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                                                                   EXHIBIT 10.22

                             EMPLOYMENT AGREEMENT

          THIS AGREEMENT (the "Agreement") entered into as of March 17th, 2000,
by and among NATIONAL BANK OF COMMERCE, a national banking association (the
"Bank"), NATIONAL COMMERCE BANCORPORATION, a Tennessee corporation (the
"Company"), and THOMAS M. GARROTT ("Employee").



                               R E C I T A L S:

          WHEREAS, the Board of Directors of the Company has determined that it
is in the best interests of the Company and its shareholders to assure that the
Company will have the continued dedication of the Employee pending the
consummation of the transactions (the "Merger") contemplated among the Company
and CCB Financial Corporation, a North Carolina corporation ("CCB"), pursuant to
the Agreement and Plan of Merger dated as of March 17, 2000 between the Company
and CCB (the "Merger Agreement") and to provide the surviving corporation after
the Merger with continuity of management. Therefore, in order to accomplish
these objectives, the Board of Directors of the Company has caused the Company
to enter into this Agreement.

          In consideration of the foregoing, the mutual provisions contained
herein, and for other good and valuable consideration, the parties agree to
enter into this Agreement and to agree with each other as follows:

     1.   EMPLOYMENT

          A.   Position and Duties.  While employed by the Company, the Employee
               -------------------
shall serve as Chairman of the Board of Directors of the Company, with the
authority, duties and responsibilities commensurate with such position. While
employed by the Company and until such time as the Employee retires from service
on the Board of Directors of the Company, the Employee shall serve as Chairman
of the Executive Committee of the Board of Directors of the Company. While
employed by the Company, the Employee's services shall be performed in Memphis,
Tennessee.


          B.   The Employee shall not, during the term of his employment under
this Agreement, be engaged in any other activities if such activities interfere
materially with the Employee's is current duties, authority and responsibilities
for the Company, except for those other activities as shall hereafter be carried
on with the Company's consent. The Employee shall be entitled to carry on those
activities as have heretofore been carried on with the Company's consent,
including, without limitation, making and managing his personal investments,
provided such investments or other activities do not violate in any material
respect the terms of Sections 6, 7 or 8 hereof.

     2.   TERM

          A.   The "Effective Date" shall mean the "effective time" of the
Merger as defined in the Merger Agreement. Subject only to the provisions of
either Section 3(G) or Section
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4 hereof, the "term" of the Employee's employment under this Agreement shall be
for the period commencing on the Effective Date and ending on the third
anniversary thereof. The expiration of the term of this Agreement shall in no
way limit or otherwise affect adversely any of the Employee's or his spouse's
rights in or entitlements to benefits provided to the Employee or his spouse
pursuant to Sections 4(D)(iii) (as it relates to stock incentive plans), 4(H),
and 5(A) (as it relates to stock incentive plans) of this Agreement.

     3.   COMPENSATION

          For all services rendered by the Employee while on active status under
this Agreement, the Company agrees to compensate the Employee for each
compensation year (January 1 through December 31) during the term hereof, as
follows:

          A.   Base Salary.  A base salary shall be payable to the Employee by
               -----------
the Company as a guaranteed annual amount under this Agreement equal initially
to the sum of $650,000.00 per year (the "Base Salary"), which shall be payable
in intervals consistent with the Company's normal payroll schedules (but in no
event less than semi-monthly). The Base Salary shall be subject to being
increased (but not decreased or adjusted other than as provided in Section 4 of
this Agreement) in the sole discretion of the Board of Directors of the Company
but only in such form and to such extent as the Board of Directors may from time
to time approve. The official action of the Board of Directors increasing the
Base Salary payable to the Employee shall modify the amount of Base Salary
stated in this Section 3(A).

          B.   Other Compensation.  The Employee shall be entitled to
               ------------------
participate in any incentive or supplemental compensation plan or arrangement
instituted by the Company and covering its principal executive officers and to
receive additional compensation from the Company in such form and to such
extent, if any, as the Board of Directors may in its sole discretion from time
to time specify and determine with respect to the Company's principal executive
officers generally; provided, however, in the event the Employee shall go on
part-time status for any reason, the Employee shall nevertheless be entitled to
be paid pro rata incentive or supplemental compensation for the fiscal year
ending in the compensation year in which the Employee goes on part-time status,
for the number of calendar months during such fiscal year that Employee shall
have been on active status, at the same time, on the same basis and to the same
extent as any of the Company's principal executive officers on active status are
selected by the Board of Directors to receive any incentive or supplemental
compensation award for such fiscal year. The phrase "principal executive
officer" as used in this Agreement shall mean the chief executive officer of the
Company and the other executive officers of the Company who are from time to
time designated as an executive officer by the Board of Directors.

