SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C.  20549

                              Form 8-K

                           CURRENT REPORT

                  Pursuant to Section 13 or 15(d) of
                  the Securities Exchange Act of 1934

                  Date of Report - June 21, 2005

                 UNION NATIONAL FINANCIAL CORPORATION
        (Exact name of registrant as specified in its charter)



    Pennsylvania                0-19214            23-2415179
---------------------------    -------------      -----------

State or other jurisdiction (Commission File     (IRS Employer
    of Incorporation)             Number)       Identification
                                                   Number)

   101 East Main Street, P.O. Box 567
         Mount Joy, Pennsylvania                        17552
---------------------------------------            --------------
(Address of principal executive offices)              (Zip Code)



 Registrant's telephone number including area code:
                       (717) 653-1441
                        --------------

                                N/A
-----------------------------------------------------------------
   (Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c))

<PAGE>

Item 1.01  Entry into a Material Definitive Agreement
           __________________________________________

           On June 21, 2005, Union National Financial Corporation
           and its subsidiary, Union National Community Bank,
           entered into an employment agreement with Michael A.
           Frey, Executive Vice President and Chief Operating
           Officer.  The agreement has a term of three years and
           provides for an annual base salary of $162,750. The
           agreement also contains certain provisions relative to
           rights Mr. Frey has in the event of a change in
           control of Union National or if employment is
           terminated without cause.  Also detailed in the
           employment agreement are the terms of a covenant of
           Mr. Frey not to compete with Union National.  The
           aforementioned employment agreement is attached as
           Exhibit 99.1 to this Current Report on Form 8-K.



Item 9.01  Financial Statements and Exhibits
           _________________________________

           (c)  Exhibits.

           Exhibit No.   Description
           ___________   ___________
           99.1          Employment agreement between Michael A.
                         Frey, Executive Vice President and Chief
                         Operating Officer and Union National
                         Financial Corporation and its
                         subsidiary, Union National Community
                         Bank.



<PAGE>

                          SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.

                             UNION NATIONAL FINANCIAL CORPORATION
                             (Registrant)


Dated: June 21, 2005         /s/Mark D. Gainer
                             ----------------------------------

                             Mark D. Gainer,
                             President & Chief Executive Officer
<PAGE>

                            EXHIBIT INDEX


Exhibit                                                   Page
_______                                                   ____

99.1      Employment agreement between Michael A.          5
          Frey, Executive Vice President and Chief
          Operating Officer and Union National
          Financial Corporation and its
          subsidiary, Union National Community
          Bank.


<PAGE>
                          EXHIBIT 99.1

  Employment agreement between Michael A.Frey, Executive
   Vice President and Chief Operating Officer and Union
    National  Financial Corporation and its subsidiary,
                Union National Community Bank.

<PAGE>
                      EMPLOYMENT AGREEMENT
                      ____________________

     THIS AGREEMENT is made as of the   21st  day of  June  ,
                                      _______        ______
2005, between UNION NATIONAL FINANCIAL CORPORATION
("Corporation"), a Pennsylvania business corporation having a
place of business at 101 E. Main Street, Mount Joy, Pennsylvania
17552-0567,  UNION NATIONAL COMMUNITY BANK ("Bank") a national
banking association having a place of business at 101 E. Main
Street, Mount Joy, Pennsylvania 17552-0567,  and MICHAEL A. FREY
("Executive"), an individual residing at 163 Canterbury Turn,
Lancaster, Pennsylvania 17601.

                           WITNESSETH:
                           __________

     WHEREAS, the Corporation is a registered bank holding
company;

     WHEREAS, the Bank is a subsidiary of the Corporation;

     WHEREAS, Corporation and Bank desire to employ Executive to
serve in the capacity of Executive Vice President and Chief
Operating Officer of the Bank under the terms and conditions set
forth herein;

     WHEREAS, Executive desires to accept employment with
Corporation and Bank on the terms and conditions set forth
herein.

                           AGREEMENT:
                           _________

     NOW, THEREFORE, the parties hereto, intending to be legally
bound, agree as follows:

1.   EMPLOYMENT.   Corporation and Bank hereby employ Executive,
     __________
     and Executive hereby accepts employment with Corporation and
     Bank, under the terms and conditions set forth in this
     Agreement.

2.   DUTIES OF EMPLOYEE.  Executive shall perform and discharge
     __________________
     well and faithfully such duties as an executive officer of
     Bank as may be assigned to Executive from time to time by
     the Board of Directors of Corporation and Bank.  Executive
     shall be employed as Executive Vice President and Chief
     Operating Officer of Bank and shall hold such other titles
     as may be given to him from time to time by the Board of
     Directors of Corporation and Bank.  Executive shall devote
     his full-time attention and energies to the business of
     Corporation and Bank during the Employment Period (as
     defined in Section 3 of this Agreement); provided, however,
     that this Section 2 shall not be construed as preventing
     Executive from (a) engaging in activities incident or
     necessary to personal investments so long as such investment
     does not exceed 5% of the outstanding shares of any publicly
     held company, (b) acting as a member of the Board of
     Directors of any other corporation or as a member of the
     Board of Trustees of any other organization, with the prior
     approval of the Board of Directors of Corporation and Bank,
     or (c) being involved in any

<PAGE>

     other activity with the prior approval of the Board of
     Directors of Corporation and Bank.  The Executive shall not
     engage in any business or commercial activities, duties or
     pursuits which compete with the business or commercial
     activities of Corporation or Bank, nor may the Executive
     serve as a director or officer or in any other capacity in a
     company which competes with Corporation or Bank.  Upon
     written approval from the Corporation, the Executive may
     engage in voluntary or philanthropic endeavors.

3.   TERM OF AGREEMENT.
     _________________

     (a)   This Agreement shall be for a three (3) year period
           (the "Employment Period") beginning on the date first
           written above, and if not previously terminated
           pursuant to the terms of this Agreement, the
           Employment Period shall end three (3) years later (the
           "Initial Term").  The Employment Period shall be
           extended automatically for one additional year on the
           third annual anniversary date of the commencement of
           the Initial Term (the date first above written), and
           then on each annual anniversary date of this Agreement
           thereafter, unless any of Corporation, Bank or
           Executive gives contrary written notice to the
           other(s) not less than 60 days before any such
           anniversary date so that upon the anniversary date if
           notice had not been previously given as provided in
           this Section 3(a), the Employment Period shall be and
           continue for a one-year period thereafter.  References
           in the Agreement to "Employment Period" shall refer to
           the Initial Term of this Agreement and any extensions
           to the initial term of this Agreement.

     (b)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically for Cause (as defined herein) upon
           written notice from the Board of Directors of each of
           Corporation and Bank to Executive.  As used in this
           Agreement, "Cause" shall mean any of the following:
           (i) the willful failure by the Executive to
           substantially perform his duties hereunder (other than
           a failure resulting from the Executive's incapacity
           because of physical or mental illness, as provided in
           Section 3(d) hereof), after notice from the
           Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (ii)
           the willful engaging by the Executive in misconduct
           injurious to the Corporation or Bank; (iii) the
           willful violation by the Executive of the provisions
           of Sections 3, 8, 9 or 10 hereof, after notice from
           the Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (iv)
           the dishonesty or gross negligence of the Executive in
           the performance of his duties; (v) the breach of
           Executive's fiduciary duty involving personal profit;
           (vi) the violation of any law, rule or regulation
           governing banks or bank officers or any final cease
           and desist order issued by a bank regulatory
           authority; (vii) conduct on the part of Executive
           which brings public discredit to the Corporation or
           Bank; (viii) unlawful discrimination by the Executive,
           including harassment against Corporation or Bank's
           employees, customers, business associates,
           contractors, or visitors; (ix) theft or abuse by
           Executive of the Corporation or Bank's property or the
           property of Corporation or Bank's customers,
           employees, contractors,

<PAGE>

           vendors, or business associates; (x) failure of the
           Executive to follow the good faith lawful instructions
           of the Board of Directors of Corporation or Bank with
           respect to its  operations, after notice from the
           Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (xi)
           the direction or recommendation of a state or federal
           bank regulatory authority to remove the Executive's
           position with Corporation and/or Bank as identified
           herein;  (xii) any final removal or prohibition order
           to which the Executive is subject, by a federal
           banking agency pursuant to Sections 8(e) and 8(g) of
           the Federal Deposit Insurance Act; (xiii) the
           Executive's conviction of or plea of guilty or nolo
           contendere to a felony, crime of falsehood or a crime
           involving moral turpitude, or the actual incarceration
           of Executive; (xiv) any act of fraud, misappropriation
           or personal dishonesty; (xv) insubordination; (xvi)
           misrepresentation of a material fact, or omission of
           information necessary to make the information supplied
           not materially misleading, in an application or other
           information provided by the Executive to the
           Corporation or any representative of the Corporation
           in connection with the Executive's employment with
           Corporation; (xvii) the existence of any material
           conflict between the interests of Corporation and the
           Executive that is not disclosed in writing by the
           Executive to the Corporation and approved in writing
           by the Board of Directors of Corporation; or (xviii)
           the Executive takes action that is clearly contrary to
           the best interest of the Corporation.

           If this Agreement is terminated for Cause, all of
           Executive's rights under this Agreement shall cease as
           of the effective date of such termination.

