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                                 EXHIBIT 10 (E)
                        PENNROCK FINANCIAL SERVICES CORP.

                     EMPLOYMENT AGREEMENT FOR MELVIN PANKUCH

         THIS AGREEMENT, made this 17th day of December 1999 by and between
PennRock Financial Services Corp., a Pennsylvania business corporation with
corporate offices at 1060 Main Street, P.O. Box 580, Blue Ball, PA 17506, (the
"Company"), and Blue Ball National Bank, a national banking corporation with
offices at 1060 Main Street, P.O. Box 580, Blue Ball, PA 17506 (the "Bank"), and
Melvin Pankuch, an adult individual who resides at 58 Heister Avenue, New
Holland, PA 17557 ("Executive"),

         WITNESSETH, that in consideration of the mutual covenants as
hereinafter set forth, and intending to be legally bound hereby, the parties
hereto agree as follows:

         1. Background. The Company is engaged in the business of operating a
bank holding company. Bank is a wholly-owned subsidiary of Company. Executive
has extensive experience in the banking field and has, for a number of years,
served as an executive officer of Company and of Bank. The parties now desire to
formalize their contractual relationship.

         2. Employment and Duties.

            (a) Employment. The Company hereby engages Executive to serve as
Executive Vice President and Chief Executive Officer of Company. Bank hereby
engages Executive to serve as President and Chief Executive Officer of Bank.
Executive hereby accepts such engagements, on the terms and subject to the
conditions hereinafter set forth for the period specified in Section 5 below
(the "Employment Period"). As of the date hereof, Executive serves as a member
of the Boards of Directors of Company and Bank, and it is the intention of the
parties that Boards of Directors of, respectively, Company and Bank shall, from
time to time, propose Executive for reelection to such positions as long as
Executive continues to serve as Executive Vice President and Chief Executive
Officer of Company and President and Chief Executive Officer of Bank.

            (b) Duties. During the Employment Period, Executive shall be
responsible for performing the functions of the offices for which he is engaged
and shall perform all duties and accept all responsibilities incidental to such
positions or as may be assigned by the Boards of Directors of, respectively, the
Company (the "Company Board") and the Bank (the "Bank Board") (the Company Board
and the Bank Board being referred to herein generically as, collectively, the
"Boards" and as, individually, a "Board"), and as prescribed from time to time
by the Board in a job description for Executive's position, and Executive shall
cooperate fully with the Boards.

            (c) Full Time and Best Efforts. Executive agrees during the
Employment Period to devote his full time and best efforts to the businesses of
the Company and the Bank, as directed by the Boards, and further agrees that he
will not, directly or indirectly, engage in consulting or in any other trade or
business for his own account or for or on behalf of any other person, firm,
corporation or other business, professional or commercial entity.

         3. Compensation and Benefits.

            (a) Salary. Except as otherwise herein provided, all salary or other
compensation payable to Executive shall be payable by Bank. The Bank shall pay
to Executive a base salary (the "Base Salary") of not less than $265,000.00 per
year, payable in proportionate installments in accordance with the payroll
policies of the Bank from time to time in effect. The Executive shall receive no
additional compensation beyond his Base Salary for his services as a Director of
Company and/or of Bank. The Base Salary shall be subject to annual review during
the Employment Period in accordance with the personnel policies of the Bank as
from time to time in effect and shall in this connection be subject to such
adjustments as may in the judgment of the Bank be appropriate in view of

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Executive's performance, the financial condition and results of operations of
the Bank, and such other factors as the Bank Board or the Company Board
determines to be relevant. Bank shall review Executive's Base Salary no less
often than annually, annual reviews to be completed on or before March 31 of
each year and any Base Salary increase to be retroactive to the first pay period
of the year. Notwithstanding the foregoing, at no time during the Employment
Term shall Executive have the right to receive or continue to receive a Base
Salary in excess of the initial Base Salary for which provision is made herein,
except as provided in section 13 hereof.

