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                              EMPLOYMENT AGREEMENT


         THIS EMPLOYMENT AGREEMENT is effective as of October 1, 1998
between St. Francis Capital Corporation (the "Company"), a
Wisconsin-chartered corporation, St. Francis Bank, F.S.B. (the
"Bank"), a federally-chartered savings and loan and wholly-owned
subsidiary of the Company, their respective successors and assigns,
and Jon D. Sorenson (the "Executive").


                                    RECITALS

         WHEREAS, Executive is a key employee, whose extensive background,
knowledge and experience in the savings and loan industry has substantially
benefitted the Bank and Company and whose continued employment as an executive
member of their respective management teams in the positions of Senior Vice
President, Finance, for the Bank and Chief Financial Officer for the Company,
("Corporate Position") will continue to benefit the Bank and Company in the
future; and

         WHEREAS, the parties are mutually desirous of entering into this
Agreement setting forth the terms and conditions for the employment relationship
between the Bank, Company (sometimes collectively referred to herein as the
"Employers"), and Executive; and

         WHEREAS, the respective Boards of Directors of the Employers have
approved and authorized their entry into this Agreement with Executive.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth below:

         1. Employment. The Bank and Company shall continue to employ Executive,
and Executive shall continue to serve the Bank and Company, on the terms,
conditions and for the period set forth in Section 2 of this Agreement.

         2. Term of Employment. The period of Executive's employment under this
Agreement shall begin as of October 1, 1998 (the Commencement Date) and expire
on the third anniversary of the date immediately preceding the Commencement
Date, unless sooner terminated as provided herein; provided that, on each date
immediately preceding the anniversary of the Commencement Date, the term of
employment may be extended by action of the Bank's and Company's Boards of
Directors, following an explicit review by said Boards of the Executive's
performance under this Agreement (with appropriate documentation thereof and
after taking into account all relevant factors including Executive's performance
hereunder), to add one additional year to the remaining term of employment


<PAGE>   2



annually restoring such term to a full three-years. The Board of Directors or
Executive shall each provide the other with at least ninety (90) days' advance
written notice of any decision on their respective parts not to extend the
Agreement on any date immediately preceding an anniversary of the Commencement
Date. The term of employment as in effect from time to time hereunder shall be
referred to as the "Employment Term".

         3.       Positions and Duties. Executive shall serve the Bank and
Company, respectively, in his Corporate Position, reporting directly to their
Chief Executive Officers and serving as a member of the Bank's and Company's
Management Committees and being generally responsible to assist in the
formulation of their business and personnel policies, rendering executive,
policy-making and other management services of the type customarily performed by
persons serving in similar capacities at other institutions, together with such
other duties and responsibilities as may be appropriate to Executive's position
and as may be from time to time determined by the Bank's and Company's Boards of
Directors to be necessary to their operations and in accordance with their
bylaws.

         4.       Compensation. As compensation for services provided pursuant
to this Agreement, Executive shall receive from the Bank the compensation and
benefits set forth below:

                  (i) Base Salary. During the Employment Term, Executive shall
         receive from Employers a base salary ("Base Salary") in such amount as
         may from time to time be approved by their Boards of Directors. The
         Base Salary shall at no time be less than $115,500 per annum, payable
         by the Bank and Company in such proportion as shall be determined by
         their Boards of Directors. The Base Salary may be increased from time
         to time as determined by the Employers' Boards of Directors, provided
         that no such increase in Base Salary or other compensation shall in any
         way limit or reduce any other obligation of the Employers under this
         Agreement. Once established at a specified annual rate, Executive's
         Base Salary shall not thereafter be reduced except as part of a general
         pro-rata reduction in compensation applicable to all Executive
         Officers; provided, however, that no such reduction shall be permitted
         following a "change in control" as defined herein. Executive's Base
         Salary and other compensation shall be paid in accordance with the
         Employers' regular payroll practices as from time to time in effect.
         For purposes of this Agreement, the term "Executive Officers" shall
         mean all officers of the Bank and/or Company having a written
         Employment Agreement.

                  (ii) Bonus and Incentive Plans. Executive shall be entitled,
         during the Employment Term, to participate in and receive payments from
         all bonus and other incentive compensation plans (as currently in
         effect, as modified from



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         time to time, or as subsequently adopted); provided, however, that
         nothing contained herein shall grant Executive the right to continue in
         any bonus or other incentive compensation plan following its
         discontinuance by the Board or Boards (except to the extent Executive
         had earned or otherwise accumulated vested rights therein prior to such
         discontinuance). In addition, Executive shall participate in all stock
         purchase, stock option, stock appreciation right, stock grant, or other
         stock based incentive programs of any type made available by Employers
         to their Executive Officers. The Employers shall not make any changes
         in such plans, benefits or privileges which would adversely affect
         Executive's rights or benefits thereunder, unless such change occurs
         pursuant to a program applicable to all Executive Officers of the
         Employers and does not result in a proportionately greater adverse
         change in the rights and benefits of Executive as compared with other
         Executive Officers.

