Exhibit 10.9

                              EMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT (this "Agreement") is dated this 30th day of
December 1998, by and among First Federal Savings and Loan ("First Federal"), a
federally chartered savings bank located in Defiance, Ohio, and Gregory R. Allen
(the "Executive").

                              W I T N E S S E T H:

      WHEREAS, First Federal desires to retain the Executive's services as the
Executive Vice President - Lending of First Federal; and

      WHEREAS, in order to induce the Executive to enter into and remain in the
employ of First Federal and in consideration of the Executive's agreeing to
enter into and remain in the employ of First Federal, the parties desire to
specify the terms of such employment;

      NOW THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the parties hereby agree as follows;

      1. Definitions. The following words and terms shall have the meanings set
forth below for the purposes of this Agreement:

            (a) Annual Compensation. The Executive's "Annual Compensation" for
purposes of this Agreement shall mean the greater of (i) $80,000 or (ii) the
average annual Compensation paid to the Executive by First Federal during the
five most recent taxable years ending prior to the Date of Termination, or such
fewer number of years as the Executive shall have been employed by the First
Federal prior to the Date of Termination.

            (b) Base Salary. "Base Salary" shall have the meaning set forth in
Section 3(a) hereof.

            (c) Bonus. "Bonus" shall have the meaning set forth in Section 3(a)
hereof.

            (d) Cause. "Cause" shall mean personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any law, rule
or regulation (other than traffic violations or similar offenses) or final
cease-and-desist order or material breach of any provision of this Agreement.
For purposes of this paragraph, no act or failure to act on the Executive's part
shall be considered "willful" unless done, or omitted to be done, by the
Executive not in good faith and without reasonable belief that the Executive's
action


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or omission was in the best interest of the First Federal.


            (e) Change in Control of First Defiance. "Change in Control of First
Defiance" shall mean a change in control of a nature 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 (the "Exchange Act"), or any successor thereto,
whether or not First Defiance is registered under the Exchange Act; provided
that, without limitation, such 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 defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of First
Defiance representing 25% or more of the combined voting power of the then
outstanding securities of First Defiance; or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors of First Defiance cease for any reason to constitute at
least a majority thereof unless the election, or the nomination for election by
shareholders, 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.

            (f) Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended.

            (g) Compensation. "Compensation" shall have the meaning set forth in
Section 3(a) hereof.

            (h) Date of Termination. "Date of Termination" shall mean (i) if the
Executive's employment is terminated by First Federal for any reason, the date
on which a Notice of Termination is given or such later date as may be specified
by First Federal in such Notice, or (ii) if the Executive's employment is
terminated by the Executive, the date of termination shall be a date not less
than 30 days from the date the Notice of Termination is delivered by the
Executive to the First Federal, unless First Federal, in their sole discretion,
designate an earlier date.

            (i) Disability. "Disability" shall mean any physical or mental
impairment which qualifies the Executive for disability benefits under the
applicable long-term disability plan maintained by First Federal or any
subsidiary or, if no such plan applies, which would qualify the Executive for
disability benefits under the federal Social Security System.

            ( ) First Defiance. "First Defiance" shall mean First Defiance
Financial Corp., an Ohio corporation which owns all of the issued and
outstanding stock of First Federal.

            (j) Good Reason. "Good Reason" shall mean:


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                  (i) The occurrence of any of the following events, without the
Executive's express written consent: (A) the assignment by First Federal to the
Executive of any duties which, in the Executive's good faith determination, are
materially inconsistent with the Executive's positions, duties, responsibilities
and status with First Federal immediately prior to such assignment or, in the
event of a Change in Control, immediately prior to such a Change in Control of
First Defiance; (B) in the Executive's good faith determination, a material
change in the Executive's reporting responsibilities, titles or offices as an
employee and as in effect immediately prior to such change or, in the event of a
Change in Control, immediately prior to such a Change in Control of First
Defiance; or (C) any removal of the Executive from or any failure to re-elect
the Executive to the offices of Sr. Vice President of First Federal, except in
connection with Cause, Disability, Retirement or the Executive's death;

                  (ii) Without the Executive's express written consent, a
reduction by the Companies in the Executive's Base Salary, as the same may be
increased from time to time, or fringe benefits;