          C.   Special Payment.  Within 10 days after the Effective Date, the
               ---------------
Company shall make a payment to the Employee equal to the payment to which the
Employee would have been entitled to receive under Section 3(D) of the Amended
and Restated Agreement Respecting Employment between the Company, the Bank and
the Employee, dated as of September 1, 1993, as amended from time to time (the
"Prior Agreement"), as if the Employee had given Notice of Exercise (as defined
in the Prior Agreement) immediately following the Effective Date.

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          D.   Incentive Awards.  On the Effective Date, the Company shall grant
               ----------------
the Employee 100,000 shares of restricted common stock of the Company (the
"Restricted Stock") and a stock option to acquire 300,000 shares of the
Company's common stock (the "Option"), in each case pursuant to the terms of the
Company's stock incentive plan (the "Plan"). The Option shall have a ten year
term from the date of grant, without regard to the Employee's earlier
termination of employment. The Option shall have an exercise price equal to the
fair market value of the stock subject thereto on the date of grant. The
Restricted Stock and the Option shall vest in three equal installments, on each
of the first, second and third anniversaries of the Effective Date, provided
that, notwithstanding the foregoing, the Restricted Stock and the Option shall
immediately vest and be exercisable or transferable upon a Change in Control of
the Company following the Effective Date or upon the Employee's termination of
employment (or, as applicable, change in status to part-time) due to his death
or disability, by the Company other than under Sections 4(A)(i) and (ii) or by
the Employee under Section 4(C)(ii). The number of shares of the Restricted
Stock and the number of shares of common stock underlying Option and the
exercise price thereof shall be appropriately and proportionately adjusted
simultaneously with any changes in capitalization or any reorganization of the
Company, as provided for in the Plan.

          E.   Other Benefits.  Except as otherwise expressly provided herein,
               --------------
the Employee shall be entitled to participate in all employee benefit, welfare
and other plans, practices, policies and programs applicable to the Chief
Executive Officer of the Company on a basis no less favorable than that provided
to the Chief Executive Officer of the Company.

          F.   Tax Indemnity.  Should any of the payments of Base Salary, Part-
               -------------
Time Base Salary, other incentive or supplemental compensation, benefits,
allowances, awards, payments, reimbursements or other perquisites (including the
payments provided for under this Section 3(F)), singly, in any combination or in
the aggregate, that are provided for hereunder to be paid to or for the benefit
of the Employee (including, without limitation, the payment provided for in
Section 3(G) hereof) or under any other plan, agreement or arrangement between
the Employee and the Company, be determined or alleged to be subject to an
excise or similar purpose tax pursuant to Section 4999 of the Internal Revenue
Code of 1986, as amended, or any successor or other comparable federal, state or
local tax laws, the Company shall pay to the Employee such additional
compensation as is necessary (after taking into account all federal, state and
local income taxes payable by the Employee as a result of the receipt of such
additional compensation) to place the Employee in the same after tax position
(including federal, state and local taxes) he would have been in had no such
excise or similar purpose tax (or any interest or penalties thereon) been paid
or incurred. The Company hereby agrees to pay such additional compensation
within five (5) business days after the Employee notifies the Company that the
Employee intends to file a tax return which takes the position that such excise
or similar purpose tax is due and payable in reliance on a written opinion of
the Employee's tax counsel (such tax counsel to be chosen solely by the
Employee) that it is more likely than not that such excise tax is due and
payable. The costs of obtaining such tax counsel opinion shall be borne by the
Company, and as long as such tax counsel was chosen by the Employee in good
faith, the conclusions reached in such opinion shall not be challenged or
disputed by the Company. If the Employee intends to make any payment with
respect to any such excise or similar purpose tax as a result of an adjustment
to the Employee's tax liability by any federal, state or local tax authority,
the Company will pay such additional compensation by delivering its cashier's
check payable in such amount

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to the Employee within five (5) business days after the Employee notifies the
Company of his intention to make such payment. Without limiting the obligation
of the Company hereunder, the Employee agrees, in the event the Employee makes
any payment pursuant to the preceding sentence, to negotiate with the Company in
good faith with respect to procedures reasonably requested by the Company which
would afford the Company the ability to contest the imposition of such excise
tax; provided, however, that the Employee will not be required to afford the
Company any right to contest the applicability of any such excise tax to the
extent that the Employee reasonably determines (based upon the opinion of his
tax counsel) that such contest is inconsistent with the overall tax interests of
the Employee. For purposes of this Section 3(F), payments from the Company or
any affiliate or successor shall be treated as payments from the Company.

