(b) **Discretionary Bonus**. The Executive shall be entitled to participate in an equitablemanner with all other senior management employees of the Corporation in discretionary bonuses thatmay be authorized and declared by the Board of Directors to its senior management executives fromtime to time. No other compensation provided for in this Agreement shall be deemed a substitutefor the Executive’s right to participate in discretionary bonuses when and as declared by the Boardof Directors.(c) **Participation in Benefit and Retirement Plans**. The Executive shall be entitled toparticipate in and receive the benefits of any plan of the Corporation which may be or may becomeapplicable 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 toemployees and executives of the Corporation, to the extent commensurate with his then duties andresponsibilities, as fixed by the Board of Directors.(d) **Participation in Medical Plans and Insurance Policies**. The Executive shall be entitled toparticipate in and receive the benefits of any plan or policy of the Corporation which may be ormay become applicable to senior management relating to life insurance, short and long termdisability, medical, dental, eye-care, prescription drugs or medical reimbursement plans.Additionally, the Executive’s dependent family shall be eligible to participate in medical anddental insurance plans sponsored by the Corporation with the cost of such premiums paid by theCorporation.(e) **Vacations and Sick Leave**. The Executive shall be entitled to paid annual vacation leavein accordance with the policies as established from time to time by the Board of Directors, whichshall in no event be less than four weeks per annum. The Executive shall also be entitled to anannual sick leave benefit as established by the Board of Directors for senior management employeesof the Corporation. The Executive shall not be entitled to receive any additional compensationfrom the Corporation for failure to take a vacation or sick leave, nor shall he be able toaccumulate unused vacation or sick leave from one year to the next, except to the extent authorizedby the Board of Directors.(f) **Expenses**. The Corporation shall reimburse the Executive or otherwise provide for or payfor all reasonable expenses incurred by the Executive in furtherance of, or in connection with thebusiness of the Corporation, including, but not by way of limitation, automobile and travelingexpenses, and all reasonable entertainment expenses, subject to reasonable documentation and otherlimitations as may be established by the Board of Directors of the Corporation. If the expensesare paid in the first instance by the Executive, the Corporation shall reimburse the Executive forthose expenses.(g) **Changes in Benefits**. The Corporation shall not make any changes in plans, benefits orprivileges previously described in Section 3(c), (d) and (e) which would adversely affect theExecutive’s rights or benefits thereunder, unless the change occurs pursuant to a legalrequirement or a program applicable to all executive officers of the Corporation and does notresult in a proportionately greater adverse change in the rights of, or benefits to, the Executiveas compared with any other executive officer of the Corporation. Nothing paid to the Executiveunder any plan or arrangement presently in effect or made available in the future shall be deemedto be in lieu of the salary payable to the Executive pursuant to Section 3(a) hereof.
 
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4. **Loyalty; Noncompetition**.(a) The Executive shall devote his full time and attention to the performance of hisemployment under this Agreement. During the term of the Executive’s employment under thisAgreement, the Executive shall not engage in any business or activity contrary to the businessaffairs or interests of Eureka Bank (the “Bank”) or the Corporation.(b) Nothing contained in this Section 4 shall be deemed to prevent or limit the right of theExecutive to invest in the capital stock or other securities of any business dissimilar from thatof the Corporation, or, solely as a passive or minority investor, in any business.5. **Standards**. During the term of this Agreement, the Executive shall perform hisduties in accordance with reasonable standards expected of executives with comparable positions incomparable 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 Agreementshall be terminated upon any of the following occurrences:(a) The death of the Executive during the term of this Agreement, in which event theExecutive’s estate shall be entitled to receive the compensation due the Executive through the lastday of the calendar month in which the Executive’s death shall have occurred.(b) The Board of Directors may terminate the Executive’s employment at any time, but anytermination by the Board of Directors other than termination for Just Cause, shall not prejudicethe Executive’s right to compensation or other benefits under the Agreement. The Executive shallhave no right to receive compensation or other benefits for any period after termination for JustCause. The Board of Directors may within its sole discretion, acting in good faith, terminate theExecutive for Just Cause and shall notify the Executive accordingly. Termination for “Just Cause”shall include termination because of the Executive’s personal dishonesty, 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 similaroffenses) or final cease-and-desist order, or material breach of any provision of the Agreement.(c) Except as provided pursuant to Section 9 hereof, in the event the Executive’s employmentunder this Agreement is terminated by the Board of Directors without Just Cause, the Corporationshall be obligated to continue to pay the Executive the base salary provided pursuant to Section3(a) herein, up to the date of the end of the then remaining Term of this Agreement, but in noevent for a period of less than twelve months, and the cost of the Executive obtaining all health,life, disability, and other benefits which the Executive would be eligible to participate inthroughthat date based upon the benefit levels substantially equal to those being provided the Executiveat the date of termination of employment.
 
