Document:

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                                  EXHIBIT 10.1
              DEFERRED COMPENSATION AGREEMENTS WITH BANK DIRECTORS

     SCHEDULE OF DIRECTORS WHO HAVE ENTERED INTO DEFERRED COMPENSATION
ARRANGEMENTS PURSUANT TO A DIRECTOR'S COMPENSATION AGREEMENT WITH FARMERS &
MERCHANTS TRUST COMPANY OF CHAMBERSBURG

<TABLE>
<CAPTION>
                                    Monthly Payment          Monthly Payment
                                    Under 1-1-82             Under 1-1-83
     Director                       Agreement                Agreement
<S>                                <C>                       <C>
     Charles S. Bender II            $1,294                     $  315

     Jay L. Benedict, Jr.               395                         96

     John M. Hull, III                  557                        139

     Jeryl C. Miller                    N/A                      1,310

     Charles Sioberg                  1,078                        812

     Martha B. Walker                 1,366                        N/A

     Robert G. Zullinger                684                        172

</TABLE>

<PAGE>

     FORM OF DIRECTOR'S COMPENSATION AGREEMENT

     1982 VERSION

     This Agreement is entered into this first day of January, 1982, between
FARMERS & MERCHANTS TRUST CO. OF CHAMBERSBURG, P.O. Box T., Chambersburg,
Pennsylvania 17201 (Herein referred to as the "Bank") and
_________________________ (Herein referred to as the "Director").

     WITNESSETH

     WHEREAS, the Bank recognizes that the competent and faithful efforts of
Director on behalf of the Bank have contributed significantly to the success and
growth of the Bank; and

     WHEREAS, the Bank values the efforts, abilities and accomplishments of the
Director and recognizes that his services are vital to its continued growth and
profits in the future; and

     WHEREAS, the Bank desires to compensate the Director and retain his
services for five years, if elected, to serve on the Board of Directors. Such
compensation is set forth below; and

     WHEREAS, the Director, in consideration of the foregoing, agrees to
continue to serve as a Director, if elected,

     NOW, THEREFORE, it is mutually agreed as follows:

     1. Compensation. The Bank agrees to pay Director the total sum of
$__________ payable in monthly installments of $__________ for 120 consecutive
months, commencing on the first day of the month following Director's 65th
birthday. Payments to the Director will terminate when the 120 payments have
been made or at the time of the Director's death, whichever occurs first.

     2. Death of Director Before Age 65. In the event Director should die before
reaching age 65, the Bank agrees to pay to Director's beneficiary designated in
writing to the Bank, the sum of $__________ per month for 120 consecutive
months. Payments will begin on the first day of the month following Director's
death.

     3. Death of Director After Age 65. If the Director dies after age 65 prior
to receiving the full 120 monthly installments, the remaining monthly
installments will be paid to the Director's designated beneficiary(ies). The
beneficiary(ies) shall receive all remaining monthly installments which the
Director would have received until the total sum of $__________ set forth in
paragraph "1" is paid. If the Director fails to designate a beneficiary in
writing to the Bank, the balance of monthly installments remaining at the time
of his death shall be paid to the legal representative of the estate of the
Director.

     4. Termination of Service as A Director. If the Director, for any reason
other than death, fails to serve five consecutive years as a Director, he will
receive monthly compensation beginning at age 65 on the basis that the number of
full months served bears to the required number of 60 months times the
compensation stated in paragraph "1." For example, if the Director serves only
36 months, he will be entitled to 36/60 or 60% of the compensation stated in
paragraph "1."

<PAGE>

     5. Suicide. No payments will be made to the Director's beneficiary(ies) or
to his estate in the event of death by suicide during the first three years of
this Agreement.

     6. Status of Agreement. This Agreement does not constitute a contract of
employment between the parties, nor shall any provision of this Agreement
restrict the right of the Bank's Shareholders to replace the Director or the
right of the Director to terminate his service.

     7. Binding Effect. This Agreement shall be binding upon the parties hereto
and upon the successors and assigns of the Bank, and upon the heirs and legal
representatives of the Director.

     8. Interruption of Service. The service of the Director shall not be deemed
to have been terminated or interrupted due to his absence from active service on
account of illness, disability, during any authorized vacation or during
temporary leaves of absence granted by the Bank for reasons of professional
advancement, education, health or government service, or during military leave
for any period if the Director is elected to serve on the Board following such
interruption.

     9. Forfeiture of Compensation by Competition. The Director agrees that all
rights to compensation following age 65 shall be forfeited by him if he engages
in competition with the Bank, without the prior written consent of the Bank,
within a radius of 50 miles of the main office of the Bank for a period of ten
years, coinciding with the number of years that the Director shall receive such
compensation.

