EXHIBIT 4.12



















                                    AGREEMENT

      AGREEMENT, dated as of the 15th day of August, 2001, by and between
American Bank Incorporated (the "Holding Company"), Allentown, Pennsylvania,
and StockTrans, Inc., Ardmore, Pennsylvania, as Warrant Agent (the "Warrant
Agent").

      WHEREAS, American Bank and the Warrant Agent, entered into the attached
Warrant Agreement, dated June 15th, 2000, which provided for the preservation
of purchase rights upon the reorganization of the Bank.

      WHEREAS, American Bank intends to consummate a holding company
reorganization ("Reorganization") on or about August 31, 2001, whereby
American Bank will become a wholly owned subsidiary of American Bank
Incorporated and the shareholders and warrantholders of American Bank will
become, by operation of law, shareholders and warrantholders, respectively,
of American Bank Incorporated.

      NOW, THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration the receipt of which is
hereby acknowledged, the parties hereto agree as follows:

     1.   The Holding Company desires that the Warrant Agent act on behalf of
          the Holding Company, and the Warrant Agent is willing to act in
          connection with the issuance, division, transfer, exchange and
          exercise of Warrants.

     2.   The Holding Company and the Warrant Agent hereby adopt the terms of
          the Warrant Agreement, dated as of June 15, 2000 between American Bank
          and the Warrant Agent ("Bank Warrant Agreement").

     3.   In accordance with Section 10.4 of the Bank Warrant Agreement, the
          Holding Company hereby provides that each Holder of a Warrant of
          American Bank shall have the right after consummation of the
          Reorganization of American Bank into the holding company structure to,
          upon payment of the Warrant Exercise Price in effect immediately prior
          to such action to purchase upon exercise of each Warrant the kind and
          amount of shares and other securities and property which he would have
          owned or have been entitled to receive after the consummation of the
          Reorganization.

     4.   In order to ensure legal compliance with the Securities Act of 1933,
          the Holding Company must register its offer to sell represented by the
          Warrants with the Securities and Exchange Commission (the "SEC"). The
          Warrant Agent and the Holding Company hereby agree to temporarily
          suspend, upon consummation of the Reorganization on or about August
          31, 2001, the offer to sell represented by the Warrants until the
          registration statement is filed and declared effective by the SEC.

     5.   Upon the declaration of effectiveness of the registration statement by
          the SEC, the Holding Company will honor the Warrants upon presentment
          in accordance with their terms as offers to sell Holding Company
          common stock, and the Holding Company will notify the Warrant Agent
          and all warrantholders of record of such event in writing.

     6.   This document may be executed in counterpart.

                  ***This space left intentionally blank***





                               WARRANT AGREEMENT

     WARRANT AGREEMENT dated as of the 15th day of June, 2000 between American
Bank (the "Bank"), Allentown, Pennsylvania, and StockTrans, Inc., Ardmore,
Pennsylvania, as Warrant Agent (the "Warrant Agent").

     The Bank proposes to issue warrants hereinafter described (the "Warrants")
to purchase an aggregate maximum of up to 750,000 shares (subject to adjustment
as provided herein) of its Common Stock $2.50 par value, (the "Common Stock")
(the shares of Common Stock issuable on exercise of the Warrants being referred
to herein as the "Warrant Shares"). The Warrants are being issued in connection
with a Public Offering (the "Offering") of up to 1,500,000 shares of its Common
Stock (the "Shares"). Each Warrant entitles the holder thereof to purchase one
share (subject to adjustment as provided herein) of Common Stock.

     The Bank desires that the Warrant Agent act on behalf of the Bank, and the
Warrant Agent is willing to act in connection with the issuance, division,
transfer, exchange and exercise of Warrants.

     In consideration of the foregoing and for the purpose of defining the terms
and provisions of the Warrants and the respective rights and obligations
thereunder of the Bank and the registered owners of the Warrants (the
"Holders"), the Bank and the Warrant Agent hereby agree as follows:

SECTION 1. APPOINTMENT OF WARRANT AGENT. The Bank hereby appoints the Warrant
Agent to act as agent for the Bank in accordance with the instructions set forth
in this Agreement, and the Warrant Agent hereby accepts such appointment.

