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                                                                    EXHIBIT 10.6

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                                                                        12/18/01

                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT is made as of the18th day of December, 2001, among
STERLING FINANCIAL CORPORATION ("Corporation"), a Pennsylvania business
corporation having a place of business at 101 North Pointe Boulevard, Lancaster,
Pennsylvania 17601, BANK OF LANCASTER COUNTY, N.A. ("Bank"), a national banking
association having a place of business at, 101 North Pointe Boulevard,
Lancaster, Pennsylvania 17601 and J. ROGER MOYER, JR. ("Executive"), an
individual residing at 38 Canterbury Court, Lititz, Pennsylvania 17543.

                                   WITNESSETH:

         WHEREAS, the Corporation is a registered financial holding company with
Bank of Lancaster County as one of its subsidiaries;

         WHEREAS, Corporation and Bank desire to employ Executive to serve in
the capacity of President and Chief Operating Officer of Corporation as of
January 1, 2002, and as President and Chief Executive Officer of Corporation as
of May 1, 2002, under the terms and conditions set forth herein;

         WHEREAS, Executive desires to accept employment with Corporation and
Bank on the terms and conditions set forth herein.

                                   AGREEMENT:

         NOW, THEREFORE, the parties hereto, intending to be legally bound,
agree as follows:

1.       EMPLOYMENT. Corporation and Bank hereby employ Executive and Executive
         hereby accepts employment with Corporation and Bank, under the terms
         and conditions set forth in this Agreement.

2.       DUTIES OF EMPLOYEE. Executive shall perform and discharge well and
         faithfully such duties as an executive officer of Corporation and Bank
         as may be assigned to Executive from time to time by the Board of
         Directors of Corporation and the Chairman of the Corporation so long as
         the assignment is consistent with the Executive's office and duties.
         Executive shall be employed as President and Chief Operating Officer of
         Corporation, effective January 1, 2002, and shall be promoted to
         President and Chief Executive Officer of Corporation effective May 1,
         2002, and shall hold such other titles as may be given to him from time
         to time by the Board of Directors of Corporation. Executive shall
         devote his full time, attention and energies to the business of
         Corporation and its subsidiaries during the Employment Period (as
         defined in Section 3 of this Agreement); provided, however, that this
         Section 2 shall not be construed as preventing Executive from (a)
         engaging in activities incident or necessary to personal investments so
         long as such investment does not exceed 5% of the outstanding shares of
         any publicly held company, (b) acting as a member of the Board of
         Directors of any other corporation or as a member of the Board of
         Trustees of any other


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         organization, with the prior approval of the Board of Directors of
         Corporation, or (c) being involved in any other activity with the prior
         approval of the Board of Directors of Corporation. The Executive shall
         not engage in any business or commercial activities, duties or pursuits
         which compete with the business or commercial activities of Corporation
         or its subsidiaries, nor may the Executive serve as a director or
         officer or in any other capacity in a company which competes with
         Corporation or its subsidiaries.

3.       TERM OF AGREEMENT.

         (a)      This Agreement shall be for a three (3) year period (the
                  "Employment Period") beginning on January 1, 2002, and if not
                  previously terminated pursuant to the terms of this Agreement,
                  the Employment Period shall end three (3) years later;
                  provided however, that this Agreement will be automatically
                  renewed one year later on the first anniversary date of
                  January 1, 2002 (the "Renewal Date") for the three-year period
                  commencing on such date and ending three years later, unless
                  either party gives written notice of non-renewal to the other
                  party at least ninety (90) days prior to the Renewal Date (in
                  which case this Agreement will continue in effect for a term
                  ending two (2) years from the Renewal Date). If this Agreement
                  is renewed on the Renewal Date, it will be automatically
                  renewed on the first anniversary date of the Renewal Date and
                  each subsequent year (the "Annual Renewal Date") for a period
                  ending three years from each Annual Renewal Date, unless
                  either party gives written notice of non-renewal to the other
                  party at least ninety (90) days prior to an Annual Renewal (in
                  which case this Agreement will continue in effect for a term
                  ending two (2) years from the Annual Renewal Date immediately
                  following such notice).

         (b)      Notwithstanding the provisions of Section 3(a) of this
                  Agreement, this Agreement shall terminate automatically for
                  Cause (as defined herein) upon written notice from the Board
                  of Directors of Corporation to Executive. As used in this
                  Agreement, "Cause" shall mean any of the following:

                  (i)      Executive's conviction of or plea of guilty or nolo
                           contendere to a felony, a crime of falsehood or a
                           crime involving moral turpitude, or the actual
                           incarceration of Executive for a period of forty-five
                           (45) consecutive days or more;

                  (ii)     Executive's failure to follow the good faith lawful
                           instructions of the Board of Directors of Corporation
                           with respect to its operations, after written notice
                           from Corporation and a failure to cure such violation
                           within thirty (30) days of said written notice;

                  (iii)    Executive's willful failure to substantially perform
                           Executive's duties to Corporation or its
                           subsidiaries, other than a failure resulting from
                           Executive's incapacity because of physical or mental
                           illness, as provided in Section 3 (d)