     10. Assignment of Rights. None of the rights to compensation under this
Agreement are assignable by the Director or any beneficiary or designee of the
Director and any attempt to anticipate, sell, transfer, assign, pledge, encumber
or change Director's right to receive compensation, shall be void.

     11. Status of Director's Rights. The rights granted to the Director or any
designee or beneficiary under this Agreement shall be solely those of an
unsecured creditor of the Bank.

     12. Amendments. This Agreement may be amended only by a written Agreement
signed by the parties.

     13. If the Bank shall acquire an insurance policy or any other asset in
connection with the liabilities assumed by it hereunder, it is expressly
understood and agreed that neither Director nor any beneficiary of Director
shall have any right with respect to, or claim against, such policy or other
asset except as expressly provided by the terms of such policy or in the title
to such other asset. Such policy or asset shall not be deemed to be held under
any trust for the benefit of Director or his beneficiaries or to be held in any
way as collateral security for the fulfilling of the obligations of the Bank
under this Agreement except as may be expressly provided by the terms of such
policy or other asset. It shall be, and remain, a general, unpledged,
unrestricted asset of the Bank.

     14. This Agreement shall be construed under and governed by the laws of the
State of Pennsylvania.

     15. Interpretation. Wherever appropriate in this Agreement, words used in
the singular shall include the plural and the masculine shall include the
feminine gender.

     16. Period of Economic Hardship. If, in any year, payments made under this
Agreement would, in the sole judgment of the Board of Directors, create economic
hardship for the Bank's Depositors, the Board of Directors has full authority to
postpone such payments.

<PAGE>

     IN WITNESS HEREOF, the parties have signed this Agreement the day and year
above written.

     FARMERS & MERCHANTS TRUST CO. OF CHAMBERSBURG

     (SEAL)              By________________________________________
     ________________________, President

     _________________________     ____________________________(SEAL)
     Witness                           ____________________, Director

     FORM OF DIRECTOR'S COMPENSATION AGREEMENT

     1983 VERSION

     This Agreement is entered into this first day of January, 1983, between
FARMERS & MERCHANTS TRUST CO. OF CHAMBERSBURG, P.O. Box T., Chambersburg,
Pennsylvania 17201 (Herein referred to as the "Bank") and
_________________________ (Herein referred to as the "Director").

     WITNESSETH

     WHEREAS, the Bank recognizes that the competent and faithful efforts of
Director on behalf of the Bank have contributed significantly to the success and
growth of the Bank; and

     WHEREAS, the Bank values the efforts, abilities and accomplishments of the
Director and recognizes that his services are vital to its continued growth and
profits in the future; and

     WHEREAS, the Bank desires to compensate the Director and retain his
services for five years, if elected, to serve on the Board of Directors. Such
compensation is set forth below; and

     WHEREAS, the Director, in consideration of the foregoing, agrees to
continue to serve as a Director, if elected,

     NOW, THEREFORE, it is mutually agreed as follows:

     1. Compensation. The Bank agrees to pay Director the total sum of
$__________ payable in monthly installments of $__________ for 120 consecutive
months, commencing on the first day of the month following Director's 65th
birthday. Payments to the Director will terminate when the 120 payments have
been made or at the time of the Director's death, whichever occurs first.

<PAGE>

     2. Death of Director Before Age 65. In the event Director should die before
reaching age 65, the Bank agrees to pay to Director's beneficiary designated in
writing to the Bank, the sum of $__________ per month for 120 consecutive
months. Payments will begin on the first day of the month following Director's
death.

     3. Death of Director After Age 65. If the Director dies after age 65 prior
to receiving the full 120 monthly installments, the remaining monthly
installments will be paid to the Director's designated beneficiary(ies). The
beneficiary(ies) shall receive all remaining monthly installments which the
Director would have received until the total sum of $__________ set forth in
paragraph "1" is paid. If the Director fails to designate a beneficiary in
writing to the Bank, the balance of monthly installments remaining at the time
of his death shall be paid to the legal representative of the estate of the
Director.

     4. Termination of Service as A Director. If the Director, for any reason
other than death, fails to serve five consecutive years as a Director, he will
receive monthly compensation beginning at age 65 on the basis that the number of
full months served bears to the required number of 60 months times the
compensation stated in paragraph "1." For example, if the Director serves only
36 months, he will be entitled to 36/60 or 60% of the compensation stated in
paragraph "1."

     5. Suicide. No payments will be made to the Director's beneficiary(ies) or
to his estate in the event of death by suicide during the first three years of
this Agreement.

