Exhibit 10.11

                             FIRST AMENDMENT TO THE
                              GRANGE NATIONAL BANK
                              AMENDED AND RESTATED
                  SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

      This First Amendment to the Grange National Bank Amended and Restated
Supplemental Executive Retirement Agreement is entered into as of March 26,2003
by and between GRANGE NATIONAL BANK, a nationally-chartered commercial bank
located in Laceyville, Pennsylvania (the "Company"), and THOMAS A. McCULLOUGH
(the "Executive").

      On January 17,2003, the Company and the Executive entered into an Amended
and Restated Supplemental Retirement Agreement (the "Agreement"). The parties
now desire to amend the Agreement as set forth herein.

      The parties hereto, intending to be legally bound hereby, agree as
follows:

      1. Section 2.5 of the Agreement is amended by adding the following
sentence at the end of the Section:

      Notwithstanding any other provisions to the contrary in this Section 2.5,
      the Company shall not pay the Change of Control Benefit but shall instead
      pay the Early Retirement Benefit in the amounts and at the times provided
      in Section 2.3 hereof if (a) the payment of the Change of Control Benefit
      would cause the amount of any other payments that the Executive otherwise
      has the right to receive from the Company to be reduced as a result of
      such other payments and the Change of Control Benefit being limited to the
      largest amount as will result in no portion of them being subject to
      excise tax imposed under Section 4999 of the Code, or (b) the payment of
      the Change of Control Benefit would cause the sum of (i) any other
      payments that the Executive has the right to receive from the Company and
      (ii) the Change in Control Benefits to be a "parachute payment," as
      defined by Section 280G of the Code.

      2. All other terms and conditions of the Agreement remain in full force
and effect.

      IN WITNESS WHEREOF, the Company and the Executive have caused this First
Amendment to be duly executed as of the date first above written.

EXECUTIVE                               GRANGE NATIONAL BANK


/s/ Thomas A. McCullough                By: /s/ Sally A. Steele, Secretary
------------------------------              ---------------------------------
Thomas A. McCullough                          Sally A. Steele
                                                       As its Secretary

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               (C) 2002 Clark/Bardes Consulting-Banking Practice

This document is provided to assist your legal counsel in documenting your
specific arrangement. The laws of the various states may differ considerably,
and this specimen is for general information only. It is not a form to be
signed, nor is it to be construed as legal advice. Failure to accurately
document your arrangement could result in significant losses, whether from
claims of those participating in the arrangement, from the heirs and
beneficiaries of Executives, or from regulatory agencies such as the Internal
Revenue Service, the Department of Labor, or bank examiners. License is hereby
granted to your legal counsel to use these materials in documenting solely your
arrangement.

                              GRANGE NATIONAL BANK
                              AMENDED AND RESTATED
                  SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

<PAGE>

                              GRANGE NATIONAL BANK
                              AMENDED AND RESTATED
                  SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

      This Agreement is entered into this January 17, 2003, by and between
GRANGE NATIONAL BANK, a nationally-chartered commercial bank located in
Laceyville, Pennsylvania (the "Company"), and THOMAS A. MCCULLOUGH (the
"Executive").

      On January 1, 1996, the Company and the Executive entered into an
Executive Supplemental Income Agreement (the "Prior Agreement"). Pursuant to its
powers to amend the Prior Agreement, the Company hereby amends and restates the
Prior Agreement in its entirety.

      The purpose of this Agreement is to provide specified benefits to the
Executive, a member of a select group of management or highly compensated
employees who contribute materially to the continued growth, development and
future business success of the Company. This Agreement shall be unfunded for tax
purposes and for purposes of Title I of ERISA.

                                   ARTICLE 1
                                  DEFINITIONS

      The following words and phrases shall have the following meanings, unless
the context requires otherwise:

1.1   "Accrual Balance" means the liability accrued on the books of the Company
      for the Company's obligation for the Normal Retirement Benefit, using
      generally accepted accounting principles.

1.2   "Beneficiary" means each designated person, or the estate of the
      Executive, entitled to benefits, if any, upon the death of the Executive
      determined pursuant to Article 3.

1.3   "Beneficiary Designation Form" means the form established from time to
      time by the Plan Administrator that the Executive completes, signs and
      returns to the Plan Administrator to designate one or more Beneficiaries.

1.4   "Board" means the Board of Directors of the Company as from time to time
      constituted.

