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                                                                 EXHIBIT 10 AQ

                              EMPLOYMENT AGREEMENT

                 THIS AGREEMENT made as of the l8th day of March, 1996, by and
among George Mason Bankshares, Inc., a Virginia corporation (the
"Corporation"), and Webb C. Hayes, IV of Bethesda, Maryland (the "Executive")
and The Palmer National Bank, a national bank.

                                   WITNESSETH

                 WHEREAS, the Corporation and Mason Holdings Corporation, a
Virginia corporation and wholly owned subsidiary of the Corporation ("MHC"),
have entered into an Agreement and Plan of Reorganization, dated as of October
19, 1995, among the Corporation, MHC, The Palmer National Bancorp, Inc.
("PNBI"), a Delaware corporation, The Palmer National Bank, a national bank
(the "Bank") and Palmer National Mortgage, Inc., a Delaware corporation
("PNMI"), both the Bank and PNMI being wholly owned subsidiaries of PNBI (the
"Agreement and Plan"), pursuant to which PNBI will be merged with and into MHC
(the "Merger");

                 WHEREAS, the Executive currently serves as President and Chief
Executive Officer of PNBI and Chaimnan, President and Chief Executive Officer
of the Bank;

                 WHEREAS, the Executive is currently subject to an Executive
Compensation Agreement made as of January 31, 1988 by and between the Executive
and the Bank (the "Palmer Employment Agreement");

                 WHEREAS, it is a condition to the parties obligations under
the Agreemnent and Plan to Consummate the Merger that Executive enter into an
employment agreement with


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the Corporation at or prior to the Effective Time of the Merger (as such term
is defined in Section 1.3 of the Agreement and Plan);

                 WHEREAS, the Corporation, the Executive and the Bank desire
that the Palmer Employment Agreement be terminated at the Effective Time of the
Merger; and

                 WHEREAS, the Corporation desires to emplov Executive, and the
Executive desires to become an employee of the Corporation, on the terms and
conditions set forth herein;

                 NOW THEREFORE, in consideration of the mutual covenants
contained herein, the Corporation and the Executive agree as follows:

                 1.          Employment.  Effective on the Effective Date, the
Corporation and the Bank agree to employ the Executive and Executive agrees to
be employed by the Corporation and the Bank on the terms and conditions
hereinafter set forth.

                 2.          Capacity.  Effective on the Effective Date, the
Executive shall be appointed and serve as Executive Vice President of the
Corporation and shall be appointed and serve initially as President and Chief
Executive Officer of the Bank and shall perform services for the Corporation
and the Bank consistent with such positions (or such other positions if
appointed), including, initially, his continuing to manage marketing, service
and business development activities for the customers and prospects of the Bank
or any successor bank or business division of the Bank or the Corporation.
Executive's title, duties and responsibilities may be changed or expanded
during the term of Executive's employment hereunder and Executive's reporting
relationships to other officers of the Corporation, MHC and the Bank may also
be modified by the Chief Executive Officer of the Corporation; however, there
will be no material decrease in Executive's duties and responsibilities
hereunder as an executive officer of the Corporation.





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                 3.          Effective Date and Term.  The commencement date
(the "Effective Date") of this Agreement shall be the day in which the
Effective Time of the Merger occurs.  Effective on the Effective Date, the
Palmer Employment Agreement shall be terminated and be of no further force and
effect.  Subject to the provisions of Sections 6, 7 and 13(b), the term of the
Executive's employment hereunder shall be for one year from the Effective Date;
and the term shall be automatically extended from day to day so that on any day
the remaining term shall be one year.