     6. Status of Agreement. This Agreement does not constitute a contract of
employment between the parties, nor shall any provision of this Agreement
restrict the right of the Bank's Shareholders to replace the Director or the
right of the Director to terminate his service.

     7. Binding Effect. This Agreement shall be binding upon the parties hereto
and upon the successors and assigns of the Bank, and upon the heirs and legal
representatives of the Director.

     8. Interruption of Service. The service of the Director shall not be deemed
to have been terminated or interrupted due to his absence from active service on
account of illness, disability, during any authorized vacation or during
temporary leaves of absence granted by the Bank for reasons of professional
advancement, education, health or government service, or during military leave
for any period if the Director is elected to serve on the Board following such
interruption.

     9. Forfeiture of Compensation by Competition. The Director agrees that all
rights to compensation following age 65 shall be forfeited by him if he engages
in competition with the Bank, without the prior written consent of the Bank,
within a radius of 50 miles of the main office of the Bank for a period of ten
years, coinciding with the number of years that the Director shall receive such
compensation.

     10. Assignment of Rights. None of the rights to compensation under this
Agreement are assignable by the Director or any beneficiary or designee of the
Director and any attempt to anticipate, sell, transfer, assign, pledge, encumber
or change Director's right to receive compensation, shall be void.

     11. Status of Director's Rights. The rights granted to the Director or any
designee or beneficiary under this Agreement shall be solely those of an
unsecured creditor of the Bank.

     12. Amendments. This Agreement may be amended only by a written Agreement
signed by the parties.

<PAGE>

     13. If the Bank shall acquire an insurance policy or any other asset in
connection with the liabilities assumed by it hereunder, it is expressly
understood and agreed that neither Director nor any beneficiary of Director
shall have any right with respect to, or claim against, such policy or other
asset except as expressly provided by the terms of such policy or in the title
to such other asset. Such policy or asset shall not be deemed to be held under
any trust for the benefit of Director or his beneficiaries or to be held in any
way as collateral security for the fulfilling of the obligations of the Bank
under this Agreement except as may be expressly provided by the terms of such
policy or other asset. It shall be, and remain, a general, unpledged,
unrestricted asset of the Bank.

     14. This Agreement shall be construed under and governed by the laws of the
State of Pennsylvania.

     15. Interpretation. Wherever appropriate in this Agreement, words used in
the singular shall include the plural and the masculine shall include the
feminine gender.

     16. Period of Economic Hardship. If, in any year, payments made under this
Agreement would, in the sole judgment of the Board of Directors, create economic
hardship for the Bank's Depositors, the Board of Directors has full authority to
postpone such payments.

     17. All compensation provided by this Agreement is in addition to that
which is provided under the Director's Compensation Agreement dated January 1,
1982.

     IN WITNESS HEREOF, the parties have signed this Agreement the day and year
above written.

     FARMERS & MERCHANTS TRUST CO. OF CHAMBERSBURG

     (SEAL)                        By_____________________________
     ____________________, President

     _________________________      ____________________________(SEAL)
     Witness                            ____________________, Director<PAGE>

                                  EXHIBIT 10.2
                     DIRECTOR'S DEFERRED COMPENSATION PLAN.

     FARMERS AND MERCHANTS TRUST COMPANY OF CHAMBERSBURG

                     DIRECTOR'S DEFERRED COMPENSATION PLAN

          WHEREAS, FARMERS AND MERCHANTS TRUST COMPANY OF CHAMBERSBURG does
intend by the following instrument to establish a Deferred Compensation Plan for
the exclusive benefit of its Directors; and

          WHEREAS, the purpose of the Plan is to provide said individuals with
the opportunity to defer the payment of certain fees due them;

          NOW, THEREFORE, to carry the above intentions into effect, Farmers and
Merchants Trust Company of Chambersburg does enter into this Plan this 1st day
of July, 1986.

                        This Plan shall be known as the:

              FARMERS AND MERCHANTS TRUST COMPANY OF CHAMBERSBURG

                   DIRECTORS' DEFERRED COMPENSATION PLAN

                                   ARTICLE I

                                    PURPOSE

          The Bank recognizes that the members of its Board of Directors possess
an intimate knowledge of the Bank, the community and general business
strategies. It further recognizes that the participation of its Directors is
essential to the Bank's continued growth and success. Accordingly, in order to
retain and attract knowledgeable Directors, the Bank now adopts a plan allowing
its Directors to defer their Director fees until their severance from the Board,
as follows:

                                   ARTICLE II

     2.1 "BANK" means Farmers and Merchants Trust Company of Chambersburg and
any successor thereto.