            (b) Vacation, Insurance, and Employee Benefits. Executive shall
during the Employment Period be entitled to: (i) not less than 22 business days
paid vacation each year, (ii) sick leave in accordance with the personnel
policies of the Bank as from time to time in effect, and (iii) benefits under
such profit sharing, group life insurance, accident and health insurance plans,
and other employee benefit plans as may from time to time be adopted by the Bank
for the benefit of its employees generally, as and to the extent determined by
the Bank and in accordance with the terms of any such plan.

            (c) Reimbursement of Expenses. Bank shall reimburse Executive for
all ordinary and necessary out-of-pocket business expenses incurred by Executive
in connection with the discharge of Executive's duties and responsibilities
hereunder during the Employment Period in accordance with Bank's expense
approval and reporting procedures then in effect and upon presentation to Bank
of an itemized account and written proof of such expenses, as provided in such
procedures.

            (d) Club Memberships. During the Employment Period, Bank shall
provide Executive with one or more memberships in such social, athletic, or
similar clubs or organizations, at Bank's expense, as the Bank Board deems
appropriate from time to time. Upon Termination of the Employment Period for any
reason, Executive shall have the right to continue such membership or
memberships at Executive's expense, provided that Executive shall reimburse Bank
in full for any initiation or equity payment made by Bank in consideration of
such membership or memberships, excluding annual membership dues or assessments.

            (e) Disability. In the event that Executive becomes subject to the
provisions of Bank's short-term or long-term disability policy, Executive's
compensation shall be governed by the terms thereof during the term of the
short-term or long-term disability.

         4. Additional Compensation.

            (a) Additional Compensation. In addition to the Base Salary to be
paid to Executive during the Employment Period, the Bank shall determine
Executive's eligibility for incentive compensation under Bank's Bonus
Compensation Plan and PennRock Financial Services Corp. Executive Incentive
Compensation Plan (the "Additional Compensation") in respect of each calendar
year during the Employment Period under a formula approved by the Bank Board, as
may be amended from time to time, and shall pay any such Additional
Compensation, as so determined, to Executive. Benefits payable under the Bank's
Bonus Compensation Plan shall be payable at times and under terms specified by
the Board and by the plan. The PennRock Financial Services Corp. Executive
Incentive Compensation Plan benefits as calculated for any year shall be payable
not sooner than January 1 and not later than May 31 of the following year. The
Additional Compensation may be paid in whole or in part in cash or in stock of
Company.

            (b) Effect of Termination of Employment Period.

                (1) General Rule. Executive acknowledges and agrees that the
timing of the payment of the Additional Compensation is intended in part to
create an inducement for Executive to remain in the employ of the Bank.
Therefore, except as otherwise specifically provided in Section 4(b)(2),
Executive shall not be entitled to receive any Additional Compensation in
respect of a given calendar year unless he is employed by the Bank as of the
Additional Compensation Payment Date for the Additional Compensation, if any,
payable in respect of such calendar year.


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                (2) Exceptions to General Rule. In the event that the Employment
Period terminates by reason of: (i) the exercise by the Bank of its right not to
renew pursuant to Section 5 below, (ii) Executive's disability or death, (iii)
the exercise by the Bank of its right to terminate the Employment Period without
cause pursuant to Section 8 below, or (iv) the exercise by Executive of his
right to terminate the Employment Period for Good Reason pursuant to Section 11
below, then in such event Executive shall be entitled to receive his Additional
Compensation, as follows:



                    (A) Prior Calendar Year Additional Compensation. If any
Additional Compensation is payable in respect of the calendar year preceding the
calendar year in which the termination of the Employment Period occurs but such
Additional Compensation remains unpaid as of the date of such termination, then
such Additional Compensation shall be paid in full upon the Additional
Compensation Payment Date.

                    (B) Current Calendar Year Additional Compensation. No
Additional Compensation shall be payable in such event in respect of the
calendar year in which the termination of the Employment Period occurs.

            (c) Authority and Discretion of the Bank. Executive acknowledges
that management decisions relating to the operation of the business of the Bank,
including, without limitation, decisions relating to the incurring of expenses
(including the method of allocating to the Bank overhead expenses incurred by
Bank and/or Company) and the timing of income, will affect Adjusted Net Income
in a given calendar year and agrees that this Section 4 shall not be construed
to limit in any respect whatsoever the reasonable discretion of the Bank to make
such decisions and that all such decisions shall be made by the Bank in its sole
and absolute discretion.