SECTION 2. TRANSFERABILITY AND FORM OF WARRANT

     2.1 REGISTRATION. The Warrants shall be represented by separate
certificates and shall be separately registered.


     2.2 TRANSFER. The Warrant Certificate is transferable (subject to
restrictions set forth in this Warrant Agreement) at the principal office of the
Warrant Agent (or successor or substitute Warrant Agent) by the registered
holder hereof in person or by his attorney duly authorized in writing, upon (i)
surrender of a Warrant Certificate, and (ii) compliance with and subject to the
conditions set forth herein and in the Warrant Agreement. A Warrant may be
transferred only upon proper presentment of a duly executed and endorsed Warrant
Certificate, and only as recorded on the Warrant register maintained by
StockTrans, Inc, as transfer agent (the "Transfer Agent")(or any successor or
substitute Transfer Agent) for the Warrants. In all cases of transfer by an
attorney, the original power of attorney, duly approved, or a copy thereof, duly
certified, shall be deposited and remain with the Warrant Agent. In case of
transfer by executors, administrators, guardians or other legal representatives,
duly authenticated evidence of their authority shall be produced, and may be
required to be




deposited and remain with the Warrant Agent in its discretion. Upon any such
transfer, a new Warrant Certificate or new Warrant Certificates of different
denominations, representing in the aggregate a like number of Warrants, will be
issued to the transferee. Until due presentation for the registration of
transfer of this Warrant Certificate on the Warrant Register certified by the
Warrant Agent, the Bank and the Warrant Agent may deem and treat the person in
whose name this Warrant Certificate is registered as the absolute and lawful
owner for all purposes whatsoever and neither the Bank nor the Warrant Agent
shall be affected by any notice to the contrary.

     2.3 FORM OF WARRANT. The Warrants shall be represented by a Warrant
Certificate, which shall be substantially as set forth in Exhibit A attached
hereto. The price per Warrant Share and the number of Warrant Shares issuable
upon exercise of each Warrant are subject to adjustment upon the occurrence of
certain events, all as hereinafter provided. The Warrants shall be executed on
behalf of the Bank by its President and attested by its Secretary or an
Assistant Secretary. The signature of any such officers on the Warrants may be
manual or facsimile.

     Warrants bearing the manual or facsimile signature of individuals who were
at any time the proper officers of the Bank shall bind the Bank, notwithstanding
that such individuals or any one of them shall have ceased to hold such offices
prior to the delivery of such Warrants or did not hold such offices on the date
of this Agreement.

     Warrants shall be dated as of the date of countersignature thereof by the
Warrant Agent either upon initial issuance or upon division, exchange,
substitution or transfer.

SECTION 3. COUNTERSIGNATURE OF WARRANTS. The Warrants shall be countersigned by
the Warrant Agent (or any successor to the Warrant Agent then acting as warrant
agent under this Agreement) and shall not be valid for any purpose unless so
countersigned by the Warrant Agent (or by its successor as warrant agent
hereunder) and may be delivered by the Warrant Agent, notwithstanding that the
persons whose manual or facsimile signatures appear thereon as proper officers
of the Bank shall have ceased to be such officers at the time of such
countersignature issuance or delivery. The Warrant Agent shall, upon written
instructions of the President or the Secretary of the Bank, countersign, issue
and deliver Warrants entitling the Holders thereof to purchase not more than
750,000 Warrant Shares (subject to Section 7 hereof and adjustment pursuant to
Section 10 hereof) and shall countersign and deliver Warrants as otherwise
provided in this Agreement.

SECTION 4. EXCHANGE OF WARRANT CERTIFICATES. Each Warrant Certificate may be
exchanged for another Warrant Certificate or Certificates entitling the Holder
thereof to purchase a like aggregate number of Warrant Shares as the certificate
or certificates surrendered then entitle such Holder to purchase. Any Holder
desiring to exchange a Warrant Certificate or Certificates shall make such
request in writing delivered to the Warrant Agent, and shall surrender, properly
endorsed, the Warrant Certificate or Certificates to be so exchanged. Thereupon,
the Warrant Agent shall countersign and deliver to the person entitled thereto a
new Warrant Certificate or Certificates, as the case may be, as so requested.

                                       2




SECTION 5. TERMS AND EXERCISE OF WARRANTS.

     5.1 TERM OF WARRANTS. Subject to the terms of this Agreement, each Holder
shall have the right, which may be exercised at any time until June 30, 2003
(the "Expiration Date"), to purchase from the Bank the number of Warrant Shares
which the Holder may at the time be entitled to purchase on exercise of such
Warrants.