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                           of this Agreement, after written notice from
                           Corporation or Bank and a failure to cure such
                           violation within thirty (30) days of said written
                           notice;

                  (iv)     Executive's intentional violation of the provisions
                           of this Agreement, after written notice from
                           Corporation and a failure to cure such violation
                           within thirty (30) days of said written notice;

                  (v)      Dishonesty of the Executive in the performance of his
                           duties;

                  (vi)     Executive's removal or prohibition from being an
                           institutional-affiliated party by a final order of an
                           appropriate federal banking agency pursuant to
                           Section 8(e) of the Federal Deposit Insurance Act or
                           by the Office of the Comptroller of the Currency
                           pursuant to national law;

                  (vii)    Conduct on the part of the Executive which brings
                           public discredit to Corporation or its subsidiaries,
                           as determined by an affirmative vote of seventy
                           percent (70%) of the disinterested members of the
                           Boards of Directors of Corporation and Bank;

                  (viii)   Executive's breach of fiduciary duty involving
                           personal profit.

                  (ix)     Unlawful discrimination by the Executive, including
                           harassment against Corporation's or Corporation's
                           subsidiary's employees, customers, business
                           associates, contractors, or vendors, which could
                           result in liability to Corporation or one of its
                           subsidiaries; or

                  (x)      Theft or material abuse by executive of Corporation's
                           property or the property of one of Corporation's
                           subsidiaries, or the property of Corporation's or
                           Bank's customers, employees, subsidiaries,
                           contractors, vendors, or business associates.

                  If this Agreement is terminated for Cause, all of Executive's
                  rights under this Agreement shall cease as of the effective
                  date of such termination.

         (c)      Notwithstanding the provisions of Section 3(a) of this
                  Agreement, this Agreement shall terminate automatically upon
                  Executive's voluntary termination of employment (other than in
                  accordance with Section 5 of this Agreement) for Good Reason.
                  The term "Good Reason" shall mean (i) the assignment of duties
                  and responsibilities inconsistent with Executive's status as
                  President and Chief Operating Officer of Corporation and,
                  after May 1, 2002, Chief Executive Officer of the Corporation,
                  (ii) a reassignment which requires Executive to move his
                  principal residence more than fifty (50) miles from the
                  location of Corporation's or Bank's principal executive office
                  immediately prior to this Agreement, (iii) any removal of the
                  Executive from office or any adverse change in the terms and
                  conditions of the Executive's employment, except for any
                  termination of the Executive's employment under the

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                  provisions of Section 3(b) of this Agreement, (iv) any
                  reduction in the Executive's Annual Base Salary as in effect
                  on the date this Agreement is executed or as the same may be
                  increased from time to time, except such reductions that are
                  the result of a national financial depression, or national or
                  bank emergency, or (v) any failure of Corporation or Bank to
                  provide the Executive with benefits at least as favorable as
                  those enjoyed by the Executive during the Employment Period
                  under any of the pension or other qualified retirement, life
                  insurance, medical, health and accident, disability or other
                  employee plans of Corporation or Bank, or the taking of any
                  action that would materially reduce any such benefits, unless
                  such reduction is part of a reduction applicable to all
                  employees.

                  At the option of the Executive, exercisable by the Executive
                  within ninety (90) days after the occurrence of the event
                  constituting "Good Reason," the Executive may resign from
                  employment under this Agreement by a notice in writing (the
                  "Notice of Termination") delivered to Corporation and Bank and
                  the provisions of this Section 3(c) of this Agreement shall
                  thereupon apply.

                  If such termination occurs for Good Reason, then Corporation
                  or Bank shall pay Executive an amount equal to the remaining
                  balance of the Agreed Compensation otherwise due to the
                  Executive for the remainder of the then existing Employment
                  Period, which amount shall be payable in equal monthly
                  installments and shall be subject to federal, state and local
                  tax withholdings. In addition, for the remainder of the then
                  existing Employment Period, or until Executive secures
                  substantially similar benefits through other employment,
                  whichever shall first occur, Executive shall receive a
                  continuation of all life, disability, medical insurance and
                  other normal health and welfare benefits in effect with
                  respect to Executive during the two (2) years prior to his
                  termination of employment, or, if Corporation and Bank cannot
                  provide such benefits because Executive is no longer an
                  employee, a dollar amount equal to the cost to Executive of
                  obtaining such benefits (or substantially similar benefits).
                  If permitted under the terms of the plan, Executive may
                  continue to participate in all qualified and non-qualified
                  retirement benefit plans as if his employment had continued
                  through the remaining term of the Agreement. If Executive is
                  not eligible to continue to participate in qualified or
                  non-qualified retirement plans, Executive will receive a lump
                  sum cash payment equal to 29% of the payments to be received
                  for termination of this Agreement under this provision.
                  However, in the event that the payment described herein, when
                  added to all other amounts or benefits provided to or on
                  behalf of the Executive in connection with his termination of
                  employment, would result in the imposition of an excise tax
                  under Code Section 4999, such payments shall be retroactively
                  (if necessary) reduced to the extent necessary to avoid such
                  excise tax imposition. Upon written notice to Executive,
                  together with calculations of Corporation's independent
                  auditors, Executive shall remit to Corporation the amount of
                  the reduction plus such interest as may be necessary to avoid
                  the imposition of such excise tax. Notwithstanding the
                  foregoing or any other provision of this contract to the
                  contrary, if any portion of the amount herein payable to the
                  Executive is determined to be non-deductible, pursuant

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                  to the regulations promulgated under Section 280G of the
                  Internal Revenue Code of 1986, as amended (the "Code"), the
                  Corporation shall be required only to pay to Executive the
                  amount determined to be deductible under Section 280G.