         5. Employment Period.

            (a) Initial Period. The Employment Period shall begin on the date of
this Agreement and shall terminate upon the first to occur of the following:

                (1) Expiration of Two Years. The close of business on December
31, 2002, unless the Employment Period is extended pursuant to Section 5(b)
below;

                (2) Disability. Bank may elect to replace the Executive on a
permanent basis in the event that the Executive experiences a long-term
disability or recurring short-term disabilities, as defined by Bank's policies
and procedures from time to time. If, after Executive has received disability
benefits for a period consisting of 180 consecutive days, Executive remains
unable, in the opinion of Bank's Board of Directors and PennRock's Board of
Directors, to perform the essential functions of his positions on a full-time
basis, with or without a reasonable accommodation and without posing a threat to
himself or others, it is agreed that PennRock and Bank will suffer an undue
hardship by continuing the Executive's employment in his then-current position;

                (3) Death. Executive's death;

                (4) Termination by the Bank for Cause. Termination of the
Employment Period by the Bank for cause pursuant to Section 8 below;

                (5) Termination by the Bank Without Cause. Termination of the
Employment Period by the Bank without cause pursuant to Section 9 below;

                (6) Resignation. Termination of the Employment Period by reason
of Executive's resignation pursuant to Section 10 below; and


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                (7) Termination by Executive for Good Reason. Termination of the
Employment Period by Executive for good reason pursuant to Section 11 below.

            (b) Renewal Periods. This Agreement shall renew automatically and
the Employment Period shall be extended for successive additional periods of two
years each, unless Executive or the Bank, at least One Hundred Eighty (180) days
before the expiration of the Employment Period pursuant to Section 5(a)(1) above
or the expiration of any extension of the Employment Period pursuant to this
Section 5(b), gives written notice to the other of intention not to renew this
Agreement.

            (c) Effects of Termination.

                (1) Executive's right to receive any further compensation or
            benefits under this Agreement shall expire and terminate absolutely
            upon termination of the Employment Period, except that: (A) the Bank
            shall pay the unpaid portion, if any, of the Base Salary earned by
            Executive through the effective date of termination, (B) the Bank
            shall pay the severance benefit, if any, to which Executive may be
            entitled under Section 12 below, and (C) the Bank shall provide to
            Executive such post-employment benefits, if any, as are provided for
            under the employee benefit plans of the Bank in accordance with the
            terms of any such plan.

                (2) Upon termination of Executive's employment for any reason,
            such termination shall constitute termination of Executive as a
            Director of Company and of Bank, without notice, and management
            shall be under no further obligation to propose Executive for
            election or reelection as a Director of either Company or of Bank.

         6. Termination by Reason of Nonrenewal. Either party shall have the
right to terminate the Employment Period pursuant to Section 5(b) above by
electing not to renew this Agreement, which election may be made with or without
cause for any reason whatsoever.

         7. Termination by Reason of Disability or Death.

            (a) Death. The Employment Period shall terminate upon the death of
Executive.

            (b) Disability. The Employment Period shall terminate at the
election of the Board in the event that the Executive experiences a long-term
disability or recurring short-term disabilities, as defined by Bank's policies
and procedures from time to time, if the Executive has received disability
benefits for a period consisting of 180 consecutive days and, at such time,
Executive remains unable, in the opinion of Bank's Board of Directors and
PennRock's Board of Directors, to perform the essential functions of his
positions on a full-time basis, with or without a reasonable accommodation and
without posing a threat to himself or others. It is agreed that, in such event,
PennRock and Bank will suffer an undue hardship by continuing the Executive's
employment in his then-current position.

         8. Termination by the Bank for Cause.

            (a) Termination. The Bank shall have the right at any time upon
written notice to Executive to terminate the Employment Period for Cause.

