SECURITY FEDERAL BANK & TRUST
                              EMPLOYMENT AGREEMENT


         This AGREEMENT ("Agreement") is made effective as of March 29, 2001, by
and among Security Federal Bank & Trust (the "Bank"), a federally chartered
stock savings bank, with its principal administrative office at 9321 Wicker
Avenue, St. John, Indiana 46373, Security Financial Bancorp, Inc., a corporation
organized under the laws of the State of Delaware, the holding company for the
Bank (the "Holding Company"), and Patrick J. Hunt ("Executive").

         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 Chief Financial Officer of the Bank. Executive shall render
administrative and management services to the Bank such as are customarily
performed by persons situated in a similar executive capacity.

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 twenty-four (24) full calendar months thereafter. Commencing on
the first anniversary date of this Agreement, and continuing on each anniversary
thereafter, the disinterested members of the board of directors of the Bank
("Board") may extend the Agreement an additional year such that the remaining
term of the Agreement shall be twenty-four (24) months unless Executive elects
not to extend the term of this Agreement by giving written notice in accordance
with Section 8 of this Agreement. The Board will review the Agreement and
Executive's performance annually for purposes of determining whether to extend
the Agreement and the rationale and results thereof shall be included in the
minutes of the Board's meeting. The Board shall give notice to Executive as soon
as possible after such review as to whether the Agreement is to be extended.

         (b) During the period of Executive's 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 and participation in community and civic
organizations; provided, however, that, with the approval of the Board, as
evidenced by a resolution of the 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,


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which, in the 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.

         (c) Notwithstanding anything herein to the contrary, Executive's
employment with the Bank may be terminated by the Bank or Executive at any time
during the term of this Agreement, subject to the terms and conditions of this
Agreement.

3.       COMPENSATION AND REIMBURSEMENT.

         (a) The Bank shall pay Executive as compensation a salary of $93,000
per year ("Base Salary"). Base Salary shall include any amounts of compensation
deferred by Executive under any tax-qualified retirement or welfare benefit plan
or any other deferred compensation arrangement maintained by the Bank. Base
Salary shall be payable in accordance with the regular payroll practices of the
Bank. 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 one
year from the date of this Agreement. Such review shall be conducted by the
Board or by a Committee of the Board, delegated such responsibility by the
Board. The Committee or the Board may increase Executive's Base Salary at any
time. Any increase in Base Salary shall become "Base Salary" for purposes of
this Agreement. In addition to Base Salary provided in this Section 3(a), the
Bank shall also provide Executive, at no premium cost to Executive, with all
such other benefits as are provided uniformly to permanent full-time employees
of the Bank. In addition, Executive shall be entitled to incentive compensation
and bonuses as provided in any plan or arrangement of the Bank in which
Executive is eligible to participate.

         (b) Executive shall be entitled to participate in or receive benefits
under all plans relating to stock options, restricted stock awards, stock
purchases, pension, thrift, supplemental retirement, profit-sharing, employee
stock ownership, group life insurance, medical and other health and welfare
coverage, education, cash or stock bonuses that are now or hereafter made
available by the Bank 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. Nothing paid to Executive under
any such plan or arrangement will be deemed to be in lieu of other compensation
to which Executive is entitled under this Agreement.

         (c) The Bank shall pay or reimburse Executive for all reasonable
expenses incurred by Executive performing his obligations under this Agreement
and may provide such additional compensation in such form and such amounts as
the Board may from time to time determine.

4.       PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION.

         (a) Upon the occurrence of an Event of Termination (as herein defined)
during 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 include any one or more of the following: (i) the termination by
the Bank of Executive's full-time employment hereunder for any reason other than
a termination governed by Section 5(a) hereof, or Termination for Cause, as
defined in Section 7 hereof; (ii) Executive's resignation from the Bank's employ
upon any (A) 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

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position and attributes thereof described in Section 1, above, unless consented
to by Executive, (B) relocation of Executive's principal place of employment by
more than 25 miles from its location at the effective date of this Agreement,
unless consented to by Executive, (C) material reduction in the benefits and
perquisites to Executive from those being provided as of the effective date of
this Agreement, unless consented to by Executive, (D) a 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 not less than sixty (60)
days prior written notice given within six full months after the event giving
rise to said right to elect.

