SUSQUEHANNA BANCSHARES INC
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
<DOCUMENT>
<TYPE>EX-10.IV
<SEQUENCE>4
<FILENAME>dex10iv.txt
<DESCRIPTION>SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
<TEXT>
<PAGE>


                                                                  Exhibit 10(iv)
                                                                  --------------

              Susquehanna's Supplemental Executive Retirement Plan
               as amended and restated effective January 1, 1998

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                          SUSQUEHANNA BANCSHARES, INC.
                     SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

                            (As Amended and Restated
                           Effective January 1, 1998)

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                                Table of Contents
<TABLE>
<CAPTION>
                                                                                                    Page
                                                                                                    ----
<S>                                                                                                   <C>
Article I.  Definitions...............................................................................2
         Section 1.01  Accrued Benefit................................................................2
         Section 1.02  Actuarial Equivalent...........................................................2
         Section 1.03  Annuity Starting Date..........................................................2
         Section 1.04  Beneficiary....................................................................2
         Section 1.05  Board..........................................................................2
         Section 1.06  Code...........................................................................2
         Section 1.07  Committee......................................................................2
         Section 1.08  Deferred Retirement Benefit....................................................2
         Section 1.09  Early Retirement Date..........................................................3
         Section 1.10  Effective Date.................................................................3
         Section 1.11  Employee.......................................................................3
         Section 1.12  Employer.......................................................................3
         Section 1.13  ERISA..........................................................................3
         Section 1.14  Normal Retirement Age..........................................................3
         Section 1.15  Normal Retirement Date.........................................................3
         Section 1.16  Participant....................................................................3
         Section 1.17  Participating Employer.........................................................3
         Section 1.18  Plan...........................................................................4
         Section 1.19  Plan Year......................................................................4
         Section 1.20  Qualified Plan.................................................................4
         Section 1.21  Qualified Plan Accrued Benefit.................................................4
         Section 1.22  Sponsor........................................................................4
         Section 1.23  Year of Service................................................................4

Article II.  Participation............................................................................5
         Section 2.01  Participation..................................................................5

Article III.  Benefits................................................................................6
         Section 3.01  Normal Retirement Benefit......................................................6
         Section 3.02  Deferred Retirement Benefit....................................................6
         Section 3.03  Early Retirement Benefit.......................................................6
         Section 3.04  Death Benefit..................................................................6
         Section 3.05  Deferred Vested Benefit........................................................6

Article IV.  Vesting..................................................................................8
         Section 4.01  Vesting - Years of Service or Normal Retirement Age............................8
         Section 4.02  Forfeiture.....................................................................8
</TABLE>

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<TABLE>
<S>                                                                                                  <C>
Article V.  Payment of Benefits.......................................................................9
         Section 5.01  Retirement.....................................................................9
         Section 5.02  Deferred Vested Benefit........................................................9
         Section 5.03  Death Benefit..................................................................9
         Section 5.04  Small Benefits.................................................................9

Article VI.  Administration..........................................................................10
         Section 6.01  Administration................................................................10
         Section 6.02  Claims for Benefits...........................................................10
         Section 6.03  Review of Claims..............................................................10

Article VII.  Miscellaneous..........................................................................11
         Section 7.01  No Contract of Employment.....................................................11
         Section 7.02  Funding.......................................................................11
         Section 7.03  Liability of Employer.........................................................11
         Section 7.04  Termination of Participation by Participating Employer........................11
         Section 7.05  Notices, Data.................................................................12
         Section 7.06  Choice of Law.................................................................12
         Section 7.07  Binding Effect................................................................12
         Section 7.08  Non-alienation................................................................12
         Section 7.09  Incapacity....................................................................12
         Section 7.10  Amendment or Termination......................................................13
         Section 7.11  Other Plans...................................................................13
         Section 7.12  Integrated Agreement..........................................................13
         Section 7.13  Severability..................................................................13
         Section 7.14  Withholding...................................................................13
         Section 7.15  Construction..................................................................13
</TABLE>

<PAGE>

                                    PREAMBLE

     Susquehanna Bancshares, Inc. (the "Employer") amends and restates the
Susquehanna Bancshares, Inc. Supplemental Executive Retirement Plan (the
"Plan"), effective January 1, 1998, to provide retirement benefits to selected
executives that these executives are not permitted to receive from the
Susquehanna Bancshares, Inc. Cash Balance Pension Plan on account of the
limitations of sections 401(a)(17) and 415 of the Internal Revenue Code of 1986,
as amended (the "Code"), and to recognize their service with the Employer. This
Plan is intended to constitute an unfunded plan for the benefit of a select
group of management or highly compensated employees within the meaning of
sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA").