1.5   "Change of Control" means

      (a) A change in the ownership of the capital stock of the Company or the
      Corporation, whereby another corporation, person, or group acting in
      concert

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      (hereinafter this Agreement shall collectively refer to any combination of
      these three [another corporation, person, or group acting in concert] as a
      "Person") as described in Section 14(d)(2) of the Securities Exchange Act
      of 1934, as amended (the "Exchange Act"), acquires, directly or
      indirectly, beneficial ownership (within the meaning of Rule 13d-3
      promulgated under the Exchange Act) of a number of shares of capital stock
      of the Company or the Corporation which constitutes fifty percent (50%) or
      more of the combined voting power of the Company's or the Corporation's
      then outstanding capital stock then entitled to vote generally in the
      election of directors; or

      (b) The persons who were members of the Board of Directors of the Company
      or the Corporation's immediately prior to a tender offer, exchange offer,
      contested election or any combination of the foregoing, cease to
      constitute a majority of the Board of Directors; or

      (c) The adoption by the Board of Directors of the Company or the
      Corporation of a merger, consolidation or reorganization plan involving
      the Company or the Corporation in which the Company or the Corporation is
      not the surviving entity, or a sale of all or substantially all of the
      assets of the Company or the Corporation. For purposes of this Agreement,
      a sale of all or substantially all of the assets of the Company or the
      Corporation shall be deemed to occur if any Person acquires (or during the
      12-month period ending on the date of the most recent acquisition by such
      Person, has acquired) gross assets of the Company or the Corporation that
      have an aggregate fair market value equal to fifty percent (50%) or more
      of the fair market value of all of the respective gross assets of the
      Company or the Corporation immediately prior to such acquisition or
      acquisitions; or

      (d) A tender offer or exchange offer is made by any Person which results
      in such Person beneficially owning (within the meaning of Rule 13d-3
      promulgated under the Exchange Act) either fifty percent (50%) or more of
      the Company's or the Corporation's outstanding shares of Common Stock or
      shares of capital stock having fifty percent (50%) or more the combined
      voting power of the Company's or the Corporation's then outstanding
      capital stock (other than an offer made by the Company or the
      Corporation), and sufficient shares are acquired under the offer to cause
      such person to own fifty percent (50%) or more of the voting power; or

      (e) Any other transactions or series of related transactions occurring
      which have substantially the same effect as the transactions specified in
      any of the preceding clauses of this Section I.5.

      Notwithstanding the above, certain transfers are permitted within Section
      318 of the Code and such transfers shall not be deemed a Change of
      Control under this Section 1.5.

1.6   "Code" means the Internal Revenue Code of 1986, as mended.

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1.7   "Compensation" means the annual compensation, including bonuses,
      commissions, overtime, relocation expenses, incentive payments,
      non-monetary awards, and including automobile allowances paid to the
      Executive for employment services rendered to the Company, before
      reduction for compensation deferred pursuant to all qualified,
      non-qualified and Code ss. 125 plans of the Company.

1.8   "Corporation" means Grange National Banc Corp., a Pennsylvania
      corporation.

1.9   "Disability" means a condition whereby the Executive, because of a
      physical or mental sickness, accident or injury, is or will be unable to
      perform the duties of the Executive's customary position of employment
      with the Company or any other employer. The Board, in its sole discretion,
      shall determine whether the Executive is disabled and may require the
      Executive to submit to a physical examination in order to determine
      disability.

1.10  "Disability Benefit" means the benefit as set forth in Section 2.4.

1.12  "Early Retirement Benefit" means the benefit as set forth in Section 2.3.

1.13  "Effective Date" means 1/1/96.

1.14  "Final Compensation" means the average of the Executive's Compensation for
      his or last five calendar years of employment (including the annualized
      compensation for the calendar year in which the event that entitled the
      Executive to a distribution of benefits under this Agreement occurred).

1.15  "Normal Retirement Age" means the Executive's sixty-second (62nd)birthday.

1.16  `Normal Retirement Benefit" means the benefit as set forth in Section 2.2,

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

1.18  "Pension Benefit" means the balance in the Executive's 401(k) (as of the
      date any benefits are being determined) attributed to all Company
      contributions, plus the return on those contributions, amortized over a
      two hundred forty (240) month period with interest calculated on the
      unpaid balance at an annual rate of eight ' percent (8%), compounded
      monthly.

1.19  "Plan Administrator" means the plan administrator described in Article 5.

1.20  "Plan Year" means the twelve (12) month period from January 1 to December
      3I.

1.21  "Termination for Cause" means termination of the Executive's employment
      for: (a) gross negligence or gross neglect of duties; (b) commission of a
      felony or of a gross misdemeanor involving moral turpitude; or (c) actions
      inimical to the

<PAGE>

      interests of the Company, including but not limited to fraud, disloyalty,
      dishonesty or willful violation of any law or significant Company policy
      committed in connection with the Executive's employment and resulting in a
      material adverse effect on the Company.

1.22  "Termination of Employment" means the date on which the Executive (i)
      retires, resigns or ceases to be an employee; (ii) dies while in the
      active employ of the Company; or (iii) departs from the service of the
      Company for any reason; provided, that the Executive will not be deemed to
      have terminated the Executive's employment solely by reason of a leave of
      absence duly approved by the Company.

1.23  "Years of Service" means the twelve consecutive month period beginning on
      the Executive's date of hire and any twelve (12) month anniversary
      thereof, during the entirety of which time the Executive is an employee of
      the Company. The Plan Administrator in its discretion may also grant
      additional Years of Service in such circumstances where it deems such
      additional service appropriate.

