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                                                                   EXHIBIT 10.12


                               SEVERANCE AGREEMENT


                  THIS SEVERANCE AGREEMENT ("Severance Agreement") is made and
entered into effective as of the _____ day of _____________, 199___ ("Effective
Date"), by and between LOCAL FEDERAL BANK, F.S.B., a federally chartered stock
savings bank ("Bank") with address of 3601 N.W. 63rd Street, Oklahoma City,
Oklahoma 73116, and ________________________, an individual resident of the
State of Oklahoma, with mailing address of _________________________________
_____________________________ ("Executive").

                                R E C I T A L S:

                  A. Bank is engaged in the banking business in the State of
Oklahoma, with principal offices in Oklahoma City, Oklahoma, and branch
locations at various sites throughout the State of Oklahoma. Local Financial
Corporation ("LFC") is a Delaware corporation which owns all of the issued and
outstanding stock of Bank with its principal place of business in Oklahoma City,
Oklahoma. LFC is a publicly-held company which has its stock listed on the
American Stock Exchange.

                  B. Executive has been hired to serve as __________________Vice
President of Bank. As a condition and term of his employment by Bank, it is
entering into and granting him the rights and benefits set forth in this
Severance Agreement.

                  C. Executive is willing to enter into this Severance Agreement
with Bank and to serve as _________ Vice President of the Bank in consideration
of the severance payment entitlements granted to him by Bank hereunder and
certain other additional and other valuable benefits, compensation and
inducements to be granted him by Bank as agreed to between them.

                  D. The Board of Directors of Bank has approved and authorized
Bank entering into this Severance Agreement with Executive.

                  E. Accordingly, Bank and Executive desire to enter into this
Severance Agreement to set forth the terms and conditions of the severance pay
entitlements being granted to Executive by Bank herein.

                  NOW, THEREFORE, in consideration of the aforementioned
Recitals, the premises, the mutual covenants set forth herein, and of such other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by Bank and Executive, respectively, they do each hereby covenant
and agree with the other as follows:

                  1. DEFINITIONS. For all purposes in this Severance Agreement,
the following terms shall have the respective meanings specified below:

                           (a) "Annual Cash Compensation" means Executive's
                  annual base salary in effect as of the date of this Agreement,
                  or if greater, Executive's annual base salary in effect at the
                  time of the Change of Control, or at the time of the
                  termination of his employment without "Cause" by Bank, or by
                  Executive for Good Reason, during the 


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                  term of this Severance Agreement as expressly provided in
                  Section 3, below, whichever amount is greater.

                           (b) "Bank" means (x) the Bank until a Change of
                  Control, and (y) the successor to the Bank upon a Change of
                  Control ("Bank's Successor").

                           (c) "Cause" with respect to the termination of
                  Executive's employment by the Bank shall mean termination of
                  Executive's employment by the Bank for cause because of
                  Executive's personal dishonesty, incompetence, willful
                  misconduct, breach of fiduciary duty involving personal
                  profit, intentional failure to perform the stated duties of
                  his employment by the Bank, willful violation of any law, rule
                  or regulation (other than traffic violations or similar
                  offenses), or of a final cease-and-desist order, or for
                  purposes of any entitlement to the severance pay under this
                  Severance Agreement in the event of the death or permanent
                  disability of Executive occurring during the term of this
                  Severance Agreement. For purpose of this Severance Agreement,
                  the term "permanent disability" shall mean if Executive shall
                  have an illness, injury or other physical or mental condition
                  which results in Executive's inability to perform
                  substantially the duties he performs in his employment
                  capacity for the Bank to the extent he was performing such
                  duties immediately prior to the commencement of such condition
                  and that such disability has continued for a period of more
                  than one hundred twenty (120) days during the term of this
                  Severance Agreement. If Executive shall be so disabled for
                  more than one hundred twenty (120) days during the term of
                  this Severance Agreement, the employment of Executive by the
                  Bank shall be deemed by reason of his permanent disability to
                  have been for all purposes hereunder terminated for "Cause"
                  under the terms and provisions of this Severance Agreement. In
                  determining the incompetence of Executive for purposes of
                  application of this definition under this Section 1(c), the
                  acts or omissions of Executive shall be measured against
                  standards generally prevailing in the federal savings bank
                  industry.