     (c)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically upon Executive's voluntary termination
           of employment (other than in accordance with Section 5
           of this Agreement) for Good Reason.  The term "Good
           Reason" shall mean (i) the assignment of duties and
           responsibilities inconsistent with Executive's status
           as Executive Vice President and Chief Operating
           Officer of Bank, (ii) a reassignment which requires
           Executive to move his principal residence or his
           office more than fifty (50) miles from the Bank's
           principal executive office immediately prior to this
           Agreement, (iii) any removal of the Executive from
           office or any adverse change in the terms and
           conditions of the Executive's employment, except for
           any termination of the Executive's employment under
           the provisions of Section 3(b) hereof, (iv) any
           reduction in the Executive's Annual Base Salary as in
           effect on the date hereof or as the same may be
           increased from time to time, except such reductions
           that are the result of a national financial depression
           or national or bank emergency when such reduction has
           been implemented by the Board of Directors for the
           Corporation and Bank's senior management, or (v) any
           failure of Corporation and Bank to provide the
           Executive with benefits at least as favorable as those
           enjoyed by the Executive during the Employment Period
           under any of the pension, life insurance, medical,
           health and accident, disability or other employee
           plans of Corporation and Bank, or the taking of any
           action that would materially reduce any of such
           benefits unless such reduction is part of a reduction
           applicable to all employees of comparable position
           within Bank.  If such termination occurs for

<PAGE>

           Good Reason, then Corporation or Bank shall pay
           Executive an amount equal to two (2) times the
           Executive's Annual Base Salary as defined in
           subsection (a) of Section 4, which amount shall be
           payable in twenty-four (24) equal monthly installments
           and shall be subject to federal, state and local tax
           withholdings.  In addition, if Executive and his
           dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the
           expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer) of the monthly COBRA continuation
           coverage premium for that month.  However, in the
           event the payment described herein, when added to all
           other amounts or benefits provided to or on behalf of
           the Executive in connection with his termination of
           employment, would result in the imposition of an
           excise tax under Code Section 4999, such payments
           shall be retroactively (if necessary) reduced to the
           extent necessary to avoid such excise tax imposition.
           Upon written notice to Executive, together with
           calculations of Corporation's independent auditors,
           Executive shall remit to Corporation the amount of the
           reduction, plus such interest, as may be necessary to
           avoid the imposition of such excise tax.
           Notwithstanding the foregoing or any other provision
           of this contract to the contrary, if any portion of
           the amount herein payable to the Executive is
           determined to be non-deductible pursuant to the
           regulations promulgated under Section 280G of the
           Internal Revenue Code of 1986, as amended (the
           "Code" ), the Corporation shall be required only to
           pay to Executive the amount determined to be
           deductible under Section 280G.

           At the option of the Executive, exercisable by the
           Executive within ninety (90) days after the occurrence
           of the event constituting "Good Reason," the Executive
           may resign from employment under this Agreement by a
           notice in writing (the "Notice of Termination")
           delivered to Corporation and Bank and the provisions
           of this Section 3(c) hereof shall thereupon apply.

     (d)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically upon Executive's Disability, and
           Executive's rights under this Agreement shall cease as
           of the date of such termination. For purposes of this
           Agreement, the Executive shall have a "Disability" if,
           as a result of

<PAGE>

           physical or mental injury or impairment, Executive is
           unable to perform all of the essential job functions
           of his position on a full time basis, taking into
           account any reasonable accommodation required by law,
           and without posing a direct threat to himself and
           others, for a period of one hundred eighty (180) days
           or more.

     (e)   Executive agrees that in the event his employment
           under this Agreement is terminated, Executive shall
           resign as a director of Corporation and Bank, or any
           affiliate or subsidiary thereof, if he is then serving
           as a director of any of such entities.

4.   EMPLOYMENT PERIOD COMPENSATION.
     ______________________________

     (a)   Annual Base Salary.  For services performed by
           __________________
           Executive under this Agreement, Corporation or Bank
           shall pay Executive an Annual Base Salary during the
           Employment Period at the rate of $162,750 per year,
           minus applicable withholdings and deductions,  payable
           at the same times as salaries are payable to other
           executive employees of Corporation or Bank.
           Corporation or Bank may, from time to time, increase
           Executive's Annual Base Salary, and any and all such
           increases shall be deemed to constitute amendments to
           this Section 4(a) to reflect the increased amounts,
           effective as of the date established for such
           increases by the Board of Directors of Corporation or
           Bank or any committee of such Board in the resolutions
           authorizing such increases.

     (b)   Bonus.  For services performed by Executive under this
           _____
           Agreement, Corporation or Bank may, from time to time,
           pay a bonus or bonuses to Executive as Corporation or
           Bank, in its sole discretion, deems appropriate.  The
           payment of any such bonuses shall not reduce or
           otherwise affect any other obligation of Corporation
           or Bank to Executive provided for in this Agreement.
           As of the time of the execution of this Agreement,
           Executive's incentive compensation is anticipated to
           be calculated as described in Exhibit 1 to this
           Agreement.

     (c)   Vacations.  During the term of this Agreement,
           _________
           Executive shall be entitled to paid annual vacation in
           accordance with the policies as established from time
           to time by the Boards of Directors of Corporation and
           Bank.  However, Executive shall not be entitled to
           receive any additional compensation from Corporation
           and Bank 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 Boards of Directors of Corporation
           and Bank.

     (d)   Automobile.   Executive shall be eligible for
           __________
           reimbursement for business related automobile mileage
           consistent with then applicable and current guidelines
           and rates permitted by Internal Revenue Service.

     (e)   Employee Benefit Plans.  During the term of this
           ______________________
           Agreement, Executive shall be entitled to participate
           in or receive the benefits of any employee benefit
           plan currently in effect at Corporation and Bank,
           subject to the terms of said plan, until such time
           that the Boards of Directors of Corporation and Bank
           authorize a

<PAGE>

           change in such benefits.  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 4(a) hereof.

     (f)   Business Expenses.  During the term of this Agreement,
           _________________
           Executive shall be entitled to receive prompt
           reimbursement for all reasonable expenses incurred by
           him, which are properly accounted for, in accordance
           with the policies and procedures established by the
           Boards of Directors of Corporation and Bank for their
           executive officers.

     (g)   Club Membership.  Corporation or Bank shall continue
           _______________
           pursuant to the letter of July 3, 2003 to make
           initiation payments to the Lancaster County Club under
           the terms and conditions set forth in that letter
           which is attached as Exhibit 2 to this Agreement.
           However, notwithstanding any provisions to the
           contrary in the letter of July 3, 2003, Corporation or
           Bank will pay membership dues and business-related
           expenses, incurred by Executive at the Lancaster
           Country Club.

5.   TERMINATION OF EMPLOYMENT FOLLOWING CHANGE IN CONTROL.
     _____________________________________________________

     (a)   If a Change in Control (as defined in Section 5(b) of
           this Agreement) shall occur and thereafter, there
           shall be:

           (i)   any involuntary termination of Executive's
                 employment (other than for the reasons set forth
                 in Section 3(b) or 3(d) of this Agreement);

           (ii)  any reduction in Executive's title,
                 responsibilities, including reporting
                 responsibilities, or authority, including such
                 title, responsibilities or authority as such may
                 be increased from time to time during the term
                 of this Agreement;

           (iii) the assignment to Executive of duties
                 inconsistent with Executive's office on the date
                 of the Change in Control or as the same may be
                 increased from time to time after the Change in
                 Control;

           (iv)  any reassignment of Executive to a location
                 greater than fifty (50) miles from the location
                 of Executive's office on the date of the Change
                 in Control;

           (v)   any reduction in Executive's Annual Base Salary
                 in effect on the date of the Change in Control
                 or as the same may be increased from time to
                 time after the Change in Control;

           (vi)  any failure to provide Executive with benefits
                 at least as favorable as those enjoyed by
                 Executive under any of Corporation or Bank's
                 retirement or pension, life insurance, medical,
                 health and accident, disability or other
                 employee plans in which Executive participated
                 at the time of the Change

<PAGE>

                 in Control, or the taking of any action that
                 would materially reduce any of such benefits in
                 effect at the time of the Change in Control;

           (vii) any requirement that Executive travel in
                 performance of his duties on behalf of
                 Corporation or Bank for a significantly greater
                 period of time during any year than was required
                 of Executive during the year preceding the year
                 in which the Change in Control occurred;

           (viii)any sustained pattern of interruption or
                 disruption of Executive for matters
                 substantially unrelated to Executive's discharge
                 of Executive's duties on behalf of Corporation
                 and Bank; or

           (ix)  a good faith determination by Executive that he
                 can no longer work with the new management of
                 Corporation and Bank, provided, however, that
                 Executive cannot make such a determination
                 during the first six (6) months following a
                 Change in Control.

           then, at the option of Executive, exercisable by
           Executive within one hundred eighty (180) days of the
           Change in Control or occurrence of any of the
           foregoing events, Executive may resign from employment
           with Corporation and Bank (or, if involuntarily
           terminated, give notice of intention to collect
           benefits under this Agreement) by delivering a notice
           in writing (the "Notice of Termination") to
           Corporation and Bank and the provisions of Section 6
           of this Agreement shall apply.