                 4.          Compensation and Benefits.  This Agreement does
not affect any compensation or benefits earned by the Executive, that remain
unpaid on the Effective Date, pursuant to the Palmer Employment Agreement.  The
compensation and benefits payable to the Executive under this Agreement shall
be as follows:

                             (a)     Base Salary.  The Bank shall pay the
Executive a Base Salary of One Hundred Ninety Five Thousand Dollars
($195,000.00) per year, which shall be inclusive of all meeting and directors'
fees and shall be the sole compensation for all services rendered by the
Executive except as otherwise provided in this Agreement.  The Executive's
Base Salary could be subject to merit based increase from time to time in
accordance with the usual practice of the Corporation with respect to the
review of compensation of its senior executives.  The Executive's Base Salary
shall be payable in periodic installments in accordance with the Bank's and the
Corporation's usual practice for their senior executives.

                             (b)     Bonus Compensation.  In addition to Base
Salary, the Executive will be eligible to be paid an incentive bonus by the
Bank under the Corporation's annual incentive bonus plan offered by the
Corporation for its senior executives, in which annual bonuses will be
determined by the Compensation Committee of the Board of the Corporation based
upon (i) the Executive satisfying performance goals for the Bank agreed to in
writing by the Executive, the Chief Executive Officer of the Corporation, and





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the Compensation Committee of the Board and (ii) the overall financial results
of the Corporation for such year.

                             (c)     Executive's Individual Benefits.  After
the Effective Date, the Bank will make every reasonable effort to continue in
force and pay the premiums on the two individual long term disability insurance
policies being maintained by the Bank for the benefit of Executive as in effect
on October 19, 1995.  The Bank shall also continue to pay all premiums with
respect to the policy insuring the Executive's life which is owned by the
trustee of that trust agreement as in effect on October 19, 1995 which has been
established to provide for benefits under certain supplemental retirement
benefits agreements between the Bank and certain of its executives.  The Bank
shall also continue to pay premiums on the two policies insuring the
Executive's life, purchased pursuant to certain split-dollar life insurance
plan ageements as in effect on October 19, 1995.  Notwithstanding the above,
the Executive acknowledges and agrees that after the Effective Date the above
described individual benefits presently maintained by the Bank for him may be
converted into substantially equivalent benefits which are not materially less
favorable for Executive under substantially similar benefit plans adopted by
the Corporation or its subsidiaries' for the benefit of senior executives.

                             (d)         Regular Benefits.  The Executive also
shall be entitled to participate in any and all employee benefit plans, medical
insurance and health plans, retirement plans, and other benefit plans from time
to time in effect for senior executives of the Bank.  Such participation shall
be subject to (i) the terms of the applicable plan documents, (ii) generally
applied policies of the Bank and (iii) the termination rights of the
Corporation and its subsidiaries after the Effective Date (pursuant to Section
7.4(a) of the Agreement and Plan) with respect to Bank employee benefit plans.
Executive shall be eligible to receive stock options awarded through
participation in Stock Option Plans administered by the Corporation's
Compensation Committee of the Board and entitled to participate in any
Employee Stock Purchase Plans maintained by the Corporation in accordance with
their terms.





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                             (e)     Business Expenses.  The Bank shall
reimburse the Executive for all reasonable travel, entertainment and other
business expenses incurred by him in the performance of his duties and
responsibilities hereunder, subject to audit as necessary and to such
reasonable requirements with respect to substantiation and documentation as
may be specified by the Corporation.

                             (f)     Vacation.  The Executive shall be entitled
to the same vacation benefits which is currently three (3) weeks of vacation
per year, including unused vacation carry over rights for one (1) week, as
other executives of the Corporation based on years of service (including years
of service at the Bank) to be taken at such times and intervals as shall be
determined by the Executive with the approval of the Corporation (which may act
through its Chief Executive Officer or Compensation Committee), which approval
shall not be unreasonably withheld.

                             (g)     Automobile.  The Bank at its sole cost
shall during the term of this Agreement provide the Executive with the use of
an appropriate automobile that shall be selected by the Executive with the
approval of the Corporation, which shall not be unreasonably withheld, so long
as such selection is consistent with prior Bank practices.

