EXHIBIT 10.1
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                              EMPLOYMENT AGREEMENT




         THIS AGREEMENT, entered into this 12th day of June 1997, by and between
First Carnegie  Deposit  (formerly First Federal  Savings & Loan  Association of
Carnegie),  a Federal stock savings bank,  (the "Bank") and Walter G. Kelly (the
"Executive").

                                   WITNESSETH

         WHEREAS,  the Executive has heretofore been employed by the Bank as the
President and Chief  Executive  Officer and is  experienced in all phases of the
business of the Bank; and

         WHEREAS,  the Bank desires to be ensured of the  Executive's  continued
active participation in the business of the Bank; and

         WHEREAS,  in order to induce the  Executive  to remain in the employ of
the Bank and in  consideration  of the  Executive's  agreeing  to  remain in the
employ of the Bank,  the  parties  desire to specify the  continuing  employment
relationship of the Bank and the Executive;

         NOW  THEREFORE,  in  consideration  of  the  premises  and  the  mutual
agreements herein contained, the parties hereby agree as follows:

         1. Employment. The Bank hereby employs the Executive in the capacity of
President  and Chief  Executive  Officer.  The  Executive  hereby  accepts  said
employment and agrees to render such  administrative and management  services to
the Bank and to Skibo  Bancshares,  M.H.C.,  the parent mutual  holding  company
("Parent") as are currently rendered and as are customarily performed by persons
situated  in a similar  executive  capacity.  The  Executive  shall  promote the
business of the Bank and Parent.  The Executive's  other duties shall be such as
the Board of Directors  for the Bank (the "Board of  Directors"  or "Board") may
from time to time reasonably  direct,  including  normal duties as an officer of
the Bank.

         2. Term of  Employment.  The term of  employment  under this  Agreement
shall be for three years,  commencing on the date of this Agreement and, subject
to the requirements of the succeeding sentence,  shall be deemed  automatically,
without further action,  to extend for an additional three (3) months at the end
of each  calendar  quarter,  so  that at any  time  the  remaining  term of this
Agreement  shall be from two and three quarter (2 3/4) years to three (3) years.
Prior to the end of each calendar quarter, the Board of Directors shall consider
and review (with appropriate corporate  documentation  thereof, and after taking
into  account  all  relevant  factors,  including  the  Executive's  performance
hereunder)  extension  of the term  under  this  Agreement,  and the term  shall
continue  to extend in the manner  set forth  above  unless  either the Board of
Directors  does not approve such  extension and provides  written  notice to the
Executive of such event or the Executive gives written notice to the Bank of his
election not to extend the term,


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in each case with such written notice to be given not less than thirty (30) days
prior  to any  such  calendar  quarter.  References  herein  to the term of this
Agreement shall refer both to the initial term and successive terms.

         3.    Compensation, Benefits and Expenses.

               (a) Base Salary.  The Bank shall compensate and pay the Executive
during the term of this  Agreement a minimum base salary at the rate of $144,685
per annum ("Base  Salary"),  payable in cash not less frequently than bi-weekly;
provided,  that  the  rate of such  salary  shall be  reviewed  by the  Board of
Directors not less often than annually,  and the Executive  shall be entitled to
receive  increases at such  percentages  or in such amounts as determined by the
Board of Directors. The base salary may not be decreased without the Executive's
express written consent.

               (b)  Discretionary  Bonus.  The  Executive  shall be  entitled to
participate in an equitable manner with all other senior management employees of
the Bank in  discretionary  bonuses that may be  authorized  and declared by the
Board of Directors to its senior  management  executives  from time to time.  No
other  compensation  provided for in this Agreement shall be deemed a substitute
for the Executive's right to participate in such discretionary  bonuses when and
as declared by the Board.

               (c)  Participation in Benefit and Retirement Plans. The Executive
shall be entitled to  participate in and receive the benefits of any plan of the
Bank which may be or may become  applicable  to senior  management  relating  to
pension or other  retirement  benefit  plans,  profit-sharing,  stock options or
incentive plans, or other plans,  benefits and privileges given to employees and
executives  of the Bank,  to the extent  commensurate  with his then  duties and
responsibilities, as fixed by the Board of Directors of the Bank.

               (d)  Participation in Medical Plans and Insurance  Policies.  The
Executive  shall be entitled to  participate  in and receive the benefits of any
plan or  policy  of the Bank  which may be or may  become  applicable  to senior
management relating to life insurance, short and long term disability,  medical,
dental, eye-care, prescription drugs or medical reimbursement plans.

               (e) Vacations and Sick Leave.  The Executive shall be entitled to
paid annual vacation leave in accordance  with the policies as established  from
time to time by the  Board of  Directors,  which  shall in no event be less than
four weeks per annum.  The  Executive  shall also be  entitled to an annual sick
leave benefit as established by the Board for senior management employees of the
Bank. The Executive shall not be entitled to receive any additional compensation
from the Bank for failure to take a vacation or sick leave, nor shall he be able
to accumulate unused vacation or sick leave from one year to the next, except to
the extent authorized by the Board of Directors.