         (b) Upon the occurrence of an Event of Termination, on the Date of
Termination, as defined in Section 8, the Bank shall be obligated to pay
Executive, or, in the event of his subsequent death, his beneficiary or
beneficiaries, or his estate, as the case may be a sum equal to the sum of: (i)
Base Salary and bonuses in accordance with Section 3(a) of this Agreement that
would have been paid to Executive for the remaining term of this Agreement had
the Event of Termination not occurred; and (ii) all benefits, including health
insurance in accordance with Section 3(b) that would have been provided to
Executive for the remaining term of the this Agreement had an Event of
Termination not occurred; PROVIDED, HOWEVER, that any payments pursuant to this
subsection and subsection 4(c) below shall not, in the aggregate, exceed three
times Executive's average annual compensation for the five most recent taxable
years that Executive has been employed by the Bank or such lesser number of
years in the event that Executive shall have been employed by the Bank for less
than five years. In the event the Bank is not in compliance with its minimum
capital requirements or if such payments pursuant to this subsection (b) would
cause the Bank's capital to be reduced below its minimum regulatory capital
requirements, such payments shall be deferred until such time as the Bank or
successor thereto is in capital compliance. At the election of Executive, which
election is to be made prior to an Event of Termination, such payments shall be
made in a lump sum as of Executive's Date of Termination. In the event that no
election is made, payment to Executive will be made on a monthly basis in
approximately equal installments during the remaining term of the Agreement.
Such payments shall not be reduced in the event Executive obtains other
employment following termination of employment.

         (c) Upon the occurrence of an Event of Termination, the Bank will cause
to be continued life, medical, dental and disability coverage substantially
identical to the coverage maintained by the Bank or the Holding Company for
Executive prior to his termination at no premium cost to Executive, except to
the extent such coverage may be changed in its application to all Bank or
Holding Company employees. Such coverage shall cease upon the expiration of the
remaining term of this Agreement.

5.       CHANGE IN CONTROL.

         (a) For purposes of this Agreement, a "Change in Control" of the Bank
or Holding Company shall mean an event of a nature that: (i) would be required
to be reported in response to Item 1 of the current report on Form 8-K, as in
effect on the date hereof, pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"); or (ii) results in a
Change in Control of the Bank or the Holding Company within the meaning of the
Home

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Owners' Loan Act of 1933, as amended, the Federal Deposit Insurance Act and the
Rules and Regulations promulgated by the Office of Thrift Supervision ("OTS")
(or its predecessor agency), as in effect on the date hereof (provided, that in
applying the definition of Change in Control as set forth under the rules and
regulations of the OTS, the Board shall substitute its judgment for that of the
OTS); or (iii) without limitation such a Change in Control shall be deemed to
have occurred at such time as (A) any "person" (as the term is used in Sections
13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of voting
securities of the Bank or the Holding Company representing 25% or more of the
Bank's or the Holding Company's outstanding voting securities or right to
acquire such securities except for any voting securities of the Bank purchased
by the Holding Company and any voting securities purchased by any employee
benefit plan of the Bank or the Holding Company, or (B) individuals who
constitute the Board on 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-quarters of the directors comprising the Incumbent
Board, or whose nomination for election by the Holding Company's stockholders
was approved by the same Nominating Committee serving under an Incumbent Board,
shall be, for purposes of this clause (B), considered as though he were a member
of the Incumbent Board, or (C) a plan of reorganization, merger, consolidation,
sale of all or substantially all the assets of the Bank or the Holding Company
or similar transaction occurs in which the Bank or Holding Company is not the
resulting entity; provided, however, that such an event listed above will be
deemed to have occurred or to have been effectuated upon the receipt of all
required regulatory approvals not including the lapse of any statutory waiting
periods.

         (b) If a Change in Control has occurred pursuant to Section 5(a) or the
Board has determined that a Change in Control has occurred, Executive shall be
entitled to the benefits provided in paragraphs (c) and (d) of this Section 5
upon his subsequent termination of employment at any time during the term of
this Agreement due to: (1) Executive's dismissal or (2) Executive's voluntary
resignation during the twelve (12) month period following the date of the Change
in Control following any demotion, loss of title, office or significant
authority or responsibility, material reduction in annual compensation or
benefits or relocation of his principal place of employment by more than 25
miles from its location immediately prior to the Change in Control, unless such
termination is because of his death, disability, retirement or Termination for
Cause.