         (d)      Notwithstanding the provisions of Section 3(a) of this
                  Agreement, this Agreement shall terminate automatically upon
                  Executive's Disability and Executive's rights under this
                  Agreement shall cease as of the date of such termination;
                  provided, however, that Executive shall nevertheless be
                  entitled to receive any benefits that may be available under
                  any disability plan of Corporation and Bank, until the
                  earliest of (i) Executive's return to employment, (ii) his
                  attainment of age 65, or (iii) his death. In addition,
                  Executive shall receive for such period a continuation of all
                  life, disability, medical insurance and other normal health
                  and welfare benefits in effect with respect to Executive
                  during the two (2) years prior to his disability, or, if
                  Corporation and Bank cannot provide such benefits because
                  Executive is no longer an employee, a dollar amount equal to
                  the cost to Executive of obtaining such benefits (or
                  substantially similar benefits). For purposes of this
                  Agreement, the Executive shall have a Disability if, as a
                  result of physical or mental injury or impairment, Executive
                  is unable to perform all of the essential job functions of his
                  position on a full time basis taking into account any
                  reasonable accommodation required by law, and without posting
                  a direct threat to himself and others, for a period of one
                  hundred eighty (180) days or more. The Executive shall have no
                  duty to mitigate any payment provided for in this Section 3(d)
                  by seeking other employment.

         (e)      Executive agrees that in the event his employment under this
                  Agreement is terminated, regardless of the reason for
                  termination, Executive shall resign as a director of
                  Corporation and Bank, or any affiliate or subsidiary thereof,
                  if he is then serving as a director of any of such entities.

         (f)      The term "Agreed Compensation" shall equal the sum of (A) the
                  Executive's highest Annual Base Salary under the Agreement,
                  and (B) the average of the Executive's annual bonuses with
                  respect to the three (3) calendar years immediately preceding
                  the Executive's termination; provided, however, that if the
                  Executive is terminated after January 1, 2003, but before
                  January 1, 2004, then Agreed Compensation shall equal the sum
                  of (A) the Executive's highest Annual Base Salary under the
                  Agreement and (B) the Executive's annual bonus for 2002. If
                  the Executive is terminated after January 1, 2004, but before
                  January 1, 2005, then Agreed Compensation shall equal the sum
                  of (A) the Executive's highest Annual Base Salary under the
                  Agreement and (B) the average of the Executive's annual
                  bonuses for 2002 and 2003.

4.       EMPLOYMENT PERIOD COMPENSATION.

         (a)      Annual Base Salary. For services performed by Executive under
                  this Agreement, Corporation shall pay Executive an Annual Base
                  Salary during the Employment Period at the rate of Two Hundred
                  Seventy Thousand Dollars ($270,000.00) per year

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                  (subject to applicable withholdings and deductions) payable at
                  the same times as salaries are payable to other executive
                  employees of Corporation. Corporation may, from time to time,
                  increase Executive's Annual Base Salary, and any and all such
                  increases shall be deemed to constitute amendments to this
                  Section 4(a) to reflect the increased amounts, effective as of
                  the date established for such increases by the Board of
                  Directors of Corporation or any committee of such Board in the
                  resolutions authorizing such increases.

         (b)      Bonus. For services performed by Executive under this
                  Agreement, Corporation may, from time to time, pay a bonus or
                  bonuses to Executive as Corporation, in its sole discretion,
                  deems appropriate. The payment of any such bonuses shall not
                  reduce or otherwise affect any other obligation of Corporation
                  or Bank to Executive provided for in this Agreement. Executive
                  is entitled to participate in the bonus programs available to
                  senior executives.

         (c)      Paid Time Off and/or Vacations. During the term of this
                  Agreement, Executive shall be entitled to paid time off in
                  accordance with the policies as established from time to time
                  by the Boards of Directors of Corporation and Bank for the
                  Corporation's and Bank's senior management.

         (d)      Automobile. During the term of this Agreement, Corporation and
                  Bank shall provide Executive with exclusive use of an
                  automobile mutually agreed upon by Corporation and Bank and
                  reasonably consistent with Executive's position. Corporation
                  and Bank shall be responsible and shall pay for all costs of
                  insurance coverage, repairs, maintenance and other operating
                  and incidental expenses, including license, fuel and oil.
                  Corporation and Bank shall provide Executive with a
                  replacement automobile at approximately the time Executive's
                  automobile reaches three (3) years of age or 50,000 miles,
                  whichever is first, and approximately every three (3) years or
                  50,000 miles thereafter, upon the same terms and conditions.