          G.   (i)  Change in Control -- Operation of Section 3(G).
                    ----------------------------------------------

               (a)  This Section 3(G) shall be effective, but not operative,
immediately upon execution of this Agreement by the parties hereto and shall
remain in effect so long as the Employee remains employed by the Company on
active status or part-time status, but shall not be operative unless and until
there has been a Change in Control, as defined in subsection (i)(b) hereof. Upon
such a Change in Control, this Section 3(G) shall become operative immediately.

               (b)  "Change in Control" shall mean a change in control of the
Company that shall be deemed to have occurred if and when, with or without the
approval of the Board of Directors of the Company incumbent prior to the
occurrence,

                    (1) more than 25% of the outstanding securities entitled to
     vote in elections of directors of the Company shall be acquired by any
     person (as such term is used in Sections 13(d) and 14(d) of the Securities
     Exchange Act of 1934, as amended) other than by any person which includes
     the Employee; or

                    (2) as the result of a tender offer, merger, consolidation,
     sale of assets or contested election, or any combination of such
     transactions, the persons who were directors of the Company immediately
     before the transaction shall cease to constitute a majority of the Board of
     Directors of the Company or of any successor entity.

          (ii) Employee's Rights Upon Change in Control. If, while the Employee
               ----------------------------------------
is employed by the Company on active status or part-time status pursuant to
either Section 4(C)(i), (ii) or (iii) or Section 4(F), a Change in Control (as
defined in subsection (b) of Section 3(G)(i)) occurs, the Employee may, in his
sole discretion, within eighteen (18) months after the date of the Change in
Control twelve (12) months after the date of the Change in Control if he is on
part-time status at the time of the Change in Control), give notice to the
Secretary of the Company that he intends to elect to exercise his rights under
this Section 3(G) (the "Notice of Intention"). The right to give such Notice of
Intention to elect to receive the payment provided for in subsection (iii) of
this Section 3(G) shall continue for eighteen (18) or twelve (12) months from
the date of the Change in Control, respectively, irrespective of any action by
the Company pursuant to Section 4(A)(iii) or Section 4(F) or by the Employee
pursuant to Section 4(C)(ii) or (iii) within such eighteen (18) or twelve (12)
month period. Within thirty (30) days after the Company's

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receipt of the Notice of Intention, the Company shall provide written notice to
the Employee setting forth the Company's computation of the amount that would be
payable pursuant to subsection (iii) of this Section 3(G), accompanied by the
written opinion of the Company's independent certified public accountants
confirming the Company's computation. If the Employee takes exception to the
Company's computation of such amount, the Employee may (but shall not be
prejudiced in his right to later contest the amount actually paid by failure to
do so) give a further written notice to the Company setting forth in reasonable
detail the Employee's exceptions to the Company's computation, accompanied by
the written opinion of the Employee's tax advisor confirming the basis for such
exceptions. Exercise by the Employee of his rights to receive the payment
provided for in Section 3(G)(iii) hereof pursuant to this Section 3(G) shall
only be made by giving further notice to the Secretary of the Company (the
"Notice of Exercise") within six (6) months from the date of the Notice of
Intention.

          (iii) Payment Upon Change in Control.
                ------------------------------

                (a) If the Employee gives the Notice of Exercise described in
subsection (ii) of this Section 3(G) to the Company, the Company shall pay the
Employee a lump sum amount equal to three (3) times the Employee's base amount,
less one dollar ($1.00). The Employee's base amount shall be determined as
defined in Section 280G of the Internal Revenue Code of 1986, as amended (the
"Code"); provided, however, that amounts deferred under the Company's
nonqualified deferred compensation plan shall be included in determining the
base amount. The Company shall, within five (5) business days after the date of
the Notice of Exercise, deliver to the Employee its cashier's check in the
amount payable pursuant to this subsection (iii)(a) of Section 3(G), and payment
of such amount shall terminate the Employee's rights to receive any and all
other payments, rights or benefits pursuant to Sections 3(A), 3(B), 3(E), 4 and
5 of this Agreement, other than any payments, rights or benefits arising (x)
pursuant to Section 3(F), subsection (iii) of Section 3(G), Section 3(H) or
Section 12 of this Agreement, or (y) from any other agreement, plan or policy
which by its terms or by operation of law provides for the continuation of such
payments, rights or benefits after the termination of the Employee's
relationship with the Company.