<PAGE>

                           Article I. Definitions

Section 1.01    Accrued Benefit.

                The benefit to which a Participant is entitled under Section
                3.01, expressed in the form of a single life annuity beginning
                at the Participant's Normal Retirement Date.

Section 1.02    Actuarial Equivalent.

                A benefit of equivalent value as determined using the
                actuarial assumptions set forth in the Qualified Plan.

Section 1.03    Annuity Starting Date.

                For a benefit payable in the form of an annuity, the first day
                of the first period for which a benefit is payable, or, for
                any other form of benefit, the first day on which all events
                have occurred which entitle the Participant to such benefit.

Section 1.04    Beneficiary.

                The person or persons who are the Participant's Beneficiary
                under the Qualified Plan in the same proportion as determined
                under the Qualified Plan.

Section 1.05    Board.

                The Board of Directors of the Sponsor, or the committee of the
                Board of Directors of the Sponsor to which responsibility for
                this Plan has been delegated.

Section 1.06    Code.

                The Internal Revenue Code of 1986, as amended.

Section 1.07    Committee.

                The individual or committee appointed by the Board to
                administer the Plan.

Section 1.08    Deferred Retirement Benefit.

                The benefit referred to in Section 3.02.

                                       2

<PAGE>

Section 1.09    Early Retirement Date.

                The first day of any month coincident with or following the
                Participant's attainment of age 55 and completion of 15 Years
                of Service, but before his Normal Retirement Date, provided
                the Participant terminates employment with the Employer.

Section 1.10    Effective Date.

                This Plan was originally effective January 1, 1994. This
                amendment and restatement is effective January 1, 1998.

Section 1.11    Employee.

                An individual employed by the Employer in an executive
                capacity.

Section 1.12    Employer.

                The Sponsor, and (a) any other corporation that is a member of
                a controlled group of corporations, as defined in section
                414(b) of the Code, that includes the Sponsor, (b) any other
                trade or business that is a member of a controlled group of
                trades or business, as defined in section 414(c) of the Code,
                that includes the Sponsor, and (c) any other entity that is
                required to be aggregated with the Sponsor under section
                414(m) or 414(o) of the Code.

Section 1.13    ERISA.

                The Employee Retirement Income Security Act of 1974, as amended.

Section 1.14    Normal Retirement Age.

                The date a Participant reaches age 65 or, if later, the fifth
                anniversary of his participation in the Qualified Plan.

Section 1.15    Normal Retirement Date.

                The first day of the month coincident with or following the
                date the Participant reaches Normal Retirement Age.

Section 1.16    Participant.

                An Employee who satisfies the requirements for participation
                and becomes a Participant as described in Article II.

                                       3

<PAGE>

Section 1.17    Participating Employer.

                The Sponsor and each other Employer that has adopted the Plan
                with the approval of the Board.

Section 1.18    Plan.

                The Susquehanna Bancshares, Inc. Supplemental Executive
                Retirement Plan, as amended from time to time.

Section 1.19    Plan Year.

                The calendar year. The first Plan Year began on the Effective
                Date.

Section 1.20    Qualified Plan.

                Effective January 1, 1998, "Qualified Plan" means the
                Susquehanna Bancshares, Inc. Cash Balance Pension Plan, as
                amended and restated effective January 1, 1998, as further
                amended from time to time. From January 1, 1994, through
                December 31, 1997, "Qualified Plan" meant the Susquehanna
                Bancshares, Inc. Retirement Income Plan.

Section 1.21    Qualified Plan Accrued Benefit.

                The Participant's Accrued Benefit under the Qualified Plan,
                expressed in terms of a single life annuity beginning at the
                Participant's Normal Retirement Date.

Section 1.22    Sponsor.

                Susquehanna Bancshares, Inc., a Pennsylvania corporation, and
                any successor.

Section 1.23    Year of Service.

                A Year of Service as defined in the Qualified Plan.

                                       4

<PAGE>

                            Article II. Participation
                            -------------------------

Section 2.01    Participation.

                An Employee shall become a Participant in the Plan upon his
                designation and approval by the Board. A list of Employees who
                have been designated as Participants is attached as Appendix
                A. An Employee shall remain a Participant until the earlier of
                the date he terminates employment or the date the Board
                determines that he shall no longer be a Participant. A former
                Participant shall nevertheless be entitled to receive any
                benefits in which he is vested as described in Section 4.01 in
                accordance with Article V.

                                       5

<PAGE>

                              Article III. Benefits
                              ---------------------

Section 3.01    Normal Retirement Benefit.

