
warranty contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of Cardinal and Section 9.3(a) in
the case of Area or in the material breach of any covenant or other covenant or
agreement contained in this Agreement) in the event that any of the conditions
precedent to the obligations of such Party to consummate the Merger (other than
as contemplated by Section 10.1(d) of this Agreement) cannot be satisfied or
fulfilled by the date specified in Section 10.1(e) of this Agreement; or

(g) By the Board of Directors of Cardinal in connection
with entering into a definitive agreement in accordance with Section 8.8(b),
provided that it has complied with all provisions thereof, including the notice
provisions therein, and that it makes simultaneous payment of the Termination
Fee.

10.2 EFFECT OF TERMINATION. In the event of the termination and
abandonment of this Agreement pursuant to Section 10.1 of this Agreement, this
Agreement shall become void and have no effect, except that the provisions of
this Section 10.2 and Sections 11.1 and 11.2 and 8.6(b) of this Agreement shall
survive any such termination and abandonment.

10.3 NON-SURVIVAL OF REPRESENTATIONS AND COVENANTS. The respective
representations, warranties, obligations, covenants, and agreements of the
Parties shall not survive the Effective Time

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except for this Section 10.3 and Articles 2, 3 and 4 and Sections 8.10, 8.11,
8.13, 11.1 and 11.2 of this Agreement.

ARTICLE 11
MISCELLANEOUS

11.1 DEFINITIONS. Except as otherwise provided herein, the
capitalized terms set forth below (in their singular and plural forms as
applicable) shall have the following meanings:

"1933 ACT" shall mean the Securities Act of 1933, as amended.

"1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended.

"ACQUISITION PROPOSAL" with respect to a Party shall mean any
tender offer or exchange offer or any proposal for a merger (other than
the Merger), acquisition of all of the stock or Assets of, or other
business combination involving such Party or any of its Subsidiaries or
the acquisition of a substantial equity interest in, or a substantial
portion of the Assets of such Party or any of its Subsidiaries.

"AFFILIATE" of a Person shall mean any person who is an
affiliate for purposes of Rule 145 under the 1933 Act and for purposes of
qualifying the Merger for pooling of interests accounting treatment.

"AGREEMENT" shall mean this Agreement and Plan of Merger,
including the Exhibits delivered pursuant hereto and incorporated herein
by reference.

"ALLOWANCE" shall have the meaning provided in Section 5.9 of
this Agreement.

"AREA BENEFIT PLANS" shall have the meaning set forth in
Section 6.14 of this Agreement.

"AREA CAPITAL STOCK" shall mean, collectively, the Area
Common Stock and any other class or series of capital stock of Area.

"AREA COMMON STOCK" shall mean the no par value common stock
of Area.

"AREA COMPANIES" shall mean, collectively, Area and all Area
Subsidiaries.

"AREA DISCLOSURE MEMORANDUM" shall mean the written
information entitled "Area Disclosure Memorandum" delivered on or prior
to the date of this Agreement to Cardinal describing in reasonable detail
the matters contained therein.

"AREA FINANCIAL STATEMENTS" shall mean (a) the consolidated
balance sheets (including related notes and schedules, if any) of Area as
of December 31, 1996 and 1995,

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and the related statements of income, changes in shareholders' equity,
and cash flows (including related notes and schedules, if any) for each
of the three years ended December 31, 1996, 1995 and 1994, as filed by
Area in SEC Documents and (b) the consolidated balance sheets (including
related notes and schedules, if any) of Area and related statements of
income, changes in shareholders' equity, and cash flows (including
related notes and schedules, if any) included in SEC Documents filed with
respect to periods ended subsequent to December 31, 1996.

"AREA STOCK PLANS" shall mean the existing stock option and
other stock-based compensation plans and agreements of Area disclosed in
Section 6.14 of the Area Disclosure Memorandum.

"AREA SUBSIDIARIES" shall mean the direct and indirect
Subsidiaries of Area.

"ASSETS" of a Person shall mean all of the assets,
properties, businesses and rights of such Person of every kind, nature,
character and description, whether real, personal or mixed, tangible or
intangible, accrued or contingent, or otherwise relating to or utilized
in such Person's business, directly or indirectly, in whole or in part,
whether or not carried on the books and records of such Person, and
whether or not owned in the name of such Person or any Affiliate of such
Person and wherever located.

"BHC ACT" shall mean the federal Bank Holding Company Act of
1956, as amended.

"CARDINAL BENEFIT PLANS" shall have the meaning set forth in
Section 5.14 of this Agreement.

"CARDINAL COMMON STOCK" shall mean the no par value common
stock of Cardinal.

"CARDINAL COMPANIES" shall mean, collectively, Cardinal and
all Cardinal Subsidiaries.

"CARDINAL DISCLOSURE MEMORANDUM" shall mean the written
information entitled "Cardinal Disclosure Memorandum" delivered on or
prior to the date of this Agreement to Area describing in reasonable
detail the matters contained therein.

