AMENDED AND RESTATED EMPLOYMENT AGREEMENT


     This Amended and Restated  Employment  Agreement (the  "Agreement") is made
effective as of September 30, 2008 (the "Effective  Date"),  by and between ESSA
Bank & Trust,  a  Pennsylvania  chartered  stock  savings  association  with its
principal office in Stroudsburg, Pennsylvania (the "Bank"), ESSA Bancorp, Inc. a
Pennsylvania  corporation  that owns 100% of the  common  stock of the Bank (the
"Company"),  and Gary S. Olson  ("Executive").  Any reference to the  "Employer"
shall mean both the Company and the Bank.

     WHEREAS,  the  Executive  is  currently  employed  as  President  and Chief
Executive Officer of the Employer  pursuant to an employment  agreement that was
effective March 31, 2007 (the "Original Agreement"); and

     WHEREAS,  the Employer desires to amend and restate the Original  Agreement
in order to make  changes  to comply  with the final  regulations  issued  under
Section 409A of the Internal  Revenue Code of 1986, as amended (the "Code"),  in
April, 2007; and

     WHEREAS,  Executive  is  willing  to serve  the  Employer  on the terms and
conditions hereinafter set forth and has agreed to such changes; and

     WHEREAS,  the Board of Directors of the Employer and the Executive  believe
it is in the best interests of the Employer to enter into the Agreement in order
to reinforce  and reward the  Executive  for his service and  dedication  to the
continued  success of the Employer and incorporate  the changes  required by the
final regulations under Code Section 409A.

     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
President  and  Chief   Executive   Officer  of  the  Employer  (the  "Executive
Position"). Executive shall be responsible for the overall management, and shall
be responsible for establishing the Employer's business objectives, policies and
strategic  plans in  conjunction  with the  Board of  Directors  (the  "Board").
Executive  shall also be responsible  for providing  leadership and direction to
all departments or divisions, and shall be the primary contact between the Board
and the staff.  As Chief Executive  Officer,  Executive shall directly report to
the Board.  Executive shall also be nominated as a member of the Board,  subject
to election by shareholders.  Executive also agrees to serve, if elected,  as an
officer and director of any affiliate of the Employer.

2.   TERM AND DUTIES.

     (a) Three Year Contract;  Annual Renewal.  Executive's period of employment
with the Employer  ("Employment  Period")  shall begin on the Effective Date and
shall  renew on each  anniversary  date  thereafter,  until  the  date  that the
Employer gives Executive written notice of non-renewal  ("Non-Renewal  Notice").
The Employment Period shall end on the date that is thirty-six (36) months after

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the date of the Non-Renewal Notice, unless the parties agree that the Employment
Period shall end on an earlier date.  Notwithstanding the foregoing, all changes
to  the   Agreement   intended  to  comply  with  Code  Section  409A  shall  be
retroactively  effective  to  March  31,  2007;  and  provided  further  that no
retroactive change shall affect the compensation or benefits previously provided
to the Executive.

     (b) Annual Performance Evaluation. On either a fiscal year or calendar year
basis,  (consistently  applied from year to year), the Employer shall conduct an
annual evaluation of Executive's performance.  The annual performance evaluation
proceedings  shall be  included in the  minutes of the Board  meeting  that next
follows such annual performance review.

     (c)  Continued  Employment  Following  Termination  of  Employment  Period.
Nothing  in  this  Agreement   shall  mandate  or  prohibit  a  continuation  of
Executive's  employment  following the expiration of the Employment  Period upon
such terms and conditions as the Employer and Executive may mutually agree.

     (d) Duties;  Membership  on Other  Boards.  During the  Employment  Period,
except  for  periods of  absence  occasioned  by  illness,  reasonable  vacation
periods, and reasonable leaves of absence approved by the Board, 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 Employer; 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,  business
companies or business  organizations,  which, in the Board's judgment,  will not
present any conflict of interest  with the Employer,  or  materially  affect the
performance of Executive's duties pursuant to this Agreement it being understood
that  membership in and service on boards or  committees  of social,  religious,
charitable or similar  organizations does not require Board approval pursuant to
this Section 2(d).  For purposes of this Section 2(d),  Board  approval shall be
deemed to have been  granted as to  service  with any such  business  company or
organization that Executive was serving as of the date of this Agreement.