     (b)   As used in this Agreement, "Change in Control" shall
           mean a change in control (other than one occurring by
           reason of an acquisition of the Corporation or Bank by
           Executive) of a nature that would be required to be
           reported in response to Item 6(e) of Schedule 14A of
           Regulation 14A and any successor rule or regulation
           promulgated under the Securities Exchange Act of 1934
           (the "Exchange Act") if Corporation or Bank were
           subject to the Exchange Act reporting requirements;
           provided that, without limiting the foregoing, such a
           change in control shall be deemed to have occurred if
           the Board of Directors certifies that one of the
           following has occurred:

           (i)   (A) a merger, consolidation or division
                 involving Corporation or Bank, (B) a sale,
                 exchange, transfer or other disposition of
                 substantially all of the assets of Corporation
                 or Bank, or (C) a purchase by Corporation or
                 Bank of substantially all of the assets of
                 another entity, unless such merger,
                 consolidation, division, sale, exchange,
                 transfer, purchase or disposition is approved in
                 advance by seventy percent (70%) or more of the
                 members of the Board of Directors of Corporation
                 or Bank who are not interested in the
                 transaction and a majority of the members of the
                 Board of Directors of the legal entity resulting
                 from or existing after any such transaction and
                 of the Board of Directors of such entity's
                 parent corporation, if any, are former members
                 of the Board of Directors of Corporation or
                 Bank; or

<PAGE>

           (ii)  any "person" (as such term is used in Sections
                 13(d) and 14(d) of the Securities Exchange Act
                 of 1934 (the "Exchange Act")), other than
                 Corporation or Bank or any "person" who on the
                 date hereof is a director or officer of
                 Corporation or Bank is or becomes the
                 "beneficial owner" (as defined in Rule 13d-3
                 under the Exchange Act), directly or indirectly,
                 of securities of Corporation or Bank
                 representing fifty (50%) percent or more of the
                 total value or combined voting power of
                 Corporation or Bank's then outstanding
                 securities, or

           (iii) during any period of one (1) consecutive years
                 during the term of Executive's employment under
                 this Agreement, individuals who at the beginning
                 of such period constitute the Board of Directors
                 of Corporation or Bank cease for any reason to
                 constitute at least a majority thereof, unless
                 the election of each director who was not a
                 director at the beginning of such period has
                 been approved in advance by directors
                 representing at least two-thirds of the
                 directors then in office who were directors at
                 the beginning of the period.

6.   RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT FOLLOWING
     ______________________________________________________
     CHANGE IN CONTROL.
     _________________

     (a)   In the event that Executive delivers a Notice of
           Termination (as defined in Section 5(a) of this
           Agreement) to Corporation and Bank, Executive shall be
           entitled to receive the compensation and benefits set
           forth below:

           If, at the time of termination of Executive's
           employment, a "Change in Control" (as defined in
           Section 5(b) of this Agreement) has also occurred,
           Corporation and Bank shall pay Executive a lump sum
           amount equal to and no greater than two (2) times the
           Executive's Agreed Compensation as defined in
           subsection (a) of Section 4, minus applicable taxes
           and withholdings. In addition, if Executive and his
           dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the
           expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer)

<PAGE>

           of the monthly COBRA continuation coverage premium for
           that month.  However, in the event the payment
           described herein, when added to all other amounts or
           benefits provided to or on behalf of the Executive in
           connection with his termination of employment, would
           result in the imposition of an excise tax under Code
           Section 4999, such payments shall be retroactively (if
           necessary) reduced to the extent necessary to avoid
           such excise tax imposition.  Upon written notice to
           Executive, together with calculations of Corporation's
           independent auditors, Executive shall remit to
           Corporation the amount of the reduction, plus such
           interest, as may be necessary to avoid the imposition
           of such excise tax.  Notwithstanding the foregoing or
           any other provision of this contract to the contrary,
           if any portion of the amount herein payable to the
           Executive is determined to be non-deductible pursuant
           to the regulations promulgated under Section 280G of
           the Internal Revenue Code of 1986, as amended (the
           "Code"), the Corporation shall be required only to pay
           to Executive the amount determined to be deductible
           under Section 280G.

     (b)   Executive shall not be required to mitigate the amount
           of any payment provided for in this Section 6 by
           seeking other employment or otherwise.  Unless
           otherwise agreed to in writing, the amount of payment
           or the benefit provided for in this Section 6 shall
           not be reduced by any compensation earned by Executive
           as the result of employment by another employer or by
           reason of Executive's receipt of or right to receive
           any retirement or other benefits after the date of
           termination of employment or otherwise.

     (c)   Nothwithstanding any other provision, in the event
           that Executive is determined to be a key employee as
           that term is defined in Section 409A of the IRC no
           payment shall be made until one day following six
           months from the date of separation of service as that
           term is defined in Section 409A of the IRC.

7.   RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT ABSENT CHANGE
     __________________________________________________________
     IN CONTROL.
     __________

     (a)   In the event that Executive's employment is
           involuntarily terminated by Corporation and/or Bank
           without Cause and no Change in Control shall have
           occurred at the date of such termination, Corporation
           and Bank shall pay Executive an amount equal to two
           (2) times the Executive's Annual Base Salary as
           defined in subsection (a) of Section 4, which amount
           shall be payable in eighteen (18) equal monthly
           installments and shall be subject to federal, state
           and local tax withholdings.  In addition, if Executive
           and his dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the

<PAGE>

           expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer) of the monthly COBRA continuation
           coverage premium for that month.  However, in the
           event the payment described herein, when added to all
           other amounts or benefits provided to or on behalf of
           the Executive in connection with his termination of
           employment, would result in the imposition of an
           excise tax under Code Section 4999, such payments
           shall be retroactively (if necessary) reduced to the
           extent necessary to avoid such excise tax imposition.
           Upon written notice to Executive, together with
           calculations of Corporation's independent auditors,
           Executive shall remit to Corporation the amount of the
           reduction, plus such interest, as may be necessary to
           avoid the imposition of such excise tax.
           Notwithstanding the foregoing or any other provision
           of this contract to the contrary, if any portion of
           the amount herein payable to the Executive is
           determined to be non-deductible pursuant to the
           regulations promulgated under Section 280G of the
           Internal Revenue Code of 1986, as amended (the
           "Code"), the Corporation shall be required only to pay
           to Executive the amount determined to be deductible
           under Section 280G.

     (b)   Executive shall not be required to mitigate the amount
           of any payment provided for in this Section 7 by
           seeking other employment or otherwise.  Unless
           otherwise agreed to in writing, the amount of payment
           or the benefit provided for in this Section 7 shall
           not be reduced by any compensation earned by Executive
           as the result of employment by another employer or by
           reason of Executive's receipt of or right to receive
           any retirement or other benefits after the date of
           termination of employment or otherwise.

8.   COVENANT NOT TO COMPETE.
     _______________________

     (a)   Executive hereby acknowledges and recognizes the
           highly competitive nature of the business of
           Corporation and Bank and accordingly agrees that,
           during and for the applicable period set forth in
           Section 8(c) hereof, Executive shall not, except as
           otherwise permitted in writing by the Corporation and
           the Bank:

           (i)   be engaged, directly or indirectly, either for
                 his own account or as agent, consultant,
                 employee, partner, officer, director,
                 proprietor, investor (except as an investor
                 owning less than 5% of the stock of a publicly
                 owned company) or otherwise of any person, firm,
                 corporation or enterprise engaged in (1) the
                 banking (including bank holding company) or
                 financial services industry, or (2) any other
                 activity in which Corporation or Bank or any of
                 their subsidiaries are engaged during the
                 Employment Period, and remain so engaged at the
                 end of the Employment

<PAGE>

                 Period, in any county and contiguous county in
                 which, at the date of termination of the
                 Executive's employment, a branch location,
                 office, loan production office, or trust or
                 asset and wealth management office of
                 Corporation, Bank or any of their subsidiaries
                 is located, whether inside or outside of the
                 Commonwealth of Pennsylvania, (the "Non-
                 Competition Area"); or

           (ii)  provide financial or other assistance to any
                 person, firm, corporation, or enterprise engaged
                 in (1) the banking (including bank holding
                 company) or financial services industry, or (2)
                 any other activity in which Corporation or Bank
                 or any of their subsidiaries are engaged during
                 the Employment Period, in the Non-Competition
                 Area; or

           (iii) directly or indirectly solicit persons or
                 entities who were customers or referral sources
                 of Corporation, Bank or their subsidiaries
                 within one year of Executive's termination of
                 employment, to a become customer or referral
                 source of a person or entity other than
                 Corporation, Bank or their subsidiaries;

           (iv)  directly or indirectly solicit employees of
                 Corporation, Bank or their subsidiaries who were
                 employed within one year of Executive's
                 termination of employment to work for anyone
                 other than Corporation, Bank or their
                 subsidiaries.

     (b)   It is expressly understood and agreed that, although
           Executive and Corporation and Bank consider the
           restrictions contained in Section 8(a) hereof
           reasonable for the purpose of preserving for
           Corporation and Bank and their subsidiaries their good
           will and other proprietary rights, if a final judicial
           determination is made by a court having jurisdiction
           that the time or territory or any other restriction
           contained in Section 8(a) hereof is an unreasonable or
           otherwise unenforceable restriction against Executive,
           the provisions of Section 8(a) hereof shall not be
           rendered void but shall be deemed amended to apply as
           to such maximum time and territory and to such other
           extent as such court may judicially determine or
           indicate to be reasonable.

