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                                                                    EXHIBIT 10.4

                              EMPLOYMENT AGREEMENT


     This AGREEMENT (the "Agreement") is made as of September 19, 2001 (the
"Effective Date"), by and between Strata Bank, a bank chartered under the laws
of Massachusetts with its headquarters located in Medway, Massachusetts (the
"Employer"), Service Bancorp, MHC, a corporation chartered under the laws of
Massachusetts, and Service Bancorp, Inc., a corporation chartered under the laws
of Massachusetts (the "Holding Companies") and Pamela J. Montpelier (the
"Executive").  In consideration of the mutual covenants contained in this
Agreement, the Employer, the Holding Companies and the Executive agree as
follows:

                                   WITNESSETH

     WHEREAS, the Executive is currently employed as President and Chief
Executive Officer of the Employer; and

     WHEREAS, the Executive also serves as President and Chief Executive Officer
of the Holding Companies, both of which are parent companies of the Employer;
and

     WHEREAS, the Employer and the Holding Companies desire to retain the
Executive in those positions, in accordance with the terms of a formal, written
Employment Agreement.

     NOW, THEREFORE, the Employer, the Holding Companies and the Executive
hereby agree as follows:

     1.  Employment.  The Employer agrees to employ the Executive and the
Executive agrees to be employed by the Employer on the terms and conditions set
forth in this Agreement.

     2.  Capacity.  The Executive currently serves and shall continue to serve
during the Term (as defined below) the Employer as President and Chief Executive
Officer and Chairman of the Board of Directors of the Employer (the "Board of
Directors").  The Executive confirms that she also currently serves and shall
continue to serve during the Term both Holding Companies as President and Chief
Executive Officer.  During the Term, the Executive shall also serve the Employer
and the Holding Companies in such other or additional senior executive offices
as the Executive may be requested to serve by the Board of Directors or the
respective Boards of Directors of the Holding Companies, provided that such
additional offices would not result in any condition described in Section
6(d)(i)-(iv) hereof.  In such capacity or capacities, the Executive shall
perform such services and duties in connection with the business, affairs and
operations of the Employer and the Holding Companies as may be assigned or
delegated to the Executive from time to time by or under the authority of the
Board of Directors or the respective Boards of Directors of the Holding
Companies consistent with the terms of this Agreement.

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     3.  Term.  Subject to the provisions of Section 6, the term of employment
pursuant to this Agreement (the "Term") shall be three (3) years from the
Effective Date and shall be extended automatically for periods of one (1) year
commencing at the second anniversary of the Effective Date and on each
subsequent anniversary thereafter, unless either the Executive or the Employer
gives written notice to the other not less than thirty (30) days prior to the
date of any such anniversary of such party's election not to extend the Term.
If the Employer gives such notice then, notwithstanding the preceding sentence,
the Executive shall be entitled at her option and upon ninety (90) days prior
written notice to the Employer to receive Termination Benefits (as defined in
Section 6(e)) as if the Executive's employment were being terminated pursuant to
Section 6(c) or 6(d) hereof.

     4.  Compensation and Benefits.  The regular compensation and benefits
payable to the Executive under this Agreement shall be as follows:

          (a) Salary.  For all services rendered by the Executive under this
     Agreement, the Employer shall initially pay the Executive a salary (the
     "Salary") at the annual rate of One Hundred Sixty Thousand Dollars
     ($160,000).  The Salary shall be reviewed annually by the Board of
     Directors or the Compensation Committee of the Board of Directors (the
     "Compensation Committee").  Based upon such review, the Salary shall be
     increased by the greater of (i) the average percentage increase for all
     employees of the Employer generally; or (ii) the amount necessary to
     maintain the Salary within the range of salaries for Chief Executive
     Officers of peer banks of the Employer, based upon a salary survey
     performed by a reputable salary consultant experienced in the community
     banking industry.  The Salary shall be payable in periodic installments in
     accordance with the Employer's usual practice for its senior executives.

          (b) Bonus.  The Executive shall be entitled to participate in any
     incentive programs generally available to senior executives of the Employer
     that may be established by the Board of Directors or the Compensation
     Committee with such terms as may be established in the sole discretion of
     the Board of Directors or Compensation Committee.