3.   COMPENSATION, BENEFITS AND REIMBURSEMENT.

     (a) Base Salary.  The  compensation  specified  under this Agreement  shall
constitute  the salary and benefits paid for the duties  described in Section 2.
The  Employer  shall pay  Executive  as  compensation  a salary of not less than
$252,703 per year ("Base Salary").  Such Base Salary shall be payable  biweekly,
or with such other  frequency  as officers and  employees  are  generally  paid.
During the period of this Agreement,  Executive's  Base Salary shall be reviewed
at least annually. Such review may be conducted by a Committee designated by the
Board,  and the Employer may increase,  but not decrease (except a decrease that
is generally  applicable  to all  employees)  Executive's  Base Salary (with any
increase in Base Salary to become "Base Salary" for purposes of this Agreement).

     (b)  Bonus  and  Incentive  Compensation.  Executive  will be  entitled  to
incentive  compensation  and bonuses as provided in any plan of the  Employer in
which Executive is eligible to participate.  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.

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     (c) Employee  Benefits.  The Employer 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 Employer 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,  except  as to any  changes  that  are  applicable  to all
participating  employees or as  reasonably  or  customarily  available.  Without
limiting the  generality  of the  foregoing  provisions  of this  Section  3(c),
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-and-accident  insurance  plans,  medical  coverage or any other  employee
benefit plan or arrangement  made available by the Employer in the future to its
senior  executives,  subject  to and  on a  basis  consistent  with  the  terms,
conditions and overall administration of such plans and arrangements.

     (d) Paid Time Off.  Executive  shall be entitled to paid vacation time each
year during the Employment  Period (measured on a fiscal or calendar year basis,
in  accordance  with the  Employer's  usual  practices),  as well as sick leave,
holidays and other paid absences in accordance with the Employer's  policies and
procedures  for senior  executives.  Any  unused  paid time off during an annual
period shall be treated in accordance with the Employer's  personnel policies as
in effect from time to time.

     (e) Expense  Reimbursements.  During the  Employment  Period,  the Employer
shall pay or reimburse  Executive  for the full cost of the use of an automobile
that is mutually  agreeable to the Employer and  Executive.  The Employer  shall
also pay or reimburse  Executive for all reasonable  travel,  entertainment  and
other reasonable  expenses incurred by Executive during the course of performing
his obligations under this Agreement,  including,  without limitation,  fees for
memberships  in such clubs and  organizations  as Executive  and the Board shall
mutually agree are necessary and  appropriate in connection with the performance
of his duties  under this  Agreement,  upon  presentation  to the Employer of an
itemized  account of such  expenses in such form as the Employer may  reasonably
require.  All  reimbursements  under this  Section 3(e) shall be paid as soon as
practicable by the Employer;  provided,  however,  that no payment shall be made
later  than  March 15 of the year  immediately  following  the year in which the
expense was incurred.

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;  provided,  however,  that benefits  shall be provided
either under  Section 4 or Section 5 (related to a Change in  Control),  but not
both,  such that to the extent the Executive has received  payments under one of
those  Sections,  the  Executive  shall  not  receive  payments  under the other
Section.  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  Employer  of  Executive's   full-time
employment  hereunder for any reason other than a Change in Control,  as defined
in Section 5 hereof, a Termination for Cause, as defined in Section 8 hereof, or

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a termination  upon Retirement as defined in Section 7 hereof,  or a termination
for Disability as set forth in Section 6 hereof; and

          (ii) Executive's  resignation  from the Employer's  employ upon any of
the following  (which shall be treated as  termination  of employment  for "Good
Reason"), unless consented to by Executive:

               (A) failure to appoint  Executive to the  Executive  Position set
forth in Section 1 above, or 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  position  and
responsibilities described in Section 1 above, to which Executive has not agreed
in writing (and any such material change shall be deemed a continuing  breach of
this Agreement);

               (B) a relocation of Executive's  principal place of employment to
a  location  that is more  than 50 miles  from the  location  of the  Employer's
principal executive offices as of the date of this Agreement;

               (C)  a  material  reduction  in  the  benefits  and  perquisites,
including  Base  Salary,  to  Executive  from  those  being  provided  as of the
Effective  Date (except for any reduction  that is part of a reduction in pay or
benefits that is generally applicable to officers or employees);

               (D) a liquidation or dissolution of the Company or the Bank other
than liquidations or dissolutions that are caused by reorganizations that do not
affect the status of the Executive; or

               (E) a material  breach of this  Agreement  by the  Company or the
Bank.