                  (iii) The principal executive office of First Federal is
relocated outside of the Defiance, Ohio area or, without the Executive's express
written consent, First Federal require the Executive to be based anywhere other
than an area in which First Federal's principal executive office is located,
except for required travel on business of First Federal to an extent
substantially consistent with the Executive's present business travel
obligations;

                  (iv) Without the Executive's express written consent, First
Federal fail to provide the Executive with the same fringe benefits that were
provided to the Executive immediately prior to a Change in Control of First
Defiance, 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;

                  (v) Any purported termination of the Executive's employment
for Cause, Disability or Retirement which is not effected pursuant to a Notice
of Termination satisfying the requirements of paragraph (j) below; or

                  (vi) The failure by First Federal to obtain the assumption of
and agreement to perform this Agreement by any successor as contemplated in
Section 9 hereof.

            a. IRS. IRS shall mean the Internal Revenue Service.

            (l) Notice of Termination. "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 of the Executive's
employment under the provision so


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indicated, (iii) specifies a Date of Termination, and (iv) is given in the
manner specified in Section 10 hereof.

            (m) Retirement. "Retirement" shall mean voluntary termination by the
Employee in accordance with First Federal's retirement policies, including early
retirement, generally applicable to their salaried employees.

      2. Term of Employment.

            (a) First Federal hereby employs the Executive, and the Executive
hereby accepts employment with First Federal and agrees to render services to
First Federal on the terms and conditions set forth in this Agreement. The term
of employment under this Agreement shall commence on January 1, 1999 and shall
terminate on December 31, 2001, unless extended by

First Federal's Boards of Directors in the manner provided below, or unless
sooner terminated by First Federal or the Executive pursuant to Section 5 of
this Agreement.

            (b) At a meeting of First Federal's Boards of Directors prior to the
first anniversary of the date of this Agreement and each anniversary thereafter,
the Board of Directors of First Federal shall consider and review a one-year
extension of the term under this Agreement, and (with appropriate corporate
documentation thereof, and after taking into account all relevant factors
including the Executive's performance hereunder and the merits of a three-year
agreement) the term shall be extended, unless either the Board of Directors does
not approve such extension and provides written notice to the Executive of such
event or the Executive gives written notice to First Federal of the Executive's
election not to extend the term, in each case, with such written notice to be
given not less than thirty (30) days prior to any such anniversary date.
References herein to the term of this Agreement shall refer both to the initial
term and successive terms.

            (c) During the term of this Agreement, the Executive shall perform
such executive services for First Federal as may be consistent with his titles
and from time to time assigned to him by First Federal's Board of Directors,
provided, however, that the Executive shall not be precluded from (i) vacations
and other leave time in accordance with Section 3(c) below, (ii) reasonable
participation in community, civic, charitable, or similar organizations, (iii)
reasonable participation in industry-related activities, or (iv) pursuing
personal investments which do not interfere or conflict with the performance of
Executive's duties to First Federal.

      3. Compensation and Benefits.

            (a) First Federal shall compensate and pay Executive for his
services during the term of this Agreement at a minimum base annual salary of $
80,000 (the "Base Salary"), which may be increased from time to time in such
amounts as may be determined by First Federal's Board of Directors and may not
be decreased without the Executive's express written consent. In addition to the
Base Salary, the Executive shall


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be entitled to receive each year during the term of this Agreement a bonus of up
to 25% of the Executive's Base Salary based on targets set forth from time to
time in First Federal's incentive bonus program (the "Bonus"). The Executive's
Base Salary and Bonus are referred to herein as his "Compensation".

            (b) During the term of the Agreement, Executive shall be entitled to
participate in and receive the benefits of any pension or other retirement
benefit plan, deferred compensation, profit sharing, stock option, management
recognition, employee stock ownership, or other plans, benefits and privileges
given to employees and executives of First Federal, to the extent commensurate
with his then duties and responsibilities, as fixed by the Board of Directors of
First Federal including but not limited to the following: (i) First Federal
shall pay membership dues for the Executive for membership in the Rotary Club
and the Kettenring Country Club; and (ii) First Federal shall provide Executive
with use of an automobile (the terms and conditions for the Executive's use and
possession of the automobile and the quality of the automobile provided for the
Executive's use shall be consistent with, or not less favorable than, the past
practice of First Federal); First Federal 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 First Federal and does not result in a
proportionately greater adverse change in the rights of or benefits to Executive
as compared with any other executive officer of First Federal. Nothing paid to
Executive under any plan or arrangement presently in effect or made available in
the future shall be deemed to be in lieu of the salary payable to Executive
pursuant to Section 3(a) hereof.

