EXHIBIT 10.11

                     COMMUNITY BANKS, NATIONAL ASSOCIATION
                          SALARY CONTINUATION AGREEMENT


     THIS AGREEMENT is made  effective this 1st day of July,  1999, by COMMUNITY
BANKS, NATIONAL ASSOCIATION, a Pennsylvania national banking association located
in  Millersburg,   Pennsylvania  (the  "Company")  and  ROBERT  W.  LAWLEY  (the
"Executive").

                                  INTRODUCTION

     To  encourage  the  Executive  to remain an  employee of the  Company,  the
Company is willing to provide salary continuation benefits to the Executive. The
Company will pay the benefits from its general assets.

                                    AGREEMENT

     The Executive and the Company agree as follows:

                                    Article 1
                                   Definitions

     1.1  Definitions.  Whenever used in this Agreement, the following words and
          phrases shall have the meanings specified:

          1.1.1 "Change of Control" shall mean any of the following:

                    (A) An  acquisition  by any  "person"  or "group"  (as those
               terms are defined or used in Section  13(d) of the Exchange  Act,
               as  enacted  and in  force  on the date  hereof)  of  "beneficial
               ownership"  (within the meaning of Rule 13d-3 under the  Exchange
               Act, as enacted and in force on the date hereof) of securities of
               Company  representing 24.99% or more of the combined voting power
               of Company's securities then outstanding;

                    (B) A merger, consolidation or other reorganization of Compa
               ny, except where the resulting entity is controlled,  directly or
               indirectly, by Company;

                    (C) A merger, consolidation or other reorganization of Compa
               ny, except where  shareholders  of Company  immediately  prior to
               consummation of any such transaction  continue to hold at least a
               majority of the voting power of the outstanding voting securities
               of  the  legal  entity  resulting  from  or  existing  after  any
               transaction  and a  majority  of  the  members  of the  Board  of
               Directors of the legal entity  resulting from or existing after a
               transaction are former members of Company's Board of Directors;


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                    (D) A sale,  exchange,  transfer  or  other  disposition  of
               substantially  all of the assets of  Company  to another  entity,
               except  to an  entity  controlled,  directly  or  indirectly,  by
               Company or a corporate division involving Company;

                    (E) A contested proxy solicitation of Company's shareholders
               that results in the  contesting  party  obtaining  the ability to
               cast  twenty-five  percent (25%) or more of the votes entitled to
               be cast in an election of directors of Company.


          Notwithstanding  anything  else  to the  contrary  set  forth  in this
     Agreement,  if (i) an  agreement  is  executed  by the  Corporation  or the
     Company  providing for any of the  transactions  or events  constituting  a
     Change of Control as defined herein, and the agreement subsequently expires
     or is terminated  without the transaction or event being  consummated,  and
     (ii)  Executive's  employment did not terminate during the period after the
     agreement and prior to such expiration or termination, for purposes of this
     Agreement it shall be as though such  agreement  was never  executed and no
     Change of Control event shall be deemed to have occurred as a result of the
     execution of such agreement.


          1.1.2 "Code" means the Internal Revenue Code of 1986, as amended.

          1.1.3 "Corporation" means Community Banks, Inc.

          1.1.4 "Disability" means the Executive suffering a sickness,  accident
               or injury which,  in the judgment of a physician  satisfactory to
               the Company, prevents the Executive from performing substantially
               all of the Executive's normal duties for the Company for a period
               of nine (9) months of any twelve (12)  consecutive  month period.
               As a  condition  to any  benefits,  the  Company  may require the
               Executive to submit to such  physical or mental  evaluations  and
               tests as the Company's Board of Directors deems appropriate.

          1.1.5 "Early Termination"  means the Termination of Employment  before
               Normal  Retirement Age for reasons other than death,  Disability,
               Termination for Cause or following a Change of Control.

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          1.1.6 "Early  Termination  Date" mean the month, day and year in which
               Early Termination occurs.

          1.1.7 "Normal Retirement Age" means the Executive's 62nd birthday.

          1.1.8 "Normal  Retirement   Date"   means  the  later  of  the  Normal
               Retirement Age or Termination of Employment.

          1.1.9 "Plan Year" means each twelve-month  period  commencing with the
               effective date of this Agreement.