                                   ARTICLE 2
                         RETIREMENT AND DEATH BENEFITS

2.1   Agreement Benefits. The Executive's benefits under this Agreement shall be
      limited to those described in this Article 2, and shall be subject to any
      conditions and limitations set forth in Article 4 and contained elsewhere
      in this Agreement.

2.2   Normal Retirement Benefit. Upon the Normal Retirement Date, the Company
      shall pay to the Executive an annual Normal Retirement Benefit equal to
      eighty- five percent (85%) of the Executive's Final Compensation reduced
      by the (a) Pension Benefit, and (b) fifty percent (50%) of the Social
      Security benefit that would be receivable by the Executive calculated as
      if the Executive's Normal Retirement Age were also his normal retirement
      age or age at which unreduced Social Security benefits were available
      under the Social Security law (regardless of whether any Social Security
      benefits are actually payable currently on the Executive's Normal
      Retirement Date). The Company shall pay the Normal Retirement Benefit to
      the Executive in twelve (12) equal monthly installments commencing as of
      the first day of the month following the Executive's Normal Retirement
      Date and payable during the Executive's lifetime on or around the first
      day of each successive month thereafter until the Executive has received
      one hundred eighty (180) installments. Upon making all of such
      installments, the Company's obligation to provide such payments will
      cease. No further benefit under this Agreement is to be provided.

2.3   Earls Retirement Benefit Upon the Executive's Termination of Employment
      before the Normal Retirement Date, the Company shall pay to the Executive
      an annual Early Retirement Benefit, determined by amortizing the Accrual
      Balance over one hundred eighty (180) equal monthly installments at an
      annual rate of

<PAGE>

      interest equal to the Prime Rate as published in the Wall Street Journal
      on the last business day immediately preceding the Executive's Termination
      of Employment. The Company shall pay the Early Retirement Benefit to the
      Executive commencing as of the first day of the month following the
      Executive's Termination of Employment and payable during the Executive's
      lifetime on or around the first day of each successive month thereafter
      until the Executive has received one hundred eighty (180) installments.
      Upon making all of such installments, the Company's obligation to provide
      such payments will cease. No further benefit under this Agreement is to be
      provided.

2.4   Disability Benefit. Upon Termination of Employment due to Disability prior
      to Normal Retirement Age, the Company shall pay to the Executive an annual
      Disability Benefit, determined by amortizing the Accrual Balance over one
      hundred eighty (180) equal monthly installments at an annual rate of
      interest equal to the Prime Rate as published in the Wall Street Journal
      on the last business day immediately preceding the Executive's Termination
      of Employment. The Company shall pay the Disability Benefit to the
      Executive commencing as of the first day of the month following the
      Executive's Termination of Employment and payable during the Executive's
      lifetime on or around the first day of each successive month thereafter
      until the Executive has received one hundred eighty (180) installments.
      Upon making all of such installments, the Company's obligation to provide
      such payments will cease. No further benefit under this Agreement is to be
      provided.

2.5   Chance of Control Benefit. Following a Change of Control, upon the
      Executive's Termination of Employment for reasons other than death,
      Disability or attaining Normal Retirement Age, the Company shall pay to
      the Executive an annual Change of Control Benefit equal to eighty-five
      percent (85%)of the Executive's Final Compensation reduced by the (a)
      Pension Benefit, and (b) fifty percent (50%) of the Social Security
      benefit that would be receivable by the Executive calculated as if the
      Executive's age at Termination of Employment were also his normal
      retirement age or age at which unreduced Social Security benefits were
      available under the Social Security law (regardless of whether any Social
      Security benefits are actually payable currently on the Executive's Normal
      Retirement Date). The Company shall pay the Change of Control Benefit to
      the Executive in twelve (12) equal monthly installments commencing as of
      the first day of the month following the Executive's Termination of
      Employment and payable during the Executive's lifetime on or around the
      first day of each successive month thereafter until the Executive has
      received one hundred eighty (180) installments. Upon making all of such
      installments, the Company's obligation to provide such payments will
      cease. No further benefit under this Agreement is to be provided.

2.6   Pre-Retirement Death Benefit. If the Executive dies while in the active
      employ by the Company, the Company shall pay to the Beneficiary the
      following benefits:

                  Year 1:         100% of Compensation
                  Years 2-5:       75% of Compensation
                  Years 6-15:      50% of Compensation

<PAGE>

      The Company shall pay the Pre-Retirement Death Benefit to the Beneficiary
      in twelve (12) monthly installments commencing as of the first day of the
      month following the Executive's death and on or around the first day of
      each successive month thereafter until the Executive's beneficiary has
      received one hundred eighty (180) installments. Upon making all of such
      installments, the Company's obligation to provide such payments will
      cease. No further benefit under this Agreement is to be provided.