               (f) Expenses. The Bank shall reimburse the Executive or otherwise
provide for or pay for all  reasonable  expenses  incurred by the  Executive  in
furtherance of, or in connection

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with  the  business  of the  Bank,  including,  but  not  by way of  limitation,
automobile and traveling  expenses,  and all reasonable  entertainment  expenses
(whether incurred at the Executive's  residence,  while traveling or otherwise),
subject  to  such  reasonable  documentation  and  other  limitations  as may be
established  by the Board of Directors of the Bank. If such expenses are paid in
the first  instance by the  Executive,  the Bank shall  reimburse  the Executive
therefor.

               (g) Changes in  Benefits.  The Bank shall not make any changes in
such plans, benefits or privileges previously described in Section 3(c), (d) and
(e) which would adversely affect the Executive's rights or benefits  thereunder,
unless such change  occurs  pursuant to a program  applicable  to all  executive
officers of the Bank and does not result in a  proportionately  greater  adverse
change in the rights of, or benefits  to, the  Executive  as  compared  with any
other executive officer of the Bank. Nothing paid to Executive under any plan or
arrangement  presently in effect or made available in the future shall be deemed
to be in lieu of the  salary  payable to  Executive  pursuant  to  Section  3(a)
hereof.

         4.    Loyalty; Noncompetition.

               (a) The Executive shall devote his full time and attention to the
performance  of his  employment  under  this  Agreement.  During the term of the
Executive's  employment under this Agreement,  the Executive shall not engage in
any  business or activity  contrary to the  business  affairs or interest of the
Bank or Parent.

               (b)  Nothing  contained  in this  Section  4 shall be  deemed  to
prevent or limit the right of Executive to invest in the capital  stock or other
securities  of any  business  dissimilar  from that of the Bank or  Parent,  or,
solely as a passive or minority investor, in any business.

         5. Standards.  During the term of this  Agreement,  the Executive shall
perform his duties in  accordance  with such  reasonable  standards  expected of
executives with comparable  positions in comparable  organizations and as may be
established from time to time by the Board of Directors.

         6.  Termination and Termination  Pay. The Executive's  employment under
this Agreement shall be terminated upon any of the following occurrences:

               (a) The death of the Executive during the term of this Agreement,
in  which  event  the  Executive's  estate  shall be  entitled  to  receive  the
compensation  due the  Executive  through the last day of the calendar  month in
which Executive's death shall have occurred.

               (b)  The  Board  of  Directors  may  terminate  the   Executive's
employment at any time, but any termination by the Board of Directors other than
termination  for Just  Cause,  shall  not  prejudice  the  Executive's  right to
compensation or other benefits under the Agreement.  The Executive shall have no
right to receive compensation or other benefits for any period after termination
for Just Cause. The Board may within its sole discretion,  acting in good faith,
terminate  the  Executive  for  Just  Cause  and  shall  notify  such  Executive
accordingly. Termination

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for "Just Cause" shall include termination  because of the Executive's  personal
dishonesty, incompetence, willful misconduct, 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 provision
of the Agreement.

               (c) Except as provided pursuant to Section 9 herein, in the event
Executive's  employment  under  this  Agreement  is  terminated  by the Board of
Directors without Just Cause, the Bank shall be obligated to continue to pay the
Executive the salary provided pursuant to Section 3(a) herein, up to the date of
termination  of  the  remaining  term  (including  any  renewal  term)  of  this
Agreement, but in no event for a period of less than twelve months, and the cost
of Executive obtaining all health,  life,  disability,  and other benefits which
the Executive  would be eligible to  participate in through such date based upon
the benefit levels  substantially equal to those being provided Executive at the
date of termination of employment.

               (d) If the  Executive is removed  and/or  permanently  prohibited
from participating in the conduct of the Bank's affairs by an order issued under
Sections  8(e)(4) or 8(g)(1) of the Federal  Deposit  Insurance Act ("FDIA") (12
U.S.C.  1818(e)(4) and (g)(1)), all obligations of the Bank under this Agreement
shall terminate, as of the effective date of the order, but the vested rights of
the parties shall not be affected.

               (e) If the Bank is in default (as  defined in Section  3(x)(1) of
FDIA) all  obligations  under this Agreement  shall  terminate as of the date of
default,  but  this  paragraph  shall  not  affect  any  vested  rights  of  the
contracting parties.