Upon the occurrence of any event described in clause (ii) above, Executive shall
have the right to elect to  terminate  his  employment  under this  Agreement by
resignation  within 90 days after the event  giving rise to said right to elect,
which  termination by Executive shall be an Event of  Termination.  The Employer
shall  have at least 30 days to remedy an event  set  forth in  clauses  (ii)(A)
through (E) above;  provided,  however,  that the Employer  shall be entitled to
waive such  period and make an  immediate  payment  hereunder.  If the  Employer
remedies the condition within such 30 day cure period, then no Good Reason shall
be deemed to exist with respect to such event.  If the Employer  does not remedy
the event  within  such 30 day cure  period,  then the  Executive  may deliver a
Notice of Termination,  as defined in Section 10(c), for Good Reason at any time
within 60 days following the expiration of such cure period.

     No payments or benefits shall be due to Executive under this Agreement upon
the termination of Executive's  employment  except as provided in Section 4 or 5
hereof.

     (b) Within 30 days following the occurrence of an Event of Termination, the
Employer 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 lump sum cash amount equal to three times
the sum of (i) the highest  annual rate of Base Salary paid to  Executive at any
time under the  Agreement,  plus (ii) the highest  bonus paid to Executive  with
respect to the three  completed  fiscal years prior to the Event of Termination.

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<PAGE>

Such  payments  shall  not be  reduced  in the  event  Executive  obtains  other
employment following termination of employment.

     (c) Within 30 days following the occurrence of an Event of Termination, the
Employer  shall pay  Executive,  or in the event of his  subsequent  death,  his
beneficiary  or  beneficiaries,  or his  estate,  as the case may be, a lump sum
equal to the excess,  if any, of the present value of the benefit that Executive
would have been entitled to under the Employer's defined benefit pension plan if
Executive  had  continued  working  for the  Employer  for 36  months  after the
effective  date of such  Event of  Termination,  over the  present  value of the
benefits to which  Executive was actually  entitled as of the effective  date of
such Event of Termination.

     (d) Upon the  occurrence  of an Event of  Termination,  the  Employer  will
provide at the Employer's  expense,  life insurance and non-taxable  medical and
dental  coverage   substantially   comparable,   as  reasonably  or  customarily
available, to the coverage maintained by the Employer for Executive prior to his
termination,  except  to  the  extent  such  coverage  may  be  changed  in  its
application  to all  Employer  employees.  Such  coverage  shall cease 36 months
following the Event of Termination.  In the alternative,  the Employer may elect
to pay to Executive a cash amount equal to  Executive's  cost of obtaining  such
benefits on his own,  adjusted for any federal or state  income taxes  Executive
has to pay on the cash amount  within 30 days  following  the  occurrence  of an
Event of Termination.

     (e)  Notwithstanding  the  foregoing,  in  the  event  the  Executive  is a
Specified Employee (as defined herein),  solely to the extent necessary to avoid
penalties under Code Section 409A,  payment of the Executive's  benefit pursuant
to Sections 4(b),  4(c) and 4(d), if applicable,  shall be made to the Executive
on the  first  day of the  seventh  month  following  the  Executive's  Event of
Termination.  "Specified  Employee"  shall be  interpreted  to comply  with Code
Section  409A and shall mean a key  employee  within the meaning of Code Section
416(i)  (without  regard to paragraph 5 thereof),  but an individual  shall be a
"Specified  Employee"  only if the  Company,  the Bank,  or any  affiliate  is a
publicly traded company.

     (f) For purposes of Section 4, Event of  Termination  shall be construed to
require a  "Separation  from  Service" as defined in Code  Section  409A and the
Treasury  Regulations  promulgated  thereunder,   such  that  the  Employer  and
Executive  reasonably  anticipate that the level of bona fide services Executive
would perform after termination  would  permanently  decrease to a level that is
less than 50% of the average level of bona fide services  performed  (whether as
an  employee  or an  independent  contractor)  over  the  immediately  preceding
36-month period.

5.   CHANGE IN CONTROL.

     (a) Any payment made under this  Section 5 is in lieu of any payments  that
may otherwise be owed to the Executive  under Section 4, such that the Executive
shall either receive  payments under Section 4 or under Section 5, but not under
both Sections.


     (b) Except for payments that are subject to Code Section 409A, for purposes
of this Agreement, the term "Change in Control" shall mean:

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          (i) a change in  control  of a nature  that  would be  required  to be
reported in response  to Item  5.01(a) 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 (the "Exchange Act"); or

          (ii) a change in control of the Bank or the Company within the meaning
of the Home Owners  Loan Act,  as amended  ("HOLA"),  and  applicable  rules and
regulations  promulgated  thereunder,  as in effect at the time of the Change in
Control; or

          (iii) any of the  following  events,  upon  which a Change in  Control
shall be deemed to have occurred:

