SHORE BANCSHARES INC
AMENDMENT TO THE EXECUTIVE SUPP RETIREMENT PLAN
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>edg2179ex104.txt
<DESCRIPTION>AMENDMENT TO THE EXECUTIVE SUPP RETIREMENT PLAN
<TEXT>
                                                                    EXHIBIT 10.4
                                    AMENDMENT
 TO THE EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN AGREEMENT DATED JANUARY 1, 1999
             AND THE LIFE INSURANCE ENDORSEMENT METHOD SPLIT DOLLAR
                         AGREEMENT DATED JANUARY 1, 1999

         This  Amendment,  made and entered into this 30 day November,  2000, by
and between The  Centreville  National  Bank of Maryland,  a Bank  organized and
existing under the laws of the State of Maryland,  hereinafter  each referred to
as a, "Bank",  and Daniel T. Cannon,  a Key Employee and  Executive of the Bank,
hereinafter  referred  to as  the,  "Executive",  shall  effectively  amend  the
Executive  Supplemental   Retirement  Plan  Agreement  and  the  Life  Insurance
Endorsement  Method  Split  Dollar  Agreement  both  dated  January  1,  1999 as
specifically set forth herein pursuant to the terms of said agreements.

The agreements shall be amended as follows:

1.)      Subparagraph III (C) Termination of Service, contained in the Executive
         Supplemental  Retirement Agreement shall be deleted in its entirety and
         replaced with the following:

         C. Termination of Service:

         Subject to  Subparagraph  III (E)  hereinafter,  should  the  Executive
         suffer a termination  of service  [defined in  Subparagraph  I (E)], he
         shall be entitled to receive the balance in the Pre-Retirement  Account
         paid over ten (10) years in equal installments commencing at the Normal
         Retirement Age [Subparagraph I (K)]. In addition to these payments, and
         commencing  in the year in  which  the  Executive  attains  his  Normal
         Retirement  Age,  the Index  Retirement  Benefit for each year shall be
         paid to the Executive until his death.

2.)      Subparagraphs  VI (A),  (B), (C) and (D),  Division of Death  Proceeds,
         contained in the Life  Insurance  Endorsement  Method Split Dollar Plan
         Agreement  shall be  deleted  in its  entirety  and  replaced  with the
         following:

         A.        Upon   the   death   of   the    Insured,    the    Insured's
                   beneficiary(ies),  designated  in accordance  with  Paragraph
                   III,  shall be entitled to an amount equal to eighty  percent
                   (80%) of the net-at-risk  insurance  portion of the proceeds.
                   The net-at-risk  insurance portion is the total proceeds less
                   the cash value of the policy.

         B.        The Bank shall be entitled to the remainder of such proceeds.

         C.        The Bank and the  Insured (or  assignees)  shall share in any
                   interest due on the death proceeds on a pro rata basis as the
                   proceeds due each  respectively  bears to the total proceeds,
                   excluding any such interest.

         This Amendment shall be effective the 30 day of November, 2000, and the
Subparagraph  III (C) referred to hereinabove  shall supercede  Subparagraph III
(C) of the  January 1, 1999  Executive  Supplemental  Retirement  Agreement  and
Subparagraphs  VI (A),  (B), and (C)  referred to  hereinabove  shall  supercede
Subparagraphs  VI (A),  (B).  (C) and (D) of the January 1, 1999 Life  Insurance
Endorsement  Method  Split Dollar Plan  Agreement.  To the extent that any term,
provision, or paragraph of said agreement is not specifically amended herein, or
in any other amendment

<PAGE>


thereto,  said term,  provision,  or  paragraph  shall  remain in full force and
effect as set forth in said January 1, 1999 agreement.

         IN  WITNESS  WHEREOF,  the  parties  hereto  acknowledge  that each has
carefully read this Amendment and executed the original thereof on the 30 day of
November, 2000, and that, upon execution, each has received a conforming copy.


                                            THE CENTREVILLE NATIONAL BANK
                                            OF MARYLAND
                                            CENTREVILLE, MARYLAND




                                       By:/s/ B. Vance Carmean, Jr.
-------------------------------           --------------------------------------
Witness                                   B. Vance Carmean, Jr., Chairman


                                          /s/ Daniel T. Cannon
-------------------------------           --------------------------------------
Witness                                   Daniel T. Cannon, Participant




<PAGE>



                     EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN

                                    AGREEMENT

         This Agreement, made and entered into this 1st day of January, 1999, by
and between The  Centreville  National  Bank of Maryland,  a Bank  organized and
existing under the laws of the State of Maryland, hereinafter referred to as the
"Bank",  and  Daniel  Cannon,  a Key  Employee  and the  Executive  of the Bank,
hereinafter referred to as the "Executive".