"CARDINAL FINANCIAL STATEMENTS" shall mean (a) the
consolidated balance sheets (including related notes and schedules, if
any) of Cardinal as of December 31, 1996 and 1995, and the related
statements of income, changes in shareholders' equity, and cash flows
(including related notes and schedules, if any) for each of the three
years ended December 31, 1996, 1995 and 1994, as filed by Cardinal in SEC
Documents, and (b) the consolidated balance sheets (including related
notes and schedules, if any) of Cardinal and related statements of
income, changes in shareholders' equity, and cash flows (including
related notes and schedules, if any) filed with respect to periods ended
subsequent to December 31, 1996.

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"CARDINAL OPTIONS" shall have the meaning set forth in Section
3.4 of this Agreement.

"CARDINAL STOCK PLANS" shall mean the existing stock option
and other stock-based compensation plans and agreements of Cardinal
disclosed in Section 5.14 of the Cardinal Disclosure Memorandum.

"CARDINAL SUBSIDIARIES" shall mean the direct and indirect
subsidiaries of Cardinal.

"CLOSING" shall mean the closing of the transactions
contemplated hereby, as described in Section 1.2 of this Agreement.

"CLOSING DATE" shall mean the date on which the Closing
occurs.

"CONSENT" shall mean any consent, approval, authorization,
clearance, exemption, waiver, or similar affirmation by any Person
pursuant to any Contract, Law, Order, or Permit.

"CONTRACT" shall mean any written or oral agreement,
arrangement, authorization, commitment, contract, indenture, instrument,
lease, obligation, plan, practice, restriction, understanding or
undertaking of any kind or character, or other document to which any
Person is a party or that is binding on any Person or its capital stock,
Assets or business.

"DEFAULT" shall mean (a) any breach or violation of or
default under any Contract, Order or Permit, (b) any occurrence of any
event that with the passage of time or the giving of notice or both would
constitute a breach or violation of or default under any Contract, Order
or Permit, or (c) any occurrence of any event that with or without the
passage of time or the giving of notice would give rise to a right to
terminate or revoke, change the current terms of, or renegotiate, or to
accelerate, increase, or impose any Liability under, any Contract, Order
or Permit.

"EFFECTIVE TIME" shall mean the date and time at which the
Merger becomes effective as defined in Section 1.3 of this Agreement.

"ENVIRONMENTAL LAWS" shall mean all Laws pertaining to
pollution or protection of the environment and which are administered,
interpreted or enforced by the United States Environmental Protection
Agency and state and local agencies with primary jurisdiction over
pollution or protection of the environment.

"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.

"ERISA AFFILIATE" shall refer to a relationship between
entities such that the entities would, now or at any time in the past,
constitute a "single employer" within the meaning of Section 414 of the
Code.

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"ERISA PLAN" shall have the meaning provided in Section 5.14
of this Agreement.

"EXCHANGE RATIO" shall have the meaning provided in Section
3.1(b) of this Agreement.

"EXHIBITS" 1 and 2, inclusive, shall mean the Exhibits so
marked, copies of which are attached to this Agreement. Such Exhibits
are hereby incorporated by reference herein and made a part hereof and
may be referred to in this Agreement and any other related instrument or
document without being attached hereto.

"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.

"HAZARDOUS MATERIAL" shall mean any pollutant, contaminant,
or toxic or hazardous substance, pollutant, chemical or waste within the
meaning of the Comprehensive Environment Response, Compensation, and
Liability Act, 42 U.S.C. Section 9601 et seq., or any similar federal,
state or local Law (and specifically shall include asbestos requiring
abatement, removal or encapsulation pursuant to the requirements of
governmental authorities, polychlorinated biphenyls, and petroleum and
petroleum products).

"HOLA" shall mean the Home Owners' Loan Act of 1933, as
amended.

"INTERNAL REVENUE CODE" shall mean the Internal Revenue Code
of 1986, as amended, and the rules and regulations promulgated
thereunder.

"KBCA" shall mean the Kentucky Business Corporation Act.

"KENTUCKY ARTICLES OF MERGER" shall mean the Articles of
Merger to be filed with the Secretary of State of the State of Kentucky
relating to the Merger as contemplated by Section 1.1 of this Agreement.

"KNOWLEDGE" as used with respect to Cardinal or Area, as the
case may be, shall mean the actual knowledge of the Chairman, President,
Chief Financial Officer, Chief Accounting Officer, Chief Credit Officer,
General Counsel, any Assistant or Deputy General Counsel, or any Senior
or Executive Vice President of such Person.

"LAW" shall mean any code, law, ordinance, regulation,
reporting or licensing requirement, rule, or statute applicable to a
Person or its Assets, Liabilities or business, including, without
limitation, those promulgated, interpreted or enforced by any of the
Regulatory Authorities.

"LIABILITY" shall mean any direct or indirect, primary or
secondary, liability, indebtedness, obligation, penalty, cost or expense
(including, without limitation, costs of investigation, collection and
defense), claim, deficiency, guaranty or endorsement of or by any Person
(other than endorsements of notes, bills, checks, and drafts presented
for

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50
collection or deposit in the ordinary course of business) of any type,
whether accrued, absolute or contingent, liquidated or unliquidated,
matured or unmatured, or otherwise.