         (c) Upon Executive's entitlement to benefits pursuant to Section 5(b),
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 sum equal to
the greater of: (1) Base Salary and bonuses in accordance with Section 3(a) of
this Agreement that would have been paid to Executive for the remaining term of
this Agreement had the event described in Subsection (b) of this Section 5 not
occurred and all benefits, including health insurance, in accordance with
Section 3(b) that would have been provided to Executive for the remaining term
of this Agreement had the event described in Subsection (b) of this Section 5
not occurred; or (2) three (3) times Executive's Average Annual Compensation (as
defined herein) for the five (5) most recent taxable years that Executive has
been employed by the Bank or such lesser number of years in the event that
Executive shall have been employed by the Bank for less than five (5) years.
Such "Average Annual Compensation" shall include all taxable income paid by the
Bank, including but not

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limited to, Base Salary, commissions, and bonuses, as well as contributions on
Executive's behalf to any pension and/or profit sharing plan, retirement
payments, directors or committee fees and fringe benefits paid or to be paid to
Executive in any such year; PROVIDED, HOWEVER, that any payment under this
provision and subsection 5(d) below shall not exceed three (3) times Executive's
Average Annual Compensation. In the event 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 regulatory capital requirements, such payments
shall be deferred until such time as the Bank or successor thereto is in capital
compliance. At the election of Executive, which election is to be made prior to
a Change in Control, such payment shall be made in a lump sum as of Executive's
Date of Termination. In the event that no election is made, payment to Executive
will be made in approximately equal installments on a monthly basis over a
period of thirty-six (36) months following Executive's termination. Such
payments shall not be reduced in the event Executive obtains other employment
following termination of employment.

         (d) Upon Executive's entitlement to benefits pursuant to Section 5(b),
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 at no premium cost to Executive, except to the
extent that such coverage may be changed in its application for all Bank
employees on a non-discriminatory basis. Such coverage and payments shall cease
upon the expiration of twenty-four (24) months following the Date of
Termination.

6.       CHANGE OF CONTROL RELATED PROVISIONS

         Notwithstanding the provisions of Section 5, in no event shall the
aggregate payments or benefits to be made or afforded to Executive under said
paragraphs (the "Termination Benefits") constitute an "excess parachute payment"
under Section 280G of the Internal Revenue Code of 1986, as amended, or any
successor thereto, and in order to avoid such a result, Termination Benefits
will be reduced, if necessary, to an amount (the "Non-Triggering Amount"), the
value of which is one dollar ($1.00) less than an amount equal to three (3)
times Executive's "base amount," as determined in accordance with said Section
280G. The allocation of the reduction required hereby among the Termination
Benefits provided by Section 5 shall be determined by Executive.

7.       TERMINATION FOR CAUSE.

         The term "Termination for Cause" shall mean termination because of
Executive's personal dishonesty, incompetence, willful misconduct, 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 provision of this Agreement. Notwithstanding the foregoing,
Executive shall not be deemed to have been Terminated for Cause unless and until
there shall have been delivered to his a Notice of Termination which shall
include a copy of a resolution duly adopted by the affirmative vote of not less
than a majority 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 his, 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.
Executive shall not have the right to receive

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compensation or other benefits for any period after the Date of Termination for
Cause. During the period beginning on the date of the Notice of Termination for
Cause pursuant to Section 8 hereof through the Date of Termination for Cause,
stock options and related limited rights granted to Executive under any stock
option plan shall not be exercisable nor shall any unvested awards granted to
Executive under any stock benefit plan of the Bank, the Holding Company or any
subsidiary or affiliate thereof, vest. At the Date of Termination for Cause,
such stock options and related limited rights and any unvested awards shall
become null and void and shall not be exercisable by or delivered to 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
provide a basis for termination of Executive's employment under the provision so
indicated.

         (b) "Date of Termination" shall mean 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, 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 therefrom 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, in the event Executive is terminated for
            reasons other than Termination for Cause, the Bank will continue to
            pay Executive his Base Salary in effect when the notice giving rise
            to the dispute was given until the earlier of: 1) the resolution of
            the dispute in accordance with this Agreement or 2) the expiration
            of the remaining term of this Agreement as determined as of the Date
            of Termination. 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.

         All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with this Section 9 for one (1) full year
after the earlier of the expiration of this Agreement or termination of
Executive's employment with the Bank. Executive shall,

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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 AND NON-DISCLOSURE OF BANK BUSINESS.

         (a) Upon any termination of Executive's employment hereunder pursuant
to Section 4 hereof, Executive agrees not to compete with the Bank for a period
of one (1) year following such termination in any city, town or county in which
Executive's normal business office is located and the Bank 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 otherwise serve with, directly or indirectly, any entity
whose business materially competes with the depository, lending or other
business activities of the Bank. The parties hereto, recognizing that
irreparable injury will result to the Bank, its business and property 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 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, employees and all
persons acting for or under the direction of Executive. 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.