     (c)   The provisions of this Section 8 shall be applicable
           commencing on the date of this Agreement and ending on
           one of the following dates, as applicable:

           (i)   if Executive's employment terminates in
                 accordance with the non-renewal provisions of
                 Section 3, the first anniversary date of the
                 effective date of termination of employment; or

           (ii)  if Executive's employment terminates in
                 accordance with the provisions of Section 3(c)
                 of this Agreement (relating to termination for
                 Good Reason),  eighteen (18) months following
                 the effective date of termination of employment;
                 or

<PAGE>

           (iii) if the Executive voluntarily terminates his
                 employment without Good Reason, eighteen (18)
                 months following the effective date of
                 termination of employment; or

           (iv)  if the Executive's employment is involuntarily
                 terminated without Cause or under Section 5(a)
                 of this Agreement (relating to termination for
                 Change of Control), eighteen (18) months
                 following the effective date of termination of
                 employment.

           (v)   if the Executive's employment is terminated for
                 Cause as defined in Sections 3(b)(i)-(v),
                 Section 3(b)(ix), Section 3(b)(x),  or Section
                 3(b)(xiv)-(xviii) of this Agreement, the second
                 anniversary date of the effective date of
                 termination of employment.

           (vi)  if the Executive's employment is terminated for
                 Cause as defined in Sections 3(b)(vi)-(viii) or
                 Sections 3(b)(xi)-(xiii) of this Agreement, the
                 first anniversary date of the effective date of
                 termination of employment.


9.   UNAUTHORIZED DISCLOSURE.  During the term of his employment
     _______________________
     hereunder, or at any later time, the Executive shall not,
     without the written consent of the Boards of Directors of
     Corporation and Bank or a person authorized thereby,
     knowingly disclose to any person, other than an employee of
     Corporation or Bank or a person to whom disclosure is
     reasonably necessary or appropriate in connection with the
     performance by the Executive of his duties as an executive
     of Corporation and Bank, any material confidential
     information obtained by him while in the employ of
     Corporation and Bank with respect to any of Corporation and
     Bank's services, products, improvements, formulas, designs
     or styles, processes, customers, methods of business or any
     business practices, the disclosure of which could be or will
     be damaging to Corporation or Bank; provided, however, that
     confidential information shall not include any information
     known generally to the public (other than as a result of
     unauthorized disclosure by the Executive or any person with
     the assistance, consent or direction of the Executive) or
     any information of a type not otherwise considered
     confidential by persons engaged in the same business of a
     business similar to that conducted by Corporation and Bank
     or any information that must be disclosed as required by
     law.

10.  WORK MADE FOR HIRE.  Any work performed by the Executive
     __________________
     under this Agreement should be considered a "Work Made for
     Hire" as the phrase is defined by the U.S. patent
     laws and shall be owned by and for the express benefit of
     Corporation, Bank and their subsidiaries and affiliates.  In
     the event it should be established that such work does not
     qualify as a Work Made for Hire, the Executive agrees to and
     does hereby assign to Corporation, Bank, and their
     affiliates and subsidiaries, all of his rights, title,
     and/or interest in such work product, including, but not
     limited to, all copyrights, patents, trademarks, and
     propriety rights.

11.  RETURN OF COMPANY PROPERTY AND DOCUMENTS.  The Executive
     ________________________________________
     agrees that, at the time of termination of his employment,
     regardless of the reason for termination, he will deliver

<PAGE>

     to Corporation, Bank and their subsidiaries and affiliates,
     any and all company property, including, but not limited to,
     automobile, keys, security codes or passes, mobile
     telephones, records, data, notes, reports, proposals, lists,
     correspondence, specifications, drawings, blueprints,
     sketches, software programs, equipment, other documents or
     property, or reproductions of any of the aforementioned
     items developed or obtained by the Executive during the
     course of his employment.

12.  LIABILITY INSURANCE.  Corporation and Bank shall use their
     ___________________
     best efforts to obtain insurance coverage for the Executive
     under an insurance policy covering officers and directors of
     Corporation and Bank against lawsuits, arbitrations or other
     legal or regulatory proceedings; however, nothing herein
     shall be construed to require Corporation and/or Bank to
     obtain such insurance, if the Board of Directors of the
     Corporation and/or Bank determine that such coverage cannot
     be obtained at a reasonable price.

13.  NOTICES.  Except as otherwise provided in this Agreement,
     _______
     any notice required or permitted to be given under this
     Agreement shall be deemed properly given if in writing and
     if mailed by registered or certified mail, postage prepaid
     with return receipt requested, to Executive's residence, in
     the case of notices to Executive, and to the principal
     executive offices of Corporation and Bank, in the case of
     notices to Corporation and Bank.

14.  WAIVER.  No provision of this Agreement may be modified,
     ______
     waived or discharged unless such waiver, modification or
     discharge is agreed to in writing and signed by Executive
     and an executive officer specifically designated by the
     Boards of Directors of Corporation and Bank.  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.

15.  ASSIGNMENT.  This Agreement shall not be assignable by any
     __________
     party, except by Corporation and Bank to any successor in
     interest to their respective businesses.

16.  ENTIRE AGREEMENT.  This Agreement supersedes any and all
     ________________
     agreements, either oral or in writing, between the parties
     with respect to the employment of the Executive by the Bank
     and/or Corporation and this Agreement contains all the
     covenants and agreements between the parties with respect to
     employment.

17.  BINDING AGREEMENT.
     _________________

     This Agreement shall inure to the benefit of and be
     enforceable by Executive's personal or legal
     representatives, executors, administrators, heirs,
     distributees, devisees and legatees.  If Executive should
     die after a Notice of Termination is delivered by Executive,
     or following termination of Executive's employment without
     Cause, and any amounts would be payable to Executive under
     this Agreement if Executive had continued to live, all such
     amounts shall be paid in accordance with the terms of this
     Agreement to

<PAGE>

     Executive's devisee, legatee, or other designee, or, if
     there is no such designee, to Executive's estate.

18.  ARBITRATION.   Corporation, Bank and Executive recognize
     ___________
     that in the event a dispute should arise between them
     concerning the interpretation or implementation of this
     Agreement, lengthy and expensive litigation will not afford
     a practical resolution of the issues within a reasonable
     period of time.  Consequently, each party agrees that all
     disputes, disagreements and questions of interpretation
     concerning this Agreement (except for any enforcement sought
     with respect to Sections 8, 9, 10 or 11 which may be
     litigated in court, including an action for injunction or
     other relief) are to be submitted for resolution, in
     Philadelphia, Pennsylvania, to the American Arbitration
     Association (the "Association") in accordance with the
     Association's National Rules for the Resolution of
     Employment Disputes or other applicable rules then in effect
     ("Rules").  Corporation, Bank or Executive may initiate an
     arbitration proceeding at any time by giving notice to the
     other in accordance with the Rules.  Corporation and Bank
     and Executive may, as a matter of right, mutually agree on
     the appointment of a particular arbitrator from the
     Association's pool.  The arbitrator shall not be bound by
     the rules of evidence and procedure of the courts of the
     Commonwealth of Pennsylvania but shall be bound by the
     substantive law applicable to this Agreement.  The decision
     of the arbitrator, absent fraud, duress, incompetence or
     gross and obvious error of fact, shall be final and binding
     upon the parties and shall be enforceable in courts of
     proper jurisdiction.  Following written notice of a request
     for arbitration, Corporation, Bank and Executive shall be
     entitled to an injunction restraining all further
     proceedings in any pending or subsequently filed litigation
     concerning this Agreement, except as otherwise provided
     herein or any enforcement sought with respect to Sections 8,
     9, 10 or 11 of this Agreement, including an action for
     injunction or other relief.

19.  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.

20.  APPLICABLE LAW.  This Agreement shall be governed by and
     ______________
     construed in accordance with the domestic, internal laws of
     the Commonwealth of Pennsylvania, without regard to its
     conflicts of laws principles provided that this Agreement
     shall also be interpreted as is minimally required to
     qualify any payment hereunder as not triggering any penalty
     on the Executive or the Corporation or Bank pursuant to
     Section 409A of the IRC.

21.  HEADINGS.  The section headings of this Agreement are for
     ________
     convenience only and shall not control or affect the meaning
     or construction or limit the scope or intent of any of the
     provisions of this Agreement.