"LIEN" shall mean any conditional sale agreement, default of
title, easement, encroachment, encumbrance, hypothecation, infringement,
lien, mortgage, pledge, reservation, restriction, security interest,
title retention or other security arrangement, or any adverse right or
interest, charge, or claim of any nature whatsoever of on, or with
respect to any property or property interest, other than (i) Liens for
current property Taxes not yet due and payable. (ii) for depository
institution Subsidiaries of a Party, pledges to secure deposits and other
Liens incurred in the ordinary course of the banking business.

"LITIGATION" shall mean any action, arbitration, cause of
action, claim, complaint, criminal prosecution, demand letter,
governmental or other examination or investigation, hearing, inquiry,
administrative or other proceeding, or notice (written or oral) by any
Person alleging potential Liability or requesting information relating to
or affecting a Party, its business, its Assets (including, without
limitation, Contracts related to it), or the transactions contemplated by
this Agreement, but shall not include regular, periodic examinations of
depository institutions and their Affiliates by Regulatory Authorities.

"LOAN PROPERTY" shall mean any property owned by the Party in
question or by any of its Subsidiaries or in which such Party or
Subsidiary holds a security interest, and, where required by the context,
includes the owner or operator of such property, but only with respect to
such property.

"MATERIAL" for purposes of this Agreement shall be determined
in light of the facts and circumstances of the matter in question;
provided that any specific monetary amount stated in this Agreement shall
determine materiality in that instance.

"MATERIAL ADVERSE EFFECT" on a Party shall mean an event,
change or occurrence which has a material adverse impact on (a) the
financial position, business, or results of operations of such Party and
its Subsidiaries, taken as a whole, or (b) the ability of such Party to
perform its obligations under this Agreement or to consummate the Merger
or the other transactions contemplated by this Agreement, provided that
"material adverse impact" shall not be deemed to include the impact of
(v) changes in banking and similar Laws of general applicability or
interpretations thereof by courts or governmental authorities, (w)
changes in GAAP or regulatory accounting principles generally applicable
to banks and their holding companies, (x) actions and omissions of a
Party (or any of its Subsidiaries) taken with the prior informed consent
of the other Party in contemplation of the transactions contemplated
hereby, (y) the Merger and compliance with the provisions of this
Agreement on the operating performance of the Parties or (z) changes in
economic or other conditions affecting the banking industry in general.

"MERGER" shall mean the merger of Interim with and into
Cardinal referred to in Section 1.1 of this Agreement.

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"NASD" shall mean the National Association of Securities
Dealers, Inc., including the Nasdaq.

"NASDAQ" shall mean the National Market System of the Nasdaq
Stock Market.

"ORDER" shall mean any administrative decision or award,
decree, injunction, judgment, order, quasi-judicial decision or award,
ruling, or writ of any federal, state, local or foreign or other court,
arbitrator, mediator, tribunal, administrative agency or Regulatory
Authority.

"PARTICIPATION FACILITY" shall mean any facility or property
in which the Party in question or any of its Subsidiaries participates in
the management (including any property or facility held in a joint
venture) and, where required by the context, said term means the owner or
operator of such facility or property, but only with respect to such
facility or property.

"PARTY" shall mean either Cardinal or Area, and "Parties"
shall mean both Cardinal and Area.

"PERMIT" shall mean any federal, state, local, and foreign
governmental approval, authorization, certificate, easement, filing,
franchise, license, notice, permit, or right to which any Person is a
party or that is or may be binding upon or inure to the benefit of any
Person or its securities, Assets, Liabilities, or business.

"PERSON" shall mean a natural person or any legal, commercial
or governmental entity, such as, but not limited to, a corporation,
general partnership, joint venture, limited partnership, limited
liability company, trust, business association, group acting in concert,
or any person acting in a representative capacity.

"PROXY STATEMENT" shall mean (a) the proxy statement used by
Cardinal to solicit the approval of its shareholders of the transactions
contemplated by this Agreement and (b) the proxy statement used by Area
to solicit the approval of its shareholders of the transactions
contemplated by this Agreement, both of which shall be included in the
prospectus of Area relating to shares of Area Common Stock to be issued
to the shareholders of Cardinal.

"REGISTRATION STATEMENT" shall mean the Registration
Statement on Form S-4, or other appropriate form, filed with the SEC by
Area under the 1933 Act with respect to the shares of Area Common Stock
to be issued to the shareholders of Cardinal in connection with the
transactions contemplated by this Agreement and which shall include the
Proxy Statements.

"REGULATORY AUTHORITIES" shall mean, collectively, the
Federal Trade Commission, the United States Department of Justice, the
Board of the Governors of the Federal Reserve System, the Office of
Thrift Supervision (including its predecessor, the Federal Home Loan Bank
Board), the Office of the Comptroller of the Currency, the Federal
Deposit Insurance

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Corporation, all state regulatory agencies having jurisdiction over the
Parties and their respective Subsidiaries, the NASD and the SEC.