2.7   Post-Commencement Death Benefit. If the Executive dies after any benefit
      payments have commenced under this Article but before receiving all such
      payments, the Company shall pay to the Beneficiary the remaining benefits
      at the same time, for such duration and in the same amounts they would
      have been paid to the Executive had the Executive survived.

2.8   Post-Retirement, Commencement Death Benefit. If the Executive is entitled
      to a benefit under this Article, but dies prior to the commencement of
      said benefit payments, the Company shall pay the same benefit payments to
      the Beneficiary that the Executive was entitled to prior to death except
      that the benefit payments shall commence on the first day of the month
      following the date of the Executive's death.

2.9   Withholding and Payroll Taxes. The Company shall withhold from any and all
      benefits made under this Article 2, all federal, state and local income
      taxes, employment and other taxes required to be withheld by the Company
      in connection with the benefits hereunder, in amounts to be determined in
      the sole discretion of the Company.

                                   ARTICLE 3
                                 BENEFICIARIES

3.1   Beneficiary. The Executive shall have the right, at any time, to designate
      a Beneficiary(ies) to receive any benefits payable under this Agreement to
      a beneficiary upon the death of the Executive. The Beneficiary designated
      under this Agreement may be the same as or different from the Beneficiary
      designation under any other plan of the Company in which the Executive
      participates.

3.2   Beneficiary Designation; Change. The Executive shall designate a
      Beneficiary by completing and signing the Beneficiary Designation Form,
      and delivering it to the Plan Administrator or its designated agent. 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. The
      Executive shall have the right to change a Beneficiary by completing,
      signing and otherwise complying with the terms of the

<PAGE>

      Beneficiary Designation Form and the Plan Administrator's rules and
      procedures, as in effect from time to time. Upon the acceptance by the
      Plan Administrator of a new Beneficiary Designation Form, all Beneficiary
      designations previously filed shall be cancelled. The Plan Administrator
      shall be entitled to rely on the last Beneficiary Designation Form filed
      by the Executive and accepted by the Plan Administrator prior to the
      Executive's death.

3.3   Acknowledgement. No designation or change in designation of a Beneficiary
      shall be effective until received, accepted and acknowledged in writing by
      the Plan Administrator or its designated agent.

3.4   No Beneficiary Designation. If the Executive dies without a valid
      beneficiary designation, or if all designated Beneficiaries predecease the
      Executive, then the Executive's spouse shall be the designated
      Beneficiary. If the Executive has no surviving spouse, the benefits shall
      be made to the personal representative of the Executive's estate.

3.5   Facility of Payment. If the Plan Administrator determines in its
      discretion that a benefit is to be paid to a minor, to a person declared
      incompetent, or to a person incapable of handling the disposition of that
      person's property, the Plan Administrator may direct payment of such
      benefit to the guardian, legal representative or person having the care or
      custody of such minor, incompetent person or incapable person. The Plan
      Administrator may require proof of incompetence, minority or guardianship
      as it may deem appropriate prior to distribution of the benefit. Any
      payment of a benefit shall be a payment for the account of the Executive
      and the Executive's Beneficiary, as the case may be, and shall be a
      complete discharge of any liability under the Agreement for such payment
      amount.

                                   ARTICLE 4
                        GENERAL LIMITATIONS ON BENEFITS

4.1   Termination for Cause. If there is a Termination for Cause by the Company
      of the Executive, the Executive shall cease participation hereunder as of
      the date of such termination and no benefits shall be paid to the
      Executive or the Executive's Beneficiary.

4.2   Requirement of Non-Competition. The Company shall not pay to the Executive
      any benefit under this Agreement if, during the term that benefits
      payments are being made, the Executive, without the prior written consent
      of the Board engages in, becomes interested in, directly or indirectly, as
      a sole proprietor, as a partner in a partnership, or as a substantial
      shareholder in a corporation, or becomes associated with, in the capacity
      of employee, director, officer, principal, agent, trustee or in any other
      capacity whatsoever, any enterprise conducted within twenty-five (25)
      miles of any office of the Company existing as of the date of the
      Executive's Termination of Employment, which

<PAGE>

      enterprise is, or may deemed to be, competitive with any business carried
      on by the Company as of the date of the Executive's Termination of
      Employment. This section shall not apply following a Change of Control.

4.3   Services. Payment of the Early Retirement Benefit or Normal Retirement
      Benefit is conditioned upon the Executive, while receiving payments under
      this Agreement, rendering such reasonable business consulting and advisory
      services to the Company as requested by the Board. Such services shall not
      require the Executive to be active in the Company's day-to-day activities,
      and the Executive shall be compensated for such services in an amount to
      be then agreed upon, and shall be reimbursed for all expenses incurred in
      performing such services.

4.4   Executive's Suicide or Misstatement. The Company shall not pay any benefit
      under this Agreement if the Executive commits suicide within two years of
      the Effective Date of this Agreement. In addition, the Company shall not
      pay any benefit under this Agreement if the Executive has made any
      material misstatement of fact on any application for insurance or any
      benefits provided by the Company to the Executive.