                  (iii) Other Benefits. During the Employment Term, Employers
         shall provide to Executive all other benefits of employment (or, with
         Executive's consent, equivalent benefits) generally made available to
         other Executive Officers. Such benefits shall include participation by
         Executive in any group health, life, disability, or similar insurance
         program and in any pension, profit-sharing, Employee Stock Ownership
         Plan ("ESOP"), 401(k) or other or similar retirement program. Employers
         shall continue in effect any individual insurance plans or deferred
         compensation agreements in effect as of the Commencement Date and
         Executive shall be entitled to use of an automobile provided by
         Employers under the terms of such corporate automobile policy as they
         shall maintain in effect and as it may be amended from time to time.

         Executive shall receive vacation, sick time, personal days and other
         perquisites in the same manner and to the same extent as provided under
         the Employers' policies as in effect from time to time for other
         Executive Officers. Employers shall also reimburse Executive or
         otherwise provide for or pay all reasonable expenses incurred by
         Executive in furtherance of or in connection with the business of
         Employers, including but not by way of limitation, travel expenses and
         all reasonable entertainment expenses (whether incurred at Executive's
         residence, while traveling or otherwise) subject to such reasonable
         documentation and other limitations as may be imposed by the Boards of
         Directors of the Employers.

                  Nothing contained herein shall be construed as granting
         Executive the right to continue in any benefit plan or program, or to
         receive any other perquisite of employment provided under this
         subsection 4(iii) following termination or discontinuance of such plan,
         program or perquisite by the Board (except to the extent Executive had
         previously earned or



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         accumulated vested rights therein).

         5.       Termination Other Than Following a Change-In-Control. This
Agreement may be terminated, subject to payment of the compensation and other
benefits described below, upon occurrence of any of the events described herein.
In case of such termination, the date on which Executive ceases to be employed
under this Agreement, after giving effect to any prior notice requirement, is
referred to as the "Termination Date".

                  (i) Death, Retirement. This Agreement shall terminate at the
         death or retirement of Executive. As used herein, the term "retirement"
         shall mean Executive's retirement in accordance with and pursuant to
         any retirement plan of the Employers generally applicable to Executive
         Officers or in accordance with any retirement arrangement established
         for Executive with his consent.

                  If termination occurs for such reason, no additional
         compensation shall be payable to Executive under this Agreement except
         as specifically provided herein. Notwithstanding anything to the
         contrary contained herein, Executive shall receive all compensation and
         other benefits to which he was entitled under Section 4 through the
         Termination Date and, in addition, shall receive all other benefits
         available to him under the Bank's benefit plans and programs to which
         he was entitled by reason of employment through the Termination Date.

                  (ii) Disability. This Agreement shall terminate upon the
         disability of Executive. As used in this Agreement, "disability" shall
         mean Executive's inability, as the result of physical or mental
         incapacity, to substantially perform his employment duties for a period
         of 90 consecutive days. Any question as to the existence of Executive's
         disability upon which Executive and Employers cannot agree shall be
         determined by a qualified independent physician mutually agreeable to
         Executive and Employers or, if the parties are unable to agree upon a
         physician within ten (10) days after notice from either to the other
         suggesting a physician, by a physician designated by the then president
         of the medical society for the county in which Executive maintains his
         principal residence. The costs of any such medical examination shall be
         borne by the Employers. If Executive is terminated due to disability,
         he shall be paid 100% of his Base Salary at the rate in effect at the
         time notice of termination is given for one year and thereafter an
         annual amount equal to 75% of such Base Salary for any remaining
         portion of the Employment Term, such amounts to be paid in
         substantially equal monthly installments and offset by any monthly
         payments actually received by Executive during the payment period from
         (i) any disability plans provided by the Employers, and/or (ii) any
         governmental social




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         security or workers compensation program.

                  If termination occurs for such reason, no additional
         compensation shall be payable to Executive except as specifically
         provided herein. Notwithstanding anything to the contrary contained
         herein, Executive shall receive all compensation and other benefits to
         which he was entitled under Section 4 through the Termination Date and,
         in addition, shall receive all other benefits under the Employers'
         benefit plans and programs to which he was entitled by reason of
         employment through the Termination Date.