                           (d) "Change of Control" shall for all purposes in
                  this Severance Agreement mean the occurrence of any of the
                  following events:

                                    (i) the consummation of any agreement of
                           merger, statutory share exchange or consolidation
                           pursuant to which either LFC, or the Bank, is merged
                           or consolidated into, or all of the outstanding
                           shares of LFC's or the Bank's common stock are
                           acquired by, another corporation, partnership,
                           limited liability company or partnership, or any
                           other business entity; or

                                    (ii) another corporation or such other
                           business entity is merged or consolidated into LFC or
                           the Bank in circumstances under which the outstanding
                           shares of LFC's or the Bank's common stock are
                           converted into or exchanged for cash or securities of
                           another such corporation or entity which was not a
                           wholly-owned subsidiary of LFC or the Bank at all
                           times within one year prior to the said merger or
                           consolidation; or


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                                    (iii) (x) the consummation of a sale of
                           fifty percent (50%) or more of the issued and
                           outstanding common stock of the Bank by LFC; or (y)
                           fifty percent (50%) or more of the issued and
                           outstanding common stock of LFC is acquired by
                           persons (including corporations or any other form of
                           business entity) who are acting in concert; or (z)
                           the consummation of the sale of all or substantially
                           all of the assets of the Bank by LFC.

                           (e) "Good Reason" with respect to Executive shall
                  have the following meaning for all purposes under this
                  Severance Agreement:

                                    (i) A significant diminution of his Role, as
                           that term is defined below in this Section 1, if the
                           diminution in his Role is not reasonably related to
                           an adverse change in his performance of his assigned
                           duties at the Bank; provided that Good Reason shall
                           not exist under this clause in the case of
                           termination for "Cause," as that term is defined in
                           above in this Section 1, or diminution of his Role by
                           reason of the voluntary actions of Executive, or on
                           account of his disability, retirement or death, as
                           described and defined herein, or the voluntary
                           termination by Executive of his employment by Bank
                           other than for a Good Reason, as defined hereunder;

                                    (ii) A reduction in the base salary and/or
                           bonuses paid to Executive to an amount such that the
                           sum of his base salary and bonuses as so reduced is
                           less than the sum of his base salary and bonuses as
                           of the Effective Date of this Severance Agreement, or
                           at any time while the Severance Agreement is in force
                           if Executive receives an increase in salary or bonus
                           after the date of this Severance Agreement, or a
                           failure after twenty (20) days' written notice by
                           Executive to Bank, or Bank's Successor, of Bank, or
                           Bank's Successor, to pay Executive any installment
                           owing to him of such salary or bonus;

                                    (iii) The failure by Bank, or Bank's
                           Successor, to provide Executive with any material
                           benefit that is provided to the executive officers of
                           the Bank, or Bank's Successor, generally, or any
                           action or inaction by the Bank, or Bank's Successor,
                           which could adversely affect his continued
                           participation in any benefit plan, entitlements or
                           other arrangements of the Bank, or Bank's Successor,
                           or his ability to enjoy or realize upon any material
                           benefit under any such plan, entitlement or
                           arrangement;

                                    (iv) The Bank's, or Bank's Successor,
                           assigning Executive, without his prior written
                           consent, to perform his duties for the Bank, or
                           Bank's Successor, at a location anywhere other than
                           __________ County, State of Oklahoma; or

                                    (v) The failure by the Bank, or Bank's
                           Successor, to obtain the assumption of all of its
                           obligations under this Severance Agreement and under
                           the stock option agreement being made and entered
                           into by and 


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                           between LFC and Executive this same date by Bank's
                           Successor, or to otherwise comply with the terms and
                           provisions of Section 9, below.