                 5.          Extent of Service.  During his employment
hereunder, the Executive shall, subject to the direction and supervision of the
Chief Executive Officer of the Corporation, devote his full business time, best
efforts and business judgment, skill and knowledge to the advancement of the
Bank's and the Corporation's interests and to the discharge of his duties and
responsibilities hereunder.  He shall not engage in any other business activity,
except as may be approved by the Chief Executive Officer of the Corporation;
provided, however, that nothing herein shall be construed as preventing the
Executive from:

                             (a)     investing his assets in a manner not
prohibited by Section 8, and in such form or manner as shall not require any
material srvices on his part in the operations or affairs of the companies or
other entities in which such investments are made;





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                             (b)     serving on the board of directors or
governing board of any entity subject to the prohibitions set forth in Section
8 and provided that he shall not be required to render any material services
with respect to the operations or affairs of any such entity and subject to
disclosure and advance approval by the Chief Executive Officer and the Board of
Directors of the Corporation, which approval will not be unreasonably withheld,
as well as annual notification to the Chief Executive Officer and Board of
Directors of the Corporation as to all boards on which Executive serves; or

                             (c)     engaging in religious, charitable or other
community or non-profit activities which do not impair his ability to fulfill
his duties and responsibilities under this Agreement.

                 6.          Termination and Termination Benefits.
Notwithstanding the provisions of Section 3, the Executive's employment
hereunder shall terminate under the following circumstances:

                             (a)     Death.  In the event of the Executive's
death while he is actively employed by the Corporation, the Executive's
employment shall terminate on the date of his death; all compensation and
benefits earned by the Executive but unpaid at the time of his death shall be
paid to the Executive's estate.

                             (b)     Termination by the Corporation for Cause.
The Executive's employment hereunder may be terminated for "Cause" by the
Corporation, which shall mean termination because of the Executive's breach of
fiduciary duty involving personal profit, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses) or entry of a
final cease-and-desist order relating to the Bank, or acts or omissions
constituting dishonesty, fraud, or disreputable conduct, or gross negligence in
the course of his employment, or willful misconduct in the performance of his
duties hereunder, including willful failure to perform such duties as may
properly be assigned to him hereunder, provided however, that such
determination of termination for Cause shall require the affirmative vote of a
majority of the members of the Corporation's Board of Directors.  For purposes
of this paragraph, no act or failure to act on the Executive's part





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shall be considered "willful" unless done, or omittcd to be done, by the
Executive not in good faith and without reasonable belief that the Executive's
action or omission was in the best interests of the Corporation.

                 In the event of termination for Cause, all obligations of the
Corporation and the Bank under this Agreement shall terminate as of the date
the Executive's employment is terminated, except that all compensation and
benefits earned by the Executive but unpaid at the time of his termination will
be paid to Executive.

                             (c)     Termination by the Corporation Without
Cause.  The Executive's employment with the Corporation may be terminated
without Cause upon written notice by the Chief Executive Officer of the
Corporation to Executive.  Termination without Cause is defined as termination
for any reason other than the terminations specified in other lettered
paragraphs of this Section 6, all as defined in this Agreement.

                 In the event of termination without Cause, all obligations of
the Corporation and its subsidiaries under this Agreement shall terminate as of
the date the Executive's employment is terminated, except that:

                             (i)     the Bank shall continue to pay the
Executive his Base Salary at the rate in effect on the date of termination for
a period of twelve (12) months from the date of such termination.  Neither the
Bank, nor the Corporation, nor any of their subsidiaries shall have any
obligation to pay Executive any portion of a bonus that might otherwise have
been earned during such period had Executive remained an employee;

                             (ii)    all compensation and benefits earned by
the Executive but unpaid at the date of his termination will be paid to
Executive;

                             (iii)   unless earlier terminated, the Bank will
continue to pay premiums on the long term disability insurance policies and the
life insurance policy funding the supplemental retirement benefits agreement
referenced in Section 4(c) for twelve (12) months from the date of termination.
Thereafter, responsibility for premium payments with respect to the long term
disability insurance policies will be transferred to