     5.2 EXERCISE OF WARRANTS. Warrants may only be exercised for the purchase
of whole Warrant Shares. Warrants may be exercised upon surrender to the Bank at
the principal office of the Warrant Agent, of the Warrant Certificate or
Certificates evidencing the Warrants to be exercised (except as otherwise
provided below), together with the form of election to purchase on the reverse
thereof duly and properly filled in, signed with signature guaranteed by a
member of a national signature guarantee medallion program in the case of a
request for issues of warrant shares to a person or entity other than the
registered holder of the surrendered Warrant Certificates, and upon payment to
the Warrant Agent for the account of the Bank of the Warrant Exercise Price (as
defined in and determined in accordance with the provisions of Sections 9 and 10
hereof, and of this Section 5), for the number of Warrant Shares in respect of
which such Warrants are then exercised. Payment of the aggregate Warrant
Exercise Price shall be made by certified or official bank check.

     Subject to Section 6 hereof, upon such surrender of Warrant Certificates
and payment of the Warrant Exercise Price as aforesaid, the Warrant Agent shall
issue and cause to be delivered as soon as is reasonably possible after payment
for said Warrant Shares has been declared irrevocably collected by the bank in
which said payment of the Warrant Exercise price has been deposited, and in such
name or names as the Holder may designate, a certificate or certificates for the
number of full Warrant Shares so purchased upon the exercise of such Warrants,
together with cash, as provided in Section 12 hereof, in respect of any
fractional Warrant Share otherwise issuable upon such exercise of Warrants. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have, become a holder of
record of such Warrant Shares as of the date of the surrender of such Warrant
Certificate and payment of the Warrant Price, as aforesaid; provided however,
that if, at the date of surrender of such Warrants and payment of such Warrant
Exercise Price, the transfer books for the Warrant Shares or other class of
stock purchasable upon the exercise of such Warrants shall be closed, the
certificates for the Warrant Shares in respect of which such Warrants are then
exercised shall be issuable as of the date on which such books shall next be
opened (whether before or after the Expiration Date) and until such date the
Warrant Agent shall be under no duty to deliver any certificate for such Warrant
Shares; provided further, however, that the transfer books of record unless
otherwise required by law, shall not be closed at any one time for a period
longer than twenty days. The rights of purchase represented by the Warrants
shall be exercisable, at the election of the Holder thereof, either in full or
from time to time in part and, in the event that a certificate evidencing
Warrants is exercised in respect of less than all of the Warrant Shares
purchasable on such exercise at any time prior to the date of expiration of the
Warrants, a new Warrant certificate evidencing the remaining Warrant or Warrants
will be issued.

                                       3



     5.3 ACCELERATION BY THE BANK. The Bank shall not have the right to
accelerate the Expiration Date.

SECTION 6. PAYMENT OF TAXES. The Bank will pay all documentary stamp taxes, if
any, attributable to the initial issuance of Warrant Shares upon the exercise of
Warrants; provided however, that the Bank shall not be required to pay any tax
or taxes which may be payable in respect of any transfer involved in the issue
or delivery of any Warrant Certificate or Certificates for Warrant Shares in a
name other than that of the registered Holder of Warrants in respect of which
such Warrant Shares are issued.

SECTION 7. MUTILATED OR MISSING WARRANT CERTIFICATE. In case any of the
certificates evidencing the Warrants shall be mutilated, lost, stolen or
destroyed, the Bank may in its discretion issue, and the Warrant Agent shall
countersign and deliver in exchange and substitution for and upon cancellation
of the mutilated Warrant Certificate, or in lieu of and substitution for the
Warrant Certificates if lost, stolen or destroyed, a new Warrant Certificate of
like tenor and representing an equivalent right or interest; but only upon
receipt of evidence satisfactory to the Bank and the Warrant Agent of such loss,
theft or destruction of such Warrant and indemnity, if requested, also
satisfactory to them. An applicant for such a substitute Warrant Certificate
shall also comply with such other reasonable requirements and pay such other
reasonable charges as the Bank or the Warrant Agent may prescribe.

SECTION 8. RESERVATION OF WARRANT SHARES; PURCHASE OF WARRANTS

     8.1 RESERVATION OF WARRANT SHARES. There have been reserved, and the Bank
shall at all times keep reserved, out of its authorized and unissued Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the rights of purchase represented by the outstanding Warrants. The Transfer
Agent for the Common Stock and every subsequent transfer agent for any shares of
the Bank's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be requisite for such purpose.
The Bank will keep a copy of this Agreement on file with the Transfer Agent or
its successors and with every subsequent transfer agent for any shares of the
Bank's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants.

