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                                                                    Exhibit 10.3


                              EMPLOYMENT AGREEMENT

     This Employment Agreement ("Agreement") is entered into this 16th day of
November, 2000, by and between William C. Bullock, Jr. ("Bullock") and Merrill
Merchants Bancshares, Inc. (the "Company").

                                    PREAMBLE

     WHEREAS, Bullock has served as Chairman of the Board of Directors of the
Company and Chairman of the Board of Directors of Merrill Merchants Bank (the
"Bank") since their inception;

     WHEREAS, Bullock will continue as a member of the Board of Directors of the
Company and the Bank for the remainder of his current respective terms;

     WHEREAS, Bullock intends to stand for re-election to the Board of Directors
of the Company and Bank upon the expiration of his current respective terms and
desires to provide for representation on the Board of Directors by himself or
another designee of The Bullock Family Trust (the "Trust") or of his immediate
family for so long as the Trust and/or his immediate family owns more than three
percent (3%) of the Common Stock of the Company; and

     WHEREAS, Bullock has gained much valuable experience and knowledge
beneficial to the Company and he has agreed to provide advisory and related
services to the Company and the Bank;

     NOW THEREFORE, for and in consideration of the promises and other good and
valuable consideration set forth herein, the parties agree as follows.

                                    AGREEMENT

     1.0 SERVICES

     1.1 In addition to his services as a Director, Bullock shall provide the
following services (the "Services") to the Company as directed by the Company
for as long as he serves as a member of the Board of Directors of the Company or
of the Bank:

     a. Render advisory services and provide the Company the benefit of his
special knowledge, skill, contacts, good will and business experience in the
areas of banking and investment decisions;

     b. Keep informed as to the operation of the Company and its subsidiaries
and, as an advisor and consultant, promote their financial welfare;


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     c. Undertake such services, duties, tasks and responsibilities related to
the operations and continued development of the business of the Company as the
Company may from time to time reasonably request; and

     d. Perform various other duties and responsibilities as agreed to by the
Company and Bullock with respect to the Company's business and expansion
thereof.

     1.2 Bullock shall perform the Services under the direction of the Chief
Executive Officer of the Company. The Company shall provide to Bullock all
necessary and appropriate office space and support staff, including secretarial
support, for the provision of Services. Notwithstanding the scope of the
Services, the parties agree that the provision of the Services by Bullock is not
a, and does not require a, full-time commitment by Bullock.

     1.3 Bullock covenants that he shall:

     a. Perform the Services with due diligence and reasonable care;

     b. Keep the Company currently informed on matters arising under or
pertaining to the Services;

     c. Maintain and furnish to the Company upon request accurate and complete
records of any reimbursed expenses; and

     d. Comply in all material respects with all applicable federal, state and
local laws, rules and regulations in the performance of the Services.

     1.4 Bullock's relationship in the provision of Services under this
Agreement shall be construed solely to be that of an independent contractor.

     2.0 COMPENSATION

     2.1 In consideration for Bullock's performance of Services, effective as of
January 1, 2001, the Company shall pay and/or provide:

     a. Two thousand dollars ($2,000.00) per month in base compensation paid
through and including the month of December 2006 (in the event of the untimely
death of Bullock prior to December 2006, such compensation shall be paid to his
spouse through that date), and one thousand dollars ($1,000.00) per month
thereafter (payable to his spouse for the remainder of her life in the event
Bullock is survived by his spouse) (for purposes of this Agreement, Bullock's
spouse shall mean Edith Bullock, the person to whom he is married as of the date
of this Agreement);

     b. Benefits in form and substance identical or equivalent to all employment
benefits (including health insurance, dental insurance, life insurance, extended
care insurance, and disability insurance) now or hereafter offered to executive
officers of the Company and/or the


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Bank through and including the month of December 2006 (in the event of the
untimely death of Bullock prior to December 2006, such benefits shall be
provided to his spouse through that date);

     c. Use of a new leased vehicle every two years through December 2006, such
vehicle to be equivalent or similar to the vehicle currently leased and provided
to Bullock;

     d. Use of a gasoline credit card and long distance telephone card of the
Company or Bank through December 2006; and

     e. Legal, investment banking, and related and associated fees and expenses
incurred by the Trust and/or Bullock, his spouse, or one or more of his children
or grandchildren, in the process of liquidating its, his, her or their ownership
of stock in the Company, through a secondary underwriting, to the extent such
payment by the Company is not inconsistent with any otherwise applicable
federal, state, or local law (including common law) or regulation, or with the
Articles of Incorporation and Bylaws of the Company or the Bank, and provided
Bullock is not in material breach of this Agreement.

     2.2 For his services as a member of the Board of Directors of the Company
and/or the Bank, Bullock will in addition receive any and all directors' fees
and other compensation or reimbursements (for travel or otherwise) provided
generally to non-Bank employee Directors of the Company and/or the Bank.

     3.0 SERVICE ON THE BOARD OF DIRECTORS OF THE BANK AND THE COMPANY

     3.1 To the extent not inconsistent with any otherwise applicable federal,
state, or local law (including common law) or regulation, or with the Articles
of Incorporation and Bylaws of the Company or the Bank, and for so long as
Bullock is not in material breach of this Agreement, the Company agrees that it
will re-elect Bullock to serve additional successive one-year terms as a member
of the Board of Directors of the Bank until the first annual meeting of the
shareholders of the Bank following Bullock's seventieth birthday.