          1.1.10 "Termination for Cause" See Section 5.2.

          1.1.11 "Termination of Employment"  means that the Executive ceases to
               be employed by the Company for any reason  whatsoever  other than
               by reason of a leave of absence which is approved by the Company.
               For  purposes of this  Agreement,  if there is a dispute over the
               employment status of the Executive or the date of the Executive's
               Termination  of  Employment,  the Company shall have the sole and
               absolute right to decide the dispute.


                                    Article 2
                                Lifetime Benefits

     2.1 Normal Retirement  Benefit.  Upon Termination of Employment on or after
the Normal Retirement Age for reasons other than death, the Company shall pay to
the  Executive  the benefit  described  in this Section 2.1 in lieu of any other
benefit under this Agreement.

          2.1.1 Amount of Benefit. The annual  Normal  Retirement  Benefit under
               this Section 2.1 is Thirty-five  Thousand ($35,000) Dollars.  The
               annual benefit amounts on Schedule A are calculated by amortizing
               the annual normal retirement benefit using the interest method of
               accounting,  a  7.00%  discount  rate,  monthly  compounding  and
               monthly payments.

          2.1.2 Payment of Benefit. The Company shall pay the annual  benefit to
               the  Executive in 12 equal  monthly  installments  payable on the
               first day of each month  commencing  with the month following the
               Executive's   Normal  Retirement  Date  and  continuing  for  239
               additional months.

     2.2 Early Termination Benefits.  Upon Early Termination,  the Company shall
pay to the  Executive  the benefit  described in this Section 2.2 in lieu of any
other benefit under this Agreement.

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          2.2.1 Amount of Benefit. The annual  benefit under this Section 2.2 is
               the Early Termination  Annual Benefit set forth in Schedule A for
               the Plan Year ending  immediately  prior to the Early Termination
               Date.

          2.2.2 Payment of Benefit. The Company shall pay the annual  benefit to
               the  Executive in 12 equal  monthly  installments  payable on the
               first day of each month  commencing  with the month following the
               Executive's   Normal   Retirement  Age  and  continuing  for  239
               additional months.

     2.3  Disability  Benefit.  If the Executive  terminates  employment  due to
Disability  prior  to  Normal  Retirement  Age,  the  Company  shall  pay to the
Executive the benefit described in this Section 2.3 in lieu of any other benefit
under this Agreement.

          2.3.1 Amount of Benefit. The annual  benefit under this Section 2.3 is
               the  Disability  Benefit  amount set forth in  Schedule A for the
               Plan  Year  ending   immediately  prior  to  the  date  in  which
               Termination of Employment occurs.

          2.3.2 Payment of Benefit. The Company shall have the option to pay the
               accrued  benefit  equivalent of the Disability  Annual Benefit to
               the  Executive  in a lump sum  within  sixty  (60) days after the
               Executive's termination of employment.  The Company shall pay the
               benefit  to  the  Executive  in  12  equal  monthly  installments
               commencing  within  90 days  after  the  date of the  Executive's
               Termination  of  Employment  and  continuing  for 239  additional
               months.

     2.4 Change of Control Benefit. If the Executive is in the active service of
the  Company at the time of a Change of Control,  the  Company  shall pay to the
Executive the benefit described in this Section 2.4 in lieu of any other benefit
under this Agreement.

          2.4.1 Amount of Benefit. The annual  benefit under this Section 2.4 is
               the Early  Termination  Benefit set forth in Schedule A, based on
               two (2) years plus the number of Plan Years completed on the date
               of the  Executive's  termination  of  employment,  not to  exceed
               seventeen (17) years.

          2.4.2 Payment of Benefit. The Company shall pay the annual  benefit to
               the  Executive in 12 equal  monthly  installments  payable on the
               first day of each month  commencing  with the month following the
               Executive's   Normal   Retirement  Age  and  continuing  for  239
               additional  months or at the  Company's  option  pay the  Accrued
               Benefit  set forth on Schedule  "A" within  sixty (60) days after
               the Executive's termination of employment.



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                                    Article 3
                                 Death Benefits

     3.1 Death During Active Service.  If the Executive dies while in the active
service of the Company, the Company shall pay to the Executive's beneficiary the
benefit described in this Section 3.1. This benefit shall be paid in lieu of the
Lifetime Benefits of Article 2.

