EXHIBIT 10.2


                    EMPLOYMENT AGREEMENT OF MICHAEL R. HOWELL



<PAGE>
                               CHARTER BANK, S.B.
                              EMPLOYMENT AGREEMENT


         This  Agreement  is made  effective as of April 17, 1997 by and between
Charter Bank,  S.B. (the "Bank"),  an  Illinois-chartered  savings bank with its
principal  administrative  office at 114 West Broadway,  Sparta,  Illinois,  and
Michael R. Howell (the  "Executive").  Any reference to "Holding Company" herein
shall mean Charter Financial, Inc. or any successor thereto.

         WHEREAS,  the Bank wishes to assure itself of the services of Executive
for the period provided in this Agreement; and

         WHEREAS,  Executive  is willing to serve in the employ of the Bank on a
full-time basis for said period.

         NOW,  THEREFORE,  in  consideration  of  the  mutual  covenants  herein
contained,  and upon the other terms and conditions  hereinafter  provided,  the
parties hereby agree as follows:

1. POSITION AND RESPONSIBILITIES

         During  the period of his  employment  hereunder,  Executive  agrees to
serve as  Executive  Vice  President  and  Treasurer  of the Bank and of Charter
Financial,  Inc. During said period, Executive may, in his discretion,  agree to
serve, if elected,  as an officer and director of any subsidiary or affiliate of
the Bank, with appropriate  adjustments to the compensation specified in Section
3(a).  Failure to reelect  Executive as Executive  Vice  President and Treasurer
without the consent of the  Executive  during the term of this  Agreement  shall
constitute a breach of this Agreement.

2. TERMS AND DUTIES

         (a) The period of Executive's  employment under this Agreement shall be
deemed to have  commenced as of the date first above written and shall  continue
for a period of thirty-six (36) full calendar months  thereafter.  Commencing on
the first anniversary date of this Agreement, and continuing at each anniversary
date thereafter,  the Agreement shall renew for an additional year such that the
remaining  term shall be three (3) years  unless  written  notice is provided to
Executive at least ten (10) days and not more than twenty (20) days prior to any
such anniversary date, that his employment shall cease at the end of twenty-four
(24) months  following such  anniversary  date.  Prior to each notice period for
non-renewal,  the Board of Directors of the Bank ("Board") will conduct a formal
performance  evaluation  and review of the Executive for purposes of determining
whether to extend the  Agreement,  and the results  thereof shall be included in
the minutes of the Board's meeting.

         (b) During the period of his employment  hereunder,  except for periods
of absence occasioned by illness,  reasonable  vacation periods,  and reasonable
leaves of absence,  Executive shall devote  substantially all his business time,
attention,  skill,  and  efforts  to the  faithful  performance  of  his  duties
hereunder  including  activities  and  services  related  to  the  organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board,  as evidenced by a  resolution  of such Board,  from time to time,
Executive  may serve,  or continue to serve,  on the boards of directors of, and
hold any other offices or positions in,  companies or  organizations,  which, in
such Board's judgment,  will not present any conflict of interest with the Bank,
or materially  affect the  performance  of Executive's  duties  pursuant to this
Agreement.

3. COMPENSATION AND REIMBURSEMENT

         (a) The  compensation  specified under this Agreement shall  constitute
the salary and benefits paid for the duties  described in Section 2(b). The Bank
shall pay Executive as  compensation a salary of not less than  $100,327.68  per
year ("Base Salary"). Such Base Salary shall be payable on the 15th and last day
of each  month.  During the period of this  Agreement,  Executive's  Base Salary
shall be reviewed at least annually; the first such review will be made no later
than October 15, 1997. Such review shall be conducted by a Committee  designated
by the Board, and the Board may increase Executive's Base Salary. In addition to
the Base Salary provided in this Section 3(a), the Bank shall provide  Executive
at no cost to Executive with all such other  benefits as are provided  uniformly
to permanent full-time employees of the Bank.