                (b) Such lump sum payment shall be in addition to and shall not
be offset or reduced by any other amounts payable or that may become payable to
the Employee, or his beneficiaries, by the Company, including, but not limited
to, salary, severance pay, consulting fees, disability benefits, termination
benefits, retirement benefits, life and health insurance benefits, or any other
compensation or benefit payment that is part of any valid previous, current, or
future contract, plan or agreement, written or oral, or any indemnification
payments that may be or become payable to the Employee pursuant to the
provisions of the Company's Certificate of Incorporation, By-laws or otherwise.

                (c) If Employee gives the Notice of Exercise, in addition to the
lump sum payment under paragraph (a) above, the Company shall pay to the
Employee in a lump sum in cash within five (5) business days after the date of
the Notice of Exercise the aggregate of the following amounts:

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                    (1) the sum of (A) the Employee's Base Salary through the
     date of the Notice of Exercise, (B) the product of (x) the highest annual
     bonus paid or payable, including any bonus or portion thereof which has
     been earned but deferred, during the three year period immediately prior to
     the date of the Notice of Exercise (such amount being referred to as the
     "Highest Annual Bonus") and (y) a fraction, the numerator of which is the
     number of days in the current fiscal year through the date of the Notice of
     Exercise, and the denominator of which is 365 and (C) any accrued vacation
     pay, in each case to the extent not theretofore paid; and

                    (2) the amount equal to the excess (without any present
     value discount) of (A) the actuarial equivalent of the benefit under the
     Company's qualified defined benefit retirement plan (the "Retirement Plan")
     (utilizing actuarial assumptions no less favorable to the Employee than
     those in effect under the Company's Retirement Plan immediately prior to
     the Change of Control), and the National Bank of Commerce Supplemental
     Employee Retirement Plan as Amended and Restated (the "SERP") which the
     Employee would receive if the Employee's employment continued for three
     years after the Notice of Exercise assuming for this purpose that all
     accrued benefits are fully vested, and, assuming that the Employee's
     compensation in each of the three years is the Employee's highest Base
     Salary during the three year period immediately preceding the date of the
     Notice of Exercise and the Highest Annual Bonus, over (B) the actuarial
     equivalent of the Employee's actual benefit (paid or payable), if any,
     under the Retirement Plan and the SERP as of the Date of the date of the
     Notice of Exercise; and

               (d)  If the Employee gives the Notice of Exercise, for three
years after the date of the Notice of Exercise, or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy the
Company shall continue to provide welfare benefits (including, without
limitation, medical, prescription, dental, disability, employee life, group
life, accidental death and travel accident insurance plans and programs) to the
Employee and/or the Employee's eligible dependents at least equal to those
provided to the Employee at any time during the 120-day period immediately
preceding the Change in Control or, if more favorable to the Employee, those
provided generally at any time after the Change in Control to other peer
executives of the Company and its affiliated companies; provided, however, that
if the Employee becomes reemployed with another employer and is eligible to
receive medical or other welfare benefits under another employer provided plan,
the medical and other welfare benefits described herein shall be secondary to
those provided under such other plan during such applicable period of
eligibility. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Employee for retiree benefits pursuant to such
plans, practices, programs and policies, the Employee shall be considered to
have remained employed until three years after the Notice of Exercise and to
have retired on the last day, if such period. In addition to, and not in
limitation of, the benefits provided by the foregoing, after termination of the
Employee's employment with the Company, the Company shall at least provide
medical and dental insurance coverage for the Employee and his spouse for their
lifetimes that is comparable to the medical and dental insurance coverage
provided by the Company to its principal executive officers as of immediately
prior to the Effective Date, and the Company shall be entitled to credits for
coverage to the Employee and his spouse provided by Medicare.

                                      -6-
<PAGE>

               (e)  If the Employee gives the Notice of Exercise, the Employee
shall be entitled to the provision of the benefits and services set forth in
Section 4(D)(viii) of the Agreement until the later of (a) the Employee's
attainment of age sixty-five (65) or (b) the Employee ceasing to be on the Board
of Directors of the Company or its successor.