"RIGHTS" shall mean all arrangements, calls, commitments,
Contracts, options, rights to subscribe to, scrip, understandings,
warrants or other binding obligations of any character whatsoever
relating to, or securities or rights convertible into or exchangeable
for, shares of the capital stock of a Person or by which a Person is or
may be bound to issue additional shares of its capital stock or other
Rights.

"SEC" shall mean the United States Securities and Exchange
Commission.

"SEC DOCUMENTS" shall mean all forms, proxy statements,
registration statements, reports, schedules and other documents filed, or
required to be filed, by a Party or any of its Subsidiaries with any
Regulatory Authority pursuant to the Securities Laws.

"SECURITIES LAWS" shall mean the 1933 Act, the 1934 Act, the
Investment Company Act of 1940, as amended, the Investment Advisors Act
of 1940, as amended, the Trust Indenture Act of 1939, as amended, and the
rules and regulations of any Regulatory Authority promulgated thereunder.

"SHAREHOLDERS' MEETING" shall mean the meeting of the
shareholders of Cardinal or the meeting of the shareholders of Area to be
held pursuant to Section 8.1 of this Agreement, including any adjournment
or adjournments thereof.

"SUBSIDIARIES" shall mean all those corporations, banks,
associations, partnerships or other entities or ventures of which the
entity in question owns or controls 50% or more of the outstanding equity
securities or the ownership interest, as the case may be, either directly
or through an unbroken chain of entities as to each of which 50% or more
of the outstanding equity securities is owned directly or indirectly by
its parent; provided, however, there shall not be included any such
entity acquired through foreclosure or any such entity the equity
securities of which are owned or controlled in a fiduciary capacity.

"SURVIVING CORPORATION" shall mean Cardinal as the surviving
corporation resulting from the Merger.

"TAX" OR "TAXES" shall mean any federal, state, county, local
or foreign income, profits, franchise, gross receipts, payroll, sales,
employment, use, property, withholding, excise, occupancy and other
taxes, assessments, charges, fares or impositions, including interest,
penalties and additions imposed thereon or with respect thereto.

Any singular term in this Agreement shall be deemed to include the plural, and
any plural term the singular. Whenever the words "include," "includes," or
"including" are used in this Agreement, they shall be deemed followed by the
words "without limitation."

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11.2 EXPENSES.

(a) Except as otherwise provided in this Section 11.2, each
of the Parties shall bear and pay all direct costs and expenses incurred by it
or on its behalf in connection with the transactions contemplated hereunder,
including filing, registration and application fees, printing fees, and fees
and expenses of its own financial or other consultants, investment bankers,
accountants and counsel, except that each of the Parties shall bear and pay (i)
one-half of the filing fees payable in connection with the Registration
Statement and the applications filed with other Regulatory Authorities, and
(ii) one-half of the costs incurred in connection with the printing or copying
of the Proxy Statements.

(b) Cardinal shall pay, or cause to be paid, in same day
funds to Area the sum of $7 million (the "Termination Fee") upon demand (i) if
Cardinal terminates this Agreement pursuant to Section 10.1(g), or (ii) if
prior to the termination of this Agreement solely as a result of Cardinal
shareholders not having approved the Merger by the requisite vote, a bona fide
publicly disclosed Acquisition Proposal shall have been made and not publicly
withrawn prior to the meeting of Cardinal shareholders to consider the Merger
and within 18 months after such termination, Cardinal consummates the
transaction which was the subject of such or any other Acquisition Proposal for
consideration to Cardinal shareholders which is at least equal to $63 per
share.
(c) Nothing in this Section 11.2 shall constitute or
shall be deemed to constitute liquidated damages for the willful breach by a
Party of the terms of this Agreement or otherwise limit the rights of the
non-breaching Party.

11.3 BROKERS AND FINDERS. Except as set forth in the Area or
Cardinal Disclosure Memorandum, each of the Parties represents and warrants
that neither it nor any of its officers, directors, employees or Affiliates has
employed any broker or finder or incurred any Liability for any financial
advisory fees, investment bankers' fees, brokerage fees, commissions, or
finders' fees in connection with this Agreement or the transactions
contemplated hereby. In the event of a claim by any broker or finder based
upon his or its representing or being retained by or allegedly representing or
being retained by Cardinal or Area, each of Cardinal and Area, as the case may
be, agrees to indemnify and hold the other Party harmless of and from any
Liability in respect of any such claim.

11.4 ENTIRE AGREEMENT. Except as otherwise expressly provided
herein, this Agreement (including the documents and instruments referred to
herein) constitutes the entire agreement between the Parties with respect to
the transactions contemplated hereunder and supersedes all prior arrangements
or understandings with respect thereto, written or oral. Nothing in this
Agreement expressed or implied, is intended to confer upon any Person, other
than the Parties or their respective successors, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, other than as
provided in Section 8.10 and Section 8.13 of this Agreement.

11.5 AMENDMENTS. To the extent permitted by Law, this Agreement
may be amended by a subsequent writing signed by each of the Parties upon the
approval of the Boards of Directors of each of the Parties; provided, however,
that after any such approval by the holders of Cardinal

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Common Stock or Area Common Stock, there shall be made no amendment that
pursuant to the KBCA requires further approval by such shareholders without the
further approval of such shareholders.