         (b) The Bank  will  provide  Executive  with  employee  benefit  plans,
arrangements  and  perquisites   substantially  equivalent  to  those  in  which
Executive was participating or otherwise deriving benefit from immediately prior
to the beginning of the term of this Agreement,  and the Bank will not,  without
Executive's prior written consent, make any changes in such plans,  arrangements
or  perquisites  which would  adversely  affect  Executive's  rights or benefits
thereunder.  Without limiting the generality of the forgoing  provisions of this
Subsection (b), Executive will be entitled to participate in or receive benefits
under any employee benefit plans including but not limited to, retirement plans,
supplemental   retirement   plans,   pension   plans,    profit-sharing   plans,
health-andaccident  plan, medical coverage or any other employee benefit plan or
arrangement made available by the Bank m the future to its senior executives and
key management  employees,  subject to and on a basis consistent with the terms,
conditions and overall administration of such plans and arrangements.  Executive
will be entitled to incentive  compensation  and bonuses as provided in any plan
of the Bank in which Executive is eligible to  participate.  Nothing paid to the
Executive  under  any such plan or  arrangement  will be deemed to be in lieu of
other compensation to which the Executive is entitled under this Agreement.

         (c) In addition to the Base Salary  provided  for by  paragraph  (a) of
this Section 3, the Bank shall pay or  reimburse  Executive  for all  reasonable
travel and other  reasonable  expenses  incurred  by  Executive  performing  his
obligations under this Agreement and may provide such additional compensation in
such form, including annual bonuses, and such amounts as the Board may from time
to time determine.

         (d)  Compensation  and  reimbursement to be paid pursuant to paragraphs
(a),  (b) and (c) of this  Section  3 shall be paid by the Bank and the  Holding
Company,  respectively  on a pro rata basis based upon the amount of service the
Executive devotes to the Bank and Holding Company, respectively.

4. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION

         The  provisions of this Section shall in all respects be subject to the
terms and conditions stated in Sections 7 and 15.

         (a) Upon the occurrence of an Event of Termination  (as herein defined)
during the Executive' s term of employment under this Agreement,  the provisions
of  this  Section  shall  apply.  As  used  in  this  Agreement,  an  "Event  of
Termination"  shall mean and included any one or more of the following:  (i) the
termination  by the  Bank  or  the  Holding  Company  of  Executive's  full-time
employment  hereunder for any reason other than a Change in Control,  as defined
in Section 5(a) hereof, or Termination for Cause as defined in Section 7 hereof;
or (ii) Executive's  resignation from the Bank's employ, upon any (A) failure to
elect or reelect  or to  appoint  or  reappoint  Executive  Vice  President  and
Treasurer,   (B)   material   change  in   Executive's   function   duties,   or
responsibilities, which change would cause Executive's position to become one of
lesser  responsibility,  importance,  or scope from the position and  attributes
thereof  described  in Section I, above (and any such  material  change shall be
deemed a continuing  breach of this Agreement),  (C) a relocation of Executive's
principal  place of  employment  by more than 30 miles from its  location at the
effective date of this  Agreement,  or a material  reduction in the benefits and
perquisites  to the Executive from those being provided as of the effective date
of this  Agreement,  (D)  liquidation  or  dissolution  of the  Bank or  Holding
Company, or (E) breach of this Agreement by the Bank. Upon the occurrence of any
event  described in clauses (A), (B), (C), (D) or (E),  above,  Executive  shall
have the right to elect to  terminate  his  employment  under this  Agreement by
resignation  upon sixty (60) days prior written notice given within a reasonable
period of time not to exceed four calendar months after the event giving rise to
said right to elect.  Notwithstanding the preceding sentence,  in the event of a
continuing  breach the Executive,  after giving due notice within the proscribed
time frame of an occurrence  specified above,  shall not waive any of his rights
solely by virtue of the fact that  Executive  and the Bank are  engaged  in good
faith  discussions  to resolve any  occurrence of an event  described in clauses
(A), (B), (C), (D) and (E) above.