         (e)      Employee Benefit Plans. During the term of this Agreement,
                  Executive shall be entitled to participate in or receive the
                  benefits of any employee benefit plan currently in effect at
                  Corporation and Bank, subject to the terms of said plan, until
                  such time that the Boards of Directors of Corporation and Bank
                  authorize a change in such benefits. Corporation and Bank
                  shall not make any changes in such plans or benefits which
                  would adversely affect Executive's rights or benefits
                  thereunder, unless such change occurs pursuant to a program
                  applicable to all executive officers of Corporation and Bank
                  and does not result in a proportionately greater adverse
                  change in the rights of or benefits to Executive as compared
                  with any other executive officer of Corporation and Bank.
                  Nothing paid to Executive under any plan or arrangement
                  presently in effect or made available in the future shall be
                  deemed to be in lieu of the salary payable to Executive
                  pursuant to Section 4(a) hereof.

         (f)      Business Expenses. During the term of this Agreement,
                  Executive shall be entitled to receive prompt reimbursement
                  for all reasonable expenses incurred by him, which

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                  are properly accounted for, in accordance with the policies
                  and procedures established by the Boards of Directors of
                  Corporation and Bank for their executive officers. Corporation
                  shall reimburse Executive for any and all initiation fees,
                  membership dues, assessments, and reasonable related business
                  expenses associated with the Executive's membership in a
                  mutually agreeable country club and the Hamilton Club of
                  Lancaster.

         (g)      Stock Options. Executive shall be entitled to participate in
                  the Corporation's stock option plans consistent with his
                  position as a member of Corporation's and Bank's senior
                  management. Upon a Change in Control (as defined in Section
                  5(b) of this Agreement), all options theretofore granted to
                  the Executive by the Corporation and not previously
                  exercisable shall become fully exercisable to the same extent
                  and in the same manner as if they had become exercisable by
                  passage of time or by virtue of the Corporation achieving
                  certain performance objectives in accordance with the relevant
                  provisions of any plan and any agreement.

5.       TERMINATION OF EMPLOYMENT FOLLOWING CHANGE IN CONTROL.

         (a)      If a Change in Control (as defined in Section 5(b) of this
                  Agreement) shall occur, then, at the option of Executive,
                  exercisable by Executive within three hundred sixty five (365)
                  days of the Change in Control, Executive may resign from
                  employment with Corporation and Bank (or, if involuntarily
                  terminated, give notice of intention to collect benefits under
                  this Agreement) by delivering a notice in writing (the "Notice
                  of Termination") to Corporation and Bank and the provisions of
                  Section 6 of this Agreement shall apply.

         (b)      As used in this Agreement, "Change in Control" shall mean the
                  occurrence of any of the following:

                  (i)      (A) a merger, consolidation or division involving
                           Corporation or Bank, (B) a sale, exchange, transfer
                           or other disposition of substantially all of the
                           assets of Corporation or Bank, or (C) a purchase by
                           Corporation or Bank of substantially all of the
                           assets of another entity, unless (y) such merger,
                           consolidation, division, sale, exchange, transfer,
                           purchase or disposition is approved in advance by
                           seventy percent (70%) or more of the members of the
                           Board of Directors of Corporation or Bank (of the
                           entity affected by the transaction) who are not
                           interested in the transaction and (z) a majority of
                           the members of the Board of Directors of the legal
                           entity resulting from or existing after any such
                           transaction and of the Board of Directors of such
                           entity's parent corporation, if any, are former
                           members of the Board of Directors of Corporation or
                           Bank (of the entity affected by the transaction);

                  (ii)     any "person" (as such term is used in Sections 13(d)
                           and 14(d) of the Securities Exchange Act of 1934 (the
                           "Exchange Act")), other than Corporation or Bank or
                           any "person" who on the date hereof is a director or

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                           officer of Corporation or Bank is or becomes the
                           "beneficial owner" (as defined in Rule 13d-3 under
                           the Exchange Act), directly or indirectly, of
                           securities of Corporation or Bank representing
                           twenty-five (25%) percent or more of the combined
                           voting power of Corporation or Bank's then
                           outstanding securities; or

                  (iii)    during any period of two (2) consecutive years during
                           the term of Executive's employment under this
                           Agreement, individuals who at the beginning of such
                           period constitute the Board of Directors of
                           Corporation or Bank cease for any reason to
                           constitute at least a majority thereof, unless the
                           election of each director who was not a director at
                           the beginning of such period has been approved in
                           advance by directors representing at least two-thirds
                           of the directors then in office who were directors at
                           the beginning of the period; or

                  (iv)     any other change in control of Corporation and Bank
                           similar in effect to any of the foregoing.