                  (iii) Cause. Employers may terminate Executive's employment
         under this Agreement for cause at any time, and thereafter their
         obligations under this Agreement shall cease and terminate.
         Notwithstanding anything to the contrary contained herein, Executive
         shall receive all compensation and other benefits in which he was
         vested or to which he was otherwise entitled under Section 4, and the
         plans and programs provided therein, by reason of employment through
         the Termination Date.

                  For purposes of this Agreement, "Cause" shall mean:

                  (A)      The intentional failure by Executive to
                           substantially perform assigned duties (appropriate
                           to his position and level of compensation) with the
                           Bank (other than any such failure resulting from
                           the Executive's  incapacity due to physical or
                           mental illness) after a written demand for
                           substantial performance is delivered to Executive
                           by the Board, which demand specifically identifies
                           the manner in which the Board believes Executive
                           has not substantially performed his duties, advises
                           Executive of what steps must be taken to achieve
                           substantial performance, and allows Executive Sixty
                           (60) days in which to demonstrate such performance;

                  (B)      Any willful act of misconduct by Executive;

                  (C)      A criminal conviction of Executive for any act
                           involving dishonesty, breach of trust or a violation
                           of the banking or savings and loan laws of the United
                           States;

                  (D)      A criminal conviction of Executive for the commission
                           of any felony;

                  (E)      A breach of fiduciary duty involving personal profit;

                  (F)      A willful violation of any law, rule or regulation





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                           (other than a traffic violation or similar
                           offenses) or final cease and desist order;  or

                  (G)      Personal dishonesty or material breach of any
                           provision of this Agreement.

         For purposes of this Subsection (5)(iii), no act, or failure to act, on
         Executive's part shall be deemed "willful" unless done, or omitted to
         be done, by Executive not in good faith and without reasonable belief
         that the action or omission was in the best interest of the Employers.

                  (iv)     Voluntary Termination by Executive. Executive may
         voluntarily terminate his employment under this Agreement at any time
         by giving at least thirty (30) days prior written notice to Employers.
         In such event, Executive shall receive all compensation and other
         benefits in which he was vested or to which he was otherwise entitled
         under Section 4 through the date specified in such notice (the
         "Termination Date"), in addition to all other benefits available to him
         under benefit plans and programs to which he was entitled by reason of
         employment through the Termination Date.

                  (v)      Suspension or Termination Required by the OTS

                  (A)      If Executive is suspended and/or temporarily
                           prohibited from participating in the conduct of the
                           Employers' affairs by a notice served under section
                           8(e)(3), or section 8(g)(1), of the Federal Deposit
                           Insurance Act [12 U.S.C. Sections 1818(e)(3) and
                           (g)(1)], the Employers' obligations under the
                           Agreement shall be suspended as of the date of
                           service of the notice unless stayed by appropriate
                           proceedings. If the charges in the notice are
                           dismissed, the Employers shall (i) pay Executive all
                           of the compensation withheld while their obligations
                           under this Agreement were suspended, and (ii)
                           reinstate such obligations as were suspended.

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

                  (C)      If the Bank is in default as defined in section
                           3(x)(1) of the Federal Deposit Insurance Act [12
                           U.S.C. 1813 (x)(1)], all obligations under the



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                           Agreement shall terminate as of the date of default,
                           but this paragraph shall not affect any vested rights
                           of the Executive.

                  (D)      All obligations under the Agreement shall be
                           terminated, except to the extent determined that
                           continuation of the contract is necessary for the
                           Employers' continued operations (i) by the Director
                           of the OTS, or his or her designee at the time the
                           FDIC or Resolution Trust Corporation ("RTC") enters
                           into an agreement to provide assistance to or on
                           behalf of the Employers under the authority
                           contained in section 13(c) of the Federal Deposit
                           Insurance Act; or (ii) by the Director of the OTS,
                           or his or her designee, at the time it approves a
                           supervisory merger to resolve problems related to
                           operation of the Employers or when the Employers
                           are determined by the Director of the OTS 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.

                  (E)      In the event that 12 C.F.R. Section 563.39, or
                           any successor regulation, is repealed, this section
                           5(v) shall cease to be effective on the effective
                           date of such repeal.  In the event that 12 C.F.R.  
                           Section 563.39, or any successor regulation, is
                           amended or modified, this Agreement shall be revised
                           to reflect the amended or modified provisions if:
                           (1) the amended or modified provision is required to
                           be included in this Agreement; or (2) if not so
                           required, the Executive requests that the Agreement
                           be so revised.