          (c) Regular Benefits.  The Executive shall also be entitled to
     participate in any employee benefit plans, medical insurance plans, life
     insurance plans, disability income plans, retirement plans, vacation plans,
     expense reimbursement plans and other benefit plans which the Employer may
     from time to time have in effect for all or most of its senior executives.
     Such participation shall be subject to the terms of the applicable plan
     documents, generally applicable policies of the Employer, applicable law
     and the discretion of the Board of Directors, the Compensation Committee or
     any administrative or other committee provided for in or contemplated by
     any such plan.  Nothing contained in this Agreement shall be construed to
     create any obligation on the part of the Employer to establish any such
     plan or to maintain the effectiveness of any such plan which may be in
     effect from time to time.

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          (d) Automobile.  The Employer shall provide the Executive with an
     automobile allowance each month during the Term, or equivalent arrangement
     satisfactory to the Executive, in an amount sufficient to make an owned or
     leased vehicle of a class appropriate and customary for chief executive
     officers of comparable banks available for use by the Executive, and in
     addition shall be responsible for and pay (directly or by reimbursing the
     Executive) all associated costs and expenses including, without limitation,
     insurance premiums, registration fees, taxes, and other costs and expenses
     associated with operation and maintenance of the vehicle.

          (e) Life Insurance.  During the Term of this Agreement, the Executive
     shall be entitled to purchase term life insurance on terms and in an amount
     of her choice at the Employer's expense which shall not exceed $1,000
     annually.

          (f) Taxation of Payments and Benefits.  The Employer shall undertake
     to make deductions, withholdings and tax reports with respect to payments
     and benefits under this Agreement to the extent that it reasonably and in
     good faith believes that it is required to make such deductions,
     withholdings and tax reports.  Payments under this Agreement shall be in
     amounts net of any such deductions or withholdings.  Nothing in this
     Agreement shall be construed to require the Employer to make any payments
     to compensate the Executive for any adverse tax effect associated with any
     payments or benefits or for any deduction or withholding from any payment
     or benefit.

          (g) Exclusivity of Salary and Benefits.  The Executive shall not be
     entitled to any payments or benefits in addition to those provided under
     this Agreement unless otherwise determined by the Board of Directors.

     5.  Extent of Service.  During the Executive's employment under this
Agreement, the Executive shall, subject to the direction and supervision of the
Board of Directors, devote the Executive's full business time, best efforts and
business judgment, skill and knowledge to the advancement of the Employer's and
the Holding Companies' interests and to the discharge of the Executive's duties
and responsibilities under this Agreement.  The Executive shall not engage in
any other business activity, except as may be approved by the Board of
Directors;  provided that nothing in this Agreement shall be construed as
preventing the Executive from:

          (a) investing the Executive's assets in a manner not prohibited by
     Section 7(d) and in such form or manner as shall not impair Executive's
     performance of her duties and responsibilities under this Agreement; or

          (b) engaging in religious, charitable or other community or non-profit
     activities that do not impair the Executive's ability to fulfill the
     Executive's duties and responsibilities under this Agreement.

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     6.  Termination and Termination Benefits.  Notwithstanding the provisions
of Section 3, the Executive's employment under this Agreement shall terminate
under the following circumstances set forth in this Section 6.

          (a) Termination by the Employer for Cause.  The Executive's employment
     under this Agreement may be terminated for cause without further liability
     on the part of the Employer effective immediately upon a vote of the Board
     of Directors and written notice to the Executive.  Only the following shall
     constitute "cause" for such termination:

               (i) dishonest statements or acts of the Executive concerning
          material matters relating to the Employer or any affiliate of the
          Employer; including, but not limited to, the Holding Companies;

               (ii) the commission by or indictment of the Executive for (A) a
          felony or (B) any misdemeanor involving moral turpitude, deceit,
          dishonesty or fraud ("indictment," for these purposes, meaning an
          indictment, probable cause hearing or any other procedure pursuant to
          which an initial determination of probable or reasonable cause with
          respect to such offense is made);

               (iii)  failure to perform to the reasonable satisfaction of the
          Board of Directors a substantial portion of the Executive's duties and
          responsibilities assigned or delegated under this Agreement, which
          failure continues, in the reasonable judgment of the Board of
          Directors, after written notice given to the Executive by the Board of
          Directors;

               (iv) gross negligence, willful misconduct or insubordination of
          the Executive with respect to the Employer or any affiliate of the
          Employer, including, but not limited to, the Holding Companies; or

               (v) material breach by the Executive of any of the Executive's
          obligations under this Agreement.

          (b) Termination by the Executive.  The Executive's employment under
     this Agreement may be terminated by the Executive by written notice to the
     Board of Directors at least sixty (60) days prior to such termination.