         (b) Upon the  occurrence  of an  Event of  Termination,  on the Date of
Termination,  as defined in Section 9, the Bank shall pay Executive,  or, in the
event of his subsequent death, his beneficiary or beneficiaries,  or his estate,
as the case may be, as severance pay or liquidated damages, or both, a sum equal
to the greater of the payments due for the  remaining  term of the  Agreement or
three (3) times the average of the three preceding years' Base Salary, including
bonuses and any other cash compensation paid to the Executive during such years,
and the amount of any benefits  received pursuant to any employee benefit plans,
on behalf of the Executive,  maintained by the Bank during such years; provided,
however,  that  if the  Bank  is not in  compliance  with  its  minimum  capital
requirements  or if such payments  would cause the Bank's  capital to be reduced
below its minimum  capital  requirements,  such payments shall be deferred until
such time as the Bank is in capital compliance, and provided further, that in no
event shall total severance compensation from ail sources exceed three times the
Executive's  Base Salary for the immediately  preceding year. At the election of
the Executive,  which election is to be made within thirty (30) days of an Event
of Termination, such payments shall be made in a lump sum or paid monthly during
the remaining term of the agreement  following the Executive's  termination.  In
the event that no election is made,  payment to the Executive  will be made on a
monthly basis during the remaining  term of the  agreement.  Such payments shall
not be reduced in the event the  Executive  obtains other  employment  following
termination of employment.  The Executive shall not be required to mitigate such
payments by seeking other employment.

         (c) Notwithstanding the provisions of Sections 4(a) and (b), and in the
event that  there has not been a change in  control as defined in Section  5(a),
upon the Voluntary Termination by the Executive upon giving sixty days notice to
the Bank (which shall not be deemed to constitute an "Event of  Termination"  as
defined  herein),  the  Bank,  shall  pay  Executive,  or in  the  event  of his
subsequent death, his beneficiary or  beneficiaries,  or his estate, as the case
may be, a  severance  payment in an amount  equal to the  Executive's  preceding
year's Base Saiary,  including  bonuses and any other cash  compensation paid to
the Executive during such year, and the amount of any benefits received pursuant
to any employee  benefit plans,  on behaif of the  Executive,  maintained by the
Bank during such years; provided, however, that if the Bank is not in compliance
with its minimum capital requirements or if such payments would cause the Bank's
sapital to be reduced  below its minimum  capital  requirements,  such  payments
shall be deferred until such time as the Bank is in capital  compliance.  At the
election of the Executive,  which election is to be made within thirty (30) days
of an Event of  Termination,  any  payments  shall be made in a lump sum or paid
monthly  during the remaining  term of the agreement  following the Executive' s
termination. In the event that no election is made, any payment to the Executive
will be made on a monthly basis during the remaining term of the agreement. Such
payments  shall  not be  reduced  in  the  event  the  Executive  obtains  other
employment following termination of employment.

         (d) Upon the occurrence of an Event of Termination, the Bank will cause
to be continued  life,  madical,  dental and disability  coverage  substantially
identical  to the  coverage  maintained  by the Bank of  Executive  prior to his
termination, provided that such benefits shall not be provided in the event they
should  constitute an unsafe or unsound banking  practice  relating to executive
compensation and employment  contracts pursuant to applicable  regulations as is
now or hereafter in effect.
Such coverage  shall cease upon the  expiration  of the  remaining  term of this
Agreement.

         (e) In the event  that the  Executive  is  receiving  monthly  payments
pursuant to Section 4(b) or (c) hereof, on an annual basis, thereafter,  between
the dates of  January 1 and  January  31 of each  year,  Executive  shall  elect
whether the balance of the amount payable under the Agreement at that time shall
be paid in a lump sum or on a pro rata basis. Such election shall be irrevocable
for the year for which such election is made.

5. CHANGE IN CONTROL

         (a) No benefit shall be payable under this Section 5 unless there shall
have  been  a  Change  in  Control.   A  "Change  in   Control"   shall  mean  a
reorganization,  merger,  merger  conversion,  consolidation  or  sale of ail or
substantially  all of the  assets  of the  Bank  or  the  Company  or a  similar
transaction  m which  the Bank or  Company  is not the  resulting  entity;  (ii)
individuals  who  constitute  the board of directors of the Bank or the board of
directors of the Company as of the date hereof (the  "Incumbent  Board"),  cease
for any reason to  constitute  at least a majority  thereof,  provided  that any
person  becoming a director  subsequent  to the date hereof  whose  election was
approved by a vote of at least  three-fourths  of the  directors  composing  the
Incumbent  Board or whose  nomination  for  election by the Bank's or  Company's
stockholders  or members was approved by the same nominating  Committee  serving
under an Incumbent  Board shall be for purposes of this  section  considered  as
though he were a member  of the  Incumbent  Board;  or (iii) an  acquisition  of
"control" of the Bank or the Company as defined by the Bank Holding  Company Act
of 1956, as amended, and applicable rules and regulations promulgated thereunder
as in effect at the time of the Change in Control (collectively, the "BHCA"), as
determined  by the board of  directors  of the Bank or the  Company,  or (iv) an
acquisition of the Bank's stock requiring  submission of notice under the Change
in Bank Control Act;  provided,  however,  that a change in control shall not be
deemed to have occurred under clauses (i), (iii), or (iv) of this section if the
transaction(s) constituting a change in control is approved by a majority of the
board of directors of the Bank or the Company, as the case may be.