     2.2 "BENEFICIARY" means the person or persons designated by a Participant
pursuant to Section 5.4.

<PAGE>

     2.3 "DEFERRAL ELECTION FORM" shall mean a written agreement between a
Participant and the Bank, whereby a Participant agrees to defer all or a portion
of his Director Fees to be earned in the future, and the Bank agrees to make
benefit payments in accordance with the provisions of the Plan.

     2.4 "DEFERRED BENEFIT ACCOUNT" means the accounts maintained on the books
of the Bank pursuant to Article IV. A separate Deferred Benefit Account shall be
maintained for each Participant. A Participant's Deferred Benefit Account shall
be utilized solely as a device for the measurement and determination of the
amounts to be paid to the Participants pursuant to the Plan and shall be subject
to Article VI hereof. A Participant's Deferred Benefit Account shall not
constitute or be treated as a trust fund of any kind.

     2.5 "DETERMINATION DATE" means December 31 of each Plan Year and, for each
Participant, the date of death or date of Severance as applicable.

     2.6 "DIRECTOR" means each individual who serves on the Bank's Board of
Directors and, except for the Chairman of the Board of the Bank, is not
otherwise employed by the Bank.

     2.7 "DIRECTOR FEES" means the compensation to a Director, as a Director,
including but not limited to meeting or retainer fees.

     2.8 "EFFECTIVE DATE" means July 1, 1986.

     2.9 "PARTICIPANT" means each active Director who has deferred all or a
portion of his Director Fees in accordance with Article III and any former
Director who remains entitled to a benefit pursuant to Article V.

     2.10 "PLAN" means the Farmers and Merchants Trust Company of Chambersburg
Directors' Deferred Compensation Plan as described in this instrument, and as
amended from time to time.

     2.11 "PLAN INTEREST YIELD" means the average for the Plan Year or part
thereof preceding the Determination Date of the interest rate available on One
Year U. S. Treasury Bills.

     2.12 "PLAN YEAR" initially means the period beginning on July 1, 1986,
and ending December 31, 1986. Thereafter, Plan Year means the 12 consecutive
month period beginning on January 1 and ending on December 31.

     2.13 "SEVERANCE" means voluntary or involuntary termination of Board
membership for any reasons other than death, specifically excepting however a
Termination For Cause.

     2.14 "TERMINATION FOR CAUSE" means termination from the Bank's Board
of Directors as a result of willful misconduct or gross negligence in the
performance by the Director of his duties as a Director.

                                 ARTICLE III

     3.1 Each Director who elects to defer all or a specified portion of
Directors Fees pursuant to the terms provided herein shall execute a Deferral
Election Form prior to the Plan Year for which the deferral shall first occur.

<PAGE>

          3.2 Each Director appointed to the Board during the course of a Plan
Year may file a Deferral Election Form with respect to Director Fees to be
earned in the future including those earned throughout the balance of such Plan
Year.

          3.3 An election to defer Director Fees pursuant to the Plan is
irrevocable and shall continue until the earlier of a Participant's death,
Severance or Termination For Cause. Notwithstanding, a Participant may change
the deferred portion of his Director Fees or suspend deferrals effective for any
subsequent Plan Year by executing a new Deferral Election Form prior to the
first day of the Plan Year such change is to be effective.

                                   ARTICLE IV

                            DEFERRED BENEFIT ACCOUNT

          4.1 For recordkeeping purposes only, the Bank shall maintain separate
Deferred Benefit Accounts for each Participant. The existence of these accounts
shall not require any segregation of assets.

          4.2 The amount of Director Fees that a Participant elects to defer
shall be credited to the Participant's Deferred Benefit Account throughout each
Plan Year at such time as the Participant would otherwise be entitled to the
Director Fees which are the source of the deferral.

          4.3 On each Determination Date, the Bank shall credit each Deferred
Benefit Account, an additional amount equal to the Plan Interest Yield.

                                    ARTICLE V

                                    BENEFITS

          5.1 Within sixty (60) days of a Participant's Termination For Cause,
the Bank shall pay to the Participant a lump sum cash distribution, in lieu of
any other benefit provided hereunder, equal to the Participant's accumulated
deferrals, without interest.

          5.2 Within sixty (60) days of a Participant's Severance or death, the
Bank shall pay to the Participant, or in the event of a Participant's death to
the Participant's Beneficiary, a deferred benefit. The amount of the deferred
benefit shall be equal to Participant's Deferred Benefit Account, determined
pursuant to Article IV.

