<PAGE>
            HARBOR FEDERAL BANCORP, INC.
      SEVERANCE AGREEMENT WITH NORBERT J. LUKEN

                 ____________________

                    1998 AMENDMENT
                 ____________________


     WHEREAS, Harbor Federal Bancorp, Inc. (the "Company")
entered into a severance agreement (the "Agreement") with
Norbert J. Luken (the "Employee") on August 11, 1994; and

     WHEREAS, the Company's Board of Directors and the Employee
have determined that it is in their respective best interests to
amend the Agreement to update its change-in-control provisions.

     NOW, THEREFORE, effective March 30, 1998, the Agreement
shall be amended as follows, pursuant to Section 7 thereof:

     1.   The first paragraph of Section 1(a) of the Agreement
shall be amended in its entirety to provide as follows with
italics herein highlighting new text:

          (a)  Notwithstanding any provision herein to the
     contrary, the Employee shall be entitled to collect the
     severance benefits set forth in this Section in the event
     that (1) the Employee's employment under this Agreement is
     terminated by the Company, without the Employee's prior
     written consent and for a reason other than Just Cause, in
     connection with or within twenty-four (24) months after any
     change in control of Harbor Federal Savings Bank (the
     "Bank") or the Company, or (2) the Employee voluntarily
     terminates employment for any reason within the 30-day
     period beginning on the date of a change in control.  The
     Employee shall be paid an amount equal to the difference 
     between (i) the product of 2.99 times his "base amount" as
     defined in Section 280G(b)(3) of the Internal Revenue Code
     of 1986, as amended (the "Code") and regulations
     promulgated thereunder, and (ii) the sum of any other
     parachute payments (as defined under Section 280G(b)(2) of
     the Code) that the Employee receives on account of the
     change in control. 

          Any severance benefits that are payable under this
     Agreement after the closing date of a change in control of
     the Bank or the Company shall be paid in the manner
     selected by the Employee in a duly executed irrevocable
     written election (the "Election Form"), attached hereto as
     Exhibit "A"; provided that such an election will be honored
     and given effect only if it is properly made and delivered
     to the Company more than 90 days before said closing date. 
     Present value determinations and interest accruals on
     present value sums that are paid in installments over a
     fixed period of years shall be calculated at a rate equal
     to 120% of the applicable federal rate, compounded
     semiannually, as determined under Section 1274(d) of the
     Internal Revenue Code of 1986, as amended, and the
     regulations thereunder.  
<PAGE>
<PAGE>
1998 Amendment to
Severance Agreement
Page 2

          The Employee may specify on the Election Form the
     manner of payment to his beneficiary, and may at any time
     or from time to time change the identity or manner of
     payment to his beneficiary.

     2.   Section 1 of the Agreement shall be further amended by
adding subsection (d) immediately at the end thereof to provide
as follows:

          (d)  If the Employee's employment with the Company
     terminates for any reason (other than Just Cause) on or
     after a change in control, the Employee shall be entitled
     to purchase from Company or its successor, at the
     Employee's own expense which shall not exceed applicable
     COBRA rates, family medical insurance under any group
     health plan that the acquiring company maintains for its
     employees.  This right shall be (i) in addition to, and not
     in lieu of, any other rights that the Employee has under
     this Agreement and (ii) shall continue for five years after
     the change in control.

     3.   Nothing contained herein shall be held to alter, vary
or affect any of the terms, provisions, or conditions of the
Agreement, other than as stated above.

     WHEREFORE, on this 30th day of March, 1998, the Company
hereby executes this 1998 Amendment to the Agreement.

                               HARBOR FEDERAL BANCORP, INC.
Witnessed by:

/s/ Calvin W. Anthony             By /s/ Robert A. Williams
---------------------             -------------------------
                                  Its Chairman of the Board      
        

                              
                               EMPLOYEE
Witnessed by:

/s/ Calvin W. Anthony          By /s/ Norbert J. Luken
---------------------             -------------------------
                                   

<PAGE>
<PAGE>
              HARBOR FEDERAL SAVINGS BANK
       SEVERANCE AGREEMENT WITH NORBERT J. LUKEN

                 ____________________

                    1998 AMENDMENT
                 ____________________


     WHEREAS, Harbor Federal Savings Bank (the "Bank") entered
into a severance agreement (the "Agreement") with Norbert J.
Luken (the "Employee") on August 11, 1994; and

     WHEREAS, the Bank and the Employee have determined that it
is in their respective best interests to amend the Agreement to
update its change-in-control provisions.