          (c) Termination by the Employer Without Cause.  Subject to the payment
     of Termination Benefits pursuant to Section 6(e), the Executive's
     employment under this Agreement may be terminated by the Employer without
     cause upon written notice to the Executive by a vote of the Board of
     Directors.

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          (d) Termination by the Executive for Good Reason.  The Executive's
     employment under this Agreement may be terminated by the Executive for a
     "good reason."  For purposes of this Section 6(d), the Executive shall be
     deemed to have a "good reason" to voluntarily terminate his employment with
     the Employer if one of the following conditions occurs without the
     Executive's consent, the Executive notifies the Employer in writing of the
     occurrence of one of these conditions within thirty (30) days of its onset,
     and the Employer fails to remedy the condition within thirty (30) days
     after its receipt of such written notice from the Executive, and the
     Executive notifies the Employer in writing of the Executive's resignation
     for failure to cure a good reason within ten (10) days after such thirty
     (30) day cure period.  Good reason shall mean:

               (i) a reduction in the Executive's Salary (other than in
          connection with a salary reduction applicable to senior executives of
          the Employer generally); or

               (ii) the Employer's material breach of this Agreement; or

               (iii)  the relocation of the offices at which the Executive is
          principally employed as of the Change of Control to a location more
          than fifty (50) miles from such offices, which relocation is not
          approved by the Executive; or

               (iv) a material and adverse change in the Executive's position,
          responsibilities or duties.

          (e) Certain Termination Benefits.  Unless otherwise specifically
     provided in this Agreement or otherwise required by law, all compensation
     and benefits payable to the Executive under this Agreement shall terminate
     on the date of termination of the Executive's employment under this
     Agreement.  Notwithstanding the foregoing, in the event of termination of
     the Executive's employment with the Employer pursuant to Section 6(c) or
     6(d) above, or in the event the Agreement is not extended by action of the
     Employer as provided in Section 3 (and subject to the notice requirements
     set forth in Section 3), the Employer shall provide to the Executive the
     following termination benefits ("Termination Benefits"):

               (i) continuation of the Executive's Salary at the rate then in
          effect pursuant to Section 4(a); and

               (ii) continuation of group health plan benefits to the extent
          authorized by and consistent with 29 U.S.C. (S) 1161 et seq. (commonly
          known as "COBRA"), with the cost of the regular premium for such
          benefits paid in full by the Employer.

     The Termination Benefits set forth in (i) above shall continue for a period
     of two years from the date of the Executive's termination; provided that in
     the event that the Executive

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     commences any employment or self-employment in violation of Section 7(d)
     during the period during which the Executive is entitled to receive
     Termination Benefits (the "Termination Benefits Period"), the remaining
     amount of Salary due pursuant to Section 6(e)(i) for the period from the
     commencement of such employment or self-employment to the end of the
     Termination Benefits Period shall be forfeited and the payments provided
     under Section 6(e)(ii) shall cease effective as of the date of commencement
     of such employment or self-employment. The Employer's liability for Salary
     continuation pursuant to Section 6(e)(i) shall be reduced by the amount of
     any severance pay due or otherwise paid to the Executive pursuant to any
     severance pay plan or stay bonus plan of the Employer. Notwithstanding the
     foregoing, nothing in this Section 6(e) shall be construed to affect the
     Executive's right to receive COBRA continuation entirely at the Executive's
     own cost to the extent that the Executive may continue to be entitled to
     COBRA continuation after the Executive's right to continuation of benefits
     under Section 6(e)(ii) ceases. The Executive shall be obligated to give
     prompt notice of the date of commencement of any employment or self-
     employment during the Termination Benefits Period and shall respond
     promptly to any reasonable inquiries concerning any employment or self-
     employment in which the Executive engages during the Termination Benefits
     Period.

          (f) Conditions of Eligibility for Certain Payments.  Notwithstanding
     anything to the contrary in this Agreement, the Executive shall not be
     entitled to any Termination Benefit under this Agreement unless the
     Executive first (i) enters into a valid and irrevocable release of all
     claims against the Employer and any affiliate of the Employer, in a form
     then reasonably acceptable to the Employer and (ii) resigns from any and
     all positions, including, without implication of limitation, as a director,
     and officer, that the Executive then holds with the Employer and any
     affiliate of the Employer, provided however that the Executive shall not be
     obligated to enter into the release referred to in (e) above in the event
     that the Executive is not provided with a release by the Employer with
     respect to claims as to which the Employer has actual knowledge.