                On retirement at his Normal Retirement Date, a Participant
                shall be entitled to the Actuarial Equivalent of an Accrued
                Benefit equal to the difference between (a) his Qualified Plan
                Accrued Benefit as of his Normal Retirement Date, determined
                without reference to the limitations contained in sections
                401(a)(17) and 415 of the Code, and (b) his Qualified Plan
                Accrued Benefit at his Normal Retirement Date. Notwithstanding
                the preceding sentence, the amount of a Participant's Accrued
                Benefit shall be adjusted as agreed to by the Participant and
                the Participating Employer.

Section 3.02    Deferred Retirement Benefit.

                If a Participant continues in employment following his Normal
                Retirement Date, he shall be entitled to the Actuarial
                Equivalent of a Deferred Retirement Benefit as of his Annuity
                Starting Date calculated as of the date of his termination of
                employment. The Deferred Retirement Benefit shall be computed
                in the same manner as the Normal Retirement Benefit under
                Section 3.01.

Section 3.03    Early Retirement Benefit.

                A Participant who retires on an Early Retirement Date shall be
                entitled to the Actuarial Equivalent of an Accrued Benefit
                payable at his Normal Retirement Date determined in accordance
                with Section 3.01 as of the date of his termination of
                employment. If the Participant so elects, his Annuity Starting
                Date may precede his Normal Retirement Date, in which case the
                amount of the payments shall be adjusted to the Actuarial
                Equivalent amount.

Section 3.04    Death Benefit.

                If a married Participant who is vested in his Accrued Benefit
                dies before his Annuity Starting Date, his spouse shall be
                entitled to the Actuarial Equivalent of the Participant's
                vested Accrued Benefit under Section 3.01 determined as of the
                Participant's date of death. The death benefit payable to a
                Participant who dies after his Annuity Starting Date shall
                depend on the form of benefit selected.

Section 3.05    Deferred Vested Benefit.

                A Participant who terminates employment after satisfying the
                requirements for vesting under Section 4.01 shall be entitled
                to the Actuarial Equivalent of an

                                       6

<PAGE>

                Accrued Benefit beginning as of his Normal Retirement Date
                determined under Section 3.01 as of the date of his termination
                of employment.

                                       7

<PAGE>

                               Article IV. Vesting
                               -------------------

Section 4.01    Vesting - Years of Service or Normal Retirement Age.

                Except as provided in Section 4.02, a Participant shall be
                fully vested in his Accrued Benefit upon the earlier of (a)
                his attainment of Normal Retirement Age while employed by the
                Employer, or (b) his completion of five Years of Service.

Section 4.02    Forfeiture.

                The Accrued Benefit of a Participant who terminates employment
                before completing five Years of Service or attaining Normal
                Retirement Age shall be forfeited. In addition, the Accrued
                Benefit of a Participant who is unmarried and dies before his
                Annuity Starting Date shall be forfeited.

                                       8

<PAGE>

                         Article V. Payment of Benefits
                         ------------------------------

Section 5.01    Retirement.

                Subject to Section 5.04, the Accrued Benefit of a Participant
                who retires at an Early Retirement Date, his Normal Retirement
                Date, or a Deferred Retirement Date shall be paid or shall
                begin to be paid at the same time and in the same form as
                payment of the Participant's Qualified Plan Accrued Benefit,
                to the extent administratively practicable.

Section 5.02    Deferred Vested Benefit.

                Subject to Section 5.04, the vested Accrued Benefit of a
                Participant who terminates employment before his Early or
                Normal Retirement Date shall be paid or shall begin to be paid
                at the same time and in the same form as payment of the
                Participant's Qualified Plan Accrued Benefit, to the extent
                administratively practicable.

Section 5.03    Death Benefit.

                Subject to Section 5.04, the vested Accrued Benefit of a
                Participant who dies before his Annuity Starting Date shall be
                distributed to his Beneficiary at the same time, and in the
                same form, as the Participant's Qualified Plan Accrued Benefit
                is distributed.

Section 5.04    Small Benefits.

                Notwithstanding anything in this Article V to the contrary, if
                the Actuarial Equivalent lump sum present value of a
                Participant's vested Accrued Benefit is not greater than
                $5,000 as of the date of his termination of employment, that
                Actuarial Equivalent amount shall be distributed to him or his
                Beneficiary, as applicable, in the form of a single lump sum
                as soon as practicable after his termination of employment.

                                       9

<PAGE>

                           Article VI. Administration
                           --------------------------

Section 6.01    Administration.