                                   ARTICLE 5
                          ADMINISTRATION OF AGREEMENT

5.1   Plan Administrator Duties. This Agreement shall be administered by a Plan
      Administrator which shall consist of the Board, or such committee as the
      Board shall appoint. The Executive may be a member of the Plan
      Administrator. The Plan Administrator shall also have the discretion and
      authority to (i) make, amend, interpret and enforce all appropriate rules
      and regulations for the administration of this Agreement and (ii) decide
      or resolve any and all questions including interpretations of this
      Agreement, as may arise in connection with the Agreement.

5.2   Agents. In the administration of this Agreement, the Plan Administrator
      may employ agents and delegate to them such administrative duties as it
      sees fit, (including acting through a duly appointed representative), and
      may from time to time consult with counsel who may be counsel to the
      Company.

5.3   Binding Effect of Decisions. The decision or action of the Plan
      Administrator with respect to any question arising out of or in connection
      with the administration, interpretation and application of the Agreement
      and the rules and regulations promulgated hereunder shall be final and
      conclusive and binding upon all persons having any interest in the
      Agreement.

5.4   Indemnity of Plan Administrator. The Company shall indemnify and hold
      harmless the members of the Plan Administrator against any and all claims,
      losses, damages, expenses or liabilities arising from any action or
      failure to act with respect to this Agreement, except in the case of
      willful misconduct by the

<PAGE>

      Plan Administrator or any of its members.

5.5   Company Information. To enable the Plan Administrator to perform its
      functions, the Company shall supply full and timely information to the
      Plan Administrator on all matters relating to the compensation of the
      Executive, the date and circumstances of the retirement, Disability, death
      or Termination of Employment of the Executive, and such other pertinent
      information as the Plan Administrator may reasonably require.

                                   ARTICLE 6
                          CLAIMS AND REVIEW PROCEDURE

6.1   For all claims other than Disability benefits:

      6.l.1 Claims Procedure. Any individual ("Claimant") who has not received
            benefits under this Agreement that he or she believes should be paid
            shall make a claim for such benefits as follows:

            6.1.1.1     Initiation - Written Claim. The Claimant initiates a
                        claim by submitting to the Company a written claim for
                        the benefits.

            6.1.1.2     Timing of Company Response. The Company shall respond to
                        such Claimant within 90 days after receiving the claim.
                        If the Company determines that special circumstances
                        require additional time for processing the claim, the
                        Company can extend the response period by an additional
                        90 days by notifying the Claimant in writing, prior to
                        the end of the initial 90-day period, that an additional
                        period is required. The notice of extension must set
                        forth the special circumstances and the date by which
                        the Company expects to render its decision.

            6.1.1.3     Notice of Decision. If the Company denies part or all of
                        the claim, the Company shall notify the Claimant in
                        writing of such denial. The Company shall write the
                        notification in a manner calculated to be understood by
                        the Claimant. The notification shall set forth

                        (a)   The specific reasons for the denial,

                        (b)   A reference to the specific provisions of this
                              Agreement on which the denial is based,

                        (c)   A description of any additional information or
                              material necessary for the Claimant to perfect the
                              claim and an explanation of why it is needed,

                        (d)   An explanation of this Agreement's review
                              procedures and the time limits applicable to such
                              procedures, and

                        (e)   A statement of the Claimant's right to bring a
                              civil action under ERISA Section 502(a) following
                              an adverse benefit determination on review.

<PAGE>

      6.1.2 Review Procedure. If the Company denies part or all of the claim,
            the Claimant shall have the opportunity for a full and fair review
            by the Company of the denial, as follows:

            6.1.2.4     Initiation - Written Request. To initiate the review,
                        the Claimant, within 60 days after receiving the
                        Company's notice of denial, must file with the Company a
                        written request for review.

            6.1.2.5     Additional Submissions - Information Access. The
                        Claimant shall then have the opportunity to submit
                        written comments, documents, records and other
                        information relating to the claim. The Company shall
                        also provide the Claimant, upon request and free of
                        charge, reasonable access to, and copies of, all
                        documents, records and other information relevant (as
                        defined in applicable ERISA regulations) to the
                        Claimant's claim for benefits.

            6.1.2.6     Considerations on Review. In considering the review, the
                        Company shall take into account all materials and
                        information the Claimant submits relating to the claim,
                        without regard to whether such information was submitted
                        or considered in the initial benefit determination.

            6.1.2.7     Timing of Company Response. The Company shall respond in
                        writing to such Claimant within 60 days after receiving
                        the request for review. If the Company determines that
                        special circumstances require additional time for
                        processing the claim, the Company can extend the
                        response period by an additional 60 days by notifying
                        the Claimant in writing, prior to the end of the initial
                        60-day period, that an additional period is required.
                        The notice of extension must set forth the special
                        circumstances and the date by which the Company expects
                        to render its decision.