     The Warrant Agent is hereby irrevocably authorized to requisition from time
to time from the Transfer Agent or its successors the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance with
the terms of this Agreement. The Bank will supply such Transfer Agent or its
successors with duly executed stock certificates for such purposes and will
provide or otherwise make available any cash which may be payable as provided in
Section 12 thereof. All Warrant Certificates surrendered in the exercise. of the
rights thereby evidenced shall be canceled by the Warrant Agent and shall
thereafter be delivered to the Bank.

                                       4




     8.2. PURCHASE OF WARRANTS BY THE BANK. The Bank shall have the right,
except as limited by law, other agreement or herein, to purchase or otherwise
acquire Warrants at such times, in such manner and for such consideration as it
may deem appropriate.

     8.3. CANCELLATION OF WARRANTS. In the event the Bank shall purchase or
otherwise acquire Warrants, the same shall thereupon be delivered to the Warrant
Agent and be canceled by it and retired. The Warrant Agent shall cancel any
Warrants surrendered for exchange, substitution, transfer or exercise in whole
or in part.

SECTION 9. WARRANT PRICE. The price per share at which Warrant Shares shall be
purchasable upon exercise of Warrants (the "Warrant Exercise Price") shall be
$10.00, subject to adjustment pursuant to Section 10 hereof.

SECTION 10. ADJUSTMENT OF WARRANT PRICE AND NUMBER OF WARRANT SHARES. The number
and kind of securities purchasable upon the exercise of each Warrant and the
Warrant Exercise Price shall be subject to adjustment from time to time upon the
happening of certain events, as hereinafter defined.

     10.1 MECHANICAL ADJUSTMENTS. The number of Warrant Shares purchasable upon
the exercise of each Warrant and the Warrant Exercise Price shall be subject to
adjustment as follows:

     (a) In case the Bank shall (i) pay a dividend in shares of Common Stock or
make a distribution in shares of Common Stock, (ii) subdivide or "split" its
outstanding shares of Common Stock, (iii) combine its outstanding shares of
Common Stock into a smaller number of shares of Common stock or (iv) issue by
reclassification or recapitalization of its shares of Common Stock other
securities of the Bank, the Holder of the Warrant shall be entitled to purchase
the number of Warrant Shares or other securities of the Bank which he would have
been able to purchase after the happening of any of the events described above,
had such Warrant been exercised immediately prior to the happening of such event
or any record date with respect thereto. An adjustment made pursuant to this
paragraph (a) shall become effective immediately after the effective date of
such event retroactive to the record date, if any, for such event.

     (b) In case the Bank shall distribute to all holders of its shares of
Common Stock evidences of its indebtedness or assets (excluding cash dividends
or distributions payable out of consolidated earnings or earned surplus and
dividends or distributions referred to in paragraph (a) above) or rights,
options or warrants or convertible or exchangeable securities containing the
right to subscribe for or purchase shares of Common Stock, then in each case the
number of Warrant Shares thereafter purchasable upon the exercise of each
Warrant shall be determined by multiplying the number of Warrant Shares
purchasable upon the exercise of each Warrant before the occurrence of such
event, by a fraction, of which the numerator shall be the then current market
price per share of Common Stock (as defined in paragraph (c) below) on the date
of such distribution, and of which the denominator shall be the then current
market price per share of Common Stock, less the then fair value (as determined
by the Board of Directors of the Bank, whose determination shall be conclusive)
of the portion of the assets or evidences of indebtedness so distributed or of
such subscription rights, options or warrants, or of such convertible or
exchangeable

                                       5



securities applicable to one share of Common Stock. Such adjustment shall be
made whenever any such distribution is made, and shall become effective on the
date of distribution retroactive to the record date for the determination of
shareholders entitled to receive such distribution.

     (c) For the purpose of any computation under paragraph (b) of this Section
and Section 12, the current market price per share of Common Stock at any date
shall be the average representative closing bid quotation as reported on OTC
Bulletin Board or the Nasdaq or, in the event the Common Stock is listed on a
securities exchange, the average closing sales price on the principal such
exchange for the Common Stock for the five consecutive trading days ending the
day prior to the date as of which such computation is made. In the event that
none of the above sources are available, the Board of Directors of the Bank
shall determine the current market price based upon such information and
evidence as they determine to be credible and relevant at the time.

     (d) No adjustment in the number of Warrant Shares purchasable hereunder
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the number of Warrant Shares purchasable upon the exercise of
each Warrant; provided, however, that any adjustments which by reason of this
paragraph (d) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations shall be made to the
nearest one-thousandth of a share.