     3.2 To the extent not inconsistent with any otherwise applicable federal,
state, or local law (including common law) or regulation, or with the Articles
of Incorporation and Bylaws of the Company or the Bank, and for so long as
Bullock is not in material breach of this Agreement, the Company agrees that it
will affirmatively recommend to its Nominating and Directors Committee (the
"Committee") that the Committee nominate Bullock for re-election to the Board of
Directors of the Company, pursuant to Article VI, Section 8, of the Bylaws of
the Company, upon the expiration of Bullock's present term and each succeeding
term as a member of the Board of Directors of the Company, until the first
annual meeting of the shareholders of the Company following Bullock's seventieth
birthday.

     3.3 To the extent not inconsistent with any otherwise applicable federal,
state, or local law (including common law) or regulation, or with the Articles
of Incorporation and Bylaws of the Company or the Bank, in the event that (i)
Bullock is no longer serving as a Director of the Bank and (ii) the Trust and
Bullock's immediate family (defined as himself, his spouse, children,


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and grandchildren) combined continue to own more than three percent (3%) of the
Common Stock of the Company, the Company agrees that it will elect a
representative of the Trust or of Bullock's immediate family (whose identity is
made known to the Company by the Trust or family) prior to the annual meeting of
the shareholders of the Bank) as a member of the Board of Directors of the Bank
at each annual meeting of the shareholders of the Bank. The Company agrees that
any representative of the Trust of family so elected who resides outside Maine
shall be reimbursed for all reasonable travel and lodging expenses to attend
meetings of the Board of Directors of the Company and other functions or
meetings as appropriate.

     3.4 To the extent not inconsistent with any otherwise applicable federal,
state, or local law (including common law) or regulation, or with the Articles
of Incorporation and Bylaws of the Company or Bank, the Company agrees that in
the event (i) Bullock is no longer serving as a Director of the Company and (ii)
the Trust and Bullock's immediate family (defined as above) combined continue to
own more than three percent (3%) of the Common Stock of the Company, the Company
agrees that it will affirmatively recommend to the Committee that the Committee
nominate for election to the Board of Directors of the Company, pursuant to
Article VI, Section 8, of the Bylaws of the Company, a representative of the
Trust or of Bullock's immediate family (whose identity is made known to the
Company by the Trust or family prior to the annual meeting of the shareholders
of the Company). The Company agrees that any representative of the Trust or
family elected following such nomination, who resides outside Maine, shall be
reimbursed for all reasonable travel and lodging expenses to attend meetings of
the Board of Directors of the Company and other functions or meetings as
appropriate.

     3.5 Should Bullock cease to reside within twenty-five (25) miles of Bangor,
Maine, he shall be reimbursed by the Company for all reasonable travel and
lodging expenses associated with his attendance at Company and/or Bank Board
meetings and related functions or in connection with the other services to be
provided pursuant to this agreement, provided that such reimbursement shall not
exceed $10,000 in any twelve (12) month period unless approved by the Bank
and/or Company.

     4.0 TERM

     4.1 Unless earlier terminated by mutual consent of the parties, this
Agreement shall terminate on the later to occur of (i) Bullock ceasing to serve
as a member of the Board of Directors of both the Company and the Bank, (ii) the
ceasing of the Trust, and/or Bullock's immediate family (as defined above)
combined, to own more than three percent (3%) of the Common Stock of the
Company, and (iii) the death of Bullock's spouse.

     5.0 MISCELLANEOUS

     5.1 This Agreement shall be governed by and construed in accordance with
the laws of the State of Maine.

     5.2 The Trust, Bullock's spouse, and the remainder of Bullock's immediate
family (as defined above) are intended third-party beneficiaries of this
Agreement.


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     5.3 The waiver by either party of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent
breach. No waiver shall be valid or effective unless in writing and signed by
the party against whom waiver is being asserted.

     5.4 Bullock acknowledges that the services to be rendered by him are unique
and personal. Accordingly, Bullock may not assign any of his rights or delegate
any of his duties or obligations under this Agreement. This Agreement shall be
and is intended to be binding on, and shall inure to the benefit of, the Company
(whether or not a controlling interest of its Common Stock is acquired by any
person or persons who do not currently own a controlling interest), any person
who purchases, directly or indirectly, substantially all of the assets of the
Company or the Bank, and the Company's successors or assigns, through
reorganization, merger, or any other form of transaction.

     5.5 The invalidity or unenforceability of any term or provision of this
Agreement shall not affect the validity or enforceability of any other term or
provision of this Agreement.

     5.6 This Agreement may be executed in any number of counterparts, each of
which will be deemed an original, but all such counterparts together will
constitute but one Agreement.

     5.7 The terms and provisions contained in this Agreement constitute the
entire Agreement between the parties with respect to the subject matter hereof.
This Agreement supersedes all previous communications, representations or
Agreements, either verbal or written, between the parties.

                                    MERRILL MERCHANTS BANCSHARES, INC.


                                    By   /s/ EDWIN N. CLIFT
                                      ------------------------------------------
                                      Edwin N. Clift, President

                                        /s/ WILLIAM C. BULLOCK, JR.
                                      -----------------------------------------
                                      WILLIAM C. BULLOCK, JR.