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                                                                    EXHIBIT 10.3


                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT, dated as of the 1st day of June, 2002, by and among
Tarpon Coast Bancorp, Inc., a Florida corporation (the "Holding Company"),
Tarpon Coast National Bank a national bank organized under the laws of the
United States (the "Bank") (collectively referred to herein as the "Employer"),
and Todd H. Katz (the "Executive").

                                  WITNESSETH:

         WHEREAS, the Boards of Directors of the Employer desire to employ
Executive to serve as Vice Chairman of the Board & President of the Holding
Company and the Bank; and

         WHEREAS, Executive is willing to become employed by the Holding
Company and the Bank as Vice Chairman and President in accordance with the
terms and conditions hereinafter set forth:

1.       Employment. Employer employs Executive and Executive accepts
         employment upon the terms and conditions set forth in this Agreement.

2.       Term. The term of employment of Executive under this Agreement shall
         be for nineteen (19) months and commence on June 1, 2002. If this
         contract is not renewed or renegotiated prior to the end of its term,
         it will be treated as a termination without cause and compensated as
         indicated in paragraph 11.b.

3.       Compensation. For all services rendered by Executive, Executive shall
         be paid a minimum annual base salary of $135,000 per year until March
         1, 2003. Commencing March 1, 2003, the minimum annual base salary will
         become $158,000 per year. The minimum annual base salary will be paid
         by the Bank in equal semi-monthly installments during the term of this
         Agreement. Salary payments shall be subject to withholding and other
         applicable taxes.

4.       Title and Duties. Executive shall serve as Vice Chairman of the Board
         and President of the Holding Company and of the Bank. Executive shall
         run the day-to-day operating activities of the Holding Company and the
         Bank and assist the Chief Executive Officer in managing the Holding
         Company's and Bank's affairs; lead the Bank's efforts at community
         relations and business development; coordinate all marketing efforts;
         serve as internal legal counsel and human resources officer; and serve
         as compliance and CRA officer.

5.       Extent of Services. Executive shall devote his entire time, attention
         and energies to the business of Employer and shall not during the term
         of this Agreement be engaged in any other business activity which
         requires the attention or participation of Executive during normal
         business hours of Employer, recognition being given to the fact that
         Executive is expected on occasion to participate in client development
         after normal business hours. However, Executive may invest his assets
         in such form or manner as will not require his services in the
         operation of the affairs of the companies in which such investments
         are made, except that Executive shall not make an investment in the
         securities of any competing financial institution without the express
         approval of the Boards of Directors of the Employer. Executive shall
         notify Employer of any significant participation by him in any trade
         association or similar organization.

6.       Working Facilities. Executive shall receive from the Bank, such
         assistants, perquisites, facilities and services as are suitable to
         his position and appropriate for the performance of his duties on
         behalf of such entity. In addition, the Bank shall provide Executive
         membership in a country or social club (including dues, assessments
         and initiation fees) of his choice and Executive shall have the option
         at the termination of his employment for any reason to repurchase said
         membership from the Bank.

7.       Expenses. Executive may incur reasonable expenses for promoting the
         business of the Bank, including expenses for entertainment, travel,
         and similar items. Executive will be reimbursed by the Bank for all
         such expenses upon Executive's periodic presentation of an itemized
         account of such expenditures with receipts attached.

8.       Vacations. Executive shall be entitled each year to four (4) weeks of
         vacation time in accordance with the personnel policy established by
         the Bank's Board of Directors, during which time Executive's
         compensation shall be paid in full.


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9.       Additional Compensation. As additional consideration paid to
         Executive, Executive shall be provided with and participate in all
         employee benefit plans offered by the Bank to all of its employees,
         including health, hospitalization, disability, life insurance, travel
         insurance, bonus, retirement and savings plans. In addition, Executive
         shall be provided with a term life insurance policy of at least
         $200,000, which shall include an accidental death or dismemberment
         provision of two times the face amount of the policy.

10.      Change in Control of the Bank.

         a.       In the event of a "change in control" of the Employer, as
                  defined herein, and only to the extend permitted by
                  applicable statutes and regulations, Executive shall be
                  entitled, for a period of thirty (30) days from the date of
                  closing of the transaction effecting such change in control
                  and at his election, to give written notice to Employer of
                  termination of this Agreement and to receive a cash payment
                  equal to one time (100%) the compensation, including
                  incentive compensation, if any, received by Executive in the
                  one-year period immediately preceding the change in control.
                  The severance payments provided for in this Section 10.a.
                  shall be paid in cash, commencing not later than ten (10)
                  days after the date of notice of termination by Executive
                  under this Section 10 or ten (10) days after the date of
                  closing of the transaction effecting the change in control of
                  the Employer, whichever is later.

