EMPLOYMENT AGREEMENT



     AGREEMENT made as of the 1st day of January 2002, by and

between THE PEOPLES BANK OF OXFORD, a Pennsylvania state-

chartered banking institution having a place of business at 24

South Third Street, Oxford, PA 19363 (the "Employer"), and

HUGH J. GARCHINSKY, an adult individual residing at 106 Hidden

Fox Drive, Lincoln University, PA 19352 (the "Executive").



                             WITNESSETH:



     WHEREAS, the Executive is presently serving as President of

the Employer; and



     WHEREAS, on July 27, 2000, the Employer effected a

reorganization pursuant to which the Employer became a wholly-

owned subsidiary of Peoples First, Inc. ("Peoples First"), a

registered bank holding company; and



     WHEREAS, the Employer desires to continue to employ the

Executive to serve in the capacity of its President and to also

designate the Executive as its Chief Executive Officer effective

January 1, 2002; and



     WHEREAS, the Executive desires to continue his employment

on the terms and conditions set forth herein.



     NOW, THEREFORE, the parties hereto, intending to be legally

bound, agree as follows:



     1.  Employment.  The Employer hereby employs the Executive

as its President and Chief Executive Officer, and the Executive

hereby accepts such employment on the terms and conditions set

forth in this Agreement.



     2.  Duties.  The Executive shall perform and discharge well

and faithfully such duties as are specified for his positions in

the Employer's bylaws and such other duties, consistent with

such position, as may be reasonably assigned to him from time to

time by the Board of Directors (the "Board) of Employer.  The

Executive shall also hold such other senior executive titles and

positions as may be assigned to him, with his concurrence and

the concurrence of the Board, by the board of directors of any

company affiliated with the Employer, including Peoples First.



     3.  Term.  The term of this Agreement shall commence as of

the date hereof and, unless sooner terminated as provided

herein, shall continue until December 31, 2004 (the "Initial

Term"); provided, however, that this Agreement shall

automatically be renewed on January 1, 2003 for the three-year

period ending on December 31, 2005, unless either party delivers

a notice of nonrenewal to the other party on or before

November 2, 2002 (in which case, this Agreement shall continue

in effect, subject to sooner termination as provided herein,

through December 31, 2004); and provided further, that if this

Agreement is renewed on January 1, 2003, it shall automatically

be renewed on January 1 of each subsequent year (an "Annual

Renewal Date") for a period ending three years from each

relevant Annual Renewal Date, unless either party delivers a

notice of nonrenewal to the other party at least 60 days prior

to an Annual Renewal Date (in which case, this Agreement shall

continue in effect, subject to sooner termination as provided

herein, for a term ending two years from the Annual Renewal Date

immediately following such notice).



     4.  Compensation.



          (a)  Salary.  For his services performed hereunder,

the Employer shall initially pay to the Executive a salary at

the annualized rate of $140,000, payable at such times as

salaries are paid to other executive employees of the Employer.

The Employer may, from time to time, increase the Executive's

salary, and any and all such increases shall be deemed to

constitute amendments to this subsection to reflect the

increased amounts, effective as of the dates established for

such increases by the Board (or a committee thereof).



          (b)  Bonus.  During the Initial Term and all renewals

thereof, the Employer will pay to the Executive an annual bonus

in such amount and in such installments as may be determined

from time to time by the Board (or a committee thereof), but in

no event shall any such bonus be less than $10,000 per calendar

year.



          (c)  Additional Benefits.  During the Initial Term and

all renewals thereof, the Executive shall be entitled to

participate in all of the employee benefit plans and other

fringe benefits of the Employer which are applicable to

executive salaried officers, including, without limitation, any

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