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the Executive and payment will be commenced under the supplemental retirement
benefits agreement only if payment is due under the terms thereof. Unless
earlier terminated, the Bank will continue to pay premiums on the life
insurance policies funding the split-dollar agreements referenced in Section
4(c) for a period of twelve (12) months from the date of termination, at which
time the policies shall be permitted to lapse or transferred in accordance
with the provisions of the split-dollar agreements; and

               (iv)   the Bank will use reasonable commercial efforts to
provide the Executive with continued coverage or twelve (12) months from the
date of termination under the Bank's employee group plans for health, life and
disability at the same level of participation enjoyed by Executive on the date
of termination. The health coverage provided hereunder shall count towards the
Executive's right to continuation coverage under the federal law known as
COBRA, to the extent permitted by law. Executive acknowledges and agrees that
his participation in stock option or stock purchase plans, bonus plans and any
retirement plans which are "qualified" under Section 401(a) of the Internal
Revenue Code will cease on the date of termination.   

        (d)    Termination by Operation of Law. The Executive's employment
shall terminate:

               (i)    if the Executive is removed and/or permanently prohibited
from participating in the conduct of the affairs of the Corporation or its
subsidiaries by a final order issued by any financial institution regulatory
body, including but not limited to the Federal Reserve Board, the Office of the
Comptroller of the Currency, the Federal Deposit Insurance Corporation or any
state financial institution regulator as of the effective date of the order; or

               (ii)   if the Executive is removed and/or permanently
prohibited from participating in the conduct of the affairs of the Corporation
or its subsidiaries under, or such removal is required to comply with, any
final judicial decree or order.





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       In the event of termination by Operation of Law, all obligations of the
Corporation or its subsidiaries under this Agreement shall terminate as of the
date indicated, except that all compensation and benefits earned by the
Executive but unpaid at the time of his termination will be paid to Executive.

           (e)    Termination by Disability. The Executive's employment may be
terminated in the event that he is unable to perform the essential duties of
his position due to any mental, physical or other disability. The Executive may
only be terminated under this provision if he remains unable to perform the
essential functions of his position following a leave of absence because of
disability for a period of twenty six (26) weeks and either (i) the Board of
Directors of the Corporation thereafter concludes, based upon medical and other
evidence satisfactory to it, that the Executive is disabled within the meaning
of this provision or (ii) the issuing carrier under any group or individual
long term disability plan or policy paid for or maintained by the 
Corporation or its subsidiaries determines that the Executive is disabled under
the terms of such plan or policy. During the twenty-six (26) week period prior
to termination for disability, the Executive will receive full Base Salary
reduced by the amount of disability benefits provided under any disability
insurance paid for or maintained by the Corporation or its subsidiaries.  If
disability benefits have not commenced at the time of termination for
disability under any such long term disability insurance, such full Base Salary
shall continue until the time any such disability benefits commence. The
Corporation will make reasonable accommodation to the known physical and mental
limitations of the Executive unless to do so would cause the Corporation undue
hardship. The Executive may, and at the request of the Corporation will. submit
to the Corporation a certification of his medical condition and prognosis, in
reasonable detail by a physician or physicians satisfactory to the
Corporation. All obligations of the Corporation or its subsidiaries under this
Agreement, except for the Base Salary continuation provided under this
paragraph, shall terminate as of the date the Executive's employment is
terminated under this provision, except that all compensation and benefits
earned by the Executive but unpaid at the time of his termination will be paid
to Executive.





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            (f)    Termination by Reason of Retirement or Voluntary
Resignation. In the event of the Executive's retirement or his voluntary
resignation, this Agreement will terminate on the date Executive retires or
voluntarily resigns from employment and all obligations of the Corporation or
its subsidiaries under this Agreement will terminate as of that date; provided,
however, that Executive will be entitled to receive any salary and benefits
earned but unpaid as of the date of his retirement or resignation.

            (g)    Resignation by Reason of Corporation's Material Breach. In
the event of Executive's resignation due to a material breach of this Agreement
by the Corporation (determined by arbitration pursuant to Section 12), then the
Corporation's obligations under this Agreement are the same as those for a
Termination Without Cause under Section 6(c).  Executive's letter of
resignation: shall set forth in specific detail the material breach alleged to
have compelled his resignation in order for this subparagraph to apply to any
resignation.