            (c) During the term of this Agreement, Executive shall be entitled
to paid annual vacation in accordance with the policies established from time to
time by the Board of Directors of First Federal, which shall in no event be less
than four weeks per annum. The Executive shall not be entitled to receive any
additional compensation from First Federal for failure to take a vacation, nor
shall Executive be able to accumulate unused vacation time from one year to the
next, except to the extent authorized by the Board of Directors of First
Federal.

            (d) The Executive may receive additional compensation, based on
growth in First Federal's loan portfolio, in such amount as the Board of
Directors of First Federal may determine from time to time in its sole
discretion.

      4. Expenses. First Federal shall reimburse Executive or otherwise provide
for or pay for all reasonable expenses incurred by Executive in furtherance of
or in connection with the business of First Federal, including, but not by way
of limitation, traveling expenses and all reasonable entertainment expenses
(whether incurred at the Executive's residence, while traveling or otherwise),
subject to such reasonable documentation and other limitations as may be
established by the Board of Directors of First Federal. If such expenses are
paid in the first instance by Executive, First Federal shall reimburse the
Executive therefor.


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      5. Termination.

            (a) First Federal shall have the right, at any time upon prior
Notice of Termination, to terminate the Executive's employment hereunder for any
reason, including without limitation termination for Cause, Disability or
Retirement.

            (b) Executive shall have the right, upon prior Notice of
Termination, to terminate his employment hereunder for any reason.
Notwithstanding the foregoing, if the Executive terminates his employment for
any reason other than Good Reason, the Executive agrees that, for a period of
one year following the termination of the Executive's employment by the
Executive, he shall not (i) either as principal, agent, owner, shareholder or
investor of more than 3% of the stock, officer, director, partner, lender,
independent contractor, consultant or in any other capacity, engage in, have a
financial interest in or be in any way connected or affiliated with, or render
advice or services to, any person or entity that engages in any activity which
would compete in any way with the business operated First Defiance or First
Federal in the counties where they do business, or (ii) directly or indirectly,
solicit, divert, take away or interfere with, or attempt to solicit, divert,
take away or interfere with, the relationship of First Defiance or First Federal
or any of their subsidiaries with any person or entity who is or was a customer,
or employee or supplier of First Defiance of First Federal or any of their
subsidiaries immediately prior to the Date of Termination. Notwithstanding the
foregoing, nothing contained herein shall prevent the Executive, after the
termination of this Agreement by the Executive pursuant to this Section 5(b),
from engaging directly or indirectly in any banking or financial industry
business in a county or counties in which First Defiance or First Federal are
doing business if the only activity conducted in such county or counties is the
servicing of loans.

            The parties hereto acknowledge and agree that the duration and area
for which the covenant not to compete and other covenants set forth in this
Agreement are to be effective are fair and reasonable and are reasonably
required for the protection of First Federal. In the event that any court
determines that the time period or the area, or both of them, are unreasonable
as to any covenant and that such covenant is to that extent unenforceable, the
parties hereto agree that the covenant shall remain in full force and effect for
the greatest time period and in the greatest area that would not render it
unenforceable.

            (c) In the event that (i) the Executive's employment is terminated
by First Federal for Cause, Disability or Retirement or in the event of the
Executive's death, or (ii) Executive terminates his employment hereunder other
than for Good Reason, the Executive shall have no right pursuant to this
Agreement to compensation or other benefits for any period after the applicable
Date of Termination.

            (d) In the event that the Executive's employment is terminated by
First Federal for other than Cause, Disability, Retirement or the Executive's
death or such employment is terminated by the Executive (i) due to failure by
First Federal to comply with any material provision of this Agreement, which
failure has not been cured within


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twenty-five (25) days after a notice of non-compliance has been given by
Executive to First Federal, or (ii) for Good Reason, then First Federal shall,
subject to the provisions of Section 6 hereof, if applicable:

            (1) pay to the Executive, at the option of the Executive, in a lump
            sum payment or in thirty-six (36) equal monthly installments
            beginning with the first business day of the month following the
            Date of Termination, an amount equal to 2.99 times the Annual
            Compensation; and

            (2) maintain and provide for a period ending at the earlier of (i)
            the expiration of the remaining term of employment pursuant hereto
            prior to the Notice of Termination 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 (2)), 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 Date of Termination (other than
            retirement plans or stock compensation plans of First Federal),
            provided that in the event

            that the Executive's participation in any plan, program or
            arrangement as provided in this subparagraph (2) is barred, or
            during such period any such plan, program or arrangement is
            discontinued or the benefits thereunder are materially reduced,
            First Federal 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 Date of Termination.