                           (f) "LFC" means (x) LFC until a Change of Control,
                  and (y) the successor to LFC upon a Change of Control (LFC's
                  "Successor").

                           (g) "Role" shall have the meaning for all purposes
                  under this Severance Agreement of (i) prior to any Change of
                  Control, as defined herein, Executive's authority or
                  responsibilities with the Bank on the date of this Severance
                  Agreement; or any enhanced Role (other than by way of an
                  interim or otherwise expressly temporary appointment) to which
                  he had ascended after the date of this Severance Agreement;
                  and (ii) after any Change of Control, the authority and
                  responsibilities with the Bank's Successor as described in
                  writing by the Bank's Successor prior to the Change of Control
                  and which is reasonably commensurate with Executive's Role, as
                  defined in clause g(i) above, in this definition.

                           (h) "Severance Period" shall for all purposes in this
                  Severance Agreement mean a period of years after Executive's
                  termination that is equal to the number by which Executive's
                  Annual Cash Compensation is multiplied to determine the
                  Severance Benefit payable to him under the provisions of this
                  Severance Agreement.

                           (i) "Successor" shall mean for all purposes in this
                  Severance Agreement any entity that assumes all of the
                  obligations of LFC and the Bank under this Severance Agreement
                  pursuant to Section 9, below.

                  2. TERM OF SEVERANCE AGREEMENT. Subject to the provisions on
termination of Executive's employment by the Bank contained in Section 5, below,
this Severance Agreement shall terminate and be of no further force and effect
and Executive shall not have any further rights or entitlements hereunder on one
of the following two dates, whichever is applicable:

                           (a) if a Change of Control occurs prior to the third
                  (3rd) anniversary of the Effective Date of this Agreement,
                  then, and in that event, this Severance Agreement shall
                  terminate and be of no further force and effect either (i) on
                  the date which is the second (2nd) anniversary of the
                  effective date of that Change of Control (i.e., the date upon
                  which it is consummated), including any date that might occur
                  after the third (3rd) anniversary of the Effective Date of
                  this Agreement, or (ii) on the third (3rd) anniversary of the
                  Effective Date of this Agreement, whichever date shall last
                  occur; or

                           (b) if no Change of Control of Bank occurs prior to
                  the third (3rd) anniversary of the Effective Date of the
                  Severance Agreement, (i.e., the Change of Control is not
                  consummated prior to that date), then, and in that event, this
                  Severance Agreement shall terminate for all purposes and be of
                  no further force and effect on the third (3rd) anniversary of
                  the Effective Date of this Agreement, unless it is renewed or
                  extended by the Bank, in writing, prior to that said date.



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                  3. SEVERANCE BENEFIT. If at any time during the term of this
Severance Agreement (as defined in Section 2, above), the Bank's, or the Bank's
Successor's, employment of Executive is terminated (i) by the Bank, or the
Bank's Successor, as the case may be, without "Cause," or (ii) by Executive for
"Good Reason," then, and in either such event, the Severance Period shall be one
(1) year and the Bank, or the Bank's Successor, as the case may be, shall be
expressly obligated to pay to Executive an amount equal to his Annual Cash
Compensation multiplied by one (1), payable in full within ten (10) days after
the date of such termination of Executive's employment.

                  The severance payments to be made to Executive pursuant to
this Section 3, above, shall be hereinafter referred to as the "Severance
Benefit." In addition to payment of the Severance Benefit, any stock options or
other stock or stock-based awards previously made to Executive shall immediately
vest and become exercisable, to the extent exercise is required, after any
termination of Executive's employment on the basis described above in this
Section 3 and any and all restrictions on Executive's ability to obtain the full
economic benefit of such vested stock awards shall immediately thereupon lapse.
Executive shall have no obligation to seek other employment or to otherwise
attempt to mitigate the effect of this Section 3 of this Severance Agreement or
the Severance Benefit payable hereunder in order to be entitled to receive that
Severance Benefit. Any payment received by Executive from other employment shall
not serve to reduce in any way the amount of the Severance Benefit payable to
him hereunder. Executive shall not be entitled to receive any Severance Benefit
under this Severance Agreement if his employment is terminated (x) by the Bank,
or the Bank's Successor, as the case may be, for "Cause," or (y) by Executive
without "Good Reason."