         The Executive has been in the employ of the Bank for  twenty-nine  (29)
years and has now and for  years  past  faithfully  served  the Bank.  It is the
consensus of the Board of Directors of the bank (the Board) that the Executive's
services have been of exceptional  merit, in excess of the compensation paid and
an invaluable  contribution to the profits and position of the Bank in its field
of  activity.  The  Board  further  believes  that the  Executive's  experience,
knowledge of corporate  affairs,  reputation  and industry  contacts are of such
value and his  continued  services are so essential to the Bank's  future growth
and profits  that it would suffer  severe  financial  loss should the  Executive
terminate his services.

         Accordingly,  it is the desire of the Bank and the  Executive  to enter
into this Agreement under which the Bank will agree to make certain  payments to
the Executive upon his retirement and, alternatively, to his beneficiary(ies) in
the event of his premature death while employed by the Bank.

         It is  the  intent  of  the  parties  hereto  that  this  Agreement  be
considered  an  arrangement   maintained   primarily  to  provide   supplemental
retirement  benefits  for the  Executive,  as a  member  of a  select  group  of
management or  highly-compensated  employees of the Bank, and to be considered a
non-qualified  benefit plan for purposes of the Employee Retirement Security Act
of 1974 (ERISA).  The Executive is fully advised of the Bank's  financial status
and has had substantial input in the design and operation of this benefit plan.

         Therefore,  in consideration of the Executive's  services  performed in
the past and those to be  performed  in the  future  and based  upon the  mutual
promises and covenants herein  contained,  the Bank and the Executive,  agree as
follows:

I.      DEFINITIONS

        A.   Effective Date:

             The effective date of this Agreement shall be January 1, 1999.

        B.   Plan Year:

             Any  reference  to "Plan  Year"  shall  mean a  calendar  year from
             January 1 to December 31. In the year of  implementation,  the term
             "Plan  Year"  shall  mean the  period  from the  effective  date to
             December 31 of the year of the effective date.

        C.   Retirement Date:

             Retirement  Date shall mean  retirement  from service with the Bank
             which  becomes  effective  on the first day of the  calendar  month
             following the month in which the Executive  reaches his sixty-fifth
             (65th)  birthday or such later date as the  Executive  may actually
             retire.

         D.  Early Retirement Date:

             Early Retirement Date shall mean a retirement from service which is
             effective  prior  to  the  Normal  Retirement  Date  stated  above,
             provided the Executive has attained age sixty (60).

         E.  Termination of Service:

             Termination of Service shall mean voluntary  resignation of service
             by the Executive Of the Bank's  discharge of the Executive  without
             cause ("cause" defined in Subparagraph III (E) hereinafter),  prior
             to the Normal  Retirement  Age  (described  in  Subparagraph  I (K)
             hereinafter).

         F.  Pre-Retirement Account:

             A  Pre-Retirement  Account  shall  be  established  as a  liability
             reserve  account  on the books of the Bank for the  benefit  of the
             Executive.   Prior  to  termination  of  service,  the  Executive's
             Retirement  (early or otherwise),  such liability  reserve  account
             shall be increased or decreased each year by an amount equal to the
             annual  earnings  or loss  for the  year  determined  by the  Index
             (described in  Subparagraph  I (H)  hereinafter),  less the Cost of
             Funds for that year (described in Subparagraph I (I) hereinafter).

         G.  Index Retirement Benefit:

             The Index  Retirement  Benefit for the Executive for any year shall
             be equal to the excess of the annual  earnings (if any)  determined
             by the  Index  [Subparagraph  I (H)] for that year over the Cost of
             Funds [Subparagraph I (I)] for that year.

         H.  Index:

             The  Index for any year  shall be the  aggregate  annual  after-tax
             income from the life insurance contracts  described  hereinafter as
             defined  by FASB  Technical  Bulletin  85-4.  This  Index  shall be
             applied  as if  such  insurance  contracts  were  purchased  on the
             effective date hereof.