          H.   Employee's Expenses.  All costs and expenses (including
               -------------------
reasonable legal, accounting and other advisory fees) incurred by the Employee
to (i) defend the validity of this Agreement, (ii) contest any determinations by
the Company concerning the amounts payable (or reimbursable) by the Company to
the Employee under this Agreement, (iii) determine in any tax year of the
Employee the tax consequences to the Employee of any amounts payable (or
reimbursable) under Section 3(F) or (D) hereof, or (iv) prepare responses to an
Internal Revenue Service audit of, and to otherwise defend, his personal income
tax return for any year which is the subject of any such audit, or an adverse
determination, administrative proceedings or civil litigation arising therefrom
that is occasioned by or related to an audit by the Internal Revenue Service of
the Company's income tax returns, are, upon written demand by the Employee, to
be promptly advanced or reimbursed to the Employee or paid directly, on a
current basis, by the Company or its successors.

          4.   TERMINATION, PART-TIME STATUS, AND REVISED COMPENSATION, DEATH,
               DISABILITY

               A.   Termination.  The employment of the Employee under this
                    -----------
Agreement, while the Employee is on active status, may be terminated at any time
by the Company, acting through its Board of Directors (and not a committee
thereof),


               (i)    only for cause in the event of (x) the Employee's final
          conviction of a felony crime involving moral turpitude, or (y) the
          Employee's deliberate and intentional continuing refusal to
          substantially perform his duties and obligations under this Agreement
          (except by reason of incapacity due to illness or accident) if he
          shall have either failed to remedy such alleged breach within forty-
          five (45) days from his receipt of written notice from the Secretary
          of the Company demanding that he remedy such alleged breach, or shall
          have failed to take reasonable steps in good faith to that end during
          such forty-five (45) day period and thereafter, provided that there
          shall have been delivered to the Employee a further notice after the
          end of such forty-five (45) day period asserting that the Board of
          Directors has determined that the Employee was guilty of conduct set
          forth in this clause (y), that the Employee has failed to take
          reasonable steps in good faith to remedy such alleged breach, and
          specifying the particulars thereof in detail, and provided further
          that the Employee thereafter shall have received a certified copy of a
          resolution of the Board of Directors of the Company adopted by the
          affirmative vote of not less than three-fourths of the entire
          membership of the Board of Directors at a meeting called and held for
          that purpose and at which the Employee was given an opportunity to be
          heard, finding that the Employee was guilty of conduct set forth in
          this clause (y), that the Employee has failed to take reasonable steps
          in good faith to remedy such alleged breach, and specifying the
          particulars thereof in detail,

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<PAGE>

               (ii)   upon a determination that the Employee has engaged in
          willful fraud or defalcation or other dishonesty involving the funds,
          assets or the operation of the Company, or

               (iii)  for any reason in its sole discretion upon written notice
          to the Employee effective (subject to the provisions of Section
          4(D)(iii) hereof) on the date that the Employee reaches age sixty-five
          (65).

               B.     Termination Payment For Cause.  In the event of
                      -----------------------------
termination of the Employee's employment under this Agreement by the Company
under either Section 4(A)(i) or (ii), the Employee shall only be entitled to
receive the monthly installment of his Base Salary being paid at the time of
such termination and, if applicable, other compensation due hereunder, computed
on a pro rata basis, up to the effective date of such termination.

               C.     (i)  Part-time Status -- Election by Company.  In the
                           ---------------------------------------
event the company shall give the Employee notice of termination of the
Employee's employment under this Agreement pursuant to Section 4(A)(iii), the
Employee shall, subject to the provisions of Section 4(D)(iv) and (v), on the
effective date of such notice automatically be on part-time employment status
until the date that the Employee reaches age sixty-five (65).