            (h)    Resignation as Director. Upon notice to Executive that
Executive's employment with the Corporation is terminated hereunder for any
reason, he hereby agrees to resign immediately as director of the Corporation,
the Bank, or any subsidiary or entity affiliated with either upon whose board
of directors he is a member, effective upon the date of termination of
employment. The Executive hereby agrees that the Corporation shall have the
right to suspend any payments to or on behalf of Executive under this Agreement
until this provision is complied with by Executive.

     7.     Suspension of Agreement.  Notwithstanding the provisions of Section
3, the Executive's employment hereunder and the Corporation's obligations under
this Agreement shall be suspended if the Executive is suspended and/or
temporarily prohibited from participating in the conduct of the Corporation's
or any subsidiary's affairs by a notice served by any financial institution
regulatory body including but not limited to the Federal Reserve Board, the
Office of the Comptroller of the Currency, the Federal Deposit Insurance
Corporation or any state financial institution regulator or any other judicial,
executive or agency decree, order, judgment or ruling as of the date of





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service thereof unless stayed by appropriate proceedings. If the charges in the
notice are dismissed, the Corporation shall (i) pay the Executive the
compensation withheld while the Agreement was suspended pursuant to this
Section and (ii) reinstate any of its obligations which were suspended.

    8.    Noncompetition and Confidential Information.

          (a)    Noncompetition.   For a period of twelve (12) months following
the termination of his employment under this Agreement for any reason, the
Executive will not, directly or indirectly, whether as owner, partner,
shareholder, consultant, agent, employee, co-venturer or otherwise, or through
any Person (as such term is defined in Section 10 hereof), compete in any city
or county in the Commonwealth of Virginia, any city or county in Maryland or in
the District of Columbia where the Corporation and its subsidiaries maintain
(or have applied for) offices or branches at the time of the Executive's
termination and at any time during the period this Noncompetition provision is
in effect, with the banking or any other business conducted by the Corporation
and its subsidiaries during the period of his employment hereunder, nor will he
attempt to hire any employee of the Corporation or its subsidiaries, assist in
such hiring by any other Person, encourage any such employee to terminate his
or her relationship with the Corporation or its subsidiaries or solicit or
encourage any customer of the Corporation or its subsidiaries to terminate its
relationship with the Corporation or any subsidiary or to conduct with any
other Person any business or activity which such customer conducts with the
Corporation or its subsidiaries. Notwithstanding anything to the contrary
contained herein, the Executive shall be permitted to invest his assets in any
corporation, firm or entity which may be deemed to compete with the
Corporation, and/or its subsidiaries, within the meaning of this Section 8(a),
provided that the Executive does not become the beneficial owner (as such term
is defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934)
of more than five percent (5%) of the outstanding voting stock of any such
corporation, firm or entity.   





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          (b)    Confidential Information. The Executive will not at any time
disclose to any other Person (except as required by applicable law or in
connection with the performance of his duties and responsibilities hereunder),
or use for his own benefit or gain, any confidential information of the
Corporation and its subsidiaries obtained by him incident to his employment.
The term "confidential information" includes, without limitation, financial
information, trade secrets, business plans and opportunities (such as lending
relationships, financial product developments or possible acquisitions or
dispositions of businesses or facilities) which have been discussed or
considered by the management of the Corporation and its subsidiaries but does
not include any information which has become part of the public domain by means
other than the Executive's nonobservance of his obligations hereunder. Upon the
effective date of any notice by the Executive or the Corporation to terminate
this Agreement, or at any time upon the request of the Corporation, the
Executive (or his heirs or personal representatives) shall deliver to the
Corporation (i) all documents and materials containing confidential information
and (ii) all documents, materials or other property belonging to the
Corporation or its subsidiaries, which in either case are in the possession or
under the control of the Executive (or his heirs or personal representatives.)