          (g) Disability.  If the Executive shall be disabled so as to be unable
     to perform the essential functions of the Executive's then existing
     position or positions under this Agreement with or without reasonable
     accommodation, the Board of Directors may remove the Executive from any
     responsibilities and/or reassign the Executive to another position with the
     Employer for the remainder of the Term or during the period of such
     disability.  Notwithstanding any such removal or reassignment, the
     Executive shall continue to receive the Executive's full Salary (less any
     disability pay or sick pay benefits to which the Executive may be entitled
     under the Employer's policies) and benefits under Section 4 of this
     Agreement (except to the extent that the Executive may be ineligible for
     one or more such benefits under applicable plan terms) for a period of time
     equal to the remainder of the Term.  If any question shall arise as to
     whether during any period the Executive is disabled so as to be unable to
     perform the essential functions of the Executive's then existing position
     or positions with or without reasonable accommodation, the Executive may,
     and at the request of the Employer shall, submit to

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     the Employer a certification in reasonable detail by a physician selected
     by the Employer to whom the Executive or the Executive's guardian has no
     reasonable objection as to whether the Executive is so disabled or how long
     such disability is expected to continue, and such certification shall for
     the purposes of this Agreement be conclusive of the issue. The Executive
     shall cooperate with any reasonable request of the physician in connection
     with such certification. If such question shall arise and the Executive
     shall fail to submit such certification, the Employer's determination of
     such issue shall be binding on the Executive. Nothing in this Section 6(f)
     shall be construed to waive the Executive's rights, if any, under existing
     law including, without limitation, the Family and Medical Leave Act of
     1993, 29 U.S.C. (S)2601 et seq. and the Americans with Disabilities Act, 42
     U.S.C. (S)12101 et seq.

          (h) Termination Pursuant to a Change of Control.  If there is a Change
     of Control, as defined in Section 6(h)(i) below, during the Term, the
     provisions of this Section 6(h) shall apply and shall continue to apply
     throughout the remainder of the term of this Agreement.  If, (1) within
     eleven (11) months following a Change of Control, the Executive's
     employment is terminated by the Employer or the Executive following the
     occurrence of any of the events listed in Section 6(h)(ii) below or if the
     Executive's employment is terminated without cause (in accordance with
     Section 6(c) above); or (2) during the twelfth (12th) month following the
     change of control the Executive chooses to resign from her employment, for
     any reason, in lieu of any payments under Section 6(e) above, the Employer
     shall pay to the Executive (or the Executive's estate, if applicable) a
     lump sum amount equal to 2.99 times the Executive's "base amount" within
     the meaning of Section 280G(b)(3) of the Internal Revenue Code of 1986, as
     amended (the "Code").

               (i) Change of Control shall mean the occurrence of one or more of
          the following events:

                    (A) following any conversion of Service Bancorp, MHC from
               mutual to stock form, any "person" (as such term is used in
               Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
               1934, as amended (the "Exchange Act")) becomes a "beneficial
               owner" (as such term is defined in Rule 13d-3 promulgated under
               the Exchange Act) (other than Service Bancorp, MHC, any trustee
               or other fiduciary holding securities under an employee benefit
               plan of the Employer, or any corporation owned, directly or
               indirectly, by the stockholders of the Employer, in substantially
               the same proportions as their ownership of stock of Service
               Bancorp, MHC), directly or indirectly, of securities of Service
               Bancorp, MHC, representing fifty percent (50%) or more of the
               combined voting power of any of Service Bancorp, MHC's then
               outstanding securities; or

                    (B) any "person" (as such term is used in Sections 13(d) and
               14(d)(2) of the Securities Exchange Act of 1934, as amended (the
               "Exchange Act")) becomes a "beneficial owner" (as such term is
               defined

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               in Rule 13d-3 promulgated under the Exchange Act) (other than
               Service Bancorp, MHC, Service Bancorp, Inc., any trustee or other
               fiduciary holding securities under an employee benefit plan of
               Service Bancorp, Inc. or the Employer, or any corporation owned,
               directly or indirectly, by the stockholders of Service Bancorp,
               Inc., in substantially the same proportions as their ownership of
               stock of Service Bancorp, Inc.), directly or indirectly, of
               securities of Service Bancorp, Inc. representing fifty percent
               (50%) or more of the combined voting power of Service Bancorp,
               Inc.'s then outstanding securities; or