               (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  securities of the
Company  representing  25% or more of the  combined  voting  power of  Company's
outstanding  securities  except  for  any  securities  purchased  by the  Bank's
employee stock ownership plan or trust; 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 Company's stockholders was approved by the same Nominating Committee serving
under an  Incumbent  Board,  shall be,  for  purposes  of this  subsection  (B),
considered as though he were a member of the Incumbent Board; or

               (C) a sale of all or substantially  all the assets of the Bank or
the Company,  or a plan of  reorganization,  merger,  consolidation,  or similar
transaction  occurs in which the  security  holders of the  Company  immediately
prior to the  consummation  of the  transaction do not own at least 50.1% of the
securities of the surviving  entity to be outstanding  upon  consummation of the
transaction; or

               (D)  a  proxy  statement  is  issued   soliciting   proxies  from
stockholders of the Company by someone other than the current  management of the
Company,  seeking  stockholder  approval of a plan of reorganization,  merger or
consolidation   of  the  Company  or  similar   transaction  with  one  or  more
corporations  as a result  of  which  the  outstanding  shares  of the  class of
securities  then subject to the plan are to be exchanged  for or converted  into
cash or property or securities not issued by the Company; or

               (E) a  tender  offer  is  made  for  25% or  more  of the  voting
securities of the Company and the shareholders  owning beneficially or of record
25% or more of the  outstanding  securities  of the  Company  have  tendered  or
offered to sell their  shares  pursuant to such tender  offer and such  tendered
shares have been accepted by the tender offeror.

     (c) With respect to any payments hereunder that are subject to Code Section
409A,  "Change in Control"  shall mean (i) a change in the ownership of the Bank
or the Company,  (ii) a change in the effective  control of the Bank or Company,
or (iii) a change in the ownership of a substantial portion of the assets of the
Bank or Company, as described below.

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          (i) A change in ownership  occurs on the date that any one person,  or
more than one person acting as a group (as defined in Final Treasury Regulations
section  1.409A-3(i)(5)(v)(B)),  acquires  ownership  of  stock  of the  Bank or
Company that, together with stock held by such person or group, constitutes more
than 50% of the total fair market  value or total  voting  power of the stock of
such corporation.

          (ii) A change in the effective  control of the Bank or Company  occurs
on the date that either (i) any one person,  or more than one person acting as a
group (as defined in Final Treasury  Regulations section  1.409A-3(i)(5)(vi)(D))
acquires (or has acquired  during the 12-month  period ending on the date of the
most recent  acquisition  by such person or persons)  ownership  of stock of the
Bank or Company possessing 30% or more of the total voting power of the stock of
the  Bank or  Company,  or (ii) a  majority  of the  members  of the  Bank's  or
Company's board of directors is replaced during any 12-month period by directors
whose  appointment  or election is not  endorsed by a majority of the members of
the Bank's or Company's  board of directors prior to the date of the appointment
or election,  provided that this  subsection  5(c)(ii) is  inapplicable  where a
majority shareholder of the Bank or Company is another corporation.

          (iii) A change in a  substantial  portion of the  Bank's or  Company's
assets  occurs on the date that any one person or more than one person acting as
a   group    (as    defined    in    Final    Treasury    Regulations    section
1.409A-3(i)(5)(vii)(C))  acquires  (or has acquired  during the 12-month  period
ending on the date of the most  recent  acquisition  by such  person or persons)
assets from the Bank or Company  that have a total gross fair market value equal
to or more  than 40% of the  total  gross  fair  market  value of (i) all of the
assets of the Bank or Company,  or (ii) the value of the assets  being  disposed
of, either of which is determined  without regard to any liabilities  associated
with such assets.  For all purposes of this  subsection  5(c), the definition of
Change in Control shall be construed to be consistent  with the  requirements of
Final Treasury  Regulations  section  1.409A-3(i)(5),  except to the extent that
such final regulations are superseded by subsequent guidance.


     (d) Within 30 days  following  the  effective  date of a Change in Control,
Executive,  or, in the event of his death  following  a Change in  Control,  his
beneficiary or  beneficiaries,  or his estate, as the case may be, shall receive
as severance  pay or  liquidated  damages,  or both, a lump sum payment equal to
three times the sum of (i)  Executive's  highest annual rate of Base Salary plus
(ii) the  highest  rate of bonus  awarded to  Executive  during the prior  three
years.

     (e) Within 30 days following the termination of the Executive's  employment
(other than for Cause)  following a Change in Control,  the  Employer  shall pay
Executive,  or in  the  event  of  his  subsequent  death,  his  beneficiary  or
beneficiaries,  or his  estate,  as the case  may be,  a lump  sum  equal to the
excess,  if any, of the present value of the benefit that  Executive  would have
been entitled to under the Employer's  defined benefit pension plan if Executive
had  continued  working for the  Employer for  thirty-six  (36) months after the
effective date of such termination of employment,  over the present value of the
benefits to which  Executive was actually  entitled as of the effective  date of
such termination of employment.