          (c)    Relief Interpretation. The Executive agrees that a breach of
this Section 8 will irreparably and continually damage the Corporation and that
the Corporation shall be entitled to injunctive relief for any breach by him of
the covenants contained in this Section 8, in addition to any other remedy
provided by law. Breach of this Section 8 by the Executive will result in the
cessation of any payments to or on behalf of Executive under Section 6 of this
Agreement, and the Corporation may elect to suspend such payments in the event
of breach, pending final determination of the merits of the dispute by a court
of competent jurisdiction. The parties agree that the prevailing party will be
entitled to recover the reasonable attorneys' fees and court costs incurred by
such party in the course of prosecuting or defending any lawsuit brought under
Section 8 of this Agreement.
          




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          (d)   Modification of Agreement. This Section 8 is intended to limit
the Executive's right to compete only to the extent necessary to protect the
Corporation and its subsidiaries from unfair competition. The Executive
acknowledges that the above covenants are manifestly reasonable on their face,
and the parties expressly agree that such restrictions have been designed to be
reasonable and no greater than is required for the protection of the
Corporation and its subsidiaries. In the event that any provision of this
Section 8 shall be determined by a court of competent jurisdiction to be
unenforceable for any reason, a court or other trier of fact may modify and
enforce the covenant to the extent it is reasonable under the law and the
circumstances existing at that time.

          (e)    Survival of Restrictions. The provisions of this Section 8
will survive the termination of this Agreement and the termination of
Executive's employment with the Corporation, regardless of the reasons for
termination.

    9.     Conflicting Agreements. The Executive hereby represents and warrants
that except for the Palmer Employment Agreement, he is not a party to any
other employment or compensation agreement, that performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which
he is a party or is bound, and that he is not subject to any covenants
against competition or similar covenants which would affect the performance of
his obligations hereunder.

    10.    Definition of "Person." For purposes of this Agreement, the term
"Person" shall mean an individual, a corporation, an association, a
partnership, an estate, a limited liability company, a trust and any other
entity or organization.

    11.    Withholding. All payments made by the Corporation or its
subsidiaries under this Agreement to Executive or on Executive's behalf shall
be reduced by any tax or other amounts required to be withheld under applicable
law.

    12.    Arbitration of Disputes. With the exception of any dispute arising
under Section 8 of this Agreement, any controversy or claim arising out of or
relating to this





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Agreement or the breach thereof shall be settled by arbitration in accordance
with the laws of the Commonwealth of Virginia by three arbitrators, one of whom
shall be appointed by the Corporation, one of whom shall be appointed by the
Executive, and the third of whom shall be appointed by the first two
arbitrators. If the first two arbitrators cannot agree on the appointment of a
third arbitrator, then the third arbitrator shall be appointed by the American
Arbitration Association. Such arbitration shall be conducted in the County of
Fairfax, Virginia, or in such other locations as the parties may agree, in
accordance with the rules of the American Arbitration Association, except with
respect to the selection of arbitrators which shall be as provided in this
Section 12. The decision of the arbitrators will be final and binding. Judgment
upon the award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.

    13.    Assignment; Binding Agreement; Successors.

           (a)    Neither the Corporation nor the Executive may make an
assignment of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other party hereto, and
without such consent, any attempted transfer or assignment shall be null and of
no effect. This Agreement shall inure to the benefit of and be binding upon the
Corporation and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.  In the event of the Executive's
death prior to the completion by the Corporation of all payments due him under
this Agreement, the Corporation shall continue such payments to the Executive's
beneficiary or to his estate, as appropriate.

