Exhibit 10.1


    EXHIBIT
      10.1

    


    NATIONAL
      PENN BANCSHARES, INC.

    


    LONG-TERM
      INCENTIVE COMPENSATION PLAN

    


    (APPROVED
      BY SHAREHOLDERS, APRIL 25, 2005)

    


    


    STOCK
      OPTION AGREEMENT

    BETWEEN

    NATIONAL
      PENN BANCSHARES, INC.

    


    AND

    


    «Optionee»

    (the
      Optionee)

    


    


    


    
      	 	 
	
              Date
                of Grant:

            	
              December
                1, 2005

            
	 	 
	 	 
	
              Number
                of Shares:

            	
              «NumberofShares»
                shares

            
	 	 
	 	 
	
              Purchase
                Price:

            	
              $_______
                per share

            
	 	 
	 	 
	
              Option
                Expires:

            	
              January
                1, 2016

            
	 	 
	 	 


    

    


    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


     

    NATIONAL
      PENN BANCSHARES, INC.

    LONG-TERM
      INCENTIVE COMPENSATION PLAN

     

    NON-QUALIFIED

    STOCK
      OPTION AGREEMENT

    


    


    This
      Stock Option Agreement dated December 1, 2005, between National Penn Bancshares,
      Inc. (the "Corporation") and «Optionee»
      (the
      "Optionee"),

     

    WITNESSETH:

    


    1. Grant
      of Option

    


    Pursuant
      to the National Penn Bancshares, Inc. Long-Term Incentive Compensation Plan
      (the
      "Plan"), this Agreement confirms the Corporation's grant to the Optionee,
      subject to the terms and conditions of the Plan and subject further to the
      terms
      and conditions herein set forth, of the right and option to purchase from the
      Corporation all or any part of an aggregate of «NumberofShares»
      common
      shares (without par value) of the Corporation at the purchase price of $_____
      per share, such option to be exercised as hereinafter provided.

    


    2. Terms
      and Conditions

    


    It
      is
      understood and agreed that the option evidenced hereby is subject to the
      following terms and conditions:

    


    (a) Expiration
      Date.
      Subject
      to the provisions of Paragraph 2(d), the option evidenced hereby shall expire
      on
      January 1, 2016 [10 years and one month from the date of grant].

    


    (b) Exercise
      of Option.
      The
      Optionee shall have a cumulative vested interest in the right to exercise an
      option granted hereby, determined by reference to his or her continuous
      employment with the Corporation and/or a subsidiary following the date of grant
      of the option, as follows:

    


    
      	
              Period
                of Continuous

            	
              Cumulative
                Vested

            
	
              Employment
                Following Grant

            	
              Percentage

            
	
              Less
                than 1 year

            	
              -0-
                

            
	
              1
                year or more

            	
              20.0

            
	
              2
                years or more

            	
              40.0

            
	
              3
                years or more

            	
              60.0

            
	
              4
                years or more

            	
              80.0

            
	
              5
                years or more

            	
              100.0

            


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    To
      the
      extent the application of the above vesting schedule would at any time result
      in
      the right to acquire a fractional share, the right to acquire such fractional
      share shall be deferred to the next vesting period.

    


    This
      option may be exercised, to the extent exercisable by its terms, in whole or
      from time to time in part at any time prior to the expiration hereof. Any
      exercise shall be accompanied by a written notice to the Corporation specifying
      the number of shares as to which the option is being exercised.

    


    (c) Payment
      of Purchase Price Upon Exercise.
      The
      option exercise price for the shares as to which this option shall be exercised
      shall be paid in cash or as otherwise permitted by the Plan and the
      Committee.

    


    (d) Exercise
      Upon Death, Disability, Retirement or other Termination of
      Employment.

    


    (1) If
      the
      Optionee's employment with the Corporation or a subsidiary terminates due to
      death, Disability (as defined in the Plan) or Retirement (as defined in the
      Plan
      and also including a voluntary termination of employment at age 60 or more),
      or
      if the Company or a subsidiary terminates the Optionee’s employment not for
      Cause (as defined in the Plan), this option (whether or not exercisable by
      the
      Optionee immediately prior to ceasing to be an employee) will be exercisable
      at
      any time prior to the expiration date of this option or within five years after
      the date of termination of employment, whichever is the shorter
      period.

    


    (2) If
      the
      Optionee voluntarily terminates employment not qualifying as Retirement (as
      provided in Paragraph 2(d)(1)) defined in the Plan), this option, if and to
      the
      extent not yet exercisable, will terminate, and if and to the extent then
      exercisable, may be exercised by the Optionee at any time prior to the
      expiration date of this option or within three months after the date of
      termination of employment, whichever is the shorter period.

    


    (3) If
      the
      Corporation or a subsidiary terminates the Optionee’s employment for Cause (as
      defined in the Plan), this Option, including any unexercised vested portion,
      shall immediately lapse and be cancelled. Any lapse occurring under this
      subsection of this Agreement shall be final, and no person or corporation shall
      be liable to the Optionee therefor.