         (b) If any of the events described in Section 5(a) hereof  constituting
a Change in Control have occurred,  Executive  shall be entitled to the benefits
provided in  paragraphs  (c),  (d), (e), (f), (g) and (h) of this Section 5 upon
his  subsequent  termination  of  employment at any time during the term of this
Agreement  (regardless of whether such termination  results from his resignation
or his dismissal),  unless such termination is because of his death, termination
for Cause or termination for Disability.  Upon the Change in Control,  Executive
shall have the right to elect to terminate his  employment  with the Bank at any
time, for any reason, during the term of this Agreement.

         (c)  Upon  the  occurrence  of a  Change  in  Control  followed  by the
Executive' s termination of employment,  the Bank shall pay Executive, or in the
event of his subsequent death, his beneficiary or beneficiaries,  or his estate,
as the case may be, a severance pay or liquidated  damages, or both, a sum equal
to the greater of the payments due for the  remaining  term of the  Agreement or
2.99 times the  average of the five  preceding  years'  Base  Salary,  including
bonuses and any other cash compensation paid to the Executive during such years,
and the amount of any  contributions  made to any  employee  benefit  plans,  on
behalf of the  Executive,  maintained  by the Bank  during  such  years.  At the
election of the Executive,  which election is to be made within thirty (30) days
of the Date of  Termination  following a Change in Control,  such payment may be
made in a lump sum or paid in equal monthly  installments  during the thirty-six
(,6) months following the Executive's termination. In the event that no election
is made,  payment to the  Executive  will be made on a monthly  basis during the
remaining term of the Agreement.

         (d)  Upon  the  occurrence  of a  Change  in  Control  followed  by the
Executive's termination of employment, the Bank will cause to be continued life,
medical,  dental and disability coverage substantially identical to the coverage
maintained by the Bank for Executive prior to his severance.

         Such  coverage  and  payments   shall  cease  upon  the  expiration  of
thirty-six (36) months.

         (e)  Upon the  occurrence  of a Change  m  Control,  Executive  will be
entitled to any benefits granted to him pursuant to any stock option plan of the
Bank or Holding Company.

           (f) Upon the  occurrence of a Change in Control the Executive will be
entitled to any benefits awarded to him under any of the Bank's  Recognition and
Retention Plans arising from a Change in Control.

         (g) In the event  that the  Executive  is  receiving  monthly  payments
pursuant to Section 5(c) hereof,  on an annual  basis,  thereafter,  between the
dates of January I and January 31 of each year,  Executive  shall elect  whether
the balance of the amount payable under the Agreement at that time shall be paid
in a lump sum or on a pro rata basis. Such election shall be irrevocable for the
year for which such election is made.

         (h) Notwithstanding the preceding  paragraphs of this Section 5, in the
event that:

(i)   the  aggregate  payments or  benefits to be made or afforded to  Executive
      under said  paragraphs  (the  "Termination  Benefits")  would be deemed to
      include an "excess  parachute  payment"  under Section 280G of the Code or
      any successor thereto, and

(ii)  if  such   Termination   Benefits   were   reduced   to  an  amount   (the
      "Non-Triggering  Amount"),  the value of which is one dollar  ($1.00) less
      than an amount  equal to the total  amount of payments  permissible  under
      Section 280G of the Code or any successor thereto.

then the Termination  Benefits to be paid to Executive shall be so reduced so as
to be a Non-Triggering Amount.