                    (C) persons who, as of the Effective Date, constituted the
               Employer's Board of Directors (the "Incumbent Board") cease for
               any reason including, without limitation, as a result of a tender
               offer, proxy contest, merger or similar transaction, to
               constitute at least a majority of the Board of Directors,
               provided that any person becoming a director of the Employer
               subsequent to the Effective Date whose election was approved by
               at least a majority of the directors then comprising the
               Incumbent Board shall, for purposes of this Section 6(h), be
               considered a member of the Incumbent Board; or

                    (D) the stockholders of the Employer approve a merger or
               consolidation of the Employer with any other corporation or other
               entity, other than (1) a merger or consolidation which would
               result in the voting securities of the Employer outstanding
               immediately prior thereto continuing to represent (either by
               remaining outstanding or by being converted into voting
               securities of the surviving entity) more than fifty percent (50%)
               of the combined voting power of the voting securities of the
               Employer or such surviving entity outstanding immediately after
               such merger or consolidation or (2) a merger or consolidation
               effected to implement a recapitalization of the Employer (or
               similar transaction) in which no "person" (as hereinabove
               defined) acquires more than fifty percent (50%) of the combined
               voting power of the Employer's then outstanding securities; or

                    (E) the stockholders of Service Bancorp, Inc. approve a
               merger or consolidation of Service Bancorp, Inc. with any other
               corporation or other entity, other than (1) a merger or
               consolidation which would result in the voting securities of
               Service Bancorp, Inc. outstanding immediately prior thereto
               continuing to represent (either by remaining outstanding or by
               being converted into voting securities of the surviving entity)
               more than fifty percent (50%) of the combined voting power of the
               voting securities of Service Bancorp, Inc. or such surviving
               entity outstanding immediately after such merger or consolidation
               or (2) a merger or consolidation effected to implement a
               recapitalization of Service Bancorp, Inc. (or similar
               transaction) in which no "person" (as hereinabove defined)

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               other than Service Bancorp, MHC acquires more than fifty percent
               (50%) of the combined voting power of Service Bancorp, Inc.'s
               then outstanding securities; or

                    (F) following any conversion of Service Bancorp, MHC from
               mutual to stock form, the stockholders of Service Bancorp, MHC
               approve a merger or consolidation of Service Bancorp, MHC with
               any other corporation or other entity, other than (1) a merger or
               consolidation which would result in the voting securities of
               Service Bancorp, MHC outstanding immediately prior thereto
               continuing to represent (either by remaining outstanding or by
               being converted into voting securities of the surviving entity)
               more than fifty percent (50%) of the combined voting power of the
               voting securities of Service Bancorp, MHC or such surviving
               entity outstanding immediately after such merger or consolidation
               or (2) a merger or consolidation effected to implement a
               recapitalization of Service Bancorp, MHC (or similar transaction)
               in which no "person" (as hereinabove defined) acquires more than
               fifty percent (50%) of the combined voting power of the
               Employer's then outstanding securities; or

                    (G) the stockholders of the Employer approve a plan of
               complete liquidation of  the Employer or an agreement for the
               sale or disposition by the Employer of all or substantially all
               of the Employer's assets.

               (ii) The events referred to in Section 6(h) above shall be as
          follows:

                    (A) a reduction of the Executive's salary other than a
               reduction that (1) is based on the Employer's financial
               performance or (2) is similar to the reduction made to the
               salaries provided to all or most other senior executives of the
               Employer; or

                    (B) an adverse change in the Executive's responsibilities
               and/or duties which constitutes, when compared to the Executive's
               responsibilities and/or duties before the Change of Control, a
               demotion;  or

                    (C) a material loss of title or office; or

                    (D) the relocation of the offices at which the Executive is
               principally employed as of the Change of Control to a location
               more than fifty (50) miles from such offices, which relocation is
               not approved by the Executive.

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               (iii)  The Executive shall provide the Employer with reasonable
          notice and an opportunity to cure any of the events listed in Section
          6(h)(ii) and shall not be entitled to compensation pursuant to this
          Section 6(h) unless the Employer fails to cure within a reasonable
          period; and

               (iv)  Additional Limitation.

                    (A) Anything in this Agreement to the contrary
               notwithstanding, in the event that any compensation, payment or
               distribution by the Employer or the Holding Companies to or for
               the benefit of the Executive, whether paid or payable or
               distributed or distributable pursuant to the terms of this
               Agreement or otherwise (the "Severance Payments"), would be
               subject to the excise tax imposed by Section 4999 of the Internal
               Revenue Code of 1986, as amended (the "Code"), the following
               provisions shall apply:

               (i) If the Severance Payments, reduced by the sum of (1) the
          Excise Tax and (2) the total of the Federal, state, and local income
          and employment taxes payable by the Executive on the amount of the
          Severance Payments which are in excess of the Threshold Amount, are
          greater than or equal to the Threshold Amount, the Executive shall be
          entitled to the full benefits payable under this Agreement.