            (b) Cause. For purposes of this Agreement, the term "Cause" shall
mean: (i) serious and willful misconduct by Executive in the course of or
connected with his employment hereunder, including the failure to comply in any
material respect with the Bank's written policies and procedures, (ii) failure
by Executive to perform at a reasonably acceptable level, as reasonably
determined by the Bank's Board of Directors, the duties of his position in
accordance with the terms and conditions of this Agreement or the reasonable
directions of the Bank,


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(iii) a material breach on the part of Executive of any provision of this
Agreement, (iv) conduct on the part of Executive involving dishonesty or moral
turpitude or conduct which the Bank's Board of directors reasonably determines
may tend to bring discredit to or to injure the reputation or business of the
Bank, (v) the conviction of or plea of guilty or nolo contendere by Executive to
a felony, or (vi) Executive's intentional violation of any federal or state
securities or banking law or regulation.

         9. Termination by the Bank Without Cause. The Bank shall have the right
at any time during the Employment Period upon 30 days written notice to
Executive to terminate the Employment Period without cause. The Bank may in its
discretion following delivery of its notice of termination elect immediately to
relieve Executive of all or any part of his duties under this Agreement and to
exclude Executive thereafter from the premises of the Bank.

         10. Resignation. Executive shall have the right at any time during the
Employment Period upon One Hundred Eighty (180) days written notice to the Bank
to terminate the Employment Period, with or without cause. Such notice, when
given, shall be irrevocable. The Bank may in its discretion following delivery
by Executive of his notice of termination elect immediately to relieve Executive
of all or any part of his duties under this Agreement and to exclude Executive
thereafter from the premises of the Bank.

         11. Termination by Executive for Good Reason.

             (a) Termination. Executive shall have the right at any time
following a Change in Control (as defined below) upon Sixty (60) days written
notice to the Bank to terminate the Employment Period for Good Reason (as
defined below). Upon receipt of Executive's notice, the Bank may in its
discretion elect immediately to relieve Executive of all or any part of his
duties under this Agreement and to exclude Executive thereafter from the
premises of the Bank.

             (b) Good Reason. For purposes of this Agreement, "Good Reason"
shall mean: (i) a material breach of or default under any term or provision of
this Agreement by the Bank, (ii) a reduction by the Bank, in any material
respect and without Executive's written consent, of the authority, duties,
compensation, benefits or other terms and conditions of Executive's employment
hereunder, or (iii) a determination by Executive in good faith and in his sole
and absolute discretion made within twelve (12) months following the occurrence
of a Change in Control (as herein defined) that he is unable to work
harmoniously and effectively with the new management of the Bank or that he is
otherwise unable effectively to carry out his duties and to discharge his
responsibilities to the Bank hereunder.

             (c) Change in Control. For purposes of this Agreement, the term
"Change in Control" shall mean the occurrence of the following:

                 (1) There occurs a merger, consolidation, or other
         reorganization involving the Bank and another entity or a sale,
         exchange, transfer or other disposition of all or substantially all of
         the stock or assets of the Bank to another entity or person, other than
         Company or a person or entity which controls, is controlled by, or is
         under common control with Company, or a merger, consolidation, or other
         reorganization involving the Company and another entity or a sale,
         exchange, transfer or other disposition of all or substantially all of
         the stock or assets of the Company to another entity or person;

                 (2) Any "person" or "group" [as those terms are defined or used
         in Section 13(d) of the Securities Exchange Act of 1934 (the "Exchange
         Act"), as enacted and in force on the date hereof] is or becomes the
         "beneficial owner" (as that term is defined in Rule 13d-3 under the
         Exchange Act, as enacted and in force on the date hereof) of securities
         of Company or Bank representing Fifty (50%) percent or more of the
         combined voting power of, respectively, Company's or Bank's securities
         then outstanding;


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                 (3) There occurs a change in control of a nature that would be
         required to be reported in response to Item 6(e) of Schedule 14A of
         Regulation 14A promulgated under the Exchange Act, as enacted and in
         force on the date hereof, whether or not Bank or Company is then
         subject to such reporting requirement.

For purposes of this Agreement, the entity resulting from any Change in Control
which is successor to Bank or Company is herein referred to as the Successor
Company.