         (i)  Notwithstanding  the foregoing,  there will be no reduction in the
compensation  otherwise  payable  to-Executive  during any period  during  which
Executive is incapable of performing his duties hereunder by reason of temporary
disability.

         (j) Any  payments  made to  Executive  pursuant  to this  Agreement  or
otherwise,  are subject to and conditioned  upon their compliance with 12 U.S.C.
ss. 1818(k) and any applicable regulations promulgated thereunder.

         (k) The  Executive  shall not be entitled to any  payments  pursuant to
this  Section  5 if the  Bank is not in  compliance  with  its  minimum  capital
requirements  or if such payments  would cause the Bank's  capital to be reduced
below its minimum  capital  requirements,  such payments shall be deferred until
such times as the Bank is in capital compliance and provided further, that in no
event shall total severance compensation from all sources exceed three times the
Executive's Base Salary for the immediately preceding year.

6. TERMINATION UPON RETIREMENT

         Termination by the Bank of the Executive  based on  "Retirement"  shall
mean  termination  in  accordance  with  the  Bank's  retirement  policy  or  in
accordance with any retirement arrangement  established with Executive's consent
with respect to him. Upon  termination of Executive upon  Retirement,  Executive
shall be  entitled to all  benefits  under any  retirement  plan of the Bank and
other plans to which Executive is a party.

7. TERMINATION FOR CAUSE

         The term "Termination for Cause" shall mean termination  because of the
Executive's  personal  dishonesty,  incompetence,  any breach of fiduciary  duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law,  rule,  or  regulation  (other than traffic  violations or
similar  offenses) or final  cease-and-desist  order,  or material breach of any
material provision of this Agreement. In determining  incompetence,  the acts or
omissions  shall be  measured  against  standards  generally  prevailing  in the
savings institutions  industry.  Notwithstanding the foregoing,  Executive shall
not be deemed to have been  Terminated  for Cause  unless and until  there shall
have  been  delivered  to  him a  copy  of a  resolution  duly  adopted  by  the
affirmative vote of not less than  threefourths of the members of the Board at a
meeting of the Board called and held for that purpose (after  reasonable  notice
to Executive and an  opportunity  for him,  together  with counsel,  to be heard
before  the  Board),  finding  that in the  good  faith  opinion  of the  Board,
Executive was guilty of conduct justifying  Termination for Cause and specifying
the  particulars  thereof in detail.  The Executive  shall not have the right to
receive  compensation  or other  benefits for any period after  Termination  for
Cause. Any stock options granted to Executive under any stock option plan of the
Bank, the Holding Company or any subsidiary or affiliate  thereof,  shall become
null and void effective upon  Executive's  receipt of Notice of Termination  for
Cause pursuant to Section 8 hereof, and shall not be exercisable by Executive at
any time subsequent to such Termination for Cause.

8. NOTICE

         (a) Any  purported  termination  by the Bank or by  Executive  shall be
communicated by Notice of Termination to the other party hereto. For purposes of
this  Agreement,  a "Notice of  Termination"  shall mean a written  notice which
shall indicate the specific termination  provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances  claimed to
provided a basis for termination of Executive's  employment  under the provision
so indicated.

         (b) "Date of Termination"  shall mean (A) if Executive's  employment is
terminated  for  Disability,  thirty (30) days after a Notice of  Termination is
given (provided that he shall not have returned to the performance of his duties
on a  full-time  basis  during  such  thirty  (30) day  period),  and (B) if his
employment is terminated for any other reason,  the date specified in the Notice
of Termination (which, in the case of a Termination for Cause, shall not be less
than thirty (30) days from the date such Notice of Termination is given).