               (ii) If the Threshold Amount is less than (x) the Severance
          Payments, but greater than (y) the Severance Payments reduced by the
          sum of (1) the Excise Tax and (2) the total of the Federal, state, and
          local income and employment taxes on the amount of the Severance
          Payments which are in excess of the Threshold Amount, then the
          benefits payable under this Agreement shall be reduced (but not below
          zero) to the extent necessary so that the maximum Severance Payments
          shall not exceed the Threshold Amount.  To the extent that there is
          more than one method of reducing the payments to bring them within the
          Threshold Amount, the Executive shall determine which method shall be
          followed; provided that if the Executive fails to make such
          determination within 45 days after the Employer or the Holding
          Companies have sent the Executive written notice of the need for such
          reduction, the Employer or the Holding Companies may determine the
          amount of such reduction in their sole discretion.

     For the purposes of this Section 6(h)(iv), "Threshold Amount" shall mean
     three times the Executive's "base amount" within the meaning of Section
     280G(b)(3) of the Code and the regulations promulgated thereunder less one
     dollar ($1.00); and "Excise Tax" shall mean the excise tax imposed by
     Section 4999 of the Code, or any interest or penalties incurred by the
     Executive with respect to such excise tax.

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                    (B) The determination as to which of the alternative
               provisions of Section 6(h)(iv) shall apply to the Executive shall
               be made by an independent accounting firm designated by the
               Employer to which the Executive has no reasonable objection (the
               "Accounting Firm"), which shall provide detailed supporting
               calculations both to the Employers and the Holding Companies and
               the Executive within 15 business days of the Date of Termination,
               if applicable, or at such earlier time as is reasonably requested
               by the Employer and the Holding Companies or the Executive.  For
               purposes of determining which of the alternative provisions of
               Section 6(h)(iv) shall apply, the Executive shall be deemed to
               pay federal income taxes at the highest marginal rate of federal
               income taxation applicable to individuals for the calendar year
               in which the determination is to be made, and state and local
               income taxes at the highest marginal rates of individual taxation
               in the state and locality of the Executive's residence on the
               Date of Termination, net of the maximum reduction in federal
               income taxes which could be obtained from deduction of such state
               and local taxes.  Any determination by the Accounting Firm shall
               be binding upon the Employer and the Holding Companies and the
               Executive.

     7.  Confidential Information, Noncompetition and Cooperation.

          (a) Confidential Information.  As used in this Agreement,
     "Confidential Information" means information belonging to the Employer or
     the Holding Companies which is of value to the Employer or the Holding
     Companies in the course of conducting their business and the disclosure of
     which could result in a competitive or other disadvantage to any of them.
     Confidential Information includes, without limitation, financial
     information, reports, and forecasts; inventions, improvements and other
     intellectual property; trade secrets; know-how; designs, processes or
     formulae; software; market or sales information or plans; customer lists;
     and business plans, prospects and opportunities (such as possible
     acquisitions or dispositions of businesses or facilities) which have been
     discussed or considered by the management of the Employer or the Holding
     Companies.  Confidential Information includes information developed by the
     Executive in the course of the Executive's employment by the Employer, as
     well as other information to which the Executive may have access in
     connection with the Executive's employment.  Confidential Information also
     includes the confidential information of others with which the Employer has
     a business relationship.  Notwithstanding the foregoing, Confidential
     Information does not include information in the public domain, unless due
     to breach of the Executive's duties under Section 7(b).

          (b) Confidentiality.  The Executive understands and agrees that the
     Executive's employment creates a relationship of confidence and trust
     between the Executive and the Employer and the Holding Companies with
     respect to all Confidential Information.  At all times, both during the
     Executive's employment under this Agreement

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     and after its termination, the Executive will keep in confidence and trust
     all such Confidential Information, and will not use or disclose any such
     Confidential Information without the written consent of the Employer or the
     Holding Companies (whichever is appropriate), except as may be necessary in
     the ordinary course of performing the Executive's duties to the Employer or
     the Holding Companies.