11.6 WAIVERS.

(a) Prior to or at the Effective Time, Area, acting
through its Board of Directors, chief executive officer or other authorized
officer, shall have the right to waive any Default in the performance of any
term of this Agreement by Cardinal, to waive or extend the time for the
compliance or fulfillment by Cardinal of any and all of its obligations under
this Agreement, and to waive any or all of the conditions precedent to the
obligations of Area under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of Area.

(b) Prior to or at the Effective Time, Cardinal, acting
through its Board of Directors, chief executive officer or other authorized
officer, shall have the right to waive any Default in the performance of any
term of this Agreement by Area, to waive or extend the time for the compliance
or fulfillment by Area of any and all of its obligations under this Agreement,
and to waive any or all of the conditions precedent to the obligations of
Cardinal under this Agreement, except any condition which, if not satisfied,
would result in the violation of any Law. No such waiver shall be effective
unless in writing signed by a duly authorized officer of Cardinal.

(c) The failure of any Party at any time or times to
require performance of any provision hereof shall in no manner affect the right
of such Party at a later time to enforce the same or any other provision of
this Agreement. No waiver of any condition or of the breach of any term
contained in this Agreement in one or more instances shall be deemed to be or
construed as a further or continuing waiver of such condition or breach or a
waiver of any other condition or of the breach of any other term of this
Agreement.

11.7 ASSIGNMENT. Except as expressly contemplated hereby, neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by any Party hereto (whether by operation of Law or otherwise)
without the prior written consent of the other Party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the Parties and their respective successors and assigns.

11.8 NOTICES. All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
by hand, by facsimile transmission, by registered or certified mail, postage
pre-paid, or by courier or overnight carrier, to the persons at the addresses
set forth below (or at such other address as may be provided hereunder), and
shall be deemed to have been delivered as of the date so delivered:

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Area: Area Bancshares Corporation
230 Frederica Street
Owensboro, Kentucky 42301

Attn: Thomas R. Brumley
President and CEO

With a copy (which shall not constitute notice) to:

Area Bancshares Corporation
230 Frederica Street
Owensboro, Kentucky 42301

Attn: Timothy O. Shelburne, Esq.
General Counsel

and: Powell, Goldstein, Frazer & Murphy LLP
Sixteenth Floor
191 Peachtree Street, N.E.
Atlanta, Georgia 30303

Attn: Kathryn L. Knudson, Esq.

Cardinal: Cardinal Bancshares, Inc.
400 East Vine Street
Suite 300
Lexington, Kentucky 40507

Attn: John S. Penn
President and CEO

With a copy (which shall not constitute notice):

Hogan and Hartson L.L.P.
555 13th Street, N.W.
Washington, D.C. 20004

Attn: Stuart G. Stein, Esq.

11.9 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the Laws of the State of Kentucky, without regard
to any applicable conflicts of Laws, except to the extent that the federal laws
of the United States may apply to the Merger.

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11.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.

11.11 CAPTIONS. The captions contained in this Agreement are for
reference purposes only and are not part of this Agreement.

11.12 ENFORCEMENT OF AGREEMENT. The Parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that the Parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any court of the
United States or any state having jurisdiction, this being in addition to any
other remedy to which they are entitled at law or in equity.

11.13 SEVERABILITY. Any term or provision of this Agreement which
is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.

[SIGNATURES ON NEXT PAGE]

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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf and its corporate seal to be hereunto affixed and
attested by officers thereunto as of the day and year first above written.

ATTEST: AREA BANCSHARES CORPORATION

/s/ Judith R. Windle By: /s/ Thomas R. Brumley
- ------------------------- ------------------------------------------
Secretary Thomas R. Brumley
President and CEO

[CORPORATE SEAL]

ATTEST: CARDINAL BANCSHARES, INC.

/s/ Carolyn L. Gabriel By: /s/ John S. Penn
- ------------------------- -----------------------------------------
Secretary John S. Penn
President and CEO

[CORPORATE SEAL]

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The undersigned, a director of Cardinal Bancshares, Inc. ("Cardinal"),
hereby agrees (subject to fiduciary duties) to support, recommend favorably to
the shareholders, and to personally vote his or her shares of Cardinal Common
Stock (and those over which he or she has voting power) in favor of, the
Agreement and Plan of Merger dated as of May 1, 1997 to which this signature
page is attached, and the transactions contemplated thereby.

-------------------------------------------
(Signature)

-------------------------------------------
(Print Name)

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59

The undersigned, a director of Area Bancshares Corporation ("Area"),
hereby agrees (subject to fiduciary duties) to support, recommend favorably to
the shareholders, and to personally vote his or her shares of Area Common Stock
(and those over which he or she has voting power) in favor of, the Agreement
and Plan of Merger dated as of May 1, 1997 to which this signature page is
attached, and the transactions contemplated thereby.