6.       RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT FOLLOWING CHANGE IN
         CONTROL.

         (a)      In the event that Executive delivers a Notice of Termination
                  (as defined in Section 5(a) of this Agreement) to Corporation
                  and Bank, Executive shall be entitled to receive the
                  compensation and benefits set forth below:

                  If, at the time of termination of Executive's employment, a
                  "Change in Control" (as defined in Section 5(b) of this
                  Agreement) has also occurred, Corporation and Bank shall pay
                  Executive a lump sum amount equal to and no greater than 2.99
                  times the Executive's Agreed Compensation as defined in
                  Section 3(f) of this Agreement (the payment of which shall be
                  subject to applicable taxes and withholdings). In addition,
                  for a period of three (3) years from the date of termination
                  of employment, or until Executive secures substantially
                  similar benefits through other employment, whichever shall
                  first occur, Executive shall receive a continuation of all
                  life, disability, medical insurance and other normal health
                  and welfare benefits in effect with respect to Executive
                  during the two (2) years prior to his termination of
                  employment, or, if Corporation and Bank cannot provide such
                  benefits because Executive is no longer an employee, a dollar
                  amount equal to the cost to Executive of obtaining such
                  benefits (or substantially similar benefits). If permitted
                  under the terms of the plan, Executive may continue to
                  participate in all qualified and non- qualified retirement
                  plans as if his employment had continued through the then
                  remaining term of the Agreement. If Executive is not eligible
                  to participate in non- qualified or qualified retirement
                  plans, Executive will receive a lump sum cash payment equal to
                  29% of the payments to be received for termination of the
                  Agreement under this provision. However, in the event the
                  payment described herein, when added to all other amounts or
                  benefits provided to or on behalf of the Executive in
                  connection with his termination of employment, would result in
                  the imposition of an excise tax under Code Section 4999, such
                  payments shall be retroactively (if

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                  necessary) reduced to the extent necessary to avoid such
                  excise tax imposition. Upon written notice to Executive,
                  together with calculations of Corporation's independent
                  auditors, Executive shall remit to Corporation the amount of
                  the reduction plus such interest as may be necessary to avoid
                  the imposition of such excise tax. Notwithstanding the
                  foregoing or any other provision of this contract to the
                  contrary, if any portion of the amount herein payable to the
                  Executive is determined to be non- deductible pursuant to the
                  regulations promulgated under Section 280G of the Internal
                  Revenue Code of 1986, as amended (the "Code"), the Corporation
                  shall be required only to pay to Executive the amount
                  determined to be deductible under Section 280G.

         (b)      Executive shall not be required to mitigate the amount of any
                  payment provided for in this Section 6 by seeking other
                  employment or otherwise. Unless otherwise agreed to in
                  writing, the amount of payment or the benefit provided for in
                  this Section 6 shall not be reduced by any compensation earned
                  by Executive as the result of employment by another employer
                  or by reason of Executive's receipt of or right to receive any
                  retirement or other benefits after the date of termination of
                  employment or otherwise.

7.       RIGHTS IN EVENT OF TERMINATION OF EMPLOYMENT ABSENT CAUSE.

         (a)      In the event that Executive's employment is involuntarily
                  terminated by Corporation and/or Bank without Cause, and in a
                  situation not addressed by the Change in Control provisions
                  set forth in Section 6 of this Agreement, Corporation and Bank
                  shall pay Executive an amount equal to 2.0 times the
                  Executive's Agreed Compensation or the remaining balance of
                  the Agreed Compensation otherwise due to the Executive for the
                  remainder of the then existing Employment Period, whichever is
                  greater, and shall be payable in equal monthly installments
                  and shall be subject to federal, state and local tax
                  withholdings. In addition, for the remainder of the then
                  existing Employment Period or until Executive secures
                  substantially similar benefits through other employment,
                  whichever shall first occur, Executive shall receive a
                  continuation of all life, disability, medical insurance and
                  other normal health and welfare benefits in effect with
                  respect to Executive during the two (2) years prior to his
                  termination of employment, or, if Corporation and Bank cannot
                  provide such benefits because Executive is no longer an
                  employee, a dollar amount equal to the cost to Executive of
                  obtaining such benefits (or substantially similar benefits).
                  In addition, if permitted pursuant to the terms of the plan,
                  Executive may continue to participate in all qualified and
                  non-qualified retirement benefits plans as if his employment
                  had continued through the then remaining term of the
                  Agreement. If Executive is not eligible to participate in
                  non-qualified or qualified retirement plans, Executive will
                  receive a lump sum cash payment equal to 29% of the payments
                  to be received for termination of the Agreement under this
                  provision. However, in the event the payment described herein,
                  when added to all other amounts or benefits provided to or on
                  behalf of the Executive in connection with his termination of
                  employment, would result in the imposition of an excise tax
                  under

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                  Code Section 4999, such payments shall be retroactively (if
                  necessary). However, in the event the payment described
                  herein, when added to all other amounts or benefits provided
                  to or on behalf of the Executive in connection with his
                  termination of employment, would result in the imposition of
                  an excise tax under Code Section 4999, such payments shall be
                  retroactively (if necessary) reduced to the extent necessary
                  to avoid such excise tax imposition. Upon written notice to
                  Executive, together with calculations of Corporation's
                  independent auditors, Executive shall remit to Corporation the
                  amount of the reduction plus such interest as may be necessary
                  to avoid the imposition of such excise tax. Notwithstanding
                  the foregoing or any other provision of this contract to the
                  contrary, if any portion of the amount herein payable to the
                  Executive is determined to be non-deductible pursuant to the
                  regulations promulgated under Section 280G of the Internal
                  Revenue Code of 1986, as amended (the "Code"), the Corporation
                  shall be required only to pay to Executive the amount
                  determined to be deductible under Section 280G.