         (c) If,  within  thirty  (30) days after any Notice of  Termination  is
given,  the party receiving such Notice of Termination  notifies the other party
that a dispute exists concerning the termination,  except upon the occurrence of
a Change in Control and voluntary termination by the Executive in which case the
date of  termination  shall be the date  specified  in the  Notice,  the Date of
Termination shall be the date on which the dispute is finally determined, either
by mutual written agreement of the parties,  by a binding  arbitration award, or
by a final judgment,  order or decree of a court of competent  jurisdiction (the
time for appeal having expired and no appeal having been perfected) and provided
further  that the Date of  Termination  shall be extended by a notice of dispute
only if such  notice is given in good  faith and the party  giving  such  notice
pursues   the   resolution   of  such   dispute   with   reasonable   diligence.
Notwithstanding the pendency of any such dispute,  the Bank will continue to pay
Executive  his full  compensation  in effect when the notice  giving rise to the
dispute was given  (including,  but not limited  to, Base  Salary) and  continue
Executive as a participant in all  compensation,  benefit and insurance plans in
which he was  participating  when the  notice of dispute  was  given,  until the
dispute is finally  resolved in  accordance  with this  Agreement.  Amounts paid
under this Section are in addition to all other amounts due under this Agreement
and shall not be offset  against  or reduce  any other  amounts  due under  this
Agreement.

9. POST-TERMINATION OBLIGATIONS


         (a) All payments and benefits to Executive  under this Agreement  shall
be subject to Executive~s compliance with paragraph (b) of this Section 9 during
the term of this  Agreement  and for one (I) full year after the  expiration  or
termination thereof

         (b) Executive shall, upon reasonable  notice,  furnish such information
and  assistance  to the  Bank  as may  reasonably  be  required  by the  Bank in
connection  with  any  litigation  in  which  it or any of its  subsidiaries  or
affiliates is, or may become, a party.

10. NON-COMPETITION

         (a) Upon any termination of Executive's  employment  hereunder pursuant
to Section 4(c) hereof, Executive agrees not to compete with the Bank and/or the
Holding  Company for a period of one (I) year following such  termination in any
city,  town or county in which the Bank and/or the Holding Company has an office
or has filed an  application  for  regulatory  approval to  establish an office,
determined as of the  effective  date of such  termination,  except as agreed to
pursuant to a resolution duly adopted by the Board. Executive agrees that during
such period and within said cities, towns and counties, Executive shall not work
for or advise,  consult or othertwise  serve with,  directly or indirectly,  any
entity whose business materially competes with the depository,  lending or other
business activities of the Bank and/or the Holding Company.  The parties hereto,
recognizing that  irreparable  injury will result to the Bank and/or the Holding
Company,  its business and properly in the event of  Executive's  breach of this
Subsection  10(a) agree that in the event of any such breach by  Executive,  the
Bank  and/or the  Holding  Company  will be  entitled,  in addition to any other
remedies and damages  available,  to an  injunction  to restrain  the  violation
hereof  by  Executive,   Executive's  partners,  agents,  servants,   employers,
employees and all persons acting for or with Executive. Executive represents and
admits  that in the  event of the  termination  of his  employment  pursuant  to
Sections 4(c) hereof,  Executive's  experience  and  capabilities  are such that
Executive can obtain employment in a business engaged in other lines and/or of a
different  nature  than  the  Bank  and/or  the  Holding  Company,  and that the
enforcement  of a remedy by way of injunction  will not prevent  Executive  from
earning a livelihood.  Nothing herein will be construed as prohibiting  the Bank
and/or the Holding  Company from  pursuing any other  remedies  available to the
Bank and/or the Holding Company for such breach or threatened breach,  including
the recovery of damages from Executive.

         (b) Executive  recognizes  and  acknowledges  that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof,  as it may exist from time to time,  is a valuable,  special and unique
asset of the business of the Bank.  Executive will not, during or after the term
of his  employment,  disclose  any  knowledge of the past,  present,  planned or
considered  business activities of the Bank or affiliates thereof to any person,
firm,  corporation,  or other  entity  for any  reason  or  purpose  whatsoever.
Notwithstanding the foregoing,  Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively  derived from the business  plans and activities of the Bank. In the
event of a breach or  threatened  breach by the  Executive of the  Provisions of
this  Section  10,  the  Bank  will be  entitled  to an  injunction  restraining
Executive  from  disclosing,  in whole or in part,  the  knowledge  of the past,
present,  planned or  considered  business  activities of the Bank or affiliates
thereof, or from rendering any services to any person, firm, corporation,  other
entity to whom such  knowledge,  in whole or in part,  has been  disclosed or is
threatened to be disclosed.  Nothing herein will be construed as prohibiting the
Bank from pursuing any other  remedies  available to the Bank for such breach or
threatened breach, including the recovery of damages from Executive.