               (f) All  obligations  under this  Agreement  shall be terminated,
except to the extent determined that continuation of this Agreement is necessary
for the  continued  operation of the Bank:  (i) by the Director of the Office of
Thrift Supervision ("Director of OTS"), or his or her designee, at the time that
the Federal Deposit Insurance  Corporation  ("FDIC") enters into an agreement to
provide assistance to or on behalf of the Bank under the authority  contained in
Section  13(c)  of  FDIA;  or (ii) by the  Director  of the  OTS,  or his or her
designee,  at the time  that the  Director  of the OTS,  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  of the OTS 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.

               (g) The voluntary termination by the Executive during the term of
this  Agreement  with the delivery of no less than 30 days written notice to the
Board of  Directors,  other than  pursuant  to Section  9(b),  in which case the
Executive shall be entitled to receive only the compensation, vested rights, and
all employee benefits up to the date of such termination.

               (h) Notwithstanding anything herein to the contrary, any payments
made to the Executive pursuant to the Agreement, or otherwise,  shall be subject
to and  conditioned  upon  compliance with 12 USC ss.1828(k) and any regulations
promulgated thereunder.

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         7.  Suspension  of  Employment.  If the  Executive is suspended  and/or
temporarily  prohibited from  participating in the conduct of the Bank's affairs
by a notice  served  under  Section  8(e)(3)  or (g)(1)  of the FDIA (12  U.S.C.
1818(e)(3)  and (g)(1)),  the Bank's  obligations  under the Agreement  shall be
suspended as of the date of service,  unless stayed by appropriate  proceedings.
If the charges in the notice are  dismissed,  the Bank may within its discretion
(i)  pay  the  Executive  all or part of the  compensation  withheld  while  its
contract  obligations  were suspended and (ii) reinstate any of its  obligations
which were suspended.

         8. Disability.  If the Executive shall become disabled or incapacitated
to the extent  that he is unable to perform his duties  hereunder,  by reason of
medically determinable physical or mental impairment,  as determined by a doctor
engaged by the Board of  Directors,  Executive  shall  nevertheless  continue to
receive the compensation and benefits provided under the terms of this Agreement
as follows:  100% of such  compensation  and benefits for a period of 12 months,
but not exceeding the remaining  term of the  Agreement,  and 65% thereafter for
the remainder of the term of the Agreement.  Such benefits noted herein shall be
reduced by any benefits  otherwise  provided to the Executive during such period
under the  provisions  of  disability  insurance  coverage  in  effect  for Bank
employees.  Thereafter, Executive shall be eligible to receive benefits provided
by the Bank under the provisions of disability  insurance coverage in effect for
Bank employees.  Upon returning to active full-time employment,  the Executive's
full  compensation  as set forth in this Agreement shall be reinstated as of the
date of commencement of such activities. In the event that the Executive returns
to active  employment on other than a full-time basis, then his compensation (as
set forth in Section 3(a) of this  Agreement)  shall be reduced in proportion to
the time spent in said  employment,  or as shall  otherwise  be agreed to by the
parties.

         9.    Change in Control.

               (a) Notwithstanding any provision herein to the contrary,  in the
event of the involuntary  termination of Executive's  employment during the term
of this Agreement following any change in control of the Bank or Parent,  absent
Just Cause, Executive shall be paid an amount equal to the product of 2.99 times
the Executive's  "base amount" as defined in Section  280G(b)(3) of the Internal
Revenue  Code of 1986,  as amended  (the  "Code")  and  regulations  promulgated
thereunder.  Said sum shall be paid, at the option of  Executive,  either in one
(1) lump sum  within  thirty  (30) days of such  termination  discounted  to the
present value of such payment using as the discount rate the Applicable  Federal
Rate  specified at Section 280G of the Code,  or in periodic  payments  over the
next 36 months or the remaining term of this Agreement  whichever is less, as if
Executive's  employment had not been  terminated,  and such payments shall be in
lieu of any  other  future  payments  which  the  Executive  would be  otherwise
entitled  to receive  under  Section 6 of this  Agreement.  Notwithstanding  the
forgoing, all sums payable hereunder shall be reduced in such manner and to such
extent so that no such payments made  hereunder when  aggregated  with all other
payments to be made to the  Executive  by the Bank or the Parent shall be deemed
an "excess parachute payment" in accordance with Section 280G of the Code and be
subject to the  excise tax  provided  at Section  4999(a) of the Code.  The term
"control"  shall refer to the ownership,  holding or power to vote more than 25%
of the Parent's

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or Bank's  voting  stock,  the  control of the  election  of a  majority  of the
Parent's or Bank's  directors,  or the exercise of a controlling  influence over
the  management  or  policies  of the Parent or Bank by any person or by persons
acting as a group within the meaning of Section 13(d) of the Securities Exchange
Act of 1934. The term "person" means an individual other than the Executive,  or
a corporation,  partnership, trust, association, joint venture, pool, syndicate,
sole proprietorship, unincorporated organization or any other form of entity not
specifically listed herein.