                The Plan shall be administered by the Committee. The Committee
                shall establish such rules and procedures as it deems
                appropriate for the administration of the Plan. The Committee
                shall have the full power, discretion and authority to
                interpret, construe and administer the terms of the Plan, and
                all decisions made by the Committee shall be final and
                binding. The Committee may employ legal counsel, consultants,
                actuaries and others as it deems desirable in the
                administration of the Plan. The Committee shall have such
                other powers as provided to the plan administrator under the
                Qualified Plan.

Section 6.02    Claims for Benefits.

                A Participant or Beneficiary may bring a claim for benefits
                under this Plan by filing a written application for benefits
                with the Committee. The Committee shall review such claim and
                shall decide such claim within a reasonable time, but not more
                than 90 days from the date the claim was received, unless
                special circumstances beyond the control of the Committee
                require an extension of time to respond, in which case the
                Committee may delay response for up to an additional 90 days,
                provided that prior notice is given to the Participant or
                Beneficiary. If the claim is denied, the Committee shall
                provide the Participant with a written notice setting forth
                the reasons for the denial, references to the provisions of
                the Plan upon which the denial was based, a description of any
                additional information or material necessary for the claimant
                to perfect his claim, and information as to how the
                Participant or Beneficiary may submit his claim for review.

Section 6.03    Review of Claims.

                A Participant or Beneficiary whose claim has been denied may
                file an appeal in writing with the Committee within 60 days of
                his receipt of the denial of his claim (which 60-day period
                may be extended by the Committee in its discretion). A
                Participant or Beneficiary shall be permitted to review
                pertinent documents and submit issues and comments in writing.
                The Committee shall review its determination and make a
                determination within a reasonable time, but not more than 60
                days after the date that the appeal was filed, unless prior
                notification is given to the claimant, and in that case not
                more than 120 days after the appeal was filed. If the claim is
                denied upon review, the Committee shall provide the claimant
                with written notice specifying the reasons for the denial,
                including the Plan provisions on which the denial was based.

                                       10

<PAGE>

                           Article VII. Miscellaneous
                           --------------------------

Section 7.01    No Contract of Employment.

                This Plan is not intended to constitute a contract of
                employment, and each Participating Employer retains the right
                to discharge or discipline any Employee for any reason.

Section 7.02    Funding.

                This Plan is intended by the Employer and the Participants to
                constitute an unfunded plan for purposes of the Code and Title
                I of ERISA. To the extent that any Participant of Beneficiary
                acquires a right to any benefits under this Plan, such right
                shall not be greater than that of an unsecured general
                creditor of the Employer, and no Participant shall have any
                right to any specific assets of the Employer. Nothing
                contained in this Plan and no action taken pursuant to the
                provisions of this Plan shall create or be construed to create
                a trust of any kind between the Employer and any Participant,
                his or her Beneficiary, or any other person. Subject to the
                foregoing restrictions, a Participating Employer may establish
                a "rabbi trust" to provide a source of payments under the Plan
                in accordance with Rev. Proc. 92-64, or may purchase an
                insurance policy or other investment vehicle. A Participant
                shall comply with the Participating Employer's reasonable
                requests for information necessary to obtain such investment.

Section 7.03    Liability of Employer.

                Subject to its obligation to pay Accrued Benefits pursuant to
                the terms of this Plan, neither the Employer nor anyone acting
                on behalf of the Employer shall be liable for any act
                performed or the failure to perform any act with regard to
                this Plan, except in the event that there has been a judicial
                determination of willful misconduct on the part of the
                Employer or such person.

Section 7.04    Termination of Participation by Participating Employer.

                Any Participating Employer other than the Sponsor may withdraw
                from the Plan at any time with regard to its Employees without
                affecting any other Participating Employer by giving 30 days'
                prior written notice to the Board. In addition, the Sponsor
                may, in its absolute discretion, terminate any Participating
                Employer's participation in the Plan at any time when, in the
                Sponsor's judgment, such Participating Employer is failing or
                refusing to discharge its obligations under the Plan.

                                       11

<PAGE>

Section 7.05    Notices, Data.

                Each Participant or Beneficiary shall be responsible for
                furnishing the Committee with the current and proper address
                for the mailing of notices, reports and benefit payments. Any
                notice required or permitted to be given shall be deemed given
                if directed to the person to whom addressed at such address
                and mailed by regular United States mail, first-class and
                prepaid. If any check mailed to such address is returned as
                undeliverable to the addressee, mailing of checks will be
                suspended until the Participant or Beneficiary furnishes the
                proper address. The Employer, the Committee, and all other
                persons associated with the Plan's operation shall have the
                right to rely on the veracity and accuracy of any required
                written data provided by the Participant or the Beneficiary,
                including age, health and marital status.