     (f) Upon the  termination  of the  Executive's  employment  (other than for
Cause)  following  a  Change  in  Control,  the  Employer  will  provide  at the
Employer's  expense,  life insurance and non-taxable medical and dental coverage
substantially  comparable,  as  reasonably  or  customarily  available,  to  the

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coverage  maintained  by the Employer for  Executive  prior to his  termination,
except to the extent  such  coverage  may be changed in its  application  to all
Employer  employees.  Such coverage shall cease thirty-six (36) months following
the Executive's termination of employment.

     (g) Notwithstanding the preceding  paragraphs of this Section, in the event
that the  aggregate  payments or benefits to be made or afforded to Executive in
the event of a Change in Control would be deemed to include an "excess parachute
payment"  under Section 280G of the Code or any successor  thereto,  then at the
election  of  Executive,  (i) such  payments  or  benefits  shall be  payable or
provided to Executive  over the minimum  period  necessary to reduce the present
value of such payments or benefits to an amount which is one dollar ($1.00) less
than three times  Executive's  "base  amount"  under Section 280G of the Code or
(ii) the  payments  or benefits  to be  provided  under this  Section 5 shall be
reduced  to the  extent  necessary  to avoid  treatment  as an excess  parachute
payment with the allocation of the reduction among such payments and benefits to
be determined by Executive. Notwithstanding the foregoing, in the event if it is
determined  that such  election by the  Executive  shall be in violation of Code
Section 409A, then the cash severance payable pursuant to Section 5 hereof shall
be  reduced  by the  minimum  amount  necessary  to result in no  portion of the
payments  and  benefits   payable  by  the  Employer   under   Section  5  being
non-deductible  pursuant to Code  Section 280G and subject to excise tax imposed
under Code Section 4999.

     (h)  Notwithstanding  the  foregoing,  in  the  event  the  Executive  is a
Specified Employee, solely to the extent necessary to avoid penalties under Code
Section 409A,  payment of the Executive's  benefit pursuant to Sections 5(e) and
5(f) if  applicable,  shall be made to the  Executive  on the  first  day of the
seventh month  following the Executive's  termination of employment  following a
Change in Control.

     (i) For  purposes of this Section 5,  termination  of  employment  shall be
construed to require a "Separation from Service" as defined in Code Section 409A
and the Treasury Regulations promulgated thereunder,  such that the Employer and
Executive  reasonably  anticipate that the level of bona fide services Executive
would perform after termination  would  permanently  decrease to a level that is
less than 50% of the average level of bona fide services  performed  (whether as
an  employee  or an  independent  contractor)  over  the  immediately  preceding
36-month period.


6.   TERMINATION FOR DISABILITY OR DEATH.

     (a) Termination of Executive's  employment  based on "Disability"  shall be
construed to comply with Code section 409A and shall be deemed to have  occurred
if (i) the Executive is unable to engage in any substantial  gainful activity by
reason of any medically  determinable physical or mental impairment which can be
expected to result in death, or last for a continuous period of not less than 12
months;  (ii)  by  reason  of any  medically  determinable  physical  or  mental
impairment  which can be expected to result in death,  or last for a  continuous
period of not less than 12 months, the Executive is receiving income replacement
benefits for a period of not less than three months under an accident and health
plan covering employees of the Employer; or (iii) the Executive is determined to
be totally  disabled by the Social  Security  Administration.  The provisions of

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paragraph  6(b) and (c) shall  apply  upon the  termination  of the  Executive's
employment for Disability.

     (b) The Executive shall be entitled to receive  benefits under any short or
long term  disability  plan  maintained  by the  Employer.  To the  extent  such
benefits  are less than the  Executive's  Base  Salary,  the  Employer  will pay
Executive  an  amount  equal to the  difference  between  such  disability  plan
benefits  and the amount of  Executive's  Base  Salary for the longer of (i) the
remaining  term of the Agreement or (ii) one year  following his  termination of
employment due to Disability.  Any payments required  hereunder shall be payable
in monthly  installments and shall commence within 30 days following the date on
which Executive is determined to be Disabled.

     (c) The Employer will cause to be continued life insurance and  non-taxable
medical  and  dental  coverage  substantially   comparable,   as  reasonable  or
customarily available,  to the coverage maintained by the Employer for Executive
prior to his termination for Disability,  except to the extent such coverage may
be changed in its  application to all Employer  employees or not available on an
individual basis to an employee  terminated for Disability.  This coverage shall
cease  upon the  earlier  of (i) the date  Executive  returns  to the  full-time
employment of the Employer;  (ii)  Executive's  full-time  employment by another
employer; (iii) Executive attaining the age of 65; or (iv) Executive's death.