         12. Severance Benefit.

             (a) General. The Bank shall provide to Executive the severance
benefit provided for in this Section 12 in the event that the Employment Period
is terminated by reason of: (i) an election by the Bank not to renew this
Agreement pursuant to Section 6 above, (ii) an election by the Bank to terminate
the Employment Period without cause pursuant to Section 9 above, or (iii) an
election by Executive to terminate the Employment Period for Good Reason
pursuant to Section 11(b)(i) or 11(b)(ii) above. Executive shall not be entitled
to receive the severance benefit provided for in this Section 12 if the
Employment Period is terminated for any reason other than those identified in
the preceding sentence.

             (b) Salary Continuation. The Bank shall for a period of twelve (12)
months from the date of termination of the Employment Period continue to pay to
Executive the Base Salary in effect on the date of such termination. In the
event that Executive shall not have obtained Qualified Employment (as defined
below) at the expiration of such twelve-month period, the Bank shall continue to
pay such Base Salary to Executive for an additional twelve (12) months or until
Executive shall obtain Qualified Employment, whichever shall first occur. For
purposes of this Agreement the term "Qualified Employment" shall mean employment
or engagement as an officer, employee, consultant or independent contractor in a
comparable executive level position consistent with Executive's background and
experience.

             (c) Medical Insurance Premium Reimbursement. If Executive and his
dependents who are qualified beneficiaries are eligible to elect continuation of
medical 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 Bank 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 Bank are required to contribute toward the purchase of medical
insurance benefits under the personnel policies of the Bank then in effect,
which reimbursement shall continue until the first of the following to occur:
(i) the expiration of the Salary continuation Period as set forth in section
12(b) hereof, and (ii) the qualification of Executive and his qualified
beneficiaries for substantially equivalent coverage under any medical insurance
policy maintained by any future employer of Executive. Reimbursement as provided
for herein shall be made by the Bank to Executive monthly within five (5)
business days following the presentation by Executive to the Bank of evidence of
payment by him of the periodic COBRA continuation coverage premium for that
month.

             (d) Duty to Mitigate. Executive shall be obligated to mitigate the
obligation of the Bank to pay the severance benefit provided for in this Section
12 by using his best efforts to obtain Qualified Employment; provided, however,
that the salary continuation payments provided for in Section 12(b) above shall
not be reduced if Executive obtains Qualified Employment during the first twelve
(12) months following the date of termination of the Employment Period;
provided, further, that the obligation of the Bank to pay the salary
continuation payments provided for in Section 12(b) above after the expiration
of twelve (12) months from the date of termination of the Employment Period
shall terminate absolutely upon the first to occur of the following: (i) the
date on which Executive obtains Qualified Employment (even if the compensation
payable to Executive by reason of such Qualified Employment is less than the
Base Salary in effect on the date of termination of the Employment Period), and
(ii) the expiration of twenty-four (24) months from the date of termination of
the Employment Period.


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         13. Severance Benefit-Change in Control.

             (a) General. In the event of the occurrence of a Change in Control,
as defined in section 11 hereof, the Bank or, if Bank no longer exists, the
Successor Company shall provide to Executive the severance benefit provided for
in this Section 13 in the event that the Employment Period is terminated by
reason of an election by Executive to terminate the Employment Period for Good
Reason pursuant to Section 11(b)(iii) above or in the event that the Employment
Period is terminated by a Successor Company prior to the end of the Employment
Period by Successor Company for any reason other than for Cause, as described in
Section 8 hereof. Executive shall not be entitled to receive the severance
benefit provided for in this Section 13 if the Employment Period is terminated
for any reason other than those identified in the preceding sentence.