          3.1.1 Amount of Benefit. The annual  benefit under this Section 3.1 is
               the Normal Retirement Benefit described in Section 2.1.1.

          3.1.2 Payment of Benefit. The Company shall pay the annual  benefit to
               the beneficiary in 12 equal monthly  installments  payable on the
               first day of each month  commencing  with the month following the
               Executive's death and continuing for 239 additional months.

     3.2 Death During  Benefit  Period.  If the Executive dies after the benefit
payments  have  commenced  under this  Agreement  but before  receiving all such
payments,  the  Company  shall pay the  remaining  benefits  to the  Executive's
beneficiary  at the same time and in the same  amounts they would have been paid
to the Executive had the Executive survived.

     3.3 Death Following Termination of Employment But Before Benefits Commence.
If the Executive is entitled to benefits under this Agreement, but dies prior to
receiving said benefits,  the Company shall pay to the  Executive's  beneficiary
the  same  benefits,  in the same  manner,  they  would  have  been  paid to the
Executive  had the  Executive  survived;  however,  said benefit  payments  will
commence upon the Executive's death.


                                    Article 4
                                  Beneficiaries

     4.1 Beneficiary  Designations.  The Executive shall designate a beneficiary
by filing a written  designation  with the Company.  The Executive may revoke or
modify  the  designation  at any  time by  filing  a new  designation.  However,
designations  will only be effective if signed by the  Executive and accepted by
the  Company  during  the  Executive's  lifetime.  The  Executive's  beneficiary
designation shall be deemed automatically revoked if the beneficiary predeceases
the  Executive,  or if the  Executive  names a  spouse  as  beneficiary  and the
marriage  is  subsequently  dissolved.  If the  Executive  dies  without a valid
beneficiary designation, all payments shall be made to the Executive's estate.

     4.2  Facility of Payment.  If a benefit is payable to a minor,  to a person
declared incapacitated,  or to a person incapable of handling the disposition of
his or her  property,  the Company may pay such benefit to the  guardian,  legal
representative or person having the care or custody of such minor, incapacitated
person or  incapable  person.  The  Company  may  require  proof of  incapacity,
minority or guardianship as it may deem appropriate prior to distribution of the
benefit.  Such  distribution  shall  completely  discharge  the Company from all
liability with respect to such benefit.

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                                    Article 5
                               General Limitations

     Notwithstanding  any  provision  of this  Agreement  to the  contrary,  the
Company shall not pay any benefit under this Agreement:

     5.1 Termination for Cause.  Notwithstanding any provision of this Agreement
to the contrary, the Company shall not pay any benefit under this Agreement,  if
the Company terminates the Executives employment for:

          5.1.1 Gross negligence or gross neglect of duties;

          5.1.2 Commission of a felony or of a gross misdemeanor involving moral
               turpitude; or

          5.1.3 Fraud, disloyalty, dishonesty or willful violation of any law or
               significant  Company  policy  committed  in  connection  with the
               Executive's  employment and resulting in an adverse effect on the
               Company.

          5.1.4 Removal. Notwithstanding  any provision of this Agreement to the
               contrary,  the  Company  shall  not pay any  benefit  under  this
               Agreement  if the  Executive  is  subject  to a final  removal or
               prohibition order issued by an appropriate federal banking agency
               pursuant to Section 8(e) of the Federal Deposit Insurance Act.

     5.2  Competition  After  Termination  of  Employment.  No benefits shall be
payable,  except for benefits paid due to a Change of Control, if the Executive,
without the prior  written  consent of the Company,  engages in conduct which is
deemed to  violate  the  non-competition  clause of the  Executive's  Employment
Contract, which clause is hereby incorporated herein by reference,  both parties
further hereby acknowledging having received, read and understood a copy of said
Employment Contract.

     5.3 Suicide or  Misstatement.  If the Executive  commits suicide within two
years  after the date of this  Agreement,  or if the  insurance  company  denies
coverage  for  material  misstatements  of  fact  made by the  Executive  on any
application  for life insurance  purchased by the company,  or any other reason,
provided however that the Company shall evaluate the reason for the denial,  and
upon  advice  of  Counsel  and  in  its  sole  discretion,  consider  judicially
challenging any denial.