                  4. TERMINATION OF EXECUTIVE'S EMPLOYMENT BY THE BANK.

                           (a) The Bank may terminate Executive's employment by
                  the Bank, with or without cause, at any time during the term
                  hereof, effective upon delivery of written notice to that
                  effect to Executive, anything in this Severance Agreement to
                  the contrary notwithstanding, but any such termination by the
                  Bank of Executive's employment, other than termination of his
                  employment for "Cause," during the term of this Severance
                  Agreement, shall entitle Executive to receive the applicable
                  Severance Benefit to which he is entitled in such event under
                  the provisions of Section 3, above. Executive shall not have
                  any right to receive any Severance Benefits or any other
                  benefits to which he would have otherwise been entitled under
                  this Severance Agreement if he terminates his employment by
                  the Bank without Good Reason during the term hereof, or if his
                  employment is terminated by the Bank for "Cause." The Bank and
                  Executive agree that it would be difficult to ascertain the
                  amount of damages owing to Executive if his employment is
                  terminated without "Cause" by the Bank or if he terminates his
                  employment for Good Reason during the term of this Severance
                  Agreement and, accordingly, the amount to be paid by the Bank
                  to Executive as the Severance Benefit in such event shall be
                  deemed to be liquidated damages for such termination of his
                  employment and not a forfeiture or penalty. Executive agrees
                  that the damages resulting to him in the event of such
                  termination of his employment during the term of this
                  Severance Agreement would be difficult and impractical to
                  ascertain and that therefore the amount of liquidated 



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                  damages comprising the Severance Benefit to be paid by the
                  Bank to him under this Severance Agreement in such event would
                  be a fair and reasonable amount of damages under such
                  circumstances. Accordingly, Executive agrees that his sole and
                  exclusive remedy, in the event of the termination of his
                  employment by the Bank without "Cause," or in the event he
                  terminates his employment for Good Reason, during the term of
                  this Severance Agreement, shall be strictly limited to his
                  right to receive such liquidated damages in the amount of the
                  Severance Benefit payable to him hereunder, and that he shall
                  not have, and he hereby expressly waives in such event, any
                  right to seek any other equitable or legal remedy or other
                  damages whether actual, special, consequential or punitive, by
                  reason of such termination of his employment.

                           (b) If Executive is suspended and/or temporarily
                  prohibited from participating in the conduct of the Bank's
                  affairs by a notice served under the provisions of Section
                  8(e)(3) or (g)(1) of the Federal Deposit Insurance Act [12
                  U.S.C. ss.1818(e)(3) and (g)(1)], Bank's obligations under
                  this Agreement shall be suspended as of the date of service of
                  said notice pursuant to the Act unless stayed by appropriate
                  proceedings. If the charges in the notice are dismissed, the
                  Bank may, in its discretion, (i) pay Executive all or part of
                  the compensation which was withheld by the Bank while their
                  obligations under this Agreement were suspended in accordance
                  herewith, and (ii) reinstate (in whole or in part) any of
                  their obligations which were so suspended.

                           (c) If Executive is removed and/or permanently
                  prohibited from participating in the conduct of Bank' affairs
                  by an order issued under Section 8(e)(4) or (g)(1) of the
                  Federal Deposit Insurance Act [12 U.S.C. ss.1818(e)(4) or
                  (g)(1)], all obligations of Bank under this Agreement shall
                  terminate as of the effective date of the order; provided,
                  however, the vested rights of the Bank and Executive under
                  this Agreement shall not be affected thereby.

                           (d) If the Bank is in default (as defined in Section
                  3(x)(1) of the Federal Deposit Insurance Act), all obligations
                  under this Agreement shall terminate as of the date of such
                  default, but this Section 3(d) shall not affect any vested
                  rights of the Bank or Executive under this Agreement.