-------------------------------------------
(Signature)

-------------------------------------------
(Print Name)

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60
EXHIBIT 1

CARDINAL BANCSHARES, INC.
AFFILIATE AGREEMENT

This AFFILIATE AGREEMENT, dated as of May 1, 1997, is entered into by
and between Area Bancshares Corporation ("Area"), a Kentucky corporation, and
each of the stockholders of Cardinal Bancshares, Inc. ("Cardinal"), a Kentucky
corporation, named on Schedule I hereto (collectively, the "Stockholders"), who
are directors, executive officers or other affiliates of Cardinal (for purposes
of Rule 145 under the Securities Act of 1933, as amended, and for purposes of
qualifying the Merger (defined below) for "pooling-of-interests" accounting
treatment).

WHEREAS, Area and Cardinal have entered into an Agreement and Plan of
Merger, dated as of May 1, 1997 (the "Merger Agreement"), which provides for,
among other things, the merger of a subsidiary of Area with and into Cardinal,
in a stock-for-stock transaction (the "Merger");

NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

1. OWNERSHIP OF CARDINAL COMMON STOCK. Each Stockholder
represents and warrants that the number of shares of Cardinal common stock
("Cardinal Common Stock"), set forth opposite such Stockholder's name on
Schedule I hereto is the total number of shares of Cardinal Common Stock over
which such person has "beneficial ownership" within the meaning of Rule 13d-3
under the Securities Exchange Act of 1934, as amended, except that the
provisions of Rule 13d-3(d)(1(i) shall be considered without any limit as to
time.

2. AGREEMENTS OF THE STOCKHOLDERS. Each Stockholder covenants
and agrees that:

(a) Except as otherwise expressly permitted hereby, such
Stockholder shall not, prior to the consummation of the Merger or the earlier
termination of this Affiliate Agreement in accordance with its terms, sell,
pledge, transfer or otherwise dispose of his or her shares of Cardinal Common
Stock; provided, however, that this Section 2(a) shall not apply to a pledge
existing as of May 1, 1997.

(b) Such Stockholder shall not in his or her capacity as
a stockholder of Cardinal directly or indirectly encourage or solicit or hold
discussions or negotiations with, or provide any information to, any person,
entity or group (other than Area or an affiliate thereof) concerning any
merger, sale of all or substantially all of the assets or liabilities not in
the ordinary course of business, sale of shares of capital stock or similar
transaction

61
involving Cardinal. Nothing herein shall impair such Stockholder's fiduciary
obligations as a director of Cardinal.

(c) Such Stockholder shall use his or her best efforts to
take or cause to be taken all action, and to do or cause to be done all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the Merger contemplated by this Affiliate
Agreement.

(d) Such Stockholder shall not, prior to the public
release by Area of an earnings report to its stockholders covering at least one
month of operations after consummation of the Merger (the "Restricted Period"),
sell, pledge (other than the replacement of a pledge existing on May 1, 1997 of
Cardinal Common Stock), transfer or otherwise dispose of the shares of Area
common stock (the "Area Common Stock"), to be received by him or her for his or
her shares of Cardinal Common Stock upon consummation of the Merger, it being
agreed that Area shall publish such earnings report no later than 45 days after
the end of the first financial quarter in which there are at least 30 days of
post-Merger combined operations.

(e) Such Stockholder shall comply with all applicable
federal and state securities laws in connection with any sale of Area Common
Stock received in exchange for Cardinal Common Stock in the Merger, including
the trading and volume limitations as to sales by affiliates contained in Rule
145 under the Securities Act of 1933, as amended.

(f) During the Restricted Period, such Stockholder shall
not sell or otherwise dispose of a number of shares of his or her Cardinal
Common Stock, or shares of Area Common Stock which are exchanged for said
shares, (i) which is greater than 10% of his or her beneficial ownership of
said shares as of the date of the first such sale and (ii) which in the
aggregate with shares sold or otherwise disposed of by all other Stockholders
will be greater than 1% of the issued and outstanding shares of Cardinal Common
Stock as of the date of the first such sale. For purposes of this computation,
outstanding stock options that currently are exercisable would be considered as
outstanding or beneficially owned after such options are converted to common
stock equivalents using the treasury stock method in accordance with generally
accepted accounting principles.

(g) Such Stockholder has no present plan or intent, and
as of the effective time of the Merger, shall have no present plan or intent,
to engage in a sale, exchange, transfer, distribution (including a distribution
by a corporation to its shareholders), redemption, or reduction in any way of
such Stockholder's risk of ownership by short sale or otherwise, or other
disposition (not including a bona fide pledge), directly or indirectly
(collectively, a "Sale"), with respect to any of the shares of Area Common
Stock to be received by such Stockholder upon the Merger (except for cash
received for fractional shares). Such Stockholder is not aware of, or
participating in, any plan or intent on the part of Cardinal stockholders (a
"Plan") to engage in sales of the Area Common Stock to be issued in the Merger
such that the aggregate fair market value, as of the effective time of the

2
62
Merger, of the shares subject to such Sales would exceed 50% of the aggregate
fair market value of all outstanding Cardinal Common Stock immediately before
the Merger (the "Outstanding Cardinal Common Stock"). A Sale of Area Common
Stock shall be considered to have occurred pursuant to a Plan if, for example,
such Sale occurs in a transaction that is in contemplation of, or related or
pursuant to, the Merger (a "Related Transaction"). In addition, shares of
Cardinal Common stock (i) with respect to which dissenter's rights are
exercised, (ii) exchanged for cash in lieu of fractional shares of Area Common
Stock, and (iii) with respect to which a Related Transaction occurs before the
Merger shall be considered to be shares of Outstanding Cardinal Common Stock
that are exchanged for shares of Area Common Stock that are disposed of
pursuant to a Plan.