<PAGE>

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

ATTEST:                         UNION NATIONAL FINANCIAL
                                CORPORATION


/s/ Marcene L. Camara        By /s/ Donald H. Wolgemuth
________________________        ___________________________
       Asst , Secretary         Donald H. Wolgemuth,
                                Chairman of the Board

                                UNION NATIONAL COMMUNITY
                                BANK

/s/ Marcene L. Camara        By /s/ Donald H. Wolgemuth
________________________        ___________________________
            , Secretary         Donald H. Wolgemuth,
                                Chairman of the Board

WITNESS:                        EXECUTIVE

/s/ Mark D. Gainer              /s/ Michael A. Frey
________________________        ___________________________
                                Michael A. Frey
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SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C.  20549

                              Form 8-K

                           CURRENT REPORT

                  Pursuant to Section 13 or 15(d) of
                  the Securities Exchange Act of 1934

                  Date of Report - June 21, 2005

                 UNION NATIONAL FINANCIAL CORPORATION
        (Exact name of registrant as specified in its charter)

    Pennsylvania                0-19214            23-2415179
---------------------------    -------------      -----------

State or other jurisdiction (Commission File     (IRS Employer
    of Incorporation)             Number)       Identification
                                                   Number)

   101 East Main Street, P.O. Box 567
         Mount Joy, Pennsylvania                        17552
---------------------------------------            --------------
(Address of principal executive offices)              (Zip Code)

 Registrant's telephone number including area code:
                       (717) 653-1441
                        --------------

                                N/A
-----------------------------------------------------------------
   (Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01  Entry into a Material Definitive Agreement
           __________________________________________

           On June 21, 2005, Union National Financial Corporation
           and its subsidiary, Union National Community Bank,
           entered into an employment agreement with Michael A.
           Frey, Executive Vice President and Chief Operating
           Officer.  The agreement has a term of three years and
           provides for an annual base salary of $162,750. The
           agreement also contains certain provisions relative to
           rights Mr. Frey has in the event of a change in
           control of Union National or if employment is
           terminated without cause.  Also detailed in the
           employment agreement are the terms of a covenant of
           Mr. Frey not to compete with Union National.  The
           aforementioned employment agreement is attached as
           Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01  Financial Statements and Exhibits
           _________________________________

           (c)  Exhibits.

           Exhibit No.   Description
           ___________   ___________
           99.1          Employment agreement between Michael A.
                         Frey, Executive Vice President and Chief
                         Operating Officer and Union National
                         Financial Corporation and its
                         subsidiary, Union National Community
                         Bank.
SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.

                             UNION NATIONAL FINANCIAL CORPORATION
                             (Registrant)

Dated: June 21, 2005         /s/Mark D. Gainer
                             ----------------------------------

                             Mark D. Gainer,
                             President & Chief Executive Officer
EXHIBIT INDEX

Exhibit                                                   Page
_______                                                   ____

99.1      Employment agreement between Michael A.          5
          Frey, Executive Vice President and Chief
          Operating Officer and Union National
          Financial Corporation and its
          subsidiary, Union National Community
          Bank.
EXHIBIT 99.1

  Employment agreement between Michael A.Frey, Executive
   Vice President and Chief Operating Officer and Union
    National  Financial Corporation and its subsidiary,
                Union National Community Bank.
EMPLOYMENT AGREEMENT
                      ____________________

     THIS AGREEMENT is made as of the   21st  day of  June  ,
                                      _______        ______
2005, between UNION NATIONAL FINANCIAL CORPORATION
("Corporation"), a Pennsylvania business corporation having a
place of business at 101 E. Main Street, Mount Joy, Pennsylvania
17552-0567,  UNION NATIONAL COMMUNITY BANK ("Bank") a national
banking association having a place of business at 101 E. Main
Street, Mount Joy, Pennsylvania 17552-0567,  and MICHAEL A. FREY
("Executive"), an individual residing at 163 Canterbury Turn,
Lancaster, Pennsylvania 17601.

                           WITNESSETH:
                           __________

     WHEREAS, the Corporation is a registered bank holding
company;

     WHEREAS, the Bank is a subsidiary of the Corporation;

     WHEREAS, Corporation and Bank desire to employ Executive to
serve in the capacity of Executive Vice President and Chief
Operating Officer of the Bank under the terms and conditions set
forth herein;

     WHEREAS, Executive desires to accept employment with
Corporation and Bank on the terms and conditions set forth
herein.

                           AGREEMENT:
                           _________

     NOW, THEREFORE, the parties hereto, intending to be legally
bound, agree as follows:

1.   EMPLOYMENT.   Corporation and Bank hereby employ Executive,
     __________
     and Executive hereby accepts employment with Corporation and
     Bank, under the terms and conditions set forth in this
     Agreement.

2.   DUTIES OF EMPLOYEE.  Executive shall perform and discharge
     __________________
     well and faithfully such duties as an executive officer of
     Bank as may be assigned to Executive from time to time by
     the Board of Directors of Corporation and Bank.  Executive
     shall be employed as Executive Vice President and Chief
     Operating Officer of Bank and shall hold such other titles
     as may be given to him from time to time by the Board of
     Directors of Corporation and Bank.  Executive shall devote
     his full-time attention and energies to the business of
     Corporation and Bank during the Employment Period (as
     defined in Section 3 of this Agreement); provided, however,
     that this Section 2 shall not be construed as preventing
     Executive from (a) engaging in activities incident or
     necessary to personal investments so long as such investment
     does not exceed 5% of the outstanding shares of any publicly
     held company, (b) acting as a member of the Board of
     Directors of any other corporation or as a member of the
     Board of Trustees of any other organization, with the prior
     approval of the Board of Directors of Corporation and Bank,
     or (c) being involved in any
other activity with the prior approval of the Board of
     Directors of Corporation and Bank.  The Executive shall not
     engage in any business or commercial activities, duties or
     pursuits which compete with the business or commercial
     activities of Corporation or Bank, nor may the Executive
     serve as a director or officer or in any other capacity in a
     company which competes with Corporation or Bank.  Upon
     written approval from the Corporation, the Executive may
     engage in voluntary or philanthropic endeavors.

3.   TERM OF AGREEMENT.
     _________________

     (a)   This Agreement shall be for a three (3) year period
           (the "Employment Period") beginning on the date first
           written above, and if not previously terminated
           pursuant to the terms of this Agreement, the
           Employment Period shall end three (3) years later (the
           "Initial Term").  The Employment Period shall be
           extended automatically for one additional year on the
           third annual anniversary date of the commencement of
           the Initial Term (the date first above written), and
           then on each annual anniversary date of this Agreement
           thereafter, unless any of Corporation, Bank or
           Executive gives contrary written notice to the
           other(s) not less than 60 days before any such
           anniversary date so that upon the anniversary date if
           notice had not been previously given as provided in
           this Section 3(a), the Employment Period shall be and
           continue for a one-year period thereafter.  References
           in the Agreement to "Employment Period" shall refer to
           the Initial Term of this Agreement and any extensions
           to the initial term of this Agreement.

     (b)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically for Cause (as defined herein) upon
           written notice from the Board of Directors of each of
           Corporation and Bank to Executive.  As used in this
           Agreement, "Cause" shall mean any of the following:
           (i) the willful failure by the Executive to
           substantially perform his duties hereunder (other than
           a failure resulting from the Executive's incapacity
           because of physical or mental illness, as provided in
           Section 3(d) hereof), after notice from the
           Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (ii)
           the willful engaging by the Executive in misconduct
           injurious to the Corporation or Bank; (iii) the
           willful violation by the Executive of the provisions
           of Sections 3, 8, 9 or 10 hereof, after notice from
           the Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (iv)
           the dishonesty or gross negligence of the Executive in
           the performance of his duties; (v) the breach of
           Executive's fiduciary duty involving personal profit;
           (vi) the violation of any law, rule or regulation
           governing banks or bank officers or any final cease
           and desist order issued by a bank regulatory
           authority; (vii) conduct on the part of Executive
           which brings public discredit to the Corporation or
           Bank; (viii) unlawful discrimination by the Executive,
           including harassment against Corporation or Bank's
           employees, customers, business associates,
           contractors, or visitors; (ix) theft or abuse by
           Executive of the Corporation or Bank's property or the
           property of Corporation or Bank's customers,
           employees, contractors,
vendors, or business associates; (x) failure of the
           Executive to follow the good faith lawful instructions
           of the Board of Directors of Corporation or Bank with
           respect to its  operations, after notice from the
           Corporation or Bank and a failure to cure such
           violation within thirty (30) days of said notice; (xi)
           the direction or recommendation of a state or federal
           bank regulatory authority to remove the Executive's
           position with Corporation and/or Bank as identified
           herein;  (xii) any final removal or prohibition order
           to which the Executive is subject, by a federal
           banking agency pursuant to Sections 8(e) and 8(g) of
           the Federal Deposit Insurance Act; (xiii) the
           Executive's conviction of or plea of guilty or nolo
           contendere to a felony, crime of falsehood or a crime
           involving moral turpitude, or the actual incarceration
           of Executive; (xiv) any act of fraud, misappropriation
           or personal dishonesty; (xv) insubordination; (xvi)
           misrepresentation of a material fact, or omission of
           information necessary to make the information supplied
           not materially misleading, in an application or other
           information provided by the Executive to the
           Corporation or any representative of the Corporation
           in connection with the Executive's employment with
           Corporation; (xvii) the existence of any material
           conflict between the interests of Corporation and the
           Executive that is not disclosed in writing by the
           Executive to the Corporation and approved in writing
           by the Board of Directors of Corporation; or (xviii)
           the Executive takes action that is clearly contrary to
           the best interest of the Corporation.

           If this Agreement is terminated for Cause, all of
           Executive's rights under this Agreement shall cease as
           of the effective date of such termination.