           (b)    This Agreement will remain binding upon any successor Person
who acquires all or substantially all of the business or assets of the
Corporation (whether by merger, reorganization, consolidation, liquidation,
sale of substantially all of its assets or otherwise). The Corporation will
require and such successor Person, to expressly assume and agree in writing to
perform this Agreement in the same manner and to the same extent that the
Corporation would be required perform it if no succession had taken place.
Failure of the Corporation to obtain such assumption in writing, shall be





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treated for purposes of this Agreement as a Termination Without Cause under
Section 6(c). Failure of the Executive to consent to the assumption of this
Agreement by such successor Person shall be treated for purposes of this
Agreement as a voluntary resignation under Section 6(f). In either event, the 
date on which any such succession becomes effective will be deemed the date of
termination of employment.

    14.    Exclusivity of Benefits. The specific arrangements referred to
herein are not intended to exclude any other benefits which may be available
to the Executive upon a termination of employment with the Corporation pursuant
to employee benefit plans generally available to all employees of the
Corporation or its subsidiaries; notwithstanding this provision, however, the
parties agree that there will be no duplication of benefits in the case of
salary continuation or severance plans. ConsequentlY, any compensation or
benefits to which Executive is entitled upon termination under any generally
available salary continuation or severance benefit plan, policy or practice
will be offset against the specific compensation and benefits payable under
this Agreement.

    15.   Enforceability. If any portion or provision of this Agreement shall
to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the applications of such
portion or provision in circumstances other than those as to which it is
so declared illegal or unenforceable, shall not be affected thereby, and each 
portion and provision of this Agreement shall be valid and enforceable to the 
fullest extent permitted by law.

    16.    Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the 
waiver by any party of any breach of this Agreement, shall not prevent any 
subsequent enforcement of such term or obligation or be deemed a waiver of any 
subsequent breach.

    17.    Notices. Any notices, requests, demands and other communications
required by this Agreement shall be sufficient if in writing and delivered in
person, by





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overnight delivery, or sent by registered or certified mail, postage prepaid,
to the Executive at the last address the Executive has filed in writing with
the Corporation or, in the case of the Corporation or the Bank, at their
respective main offices, to the attention of their Chief Executive Officer.

    18.   Indemnification. To the extent consistent with any general liability
or directors' and officers' insurance policies in effect during the term of
this Agreement, and as permitted by applicable law, the Corporation shall
indemnify, hold harmless and defend the Executive for all acts or omissions
taken or not taken by him in good faith while performing services for the
Corporation or its subsidiaries to no lesser extent than, and upon the same
terms and conditions as, other similarly situated officers of the Corporation.
If and to the extent that the Corporation maintains, at any time during the
term of this Agreement, a liability insurance policy covering the other
officers and directors of the Corporation, the Corporation shall use its best
effects to cause the Executive to be covered under such policy upon the same
terms and conditions as other similarly situated officers and directors.

    19.    Regulatory Prohibition. Notwithstanding any other provision of this
Agreement to the contrary, any payments made to the Executive pursuant to this
Agreement, or otherwise, will not be made or shall be returned promptly by the
Executive, if required, if the Federal Deposit Insurance Corporation (FDIC) or
any other enforcement authority, finds that the payments violate Section 18(k)
of the Federal Deposit Insurance Act, as amended (12 U.S.C. Section 1828 (k))
and any final rules and regulations promulgated thereunder.

    20.    Amendment. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by duly authorized
representatives of the Corporation.





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    21.    Governing Law. This Agreement shall be construed under and be
governed in all respects by the laws of the Commonwealth of Virginia, to the
extent not preempted by Federal law.





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    IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Corporation and the Bank, by their respective duly authorized officers, 
and by the Executive, as of the date first above written.

ATTEST:                              GEORGE MASON BANKSHARES, INC.
                                     
  [SIG]                              By:    Bernard H. Clineburg
------------------------                -----------------------------------
Secretary                            Title: President
                                           --------------------------------
                                     
[Seal]                               
                                     
WITNESS:                             WEBB C. HAYES, IV
[SIG]                                [SIG]
------------------------             --------------------------------------
Name                                 
                                     
                                     
ATTEST:                               THE PALMER NATIONAL BANK
[SIG]                                 By: [SIG]
------------------------                 ----------------------------------
Secretary                             Title: S.V.P
                                            -------------------------------

[Seal]





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