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"), and Robert S. Howes
("Executive").  Any reference to the "Company" shall mean ESSA Bancorp,  Inc., a
stock holding company which owns 100% of the common stock of the Bank.

     WHEREAS, Executive is currently employed as Senior Vice President,  Lending
Services  Division of the Bank  pursuant  to an  employment  agreement  that was
effective March 31, 2007 (the "Original Agreement"); and

     WHEREAS,  the Bank 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 Bank on the terms and conditions
hereinafter set forth and has agreed to such changes; and

     WHEREAS, the Board of Directors of the Bank and the Executive believe it is
in the  best  interests  of the Bank to enter  into  the  Agreement  in order to
reinforce  and  reward the  Executive  for his  service  and  dedication  to the
continued  success of the Bank and incorporate the changes required by the final
regulations issued 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
Senior Vice  President,  Lending  Services  Division of the Bank (the "Executive
Position").  Executive  shall be responsible  for the overall  management of the
Bank's lending services functions, and shall be responsible for establishing the
business objectives,  policies and strategic plans in conjunction with the Chief
Executive Officer (the "CEO").

2.  TERM AND DUTIES.

     (a) Two Year Contract;  Annual  Renewal.  Executive's  period of employment
with the Bank ("Employment  Period") shall begin on the Effective Date and shall
renew on each anniversary  date  thereafter,  until the date that the Bank gives
Executive written notice of non-renewal  ("Non-Renewal  Notice"). The Employment
Period shall end on the date that is  twenty-four  (24) months after 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.

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     (b) Annual Performance Evaluation. On either a fiscal year or calendar year
basis,  (consistently  applied  from year to year),  the Bank  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 Bank 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 CEO,  Executive shall
devote substantially all his business time, attention, skill, and efforts to the
faithful  performance of his duties hereunder including  activities and services
related to the  organization,  operation and  management of the Bank;  provided,
however, that, with the approval of the CEO, 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 CEO'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  it being
understood  that  membership  in and service on boards or  committees of social,
religious,  charitable  or similar  organizations  does not require CEO approval
pursuant to this Section 2(d).  For purposes of this Section 2(d),  CEO 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 Bank shall pay Executive as  compensation a salary of not less than $130,378
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 the CEO, and the Bank 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 Bank 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.

     (c)  Employee  Benefits.  The Bank will  provide  Executive  with  employee
benefit plans, arrangements and perquisites substantially equivalent to those in
which Executive was participating or otherwise deriving benefit from immediately
prior to the  beginning  of the term of this  Agreement,  and the Bank will not,
without  Executive's  prior  written  consent,  make any  changes in such plans,

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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 Bank 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 Bank's usual practices),  as well as sick leave, holidays
and other paid absences in accordance  with the Bank's  policies and  procedures
for senior executives. Any unused paid time off during an annual period shall be
treated in accordance with the Bank's personnel  policies as in effect from time
to time.

     (e) Expense  Reimbursements.  During the Employment  Period, the Bank shall
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,  upon presentation to the Bank of an itemized
account of such expenses in such form as the Bank may  reasonably  require.  All
reimbursements  under this Section 3(e) shall be paid as soon as  practicable by
the Bank, 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. 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  for Cause,  as defined in
Section 8 hereof,  or 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 Bank'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);

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<PAGE>

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

               (C)  a  material  reduction  in  the  benefits  and  perquisites,
including  Base  Salary,  to the  Executive  from those  being  provided  in the
Agreement 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  Bank  other  than
liquidations  or  dissolutions  that are caused by  reorganizations  that do not
affect the status of the Executive;

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

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 Bank shall
have at least 30 days to remedy any event set forth in clauses  (ii)(A)  through
(E) above,  provided,  however,  that the Bank shall be  entitled  to waive such
period and make an immediate payment  hereunder.  If the Bank remedies the event
within such 30 day cure  period,  then no Good  Reason  shall be deemed to exist
with respect to such event. If the Bank does not remedy the event within such 30
day cure period,  then the  Executive  may deliver a Notice of  Termination,  as
defined in  Section  9(c)  hereof,  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.

     (iii) Executive's  resignation from the Bank's employ following a Change in
Control (as defined in Section 5 below).

     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
Bank  shall  pay  Executive,  or,  in the  event of his  subsequent  death,  his
beneficiary or  beneficiaries,  or his estate,  as the case may be, as severance
pay or  liquidated  damages,  or both, a lump sum cash amount equal to two 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 two  completed  fiscal  years prior to the Event of  Termination.
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
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 lump sum
equal to the excess,  if any, of the present value of the benefit that Executive
would have been  entitled to under the Bank's  defined  benefit  pension plan if
Executive had  continued  working for the Bank for 24 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.

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     (d) Upon the occurrence of an Event of  Termination,  the Bank will provide
at the Bank's expense, life insurance and non-taxable medical, dental and vision
coverage substantially  comparable,  as reasonably or customarily available,  to
the coverage  maintained  by the Bank for  Executive  prior to his  termination,
except to the extent such coverage may be changed in its application to all Bank
employees.   Such  coverage  shall  cease  24  months  following  the  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 Bank or any  affiliate  is a publicly  traded
company.

     (f) For purposes of this Agreement, 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 Bank 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) For  purposes of this  Agreement,  the term  "Change in Control"  shall
mean:

          (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

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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.

     (b) 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 the cash
severance  payable  under  Section  4 shall be  reduced  by the  minimum  amount
necessary to result in no portion of the  payments  and benefits  payable by the
Bank under  Section 4 being  non-deductible  pursuant to Code  Section  280G and
subject to an excise tax imposed under Code Section 4999.