                  (vi)     Other Termination. If this Agreement is terminated
         (1) by the Employers other than for cause, death, disability or
         retirement (and other than following a change in control as defined in
         Section 6), or (2) by Executive due to a failure by Employers to comply
         with any material provision of this Agreement, which failure has not
         been cured within thirty (30) days after notice of such non-compliance
         has been given by Executive to Employers; then following the
         Termination Date:

                  (A)      In lieu of any further salary payments to Executive
                           subsequent to the Termination Date, Executive shall
                           receive Severance Pay for a twelve (12) month
                           period in accordance with the Employers' normal
                           payroll practices, beginning with the first pay
                           date following the Termination Date.  The monthly
                           rate of Severance Pay shall be the monthly Base
                           Salary received by Executive (based on his highest
                           rate of Base Salary within the 3 years preceding



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                           his Termination Date) plus one-twelfth of the total
                           bonus and incentive compensation paid to or vested in
                           Executive on the basis of his most recently completed
                           calendar year of employment.

                  (B)      Employers shall maintain and provide for the period
                           during which Severance Payments are to be made and
                           ending at the earlier of (i) the expiration of such
                           period, or (ii) the date of the Executive's full-
                           time employment by another employer (provided that
                           the Executive is entitled under the terms of such
                           employment to benefits substantially similar to
                           those described in this subparagraph (B)), at no
                           cost to the Executive, the Executive's continued
                           participation in all group insurance, life
                           insurance, health and accident, disability and
                           other employee benefit plans, programs and
                           arrangements in which Executive was entitled to
                           participate immediately prior to the Termination
                           Date (other than retirement plans, deferred
                           compensation, or stock compensation plans of the
                           Employers), provided that in the event Executive's
                           participation in any plan, program or arrangement
                           as provided in this subparagraph (B) is barred, or
                           during such period any such plan, program or
                           arrangement is discontinued or the benefits
                           thereunder are materially reduced, the Employers
                           shall arrange to provide the Executive with
                           benefits substantially similar to those which the
                           Executive was entitled to receive under such plans,
                           programs and arrangements immediately prior to the
                           Termination Date.

                  (C)      In addition to such Severance Pay and continued
                           benefits, Executive shall receive all other
                           compensation and benefits in which he was vested or
                           to which he was otherwise entitled under Section 4
                           and the plans and programs provided therein by reason
                           of employment through the Termination Date.

         6.       Termination by Executive After Change in Control.

                  (i) Definition "Change in Control". For purposes of this
         Agreement, a "change in control" shall mean any change in control with
         respect to the Bank or Company that would be required to be reported in
         response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
         under the Securities Exchange Act of 1934, as amended ("Exchange Act")
         or any successor thereto; provided that, without limitation, a change
         in control shall be deemed to have occurred if (i) any "person" (as
         such term is used in Sections 13(d) and 14(d) of the Exchange Act) is
         or becomes the "beneficial owner" (as



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         defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
         of securities representing 25% or more of the combined voting power of
         the Bank's or Company's then outstanding securities; or (ii) during any
         period of two consecutive years, individuals who at the beginning of
         such period constituted the Board of Directors of the Bank or Company
         cease for any reason to constitute at least a majority thereof unless
         the election, or the nomination for election by stockholders, of each
         new director was approved by a vote of at least two-thirds of the
         directors then still in office who were directors at the beginning of
         the period.

              (ii)        Good Reason for Executive Termination. The Executive
         may terminate his employment under this Agreement for "good reason" by
         giving at least thirty (30) days prior written notice to the Bank at
         any time within twenty-four (24) months of the effective date of a
         change in control. Occurrence of any of the following events shall
         constitute good reason:

              (A)          Without the Executive's express written consent,
                           assignment by the Employers of any duties which are
                           materially inconsistent with Executive's positions,
                           duties, responsibilities and status with the
                           Employers immediately prior to a change in control,
                           or a material change in the Executive's reporting
                           responsibilities, titles or offices as in effect
                           immediately prior to such change in control, or any
                           removal of the Executive from or any failure to re-
                           elect the Executive to all or any portion of his
                           Corporate Position, except in connection with a
                           termination of Executive's employment for cause,
                           disability, retirement or death (or by the
                           Executive other than for good reason as defined in
                           this section 6(B)).