Section 7.06    Choice of Law.

                This Plan shall be governed by the laws of the Commonwealth of
                Pennsylvania, without regard to its conflict of laws
                provisions, to the extent such law is not preempted by federal
                law.

Section 7.07    Binding Effect.

                The terms of this Plan shall be binding on Plan Participants,
                their Beneficiaries, and their legal representatives, and on
                the Employer and its successors, assigns and legal
                representatives.

Section 7.08    Non-alienation.

                None of the payments, benefits or rights of any Participant or
                Beneficiary shall be subject to the claim of any creditor,
                and, in particular, to the fullest extent permitted by law,
                all such payments, benefits and rights shall be free from
                attachments, garnishment, trustee's process or any other legal
                or equitable process available to any credit of such
                Participant or Beneficiary.

Section 7.09    Incapacity.

                If the Committee determines that a Participant or Beneficiary
                is incompetent by reason of legal minority or physical or
                mental disability, the Committee shall have the power to cause
                the payments becoming due to such person to be made to another
                for the benefit of the minor or incompetent, without
                responsibility of the Employer or the Committee to see to the
                application of such payment. Payments made in accordance with
                the application of such power shall operate as a complete
                discharge of all obligations of the Employer and the Committee
                to the extent of such payment.

                                       12

<PAGE>

Section 7.10    Amendment or Termination.

                This Plan may be amended, suspended or terminated, in whole or
                in part, at any time by action of the Board in writing. No
                amendment, suspension or termination shall deprive any
                Participant of any portion of his Accrued Benefit deemed to be
                vested under the Plan as of the date of the amendment,
                suspension or termination.

Section 7.11    Other Plans.

                Nothing contained in this Plan shall preclude a Participant,
                to the extent he is otherwise eligible, from participation in
                any group insurance, pension, profit-sharing, savings, or
                other employee benefit plans or programs which the Employer in
                its discretion may make available to its employees, but the
                Employer shall not be required to establish, maintain or
                continue any such plan or program by reason of this Plan. Any
                amounts accrued or payable under this Plan shall not be deemed
                to be salary or other compensation paid to a Participant for
                purposes of computing contributions to or benefits under any
                other employee benefit plan or program, unless specifically
                required pursuant to such other plan or program.

Section 7.12    Integrated Agreement.

                This Plan document represents the entire agreement between the
                Participating Employers and the Participants concerning the
                Participants' retirement benefits, except for the Qualified
                Plan, the Susquehanna Bancshares, Inc. 401(k) Plan, the
                Susquehanna Bancshares, Inc. 401(k) Excess/Mirror Plan, the
                Susquehanna Bancshares, Inc. Employee Stock Purchase Plan, and
                Social Security.

Section 7.13    Severability.

                If any provision of this Plan shall be held invalid or
                unenforceable, such invalidity or unenforceability shall not
                affect any other provision hereof, and this Plan shall be
                construed and enforced as if such provision had not been
                included.

Section 7.14    Withholding.

                The Employer may withhold any federal, state or local taxes
                from any payment due any Participant as it or the Committee
                determines pursuant to applicable law.

Section 7.15    Construction.

                The masculine gender includes the feminine, and the singular,
                the plural and vice versa, unless the context requires
                otherwise. The headings and captions contained herein are
                provided for convenience only, shall not be considered part of
                the Plan, and shall not be employed in the construction of the
                Plan.

                                       13

<PAGE>

     IN WITNESS WHEREOF, Susquehanna Bancshares, Inc. has caused its authorized
officers to execute this document this 11th day of December, 2002.

                                     SUSQUEHANNA BANCSHARES, INC.


                                     By: /s/ Edward Balderston, Jr.
                                         ---------------------------------------

                                     Name:  Edward Balderston, Jr.

                                     Title:  Sr. V.P. & Group Executive


                                     Attest:  /s/  Lisa M. Cavage
                                              ----------------------------------

                                     Name:  Lisa M. Cavage

                                     Title:  Vice President, Secretary & Counsel

                                       14

<PAGE>

                                   APPENDIX A

                              LIST OF PARTICIPANTS

                                Frederick Bisbee

                                 Robert Bolinger

                                 Richard Cloney

                                 Gregory Duncan

                                  Richard Funke

                                 Drew Hostetter

                                  Thomas Hogan

                                 Charles Luppert

                                  Stanley Mull

                                 William Reuter

                                 Donald Showers

                                       15

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