     (c)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically upon Executive's voluntary termination
           of employment (other than in accordance with Section 5
           of this Agreement) for Good Reason.  The term "Good
           Reason" shall mean (i) the assignment of duties and
           responsibilities inconsistent with Executive's status
           as Executive Vice President and Chief Operating
           Officer of Bank, (ii) a reassignment which requires
           Executive to move his principal residence or his
           office more than fifty (50) miles from the Bank's
           principal executive office immediately prior to this
           Agreement, (iii) any removal of the Executive from
           office or any adverse change in the terms and
           conditions of the Executive's employment, except for
           any termination of the Executive's employment under
           the provisions of Section 3(b) hereof, (iv) any
           reduction in the Executive's Annual Base Salary as in
           effect on the date hereof or as the same may be
           increased from time to time, except such reductions
           that are the result of a national financial depression
           or national or bank emergency when such reduction has
           been implemented by the Board of Directors for the
           Corporation and Bank's senior management, or (v) any
           failure of Corporation and Bank to provide the
           Executive with benefits at least as favorable as those
           enjoyed by the Executive during the Employment Period
           under any of the pension, life insurance, medical,
           health and accident, disability or other employee
           plans of Corporation and Bank, or the taking of any
           action that would materially reduce any of such
           benefits unless such reduction is part of a reduction
           applicable to all employees of comparable position
           within Bank.  If such termination occurs for
Good Reason, then Corporation or Bank shall pay
           Executive an amount equal to two (2) times the
           Executive's Annual Base Salary as defined in
           subsection (a) of Section 4, which amount shall be
           payable in twenty-four (24) equal monthly installments
           and shall be subject to federal, state and local tax
           withholdings.  In addition, if Executive and his
           dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the
           expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer) of the monthly COBRA continuation
           coverage premium for that month.  However, in the
           event the payment described herein, when added to all
           other amounts or benefits provided to or on behalf of
           the Executive in connection with his termination of
           employment, would result in the imposition of an
           excise tax under Code Section 4999, such payments
           shall be retroactively (if necessary) reduced to the
           extent necessary to avoid such excise tax imposition.
           Upon written notice to Executive, together with
           calculations of Corporation's independent auditors,
           Executive shall remit to Corporation the amount of the
           reduction, plus such interest, as may be necessary to
           avoid the imposition of such excise tax.
           Notwithstanding the foregoing or any other provision
           of this contract to the contrary, if any portion of
           the amount herein payable to the Executive is
           determined to be non-deductible pursuant to the
           regulations promulgated under Section 280G of the
           Internal Revenue Code of 1986, as amended (the
           "Code" ), the Corporation shall be required only to
           pay to Executive the amount determined to be
           deductible under Section 280G.

           At the option of the Executive, exercisable by the
           Executive within ninety (90) days after the occurrence
           of the event constituting "Good Reason," the Executive
           may resign from employment under this Agreement by a
           notice in writing (the "Notice of Termination")
           delivered to Corporation and Bank and the provisions
           of this Section 3(c) hereof shall thereupon apply.

     (d)   Notwithstanding the provisions of Section 3(a) of this
           Agreement, this Agreement shall terminate
           automatically upon Executive's Disability, and
           Executive's rights under this Agreement shall cease as
           of the date of such termination. For purposes of this
           Agreement, the Executive shall have a "Disability" if,
           as a result of
physical or mental injury or impairment, Executive is
           unable to perform all of the essential job functions
           of his position on a full time basis, taking into
           account any reasonable accommodation required by law,
           and without posing a direct threat to himself and
           others, for a period of one hundred eighty (180) days
           or more.

     (e)   Executive agrees that in the event his employment
           under this Agreement is terminated, Executive shall
           resign as a director of Corporation and Bank, or any
           affiliate or subsidiary thereof, if he is then serving
           as a director of any of such entities.

4.   EMPLOYMENT PERIOD COMPENSATION.
     ______________________________

     (a)   Annual Base Salary.  For services performed by
           __________________
           Executive under this Agreement, Corporation or Bank
           shall pay Executive an Annual Base Salary during the
           Employment Period at the rate of $162,750 per year,
           minus applicable withholdings and deductions,  payable
           at the same times as salaries are payable to other
           executive employees of Corporation or Bank.
           Corporation or Bank may, from time to time, increase
           Executive's Annual Base Salary, and any and all such
           increases shall be deemed to constitute amendments to
           this Section 4(a) to reflect the increased amounts,
           effective as of the date established for such
           increases by the Board of Directors of Corporation or
           Bank or any committee of such Board in the resolutions
           authorizing such increases.

     (b)   Bonus.  For services performed by Executive under this
           _____
           Agreement, Corporation or Bank may, from time to time,
           pay a bonus or bonuses to Executive as Corporation or
           Bank, in its sole discretion, deems appropriate.  The
           payment of any such bonuses shall not reduce or
           otherwise affect any other obligation of Corporation
           or Bank to Executive provided for in this Agreement.
           As of the time of the execution of this Agreement,
           Executive's incentive compensation is anticipated to
           be calculated as described in Exhibit 1 to this
           Agreement.

     (c)   Vacations.  During the term of this Agreement,
           _________
           Executive shall be entitled to paid annual vacation in
           accordance with the policies as established from time
           to time by the Boards of Directors of Corporation and
           Bank.  However, Executive shall not be entitled to
           receive any additional compensation from Corporation
           and Bank 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 Boards of Directors of Corporation
           and Bank.

     (d)   Automobile.   Executive shall be eligible for
           __________
           reimbursement for business related automobile mileage
           consistent with then applicable and current guidelines
           and rates permitted by Internal Revenue Service.

     (e)   Employee Benefit Plans.  During the term of this
           ______________________
           Agreement, Executive shall be entitled to participate
           in or receive the benefits of any employee benefit
           plan currently in effect at Corporation and Bank,
           subject to the terms of said plan, until such time
           that the Boards of Directors of Corporation and Bank
           authorize a
change in such benefits.  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 4(a) hereof.

     (f)   Business Expenses.  During the term of this Agreement,
           _________________
           Executive shall be entitled to receive prompt
           reimbursement for all reasonable expenses incurred by
           him, which are properly accounted for, in accordance
           with the policies and procedures established by the
           Boards of Directors of Corporation and Bank for their
           executive officers.

     (g)   Club Membership.  Corporation or Bank shall continue
           _______________
           pursuant to the letter of July 3, 2003 to make
           initiation payments to the Lancaster County Club under
           the terms and conditions set forth in that letter
           which is attached as Exhibit 2 to this Agreement.
           However, notwithstanding any provisions to the
           contrary in the letter of July 3, 2003, Corporation or
           Bank will pay membership dues and business-related
           expenses, incurred by Executive at the Lancaster
           Country Club.

5.   TERMINATION OF EMPLOYMENT FOLLOWING CHANGE IN CONTROL.
     _____________________________________________________

     (a)   If a Change in Control (as defined in Section 5(b) of
           this Agreement) shall occur and thereafter, there
           shall be:

           (i)   any involuntary termination of Executive's
                 employment (other than for the reasons set forth
                 in Section 3(b) or 3(d) of this Agreement);

           (ii)  any reduction in Executive's title,
                 responsibilities, including reporting
                 responsibilities, or authority, including such
                 title, responsibilities or authority as such may
                 be increased from time to time during the term
                 of this Agreement;

           (iii) the assignment to Executive of duties
                 inconsistent with Executive's office on the date
                 of the Change in Control or as the same may be
                 increased from time to time after the Change in
                 Control;

           (iv)  any reassignment of Executive to a location
                 greater than fifty (50) miles from the location
                 of Executive's office on the date of the Change
                 in Control;

           (v)   any reduction in Executive's Annual Base Salary
                 in effect on the date of the Change in Control
                 or as the same may be increased from time to
                 time after the Change in Control;

           (vi)  any failure to provide Executive with benefits
                 at least as favorable as those enjoyed by
                 Executive under any of Corporation or Bank's
                 retirement or pension, life insurance, medical,
                 health and accident, disability or other
                 employee plans in which Executive participated
                 at the time of the Change
in Control, or the taking of any action that
                 would materially reduce any of such benefits in
                 effect at the time of the Change in Control;

           (vii) any requirement that Executive travel in
                 performance of his duties on behalf of
                 Corporation or Bank for a significantly greater
                 period of time during any year than was required
                 of Executive during the year preceding the year
                 in which the Change in Control occurred;

           (viii)any sustained pattern of interruption or
                 disruption of Executive for matters
                 substantially unrelated to Executive's discharge
                 of Executive's duties on behalf of Corporation
                 and Bank; or

           (ix)  a good faith determination by Executive that he
                 can no longer work with the new management of
                 Corporation and Bank, provided, however, that
                 Executive cannot make such a determination
                 during the first six (6) months following a
                 Change in Control.

           then, at the option of Executive, exercisable by
           Executive within one hundred eighty (180) days of the
           Change in Control or occurrence of any of the
           foregoing events, Executive may resign from employment
           with Corporation and Bank (or, if involuntarily
           terminated, give notice of intention to collect
           benefits under this Agreement) by delivering a notice
           in writing (the "Notice of Termination") to
           Corporation and Bank and the provisions of Section 6
           of this Agreement shall apply.