      6. Limitation of Benefits under Certain Circumstances. If the payments and
benefits pursuant to Section 5 hereof, either alone or together with other
payments and benefits which Executive has the right to receive from the
Companies, would constitute a "parachute payment" under Section 280G of the
Code, the payments and benefits pursuant to Section 5 hereof shall be reduced,
in the manner determined by the Executive, by the amount, if any, which is the
minimum necessary to result in no portion of the payments and benefits under
Section 5 being non-deductible to either First Defiance or First Federal
pursuant to Section 280G of the Code and subject to the excise tax imposed under
Section 4999 of the Code. The determination of any reduction in the payments and
benefits to be made pursuant to Section 5 shall be based upon the opinion of
independent tax counsel selected by First Federal's independent public
accountants and paid by First Federal. Such counsel shall be reasonably
acceptable to First Federal and the Executive; shall promptly prepare the
foregoing opinion, but in no event later


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than thirty (30) days from the Date of Termination; and may use such actuaries
as such counsel deems necessary or advisable for the purpose. In the event that
First Federal and/or the Executive do not agree with the opinion of such
counsel, (i) First Federal shall pay to the Executive the maximum amount of
payments and benefits pursuant to Section 5, as selected by the Executive, which
such opinion indicates that there is a high probability do not result in any of
such payments and benefits being non-deductible to First Federal and subject to
the imposition of the excise tax imposed under Section 4999 of the Code and (ii)
First Federal may request, and the Executive shall have the right to demand that
First Federal request, a ruling from the IRS as to whether the disputed payments
and benefits pursuant to Section 5 hereof have such consequences. Any such
request for a ruling from the IRS shall be promptly prepared and filed by First
Federal, 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 the Executive's
approval prior to filing, which shall not be unreasonably withheld. First
Federal and the 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 in this Section 6,
or a reduction in the payments and benefits specified in Section 5 below zero.

      7. Mitigation; Non-Exclusivity of Benefits.

            (a) 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 Date of
Termination or otherwise.

            (b) The specific arrangements referred to herein are not intended to
exclude any other benefits which may be available to the Executive upon a
termination of employment with the Companies pursuant to employee benefit plans
of the Companies or otherwise.

      8. Withholding. All payments required to be made by First Federal
hereunder to the Executive shall be subject to the withholding of such amounts,
if any, relating to tax and other payroll deductions as First Federal may
reasonably determine should be withheld pursuant to any applicable law or
regulation.

      9. Assignability. First Federal may assign this Agreement and its rights
hereunder in whole, but not in part, to any corporation, bank or other entity
with or into which First Federal may hereafter merge or consolidate or to which
First Federal may transfer all or substantially all of their respective assets,
if in any such case said corporation, bank or other entity shall by operation of
law or expressly in writing assume all obligations of First Federal hereunder as
fully as if it had been originally made a party hereto, but may not otherwise
assign this Agreement or its rights hereunder. The Executive may not assign or
transfer this Agreement or any rights or obligations

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hereunder.

      10. 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 address set forth below, or to such other address as either party may
have specified in a prior notice given to the other party in the manner set
forth in this section:

          To First Federal:     First Federal Savings Bank of the Midwest
                                601 Clinton Street
                                Defiance, Ohio 43512

          To the Executive:     Gregory R. Allen
                                361 Blanchard Dr.
                                Defiance, Ohio 43512

      11. Amendment; Waiver. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and such officer or officers as may be
specifically designated by the Board of Directors of First Federal to sign on
its behalf. No waiver by any party hereto at any time of any breach by any 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.

      12. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the United States
where applicable and otherwise by the substantive laws of the State of Ohio.