          5.3 The Participant's deferred benefit shall be payable as a lump sum,
unless, prior to the calendar year of Severance or death, the Participant elects
to have his deferred benefit payable over an optional payment period of five
years. If the Participant shall elect against a lump-sum distribution, the Bank
shall annuitize his deferred benefit, utilizing the average of the Plan Interest
Yield during the three calendar years immediately preceding the Participant's
Severance or death, and pay such annuitized benefit to the Participant, or if
applicable, his Beneficiary, in equal annual installments.

          5.4 The Participant may designate a Beneficiary by filing a written
notice of such designation with the Bank in such form as the Bank requires and
may include contingent beneficiaries. The Participant may from time to time
change the designated Beneficiary or Beneficiaries without the consent of such
Beneficiary by filing a new

<PAGE>

designation in writing with the Bank. (If a Participant maintains his primary
residence in a state which has community property laws, the spouse of a married
Participant shall join in any designation of a Beneficiary or Beneficiaries
other than the spouse.) If no designation shall be in effect at the time when
any benefits payable under this Plan shall become due, the Beneficiary shall be
the spouse of the Participant, or if no spouse is then living, the
representatives of the Participant's estate.

          5.5 To the extent required by the law in effect at the time payments
are made, the Bank shall withhold any taxes required by the federal or any state
or local government from payments made hereunder.

                                 ARTICLE VI

                                UNFUNDED PLAN

          6.1 Benefits are payable as they become due irrespective of any actual
investments the Bank may make to meet its obligations. The Bank is under no
obligation to purchase or maintain any asset, and any reference to investments
is solely for the purpose of computing the value of benefits. Neither this Plan
nor any action taken pursuant to the provisions of this Plan shall create or be
considered to create a trust of any kind, or a fiduciary relationship between
the Bank and the Participant, or any other person. To the extent a Participant
or any other person acquires a right to receive payments from the Bank under
this Plan, such right shall be no greater than the right of any unsecured
creditor of Bank.

                                   ARTICLE VII

                                   ASSIGNMENT

          7.1 No Participant, Beneficiary or heir shall have any right to
commute, sell, transfer, assign or otherwise convey the right to receive any
payment under the terms of this Plan. Any such attempted assignment shall be
considered null and void.

                                 ARTICLE VIII

                           AMENDMENT AND TERMINATION

          8.1 The Plan may be amended in whole or in part by the Bank at any
time. Notice of any such amendment shall be given in writing to each Participant
and each Beneficiary of a deceased Participant.

          8.2 Subject to Section 8.3, no amendment hereto shall permit amounts
accumulated pursuant to the Plan prior to the amendment to be paid to a
Participant or Beneficiary prior to the time he would otherwise be entitled
thereto.

          8.3 The Bank reserves the sole right to terminate the Plan (and/or the
Deferral Election Form pertaining to any Participant) at any time prior to the
commencement of payment of benefits, but only in the event that the Bank, in its
sole discretion, shall determine that the economics of the Plan have been
adversely and materially affected by a change in tax laws, other government
action or other event beyond the control of the Participants and the Bank. In
the event of any such termination, each affected Participant shall be entitled
to a deferred benefit equal to the

<PAGE>

amount of his Deferred Benefit Account determined under Article IV, using the
Plan Interest Yield as of the date of termination of the Plan (and/or his
Deferral Election Form).

                                  ARTICLE IX

                                 MISCELLANEOUS

          9.1 The benefits provided for the Participants under this Plan are in
addition to benefits provided by any other plan or program of the Bank and,
except as otherwise expressly provided for herein, the benefits of this Plan
shall supplement and shall not supersede any plan or agreement between the Bank
and any Participant or any provisions contained herein.

          9.2 The Plan shall be governed and construed under the laws of the
Commonwealth of Pennsylvania as in effect at the time of its adoption.

          9.3 The courts of the Commonwealth of Pennsylvania shall have
exclusive jurisdiction in any or all actions arising under this Plan.

          9.4 The terms of this Plan shall be binding upon and inure to the
benefit of the parties hereto, their respective heirs, executors, administrators
and successors.

          9.5 The interest of any Participant or any Beneficiary receiving
payments hereunder shall not be subject to anticipation, nor to voluntary or
involuntary alienation until distribution is actually made.

          9.6 All headings preceding the text of the several Articles hereof are
inserted solely for reference and shall not constitute a part of this Plan, nor
affect its meaning, construction or effect.

          9.7 Where the context admits, words in the masculine gender shall
include the feminine and neuter genders.

                                   FARMERS AND MERCHANTS TRUST COMPANY
                                   OF CHAMBERSBURG

     Date:  ________, 20____         By:________________________________

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