                           (e) All obligations under this Agreement shall be
                  terminated, except to the extent determined that the
                  continuation of this Agreement is necessary for the continued
                  operations of the Bank:

                                    (i) by the Director of the Federal Deposit
                           Insurance Corporation, or his or her designee, at the
                           time the Federal Deposit Insurance Corporation enters
                           into an agreement to provide assistance to or on
                           behalf of the Bank under the authority contained in
                           Section. 13(c) of the Federal Deposit Insurance Act;
                           or


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                                    (ii) by the Director of the Federal Deposit
                           Insurance Corporation, or his or her designee, at the
                           time the Director, or his or her designee approves a
                           supervisory merger to resolve problems related to
                           operation of the Bank, or when the Bank is determined
                           by the Director to be in an unsafe or unsound
                           condition.

                           Any rights of the Bank or Executive under the
         Agreement that have already vested, however, shall not be affected by
         such action.

                  5. NO ASSIGNMENT OR SUCCESSION; DEATH OF EXECUTIVE. This
Severance Agreement is personal to Executive. Executive shall not assign or
delegate any of his rights or obligations under this Severance Agreement without
first obtaining the prior written consent of the Bank. In the event of
Executive's death during the term of this Severance Agreement, all of the rights
and entitlements of Executive under this Severance Agreement shall immediately
cease to include, without limitation, any and all rights to receive any
Severance Benefit as set forth in Section 3 of this Severance Agreement, above.
In such event, this Severance Agreement shall be deemed to be terminated and of
no further force and effect as of the date of his death, unless his entitlement
hereunder has become completely vested in him pursuant to the terms of Section 3
of this Agreement, above, prior to the date of his death.

                  6. AMENDMENTS OR ADDITIONS: ACTION BY BANK'S BOARD OF
DIRECTORS. No amendments or additions to this Severance Agreement shall be
binding unless in writing and executed by both the Bank and by Executive.
Provided, however, this Severance Agreement may also be amended unilaterally by
the Bank to delete or amend any provision that becomes the subject of
supervisory concern on the part of the Office of Thrift Supervision, the FDIC,
or of any other regulatory agency having supervisory authority over the Bank,
provided that any such concern must be expressed by such regulatory agency in
writing to the Bank. Prior to making any amendment to this Severance Agreement
permitted by this sentence, the Bank shall provide Executive with a copy of the
written concerns of the involved regulatory authorities, and, to the extent the
regulatory authorities permit, Executive shall have an opportunity to meet with
appropriate representatives of the regulatory authority to discuss such required
amendments.

                  7. BINDING ARBITRATION. Unless the Bank and Executive
expressly agree otherwise in writing, all disputes relating to this Severance
Agreement, or any breach thereof or the meaning and effect of any term and
provisions hereof, shall be submitted to binding arbitration by the Bank and
Executive, pursuant to the provisions of the Oklahoma Uniform Arbitration Act,
15 O.S. ss.801, et seq. (the "Act"), and in accordance with the Commercial
Arbitration Rules of the American Arbitration Association (the "Rules"). In the
event a dispute arises which cannot be informally resolved by the parties
hereto, a panel of three (3) arbitrators shall be selected to settle the
dispute. Within twenty (20) days following the demand by either party for
arbitration of a dispute arising under this Severance Agreement, the Bank shall
appoint an arbitrator knowledgeable and experienced in federal savings banks and
Executive shall appoint an arbitrator knowledgeable and experienced in federal
savings banks. The two (2) arbitrators so appointed shall together appoint a
third arbitrator, also knowledgeable and experienced in federal savings banks,
within twenty (20) days following the appointment of the last arbitrator
selected by the Bank and by Executive. In the event that the two (2) arbitrators
selected by the Bank and by Executive are unable to mutually select 