3. SUCCESSORS AND ASSIGNS. A Stockholder may sell, pledge,
transfer or otherwise dispose of his or her shares of Cardinal Common Stock,
provided that such Stockholder obtains the prior written consent of Area and
that any acquirer of such Cardinal Common Stock agrees in writing to be bound
by this Affiliate Agreement.

4. TERMINATION. The parties agree and intend that this Affiliate
Agreement be a valid and binding agreement enforceable against the parties
hereto and that damages and other remedies at law for the breach of this
Agreement are inadequate. This Agreement may be terminated at any time prior
to the consummation of the Merger by the mutual written consent of the parties
hereto and shall be automatically terminated in the event that the Agreement is
terminated in accordance with its terms.

5. NOTICES. Notices may be provided to Area and the Stockholders
in the manner specified in the Agreement, with all notices to the Stockholders
being provided to them at the addresses set forth at Schedule I.

6. GOVERNING LAW. This Affiliate Agreement shall be governed by
the laws of the State of Kentucky, without giving effect to the principles of
conflicts of laws thereof.

7. COUNTERPARTS. This Affiliate Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same and
each of which shall be deemed an original.

8. HEADINGS. The Section headings contained herein are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Affiliate Agreement.

9. REGULATORY APPROVAL. If any provision of this Affiliate
Agreement requires the approval of any regulatory authority in order to be
enforceable, then such provision shall not be effective until such approval is
obtained; provided, however, that the foregoing shall not affect the
enforceability of any other provision of this Affiliate Agreement.

3
63
IN WITNESS WHEREOF, Area, by a duly authorized officer, and each of
the Stockholders have cause this Affiliate Agreement to be executed and
delivered as of the day and year first above written.

AREA BANCSHARES CORPORATION

By:
---------------------------------------
Thomas R. Brumley
President and Chief Executive Officer

STOCKHOLDERS:

- ------------------------------- ----------------------------
Samuel A. B. Boone Vernon J. Cole

- ------------------------------- ----------------------------
James M. Hill, IV Loyd G. Jasper

- ------------------------------- ----------------------------
Ryan R. Mahan John S. Penn

- ------------------------------- ----------------------------
Ronald C. Switzer Jack H. Brown

- -------------------------------
Scott P. Cvengros

4
64
SCHEDULE 1

NUMBER OF SHARES OF CARDINAL COMMON
NAME AND ADDRESS OF STOCKHOLDER STOCK BENEFICIALLY OWNED
------------------------------- ---------------------------------------

5
65
EXHIBIT 2

AREA BANCSHARES CORPORATION
AFFILIATE AGREEMENT

This AFFILIATE AGREEMENT, dated as of May 1, 1997, is entered into by
and between Area Bancshares Corporation ("Area"), a Kentucky corporation, and
each of the stockholders of Area named on Schedule I hereto (collectively, the
"Stockholders"), who are directors or affiliates of Area (for purposes of Rule
144 under the Securities Act of 1933, as amended, and for purposes of
qualifying the Merger (defined below) for "pooling-of-interests" accounting
treatment).

WHEREAS, Area and Cardinal Bancshares, Inc. ("Cardinal") have entered
into an Agreement and Plan of Merger, dated as of May 1, 1997 (the
"Agreement"), which provides for, among other things, the merger of a
subsidiary of Area with and into Cardinal, in a stock-for-stock transaction
(the "Merger").

1. OWNERSHIP OF AREA COMMON STOCK. Each Stockholder represents
and warrants that the number of shares of Area common stock ("Area Common
Stock"), set forth opposite such Stockholder's name on Schedule I hereto is the
total number of shares of Area Common Stock over which such person has
"beneficial ownership" within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended, except that the provisions of Rule
13d-3(d)(1)(i) shall be considered without any limit as to time.

2. AGREEMENTS OF THE STOCKHOLDERS. Each Stockholder covenants
and agrees that for the period beginning 30 days prior to consummation of the
Merger and ending upon the public release by Area of an earnings report to its
stockholders covering at least one month of operations after consummation of
the Merger, such Stockholder shall not sell or otherwise dispose of a number of
shares of his or her Area Common Stock (a) which is greater than 10% of his or
her total beneficial ownership of said shares as of the date of the first such
sale and (b) which in the aggregate with shares sold or otherwise disposed of
by all other Stockholders will be greater than 1% of the issued and outstanding
shares of Area as of the date of the first such sale. For purposes of this
computation, outstanding stock options that currently are exercisable would be
considered as outstanding or beneficially owned after such options are
converted to common stock equivalents using the treasury stock method in
accordance with generally accepted accounting principles.