11. SOURCE OF PAYMENTS

         All payments  provided m this Agreement shall be timely paid in cash or
check  from the  general  funds  of the  Bank.  The  Holding  Company,  however,
guarantees  payment and  provision of all amounts and benefits due  hereunder to
Executive  and, if such  amounts and  benefits  due from the Bank are not timely
paid or  provided  by the  Bank,  such  amounts  and  benefits  shall be paid or
provided by the Holding Company.

12. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLAN

         This Agreement  contains the entire  understanding  between the parties
hereto and supersedes  any prior  employment  agreement  between the Bank or any
predecessor  of the Bank and  Executive,  except that this  Agreement  shall not
affect or operate to reduce any benefit or compensation inuring to the Executive
of  a  kind  elsewhere  provided.  No  provision  of  this  Agreement  shall  be
interpreted to mean that  Executive is subject to receiving  fewer benefits than
those available to him without reference to this Agreement.

13. NO ATTACHMENT

         (a) Except as required by law, no right to receive  payments under this
Agreement  shall be  subject to  anticipation,  commutation,  alienation,  sale,
assignment,  encumbrance,  charge,  pledge, or  hypothecation,  or to execution,
attachment,  levy, or similar process or assignment by operation of law, and any
attempt,  voluntary  or  involuntary,  to affect any such action  shall be null,
void, and of no effect.

         (b) This Agreement  shall be binding upon, and inure to the benefit of,
Executive and the Bank and their respective successors and assigns.

14. MODIFICATION AND WAIVER

         (a)  This  Agreement  may  not be  modified  or  amended  except  by an
instrument in writing signed by the parties hereto.

         (b) No term or condition of this Agreement shall be deemed to have been
waived, nor shall there by any estoppel against the enforcement of any provision
of this Agreement,  except by written  instrument of the party charged with such
waiver or estoppel.  No such written waiver shall be deemed a continuing  waiver
unless specifically  stated therein,  and each such waiver shall operate only as
to the specific  term or condition  waived and shall not  constitute a waiver of
such term or condition for the future as to any act other than that specifically
waived.

15. REQUIRED PROVISIONS

         (a) The Bank may terminate the Executive's  employment at any time, but
any  termination  by the Bank,  other  than  Termination  for  Cause,  shall not
prejudice  Executive's  right to  compensation  or  other  benefits  under  this
Agreement.  Executive shall not have the right to receive  compensation or other
benefits  for any  period  after  Termination  for Cause as defined in Section ~
hereinabove.

         (b) If the  Executive  is  suspended  from  office  and/or  temporarily
prohibited from  participating  in the conduct of the Bank's affairs by a notice
served under Section 8(e)(3)(12U.S.C.  ss.ss. 1818 (e)(3)) or 8(g)(12 U.S.C. ss.
1818(g))  of the Federal  Deposit  Insurance  Act,  as amended by the  Financial
Institutions   Reform,   Recovery  and  Enforcement  Act  of  1989,  the  Bank's
obligations  under this  contract  shall be suspended as of the date of service,
unless  stayed by  appropriate  proceedings.  If the  charges  in the notice are
dismissed,  the Bank shall (i) pay the Executive all or part of the compensation
withheld while their contract  obligations were suspended and (ii) reinstate (in
whole or in part) any of the obligations which were suspended.

         (c) If the  Executive is removed  and/or  permanently  prohibited  from
participating  in the  conduct of the Bank's  affairs by an order  issued  under
Section  8(e)(12U.S.C.  ss.ss. 1818(e)) or 8(g) (12 U. S.C. ss. 1818 (g)) of the
Federal Deposit Insurance Act, as amended by the Financial  Institutions Reform,
Recovery and  Enforcement  Act of 1989,  all  obligations of the Bank under this
contract  shall  terminate  as of the  effective  date of the order,  but vested
rights of the contracting parties shall not be affected.

         (d) If the Bank is in default as defined in Section 3(x) (12 U.S.C. ss.
1813 (x)(l)) of the Federal  Deposit  Insurance Act, as amended by the Financial
Institutions  Reform,  Recovery and  Enforcement Act of 1989, all obligations of
the Bank under this contract shall terminate as of the date of default, but this
paragraph shall not affect any vested rights of the contracting parties.