     (e) Whenever the number of Warrant Shares purchasable upon the exercise of
each Warrant is adjusted, as herein provided, the Warrant Exercise Price payable
upon exercise of each Warrant shall be adjusted by multiplying such Warrant
Exercise Price immediately prior to such adjustment by a fraction, of which the
numerator shall be the number of Warrant Shares purchasable upon the exercise of
each Warrant immediately prior to such adjustment, and of which the denominator
shall be the number of Warrant Shares so purchasable immediately thereafter.

     (f) For the purpose of this subsection 10.1, the term "shares of Common
Stock" shall mean (i) the class of stock designated as the Common Stock of the
Bank at the date of this Agreement, or (ii) any other class of stock resulting
from successive changes or reclassification of such shares consisting solely of
changes in par value, or from par value to no par value, or from no par value to
par value. In the event that at any time, as a result of an adjustment made
pursuant to paragraph (a) above, the Holders shall become entitled to purchase
any shares of the Bank other than shares of Common Stock, thereafter the number
of such other shares so purchasable upon exercise of each Warrant and the
Warrant Exercise Price of such shares shall be subject to adjustment from time
to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Warrant Shares contained in paragraphs (a)
through (e), inclusive, above, and the provisions of Section 5 and subsections
10.2 and 10.3 with respect to the Warrant Shares, shall apply on like terms to
any such other shares.

     10.2 NOTICE OF ADJUSTMENT. Whenever the number of Warrant Shares
purchasable upon the exercise of each Warrant or the Warrant Exercise Price of
such Warrant Shares is adjusted, as herein provided, the Bank shall cause the
Warrant Agent promptly to mail by first class mail, postage prepaid, to each
Holder notice of such

                                       6



adjustment or adjustments and shall deliver to the Warrant Agent a certificate
setting forth the number of Warrant Shares purchasable upon the exercise of each
Warrant and the Warrant Exercise Price of such Warrant Shares after such
adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which the Warrant Agent shall be
entitled to rely on such certificate and it shall be under no duty or
responsibility with respect to any such certificate, except to exhibit the same,
from time to time, to any Holder desiring an inspection thereof during
reasonable business hours. The Warrant Agent shall not at any time be under any
duty or responsibility to any Holders to determine whether any facts exist which
may require any adjustment of the Warrant Exercise Price or the number of
Warrant Shares or other stock or property purchasable on exercise thereof, or
with respect to the method employed in making such adjustment.

     10.3 NO ADJUSTMENT FOR DIVIDENDS. Except as provided in subsection 10.1, no
adjustment in respect of any dividend shall be made during the term of a Warrant
or upon the exercise of a Warrant.

     10.4 PRESERVATION OF PURCHASE RIGHTS UPON CONSOLIDATION, ETC. In case of
any consolidation of the Bank with or merger of the Bank into another
corporation, the Bank or such successor or purchasing corporation, as the case
may be, shall execute with the Warrant Agent an agreement providing that each
Holder shall have the right thereafter upon payment of the Warrant Exercise
Price in effect immediately prior to such action to purchase upon exercise of
each Warrant the kind and amount of shares and other securities and property
which he would have owned or have been entitled to receive after the happening
of such consolidation, merger, sale or conveyance had such Warrant been
exercised immediately prior to such action. The Bank shall mail by first class
mail, postage prepaid, to each Holder, notice of the execution of any such
agreement. Such agreement shall provide for adjustments, which shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section 10.

     10.5 STATEMENT ON WARRANTS. Irrespective of any adjustments in the Warrant
Exercise Price or the number or kind of shares purchasable upon the exercise of
the Warrants, Warrant Certificates theretofore or thereafter issued may continue
to express the same price and number and kind of shares as are stated in the
Warrant Certificates initially issuable pursuant to this Agreement.

SECTION 11. EXPIRATION OF WARRANTS. On the Expiration Date, all outstanding
Warrants shall become void and all rights of all holders thereof and thereunder
and under this Agreement shall cease.

SECTION 12. FRACTIONAL INTERESTS. The Bank shall not be required to issue
fractional Warrant Shares on the exercise of Warrants. The number of full
Warrant Shares which shall be issuable upon the exercise of Warrants shall be
computed on the basis of the aggregate number of Warrant Shares purchasable on
exercise of the Warrant so presented. If any fraction of Warrant Share would, as
a result of any adjustment in accordance with Section 10 thereof, except for the
provisions of this Section 12, be issuable on the exercise of any Warrant (or
specified portion thereof), the Bank shall pay an amount in cash equal to the
then current market price per Warrant Share (as defined in Section 10. 1 (c)
above)

                                       7



multiplied by such fraction; in any other event, cash in lieu of fractional
Warrant shares shall not be payable.