             Insurance Company:        Connecticut Mutual Life Insurance Company
             Policy Form:              Whole Life Policy
             Policy Name:
             Insured's Age and Sex:    45, Male
             Riders:                   None
             Ratings:                  None
             Option:                   N/A
             Face Amount:              $523,305
             Premiums Paid:            $15,000
             Number of Premiums Paid:  Twenty
             Assumed Purchase Date:    November 16, 1994
             Assumed Cash Value
             on 12/31/98:              $62,920.00

             If such contracts of life  insurance are actually  purchased by the
             Bank then the actual  policies as of the dates they were  purchased
             shall  be  used  in  calculations  under  this  Agreement.  If such
             contracts of life  insurance are not purchased or are  subsequently
             surrendered  or lapsed,  then the Bank shall receive  annual policy
             illustrations   that  assume  the  above  described  policies  were
             purchased  from  the  above  named  insurance  company(ies)  on the
             effective date from which the increase in policy value will be used
             to calculate the amount of the Index.

             In either  case,  references  to the life  insurance  contract  are
             merely for  purposes  of  calculating  a  benefit.  The Bank has no
             obligation to purchase such life insurance  and, if purchased,  the
             Executive and his beneficiary(ies) shall have no ownership interest
             in such  policy and shall  always  have no greater  interest in the
             benefits  under this  Agreement  than that of an unsecured  general
             creditor of the Bank.

         I.  Cost of Funds:

             The Cost of Funds for any year  shall be  calculated  by taking the
             sum of the amount of  premiums  set forth in the  Indexed  policies
             described  above plus the amount of any after tax benefits  paid to
             the   Executive   pursuant  to  this   Agreement   (Paragraph   III
             hereinafter)  plus the amount of all previous years  after-tax Cost
             of Funds, and multiplying that sum by the average after-tax Cost of
             Funds of the Bank's third  quarter Call Report for the Plan Year as
             filed with the Office of the Comptroller of the Currency.

         J.  Change Of Control:

             Change of Control shall be deemed to be the cumulative  transfer of
             more than fifty  percent (50%) of the voting stock of the Bank from
             the  effective  date of this  Agreement.  For the  purposes of this
             Agreement,  transfers  on  account  of deaths  or gifts,  transfers
             between family members or transfers to a qualified  retirement plan
             maintained  by the Bank  shall  not be  considered  in  determining
             whether there has been a change in control.

         K.  Normal Retirement Age:

             Normal  Retirement  Age shall mean the date on which the  Executive
             attains age sixty-five (65).

II.      EMPLOYMENT

         No provision of this Agreement shall be deemed to restrict or limit any
         existing  employment   agreement  by  and  between  the  Bank  and  the
         Executive,  nor shall any conditions herein create specific  employment
         rights  to the  Executive  nor  limit  the  right  of the  Employer  to
         discharge the Executive with or without cause. In a similar fashion, no
         provision shall limit the Executive's  rights to voluntarily  sever his
         employment at any time.

III.     INDEX BENEFITS

         The following benefits provided by the Bank to the Executive are in the
         nature of a fringe benefit and shall in no event be construed to effect
         nor limit the Executive's current or prospective salary increases, cash
         bonuses or profit-sharing distributions or credits.

         A.   Retirement Benefits:

              Should the Executive continue to be employed by the Bank until the
              "Normal Retirement Age" defined in Subparagraph I (K), he shall be
              entitled to receive the balance in his Pre-Retirement  Account [as
              defined  in   Subparagraph   I  (F)]  in  ten  (10)  equal  annual
              installments commencing thirty (30) days following the Executive's
              retirement.  In addition to the these payments,  and commencing in
              the year in which the  Executive  retires,  the  Index  Retirement
              Benefit  (as  defined in  Subparagraph  I (G) above) for each year
              shall be paid to the Executive until his death.

         B.   Early Retirement:

              Should the  Executive  elect  Early  Retirement  or be  discharged
              without cause by the Bank subsequent to the Early  Retirement Date
              [defined in  Subparagraph  I (D)], he shall be entitled to receive
              the balance in the Pre-Retirement Account paid over ten (10) years
              in equal  installments  commencing  at the Normal  Retirement  Age
              [Subparagraph  I  (K)].  In  addition  to  these   payments,   and
              commencing in the year in which the  Executive  attains his Normal
              Retirement Age, the Index  Retirement  Benefit for each year shall
              be paid to the Executive until his death.

         C.   Termination of Service:

              Subject to Subparagraph III (E) hereinafter,  should the Executive
              suffer a termination of service  [defined in  Subparagraph I (E)],
              he shall be entitled to receive ten percent (10%) times the number
              of full years of service with the Bank from the effective  date of
              this  Agreement  (to a maximum of 100%),  times the balance in the
              Pre-Retirement   Account   paid  over  ten  (10)  years  in  equal
              installments commencing at the Normal Retirement Age [Subparagraph
              I (K)]. In addition to these payments,  and commencing in the year
              in which the  Executive  attains his Normal  Retirement  Age,  ten
              percent  (10%) times the number of full years of service  with the
              Bank from the  effective  date of this  Agreement (to a maximum of
              100%),  times the Index Retirement  Benefit for each year shall be
              paid to the Executive until his death.