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                                    Article 6
                          Claims and Review Procedures

     6.1 Claims  Procedure.  The Company  shall notify any person or entity that
makes a claim against the Agreement (the  "Claimant") in writing,  within ninety
(90)  days  of  Claimant's  written  application  for  benefits,  of  his or her
eligibility or noneligibility  for benefits under the Agreement.  If the Company
determines that the Claimant is not eligible for benefits or full benefits,  the
notice shall set forth (1) the specific reasons for such denial,  (2) a specific
reference to the provisions of the Agreement on which the denial is based, (3) a
description of any additional information or material necessary for the Claimant
to perfect his or her claim,  and a description of why it is needed,  and (4) an
explanation of the  Agreement's  claims review  procedure and other  appropriate
information as to the steps to be taken if the Claimant wishes to have the claim
reviewed.  If the  Company  determines  that  there  are  special  circumstances
requiring  additional  time to make a  decision,  the Company  shall  notify the
Claimant  of the  special  circumstances  and the  date by which a  decision  is
expected to be made, and may extend the time for up to an additional ninety- day
period.

     6.2 Review  Procedure.  If the Claimant is determined by the Company not to
be eligible for benefits, or if the Claimant believes that he or she is entitled
to greater or different  benefits,  the Claimant  shall have the  opportunity to
have such claim reviewed by the Company by filing a petition for review with the
Company  within  sixty  (60) days  after  receipt  of the  notice  issued by the
Company.  Said  petition  shall state the  specific  reasons  which the Claimant
believes  entitle him or her to benefits  or to greater or  different  benefits.
Within sixty (60) days after receipt by the Company of the petition, the Company
shall afford the Claimant (and counsel, if any) an opportunity to present his or
her position to the Company orally or in writing,  and the Claimant (or counsel)
shall have the right to review the pertinent documents. The Company shall notify
the Claimant of its decision in writing  within the  sixty-day  period,  stating
specifically  the basis of its  decision,  written in a manner  calculated to be
understood by the Claimant and the specific provisions of the Agreement on which
the  decision is based.  If,  because of the need for a hearing,  the  sixty-day
period  is not  sufficient,  the  decision  may be  deferred  for up to  another
sixty-day  period at the  election of the Company,  but notice of this  deferral
shall be given to the Claimant.


                                    Article 7
                           Amendments and Termination

     This  Agreement  may be amended or terminated  only by a written  agreement
signed by the Company and the Executive.


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                                    Article 8
                                  Miscellaneous

     8.1  Binding  Effect.  This  Agreement  shall  bind the  Executive  and the
Company,   and   their   beneficiaries,    survivors,   executors,   successors,
administrators and transferees.

     8.2 No Guarantee of Employment.  This Agreement is not an employment policy
or contract.  It does not give the  Executive the right to remain an employee of
the Company,  nor does it interfere  with the  Company's  right to discharge the
Executive.  It also does not require  the  Executive  to remain an employee  nor
interfere with the Executive's right to terminate employment at any time.

     8.3  Non-Transferability.  Benefits  under this  Agreement  cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.

     8.4 Tax Withholding. The Company shall withhold any taxes that are required
to be withheld from the benefits provided under this Agreement.

     8.5  Applicable  Law.  The  Agreement  and all  rights  hereunder  shall be
governed by the laws of the Commonwealth of  Pennsylvania,  except to the extent
preempted by the laws of the United States of America.

     8.6  Unfunded  Arrangement.  The  Executive  and  beneficiary  are  general
unsecured  creditors  of the  Company  for the  payment of  benefits  under this
Agreement.  The benefits  represent  the mere promise by the Company to pay such
benefits.  The rights to benefits are not subject in any manner to anticipation,
alienation,  sale, transfer,  assignment,  pledge,  encumbrance,  attachment, or
garnishment  by creditors.  Any insurance on the  Executive's  life is a general
asset of the Company to which the Executive and beneficiary have no preferred or
secured claim.