SECTION 13. NO RIGHTS AS SHAREHOLDERS; NOTICES TO HOLDERS. Notices contained in
this Agreement or in any of the Warrants shall not be construed as conferring
upon the Holders or their transferees (i) the right to vote for the election of
directors of the Bank or for any other matter; or (ii) to receive dividends or
any rights whatsoever as shareholders of the Bank.

SECTION 14. DISPOSITION OF PROCEEDS ON EXERCISE OF WARRANTS; INSPECTION OF
WARRANT AGREEMENT. The Warrant Agent shall account promptly to the Bank with
respect to Warrants exercised and concurrently pay to the Bank all monies
received by the Warrant Agent for the purchase of the Warrant, Shares through
the exercise of such Warrants.

     The Warrant Agent shall keep copies of this Agreement and any notices given
or received hereunder available for inspection by the Holders during normal
business hours at its principal office. The Bank shall supply the Warrant Agent
from time to time with such numbers of copies of this Agreement as the Warrant
Agent may request.

SECTION 15. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT. Any
corporation into which the Warrant Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which the Warrant Agent shall be a party, shall be the successor to the Warrant
Agent hereunder without the execution or filing of any paper or any further act
on the part of any of the parties hereto, provided that such corporation would
be eligible for appointment as a successor Warrant Agent under Section 17
hereof. In case at the time such successor to the Warrant Agent shall succeed to
the agency created by this Agreement, any of the Warrants shall have been
countersigned but not delivered, any such successor to the Warrant Agent may
adopt the countersignature of the original Warrant Agent and deliver such
Warrants so countersigned; and in case at that time any of the Warrants shall
not have been countersigned, any successor to the Warrant Agent may countersign
such Warrants either in the name of the predecessor Warrant Agent or in the name
of the successor Warrant Agent; and in all such cases Warrants shall have the
full force provided in the Warrants and in this Agreement.

     In case at any time the name of the Warrant Agent shall be changed and at
such time any of the Warrants shall have been countersigned but not delivered,
the Warrant Agent may adopt the countersignatures under its prior name and
deliver such Warrants so countersigned; and in case at the time any of the
Warrants shall not have been countersigned, the Warrant Agent may countersign
such Warrants either in its prior name or in its changed name; and in all such
cases such Warrants shall have the full force provided in the Warrants and in
this Agreement.

SECTION 16. CONCERNING THE WARRANT AGENT. The Warrant Agent acts hereunder as
agent and in a ministerial capacity for the Bank, and its duties shall be
determined solely by the provisions hereof. The Warrant Agent shall not, by
issuing and delivering Warrant Certificates representing the Warrants or by any
other act hereunder, be deemed to make


                                       8




any representations as to the validity, value or authorization of the Warrant
Certificates or the Warrants represented thereby or of any securities or other
property delivered upon exercise of any Warrant or whether any stock issued upon
exercise of any Warrant is fully paid and non-assessable.

     The Warrant Agent shall not at any time be under any duty or responsibility
to any Holder of Warrants to make or cause to be made any adjustment of the
Exercise Price provided in this Agreement, or to determine whether any fact
exists which may require any such adjustment, or with respect to the nature or
extent of any such adjustment, when made, or with respect to the method employed
in making the same. The Warrant Agent shall not (i) be liable for any recital or
statement of facts contained herein or for any action taken, suffered or omitted
by it in reliance on any Warrant Certificate or other document or instrument
believed by it in good faith to be genuine and to have been signed or presented
by the proper party or parties, (ii) be responsible for any failure on the part
of the Bank to comply with any of its covenants and obligations contained in
this Agreement or in any Warrant Certificate, or (iii) be liable for any act or
omission in connection with this Agreement except for its own gross negligence
or willful misconduct.

     16.1 CORRECTNESS OF STATEMENTS. The statements contained herein and in the
Warrants shall be taken as statements of the Bank, and the Warrant Agent assumes
no responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken by it. The Warrant Agent assumes no
responsibility with respect to the distribution of the Warrants except as herein
otherwise provided.

     16.2 BREACH OF COVENANTS. The Warrant Agent shall not be responsible for
any failure of the Bank to comply with the covenants contained in this Agreement
or to comply with the terms and conditions contained in the Warrants.

     16.3 RELIANCE ON COUNSEL. The Warrant Agent may consult with legal counsel
satisfactory to it (who may be counsel for the Bank) and the Warrant Agent shall
incur no liability or responsibility in respect of any action taken, suffered or
committed by it hereunder in good faith and in accordance with the opinion or
the advice of such counsel.