             (b) Salary Settlement. No later than thirty (30) days following the
receipt by Bank of written notice from Executive that Executive is electing to
terminate his employment under the provisions of section 11(b)(iii) hereof, Bank
shall pay to Executive a sum equal to three (3) times the then-current annual
compensation being received by Executive on the date of such notice, reduced by
any applicable employment or withholding taxes. The then-current annual
compensation may be in excess of the Base Salary, as herein defined.
Notwithstanding the foregoing, in the event that the payment described in this
subsection, when added to all other amounts or benefits provided to or on behalf
of the Executive in connection with his termination of employment as a result of
or in connection with a Change in Control, would result in the imposition of an
excise tax under section 4999 of the Internal Revenue Code of 1996, as amended
(the "Code"), 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 Bank's independent auditors, Executive
shall remit to Bank the amount of such 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 Code Section 280G,
then Bank shall be required to pay to Executive only the amount determined to be
deductible under said Section 280G. Executive shall not be required to mitigate
the amount of any payment for which provision is made in this Section 13(b) by
seeking other employment or otherwise, nor shall the amount of any payment or
benefit for which provision is made in this Section 13(b) be reduced as a result
of any payment or benefit which Executive may receive from any subsequent
employer. Foregoing

             (c) Medical Insurance Premium Reimbursement. If Executive and his
dependents who are qualified beneficiaries are eligible to elect continuation of
medical 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 Bank 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 Bank are required to contribute toward the purchase of medical
insurance benefits under the personnel policies of the Bank then in effect,
which reimbursement shall continue for a period of eighteen (18) months from the
date of Executive's written notice of his intention to exercise his rights under
the provisions of section 11(b)(iii) hereof. Reimbursement as provided for
herein shall be made by the Bank to Executive monthly within five (5) business
days following the presentation by Executive to the Bank of evidence of payment
by him of the periodic COBRA continuation coverage premium for that month.

         14. Certain Covenants.

             (a) Acknowledgment. Executive acknowledges that this Agreement
includes consideration which would not have been given but for the execution of
this Agreement by Executive.

             (b) Covenant Not to Compete. Executive covenants and agrees that he
will not during the Employment Period and for a period of twelve (12) months
following termination of the Employment Period directly or indirectly (whether
as principal, agent, proprietor, shareholder, salesman, employee, consultant,
independent contractor, officer, director, investor or otherwise) participate in
the ownership, management,



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operation, or control of or have any interest of any nature whatsoever in any
corporation, partnership, firm, or other business entity which is engaged in or
which proposes to engage in an activity constituting the providing of Banking
Services (as herein defined) within the Territory (as defined in the next
sentence). For purposes of this Agreement, the term "Territory" shall mean any
area designated by Bank or Successor Company as being within the market area of
the institution for purposes of compliance with the Community Reinvestment Act,
as amended, and all regulations implemented pursuant thereto, as of the date of
the termination of Executive's employment. For purposes of this Agreement, each
of the following shall constitute a "Banking Service":

         The acceptance of federally-insured deposit accounts, the providing of
         trust services, the providing of safe deposit box services, the
         providing of commercial, installment, personal, or mortgage loan
         services, the sale of mutual funds, the operation of an in-premises or
         free-standing automated teller machine, cash machine, or other
         mechanical device providing Banking Services (other than point-of sale
         machines utilized in processing credit sale transactions for goods or
         services sold in the facility housing such machine or machines), the
         sale or promotion of insurance products, the sale or promotion of
         mutual fund products, or the sale or promotion of securities; the
         providing of services, as an employee, director, officer, consultant,
         independent contractor, or otherwise, to any Financial Institution,
         which shall include, but not be limited to, federal or state chartered
         or private banks, savings banks, or savings and loans associations,
         consumer discount companies, mortgage banking companies, federal or
         state chartered credit unions, federal or state chartered private trust
         companies, secured dual-key or dual-controlled deposit or storage
         facilities, or any other entity providing Banking Services.

Notwithstanding the foregoing, the provisions of this Section 14(b) shall not
apply following termination of the Employment Period in the event that the
Employment Period is terminated by reason of: (i) an election by the Bank not to
renew this Agreement pursuant to Section 6 above, (ii) an election by the Bank
to terminate the Employment Period without cause pursuant to Section 9 above, or
(iii) an election by Executive to terminate the Employment Period for Good
Reason pursuant to Section 11 above.

             (c) Covenant Not to Solicit Employees. Without limitation of any
other provision of this Section 14, Executive covenants and agrees that he will
not during the Employment Period and for a period of Twenty-four (24) months
following termination of the Employment Period, directly or indirectly, employ
any person who is an employee of the Bank or solicit or otherwise attempt to
entice away from employment by the Bank any such employee.