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(d) Notwithstanding the foregoing, in the event the Executive is a “Specified Employee” (asdefined herein) no payment shall be made to the Executive under sub-section 6(c) prior to the firstday of the seventh month following the Executive’s termination of employment in excess of the“permitted amount” under Section 409A of the Code. For these purposes the “permitted amount” shallbe an amount that does not exceed two times the lesser of: (A) the sum of the Executive’sannualized compensation based upon the annual rate of pay for services provided to the Corporationfor the calendar year preceding the year in which the Executive terminates his employment, or (B)the maximum amount that may be taken into account under a tax-qualified plan pursuant to Section401(a)(17) of the Internal Revenue Code of 1986, as amended (the “Code”) for the calendar year inwhich termination of employment occurs. The payment of the “permitted amount” shall be made withinsixty (60) days of the occurrence of the event of termination. Any payment in excess of thepermitted amount shall be made to the Executive on the first day of the seventh month following theevent of termination. “Specified Employee” shall be interpreted to comply with Section 409A of theCode and shall mean a key employee within the meaning of Section 416(i) of the Code (without regardto paragraph 5 thereof), but an individual shall be a “Specified Employee” only if the Corporationis a publicly-traded institution or the subsidiary of a publicly-traded holding company.(e) In the event the Executive voluntarily terminates his employment with the Corporationduring the term of this Agreement, the Executive shall be entitled to receive only thecompensation, vested rights, and all employee benefits due up to the date of termination.7. **Regulatory Exclusions**. Notwithstanding anything herein to the contrary, anypayments made to the Executive pursuant to the Agreement, or otherwise, shall be subject to andconditioned upon compliance with 12 USC 1828(k) and FDIC regulation C.F.R. Part 359 GoldenParachute and Indemnification Payments.8. **Disability**. If the Executive shall become disabled or incapacitated to the extentthat he is unable to perform his duties hereunder, by reason of medically determinable physical ormental impairment, as determined by a doctor engaged by the Board of Directors, the Executive shallnevertheless continue to receive the compensation and benefits provided under the terms of thisAgreement as follows: 100% of such compensation and benefits for a period of 12 months, but notexceeding the remaining term of the Agreement, and 65% thereafter for the remainder of the term ofthe Agreement. The benefits described herein shall be reduced by any benefits otherwise providedto the Executive during such period under the provisions of disability insurance coverage in effectfor the Bank or the Corporation. Thereafter, the Executive shall be eligible to receive benefitsprovided by the Corporation under the provisions of disability insurance coverage in effect forCorporation employees. Upon returning to active full-time employment, the Executive’s fullcompensation as set forth in this Agreement shall be reinstated as of the date of resumption of hisactivities. In the event that the Executive returns to active employment on other than a full-timebasis, then his compensation (as set forth in Section 3(a) of this Agreement) shall be reduced inproportion to the time spent in said employment, or as shall otherwise be agreed to by the parties.
 