              (B)          Without the Executive's express written consent, a
                           reduction by the Employers in the Executive's Base
                           Salary as in effect on the date of the change in
                           control or as the same may have been increased from
                           time to time thereafter;

              (C)          The principal executive offices of either of the
                           Employers are relocated outside of the Milwaukee,
                           Wisconsin metropolitan area or, without the
                           Executive's express written consent, the Employers
                           require the Executive to be based anywhere other
                           than an area in which the Employers principal
                           executives offices are located, except for required
                           travel on business of the Employers to an extent
                           substantially consistent with the Executive's
                           present business travel obligations;



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              (D)          Without Executive's express written consent, the
                           Employers fail or refuse to continue Executive's
                           participation in incentive compensation and stock
                           incentive programs comparable to either (1) those
                           in effect prior to the change in control or (2)
                           those subsequently in effect for the senior
                           executives of any acquiring company effecting the
                           change in control;

              (E)          Without Executive's express written consent,
                           Employers fail to provide the Executive with the
                           same fringe benefits that were provided to
                           Executive immediately prior to a change in control,
                           or with a package of fringe benefits (including
                           paid vacations) that, though one or more of such
                           benefits may vary from those in effect immediately
                           prior to such change in control, is substantially
                           comparable in all material respects to such fringe
                           benefits taken as a whole;

              (F)          Any purported termination of the Executive's
                           employment for cause, disability or retirement which
                           is not effected in accordance with the notice
                           requirements applicable under this Agreement; or

              (G)          The failure by either of the Employers to obtain the
                           assumption of, or an agreement to perform this
                           Agreement by any successor as contemplated in Section
                           7(i) hereof;

              (iii)        Benefits Upon Termination by Executive After a 
"Change in Control". If this Agreement is terminated by Executive for good
reason following a change in control, then following the Termination Date:

              (A)          In lieu of any further salary payments to Executive
                           subsequent to the Termination Date, Executive shall
                           receive Severance Pay for the longer of (i) the
                           remaining unexpired term of the agreement as in
                           effect immediately prior to the Termination Date,
                           or (ii) a thirty-six (36) month period.  Payments
                           shall be made in accordance with the Employers'
                           normal payroll practices, beginning with the first
                           pay date following the Termination Date.  The
                           monthly rate of Severance Pay shall be the average
                           monthly Base Salary received by Executive (based on
                           his highest rate of Base Salary within the 3 years
                           preceding his Termination Date) plus one-twelfth of
                           the total bonus and incentive compensation paid to
                           or vested in Executive on the basis of his most
                           recently completed calendar year of employment.


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                  (B)      Employers shall maintain and provide for the period
                           during which Severance Payments are to be made and
                           ending at the earlier of (i) the expiration of such
                           period, or (ii) the date of the Executive's full-
                           time employment by another employer (provided that
                           the Executive is entitled under the terms of such
                           other employment to benefits substantially similar
                           to those described in this subparagraph (B)), at no
                           cost to the Executive, the Executive's continued
                           participation in all group insurance, life
                           insurance, health and accident, disability and
                           other employee benefit plans, programs and
                           arrangements in which the Executive was entitled to
                           participate immediately prior to the Termination
                           Date (other than retirement and deferred
                           compensation plans and individual insurance
                           policies covered under subsection 6(C) or stock
                           compensation plans of the Employers), provided that
                           in the event Executive's participation in any plan,
                           program or arrangement as provided in this
                           subparagraph (B) is barred, or during such period
                           any such plan, program or arrangement is
                           discontinued or the benefits thereunder are
                           materially reduced, the Employers shall arrange to
                           provide Executive with benefits substantially
                           similar to those Executive was entitled to receive
                           under such plans, programs and arrangements
                           immediately prior to the Termination Date.

                  (C)      Executive shall also receive all other compensation
                           and benefits in which he was vested or to which he
                           was otherwise entitled under section 4 and the
                           plans and programs provided therein by reason of
                           employment through the Termination Date.  In
                           addition to benefits to which Executive is entitled
                           under retirement and deferred compensation plans
                           and individual insurance policies maintained by
                           Employers (hereinafter collectively referred to as
                           "Plan"), Executive shall receive as additional
                           severance benefits a benefit paid under this
                           Agreement, which benefit shall be determined in
                           accordance with and paid under this Agreement, but
                           in the form and at the times provided in the Plan.
                           Such benefits shall be determined as if Executive
                           were fully vested under the Plan and had
                           accumulated (after any termination under this
                           Agreement) the additional years of credit service
                           under the applicable Plan that he would have
                           received had he continued in the employment of the
                           Bank for the period during which Severance Payments
                           are to be made and at the annual compensation level
                           represented by such payments.  Such Severance



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                           Payment level shall be deemed to represent the
                           compensation received by Executive during each such
                           additional year for purposes of determining his
                           additional benefits under this Subsection 6(C).