               (ii) Part-time Status -- Election by the Employee for Cause.  The
                    ------------------------------------------------------
Employee shall have the right at any time during his employment on active
status, at his sole option and election, by giving written notice to the
Secretary of the Company within six (6) months after the occurrence of the
event(s) that are the basis for the giving of such notice, to place himself on
part-time employment status and to terminate his employment under this Agreement
effective on the date that the Employee reaches age sixty-five (65), if

                    (a) the Company shall violate this Agreement in any material
          respect; or

                    (b) the Employee (other than by his own choice) shall not be
          reelected or reappointed by the Company to or shall be removed from
          (other than by reasons justifying such action by the Company under
          Sections 4(A)(i) or (ii), 4(E), or 4(F) of this Agreement) the offices
          and positions of Chairman of the Board of Directors of the Company or
          Chairman of the Executive Committee of the Board of Directors of the
          Company, or such higher or additional office or position to which the
          Employee, with his consent, may subsequently be elected; or

                    (c) the nature or scope of the duties, powers, authority,
          functions and responsibilities assigned to the Employee by the Company
          (or attached to the positions specified in Section 4(C)(ii)(b)) on the
          date hereof are increased, changed or diminished (without the
          Employee's express written consent) whether or not for cause (other
          than as defined in Section 4(A)(i) or (ii)), directly or indirectly,
          from the nature or scope of those duties, powers, authority, functions
          and responsibilities assigned to the Employee by the Company (or
          attached to the positions specified in Section 4(C)(ii)(b)) including,
          without limitation, any action or inaction which impairs or detracts
          in any respect from the Em-

                                      -8-
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          ployee's ability to perform, carry out or exercise such duties,
          powers, authority, functions and responsibilities.


               (iii)  Part-time Status Election by the Employee.  On or after
                      -----------------------------------------
January 1, 2002, and while employed by the Company on active status, the
Employee shall have the right, in his sole discretion, to elect to be employed
on part-time status until the date he reaches age sixty-five (65) by giving
prior written notice to the Secretary of the Company; provided, that if the
Employee previously has made such election pursuant to this Section 4(C)(iii),
on the date he reaches age sixty-five (65), the term of his part-time status
under this Agreement shall become a continually renewing term of one (1) year
until the effective date of termination of employment hereunder after notice of
termination of this Agreement is given by either the Employee or the Company,
with or without cause. If such notice is given by the Company after the Employee
has reached age sixty-five (65), such termination shall be effective on the
Employee's next birthday anniversary after the notice is given by the Company,
or sixty (60) days after the date of such notice, whichever is later. Any
election by the Employee under this Section 4(C)(iii) shall become effective as
soon as practicable and in any event no later than sixty (60) days after the
Secretary of the Company receives notice of such election.

               (iv)   Termination -- Election by the Employee.  The Employee
                      ---------------------------------------
shall have the right at any time during his employment on active status, by
giving written notice to the Secretary of the Company, to terminate the
Employee's employment under this Agreement effective ninety (90) days after the
date on which such notice is given by the Employee. In the event the Employee
shall make such election under this Section 4(C)(iv), the Employee shall, in
addition to all other reimbursements, payments or other allowances required to
be paid under this Agreement or under any other plan, agreement or policy which
survives the termination of this Agreement, be entitled to be paid, in addition
to the Base Salary payable during such ninety (90) day period after the giving
of such notice, a lump sum payment payable by delivery of the Company's
cashier's check within five (5) business days after the end of such ninety (90)
day period, in an amount equal to three (3) monthly installments of the Base
Salary (less required tax withholding) in effect pursuant to Section 3(A) hereof
at the time the Employee makes such election under this Section 4(C)(iv).
Thereupon, this Agreement shall terminate and the Employee shall have no further
rights under or be entitled to any other benefits of this Agreement, provided
that the provisions of Sections 3(F) and (E), 6, 7, 8 and 12 shall survive such
termination.

               D.     Employee's Rights on Part-time Status.  During the period
                      -------------------------------------
that the Employee is on part-time status,

               (i)    The Company shall pay the Employee a revised, guaranteed
          minimum annual base salary (the "Part-Time Base Salary") from the date
          the Employee goes on part-time status until the date that the Employee
          reaches age sixty-five (65), in an amount equal to seventy-five
          percent (75%) of the average of the total annual direct compensation
          paid to the Employee by the Company (whether under this Agreement, a
          predecessor agreement or otherwise) for the two (2) highest of the
          three (3) compensation years immediately preceding the compensation
          year in which the notice specified in Section 4(A)(iii), Section
          4(C)(ii) or (iii) or Section 4(F) of this Agreement is given.