     16.4 PROOF OF ACTIONS TAKEN. Whenever in the performance of its duties
under this Agreement the Warrant Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Bank prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed conclusively to
be proved and established by a certificate signed by the President and one of
its Senior Vice Presidents, the Treasurer or the Secretary of the Bank and
delivered to the Warrant Agent; and such certificate shall be full authorization
to the Warrant Agent for any action taken or suffered in good faith by it under
the provisions of this Agreement in reliance upon such certificate.

     16.5 COMPENSATION. The Bank agrees to pay the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent and to reimburse the
Warrant Agent for all expenses, taxes and governmental charges and other charges
of any kind and nature incurred by the Warrant Agent in the performance of its
duties under this Agreement, and to indemnify the Warrant Agent and save it
harmless against any and all


                                       9



liabilities, including judgments, costs and counsel fees, for any thing done or
omitted by the Warrant Agent in the performance of its duties under this
Agreement except as a result of the Warrant Agent's gross negligence or willful
misconduct.

     16.6 LEGAL PROCEEDINGS. The Warrant Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any other action
likely to involve expense unless the Bank or one or more Holders shall furnish
the Warrant Agent with reasonable security and indemnity for any costs and
expenses which may be incurred by it, but this provision shall not affect the
power of the Warrant Agent to take such action as the Warrant Agent may consider
proper, whether with or without any security or indemnity. All rights of action
under this Agreement or under any of the Warrants may be enforced by the Warrant
Agent without the possession of any of the Warrants or the production thereof at
any trial or other proceeding relative thereto, and any such action, suit or
proceeding instituted by the Warrant Agent shall be brought in its name as
Warrant Agent, and any recovery of judgment shall be for the ratable benefit of
the Holders, as their respective rights or interests may appear.

     16.7 OTHER TRANSACTIONS IN SECURITIES OF BANK. Consistent with its or their
fiduciary obligations to the Bank hereunder, the Warrant Agent and any
shareholder, director, officer or employee of the Warrant Agent may buy, sell or
deal in any of the Warrants or Shares, or other securities of the Bank or become
pecuniarily interested in any transaction in which the Bank may be interested,
or contract with the Bank or otherwise act as fully and freely as though it were
not Warrant Agent under this Agreement. Nothing herein shall preclude the
Warrant Agent from acting in any other capacity for the Bank or for any other
legal entity.

     16.8 LIABILITY OF WARRANT AGENT. The Warrant Agent shall act hereunder
solely as agent. The Warrant Agent shall not be liable for anything which it may
do or refrain from doing in connection with this Agreement except for such acts
or omissions arising out of its own gross negligence or willful misconduct.

     16.9 RELIANCE ON DOCUMENTS. The Warrant Agent will not incur any liability
or responsibility to the Bank or to any Holder for any action taken in reliance
on any notice, resolution, waiver, consent, order, certificate, or other paper,
document or instrument reasonably believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties.

     16.10 VALIDITY OF AGREEMENT, ETC. The Warrant Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Warrant Agent) or in
respect of the validity or execution of any Warrant (except its countersignature
thereof) or in respect of the necessity or the extent of any adjustment to the
Warrant Exercise Price or the number of Warrant Shares purchasable under a
Warrant; nor shall the Warrant Agent by any act hereunder be deemed to make any
representation or warranty as to the authorization, reservation, value or
registration under securities laws of any Warrant Shares (or other stock) to be
issued pursuant to this Agreement or any securities laws of any Warrant Shares
(or other stock) to be issued pursuant to this Agreement or any Warrant, or as
to whether any Warrant Shares (or other stock) will, when issued, be validly
issued, fully paid and


                                       10




non-assessable, or as to the Warrant Exercise Price or the number or amount of
Warrant Shares or other securities or other property issuable upon exercise of
any Warrant or the method employed in making any adjustment to the foregoing.

     16.11 WARRANT AGENT'S INDEMNITY. The Bank shall indemnify and hold harmless
the Warrant Agent and its employees, from and against any loss, damage,
expenses, liability or claim suffered, incurred by, or asserted against it or
them, including judgments, expenses of legal counsel arising out of, in
connection with or based upon any act or omission by it or them relating in any
way to this Agreement or its services hereunder, except losses, expenses and
liabilities arising as a result of the Warrant Agent's gross negligence and
willful misconduct.