         (iv)     Limitation of Benefits under Certain Circumstances.  If
the severance benefits payable to Executive under this Section 6
("Severance Benefits"), or any other payments or benefits received
or to be received by Executive from Employers (whether payable
pursuant to the terms of this Agreement, any other plan, agreement
or arrangement with the Employers or any corporation affiliated
with the Employers ("Affiliate") within the meaning of Section 1504
of the Internal Revenue Code of 1954, as amended (the "Code")), in
the opinion of tax counsel selected by the Employers's independent
auditors and acceptable to Executive, constitute "parachute
payments" within the meaning of Section 280G(b)(2) of the Code, and
the present value of such "parachute payments" equals or exceeds
three times the average of the annual compensation payable to
Executive by the Employers (or an Affiliate) and includable in
Executive's gross income for federal income tax purposes for the
five (5) calendar years preceding the year in which a change in
ownership or control of the Employers occurred ("Base Amount"),
such Severance Benefits shall be reduced, in a manner determined by
Executive, to an amount the present value of which (when combined
with the present value of any other payments or benefits otherwise
received or to be received by Executive from the Employers (or an
Affiliate) that are deemed "parachute payments") is equal to 2.99
times the Base Amount, notwithstanding any other provision to the
contrary in this Agreement.  The Severance Benefits shall not be
reduced if (A) Executive shall have effectively waived his receipt
or enjoyment of any such payment or benefit which triggered the
applicability of this Section 6(iv), or (B) in the opinion of such
tax counsel, the Severance Benefits (in its full amount or as
partially reduced, as the case may be) plus all other payments or
benefits which constitute "parachute payments" within the meaning
of Section 280G(b)(2) of the Code are reasonable compensation for
services actually rendered, within the meaning of Section 280G
(b)(4) of the code, and such payments are deductible by the
Employers.  The Base Amount shall include every type and form of
compensation includable in Executive's gross income in respect of
his employment by the Employers (or an Affiliate), except to the
extent otherwise provided in temporary or final regulations
promulgated under Section 280G (b) of the Code.  For purposes of
this Section 6(iv), a "change in ownership or control" shall have
the meaning set forth in Section 280G(b) of the Code and any
temporary or final  regulations promulgated thereunder.  The
present value of any non-cash benefit or any deferred cash payment
shall be determined by the Employers' independent auditors in
accordance with the principles of Sections 280G (b)(3) and (4) of
the Code.

         In the event that Employers and/or the Executive do not agree



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with the opinion of such counsel, (A) Employers shall pay to the Executive the
maximum amount of payments and benefits pursuant to Section 6, as selected by
the Executive, which in the opinion of counsel may be made without a substantial
risk that such payments and benefits will be treated as non-deductible to the
Employers and subject to the excise tax imposed under Section 4999 of the Code
and (B) Employers may request, and Executive shall have the right to demand the
Employers request, a ruling from the IRS as to whether the disputed payments and
benefits pursuant to Section 6 hereof have such consequences. Any such request
for a ruling from the IRS shall be promptly prepared and filed by the Employers,
but in no event later than thirty (30) days from the date of the opinion of
counsel referred to above, and shall be subject to Executive's approval prior to
filing, which shall not be unreasonably withheld. Employers and Executive agree
to be bound by any ruling received from the IRS and to make appropriate payments
to each other to reflect any such rulings, together with interest at the
applicable federal rate provided for in Section 7872(f)(2) of the Code. Nothing
contained herein shall result in a reduction of any payments or benefits to
which the Executive may be entitled upon termination of employment under any
circumstances other than as specified herein or a reduction in payments and
benefits other than those provided in this Section 6.

         In the event that Section 280G, or any successor statute, is repealed,
this Section 6 shall cease to be effective on the effective date of such repeal.
The parties to this Agreement recognize that final regulations under Section
280G of the Code may affect the amounts that may be paid under this Agreement
and agreed that, upon issuance of such final regulations this Agreement may be
modified as in good faith deemed necessary in light of the provisions of such
regulations to achieve the purposes of this Agreement, and that consent to such
modifications shall not be unreasonably withheld.

         7.  General Provisions.

               (i)      Successors; Binding Agreement.

               (A)      Employers will require any successor (whether
                        direct or indirect, by purchase, merger,
                        consolidation or otherwise) to all or substantially
                        all of the business and/or assets of the Employers
                        ("successor organization") to expressly assume and
                        agree to perform this Agreement in the same manner
                        and to the same extent that Employers would have
                        been required to perform if no such succession had
                        taken place or to re-execute this Agreement as
                        provided pursuant to section 6(ii)(G).  If such
                        succession is the result of a "change in control"
                        as defined herein, such assumption shall
                        specifically preserve to Executive, for the greater



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<PAGE>   14



                           of twenty-four (24) months or the then remaining term
                           of this Agreement, the same rights and remedies
                           (recognizing them as being available and applicable
                           as the result of the "change in control" effectuating
                           said succession) as provided under this Agreement
                           upon a "change in control".