         (b)      Executive shall not be required to mitigate the amount of any
                  payment provided for in this Section 7 by seeking other
                  employment or otherwise. Unless otherwise agreed to in
                  writing, the amount of payment or the benefit provided for in
                  this Section 7 shall not be reduced by any compensation earned
                  by Executive as the result of employment by another employer
                  or by reason of Executive's receipt of or right to receive any
                  retirement or other benefits after the date of termination of
                  employment or otherwise.

8.       COVENANT NOT TO COMPETE.

         (a)      Executive hereby acknowledges and recognizes the highly
                  competitive nature of the business of Corporation and Bank and
                  accordingly agrees that, during and for the applicable period
                  set forth in Section 8(c) hereof, Executive shall not, except
                  as otherwise permitted in writing by the Corporation and the
                  Bank:

                  (i)      be engaged, directly or indirectly, either for his
                           own account or as agent, consultant, employee,
                           partner, officer, director, proprietor, investor
                           (except as an investor owning less than 5% of the
                           stock of a publicly owned company) or otherwise of
                           any person, firm, corporation or enterprise engaged
                           in (1) the banking (including financial or bank
                           holding company) or financial services industry, or
                           (2) any other activity in which Corporation or Bank
                           or any of their subsidiaries or affiliates, other
                           than Town and Country, Inc. and Equipment Finance,
                           Inc., are engaged during the Employment Period, and
                           remain so engaged at the end of the Employment
                           Period, in any county in which, at any time during
                           the Employment Period or on the date of termination
                           of the Executive's employment, Corporation, Bank or
                           any of their subsidiaries or affiliates conducted
                           business, or in any county contiguous to such a
                           county, including countries located outside of the
                           Commonwealth of Pennsylvania (the "Non-Competition
                           Area"); or


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                  (ii)     provide financial or other assistance to any person,
                           firm, corporation, or enterprise engaged in (1) the
                           banking (including financial or bank holding company)
                           or financial services industry, or (2) any other
                           activity in which Corporation or Bank or any of their
                           subsidiaries or affiliates, other than Town and
                           Country, Inc. and Equipment Finance, Inc., are
                           engaged during the Employment Period, in the
                           Non-Competition Area; or

                  (iii)    directly or indirectly contact, solicit or induce any
                           person, corporation or other entity who or which is a
                           customer or referral source of Corporation or any of
                           its subsidiaries or affiliates, on the Effective
                           Date; at any time during the Employment Period; or on
                           the effective date of termination of the Executive's
                           employment; or

                  (iv)     directly or indirectly solicit, induce or encourage
                           any employee of Corporation or any of its
                           subsidiaries or affiliates, who is employed on the
                           Effective Date; at any time during the Employment
                           Period; or on the effective date of termination of
                           the Executive's employment, to leave the employ of
                           Corporation or any of its subsidiaries or affiliates
                           or to seek, obtain or accept employment with any
                           person other than Corporation or any of its
                           subsidiaries or affiliates.

         (b)      It is expressly understood and agreed that, although Executive
                  and Corporation and Bank consider the restrictions contained
                  in Section 8(a) and (c) of this Agreement reasonable for the
                  purpose of preserving for Corporation and Bank and their
                  subsidiaries their good will and other proprietary rights, if
                  a final judicial determination is made by a court having
                  jurisdiction that the time or territory or any other
                  restriction contained in Section 8(a) and (c) of this
                  Agreement is an unreasonable or otherwise unenforceable
                  restriction against Executive, the provisions of Section 8(a)
                  and (c) of this Agreement shall not be rendered void but shall
                  be deemed amended to apply as to such maximum time and
                  territory and to such other extent as such court may
                  judicially determine or indicate to be reasonable.

         (c)      The provisions of this Section 8 shall be applicable
                  commencing on January 1, 2002 and ending on one of the
                  following dates, as applicable:

                  (i)      if Executive's employment terminates in accordance
                           with the provisions of Section 3(c) of this Agreement
                           (relating to termination for Good Reason), the end of
                           the then existing Employment Period; or

                  (ii)     if Executive's employment terminates in accordance
                           with the provisions of Section 3(b) of this Agreement
                           (relating to termination for Cause), the second
                           anniversary date of the effective date of termination
                           of employment; or

                  (iii)    if the Executive voluntarily terminates his
                           employment in accordance with the provisions of
                           Section 5 of this Agreement (relating to termination
                           from

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                           following Change in Control), the second anniversary
                           date of the effective date of termination of
                           employment; or

                  (iv)     if the Executive's employment is involuntarily
                           terminated in accordance with the provisions of
                           Section 7 of this Agreement (relating to Termination
                           Absent Cause), the second anniversary date of the
                           effective date of termination of employment; or

                  (v)      if the Executive voluntarily terminates his
                           employment without Good Reason and absent Change in
                           Control, the second anniversary date of the effective
                           date of termination of employment; or

                  (vi)     if the Agreement expires by its terms in accordance
                           with the provisions of Section 3(a) and other than
                           for Cause, the second anniversary date of the
                           effective date of termination of employment.