          (c) Documents, Records, Etc.  All documents, records, data, apparatus,
     equipment and other physical property, whether or not pertaining to
     Confidential Information, which are furnished to the Executive by the
     Employer or the Holding Companies or are produced by the Executive in
     connection with the Executive's employment will be and remain the sole
     property of the Employer or the Holding Companies.  The Executive will
     return to the Employer or the Holding Companies all such materials and
     property as and when requested by either of them.  In any event, the
     Executive will return all such materials and property immediately upon
     termination of the Executive's employment for any reason.  The Executive
     will not retain with the Executive any such material or property or any
     copies thereof after such termination.

          (d) Noncompetition and Nonsolicitation.  During the Term and for one
     (1) year thereafter (or during the Termination Benefits Period, if longer),
     the Executive (i) will not, directly or indirectly, whether as owner,
     partner, shareholder, consultant, agent, employee, co-venturer or
     otherwise, engage, participate, assist or invest in any Competing Business
     (as hereinafter defined); (ii) will refrain from directly or indirectly
     recruiting or otherwise actively soliciting, inducing or influencing any
     person to leave employment with the Employer (other than terminations of
     employment of subordinate employees undertaken in the course of the
     Executive's employment with the Employer); and (iii) will refrain from
     actively soliciting or encouraging any customer or supplier to terminate or
     otherwise modify adversely its business relationship with the Employer
     other than actions taken by the Executive in good faith in the ordinary
     course of business during the Term.  Notwithstanding the foregoing, nothing
     in this Section 7(d) shall restrict the Executive from advertising
     employment opportunities to the general public or from hiring individuals
     who have not been directly or indirectly actively solicited, induced or
     influenced by the Executive to leave employment with the Employer.  The
     Executive understands that the restrictions set forth in this Section 7(d)
     are intended to protect the Employer's interest in its Confidential
     Information and established employee, customer and supplier relationships
     and goodwill, and agrees that such restrictions are reasonable and
     appropriate for this purpose.  For purposes of this Agreement, the term
     "Competing Business" shall mean a business that both (i) has one or more
     offices or branches located anywhere in any municipality that contains
     within its borders an office or branch of the Employer or any municipality
     which is contiguous with a municipality that contains within its borders an
     office or branch of the Employer and (ii) which is engaged in any business
     which the Employer or any of its affiliates conducts or plans (as described
     to the Board of Directors) to conduct at any time during the employment of
     the Executive.  Notwithstanding the foregoing, the Executive may own up to
     4.9% of the

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<PAGE>

     outstanding stock of a publicly held corporation which constitutes or is
     affiliated with a Competing Business.

          (e) Third-Party Agreements and Rights.  The Executive hereby confirms
     that the Executive is not bound by the terms of any agreement with any
     previous employer or other party which restricts in any way the Executive's
     use or disclosure of information or the Executive's engagement in any
     business.  The Executive represents to the Employer that the Executive's
     execution of this Agreement, the Executive's employment with the Employer
     and the performance of the Executive's proposed duties for the Employer
     will not violate any obligations the Executive may have to any such
     previous employer or other party.  In the Executive's work for the
     Employer, the Executive will not disclose or make use of any information in
     violation of any agreements with or rights of any such previous employer or
     other party, and the Executive will not bring to the premises of the
     Employer any copies or other tangible embodiments of non-public information
     belonging to or obtained from any such previous employment or other party.

          (f) Litigation and Regulatory Cooperation.  During and after the
     Executive's employment, the Executive shall cooperate fully with the
     Employer in the defense or prosecution of any claims or actions now in
     existence or which may be brought in the future against or on behalf of the
     Employer which relate to events or occurrences that transpired while the
     Executive was employed by the Employer.  The Executive's full cooperation
     in connection with such claims or actions shall include, but not be limited
     to, being available to meet with counsel to prepare for discovery or trial
     and to act as a witness on behalf of the Employer at mutually convenient
     times.  During and after the Executive's employment, the Executive also
     shall cooperate fully with the Employer in connection with any
     investigation or review of any federal, state or local regulatory authority
     as any such investigation or review relates to events or occurrences that
     transpired while the Executive was employed by the Employer.  The Employer
     shall reimburse the Executive at a daily rate of $500 and for any
     reasonable out-of-pocket expenses incurred in connection with the
     Executive's performance of obligations pursuant to this Section 7(f).