         (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. Further, Executive
            may disclose information regarding the business activities of the
            Bank to the OTS and the Federal Deposit Insurance Corporation
            ("FDIC") pursuant to a formal regulatory request. In the event of a
            breach or threatened breach by Executive of the provisions of this
            Section, 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, or 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.

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         All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank. The Holding Company, however,
unconditionally 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 PLANS.

         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 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 his 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 be 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.

         In the event any of the foregoing provisions of this Section 15 are in
conflict with the terms of this Agreement, this Section 15 shall prevail.

         (a) The Bank may terminate 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

<PAGE>

receive compensation or other benefits for any period after Termination for
Cause as defined in Section 7 hereinabove.

         (b) If 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) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
ss.1818(e)(3) or (g)(1); 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 may in its discretion: (i)
pay 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 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)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
ss.1818(e)(4) or (g)(1), 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)(1) of the
Federal Deposit Insurance Act, 12 U.S.C. ss.1813(x)(1) 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: (i) by the Director of
the OTS (or his designee), the FDIC or the Resolution Trust Corporation, at the
time the FDIC 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, 12 U.S.C. ss.1823(c); or (ii) by the Director of the OTS (or his
designee) at the time the Director (or his designee) approves a supervisory
merger to resolve problems related to the operations of the Bank or when the
Bank is determined by the Director 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.

         (f) Any payments made to Executive pursuant to this Agreement, or
otherwise, are subject to and conditioned upon compliance with 12
U.S.C.ss.1828(k) and 12 C.F.R. Section 545.121 and any rules and regulations
promulgated thereunder.

16.      REINSTATEMENT OF BENEFITS UNDER SECTION 15(b).

         In the event Executive is suspended and/or temporarily prohibited from
participating in the conduct of the Bank's affairs by a notice described in
Section 15(b) hereof (the "Notice") during the term of this Agreement and a
Change in Control, as defined herein, occurs, the Bank will assume its
obligation to pay and Executive will be entitled to receive all of the
termination benefits provided for under Section 5 of this Agreement upon the
Bank's receipt of a dismissal of charges in the Notice.

<PAGE>

17.      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.

18.      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.

19.      GOVERNING LAW.

         The validity, interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the State of Indiana, without regards
to principles of conflicts of law of this state, but only to the extent not
superseded by federal law.

20.      ARBITRATION.

         Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration, conducted before a panel
of three arbitrators sitting in a location selected by Executive within fifty
(50) miles from the location of the Bank, 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.

         In the event any dispute or controversy arising under or in connection
with Executive's termination is resolved in favor of Executive, whether by
judgment, arbitration or settlement, Executive shall be entitled to the payment
of all back-pay, including salary, bonuses and any other cash compensation,
fringe benefits and any compensation and benefits due Executive under this
Agreement.

21.      PAYMENT OF COSTS AND LEGAL FEES.

         All reasonable costs and 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 if Executive is successful on the merits
pursuant to a legal judgment, arbitration or settlement.


22.      INDEMNIFICATION.

         (a) The Bank shall provide Executive (including his heirs, executors
and administrators) with coverage under a standard directors' and officers'
liability insurance policy at

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its expense and shall indemnify Executive (and his heirs, executors and
administrators) as permitted under federal law against all expenses and
liabilities reasonably incurred by his 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, judgments, court
costs and attorneys' fees and the cost of reasonable settlements.

         (b) Any payments made to Executive pursuant to this Section are subject
to and conditioned upon compliance with 12 U.S.C.ss.1828(k) and 12 C.F.R.
Section 545.121 and any rules or regulations promulgated thereunder.

23.      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.

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                                   SIGNATURES


         IN WITNESS WHEREOF, Security Federal Bank & Trust and Security
Financial Bancorp, Inc. have caused this Agreement to be executed and their
seals to be affixed hereunto by their duly authorized officers and directors,
and Executive has signed this Agreement, on March 29, 2001.


ATTEST:                                     SECURITY FEDERAL BANK & TRUST



                                            By: /s/ John P. Hyland
                                               ---------------------------
                                               John P. Hyland
                                               For the Entire Board of Directors



         [SEAL]


ATTEST:                                     SECURITY FINANCIAL BANCORP, INC.
                                                         (Guarantor)



                                            By: /s/ John P. Hyland
                                               ---------------------------
                                               John P. Hyland
                                               For the Entire Board of Directors

         [SEAL]


WITNESS:                                             EXECUTIVE


                                               /s/ Patrick J. Hunt
                                               ---------------------------------
                                               Patrick J. Hunt