         D.   Death:

              Should the Executive die prior to having received that portion (If
              the Pre-  Retirement  Account he was  entitled to pursuant to this
              agreement,  as  the  case  may  be,  the  unpaid  balance  of  the
              Pre-Retirement  Account  shall  be  paid  in a  lump  sum  to  the
              beneficiary  selected by the Executive and filed with the Bank. In
              the absence of or a failure to designate a beneficiary, the unpaid
              balance shall be paid in a lump sum to the personal representative
              of the Executive's estate.

         E.   Discharge for Cause:

              Should the  Executive  be  discharged  for cause at any time,  all
              Benefits  under this Agreement  shall be forfeited.  The term "for
              cause"  shall  mean  gross  negligence  or  gross  neglect  or the
              commission  of a felony  or  gross-  misdemeanor  involving  moral
              turpitude) fraud,  dishonesty or willful violation of any law that
              results in any adverse  effect on the bank. If a dispute arises as
              to  discharge  "for  cause",  such  dispute  shall be  resolved by
              arbitration as set forth in this Agreement.

         F.   Death Benefit:

              Except  as set forth  above,  there is no death  benefit  provided
              under this Agreement.

IV.      RESTRICTIONS UPON FUNDING

         The Bank shall have no obligation to set aside,  earmark or entrust any
         fund or money with which to pay its  obligations  under this Agreement.
         The Executive, his beneficiary(ies) or any successor in interest to him
         shall be and remain  simply a general  creditor of the Bank in the same
         manner as any other  creditor  having a general  claim for  matured and
         unpaid compensation.

         The Bank reserves the absolute  right at its sole  discretion to either
         fund the  obligations  undertaken by this  Agreement or to refrain from
         funding the same and to  determine  the exact nature and method of such
         funding.  Should the Bank elect to fund this Agreement,  in whole or in
         part, through the purchase of life insurance,  mutual funds, disability
         policies or  annuities,  the Bank reserves the absolute  right,  in its
         sole discretion,  to terminate such funding at any time, in whole or in
         part.  At no time  shall  the  Executive  be deemed to have any lien or
         right, title or interest in or to any specific funding investment or to
         any assets of the Bank.

         If the Bank elects to invest in a life insurance, disability or annuity
         policy upon the life of the Executive,  then the Executive shall assist
         the Bank by freely  submitting to a physical  exam and  supplying  such
         additional information necessary to obtain such insurance or annuities.

V.       CHANGE OF CONTROL

         Upon a Change of Control (as defined in Subparagraph 1 (J) herein),  if
         the  Executive's  employment  is  subsequently  terminated,  except for
         cause,  then he shall receive the benefits  promised in this  Agreement
         upon attaining  Normal  Retirement Age, as if he had been  continuously
         employed by the Bank until his Normal  Retirement  Age.  The  Executive
         will also  remain  eligible  for all  promised  death  benefits in this
         Agreement.  In addition,  no sale,  merger or consolidation of the Bank
         shall  take  place  unless  the  new  or  surviving   entity  expressly
         acknowledges  the obligations  under this Agreement and agrees to abide
         by its terms.

VI.      MISCELLANEOUS

         A.   Alienability and Assignment Prohibition:

              Neither the Executive,  his widow nor any other  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 his beneficiary, nor 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 benefits
              hereunder,  the  Bank's  liabilities  shall  forthwith  cease  and
              terminate.

         B.   Binding Obligation of Bank and any Successor in Interest:

              The Bank  expressly  agrees that it shall not merge or consolidate
              into or with another bank or sell  substantially all of its assets
              to another  bank,  firm or person until such bank,  firm or person
              expressly agrees,  in writing,  to assume and discharge the duties
              and obligations of the Bank under this  Agreement.  This Agreement
              shall  be  binding  upon the  parties  hereto,  their  successors,
              beneficiary(ies) heirs and personal representatives.

         C.   Revocation:

              It is agreed by and between the parties  hereto  that,  during the
              lifetime  of the  Executive,  this  Agreement  may be  amended  or
              revoked at any time or times,  in whole or in part,  by the mutual
              written assent of the Executive and the Bank.