3. TERMINATION. The parties agree and intend that this Affiliate
Agreement be a valid and binding agreement enforceable against the parties
hereto and that damages and other remedies at law for the breach of this
Affiliate Agreement are inadequate. This Affiliate Agreement may be terminated
at any time prior to the consummation of the Merger by the mutual written
consent of the parties hereto and shall be automatically terminated in the
event that the Agreement is terminated in accordance with its terms.

66
4. NOTICES. Notices may be provided to Area and the Stockholders
in the manner specified in the Agreement, with all notices to the Stockholders
being provided to them at the addresses set forth at Schedule I.

5. GOVERNING LAW. This Agreement shall be governed by the laws
of the State of Kentucky, without giving effect to the principles of conflicts
of laws thereof.

6. COUNTERPARTS. This Affiliate Agreement may be executed in one
or more counterparts, all of which shall be considered one and the same and
each of which shall be deemed as original.

7. HEADINGS. The Section headings contained herein are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Affiliate Agreement.

8. REGULATORY APPROVAL. If any provision of this Affiliate
Agreement requires the approval of any regulatory authority in order to be
enforceable, then such provision shall not be effective until such approval is
obtained; provided, however, that the foregoing shall not affect the
enforceability of any other provision of this Affiliate Agreement.

IN WITNESS WHEREOF, Area, by a duly authorized officer, and each of
the Stockholders have caused this Affiliate Agreement to be executed and
delivered as of the day and year first above written.

AREA BANCSHARES CORPORATION

By:
---------------------------------------
Thomas R. Brumley
President and Chief Executive Officer

STOCKHOLDERS:

- ---------------------------- ----------------------------
Anthony G. Bittel Allan R. Rhodes

- ---------------------------- ----------------------------
Thomas R. Brumley David W. Smith, Jr.

[Signatures Continued on Next Page]

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67

- ---------------------------- ----------------------------
C. M. Gatton William H. Thompson

- ---------------------------- ----------------------------
Gary H. Latham Pollard White

- ---------------------------- ----------------------------
Raymond C. McKinney Cy Williamson

--------------------------- ----------------------------
Don Leibee Timothy Shelburne

- ---------------------------- ----------------------------
John Ray Edward Johnson

-3-
68
SCHEDULE I

Number of Shares of Area
Name and Address of Shareholder Common Stock Beneficially Owned
- ------------------------------- -------------------------------

-4-
69
EXHIBIT 3

CLAIMS/INDEMNIFICATION LETTER

Area Bancshares Corporation
230 Frederica Street
Owensboro, Kentucky 42301

Ladies and Gentlemen:

This letter is delivered pursuant to Section 9.2(d) of the Agreement
and Plan of Merger (the "Agreement"), dated as of May 1, 1997, by and between
Area Bancshares Corporation ("Area") and Cardinal Bancshares, Inc. ("Cardinal")
which provides for the merger (the "Merger") of Area and Cardinal.

Concerning claims which I may have against Cardinal or its
wholly-owned subsidiaries (the "Cardinal Subsidiaries"), in my capacity as an
officer or director:

(a) Area shall assume all liability (to the extent
Cardinal was so liable) for claims for indemnification arising under
Cardinal's Articles of Incorporation or Bylaws or under any
indemnification contract disclosed to Area, as existing on May 1,
1997, and for claims for salaries, wages or other compensation,
employee benefits, reimbursement of expenses, or worker's compensation
arising out of employment through the effective time of the Merger;

(b) The Cardinal Subsidiaries shall retain all liability
(to the extent they were so liable) for claims for indemnification
arising under their respective Articles of Incorporation or Bylaws as
existing on May 1, 1997, and for claims for salaries, wages, or other
compensation, employee benefits, reimbursement of expenses, or
worker's compensation arising out of employment through the effective
time of the Merger;

(c) In my capacity as an officer or a director, I am not
aware that I have any claims (other than those referred to in
paragraphs (a) or (b) above) against Cardinal, or the Cardinal
Subsidiaries (other than routine deposit, loan and other banking
services conducted in the ordinary course of business with Cardinal or
the Cardinal Subsidiaries, as applicable); and

(d) I hereby release Cardinal and the Cardinal
Subsidiaries from any and all claims which I am aware that I have
against any of them in my capacity as an officer or a director, other
than those referred to in paragraphs (a) or (b) above.

By executing this letter on behalf of Area, you shall acknowledge the
assumption by Area of the liabilities described in paragraphs (a) and (b)
above, except to the extent set forth in Section 8.11 of the Merger Agreement.

70
AREA BANCSHARES CORPORATION
PAGE 2

Sincerely,

-------------------------------------------
Signature of Officer or Director

-------------------------------------------
Printed Name of Officer or Director

On behalf of Area, I hereby acknowledge receipt of this letter and
affirm the assumption by Area of the liabilities described in paragraph (a) and
(b) above, as of this _____ day of _______________, 1997.

AREA BANCSHARES CORPORATION

By:
-----------------------------------------
Thomas R. Brumley
President and Chief Executive Officer