     (b)   As used in this Agreement, "Change in Control" shall
           mean a change in control (other than one occurring by
           reason of an acquisition of the Corporation or Bank by
           Executive) of a nature that would be required to be
           reported in response to Item 6(e) of Schedule 14A of
           Regulation 14A and any successor rule or regulation
           promulgated under the Securities Exchange Act of 1934
           (the "Exchange Act") if Corporation or Bank were
           subject to the Exchange Act reporting requirements;
           provided that, without limiting the foregoing, such a
           change in control shall be deemed to have occurred if
           the Board of Directors certifies that one of the
           following has occurred:

           (i)   (A) a merger, consolidation or division
                 involving Corporation or Bank, (B) a sale,
                 exchange, transfer or other disposition of
                 substantially all of the assets of Corporation
                 or Bank, or (C) a purchase by Corporation or
                 Bank of substantially all of the assets of
                 another entity, unless such merger,
                 consolidation, division, sale, exchange,
                 transfer, purchase or disposition is approved in
                 advance by seventy percent (70%) or more of the
                 members of the Board of Directors of Corporation
                 or Bank who are not interested in the
                 transaction and a majority of the members of the
                 Board of Directors of the legal entity resulting
                 from or existing after any such transaction and
                 of the Board of Directors of such entity's
                 parent corporation, if any, are former members
                 of the Board of Directors of Corporation or
                 Bank; or
(ii)  any "person" (as such term is used in Sections
                 13(d) and 14(d) of the Securities Exchange Act
                 of 1934 (the "Exchange Act")), other than
                 Corporation or Bank or any "person" who on the
                 date hereof is a director or officer of
                 Corporation or Bank is or becomes the
                 "beneficial owner" (as defined in Rule 13d-3
                 under the Exchange Act), directly or indirectly,
                 of securities of Corporation or Bank
                 representing fifty (50%) percent or more of the
                 total value or combined voting power of
                 Corporation or Bank's then outstanding
                 securities, or

           (iii) during any period of one (1) consecutive years
                 during the term of Executive's employment under
                 this Agreement, individuals who at the beginning
                 of such period constitute the Board of Directors
                 of Corporation or Bank cease for any reason to
                 constitute at least a majority thereof, unless
                 the election of each director who was not a
                 director at the beginning of such period has
                 been approved in advance by directors
                 representing at least two-thirds of the
                 directors then in office who were directors at
                 the beginning of the period.

6.   RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT FOLLOWING
     ______________________________________________________
     CHANGE IN CONTROL.
     _________________

     (a)   In the event that Executive delivers a Notice of
           Termination (as defined in Section 5(a) of this
           Agreement) to Corporation and Bank, Executive shall be
           entitled to receive the compensation and benefits set
           forth below:

           If, at the time of termination of Executive's
           employment, a "Change in Control" (as defined in
           Section 5(b) of this Agreement) has also occurred,
           Corporation and Bank shall pay Executive a lump sum
           amount equal to and no greater than two (2) times the
           Executive's Agreed Compensation as defined in
           subsection (a) of Section 4, minus applicable taxes
           and withholdings. In addition, if Executive and his
           dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the
           expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer)
of the monthly COBRA continuation coverage premium for
           that month.  However, in the event the payment
           described herein, when added to all other amounts or
           benefits provided to or on behalf of the Executive in
           connection with his termination of employment, would
           result in the imposition of an excise tax under Code
           Section 4999, such payments shall be retroactively (if
           necessary) reduced to the extent necessary to avoid
           such excise tax imposition.  Upon written notice to
           Executive, together with calculations of Corporation's
           independent auditors, Executive shall remit to
           Corporation the amount of the reduction, plus such
           interest, as may be necessary to avoid the imposition
           of such excise tax.  Notwithstanding the foregoing or
           any other provision of this contract to the contrary,
           if any portion of the amount herein payable to the
           Executive is determined to be non-deductible pursuant
           to the regulations promulgated under Section 280G of
           the Internal Revenue Code of 1986, as amended (the
           "Code"), the Corporation shall be required only to pay
           to Executive the amount determined to be deductible
           under Section 280G.

     (b)   Executive shall not be required to mitigate the amount
           of any payment provided for in this Section 6 by
           seeking other employment or otherwise.  Unless
           otherwise agreed to in writing, the amount of payment
           or the benefit provided for in this Section 6 shall
           not be reduced by any compensation earned by Executive
           as the result of employment by another employer or by
           reason of Executive's receipt of or right to receive
           any retirement or other benefits after the date of
           termination of employment or otherwise.

     (c)   Nothwithstanding any other provision, in the event
           that Executive is determined to be a key employee as
           that term is defined in Section 409A of the IRC no
           payment shall be made until one day following six
           months from the date of separation of service as that
           term is defined in Section 409A of the IRC.

7.   RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT ABSENT CHANGE
     __________________________________________________________
     IN CONTROL.
     __________

     (a)   In the event that Executive's employment is
           involuntarily terminated by Corporation and/or Bank
           without Cause and no Change in Control shall have
           occurred at the date of such termination, Corporation
           and Bank shall pay Executive an amount equal to two
           (2) times the Executive's Annual Base Salary as
           defined in subsection (a) of Section 4, which amount
           shall be payable in eighteen (18) equal monthly
           installments and shall be subject to federal, state
           and local tax withholdings.  In addition, if Executive
           and his dependents who are qualified beneficiaries are
           eligible to elect continuation of health insurance
           benefits under the Consolidated Omnibus Budget
           Reconciliation Act of 1995 ("COBRA") and if Executive
           elects to purchase such COBRA continuation coverage
           for himself and/or for his qualified beneficiaries,
           then in such event the Employer shall reimburse
           Executive in an amount equal to the monthly premium
           paid by him to obtain such coverage, net of the amount
           which employees of the Employer are required to
           contribute toward the purchase of health insurance
           benefits under the personnel policies of the Employer
           then in effect, which reimbursement shall continue
           until the first of the following to occur:  (i) the
expiration of 18 months following the date of
           termination of the Employment Period, and (ii) the
           qualification of Executive and his qualified
           beneficiaries for substantially equivalent coverage
           under any health insurance policy maintained by any
           future employer of Executive.  Reimbursement as
           provided for herein shall be made by the Employer to
           Executive monthly within five (5) business days
           following the presentation by Executive to the
           Employer of evidence of payment by him (in the form of
           a copy of a cancelled check or credit card draft or
           other documentary evidence reasonably satisfactory to
           the Employer) of the monthly COBRA continuation
           coverage premium for that month.  However, in the
           event the payment described herein, when added to all
           other amounts or benefits provided to or on behalf of
           the Executive in connection with his termination of
           employment, would result in the imposition of an
           excise tax under Code Section 4999, such payments
           shall be retroactively (if necessary) reduced to the
           extent necessary to avoid such excise tax imposition.
           Upon written notice to Executive, together with
           calculations of Corporation's independent auditors,
           Executive shall remit to Corporation the amount of the
           reduction, plus such interest, as may be necessary to
           avoid the imposition of such excise tax.
           Notwithstanding the foregoing or any other provision
           of this contract to the contrary, if any portion of
           the amount herein payable to the Executive is
           determined to be non-deductible pursuant to the
           regulations promulgated under Section 280G of the
           Internal Revenue Code of 1986, as amended (the
           "Code"), the Corporation shall be required only to pay
           to Executive the amount determined to be deductible
           under Section 280G.

     (b)   Executive shall not be required to mitigate the amount
           of any payment provided for in this Section 7 by
           seeking other employment or otherwise.  Unless
           otherwise agreed to in writing, the amount of payment
           or the benefit provided for in this Section 7 shall
           not be reduced by any compensation earned by Executive
           as the result of employment by another employer or by
           reason of Executive's receipt of or right to receive
           any retirement or other benefits after the date of
           termination of employment or otherwise.

8.   COVENANT NOT TO COMPETE.
     _______________________

     (a)   Executive hereby acknowledges and recognizes the
           highly competitive nature of the business of
           Corporation and Bank and accordingly agrees that,
           during and for the applicable period set forth in
           Section 8(c) hereof, Executive shall not, except as
           otherwise permitted in writing by the Corporation and
           the Bank:

           (i)   be engaged, directly or indirectly, either for
                 his own account or as agent, consultant,
                 employee, partner, officer, director,
                 proprietor, investor (except as an investor
                 owning less than 5% of the stock of a publicly
                 owned company) or otherwise of any person, firm,
                 corporation or enterprise engaged in (1) the
                 banking (including bank holding company) or
                 financial services industry, or (2) any other
                 activity in which Corporation or Bank or any of
                 their subsidiaries are engaged during the
                 Employment Period, and remain so engaged at the
                 end of the Employment
Period, in any county and contiguous county in
                 which, at the date of termination of the
                 Executive's employment, a branch location,
                 office, loan production office, or trust or
                 asset and wealth management office of
                 Corporation, Bank or any of their subsidiaries
                 is located, whether inside or outside of the
                 Commonwealth of Pennsylvania, (the "Non-
                 Competition Area"); or

           (ii)  provide financial or other assistance to any
                 person, firm, corporation, or enterprise engaged
                 in (1) the banking (including bank holding
                 company) or financial services industry, or (2)
                 any other activity in which Corporation or Bank
                 or any of their subsidiaries are engaged during
                 the Employment Period, in the Non-Competition
                 Area; or

           (iii) directly or indirectly solicit persons or
                 entities who were customers or referral sources
                 of Corporation, Bank or their subsidiaries
                 within one year of Executive's termination of
                 employment, to a become customer or referral
                 source of a person or entity other than
                 Corporation, Bank or their subsidiaries;

           (iv)  directly or indirectly solicit employees of
                 Corporation, Bank or their subsidiaries who were
                 employed within one year of Executive's
                 termination of employment to work for anyone
                 other than Corporation, Bank or their
                 subsidiaries.