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a third arbitrator within the twenty (20) day period, the third arbitrator shall
be selected by the then presiding judge of the Oklahoma County, Oklahoma
District Court. If the presiding judge of the Oklahoma County, Oklahoma District
Court is unable or unwilling to make such selection, the parties will request
that the Chief United States District Judge of the United States District Court
for the Western District of Oklahoma make such selection. The panel of three (3)
arbitrators shall then determine a time and a place for the hearing and shall
notify the parties in writing personally or by registered mail no less than
twenty (20) days before the hearing. The arbitrators will hear the dispute in
accordance with the Act and the Rules. Each party hereto shall be entitled to be
represented by counsel and each party shall be solely responsible for the fees
of their respective counsel. A majority of arbitrators shall render a final
award within twenty (20) days following the conclusion of the hearing which
shall be final and binding upon all parties hereto. The expenses and fees of the
third arbitrator mutually selected by the first two (2) arbitrators shall be
divided equally between the parties. Each party shall be solely responsible for
the expenses and fees of the arbitrator whom it selected. The arbitrators may
include, as part of any award, for the recovery of attorney's fees by the
prevailing party. All other expenses incurred in the conduct of the arbitration
shall be divided equally between the parties. Judgment upon the award rendered
by the arbitrators may be entered in any court having jurisdiction thereof.

                  8. LFC'S, BANK'S AND THE BANK'S SUCCESSOR'S OPTION UPON THE
OCCURRENCE OF A CHANGE OF CONTROL. If LFC or the Bank enters into a definitive
agreement that would result in a Change of Control, as defined herein, then LFC
and the Bank may elect (i) to assign this Severance Agreement to the Successor
effective on the occurrence of the Change of Control, provided that such
Successor shall assume in writing all of the obligations of the Bank hereunder
and shall expressly acknowledge that a Change of Control of LFC or the Bank has
occurred within the meaning of this Severance Agreement so as to entitle
Executive to the Severance Benefit set forth in Section 3 of this Severance
Agreement, above, if his employment is thereafter terminated by the Bank or the
Successor without "Cause," or he thereafter voluntarily terminates his
employment for Good Reason, and provided further that LFC and the Bank shall
remain liable for the performance of all of their obligations under this
Severance Agreement if the Successor fails to so perform any of its obligations
under this Severance Agreement; or (ii) to terminate this Severance Agreement
upon written notice to Executive given pursuant to the terms and conditions of
this Severance Agreement not later than thirty (30) days after the execution of
any such definitive agreement to effect such a Change of Control, to be
effective on the effective date of the Change of Control, and upon consummation
of the Change of Control, paying to Executive, in readily available funds, his
compensation and benefits to the date on which such termination shall take
effect on the effective date of such Change of Control plus the full amount of
the then applicable Severance Benefit as provided for in Section 3, above.

                  9.       MISCELLANEOUS PROVISIONS.

                           (a) The Bank and Executive hereby jointly stipulate,
                  covenant and agree that this Severance Agreement is not
                  intended by them to be and does not in any sense constitute an
                  employment agreement between the Bank and Executive and that
                  Executive does not have any written agreement establishing his
                  employment relationship with the Bank nor shall the terms and
                  conditions of this Severance Agreement be so construed but
                  rather this Severance Agreement shall be deemed 



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                  limited to the sole and restricted purpose of describing the
                  terms and conditions of Executive's severance pay entitlement
                  should he be terminated under the circumstances described in
                  Section 3, above, during the term hereof, subject to the terms
                  and provisions set forth above in this Severance Agreement.