     8.7 Recovery of Estate Taxes. If the  Executive's  gross estate for federal
estate tax  purposes  includes  any amount  determined  by  reference  to and on
account of this Agreement,  and if the beneficiary is other than the Executive's
estate,  then the  Executive's  estate  shall be  entitled  to recover  from the
beneficiary  receiving such benefit under the terms of the Agreement,  an amount
by which the total estate tax due by the Executive's  estate,  exceeds the total
estate tax which  would have been  payable if the value of such  benefit had not
been included in the Executive's  gross estate. If there is more than one person
receiving such benefit, the right of recovery shall be against each such person.
In the event the  beneficiary  has a liability  hereunder,  the  beneficiary may
petition  the  Company  for a lump sum  payment  in an amount  not to exceed the
beneficiary's liability hereunder.

     8.8 Entire  Agreement.  This  Agreement  constitutes  the entire  agreement
between the Company and the Executive as to the subject matter hereof. No rights
are  granted  to the  Executive  by virtue of this  Agreement  other  than those
specifically set forth herein.

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     8.9  Administration.  The Company  shall have power which are  necessary to
administer this Agreement, including but not limited to:

          8.9.1 Interpreting the provisions of the Agreement;

          8.9.2 Establishing  and  revising  the  method of accounting  for  the
               Agreement;

          8.9.3 Maintaining a record of benefit payments; and

          8.9.4 Establishing   rules  and  prescribing  an  forms  necessary  or
               desirable to administer the Agreement.


     IN WITNESS  WHEREOF,  the Executive and a duly  authorized  Company officer
have signed this Agreement.

EXECUTIVE:                                           COMPANY:
                                                     COMMUNITY BANKS, NATIONAL
                                                     ASSOCIATION

 /S/ Robert W. Lawley                                By /S/ Ernest L. Lowe
------------------------------------------              ------------------------
Robert W. Lawley                                        Title Chairman
                                                              ------------------


     By execution  hereof,  Community Banks,  Inc.  consents to and agrees to be
bound by the terms and condition of this Agreement.



ATTEST:                                              CORPORATION:
                                                     COMMUNITY BANKS, INC.

/S/ Patricia E. Hoch                                 By /S/ Ernest L. Lowe
-------------------------------------------             ------------------------
                                                        Title    Chairman
                                                            --------------------


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                AGREEMENT TO MODIFY SALARY CONTINUATION AGREEMENT

     THIS AGREEMENT TO MODIFY SALARY CONTINUATION AGREEMENT  ("Modification") is
entered into on this 14th day of January,  2002, by COMMUNITY  BANKS, a bank and
trust  company  organized  and existing  under the laws of the  Commonwealth  of
Pennsylvania,  successor  by merger to  Community  Banks,  N.A.  and  located in
Millersburg, Pennsylvania ("Bank"), and ROBERT W. LAWLEY (the "Executive").

                                   BACKGROUND

     A.  Bank  and  Executive  entered  into  an  Amended  and  Restated  Salary
Continuation  Agreement on or about July 1, 1999 (the "Agreement").

     B. Bank and  Executive  wish to clarify that the  definition  of "Change of
Control" in the Agreement applies to Community Banks, Inc. ("Corporation").

     NOW, THEREFORE, in consideration of the foregoing premises and intending to
be legally bound, the parties hereby agree as follows:

     1.  Modification of Change of Control  Definition.  The term "Company",  as
used in the definition of "Change of Control" in Section 1.1.1 of the Agreement,
is hereby  changed to  "Corporation"  and shall be deemed to refer to  Community
Banks, Inc.

     2. Effective Date. This Modification  shall be deemed to be effective as of
the date on which the parties first entered into the Agreement.

     3. No Other Changes.  Except as specifically modified herein, all terms and
conditions of the Agreement shall remain in full force and effect.

     IN WITNESS  WHEREOF,  the Executive and a duly authorized Bank officer have
signed this Agreement.

EXECUTIVE:                                               COMMUNITY BANKS

/S/ Robert W. Lawley                                By /S/ Eddie L. Dunklebarger
------------------------------------                    ------------------------
Robert W. Lawley                                        Title President & CEO


     By execution  hereof,  Community Banks,  Inc.  consents to and agrees to be
bound by the terms and condition of this Modification.

WITNESS/ATTEST:                                        COMMUNITY BANKS, INC.

/S/ Patricia E. Hoch                                By /S/ Eddie L. Dunklebarger
-------------------------------------                  -------------------------
                                                       Title Chairman & CEO
                                                           ---------------------



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