     (d) In the event of Executive's death during the term of the Agreement, his
estate,  legal  representatives or named beneficiaries (as directed by executive
in writing) shall be paid  Executive's  Base Salary as defined in paragraph 3(a)
at the rate in effect at the time of  Executive's  death for a period of one (1)
year from the date of  Executive's  death,  and the  Employer  will  continue to
provide  non-taxable  medical,  dental  and other  insurance  benefits  normally
provided  for  Executive's  family  (in  accordance  with its  customary  co-pay
percentages)  for one (1) year after  Executive's  death.  Such  payments are in
addition to any other life insurance benefits that the Executive's beneficiaries
may be entitled to receive  under any employee  benefit plan  maintained  by the
Employer for the benefit of the  Executive,  including,  but not limited to, the
Employer's  tax-qualified retirement plans and the Executive Salary Continuation
Agreement (SERP).

7.   TERMINATION UPON RETIREMENT.

     Termination  of Executive's  employment  based on  "Retirement"  shall mean
termination  of  Executive's  employment  at age 65 or in  accordance  with  any
retirement policy established by the Board with Executive's consent with respect
to him.  Upon  termination  of  Executive  based on  Retirement,  no  amounts or
benefits shall be due Executive  under this  Agreement,  and Executive  shall be
entitled to all  benefits  under any  retirement  plan of the Employer and other
plans to which Executive is a party.

8.   TERMINATION FOR CAUSE.

     (a) The Employer may terminate the Executive's  employment at any time, but
any termination  other than Termination for Cause, as defined herein,  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

                                       9
<PAGE>

benefits for any period after Termination for Cause. Termination for Cause shall
include   termination   because   of  the   Executive's   personal   dishonesty,
incompetence,  willful  misconduct,  breach of fiduciary duty involving personal
profit,  material breach of the Employer's Code of Ethics, material violation of
the  Sarbanes-Oxley  requirements  for officers of public  companies that in the
reasonable opinion of the Board will likely cause substantial  financial harm or
substantial  injury to the  reputation  of the Employer,  willfully  engaging in
actions  that  in  the  reasonable  opinion  of  the  Board  will  likely  cause
substantial  financial harm or substantial injury to the business  reputation of
the Employer, intentional failure to perform stated duties, willful violation of
any law, rule or regulation  (other than routine  traffic  violations or similar
offenses) or final  cease-and-desist  order, or material breach of any provision
of the Agreement.

     (b) For  purposes of this  Section 8, no act or failure to act, on the part
of the Executive, shall be considered "willful" unless it is done, or omitted to
be done,  by the  Executive in bad faith or without  reasonable  belief that the
Executive's  action or omission was in the best  interests of the Employer.  Any
act, or failure to act,  based upon the direction of the Board or based upon the
advice of counsel for the Employer shall be conclusively presumed to be done, or
omitted to be done, by the Executive in good faith and in the best  interests of
the Employer.

9.   RESIGNATION FROM BOARDS OF DIRECTORS

     In the event of  Executive's  termination  of  employment  for any  reason,
Executive's  service as a director of the Bank,  the  Company and any  affiliate
shall  immediately  terminate.  This Section of the Agreement shall constitute a
resignation notice for such purposes.

10.  NOTICE.

     (a)  Any  purported   termination  by  the  Employer  for  Cause  shall  be
communicated by Notice of Termination to Executive. If, within 30 days after any
Notice of Termination for Cause is given, Executive notifies the Employer that a
dispute exists concerning the termination, the parties shall promptly proceed to
arbitration,  as provided in Section 20 below.  Notwithstanding  the pendency of
any such dispute, the Employer shall discontinue paying Executive's compensation
until the dispute is finally  resolved in accordance with this Agreement.  If it
is determined  that  Executive is entitled to  compensation  and benefits  under
Sections 4 or 5 of this Agreement, the payment of such compensation and benefits
by the Employer shall commence  immediately  following the date of resolution by
arbitration, with interest due Executive on the cash amount that would have been
paid  pending  arbitration  (at the prime rate as  published  in The Wall Street
Journal from time to time).