         D.   Gender:

              Whenever  in this  Agreement  words are used in the  masculine  or
              neuter  gender,  they  shall  be  read  and  construed  as in  the
              masculine,  feminine  or neuter  gender,  whenever  they should so
              apply.

         E.   Effect on Other Bank Benefit Plans:

                  Nothing contained in this Agreement shall affect the right of
              the Executive to participate in or be covered by an y
                  qualified or non-qualified pension, profit-sharing, group,
                  bonus or other supplemental compensation or fringe benefit
                  plan constituting a part of the Bank's existing or future
                  compensation structure.

         F.   Headings:

              Headings  and  subheadings  in this  Agreement  are  inserted  for
              reference and  convenience  only and shall not be deemed a part of
              this Agreement.

         G.   Applicable Law:

              The  validity  and  interpretation  of  this  Agreement  shall  be
              governed by the laws of the State of Maryland.

VII.     ERISA PROVISION

         A.   Named Fiduciary and Plan Administrator:

              The "Named Fiduciary and Plan Administrator" of this plan shall be
              The Centreville  National Bank until its resignation or removal by
              the Board. As Named Fiduciary and Administrator, the Bank shall be
              responsible for the management,  control and administration of the
              Salary  Continuation  Agreement as established  herein.  The Named
              Fiduciary may delegate to others certain aspects of the management
              and  operation   responsibilities   of  the  plan   including  the
              employment of advisors and the delegation of ministerial duties to
              qualified individuals.

         B.   Claims Procedure and Arbitration:

              In the event a dispute  arises over benefits  under this Agreement
              and benefits are not paid to the Executive (or to his  beneficiary
              in the case of the Executive's death) and such claimants feel they
              are entitled to receive such  benefits,  then a written claim must
              be made to the  Named  Fiduciary  and  Administrator  named  above
              within  ninety (90) days from the date  payments are refused.  The
              Named  Fiduciary and  Administrator  and the Bank shall review the
              written  claim  and if the claim is  denied,  in whole or in part,
              they shall provide in writing within ninety (90) day of receipt of
              such claim their  specific  reasons for such denial,  reference to
              the  provisions of this  Agreement  upon which the denial is based
              and any additional  material or  information  necessary to perfect
              the  claim.   Such  written  notice  shall  further  indicate  the
              additional  steps to be taken by claimants if a further  review of
              the claim denial is desired. A claim shall be deemed denied if the
              Named Fiduciary and Administrator  fails to take any action within
              the aforesaid ninety-day period.

              If  claimants  desire a second  review they shall notify the Named
              Fiduciary and  Administrator in writing within ninety (90) days of
              the first claim denial. Claimants may review this Agreement or any
              documents  relating  thereto  and  submit any  written  issues and
              comments they may feel  appropriate.  In its sole discretion,  the
              Named  Fiduciary  and  Administrator  shall then review the second
              claim and provide a written  decision  within  ninety (90) days of
              receipt of such claim.  This  decision  shall  likewise  state the
              specific  reasons for the decision and shall include  reference to
              specific  provisions of this  Agreement upon which the decision is
              based.

              If  claimants  continue to dispute the benefit  denial  based upon
              completed  performance of this Agreement or the meaning and effect
              of the terms and conditions thereof, then claimants may submit the
              dispute  to a Board of  Arbitration  for final  arbitration.  Said
              Board shall consist of one member  selected by the  claimant,  one
              member  selected by the Bank, and the third member selected by the
              first two members.  The Board shall  operate  under any  generally
              recognized set of arbitration rules. The parties hereto agree that
              they and their heirs,  personal  representatives,  successors  and
              assigns  shall be bound by the decision of such Board with respect
              to any controversy properly submitted to it for determination.

              Where a dispute arises as to the Bank's discharge of the Executive
              "for  cause",   such  dispute  shall   likewise  be  submitted  to
              arbitration as above  described and the parties hereto agree to be
              bound by the decision thereunder.

         IN  WITNESS  WHEREOF,  the  parties  hereto  acknowledge  that each has
carefully read this  Agreement and executed the original  thereof on the 1st day
of January, 1999 and that, upon execution, each has received a conforming copy.

                                            THE CENTREVILLE NATIONAL BANK


                                            /s/ B. Vance Carmean, Jr., Chairman
------------------------------------        ------------------------------------
Witness                                                                    Title


                                            /s/ Daniel Cannon
------------------------------------        ------------------------------------
Witness                                     Daniel Cannon




</TEXT>
</DOCUMENT>