     NOW, THEREFORE, the Agreement shall be amended as follows,
pursuant to Section 7 thereof:

     1.   The first paragraph of Section 1(a) of the Agreement
shall be amended in its entirety to provide as follows with
italics herein highlighting new text:

          (a)  Notwithstanding any provision herein to the
     contrary, the Employee shall be entitled to collect the
     severance benefits set forth in this Section in the event
     that (1) the Employee's employment under this Agreement is
     terminated by the Bank, without the Employee's prior
     written consent and for a reason other than Just Cause, in
     connection with or within twenty-four (24) months after any
     change in control of the Bank or Harbor Federal Bancorp,
     Inc. (the "Company"), or (2) the Employee voluntarily
     terminates employment for any reason within the 30-day
     period beginning on the date of a change in control.  The
     Employee shall be paid an amount equal to the difference
     between (i) the product of 2.99 times his "base amount" as
     defined in Section 280G(b)(3) of the Internal Revenue Code
     of 1986, as amended (the "Code") and regulations
     promulgated thereunder, and (ii) the sum of any other
     parachute payments (as defined under Section 280G(b)(2) of
     the Code) that the Employee receives on account of the
     change in control. 

          Any severance benefits that are payable under this
     Agreement after the closing date of a change in control of
     the Bank or the Company shall be paid in the manner
     selected by the Employee in a duly executed irrevocable
     written election (the "Election Form"), attached hereto as
     Exhibit "A"; provided that such an election will be honored
     and given effect only if it is properly made and delivered
     to the Bank more than 90 days before said closing date. 
     Present value determinations and interest accruals on
     present value sums that are paid in installments over a
     fixed period of years shall be calculated at a rate equal
     to 120% of the applicable federal rate, compounded
     semiannually, as determined under Section 1274(d) of the
     Internal Revenue Code of 1986, as amended, and the
     regulations thereunder.  
<PAGE>
<PAGE>
1998 Amendment to Severance Agreement
Page 2

          The Employee may specify on the Election Form the
     manner of payment to his beneficiary, and may at any time
     or from time to time change the identity or manner of
     payment to his beneficiary.

     2.   Section 1(d) of the Agreement shall be amended in its
entirety to provide as follows, with italics herein highlighting
new text:

          (d)  Funding of Grantor Trust.  Not later than three
     business days after a change in control, the Bank shall (a)
     deposit, in the Harbor Federal Savings Bank Grantor Trust
     (the "Trust"), an amount that the Bank reasonably projects
     to be sufficient to fund the payment of all severance
     benefits that are or may become payable, pursuant to this
     Section, after the closing date of the change in control of
     the Bank or the Company, and (b) provide the trustee of the
     Trust with a written direction both to hold said amount and
     any investment return thereon in a segregated account for
     the benefit of the Employee, and to follow the procedures
     set forth in the next paragraph as to the payment of such
     amounts from the Trust.  The provisions of this Section
     shall be null and void only if the Executive provides a
     written release of all claims under this Agreement.

          During the 24-consecutive month period after a change
     in control of the Bank or the Company, the Employee may
     provide the trustee of the Trust with a written notice
     directing the trustee to pay to Employee an amount
     designated in the notice as being payable pursuant to this
     Agreement.  Within three business days after receiving said
     notice, the trustee of the Trust shall pay such amount to
     the Employee,and coincidentally shall provide the Bank or
     its successor with notice of such payment.  Upon the
     earlier of the Trust's final payment of all amounts due
     under the preceding paragraph or the date 24 months after
     the change in control of the Bank or the Company, the
     trustee of the Trust shall pay to the Bank the entire
     balance remaining in the segregated account maintained for
     the benefit of the Employee.  The Employee shall thereafter
     have no further interest in the Trust.

     3.   Section 1 of the Agreement shall be further amended by
adding subsection (e) immediately at the end thereof to provide
as follows:

          (e)  If the Employee's employment terminates with the
     Bank for any reason other than Just Cause, the Employee
     shall be entitled to purchase from the acquiring company,
     at the Employee's own expense which shall not exceed
     applicable COBRA rates, family medical insurance under any
     group health plan that the acquiring company maintains for
     its employees.   This right shall be (i) in addition to,
     and not in lieu of, any other rights that the Employee has
     under this Agreement and (ii) shall continue for five years
     after the change in control.

     4.   Nothing contained herein shall be held to alter, vary
or affect any of the terms, provisions, or conditions of the
Agreement, other than as stated above.
<PAGE>
<PAGE>
1998 Amendment to Severance Agreement
Page 3

     WHEREFORE, on this 30th day of March, 1998, the Bank hereby
executes this 1998 Amendment to the Agreement.


                               HARBOR FEDERAL SAVINGS BANK
Witnessed by:


/s/ Kelly Hoyle                By /s/ Robert A. Williams
---------------------             -------------------------
                                  Its Chairman of the Board      
        

                              
                               EMPLOYEE
Witnessed by:

/s/ Kelly Hoyle                By /s/ Norbert J. Luken
---------------------             -------------------------