    


    (e) Transferability.
      This
      option shall be transferable by Will or by the laws of descent and distribution.
      During the lifetime of the Optionee, this option may be transferred to the
      extent permitted by, and subject to the conditions imposed by, the Plan and
      the
      Committee.

    


    (f) Adjustment
      and Substitution of Shares.
      If any
      merger, reorganization, consolidation, recapitalization, separation,
      liquidation, stock dividend, split-up, share combination, or other change in
      the
      corporate structure of the Corporation affecting the Corporation’s common shares
      shall occur, the number and class of shares subject to this option and the
      price
      per share thereof (but not the total price) shall be adjusted or substituted
      for, as the case may be, as shall be determined by the Committee to be
      appropriate and equitable to prevent dilution or enlargement of rights, and
      provided that the number of shares shall always be a whole number. Any
      adjustment or substitution so made shall be final and binding upon the
      Optionee.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    (g) No
      Rights as Shareholder.
      The
      Optionee shall have no rights as a shareholder with respect to any common shares
      subject to this option prior to the date of issuance to him or her of a
      certificate or certificates for such shares.

    


    (h) No
      Right To Continued Employment.
      This
      option shall not confer upon the Optionee any right to continue as an employee
      of the Corporation or any subsidiary, nor shall it interfere in any way with
      the
      right of his or her employer to terminate his or her employment at any
      time.

    


    (i) Compliance
      with Law and Regulations.
      This
      option and the obligation of the Corporation to sell and deliver shares
      hereunder shall be subject to all applicable federal and state laws, rules
      and
      regulations and to such approvals by any government or regulatory agency as
      may
      be required. The Corporation shall not be required to issue or deliver any
      certificates for common shares prior to (1) the effectiveness of a registration
      statement under the Securities Act of 1933, as amended, with respect to such
      shares, if deemed necessary or appropriate by counsel for the Corporation,
      (2)
      the listing of such shares on any stock exchange on which the common shares
      may
      then be listed, or upon the Nasdaq Stock Market if the common shares are then
      listed thereon, and (3) compliance with all other applicable laws, regulations,
      rules and orders which may then be in effect.

    


    (j) Change-in-Control.
      If any
      "Change-in-Control" (as defined in the Plan) occurs, this option shall become
      immediately and fully exercisable whether or not otherwise then
      exercisable.

    


    3. Investment
      Representation

    


    The
      Committee may require the Optionee to furnish to the Corporation, prior to
      the
      issuance of any shares upon the exercise of all or any part of this option,
      an
      agreement (in such form as such Committee may specify) in which the Optionee
      represents that the shares acquired by him or her upon exercise are being
      acquired for investment and not with a view to the sale or distribution
      thereof.

    


    4. Optionee
      Bound by Plan

    


    The
      Optionee hereby acknowledges receipt of a copy of the Plan and agrees to be
      bound by all the terms and provisions of the Plan, as in effect on the date
      hereof and as it may be amended from time to time in accordance with its terms,
      all of which terms and provisions are incorporated herein by reference. If
      there
      shall be any inconsistency between the terms and provisions of the Plan, as
      in
      effect from time to time, and those of this Agreement, the terms and provisions
      of the Plan, as in effect from time to time, shall control.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

        

         
5.
        Committee

       

    

    All
      references herein to the “Committee” mean the Compensation Committee of the
      Board of Directors of the Corporation (or any successor committee designated
      by
      the Board of Directors to administer the Plan).

    


    6. Withholding
      of Taxes

    


    The
      Corporation will require as a condition precedent to the exercise of this option
      that appropriate arrangements be made for the withholding of any applicable
      Federal, state and local taxes.

    


    7. Notices

    


    Any
      notice hereunder to the Corporation shall be addressed to it at its office,
      Philadelphia and Reading Avenues, Boyertown, Pennsylvania 19512, Attention:
      Corporate Secretary, and any notice hereunder to Optionee shall be addressed
      to
      him or her at the address below, subject to the right of either party to
      designate at any time hereafter in writing some other address.

    


    IN
      WITNESS WHEREOF, National Penn Bancshares, Inc. has caused this Agreement to
      be
      executed by a duly authorized officer and the Optionee has executed this
      Agreement, both as of the day and year first above written.

    


    
      	 	
              NATIONAL
                PENN BANCSHARES, INC.

            	
              OPTIONEE

            
	 	 	 
	 	 	 
	 	
              By:
                ______________________________

            	 ______________________________
	 	
              WAYNE
                R. WEIDNER

            	
              (Signature)

            
	 	
              Chairman
                & CEO

            	 
	 	 	 ______________________________
	 	 	
              (Print
                Name)

            
	 	 	 
	 	 	 ______________________________
	 	 	
              (Print
                Address)