            6.1.2.8     Notice of Decision. The Company shall notify the
                        Claimant in writing of its decision on review. The
                        Company shall write the notification in a manner
                        calculated to be understood by the Claimant. The
                        notification shall set forth:

                        (a)   The specific reasons for the denial,

                        (b)   A reference to the specific provisions of this
                              Agreement on which the denial is based,

                        (c)   A statement that the Claimant is entitled to
                              receive, upon request and free of charge,
                              reasonable access to, and copies of, all
                              documents, records and other information relevant
                              (as defined in applicable ERISA regulations) to
                              the Claimant's claim for benefits, and

                        (d)   A statement of the Claimant's right to bring a
                              civil action under ERISA Section 502(a).

6.2   For Disability claims:

<PAGE>

      6.2.1 Claims Procedures. Any individual ("Claimant") who has not received
            benefits under this Agreement that he or she believes should be paid
            shall make a claim for such benefits as follows:

            6.2.1.2     Initiation - Written Claim. The Claimant initiates a
                        claim by submitting to the Company a written claim for
                        the benefits.

            6.2.1.3     Timing of Company Response. The Company shall notify the
                        Claimant in writing or electronically of any adverse
                        determination as set out in this Section.

            6.2.1.4     Notice of Decision. If the Company denies part or all of
                        the claim, the Company shall notify the Claimant in
                        writing of such denial. The Company shall write the
                        notification in a manner calculated to be understood by
                        the Claimant. The notification shall set forth:

                        (a)   The specific reasons for the denial,

                        (b)   A reference to the specific provisions of this
                              Agreement on which the denial is based,

                        (c)   (c) A description of any additional information or
                              material necessary for the Claimant to perfect the
                              claim and an explanation of why it is needed,

                        (d)   An explanation of the Agreement's review
                              procedures and the time limits applicable to such
                              procedures,

                        (e)   A statement of the Claimant's right to bring a
                              civil action under ERISA Section 502(a) following
                              an adverse benefit determination on review,

                        (f)   [See ss.2560.503-l(g)(v) Any internal rule,
                              guideline, protocol, or other similar criterion
                              relied upon in making the adverse determination,
                              or a statement that such a rule, guideline,
                              protocol, or other similar criterion was relied
                              upon in making the adverse determination and that
                              the Claimant can request and receive free of
                              charge a copy of such rule, guideline, protocol or
                              other criterion from the Company, and

                        (g)   If the adverse benefit determination is based on a
                              medical necessity or experimental treatment or
                              similar exclusion or limit, either an explanation
                              of the scientific or clinical judgment for the
                              determination, applying the terns of this
                              Agreement to the Claimant's medical circumstances,
                              or a statement that such explanation will be
                              provided free of charge upon request.

           6.2.1.5      Timing of Notice of Denial/Extensions. The Company shall
                        notify the Claimant of denial of benefits in writing or
                        electronically not later than 45 days after receipt of
                        the claim by the Company. The Company may elect to
                        extend notification by two 30-day periods subject to the
                        following requirements:

<PAGE>

                        (a)   For the first 30-day extension, the Company shall
                              notify the Claimant (1) of the necessity of the
                              extension and the factors beyond the Company's
                              control requiring an extension; (2) prior to the
                              end of the initial 45-day period; and (3) of the
                              date by which the Company expects to render a
                              decision.

                        (b)   If the Company determines that a second 30-day
                              extension is necessary based on factors beyond the
                              Company's control, the Company shall follow the
                              same procedure in (a> above, with the exception
                              that the notification must be provided to the
                              Claimant before the end of the first 30-day
                              extension period.

                        (c)   For any extension provided under this section, the
                              Notice of Extension shall specifically explain the
                              standards upon which entitlement to a benefit is
                              based, the unresolved issues that prevent a
                              decision on the claim, and the additional
                              information needed to resolve those issues. The
                              Claimant shall be afforded 45 days within which to
                              provide the specified information.

      6.2.2 Review Procedures - Denial of Benefits. If the Company denies part
            or all of the claim, the Claimant shall have the opportunity for a
            full and fair review by the Company of the denial, as follows:

            6.2.2.1     Initiation of Appeal. Within 180 days following notice
                        of denial of benefits, the Claimant shall initiate an
                        appeal by submitting a written notice of appeal to
                        Company.

            6.2.2.2     Submissions on Appeal - Information Access. The Claimant
                        shall be allowed to provide written comments, documents,
                        records, and other information relating to the claim for
                        benefits. The Company shall provide to the Claimant,
                        upon request and free of charge, reasonable access to,
                        and copies of, all documents, records, and other
                        information relevant (as defined in applicable ERISA
                        regulations) to the Claimant's claim for benefits.