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<PAGE>

          As used in this Agreement, the phrase "total annual direct
compensation" shall mean:

                (a) The gross amount of Base Salary (as from time to time
     adjusted) paid to the Employee during a compensation year; plus

                (b) All other forms of direct compensation attributable to that
     specific compensation year whether or not actually paid to the Employee
     during a subsequent compensation year. Compensation with respect to this
     subsection (b) shall include, but not be limited to, allowances or
     incentive or supplemental compensation awards made to the Employee and any
     amounts paid by the Company for the benefit of the Employee into any
     savings, deferred compensation or similar Company-sponsored plan or
     arrangement. Compensation with respect to this subsection (b) shall not
     include any amounts that must be recognized as compensation in any such
     compensation year as a result of the Employee's exercise of a stock option,
     exercise of a stock appreciation right, disqualified disposition of stock
     acquired pursuant to the exercise of an incentive stock option or receipt
     of an award or unit of the Company's (or any Successor's) stock.
     Compensation with respect to this subsection (b) shall also not include any
     amounts received by the Employee during a compensation year which would, as
     hereinabove provided, be taken into account in computing the direct
     compensation for a prior compensation year;

          (ii)  The Part-Time Base Salary payable by the Company to the Employee
     pursuant to this Section 4(D) shall be increased (but not decreased)
     annually on the first anniversary of the date of the Employee's going on
     part-time status and each anniversary thereafter, on a compound basis, by
     the same percentage increase (if any) in the Consumer Price Index for All
     Urban Consumer's - All Items Index, for Region/population size class cross
     classification for South/B (or any substantially similar index published
     for the same area) as published by the U.S. Department of Labor, Bureau of
     Labor Statistics for the twelve (12) month period immediately preceding the
     first anniversary of the date of the Employee's going on part-time status
     and on each yearly anniversary thereafter;

          (iii) The Employee shall continue to participate (at not less than his
     highest levels of participation or coverage during the last twelve (12)
     months the Employee was on active status) in all of the Company's pension,
     group life/medical/dental/accidental disability insurance, thrift, savings,
     deferred compensation, stock option, unit or award plans, vacation plans,
     automobile allowances and all other Company benefit plans, fringe benefits,
     allowances and accommodations of employment on active status that are
     afforded to the principal executive officers of the Company (including,
     without limitation, the security alarm system at the Employee's personal
     residence). No change from active to part-time status by the Employee
     pursuant to any provision of this Agreement shall be deemed to constitute a
     termination or cessation of the Employee's employment or a break in the
     Employee's continuous employment for purposes of any stock option or other
     equity award agreement between the Employee and the Company under any stock
     incentive plans of the Company. Subject to the terms of such stock option
     or equity award agreements and stock incentive plans, nothing in this
     Agreement and no action by the Company or the Employee pursuant to any
     provision of this Agreement shall (x) interrupt or prevent the orderly
     vesting of the Employee in his stock options or other equity awards or

                                      -10-
<PAGE>

     accelerate the time at which the Employee would otherwise be entitled to
     exercise his stock options in accordance with the terms of such stock
     option agreements and stock incentive plans, or (y) cause the Employee's
     stock options or other equity incentive awards to expire earlier than they
     otherwise would under such award agreements and stock incentive plans;

               (iv)   The Employee shall not be prevented from accepting other
     employment while on part-time status or engaging in (and devoting
     substantially all of his time to) other business activities that are not in
     conflict in any material respect with the limitations set forth in Section
     6 hereof; provided, however, if the Employee is on part-time status by
     virtue of action taken by him pursuant to Section 4(C)(iii), hereunder, the
     Employee may only engage in part-time employment which does not require him
     to devote substantially all of his time to any other business activity;

               (v)    This Agreement and the Employee's continuing employment on
     part-time status may be terminated at any time by the Company (x) pursuant
     to the provisions of Section 4(A)(ii), or (y) acting through its Board of
     Directors (and not a committee thereof) if the Employee violates the
     provisions of Sections 6, 7 or 8, respectively;

               (vi)   While on part-time status and except as otherwise required
     herein, the Employee shall not be required to perform any regular duties
     for the Company (except to provide such services consistent with the
     Employee's educational background, experience and prior positions with the
     Company, as may be acceptable to the Employee) or to seek or accept
     additional employment with any other person or firm (although the Employee
     shall be free to do so as long as accepting such additional employment or
     engaging in other business activity is not in conflict in any material
     respect with the limitations set forth in Section 4(D)(iv) or Section 6 of
     this Agreement). If the Employee, at his discretion, shall accept any such
     additional employment or engage in any such other business activity
     consistent with Section 6 of this Agreement, there shall be no offset,
     reduction or effect upon any rights, benefits or payments to which the
     Employee is entitled pursuant to this Agreement. Furthermore, the Employee
     shall have no obligation to account for, remit, rebate or pay over to the
     Company any compensation or other amounts earned or derived in connection
     with such additional employment or business activity consistent with
     Section 6 of this Agreement;