                           (b) All payments to be made to Executive under this
                  Severance Agreement will be subject to required withholding of
                  federal, state and local income and employment taxes.
                  Notwithstanding anything in this Severance Agreement to the
                  contrary, if any of the payments provided for in this
                  Severance Agreement, together with any other payment which
                  Executive has the right to receive from the Bank, or any
                  corporation which is a member of an "affiliated group" (as
                  defined in Section 1504(a) of the Internal Revenue Code of
                  1986 ("Code") without regard to Section 1504(b) of the Code)
                  of which the Bank is a member, would constitute a "parachute
                  payment" (as defined in Section 280Gb(2) of the Code), the
                  payments pursuant to this Severance Agreement shall be reduced
                  to the largest amount that will result in no portion of such
                  payments being subject to the excise tax imposed by Section
                  4999 of the Code; provided, however, that the determination as
                  to whether any reduction in the payment under this Agreement
                  pursuant to this proviso is necessary shall be made by
                  Executive in good faith, and such reasonable determination
                  shall be conclusive and binding upon the Bank with respect to
                  its treatment of the payment for tax reporting purposes and,
                  provided further, that Executive may determine in his
                  discretion what payment or payment provided for him herein
                  shall be so reduced.

                           (c) This Severance Agreement shall be binding upon,
                  and shall inure to the benefit of the Bank and Executive and
                  their respective heirs, personal and legal representatives,
                  successors and permitted assigns.

                           (d) The Bank and Executive agree that the
                  construction and interpretation of this Severance Agreement
                  shall at all times and in all respects be governed by the laws
                  of the United States of America where applicable and otherwise
                  in all respects by the laws of the State of Oklahoma.

                           (e) All notices required or permitted herein must be
                  in writing and shall be deemed to have been duly given on the
                  date of service and served personally or by telecopier, telex,
                  or other similar communication to the party or parties to whom
                  notice is to be given, on the next day if notice is effected
                  by overnight mail service, or on the third business day after
                  mailing in the United States mail, if mailed, to the party or
                  parties to whom notice is to be given by registered or
                  certified mail, return receipt requested, postage prepaid, to
                  the address of such party, as set forth in the first paragraph
                  of this Severance Agreement, or to such other address as any
                  party to this Severance Agreement may designate to the other
                  from time-to-time for this purpose in a manner complying with
                  the provisions of this section. Any communication which is
                  mailed by overnight mail or sent by telecopier or telex shall
                  be confirmed immediately, but failure to so confirm shall not
                  affect the effectiveness of such notice from and after the day
                  on which such notice is actually received.



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                           (f) Any provision of this Severance Agreement which
                  is prohibited or unenforceable in any jurisdiction shall not
                  invalidate the remaining provisions hereof and any prohibition
                  or unenforceability in any jurisdiction shall not invalidate
                  or render unenforceable such provision in any other
                  jurisdiction.

                           (g) This Severance Agreement contains the entire
                  agreement and understanding by and between the Bank and
                  Executive with respect to Executive's severance pay
                  entitlement as herein described, and supersedes all prior
                  agreements and understandings between the parties to this
                  Severance Agreement, relating to the subject matter of this
                  Severance Agreement. No waiver of any provision of this
                  Severance Agreement shall be valid unless the same is in
                  writing and signed by the party against whom such waiver is
                  sought to be enforced. Moreover, no valid waiver of any
                  provision of this Severance Agreement, at any time, shall be
                  deemed to be a waiver of any other provision of this Severance
                  Agreement at such time, or will be deemed a valid waiver of
                  such provision at any other time.

                           (h) This Severance Agreement may be executed in two
                  (2) or more counterparts, each of which shall be deemed an
                  original, but all of which shall constitute one and the same
                  instrument.

                           (i) Time shall be of the essence with regard to the
                  performance by the parties hereto of their respective
                  obligations hereunder.

                  IN WITNESS WHEREOF, the Bank and Executive have duly executed
this Severance Agreement as of the day and year first above written to be
effective as of the date stated in the first paragraph above.

LOCAL FEDERAL:                      LOCAL FEDERAL BANK, F.S.B.,
                                    a federally chartered stock savings bank



                                    By:
                                        ---------------------------------------
                                    Name:    Jan A. Norton
                                         --------------------------------------
                                    Title:   President
                                          -------------------------------------
                                    Date:
                                         --------------------------------------



EXECUTIVE:
                                    -------------------------------------------
                                    Name:
                                         --------------------------------------
                                    Title:
                                          -------------------------------------
                                    Date:
                                         --------------------------------------



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