         b.       In addition, if Executive elects to terminate this Agreement
                  pursuant to this Section 10, Executive shall further be
                  entitled, in lieu of shares of Common Stock of the Holding
                  Company issuable upon exercise of stock options to which
                  Executive is entitled, an amount in cash or Common Stock of
                  the Holding Company or any other company into which shares of
                  the Holding Company are convertible (or any combination
                  thereof) as Executive shall in his election designate equal
                  to the excess of the fair market value of the Common Stock as
                  of the date of closing of the transaction effecting the
                  change in control over the per share exercise price of the
                  options held by Executive, times the number of shares of
                  Common Stock subject to such options (whether or not then
                  fully exercisable). The fair market value of the Common Stock
                  shall be equal to the higher of (i) the value as determined
                  by the Board of Directors of the Holding Company if there is
                  no organized trading market for the shares at the time such
                  determination is made, which per share value shall not be
                  less than 1.8 times the per share book value of the stock or
                  (ii) the closing price (or the average of the bid and asked
                  prices if no closing price is available) on any nationally
                  recognized securities exchange or association on which the
                  Holding Company's shares may be quoted or listed, or (iii)
                  the highest per share price actually paid for Common Stock of
                  the Holding Company in connection with any change in control
                  of the Employer. The severance payments provided for in this
                  Section 10.b. shall be paid in full not later than ten (10)
                  days after the date of notice of termination by Executive
                  under this Section 10 or ten (10) days after the date of
                  closing of the transaction effecting the change in control of
                  the Employer, whichever is later.

         d.       Further, upon a "change in control", the Company and the Bank
                  shall cause the Key Man whole life insurance policy on
                  Executive in the face amount of $500,000, currently owned by
                  and maintained for the benefit of the Company and the Bank,
                  to be conveyed to Executive on a fully paid-up basis. The
                  Company and the Bank, in so doing, will relinquish any
                  interest in benefits under the policy. During the term of
                  this agreement and any extensions and renewals thereof, the
                  Company and the Bank shall continue to fund premiums in such
                  amounts to ensure the continuation of benefits under the
                  policy. This conveyance is not contingent upon the notice
                  requirements set forth in this Section 10.

         d.       For purposes of this Section 10, "change in control" of the
                  Employer shall mean:

                  1.       any transaction, whether by merger, consolidation,
                           asset sale, tender offer, reverse stock split, or
                           otherwise, which results in the acquisition or
                           beneficial ownership (as such term is defined under
                           rules and regulations promulgated under the
                           Securities Exchange Act of 1934, as amended) by any
                           person or entity or group of persons or entities
                           acting in concert, of 50% or more of the outstanding
                           shares of Common Stock of the Employer.

                  2.       the sale of all or substantially all of the assets
                           of the Employer; or

                  3.       the liquidation of the Employer.

         e.       If any payments to be made under this Section 10 constitute
                  an "Excess Parachute Payment" as that term is defined in
                  Section 280(g) of the Internal Revenue Code, the payments
                  shall be reduced to the largest amount which would not
                  constitute an "Excess Parachute Payment."


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11.      Termination.

         a.       For Cause. This Agreement may be terminated by the Boards of
                  Directors of the Employer without notice and without further
                  obligations other than for monies already paid, for any of
                  the following reasons:

                  i.       failure of Executive to follow reasonable written
                           instructions or policies of the Boards of Directors
                           of the Employer;

                  ii.      gross negligence or willful misconduct of Executive
                           materially damaging to the business of the Employer
                           during the term of this Agreement, or at any time
                           while he was employed by the Employer prior to the
                           term of this Agreement, if not disclosed to the
                           Employer prior to the commencement of the term of
                           this Agreement; or

                  iii.     conviction of Executive during the term of this
                           Agreement of a crime involving breach of trust or
                           moral turpitude; or

                  iv.      at the request of any bank regulatory authority with
                           jurisdiction over the Employer.

                           In the event that the Employer discharges Executive
                  alleging "cause" under this Section 11.a. and it is
                  subsequently determined judicially that the termination was
                  "without cause," then such discharge shall be deemed a
                  discharge without cause subject to the provisions of Section
                  11.b. hereof. In the event that the Employer discharges
                  Executive alleging "cause" under this Section 11.a, such
                  notice of discharge shall be accompanied by a written and
                  specific description of the circumstances alleging such
                  "cause". The termination of Executive for "cause" shall not
                  entitle the Employer to enforcement of the non-competition
                  and non-solicitation covenants contained in Section 13
                  hereof, unless the employee purposely engages in conduct
                  constituting "cause" for the purpose of negating the
                  non-competition provision.

         b.       Without Cause.