     (b) Any other  purported  termination by the Employer or by Executive shall
be  communicated  by a Notice of Termination  to the other party.  If, within 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 parties shall  promptly  proceed to arbitration as provided in
Section 20 below. Notwithstanding the pendency of any such dispute, the Employer
shall  continue to pay Executive  his Base Salary,  and other  compensation  and
benefits in effect when the notice  giving rise to the dispute was given (except
as to termination of Executive for Cause); provided, however, that such payments
and benefits shall not continue  beyond the date that is 36 months from the date

                                       10
<PAGE>

the Notice of  Termination is given.  In the event the voluntary  termination by
Executive of his employment is disputed by the Employer, and if it is determined
in arbitration that Executive is not entitled to termination  benefits  pursuant
to this  Agreement,  he shall  return  all  cash  payments  made to him  pending
resolution by arbitration,  with interest thereon at the prime rate as published
in The Wall Street  Journal from time to time if it is determined in arbitration
that Executive's voluntary termination of employment was not taken in good faith
and  not in the  reasonable  belief  that  grounds  existed  for  his  voluntary
termination.  If it is  determined  that the  Executive  is  entitled to receive
severance  benefits under this Agreement,  then any  continuation of Base Salary
and other  compensation and benefits made to the Executive under this Section 10
shall offset the amount of any severance  benefits that are due to the Executive
under this Agreement.

     (c) 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 and "Date of Termination" shall mean
the date of the Notice of Termination.

11.  POST-TERMINATION OBLIGATIONS.

     (a) The Executive  hereby  covenants  and agrees that,  for a period of one
year following his  termination of employment  with the Employer,  he shall not,
without the written consent of the Employer, either directly or indirectly:

          (i) solicit,  offer  employment to, or take any other action  intended
(or that a reasonable person acting in like circumstances  would expect) to have
the effect of causing any officer or employee of the Bank, the Company or any of
their  respective  subsidiaries or affiliates to terminate his or her employment
and  accept  employment  or become  affiliated  with,  or provide  services  for
compensation  in any  capacity  whatsoever  to,  any  business  whatsoever  that
competes  with the business of the Bank or the Company or any of their direct or
indirect  subsidiaries  or affiliates or has  headquarters  or offices within 50
miles of the locations in which the Bank or the Company has business  operations
or has filed an application for regulatory approval to establish an office;

          (ii) become an officer, employee,  consultant,  director,  independent
contractor, agent, sole proprietor, joint venturer, greater than 5% equity-owner
or  stockholder,  partner or  trustee  of any  savings  bank,  savings  and loan
association,  savings  and loan  holding  company,  credit  union,  bank or bank
holding company, insurance company or agency, any mortgage or loan broker or any
other  entity  competing  with  the  Employer  or its  affiliates  in  the  same
geographic  locations where the Employer or its affiliates has material business
interests;  provided,  however,  that  this  restriction  shall not apply if the
Executive's employment is terminated following a Change in Control; or

          (iii) solicit,  provide any information,  advice or  recommendation or
take any other  action  intended  (or that a  reasonable  person  acting in like
circumstances  would  expect) to have the effect of causing any  customer of the
Bank or the Company to terminate an existing business or commercial relationship
with the Bank or the Company.

                                       11
<PAGE>


     (b) Executive shall, upon reasonable  notice,  furnish such information and
assistance to the Bank and/or the Company,  as may reasonably be required by the
Bank and/or the Company, in connection with any litigation in which it or any of
its  subsidiaries or affiliates is, or may become, a party;  provided,  however,
that Executive  shall not be required to provide  information or assistance with
respect to any litigation between the Executive and the Bank, the Company or any
of its subsidiaries or affiliates.

     (c) All payments and benefits to the Executive  under this Agreement  shall
be subject to the Executive's  compliance with this Section. The parties hereto,
recognizing  that irreparable  injury will result to the Employer,  its business
and  property in the event of the  Executive's  breach of this Section 11, agree
that,  in the event of any such breach by the  Executive,  the Employer  will be
entitled,  in  addition  to any other  remedies  and  damages  available,  to an
injunction  to restrain the  violation  hereof by the  Executive and all persons
acting for or with the Executive.  The Executive  represents and admits that the
Executive's  experience and  capabilities are such that the Executive can obtain
employment  in a business  engaged in other lines  and/or of a different  nature
than the  Employer,  and that the  enforcement  of a remedy by way of injunction
will not prevent the Executive from earning a livelihood. Nothing herein will be
construed as  prohibiting  the Employer and the Company from  pursuing any other
remedies available to them for such breach or threatened  breach,  including the
recovery of damages from the Executive.

12.  SOURCE OF PAYMENTS.

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

13.  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  Employer or any
predecessor of the Employer 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 him without reference to this Agreement.

14.  NO ATTACHMENT; BINDING ON SUCCESSORS.

     (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 effect 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 Employer and their respective successors and assigns.