     16.12 INSTRUCTIONS FROM BANK. The Warrant Agent is hereby authorized and
directed to accept instructions with respect to the performance of its duties
hereunder from the Chairman of the Board, the President, any Senior Vice
President, the Secretary or the Treasurer of the Bank for advice or instructions
in connection with its duties, and shall not be liable for any action reasonably
taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer or officers, provided that such instructions
are not in obvious conflict with the terms and conditions of this Agreement.

SECTION 17. CHANGE OF WARRANT AGENT. The Warrant Agent may resign and be
discharged from its duties under this Agreement by giving to the Bank thirty
days' notice in writing. The Warrant Agent may be removed by like notice to the
Warrant Agent from the Bank. If the Warrant Agent shall resign or be removed or
shall otherwise become incapable of acting, the Bank shall appoint a successor
to the Warrant Agent. If the Bank shall fail to make such appointment within a
period of thirty days after written notice of such removal, resignation or
incapacity has been sent by the resigned or incapacitated Warrant Agent, or by
the Bank or by any Holder (who shall with such notice submit his Warrant for
inspection by the Bank), then any Holder may apply to any court of competent
jurisdiction for the appointment of a successor to the Warrant Agent. Any
successor warrant agent, whether appointed by the Bank or such a court, shall be
a bank or trust company, in good standing, incorporated under the laws of the
United States of America or any state thereof and having at the time of its
appointment as warrant agent a combined capital and surplus of at least
$5,000,000, or a stock transfer company. After appointment, the successor
warrant agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the former Warrant Agent shall deliver and transfer to
the successor warrant agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Failure to file any notice provided for in this Section 17,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Warrant Agent or the appointment of the successor
warrant agent, as the case may be. In the event of such resignation or removal
the Bank shall notify promptly the Warrant Agent of such removal or resignation
and the name and address of such successor warrant agent.

SECTION 18. IDENTITY OF TRANSFER AGENT. Forthwith upon the appointment of any
subsequent transfer agent for the Common Stock, or any other shares of the
Bank's capital


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stock issuable upon the exercise of the Warrants, the Bank will file with the
Warrant Agent a statement setting forth the name and address of such subsequent
transfer agent.

SECTION 19. NOTICES. Any notice pursuant to this Agreement by the Bank, or by
any Holder to the Warrant Agent, or by the Warrant Agent or by any Holder to the
Bank, shall be in writing and shall be mailed first class, postage prepaid, or
delivered (a) to the Bank, to American Bank 4029 West Tilghman Street,
Allentown, Pennsylvania 18104, and (b) Warrant Agent, to StockTrans, Inc., 7
East Lancaster Avenue, Ardmore, Pennsylvania 19003. Each party hereto may from
time to time change the address to which notices to it are to be delivered or
mailed hereunder by notice in writing to the other party.

     Any notice mailed pursuant to this Agreement by the Bank or the Warrant
Agent to the Holders shall be in writing and shall be mailed first class,
postage prepaid, or delivered to such Holders at their respective addresses on
the books of the Warrant Agent.

SECTION 20. SUPPLEMENTS AND AMENDMENTS. The Bank and the Warrant Agent may from
time to time by agreement supplement or amend this Agreement, without the
approval of any Holder in order to cure any ambiguity or to correct or
supplement any provision herein, or to make any other provisions in regard to
matters or questions arising hereunder which the Bank and the Warrant Agent may
deem necessary or desirable and which shall not be inconsistent with the
provisions of the Warrants and which shall not adversely affect the interests of
the Holders.

SECTION 21. SUCCESSORS. All the covenants and provisions of this Agreement by or
for the benefit of the Bank or the Warrant Agent shall bind and inure to the
benefit of their respective successors and assigns hereunder.

SECTION 22. MERGER OR CONSOLIDATION OF THE BANK. The Bank will not merge or
consolidate with or into any other corporation unless the corporation resulting
from such merger or consolidation (if not the Bank) shall expressly assume, by
supplemental agreement satisfactory in form to the Warrant Agent, the due and
punctual performance and observance of each and every covenant and condition of
this Agreement to be performed and observed by the Bank.

SECTION 23. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance ,with the laws of the State of Pennsylvania.

SECTION 24. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give any person or corporation other than the Bank, the Warrant
Agent, and the Holders any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole and exclusive benefit of the
Bank, the Warrant Agent and the Holders of the Warrants.

SECTION 25. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.

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SECTION 26. CAPTIONS. The captions of the Sections and the subsections of this
Agreement have been inserted for convenience only and shall have no substantive
effect.

     In Witness Whereof, the parties have caused this Agreement to be duly
executed, all as of the day and year first above written.


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