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9. **Change in Control**.(a) Notwithstanding any provision herein to the contrary, in the event of the involuntarytermination of the Executive’s employment during the term of this Agreement following any Change inControl of the Bank or the Corporation, or within 24 months thereafter of the Change in Control,absent Just Cause, the Executive shall be paid an amount equal to the product of 2.999 times theExecutive’s “base amount” as defined in Section 280G(b)(3) of the Code and the regulationspromulgated thereunder. This amount shall be paid in equal installments over a 36-month periodcommencing within ten (10) days of the Executive’s termination of employment and shall be in lieuof any payments otherwise due under Section 6 of this Agreement. Notwithstanding the forgoing, allsums payable hereunder shall be reduced in a manner and to the extent so that no payments madehereunder when aggregated with all other payments to be made to the Executive by the Bank or theCorporation shall be deemed an “excess parachute payment” in accordance with Section 280G of theCode and be subject to the excise tax provided at Section 4999(a) of the Code. The term “Change inControl” shall refer to a change in ownership, change in effective control or change in ownershipof a substantial portion of assets, as determined for purposes of Section 409A of the Code and theregulations promulgated thereunder.(b) Notwithstanding any other provision of this Agreement to the contrary, the Executive mayvoluntarily terminate his employment during the term of this Agreement following a Change inControl of the Bank or the Corporation, or within twelve months following a Change in Control, andthe Executive shall thereupon be entitled to receive the payment described in Section 9(a) of thisAgreement, upon the occurrence, or within 120 days thereafter, of any of the following events,which have not been consented to in advance by the Executive in writing: (i) if the Executive wouldbe required to move his personal residence or perform his principal executive functions more thanthirty-five (35) miles from the Executive’s primary office as of the signing of this Agreement;(ii) if in the organizational structure of the Corporation, the Executive would be required toreport to a person or persons other than the Board of Directors of the Corporation;  (iii) if theCorporation should fail to maintain the Executive’s base compensation in effect as of the date ofthe Change in Control and the existing employee benefits plans, including material fringe benefit,stock option and retirement plans; (iv) if the Executive would be assigned duties andresponsibilities other than those normally associated with his position as referenced at Section 1,herein; (v) if the Executive’s responsibilities or authority have in any way been materiallydiminished or reduced; or (vi) if the Executive would not be reelected to the Board of Directors.(c) The Executive must give notice to the Corporation of the existence of one or more of theevents described in subsection (b) within sixty (60) days after the initial existence of the event,and the Corporation shall have thirty (30) days thereafter to remedy the event. In addition, theExecutive’s voluntary termination because of the existence of one or more of the events describedin subsection (b) must occur within six (6) months after the initial existence of the event.
 
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(d) Notwithstanding the foregoing, in the event the Executive is a “Specified Employee” (asdefined herein) no payment shall be made to the Executive under this Section 9 prior to the firstday of the seventh month following the Executive’s termination of employment in excess of the“permitted amount” under Section 409A of the Code. For these purposes the “permitted amount” shallbe an amount that does not exceed two times the lesser of: (A) the sumof the Executive’s annualized compensation based upon the annual rate of pay for services providedto the Corporation for the calendar year preceding the year in which the Executive terminates hisemployment, or (B) the maximum amount that may be taken into account under a tax-qualified planpursuant to Section 401(a)(17) of the Code for the calendar year in which termination of employmentoccurs. The payment of the “permitted amount” shall be made within sixty (60) days of theoccurrence of the event of termination. Any payment in excess of the permitted amount shall bemade to the Executive on the first day of the seventh month following the event of termination.“Specified Employee” shall be interpreted to comply with Section 409A of the Code and shall mean akey employee within the meaning of Section 416(i) of the Code (without regard to paragraph 5thereof), but an individual shall be a “Specified Employee” only if the Corporation is apublicly-traded institution or the subsidiary of a publicly-traded holding company.10. **Withholding**. All payments required to be made by the Corporation hereunder to theExecutive shall be subject to the withholding of such amounts, if any, relating to tax and otherpayroll deductions as the Corporation may reasonably determine should be withheld pursuant to anyapplicable law or regulation.11. **Successors and Assigns**.(a) This Agreement shall inure to the benefit of and be binding upon any corporate or othersuccessor of the Corporation which shall acquire, directly or indirectly, by merger, consolidation,purchase or otherwise, all or substantially all of the assets or stock of the Corporation.(b) Since the Corporation is contracting for the unique and personal skills of the Executive,the Executive shall be precluded from assigning or delegating his rights or duties hereunderwithout first obtaining the written consent of the Corporation.12. **Amendment; Waiver**. No provisions of this Agreement may be modified, waived ordischarged unless such waiver, modification or discharge is agreed to in writing, signed by theExecutive and such officer or officers as may be specifically designated by the Board of Directorsto sign on its behalf. No waiver by any party hereto at any time of any breach by any other partyhereto of, or compliance with, any condition or provision of this Agreement to be performed byanother party shall be deemed a waiver of similar or dissimilar provisions or conditions at thesame or at any prior or subsequent time.13. **Governing Law**. The validity, interpretation, construction and performance of thisAgreement shall be governed by the laws of the United States where applicable and otherwise by thesubstantive laws of the Commonwealth of Pennsylvania.14. **Nature of Obligations**. Nothing contained herein shall create or require theCorporation to create a trust of any kind to fund any benefits which may be payable hereunder, andto the extent that the Executive acquires a right to receive benefits from the Corporationhereunder, such right shall be no greater than the right of any unsecured general creditor of theCorporation.
 