9.       UNAUTHORIZED DISCLOSURE. During the term of his employment hereunder,
         or at any later time, the Executive shall not, without the written
         consent of the Boards of Directors of Corporation and Bank or a person
         authorized thereby, knowingly disclose to any person, other than an
         employee of Corporation or Bank or a person to whom disclosure is
         reasonably necessary or appropriate in connection with the performance
         by the Executive of his duties as an executive of Corporation and Bank,
         any material confidential information obtained by him while in the
         employ of Corporation and Bank with respect to any of Corporation and
         Bank's services, products, improvements, formulas, designs or styles,
         processes, customers, customer lists, methods of business or any
         business practices the disclosure of which could be or will be damaging
         to Corporation or Bank; provided, however, that confidential
         information shall not include any information known generally to the
         public (other than as a result of unauthorized disclosure by the
         Executive or any person with the assistance, consent or direction of
         the Executive) or any information of a type not otherwise considered
         confidential by persons engaged in the same business of a business
         similar to that conducted by Corporation and Bank or any information
         that must be disclosed as required by law.

10.      WORK MADE FOR HIRE. Any work performed by the Executive under this
         Agreement should be considered a "Work Made for Hire" as that phrase is
         defined by the U.S. patent laws and shall be owned by and for the
         express benefit of Corporation, Bank and their subsidiaries and
         affiliates. In the event it should be established that such work does
         not qualify as a Work Made for Hire, the Executive agrees to and does
         hereby assign to Corporation, Bank and their affiliates and
         subsidiaries, all of his rights, title, and/or interest in such work
         product, including, but not limited to, all copyrights, patents,
         trademarks, and proprietary rights.

11.      RETURN OF COMPANY PROPERTY AND DOCUMENTS. The Executive agrees that, at
         the time of termination of his employment, regardless of the reason for
         termination, he will deliver to Corporation, Bank and their
         subsidiaries and affiliates, any and all company property, including,
         but not limited to, keys, security codes or passes, mobile telephones,
         pagers,

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         computers, devices, confidential information (as defined in this
         Agreement), records, data, notes, reports, proposals, lists,
         correspondence, specification, drawings, blueprints, sketches, software
         programs, equipment, other documents or property, or reproductions of
         any of the aforementioned items developed or obtained by the Executive
         during the course of his employment.

12.      LIABILITY INSURANCE. Corporation and Bank shall use their best efforts
         to obtain insurance coverage for the Executive under an insurance
         policy covering officers and directors of Corporation and Bank against
         lawsuits, arbitrations or other legal or regulatory proceedings;
         however, nothing herein shall be construed to require Corporation
         and/or Bank to obtain such insurance, if the Board of Directors of the
         Corporation and/or Bank determine that such coverage cannot be obtained
         at a reasonable price.

13.      NOTICES. Except as otherwise provided in this Agreement, any notice
         required or permitted to be given under this Agreement shall be deemed
         properly given if in writing and if mailed by registered or certified
         mail, postage prepaid with return receipt requested, to Executive's
         residence, in the case of notices to Executive, and to the principal
         executive offices of Corporation and Bank, in the case of notices to
         Corporation and Bank.

14.      WAIVER. No provision of this Agreement may be modified, waived or
         discharged unless such waiver, modification or discharge is agreed to
         in writing and signed by Executive and an executive officer
         specifically designated by the Boards of Directors of Corporation. No
         waiver by either party hereto at any time of any breach by the other
         party hereto of, or compliance with, any condition or provision of this
         Agreement to be performed by such other party shall be deemed a waiver
         of similar or dissimilar provisions or conditions at the same or at any
         prior or subsequent time.

15.      ASSIGNMENT. This Agreement shall not be assignable by any party, except
         by Corporation and Bank to any successor in interest to their
         respective businesses.

16.      ATTORNEY'S FEES AND COSTS. If any action at law or in equity is
         necessary to enforce or interpret the terms of this Agreement, the
         prevailing party shall be entitled to reasonable attorney's fees,
         costs, and necessary disbursements in addition to any other relief that
         may be proper.

17.      INDEMNIFICATION. The Corporation and/or Bank will indemnify the
         Executive, to the fullest extent permitted under Pennsylvania and
         federal law, with respect to any threatened, pending or completed legal
         or regulatory action, suit or proceeding brought against him by reason
         of the fact that he is or was a director, officer, employee or agent of
         the Corporation, or is or was serving at the request of the Corporation
         as a director, officer, employee or agent of another person or entity.
         To the fullest extent permitted by Pennsylvania and federal law, the
         Corporation will, in advance of final disposition, pay any and all
         expenses incurred by the Executive in connection with any threatened,
         pending or completed legal or regulatory action, suit or proceeding
         with respect to which he may be entitled to indemnification hereunder.