                  i.       Notwithstanding the provisions of Section 2 of this
                           Agreement, the Employer may, upon thirty (30) days'
                           written notice to Executive, or by the giving of a
                           notice under Section 2 of this Agreement terminate
                           this Agreement without cause at any time during the
                           term of this Agreement upon the condition that
                           Executive shall be entitled, as liquidated damages
                           in lieu of all other claims, to the same severance
                           payments as provided in Section 10 hereof; provided
                           that for purposes of Section 10.b., the fair market
                           value of Common Stock shall be determined as of the
                           date of notice of termination of this Agreement
                           given by the Employer to Executive. The severance
                           payments provided for in this Section 11.b. shall
                           commence not later than thirty (30) days after the
                           actual date of termination of employment of
                           Executive.

                  ii.      Executive may upon thirty (30) days' written notice
                           to Employer terminate his Agreement without cause at
                           any time during the term of this Agreement. In the
                           event of termination of this Agreement by Executive,
                           the Employer shall have no further obligation to
                           Executive than for monies paid.

12.      Death or Disability.

         a.       In the event of Executive's death during the term of this
                  Agreement, Employer shall pay to Executive's designated
                  beneficiary, or if Executive has failed to designate a
                  beneficiary, to his estate, an amount equal to Executive's
                  base salary pursuant to Section 3 hereof through the end of
                  the month in which Executive's death occurred plus an amount
                  equal to ninety (90) days salary. Employer shall also
                  continue to provide Executive's survivors with any benefits
                  it provided Executive for such additional ninety (90) day
                  period.

         b.       In the event of Executive's disability during the term of
                  this Agreement, Employer shall pay to Executive an amount
                  equal to Executive's base salary pursuant to Section 3 hereof
                  through the end of the month in which Executive's disability
                  occurred plus an amount equal to six (6) months salary.
                  Employer shall also continue to provide Executive with any
                  benefits it provided Executive prior to his disability for a
                  period of six (6) months following his disability and shall
                  continue to pay the premiums on any life and disability
                  policies provided by the Employer for the benefit of
                  Executive prior to his disability.


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         c.       The compensation set forth in Sections a. and b. of this
                  Section 12 shall be in lieu of any other benefits provided
                  hereunder, except that (i) in the event of a change in
                  control of the Employer as defined herein during the ninety
                  (90) day or six (6) month periods described in Sections a.
                  and b. of this Section 12, Executive, Executive's designated
                  beneficiary or Executive's estate, as the case may be, shall
                  be entitled to the benefits of Section 10.b. hereof, and (ii)
                  any benefit payable pursuant to Section 3 shall be prorated
                  and made available to Executive or his beneficiary or estate
                  in respect of any period prior to his death or disability.
                  and (iii) in the event of Executive's disability, Employer
                  shall continue to pay the premiums on any life and disability
                  policies provided by the Employer for the benefit of
                  Executive prior to his disability. The Employer may maintain
                  insurance on its behalf to satisfy in whole or in part the
                  obligations of this Section 12.

         d.       Executive shall be deemed disabled if, by reason of physical
                  or mental impairment, he is incapable of performing his
                  duties hereunder for a period of 180 consecutive days.

13.      Notices. Any notice required or desired to be given under this
         Agreement shall be deemed given if in writing sent by certified mail
         to his residence in the case of Executive, or to its principal office
         in the case of Employer.

14.      Waiver of Breach. The waiver of Employer of a breach of any provision
         of this Agreement by Executive shall not operate or be construed as a
         waiver of any subsequent breach by Executive. No waiver shall be valid
         unless in writing and signed by an authorized officer of Employer.

15.      Assignment. Executive acknowledges that the services to be rendered by
         him are unique and personal. Accordingly, Executive may not assign any
         of his rights or delegate any of his duties or obligations under this
         Agreement. The rights and obligations of Executive under this
         Agreement shall inure to the benefit of and shall be binding upon the
         successors and assigns of Employer.

16.      Governing Law. This Agreement shall be governed and construed in
         accordance with the laws of the State of Florida.

17.      Entire Agreement. This Agreement contains the entire understanding of
         the parties hereto regarding employment of Executive, and supersedes
         and replaces any prior agreement relating thereto. It may not be
         changed orally but only by an agreement in writing signed by the party
         against whom enforcement of any waiver, change, modification,
         extension, or discharge is sought.

                           WHEREAS, as of the day and date first above set
                  forth, the parties hereto execute this Agreement.


                  TARPON COAST BANCORP, INC.


                  By /s/ Mark O. Asperilla
                    -----------------------------------
                    Mark O. Asperilla
                    Chairman, Compensation Committee


                  TARPON COAST NATIONAL BANK


                  By /s/ Mark O. Asperilla
                    -----------------------------------
                    Mark O. Asperilla
                    Chairman, Compensation Committee


                  TODD H. KATZ

                  /s/ Todd H. Katz
                  -----------------------------------------
                  Executive