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15. **Headings**. The section headings contained in this Agreement are for referencepurposes 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 theinvalidity or unenforceability of any provision of this Agreement shall not affect the validity orenforceability of the other provisions of this Agreement, which shall remain in full force andeffect.17. **Arbitration**. Any controversy or claim arising out of or relating to thisAgreement, or the breach thereof, shall be settled by arbitration in accordance with the rules thenin effect of the district office of the American Arbitration Association (“AAA”) nearest to thehome office of the Corporation, and judgment upon the award rendered may be entered in any courthaving jurisdiction thereof, except to the extent that the parties may otherwise reach a mutualsettlement of the issue. Further, the settlement of the dispute to be approved by the Board ofDirectors of the Corporation may include a provision for the reimbursement by the Corporation tothe Executive for all reasonable costs and expenses, including reasonable attorneys’ fees, arisingfrom the dispute, proceedings or actions, or the Board of Directors of the Corporation mayauthorize such reimbursement of such reasonable costs and expenses by separate action upon awritten action and determination of the Board of Directors following settlement of the dispute.The reimbursement shall be paid within ten (10) days of the Executive furnishing to the Corporationevidence, which may be in the form, among other things, of a canceled check or receipt, of anycosts or expenses incurred by the Executive.18. **Confidential Information**. The Executive acknowledges that during his employmenthe will learn and have access to confidential information regarding the Bank, the Corporation andits customers and businesses (“Confidential Information”). The Executive agrees and covenants notto disclose or use for his or her own benefit, or the benefit of any other person or entity, anyConfidential Information, unless or until the Bank or the Corporation consents to such disclosureor use or such information becomes common knowledge in the industry or is otherwise legally in thepublic domain. The Executive shall not knowingly disclose or reveal to any unauthorized person anyConfidential Information relating to the Bank, the Corporation or any subsidiaries or affiliates,or to any of the businesses operated by them, and the Executive confirms that such informationconstitutes the exclusive property of the Bank and the Corporation. The Executive shall nototherwise knowingly act or conduct himself (a) to the material detriment of the Bank or theCorporation, or its subsidiaries, or affiliates, or (b) in a manner which is inimical or contraryto the interests of the Bank or the Corporation. The Executive acknowledges and agrees that theexistence of this Agreement and its terms and conditions constitutes Confidential Information ofthe Bank or the Corporation, and the Executive agrees not to disclose the Agreement or its contentswithout the prior written consent of the Corporation. Notwithstanding the foregoing, theCorporation reserves the right in its sole discretion to make disclosure of this Agreement as itdeems necessary or appropriate in compliance with its regulatory reporting requirements.Notwithstanding anything herein to the contrary, failure by the Executive to comply with theprovisions of this Section 18 may result in the immediate termination of the Agreement within thesole discretion of the Corporation, disciplinary action against the Executive taken by theCorporation, including but not limited to the termination of employment of the Executive for breachof the Agreement and the provisions of this Section, and other remedies that may be available inlaw or in equity.
 
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19. **Source of Payments****.**Notwithstanding any provision in this Agreement to thecontrary, to the extent payments and benefits, as provided for under this Agreement, are paid orreceived by the Executive under an employment agreement in effect between the Executive and theBank, the payments and benefits paid by the Bank will be subtracted from any amount or benefit duesimultaneously to the Executive under similar provisions of this Agreement. Payments will beallocated in proportion to the level of activity and the time expended by the Executive onactivities related to the Corporation and the Bank, respectively, as determined by the Corporationand the Bank.20. **Entire Agreement**. This Agreement together with any understanding or modificationsthereof as agreed to in writing by the parties, shall constitute the entire agreement between theparties hereto.**[Signature page follows]**
 
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**IN WITNESS WHEREOF,**the parties have executed this Agreement onFebruary 28, 2011             **EUREKA FINANCIAL CORP.**           **ATTEST:**   By: /s/ Robert J. Malone           /s/ Barbara A. Rota                 Secretary                     By: /s/ Gary B. Pepper           **WITNESS:**     Gary B. Pepper  /s/ Rose Ann Mathas                 
 
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