                                    As used in this Agreement "Employers" shall
                           mean the Employers as hereinbefore defined (and any
                           successor to their business and/or assets) which
                           executes and delivers the agreement provided for in
                           this Section 7 or which otherwise becomes bound by
                           the terms and provisions of this Agreement by
                           operation of this Agreement or law. Failure of the
                           Employers to obtain such agreement prior to the
                           effectiveness of any such succession shall be a
                           breach of this Agreement and shall entitle Executive,
                           if he elects to terminate this Agreement, to
                           compensation from the Employers in the same amount
                           and on the same terms as he would be entitled to
                           under this Agreement if he terminated his employment
                           under Section 6. For purposes of implementing the
                           foregoing, the date on which any such succession
                           becomes effective shall be deemed the Termination
                           Date.

                  (B)      No right or interest to or in any payments or
                           benefits under this agreement shall be assignable or
                           transferable in any respect by the Executive, nor
                           shall any such payment, right or interest be subject
                           to seizure, attachment or creditor's process for
                           payment of any debts, judgments, or obligations of
                           Executive.

                  (C)      This Agreement shall be binding upon and inure to the
                           benefit of and be enforceable by (1) Executive and
                           his heirs, beneficiaries and personal
                           representatives, and (2) the Employers and any
                           successor organization.

                  (ii)     Noncompetition Provision. Executive acknowledges that
         the development of personal contacts and relationships is an essential
         element of the savings and loan business, that Employers has invested
         considerable time and money in his development of such contacts and
         relationships, that Employers could suffer irreparable harm if he were
         to leave employment and solicit the business of the Employers
         customers, and that it is reasonable to protect the Employers against
         competitive activities by Executive. Executive covenants and agrees, in
         recognition of the foregoing and in consideration of the mutual
         promises contained herein, that in the event of a voluntary termination
         of employment by Executive pursuant to



                                      -14-

<PAGE>   15



         Section 5(iii), or upon expiration of this Agreement as a result of
         Executive's election (but not as the result of an election by
         Employers) not to continue automatic annual renewals, Executive shall
         not accept employment with any Significant Competitor of Bank for a
         period of twelve (12) months following such termination. For purposes
         of this Agreement, the term Significant Competitor means any financial
         institution including, but not limited to, any commercial bank, savings
         bank, savings and loan association, credit union, or mortgage banking
         corporation which, at the time of termination of Executive's
         employment, or during the period of this covenant not to compete, has a
         home, branch or other office in Milwaukee County or which has, during
         the twelve (12) months preceding Executive's termination, originated,
         or which during the period of this covenant not to compete originates,
         more than $50,000,000 in commercial or mortgage loans secured by real
         property in any such county.

                  Executive agrees that the non-competition provisions set forth
         herein are necessary for the protection of the Employers and are
         reasonably limited as to (i) the scope of activities affected, (ii)
         their duration and geographic scope, and (iii) their effect on
         Executive and the public. In the event Executive violates the
         non-competition provisions set forth herein, the Employers shall be
         entitled, in addition to its other legal remedies, to enjoin the
         employment of Executive with any Significant Competitor for the period
         set forth herein. If Executive violates this covenant and the Employers
         bring legal action for injunctive or other relief, the Employers shall
         not, as a result of the time involved in obtaining such relief, be
         deprived of the benefit of the full period of the restrictive covenant.
         Accordingly, the covenant shall be deemed to have the duration
         specified herein, computed from the date such relief is granted, but
         reduced by any period between commencement of the period and the date
         of the first violation.

                  (iii) Notice. For purposes of this Agreement, notices and all
         other communications provided for in the Agreement shall be in writing
         and shall be deemed to have been duly given when delivered or mailed by
         United States registered mail, return receipt requested, postage
         prepaid, addressed as follows:

                  If to the Bank or Company:

                            St. Francis Capital Corporation
                            3545 South Kinnickinnic Avenue
                            Milwaukee, Wisconsin 53207
                            Attn: Secretary



                                      -15-

<PAGE>   16



                  If to the Executive:

                            Mr. Jon D. Sorenson



         or to such other address as either party may have furnished to the
         other in writing in accordance herewith, except that notice of change
         of address shall be effective only upon receipt.