             (d) Covenant Not to Solicit Customers. Without limitation of any
other provision of this Section 14, Executive agrees that he will not for a
period of Twenty-four (24) months following termination of the Employment
Period, directly or indirectly, solicit or attempt to establish any business
relationship with: (i) any person or entity who applied for and/or obtained a
loan or other banking relationship from or through the Bank prior to the
expiration of the Employment Period, or (ii) any person or entity who solicited
loans or other banking relationships on behalf of the Bank or who referred or
sold loans to the Bank prior to the expiration of the Employment Period.
Notwithstanding the foregoing, the provisions of this Section 14(d) shall not
apply following termination of the Employment Period in the event that the
Employment Period is terminated by reason of: (i) an election by the Bank not to
renew this Agreement pursuant to Section 6 above, (ii) an election by the Bank
to terminate the Employment Period without cause pursuant to Section 9 above, or
(iii) an election by Executive to terminate the Employment Period for Good
Reason pursuant to Section 11 above.

             (e) Covenant Not to Disclose or Use Confidential Information.
Executive recognizes and acknowledges that he will during the course of his
employment by the Bank have access to certain proprietary material and
confidential business information concerning the Bank's business, products,
operations, technical information, sales activities, procedures, promotion,
pricing techniques, customer lists, and credit and financial data which are a
valuable property of a confidential nature and which belong to the Bank. In
light of the highly competitive nature of the industry in which the business of
the Bank is conducted, Executive acknowledges and agrees that all such knowledge
and information not in the public domain shall be considered confidential


<PAGE>   9


information. Without limitation of any other provision of this Section 14,
Executive covenants and agrees in this connection that he will not during the
Employment Period or at any time thereafter disclose to any person for any
reason or purpose whatsoever (except in the regular course of the performance by
him of his duties hereunder) use for his own purposes, use for the benefit of
any other person or entity (other than the Bank) or use in competition with the
Bank any such proprietary material or confidential business information.

             (f) Specific Performance and Related Matters:

                 (1) Specific Performance: Executive acknowledges and agrees
         that any breach of the covenants set forth in this Section 14 will
         result in irreparable damage to the Bank, for which it will have no
         adequate remedy at law. Executive therefore agrees that, in the event
         of any such breach, the Bank shall be entitled, without limitation of
         any other rights or remedies otherwise available to it at law or in
         equity and without the posting of any bond, to obtain an injunction or
         other form of equitable relief from any court of competent
         jurisdiction.

                 (2) Extension: In the event that the Bank commences litigation
         against Executive for purposes of enforcing the covenants set forth in
         Sections 14(b), 14(c) and/or 14(d) above, the twelve (12) month
         restriction period shall be extended and shall continue throughout the
         period during which such litigation is pending. In addition, in the
         event that Executive is found by a court to have breached any of the
         covenants set forth in Sections 14(b), 14(c) and/or 14(d) above, the
         twelve (12) month restriction period shall be extended and shall
         continue until the expiration of twelve (12) months from the date upon
         which judgment is entered on the records of the court.

         15. Governing Law and Related Matters.

             (a) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Pennsylvania,
without reference to its law on the choice of laws.

             (b) Exclusive Jurisdiction. The Bank and Executive agree that the
Court of Common Pleas of Lancaster County, Pennsylvania shall have exclusive
jurisdiction with respect to any action arising out of or relating to this
Agreement and each hereby irrevocably submits to the jurisdiction of such court
and waives any objection to jurisdiction or venue.