               (b)  Notwithstanding any other provision of this Agreement to the
contrary,  Executive may voluntarily terminate his employment during the term of
this  Agreement  following  a  change  in  control  of the Bank or  Parent,  and
Executive  shall  thereupon  be entitled to receive  the  payment  described  in
Section 9(a) of this Agreement,  upon the occurrence, or within ninety (90) days
thereafter,  of any of the following events, which have not been consented to in
advance by the Executive in writing:  (i) if Executive would be required to move
his personal  residence or perform his principal  executive  functions more than
twenty-five (25) miles from the Executive's  primary office as of the signing of
this Agreement;  (ii) if in the organizational  structure of the Bank, Executive
would be  required  to  report to a person or  persons  other  than the Board of
Directors  of the Bank;  (iii) if the Bank should  fail to maintain  Executive's
base  compensation  in effect as of the date of the  Change in  Control  and the
existing  employee  benefits plans,  including  material  fringe benefit,  stock
option and  retirement  plans;  (iv) if Executive  would be assigned  duties and
responsibilities  other than those  normally  associated  with his  position  as
referenced  at  Section  1,  herein;  (v)  if  Executive's  responsibilities  or
authority  have in any way been  materially  diminished  or reduced;  or (vi) if
Executive would not be reelected to the Board of Directors of the Bank.

        10. Withholding.  All payments required to be made by the Bank hereunder
to the Executive  shall be subject to the  withholding of such amounts,  if any,
relating  to tax  and  other  payroll  deductions  as the  Bank  may  reasonably
determine should be withheld pursuant to any applicable law or regulation.

        11.    Successors and Assigns.

               (a) This  Agreement  shall inure to the benefit of and be binding
upon any corporate or other successor of the Bank or Parent which shall acquire,
directly or indirectly, by merger, consolidation,  purchase or otherwise, all or
substantially all of the assets or stock of the Bank or Parent.

               (b) Since the Bank is  contracting  for the unique  and  personal
skills of the  Executive,  the Executive  shall be precluded  from  assigning or
delegating his rights or duties  hereunder  without first  obtaining the written
consent of the Bank.

        12. Amendment;  Waiver. No provisions of this Agreement may be modified,
waived or discharged unless such waiver,  modification or discharge is agreed to
in  writing,  signed by the  Executive  and such  officer or  officers as may be
specifically  designated  by the Board of  Directors  of the Bank to sign on its
behalf. No waiver by any party hereto at any time of any

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breach by any other  party  hereto of, or  compliance  with,  any  condition  or
provision of this  Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.

        13.  Governing  Law.  The  validity,  interpretation,  construction  and
performance of this Agreement shall be governed by the laws of the United States
where  applicable and otherwise by the substantive  laws of the  Commonwealth of
Pennsylvania.

        14.  Nature of  Obligations.  Nothing  contained  herein shall create or
require the Bank to create a trust of any kind to fund any benefits which may be
payable  hereunder,  and to the extent  that the  Executive  acquires a right to
receive  benefits from the Bank  hereunder,  such right shall be no greater than
the right of any unsecured general creditor of the Bank.

        15. Headings.  The section headings  contained in this Agreement are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation of this Agreement.

        16.  Severability.  The  provisions  of this  Agreement  shall be deemed
severable  and the  invalidity  or  unenforceability  of any  provision  of this
Agreement  shall  not  affect  the  validity  or  enforceability  of  the  other
provisions of this Agreement, which shall remain in full force and effect.

        17. Arbitration.  Any controversy or claim arising out of or relating to
this  Agreement,  or the breach  thereof,  shall be settled  by  arbitration  in
accordance  with the rules then in effect of the district office of the American
Arbitration  Association  ("AAA")  nearest to the home  office of the Bank,  and
judgment upon the award rendered may be entered in any court having jurisdiction
thereof,  except to the extent  that the parties  may  otherwise  reach a mutual
settlement of such issue.  Further, the settlement of the dispute to be approved
by the Board of the Bank may include a provision  for the  reimbursement  by the
Bank  to  the  Executive  for  all  reasonable  costs  and  expenses,  including
reasonable  attorneys' fees, arising from such dispute,  proceedings or actions,
or the Board of the Bank or the Parent may authorize such  reimbursement of such
reasonable  costs and  expenses  by separate  action  upon a written  action and
determination   of  the  Board  following   settlement  of  the  dispute.   Such
reimbursement shall be paid within ten (10) days of Executive  furnishing to the
Bank or Parent  evidence,  which may be in the form,  among other  things,  of a
canceled check or receipt, of any costs or expenses incurred by Executive.

        18. Entire Agreement.  This Agreement together with any understanding or
modifications  thereof as agreed to in writing by the parties,  shall constitute
the entire agreement between the parties hereto.



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