                                       12
<PAGE>

15.  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.

16.  REQUIRED PROVISIONS.

     (a) The Employer may terminate Executive's  employment at any time, but any
termination by the Employer's  Board other than Termination for Cause as defined
in Section 8 hereof shall not prejudice  Executive's  right to  compensation  or
other benefits under this  Agreement.  Executive  shall have no right to receive
compensation or other benefits for any period after Termination for Cause.

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

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

     (d) If the Employer is in default as defined in Section  3(x)(1) [12 U.S.C.
ss.1813(x)(1)]  of the Federal  Deposit  Insurance  Act, all  obligations of the
Employer under this  Agreement  shall  terminate as of the date of default,  but
this paragraph shall not affect any vested rights of the contracting parties.

     (e) All obligations under this Agreement shall be terminated, except to the
extent  determined  that  continuation  of the  Agreement is  necessary  for the
continued  operation of the  Employer,  (i) by the Director of the OTS or his or
her  designee,  at the  time  the  FDIC  enters  into an  agreement  to  provide
assistance  to or on behalf of the  Employer  under the  authority  contained in
Section 13(c) [12 U.S.C.  ss.1823(c)] of the Federal  Deposit  Insurance Act; or
(ii) by the  Director or his or her  designee at the time the Director or his or
her  designee  approves  a  supervisory  merger to resolve  problems  related to
operation of the Employer or when the Employer is  determined by the Director to

                                       13
<PAGE>

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) Notwithstanding anything herein contained to the contrary, any payments
to Executive by the Company,  whether  pursuant to this  Agreement or otherwise,
are subject to and conditioned  upon their  compliance with Section 18(k) of the
Federal Deposit  Insurance Act, 12 U.S.C.  Section 1828(k),  and the regulations
promulgated thereunder in 12 C.F.R. Part 359.

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.

     This  Agreement  shall  be  governed  by the  laws of the  Commonwealth  of
Pennsylvania 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 the  Executive  within
twenty-five  miles of Stroudsburg,  Pennsylvania 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.

21.  INDEMNIFICATION.

     (a) The  Executive  shall  be  provided  with  coverage  under  a  standard
directors' and officers'  liability  insurance policy,  and shall be indemnified
for the term of the  Agreement  and for a period of six years  thereafter to the
fullest  extent   permitted  under  applicable  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 Employer or any  affiliate  (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 (such settlements must be approved by the Board), provided, however,
the  Executive  shall not be  indemnified  or reimbursed  for legal  expenses or

                                       14
<PAGE>

liabilities  incurred in connection with an action,  suit or proceeding  arising
from  any  illegal  or  fraudulent   act   committed  by  Executive.   Any  such
indemnification  shall  be  made  consistent  with  Section  545.121  of the OTS
Regulations  and Section 18(k) of the Federal  Deposit  Insurance Act, 12 U.S.C.
ss.1828(k), and the regulations issued thereunder in 12 C.F.R. Part 359.

     (b) Any indemnification by the Employer shall be subject to compliance with
any applicable regulations of the OTS.

22.  NOTICE.

     For the purposes of this  Agreement,  notices and all other  communications
provided for in this  Agreement  shall be in writing and shall be deemed to have
been duly given when delivered or mailed by certified or registered mail, return
receipt requested,  postage prepaid,  addressed to the respective  addresses set
forth below:



                  To the Company:             ESSA Bancorp, Inc.
                                              200 Palmer Street
                                              Stroudsburg, PA 18360

                  To the Bank:                ESSA Bank & Trust
                                              200 Palmer Street
                                              Stroudsburg, PA 18360

                  To Executive:               Gary S. Olson
                                              7015 Bangor Mountain Road
                                              Stroudsburg PA 18360

                                       15
<PAGE>


<PAGE>





                                   SIGNATURES


     IN WITNESS  WHEREOF,  the Employer has caused this Agreement to be executed
by  their  duly  authorized  representatives,  and  Executive  has  signed  this
Agreement, on the date first above written.

                                                       ESSA BANCORP, INC.




9/30/2008                                         /s/ John E. Burrus
-------------------------------               By: -----------------------------
Date                                              John E. Burrus,
                                                    Chairman of the Board


                                                       ESSA BANK & TRUST


9/30/2008                                         /s/ John E. Burrus
-------------------------------               By:------------------------------
Date                                             John E. Burrus,
                                                    Chairman of the Board


                                              EXECUTIVE:



9/30/2008                                     /s/ Gary S. Olson
------------------------------                ---------------------------------
Date                                          Gary S. Olson