            6.2.2.3     Additional Company Responsibilities on Appeal. On
                        appeal, the Company shall:

                        (a)   [See ss.2560.503-1(h)(3)(i)-(v)] Take into account
                              all materials and information the Claimant submits
                              relating to the claim, without regard to whether
                              such information was submitted or considered in
                              the initial benefit determination;

                        (b)   Provide for a review that does not afford
                              deference to the initial adverse benefit
                              determination and that is conducted by an
                              appropriate named fiduciary of the Company who is
                              neither the individual who made the adverse
                              benefit determination that is the subject of the
                              appeal, nor the

<PAGE>

                              subordinate of such individual;

                        (c)   In deciding an appeal of any adverse benefit
                              determination that is based in whole or in part on
                              a medical judgment, including determinations with
                              regard to whether a particular treatment, drug, or
                              other item is experimental, investigational, or
                              not medically necessary or appropriate, consult
                              with a health care professional who has
                              appropriate training and experience in the field
                              of medicine involved in the medical judgment;

                        (d)   Identify medical or vocational experts whose
                              advise was obtained on behalf of the Company in
                              connection with a Claimant's adverse benefit
                              determination, without regard to whether the
                              advice was relied upon in making the benefit
                              determination; and

                        (e)   Ensure that the health care professional engaged
                              for purposes of a consultation under subsection
                              (c) above shall be an individual who was neither
                              an individual who was consulted in connection with
                              the adverse benefit determination that is the
                              subject of the appeal, nor the subordinate of any
                              such individual.

            6.2.2.4     Timing of Notification of Benefit Denial - Appeal
                        Denial. The Company shall notify the Claimant not later
                        than 45 days after receipt of the Claimant's request for
                        review by the Company, unless the Company determines
                        that special circumstances require an extension of time
                        for processing the claim. If the Company determines that
                        an extension is required, written notice of such shall
                        be furnished to the Claimant prior to the termination of
                        the initial 45-day period, and such extension shall not
                        exceed 45 days. The Company shall indicate the special
                        circumstances requiring an extension of time and the
                        date by which the Company expects to render the
                        determination on review.

            6.2.2.5     Content of Notification of Benefit Denial. The Company
                        shall provide the Claimant with a notice calculated to
                        be understood by the Claimant, which shall contain:

                        (a)   The specific reason or reasons for the adverse
                              determination;

                        (b)   Reference to the specific plan provisions on which
                              the benefit determination is based;

                        (c)   A statement that the Claimant is entitled to
                              receive, upon request and free of charge,
                              reasonable access to, and copies of all documents,
                              records, and other relevant information (as
                              defined in applicable ERISA regulations);

                        (d)   A statement of the Claimant's right to bring an
                              action under ERISA Section 502(a);

<PAGE>

                        (e)   [See ss.2560.503-1(j)(5)] Any internal rule,
                              guideline, protocol, or other similar criterion
                              relied upon in making the adverse determination,
                              or a statement that such a rule, guideline,
                              protocol, or other similar criterion was relied
                              upon in making the adverse determination and that
                              the Claimant can request and receive free of
                              charge a copy of such rule, guideline, protocol
                              or other criterion from the Company;

                        (f)   If the adverse benefit determination is based on a
                              medical necessity or experimental treatment or
                              similar exclusion or limit, either an explanation
                              of the scientific or clinical judgment for the
                              determination, applying the terms of this
                              Agreement to the Claimant's medical circumstances,
                              or a statement that such explanation will be
                              provided free of charge upon request; and

                        (g)   The following statement: "You and your Company may
                              have other voluntary alternative dispute
                              resolution options such as mediation. One way to
                              find out what may be available is to contact your
                              local U.S. Department of Labor Office and your
                              state insurance regulatory agency."

                                   ARTICLE 7
                   AMENDMENT AND TERMINATION OF THE AGREEMENT

7.1   Amendment and Termination. Subject to Article 4, prior to the commencement
      of benefit payments under this Agreement, the Company reserves the right
      to amend or terminate this Agreement at any time by the action of the
      Board.

                                   ARTICLE 8
                                 MISCELLANEOUS

8.1   Unsecured General Creditor. The Executive and the Executive's
      Beneficiaries, successors and assigns shall have no legal or equitable
      rights, interests or claims in any property or assets of the Company. Any
      and all of the Company's assets shall be, and remain, the general,
      unpledged unrestricted assets of the Company. The Company's obligation
      under the Agreement shall be merely that of an unfunded and unsecured
      promise to pay money in the future.

8.2   Not a Contract of Employment. The terms and conditions of this Agreement
      shall not be deemed to constitute a contract of employment between the
      Company and the Executive. Such employment is hereby acknowledged to be an
      "at will" employment relationship that can be terminated at any time for
      any reason, with or without cause, unless expressly provided in a written
      employment agreement. Nothing in this Agreement shall be deemed to give a
      Executive the right to be retained in the service of the Company or to
      interfere with the right of the Company to discipline or discharge the
      Executive at any time.

<PAGE>

8.3   Participation in Other Plans. Nothing herein contained shall be construed
      to alter, abridge, or in any manner affect the rights and privileges of
      the Executive to participate in and be covered by any pension, profit
      sharing, group insurance, bonus or similar employee plans which the
      Company may now or hereafter maintain.