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 Bank; or (iii) the Executive is determined to be
totally  disabled  by the Social  Security  Administration.  The  provisions  of
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 Bank. To the extent such benefits
are less than the Executive's Base Salary, the Bank will pay Executive an amount
equal to the difference  between such disability plan benefits and the amount of

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<PAGE>

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 Bank will cause to be  continued  life  insurance  and  non-taxable
medical, dental and vision coverage substantially  comparable,  as reasonable or
customarily  available,  to the coverage  maintained  by the Bank for  Executive
prior to his termination for Disability,  except to the extent such coverage may
be changed in its  application  to all Bank  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  Bank;  (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 Bank will continue to provide
non-taxable  medical,  dental,  vision  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
Bank for the benefit of the Executive, including, but not limited to, the Bank'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 Bank and other plans
to which Executive is a party.

8.   TERMINATION FOR CAUSE.

     (a) The Bank 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
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 Bank's Code of Ethics, material violation of the
Sarbanes-Oxley  requirements  for  officers  of  public  companies  that  in the
reasonable  opinion  of the  CEO or the  Board  will  likely  cause  substantial

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<PAGE>

financial  harm  or  substantial  injury  to the  reputation  of the  the  Bank,
willfully  engaging in actions that in the reasonable  opinion of the CEO or the
Board will likely cause substantial  financial harm or substantial injury to the
business  reputation of the Bank,  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 Bank. Any act,
or failure to act,  based upon the direction of the CEO or based upon the advice
of counsel for the Bank 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 Bank.

9.    NOTICE.

     (a) Any purported  termination by the Bank 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 Bank that a dispute
exists  concerning  the  termination,  the  parties  shall  promptly  proceed to
arbitration.  Notwithstanding  the pendency of any such dispute,  the Bank 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 Section 4of this Agreement,  the
payment of such compensation and benefits by the Bank 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 Bank 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 19 of this Agreement.  Notwithstanding the pendency of any such dispute,
the Bank 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 24 months from
the date the  Notice  of  Termination  is  given.  In the  event  the  voluntary
termination by Executive of his employment is disputed by the Bank, 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 9 shall offset the amount of any severance  benefits that are due to the
Executive under this Agreement.

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     (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.

10.  POST-TERMINATION OBLIGATIONS.

     (a) The Executive  hereby  covenants  and agrees that,  for a period of one
year  following  his  termination  of  employment  with the Bank,  he shall not,
without the written consent of the Bank, 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 or any of its
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 any
of its  affiliates  or has  headquarters  or  offices  within  50  miles  of the
locations in which the Bank or its  affiliates  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 Bank or its  affiliates in the same  geographic
locations  where the Bank 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  its  affiliates  to  terminate  an  existing  business  or  commercial
relationship with the Bank or its affiliates.

     (b) Executive shall, upon reasonable  notice,  furnish such information and
assistance to the Bank and/or its  affiliates,  as may reasonably be required by
the Bank and/or its affiliates, 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, or
any of its 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 Bank, its business and
property in the event of the Executive's breach of this Section,  agree that, in
the event of any such breach by the  Executive,  the Bank will be  entitled,  in

                                       9
<PAGE>

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 Bank,
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 Bank  from  pursuing  any  other  remedies  for such  breach or
threatened breach, including the recovery of damages from the Executive.

11.  SOURCE OF PAYMENTS.

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

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 him without reference to this Agreement.

13.  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 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.

                                       10
<PAGE>


15.  REQUIRED PROVISIONS.

     (a) The Bank may  terminate  Executive's  employment  at any time,  but any
termination by the Bank'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 Bank'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  Bank'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 Bank
may in its discretion (i) pay Executive all or part of the compensation withheld
while its contract 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 Bank'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 Bank 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 Bank 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 Bank
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 Bank,  (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 Bank 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 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) Notwithstanding anything herein contained to the contrary, any payments
to Executive,  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.

16.  SEVERABILITY.

     If, for any reason,  any  provision of this  Agreement,  or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this  Agreement or any part of such  provision not held so invalid,  and each

                                       11
<PAGE>

such other  provision and part thereof shall to the full extent  consistent with
law continue in full force and effect.

17.  HEADINGS FOR REFERENCE ONLY.

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

18.  GOVERNING LAW.

     This  Agreement  shall  be  governed  by the  laws of the  Commonwealth  of
Pennsylvania but only to the extent not superseded by federal law.

19.  ARBITRATION.

     Any  dispute  or  controversy  arising  under or in  connection  with  this
Agreement shall be settled exclusively by arbitration, conducted before a single
arbitrator  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.

20.  INDEMNIFICATION.

     (a) The  Executive  shall  be  provided  with  coverage  under  a  standard
directors' and officers'  liability  insurance policy.  The Bank shall indemnify
Executive to the fullest extent  permitted  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 an
officer of the Bank (whether or not he continues to be an officer at the time of
the 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  that the Bank shall not be required to indemnify or reimburse
Executive  for legal  expenses or  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.

21.  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:

                                       12
<PAGE>

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

                  To Executive:             Robert S. Howes
                                            452 Creekwood Drive
                                            Stroudsburg, PA 18360




                                   SIGNATURES


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

                                              ESSA BANK & TRUST


9/30/2008                                         /s/ Gary S. Olson
------------------------------                By: -----------------------------
Date                                               Gary S. Olson, President and
                                                   Chief Executive Officer


                                              EXECUTIVE:

9/30/2008                                     /s/ Robert S. Howes
------------------------------                ---------------------------------
Date                                          Robert S. Howes