                  (iv) Expenses. If any legal proceeding is necessary to enforce
         or interpret the terms of this Agreement (or to recover damages for
         breach of it) in the absence of a change in control, the prevailing
         party shall be entitled to recover from the other party reasonable
         attorneys' fees and necessary costs and disbursements incurred in such
         litigation, in addition to any other relief to which such prevailing
         party may be entitled.

                  Notwithstanding the foregoing, in the event of a legal
         proceeding to enforce or interpret the terms of this Agreement
         following a change in control or a re-execution of this Agreement
         pursuant to section 6(ii)(G), the only recoverable costs shall be those
         which Executive shall be entitled to recover from the Bank (i.e.
         reasonable attorneys' fees and necessary costs and disbursements
         incurred in such litigation), which fees shall be recoverable only if
         the Executive is the prevailing party. Recovery of attorneys' fees and
         costs as provided herein following a change in control or re-execution
         shall be in addition to any other relief to which Executive may be
         entitled.

                  (v) Withholding. Employers shall be entitled to withhold from
         amounts to be paid to Executive under this Agreement any federal,
         state, or local withholding or other taxes or charges which it is from
         time to time required to withhold. Employers shall be entitled to rely
         on an opinion of counsel if any question as to the amount or
         requirement of any such withholding shall arise.

                  (vi) Notice of Termination. Any purported termination by the
         Employers under Sections 5(i), (ii), (iii) or (iv), or by Executive
         under Sections 5(vi) or 6(ii) shall be communicated by written "Notice
         of Termination" to the other party. For purposes of this Agreement, a
         "Notice of Termination" shall mean a dated notice which (i) indicates
         the specific termination provision in this Agreement relied upon, (ii)
         sets forth in reasonable detail the facts and circumstances claimed to
         provide a basis for termination under the provision so indicated, (iii)
         specifies a Date of Termination, which shall be not less than thirty
         (30) nor more

                                      -16-

<PAGE>   17



         than ninety (90) days after such Notice of Termination is given, except
         in the case of termination of Executive's employment for Cause; and
         (iv) is given in the manner specified in Section 7(iii) of this
         Agreement.

                  (vii) Miscellaneous. No provision of this Agreement may be
         amended, waived or discharged unless such amendment, waiver or
         discharge is agreed to in writing and signed by Executive and such
         officers of the Employers as may be specifically designated by the
         Board. No waiver by either party hereto at any time of any breach by
         the other party hereto of, or compliance with, any condition or
         provision of this Agreement to be performed by such other party shall
         be deemed a waiver of similar or dissimilar provisions or conditions at
         the same or at any prior or subsequent time. No agreements or
         representations, oral or otherwise, express or implied, with respect to
         the subject matter hereof have been made by either party which are not
         expressly set forth in this Agreement and it is agreed that execution
         of this Agreement shall result in its superseding and extinguishing any
         rights of Executive under any other employment agreement previously in
         effect between himself, the Employers, or any of their affiliates. The
         validity, interpretation, construction and performance of this
         Agreement shall be governed by the laws of the State of Wisconsin.

                  (viii) Mitigation; Exclusivity of Benefits. The Executive
         shall not be required to mitigate the amount of any benefits hereunder
         by seeking other employment or otherwise, nor shall the amount of any
         such benefits be reduced by any compensation earned by the Executive as
         a result of employment by another employer after the Termination Date
         or otherwise.

                  (ix) Validity. The invalidity or unenforceability of any
         provision of this Agreement shall not affect the validity or
         enforceability of any other provision of this Agreement, which shall
         remain in full force and effect.

                  (x) Counterparts. This Agreement may be executed in several
         counterparts, each of which together will constitute one and the same
         instrument.

                  (xi) Headings. Headings contained in this Agreement are for
         reference only and shall not affect the meaning or interpretation of
         any provision of this Agreement.

                  (xii) Effective Date. The effective date of this Agreement
         shall be the date indicated in the first section of this Agreement,
         notwithstanding the actual date of execution by any party.



                                      -17-

<PAGE>   18



         IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as of the date first above written.

                                            Executive:



                                            /s/ Jon D. Sorenson
                                            ----------------------------------
                                            Jon D. Sorenson



                                            ST. FRANCIS CAPITAL CORPORATION



                                            By:  /s/ William R. Hotz
                                                 -----------------------------
                                            Its:  Executive Vice President,
                                                  Secretary and General Counsel



                                            ST. FRANCIS BANK, F.S.B.



                                            By:  /s/ Judith M. Gauvin
                                                 -----------------------------
                                            Its:  Senior Vice President -
                                                  Human Resourses








                                      -18-