8.4   Alienability. Neither the Executive nor any Beneficiary under this
      Agreement shall have any power or right to transfer, assign, anticipate,
      hypothecate, mortgage, commute, modify, or otherwise encumber in advance
      any of the benefits payable hereunder, nor shall any of said benefits be
      subject to seizure for the payment of any debts, judgments, alimony, or
      separate maintenance owed by the Executive or the Executive's Beneficiary
      or any of them, to be transferable by operation of law in the event of
      bankruptcy, insolvency, or otherwise. In the event the Executive or any
      Beneficiary attempts assignment, commutation, hypothecation, transfer, or
      disposal of the benefit hereunder, the Company's liabilities shall
      forthwith cease and terminate.

8.5   Successors. The provisions of this Agreement shall bind and inure to the
      benefit of the Company and its successors and assigns and the Executive
      and the Executive's Beneficiary.

8.6   Reorganization. The Company shall not merge or consolidate into or with
      another corporation, or reorganize, or sell substantially all of its
      assets to another corporation, firm, or person unless and until such
      succeeding or continuing corporation, firm, or person agrees to assume and
      discharge the obligations of the Company under this Agreement. Upon the
      occurrence of such event, the term "Company" as used in this Agreement
      shall be deemed to refer to such succeeding or continuing company, firm,
      or person.

8.7   Interpretation. Wherever the fulfillment of the intent and purpose of this
      Agreement requires, and the context will permit, the use of the masculine
      gender includes the feminine and use of the singular includes the plural.

8.8   Alternative Action. In the event it shall become impossible for the
      Company or the Plan Administrator to perform any act required by this
      Agreement, the Company or Plan Administrator may in its discretion perform
      such alternative act as most nearly carries out the intent and purpose of
      this Agreement and is in the best interests of the Company.

8.9   Applicable Law. Subject to ERISA, the provisions of this Agreement shall
      be construed and interpreted in accordance with the laws of the state of
      Pennsylvania, without regard to its conflict of law principles.

8.10  Headings. Article and section headings are for convenient reference only
      and shall not control or affect the meaning or construction of any of its
      provisions.

<PAGE>

8.11  Furnishing Information. The Executive or the Executive's Beneficiary will
      cooperate with the Plan Administrator by furnishing any and all
      information requested by the Plan Administrator and take such other
      actions as may be requested in order to facilitate the administration of
      the Agreement and the payments of benefits hereunder, including but not
      limited to taking such physical examinations as the Plan Administrator may
      deem necessary.

8.12  Validity. In case any provision of this Agreement shall be illegal or
      invalid for any reason, said illegality or invalidity shall not affect the
      remaining parts hereof, but this Agreement shall be construed and enforced
      as if such illegal and invalid provision has never been inserted herein.

8.13  Notice. Any notice or filing required or permitted to be given to the Plan
      Administrator under this Agreement shall be sufficient if in writing and
      hand- delivered, or sent by registered or certified mail, to the address
      below:

                                198 E. TIOGA ST.
                                TUNKHANNOCK PA.
                                           18657

      Such notice shall be deemed given as of the date of delivery or, if
      delivery is made by mail, as of the date shown on the postmark or the
      receipt for registration or certification.

      Any notice or filing required or permitted to be given to the Executive
      under this Agreement shall be sufficient if in writing and hand-delivered,
      or sent by mail, to the last known address of the Executive.

8.14  Signed Copies. This Agreement may be executed in any number of
      counterparts, each of which shall be deemed to be an original, and such
      counterparts taken together shall constitute one (1) and the same
      instrument.

      IN WITNESS WHEREOF, the Company and the Executive have caused this
Agreement to be duly executed as of the Effective Date above.

EXECUTIVE                               GRANGE NATIONAL BANK


/s/ Thomas A. McCullough                By:
------------------------------             /s/ Sally A. Steele
                                           ---------------------------------

Thomas A. McCullough                            As its Secretary
------------------------

BENEFICIARY DESIGNATION FORM

<PAGE>

I designate the following as beneficiary of benefits under this Agreement
payable following my death:

Primary:
         Helen T. McCullough
        ------------------------------------------------------------------------


--------------------------------------------------------------------------------

Contingent:
         Thomas A. McCullough, Jr., Matthew H. McCullough, Mark M. McCullough,
        ------------------------------------------------------------------------

      John P. McCullough, Luke M. McCullough   each 20%
--------------------------------------------------------------------------------


Note: To name a trust as beneficiary, please provide the name of the trustee(s)
      and the exact name and date of the trust agreement.

I understand that I may change these beneficiary designations by filing a new
written designation with the Plan Administrator. I further understand that the
designations will be automatically revoked if the beneficiary predeceases me,
or, if I have named my spouse as beneficiary and our marriage is subsequently
dissolved.


Signature /s/ Thomas A. McCullough
          ------------------------
            Thomas A. McCullough

Date January 17, 2003

Acknowledged by the Plan Administrator this 11 day of February, 2003


By /s/ [Illegible]
   -------------------------------

Title ____________________________