             (c) Waiver of Certain Damages. The Bank and Executive each hereby
waive to the fullest extent permitted by law the right to assert against the
other any claim for punitive and/or exemplary damages. Without limitation of the
foregoing, Executive further agrees that, in the event that he should assert any
claim against the Bank for wrongful termination or other breach of this
Agreement prior to the occurrence of a Change in Control, the relief to which he
is entitled shall be limited to the recovery from the Bank of monetary damages
in an amount equal to his Lost Compensation (as defined in the next sentence).
For purposes of this Agreement, the term "Lost Compensation" shall mean the
difference between the Base Salary and Additional Compensation actually received
by Executive and the Base Salary and Additional Compensation which he would have
received under this Agreement, but for its termination prior to the end of the
Employment Period; Executive shall not be entitled to any other form of relief,
including, without limitation: (i) damages for tortious conduct, emotional
distress, pain and suffering, or injury to reputation, (ii) pay beyond the end
of the Employment Period, (iii) specific performance of any provision of this
Agreement, or (iv) reinstatement of employment. Bank, Company, and Executive
each waives any and all rights such party may have to a jury trial in connection
with any litigation commenced by or against any of the parties to this Agreement
with respect to rights and obligations of the parties hereto under this
Agreement.

         16. Miscellaneous Provisions.

             (a) Parties in Interest. This Agreement shall be binding upon,
inure to the benefit of, and be enforceable by Executive (his heirs,
representatives, executors, and administrators) and Bank (or its successors and


<PAGE>   10


assigns, subject to the limitations set forth in this section). This Agreement
shall be assignable by Bank and/or Company, subject to the limitations set forth
in this section. This Agreement may not be assigned by Bank or Company without
the prior written consent of Executive if:

                 (1) The entity to which this Agreement is to be assigned will
         not, after such assignment, be conducting all or substantially all of
         the types of business conducted by Bank prior to such assignment; and

                 (2) Bank will, after such assignment, continue to exist as an
         entity separate and apart from the assignee of this Agreement and to
         conduct all or substantially all of the types of business conducted by
         Bank prior to such assignment.

Executive may not assign this Agreement or any of his rights hereunder, except
as expressly herein provided.

            (b) Severability. The covenants and other undertakings set forth in
this Agreement (including, without limitation, the provisions of Sections 14(b)
and 14(c) above) are severable and if any covenant or portion thereof is held to
be invalid or unenforceable for any reason, such covenant or portion thereof
shall be modified to the extent necessary to cure such invalidity or
unenforceability and all other covenants and provisions of this Agreement shall
remain valid and enforceable.

            (c) Payments in the Event of Executive's Death. In the case of any
payment required under this Agreement to be made by the Bank to Executive after
his death, such payment shall be made to Executive's spouse if she survives him
or to Executive's estate if she does not survive him.

            (d) Notices. All notices and other communications required to be
given or made hereunder shall be in writing and shall be deemed to have been
given or made when hand delivered or when mailed, certified mail, return receipt
requested, to the Bank or to Executive, as the case may be, at their respective
addresses set forth on the first page of this Agreement or to such other address
as the Bank or Executive may subsequently designate in writing and deliver as
provided in this Section 16(d).

            (e) Waiver. The waiver by any party of a breach by the other party
or of compliance with any condition or provision of this Agreement shall not
operate as or be construed to be a waiver of any subsequent breach or right to
require compliance with any condition or provision of this Agreement.

            (f) Captions. The captions of the several Sections and Subsections
of this Agreement are inserted for convenience of reference only, constitute no
part of this Agreement and are not to be considered in the construction hereof.

            (g) Entire Agreement. This Agreement constitutes the entire
Agreement between the Bank and Executive concerning the subject matter hereof
and supersedes all prior written or oral agreements and understandings between
them.

            (h) Amendment. No term or provision of this Agreement may be
changed, waived, amended, terminated or otherwise modified, except by written
instrument duly executed by the Bank and by Executive.


<PAGE>   11


         IN WITNESS WHEREOF, this Agreement is executed the day and year first
above written.


ATTEST:                                    PENNROCK FINANCIAL SERVICES CORP.
/s/  Robert K. Weaver, Secretary           By: /s/  Glenn H. Weaver, President
------------------------------------          ---------------------------------

ATTEST:                                    BLUE BALL NATIONAL BANK
/s/  Robert K. Weaver, Secretary           By: /s/  Norman Hahn, Chairman
------------------------------------          ---------------------------------

WITNESS:
/s/  Joyce E. Redcap                           /s/ Melvin Pankuch         (SEAL)
------------------------------------          ----------------------------------
                                               MELVIN PANKUCH