          (g) Injunction.  The parties agree that it would be difficult to
     measure any damages caused to either of them which might result from any
     breach by the other of the promises set forth in this Section 7, and that
     in any event money damages would be an inadequate remedy for any such
     breach.  Accordingly, subject to Section 8 of this Agreement, the parties
     agree that if either of them breaches, or proposes to breach, any portion
     of this Agreement, the other shall be entitled, in addition to all other
     remedies that it may have, to an injunction or other appropriate equitable
     relief to restrain any such breach without showing or proving any actual
     damage to such party.

     8.  Arbitration of Disputes.   Any controversy or claim arising out of or
relating to this Agreement or the breach thereof or otherwise arising out of the
Executive's employment or

                                       13
<PAGE>

the termination of that employment (including, without limitation, any claims of
unlawful employment discrimination whether based on age or otherwise) shall, to
the fullest extent permitted by law, be settled by arbitration in any forum and
form agreed upon by the parties or, in the absence of such an agreement, under
the auspices of the American Arbitration Association ("AAA") in Boston,
Massachusetts in accordance with the Employment Dispute Resolution Rules of the
AAA, including, but not limited to, the rules and procedures applicable to the
selection of arbitrators provided that the Employer and the Executive shall
evenly split the costs of such arbitration, unless the Executive prevails in the
arbitration, as determined by the arbitrator, in which case the Employer shall
pay for all arbitration fees and costs, including attorneys' fees. Judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. This Section 8 shall be specifically enforceable.
Notwithstanding the foregoing, this Section 8 shall not preclude either party
from pursuing a court action for the sole purpose of obtaining a temporary
restraining order or a preliminary injunction in circumstances in which such
relief is appropriate; provided that any other relief shall be pursued through
an arbitration proceeding pursuant to this Section 8.

     9.  Consent to Jurisdiction.  To the extent that any court action is
permitted consistent with or to enforce Section 8 of this Agreement, the parties
hereby consent to the jurisdiction of the Superior Court of the Commonwealth of
Massachusetts and the United States District Court for the District of
Massachusetts.  Accordingly, with respect to any such court action, the
Executive (a) submits to the personal jurisdiction of such courts; (b) consents
to service of process; and (c) waives any other requirement (whether imposed by
statute, rule of court, or otherwise) with respect to personal jurisdiction or
service of process.

     10.  Integration.  This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter.

     11.  Assignment; Successors and Assigns, Etc.  Neither the Employer nor the
Executive may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Employer may assign its rights under this Agreement
without the consent of the Executive in the event that the Employer shall effect
a reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity.  This Agreement shall inure to the benefit of and be binding
upon the Employer and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.

     12.  Enforceability. If any portion or provision of this Agreement
(including, without limitation, any portion or provision of any section of this
Agreement) shall to any extent be declared illegal or unenforceable by a court
of competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or unenforceable, shall not be affected thereby,
and each portion

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<PAGE>

and provision of this Agreement shall be valid and enforceable to the fullest
extent permitted by law.

     13.  Waiver.  No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party.  The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

     14.  Notices.  Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Employer or, in the case of the Employer, at its main offices, attention of the
Chief Executive Officer, and shall be effective on the date of delivery in
person or by courier or three (3) days after the date mailed.

     15.  Amendment.  This Agreement may be amended or modified only by a
written instrument signed by the Executive and by a duly authorized
representative of the Employer.

     16.  Governing Law.  This is a Massachusetts contract and shall be
construed under and be governed in all respects by the laws of the Commonwealth
of Massachusetts, without giving effect to the conflict of laws principles of
such Commonwealth.  With respect to any disputes concerning federal law, such
disputes shall be determined in accordance with the law as it would be
interpreted and applied by the United States Court of Appeals for the First
Circuit.

     17.  Counterparts.  This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.

     18.  Guarantee by the Holding Companies.  By the signatures of their
authorized officer representatives below, the Holding Companies hereby jointly
and severally guarantee the obligations of the Employer to the Executive set
forth in this Agreement.

     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Employer, the Holding Companies, by their respective duly authorized
officers, and by the Executive, as of the Effective Date.

                              STRATA BANK


                              /s/ William L. Casey
                              --------------------
                              By:  William L. Casey

                                       15
<PAGE>

                              SERVICE BANCORP, INC.


                              /s/ William L. Casey
                              --------------------
                              By:  William L. Casey, Chairman of the Board


                              SERVICE BANCORP, MHC


                              /s/ William L. Casey
                              --------------------
                              By:  William L. Casey, Chairman of the Board


                              EXECUTIVE


                              /s/ Pamela J. Montpelier
                              ------------------------
                              Pamela J. Montpelier

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