     (b)   It is expressly understood and agreed that, although
           Executive and Corporation and Bank consider the
           restrictions contained in Section 8(a) hereof
           reasonable for the purpose of preserving for
           Corporation and Bank and their subsidiaries their good
           will and other proprietary rights, if a final judicial
           determination is made by a court having jurisdiction
           that the time or territory or any other restriction
           contained in Section 8(a) hereof is an unreasonable or
           otherwise unenforceable restriction against Executive,
           the provisions of Section 8(a) hereof shall not be
           rendered void but shall be deemed amended to apply as
           to such maximum time and territory and to such other
           extent as such court may judicially determine or
           indicate to be reasonable.

     (c)   The provisions of this Section 8 shall be applicable
           commencing on the date of this Agreement and ending on
           one of the following dates, as applicable:

           (i)   if Executive's employment terminates in
                 accordance with the non-renewal provisions of
                 Section 3, the first anniversary date of the
                 effective date of termination of employment; or

           (ii)  if Executive's employment terminates in
                 accordance with the provisions of Section 3(c)
                 of this Agreement (relating to termination for
                 Good Reason),  eighteen (18) months following
                 the effective date of termination of employment;
                 or
(iii) if the Executive voluntarily terminates his
                 employment without Good Reason, eighteen (18)
                 months following the effective date of
                 termination of employment; or

           (iv)  if the Executive's employment is involuntarily
                 terminated without Cause or under Section 5(a)
                 of this Agreement (relating to termination for
                 Change of Control), eighteen (18) months
                 following the effective date of termination of
                 employment.

           (v)   if the Executive's employment is terminated for
                 Cause as defined in Sections 3(b)(i)-(v),
                 Section 3(b)(ix), Section 3(b)(x),  or Section
                 3(b)(xiv)-(xviii) of this Agreement, the second
                 anniversary date of the effective date of
                 termination of employment.

           (vi)  if the Executive's employment is terminated for
                 Cause as defined in Sections 3(b)(vi)-(viii) or
                 Sections 3(b)(xi)-(xiii) of this Agreement, the
                 first anniversary date of the effective date of
                 termination of employment.

9.   UNAUTHORIZED DISCLOSURE.  During the term of his employment
     _______________________
     hereunder, or at any later time, the Executive shall not,
     without the written consent of the Boards of Directors of
     Corporation and Bank or a person authorized thereby,
     knowingly disclose to any person, other than an employee of
     Corporation or Bank or a person to whom disclosure is
     reasonably necessary or appropriate in connection with the
     performance by the Executive of his duties as an executive
     of Corporation and Bank, any material confidential
     information obtained by him while in the employ of
     Corporation and Bank with respect to any of Corporation and
     Bank's services, products, improvements, formulas, designs
     or styles, processes, customers, methods of business or any
     business practices, the disclosure of which could be or will
     be damaging to Corporation or Bank; provided, however, that
     confidential information shall not include any information
     known generally to the public (other than as a result of
     unauthorized disclosure by the Executive or any person with
     the assistance, consent or direction of the Executive) or
     any information of a type not otherwise considered
     confidential by persons engaged in the same business of a
     business similar to that conducted by Corporation and Bank
     or any information that must be disclosed as required by
     law.

10.  WORK MADE FOR HIRE.  Any work performed by the Executive
     __________________
     under this Agreement should be considered a "Work Made for
     Hire" as the phrase is defined by the U.S. patent
     laws and shall be owned by and for the express benefit of
     Corporation, Bank and their subsidiaries and affiliates.  In
     the event it should be established that such work does not
     qualify as a Work Made for Hire, the Executive agrees to and
     does hereby assign to Corporation, Bank, and their
     affiliates and subsidiaries, all of his rights, title,
     and/or interest in such work product, including, but not
     limited to, all copyrights, patents, trademarks, and
     propriety rights.

11.  RETURN OF COMPANY PROPERTY AND DOCUMENTS.  The Executive
     ________________________________________
     agrees that, at the time of termination of his employment,
     regardless of the reason for termination, he will deliver
to Corporation, Bank and their subsidiaries and affiliates,
     any and all company property, including, but not limited to,
     automobile, keys, security codes or passes, mobile
     telephones, records, data, notes, reports, proposals, lists,
     correspondence, specifications, drawings, blueprints,
     sketches, software programs, equipment, other documents or
     property, or reproductions of any of the aforementioned
     items developed or obtained by the Executive during the
     course of his employment.

12.  LIABILITY INSURANCE.  Corporation and Bank shall use their
     ___________________
     best efforts to obtain insurance coverage for the Executive
     under an insurance policy covering officers and directors of
     Corporation and Bank against lawsuits, arbitrations or other
     legal or regulatory proceedings; however, nothing herein
     shall be construed to require Corporation and/or Bank to
     obtain such insurance, if the Board of Directors of the
     Corporation and/or Bank determine that such coverage cannot
     be obtained at a reasonable price.

13.  NOTICES.  Except as otherwise provided in this Agreement,
     _______
     any notice required or permitted to be given under this
     Agreement shall be deemed properly given if in writing and
     if mailed by registered or certified mail, postage prepaid
     with return receipt requested, to Executive's residence, in
     the case of notices to Executive, and to the principal
     executive offices of Corporation and Bank, in the case of
     notices to Corporation and Bank.

14.  WAIVER.  No provision of this Agreement may be modified,
     ______
     waived or discharged unless such waiver, modification or
     discharge is agreed to in writing and signed by Executive
     and an executive officer specifically designated by the
     Boards of Directors of Corporation and Bank.  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.

15.  ASSIGNMENT.  This Agreement shall not be assignable by any
     __________
     party, except by Corporation and Bank to any successor in
     interest to their respective businesses.

16.  ENTIRE AGREEMENT.  This Agreement supersedes any and all
     ________________
     agreements, either oral or in writing, between the parties
     with respect to the employment of the Executive by the Bank
     and/or Corporation and this Agreement contains all the
     covenants and agreements between the parties with respect to
     employment.

17.  BINDING AGREEMENT.
     _________________

     This Agreement shall inure to the benefit of and be
     enforceable by Executive's personal or legal
     representatives, executors, administrators, heirs,
     distributees, devisees and legatees.  If Executive should
     die after a Notice of Termination is delivered by Executive,
     or following termination of Executive's employment without
     Cause, and any amounts would be payable to Executive under
     this Agreement if Executive had continued to live, all such
     amounts shall be paid in accordance with the terms of this
     Agreement to
Executive's devisee, legatee, or other designee, or, if
     there is no such designee, to Executive's estate.

18.  ARBITRATION.   Corporation, Bank and Executive recognize
     ___________
     that in the event a dispute should arise between them
     concerning the interpretation or implementation of this
     Agreement, lengthy and expensive litigation will not afford
     a practical resolution of the issues within a reasonable
     period of time.  Consequently, each party agrees that all
     disputes, disagreements and questions of interpretation
     concerning this Agreement (except for any enforcement sought
     with respect to Sections 8, 9, 10 or 11 which may be
     litigated in court, including an action for injunction or
     other relief) are to be submitted for resolution, in
     Philadelphia, Pennsylvania, to the American Arbitration
     Association (the "Association") in accordance with the
     Association's National Rules for the Resolution of
     Employment Disputes or other applicable rules then in effect
     ("Rules").  Corporation, Bank or Executive may initiate an
     arbitration proceeding at any time by giving notice to the
     other in accordance with the Rules.  Corporation and Bank
     and Executive may, as a matter of right, mutually agree on
     the appointment of a particular arbitrator from the
     Association's pool.  The arbitrator shall not be bound by
     the rules of evidence and procedure of the courts of the
     Commonwealth of Pennsylvania but shall be bound by the
     substantive law applicable to this Agreement.  The decision
     of the arbitrator, absent fraud, duress, incompetence or
     gross and obvious error of fact, shall be final and binding
     upon the parties and shall be enforceable in courts of
     proper jurisdiction.  Following written notice of a request
     for arbitration, Corporation, Bank and Executive shall be
     entitled to an injunction restraining all further
     proceedings in any pending or subsequently filed litigation
     concerning this Agreement, except as otherwise provided
     herein or any enforcement sought with respect to Sections 8,
     9, 10 or 11 of this Agreement, including an action for
     injunction or other relief.

19.  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.

20.  APPLICABLE LAW.  This Agreement shall be governed by and
     ______________
     construed in accordance with the domestic, internal laws of
     the Commonwealth of Pennsylvania, without regard to its
     conflicts of laws principles provided that this Agreement
     shall also be interpreted as is minimally required to
     qualify any payment hereunder as not triggering any penalty
     on the Executive or the Corporation or Bank pursuant to
     Section 409A of the IRC.

21.  HEADINGS.  The section headings of this Agreement are for
     ________
     convenience only and shall not control or affect the meaning
     or construction or limit the scope or intent of any of the
     provisions of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.

ATTEST:                         UNION NATIONAL FINANCIAL
                                CORPORATION

/s/ Marcene L. Camara        By /s/ Donald H. Wolgemuth
________________________        ___________________________
       Asst , Secretary         Donald H. Wolgemuth,
                                Chairman of the Board

                                UNION NATIONAL COMMUNITY
                                BANK

/s/ Marcene L. Camara        By /s/ Donald H. Wolgemuth
________________________        ___________________________
            , Secretary         Donald H. Wolgemuth,
                                Chairman of the Board

WITNESS:                        EXECUTIVE

/s/ Mark D. Gainer              /s/ Michael A. Frey
________________________        ___________________________
                                Michael A. Frey