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18.      ENTIRE AGREEMENT. This Agreement supersedes any and all agreements,
         either oral or in writing, between the parties with respect to the
         employment of the Executive by the Bank and/or Corporation, including
         the Change of Control Agreement dated August 4, 1999, and this
         Agreement contains all the covenants and agreements between the parties
         with respect to employment.

19.      SUCCESSORS; BINDING AGREEMENT.

         (a)      Corporation will require any successor (whether direct or
                  indirect, by purchase, merger, consolidation, or otherwise) to
                  all or substantially all of the businesses and/or assets of
                  Corporation and/or its subsidiaries to expressly assume and
                  agree to perform this Agreement in the same manner and to the
                  same extent that Corporation and Bank would be required to
                  perform it if no such succession had taken place. Failure by
                  Corporation to obtain such assumption and agreement prior to
                  the effectiveness of any such succession shall constitute a
                  breach of this Agreement and the provisions of Section 3 of
                  this Agreement shall apply.

         (b)      This Agreement shall inure to the benefit of and be
                  enforceable by Executive's personal or legal representatives,
                  executors, administrators, heirs, distributees, devisees and
                  legatees. If Executive should die after a Notice of
                  Termination is delivered by Executive, or following
                  termination of Executive's employment without Cause, and any
                  amounts would be payable to Executive under this Agreement if
                  Executive had continued to live, all such amounts shall be
                  paid in accordance with the terms of this Agreement to
                  Executive's devisee, legatee, or other designee, or, if there
                  is no such designee, to Executive's estate.

20.      ARBITRATION. Corporation, Bank and Executive recognize that in the
         event a dispute should arise between them concerning the interpretation
         or implementation of this Agreement, (except for any enforcement sought
         with respect to Sections 8, 9, 10 or 11 of this Agreement which may be
         litigated in court,) lengthy and expensive litigation will not afford a
         practical resolution of the issues within a reasonable period of time.
         Consequently, each party agrees that all disputes, disagreements and
         questions of interpretation concerning this Agreement are to be
         submitted for resolution, in Philadelphia, Pennsylvania, to the
         American Arbitration Association (the "Association") in accordance with
         the Association's National Rules for the Resolution of Employment
         Disputes or other applicable rules then in effect ("Rules").
         Corporation, Bank or Executive may initiate an arbitration proceeding
         at any time by giving notice to the other in accordance with the Rules.
         Corporation and Bank and Executive may, as a matter of right, mutually
         agree on the appointment of a particular arbitrator from the
         Association's pool. The arbitrator shall not be bound by the rules of
         evidence and procedure of the courts of the Commonwealth of
         Pennsylvania but shall be bound by the substantive law applicable to
         this Agreement. The decision of the arbitrator, absent fraud, duress,
         incompetence or gross and obvious error of fact, shall be final and
         binding upon the parties and shall be enforceable in courts of proper
         jurisdiction. Following written notice of a request for arbitration,
         Corporation, Bank and Executive shall be entitled to an injunction
         restraining all further proceedings in any pending or subsequently
         filed litigation concerning

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         this Agreement, except as otherwise provided herein or any enforcement
         sought with respect to Sections 8, 9 , 10 or 11.

21.      NO MITIGATION OR OFFSET. The Executive will not be required to mitigate
         the amount of any payment provided for in this Agreement by seeking
         employment or otherwise; nor will any amounts or benefits payable or
         provided hereunder be reduced in the event he does not secure
         employment, except as otherwise provided herein.

22.      VALIDITY. The invalidity or unenforceability of any provision of this
         Agreement shall not affect the validity or enforceability of any other
         provision of this Agreement, which shall remain in full force and
         effect.

23.      APPLICABLE LAW. This Agreement shall be governed by and construed in
         accordance with the domestic, internal laws of the Commonwealth of
         Pennsylvania, without regard to its conflicts of laws principles.

24.      HEADINGS. The section headings of this Agreement are for convenience
         only and shall not control or affect the meaning or construction or
         limit the scope or intent of any of the provisions of this Agreement.

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

ATTEST:                         STERLING FINANCIAL CORPORATION


   /s/ Ronald L. Bowman         By   /s/ Glenn R. Walz
---------------------------        ---------------------------------------------
 Secretary                            Vice Chairman of the Board of Directors


                                BANK OF LANCASTER COUNTY, N.A.


  /s/ Ronald L. Bowman          By   /s/ Glenn R. Walz
--------------------------         ---------------------------------------------
 Secretary                           Vice Chairman of the Board of Directors


WITNESS:

/s/ Kathleen A. Prime             /s/ J. Roger Moyer, Jr
---------------------------     ------------------------------------------------
                                      J. Roger Moyer, Jr.
                                      "Executive"


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