         (e)  All   obligations  of  the  Bank  under  this  contract  shall  be
terminated, except to the extent determined that continuation of the contract is
necessary for the continued operation of the institution, by the Federal Deposit
Insurance  Corporation  ("FDIC"),  at the time FDIC enters into an  agreement to
provide assistance to or on behalf of the Bank under the authority  contained in
Section 13(c) (12 U.S.C. ss. 1823 (c)) of the Federal Deposit  Insurance Act, as
amended by the Financial  Institutions  Reform,  Recovery and Enforcement Act of
1982;  or when the Bank is  determined by the FDIC to be in an unsafe or unsound
condition.  Any rights of the parties that have already vested,  however,  shall
not be affected by such action.

16. SEVERABILITY

         If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this  Agreement or any part of such  provision not held so invalid,  and each
such other  provision and part thereof shall to the full extent  consistent with
law continue in full force and effect.

17. HEADINGS FOR REFERENCE ONLY

         The headings of sections and paragraphs  herein are included solely for
convenience of reference and shall not control the meaning or  interpretation of
any of the provisions of this Agreement.

18. GOVERNING LAW

         This Agreement  shall be governed by the laws of the State of Illinois,
but only to the extent not superseded by federal law.

19. ARBITRATION

         Any dispute or  controversy  arising under or in  connection  with this
Agreement  shall be settled  exclusively by  arbitration in accordance  with the
rules of the American  Arbitration  Association then in effect.  Judgment may be
entered on the arbitrator's  award in any court having  jurisdiction;  provided,
however,  that Executive  shall be entitled to seek specific  performance of his
right to be paid  until  the Date of  Termination  during  the  pendency  of any
dispute or controversy arising under or in connection with this Agreement.

20. PAYMENT OF LEGAL FEES

         All reasonable legal fees paid or incurred by Executive pursuant to any
dispute or question of  interpretation  relating to this Agreement shall be paid
or reimbursed by the Bank.

21. INDEMNIFICATION

         The Bank shall provide  Executive  (including his heirs,  executors and
administrators)   with  coverage  under  a  standard  directors'  and  officers'
liability insurance policy at its expense,  or in lieu thereof,  shall indemnify
Executive (and his heirs,  executors and  administrators)  to the fullest extent
permitted  under  federal law or state law against all expenses and  liabilities
reasonably incurred by him in connection with or arising out of any action, suit
or  proceeding  in which he may be  involved  by  reason  of his  having  been a
director or officer of the Bank (whether or not he continues to be a director or
officer at the time of incurring  such expenses or  liabilities),  such expenses
and liabilities to include,  but not be limited to, judgements,  court costs and
attorneys' fees and the cost of reasonable settlements (such settlements must be
approved  by the  Board of  Directors  of the  Bank).  If such  action,  suit or
proceeding  is  brought  against  Executive  in his  capacity  as an  officer or
director of the Bank, however,  such indemnification shall not extend to matters
as to which Executive is finally adjudged to be liable for willful misconduct in
the  performance  of his  duties.  No  Indemnification  shall be paid that would
violate 12 U.S.C. 1828 (k) or applicable regulations promulgated thereunder.

22. SUCCESSOR TO THE BANK

         The Bank shall  require any  successor or assignee,  whether  direct or
indirect,  by  purchase,   merger,   consolidation  or  otherwise,   to  all  or
substantially  all the  business or assets of the Bank or the  Holding  Company,
expressly  and  unconditionally  to  assume  and  agree to  perform  the  Bank's
obligations under this Agreement, in the same manner and to the same extent that
the Bank would be required to perform if no such  succession or  assignment  had
taken place.
<PAGE>

                                   SIGNATURES

         IN WITNESS  WHEREOF,  the Bank and the Holding Company have caused this
Agreement  to be executed  and their seals to be affixed  hereunto by their duly
authorized  officers,  and the Executive has signed this Agreement,  on the 17th
day of April, 1997.



ATTEST:                    CHARTER BANK, S.B.




                              By:




[SEAL]




ATTEST:                    CHARTER FINANCIAL, INC.

By: 
[SEAL]




WITNESS                   EXECUTIVE




                              By