      13. Nature of Obligations. Nothing contained herein shall create or
require First Federal to create a trust of any kind to fund any benefits which
may be payable hereunder, and to the extent that the Executive acquires a right
to receive benefits from First Federal hereunder, such right shall be no greater
than the right of any unsecured general creditor of First Federal.

      14. Headings. The section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

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


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      16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

      17. Regulatory Actions. The following provisions shall be applicable to
the parties to the extent that they are required to be included in employment
agreements between a savings association and its employees pursuant to Section
563.39(b) of the Regulations Applicable to All Savings Associations, 12
C.F.R.ss.563.39(b), or any successor thereto, and shall be controlling in the
event of a conflict with any other provision of this Agreement, including
without limitation Section 5 hereof.

            (a) If Executive is suspended from office and/or temporarily
prohibited from participating in the conduct of First Federal's affairs pursuant
to notice served under Section 8(e)(3) or Section 8(g)(1) of the Federal Deposit
Insurance Act ("FDIA")(12 U.S.C.ss.ss.1818 (e)(3) and 1818(g)(1)), First
Federal'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 Companies may, in their discretion: (i) pay Executive all or
part of the compensation withheld while its obligations under this Agreement
were suspended, and (ii) reinstate (in whole or in part) any of its obligations
which were suspended.

            (b) If Executive is removed from office and/or permanently
prohibited from participating in the conduct of First Federal's affairs by an
order issued under Section 8(e)(4) or Section 8(g)(1) of the FDIA (12
U.S.C.ss.ss.1818(e)(4) and (g)(1)), all obligations of First Federal under this
Agreement shall terminate as of the effective date of the order, but vested
rights of Executive and First Federal as of the date of termination shall not be
affected.

            (c) If First Federal is in default, as defined in Section 3(x)(1) of
the FDIA (12 U.S.C.ss.1813(x)(1)), all obligations under this Agreement shall
terminate as of the date of default, but vested rights of Executive and the
Companies as of the date of termination shall not be affected.

            (d) All obligations under this Agreement shall be terminated
pursuant to 12 C.F.R. ss. 563.39(b)(5) (except to the extent that it is
determined that continuation of the Agreement for the continued operation of
First Federal is necessary): (i) by the Director of the Office of Thrift
Supervision ("OTS"), or his/her designee, at the time the Federal Deposit
Insurance Corporation ("FDIC") or Resolution Trust Corporation enters into an
agreement to provide assistance to or on behalf of First Federal under the
authority contained in Section 13 (c) of the FDIA (12 U.S.C. ss.1823(c)); or
(ii) by the Director of the OTS, or his/her designee, at the time the Director
or his/her designee approves a supervisory merger to resolve problems related to
operation of First Federal or when First Federal is determined by the Director
of the OTS to be in an unsafe or unsound condition, but vested rights of
Executive and First Federal as of the date of termination shall not be affected.


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      18. Regulatory Prohibition. Notwithstanding any other provision of this
Agreement to the contrary, any payment made to the Executive pursuant to this
Agreement, or otherwise, are subject to and conditioned upon their compliance
with 12 U.S.C. Section 1828(K) and any regulations promulgated thereunder.

      19. Confidentiality. The Executive hereby agrees that he shall at all
times keep and maintain the confidentiality of all confidential information
regarding First Defiance and First Federal and any of their subsidiaries. The
Executive further agrees that he shall not, at anytime, either directly or
indirectly, use, either directly or indirectly, any Confidential Information
regarding First Defiance or First Federal and any of their subsidiaries for his
benefit or to the benefit of any other person or entity, or divulge, disclose,
reveal or otherwise communicate any confidential information regarding First
Defiance or First Federal and any of their subsidiaries to any person or entity
in any manner whatsoever, except to the extend otherwise required by law. The
obligations of this Paragraph 19 shall survive the termination of the
Executive's employment.

      IN WITNESS WHEREOF, this Agreement has been executed as of the date first
above written.


Attest:                                      FIRST FEDERAL SAVINGS AND LOAN

By: /s/ William J. Small                         By: /s/ Don C. Van Brackel
    -------------------------                    ------------------------------
        William J. Small                                 Don C. Van Brackel
                                                         Chairman of the Board

Witness:

/s/ William J. Small                               /s/ Gregory R. Allen
-----------------------------                    ------------------------------
   William J. Small                                    Gregory R. Allen


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