               (vii)  The Employee shall, however, make himself generally
     available for special projects or to consult with, the Company and its
     employees at such times and at such places as may be reasonably requested
     by the Company and which shall be reasonably satisfactory to the Employee
     and consistent with the Employee's regular duties and responsibilities in
     the course of his then new occupation or other employment, if any; and

               (viii) While on part-time status, the Company shall continue to
     provide the Employee with either the same or, at the Company's election, at
     a different location within the same general geographic area, alternate
     office space, furnishings, facilities, reserved parking, supplies,
     services, equipment, secretarial and administrative assistance that are in
     each case at least commensurate with the size and quality of that which are
     provided to

                                      -11-
<PAGE>

     the other principal executive officers of the Company. The Company and the
     Employee may mutually agree upon an equivalent monthly cash allowance in
     lieu of the Employee being provided all or any part of these items. The
     Company shall have no obligation to provide for or furnish these items if
     (x) the Employee has obtained a full-time position with another company or
     organization, and (y) such items are being furnished or provided for in
     comparable fashion by such other Company or organization. On and after the
     termination of this Agreement and the Employee's retirement as an employee
     of the Company or on and after the termination of this Agreement by the
     election of the Employee to take a lump sum payment upon a Change in
     Control as provided in this Employment Agreement in Section 3(G), the
     Company agrees to provide to the Employee until such time as the Employee
     reaches age 70 with either the same or, at the Company's election, at a
     different location within the same general geographic area, alternate
     office space, furnishings, facilities, reserved parking, supplies,
     services, equipment, secretarial and administrative assistance that are in
     each case at least commensurate with the size and quality of that which are
     provided to the other principal executive officers of the Company. The
     Company and the Employee may mutually agree upon an equivalent monthly cash
     allowance in lieu of the Employee being provided all or any part of these
     items. The Company shall have no obligation to provide for or furnish these
     items if (i) the Employee has obtained a full time position with another
     company or organization, and (ii) such items are being furnished or
     provided for in comparable fashion by such other company or organization.

          E.   Death.  In the event of the Employee's death during the term of
               -----
his employment hereunder, the Company shall pay a death benefit to the
Employee's surviving spouse or (if his spouse shall not survive him) to the
Estate of Thomas M. Garrott equal to two times his annual Base Salary or Part-
Time Base Salary then payable pursuant to Sections 3(A) or 4(D), as the case may
be, such death benefit to be paid in forty-eight equal monthly installments
commencing on the first day of the month following the date of death of the
Employee.

          F.   Disability.  The Employee shall be covered by the Company's
               ----------
disability benefit plan as such plan may from time to time exist. The Company
may eliminate or change the terms and conditions of said plan at its discretion
with no liability to the Employee other than the liability, if any, under such
plan which may have accrued up to the elimination or change of such plan. In the
event because of physical or mental illness or personal injury while the
Employee is on active status or part-time status, the Employee shall become
permanently unable or disabled such that he is unable to perform, and in all
reasonable medical likelihood, is going to continue indefinitely to be unable to
perform his normal duties in his regular manner, as determined by independent,
competent medical authority,

          (i)  if such disability determination occurs while the Employee is on
     active status, the Company may elect (but shall not be obligated) to
     terminate the Employee's employment under this Agreement on a date which is
     not less than three (3) years after the date on which written notice of
     such termination is received by the Employee in which event the Employee
     shall be placed on part-time status, and the Company shall pay to the
     Employee the Part-Time Base Salary payable pursuant to Section 4(D)(i)
     until the date that the Employee reaches age sixty-five (65); or

                                      -12-
<PAGE>

          (ii) if such disability determination occurs while the Employee is on
     part-time status pursuant to Section 4(C)(i), (ii) or (iii), the Company
     shall continue to pay to the Employee the amount of his Part-Time Base
     Salary then payable for the greater of (x) the balance of the period
     remaining under the term of this Agreement, or (y) for one (1) year;
     reduced, in any case however, by the amount of any payments made to the
     Employee under the coverage then afforded to the Employee by the Company's
     disability benefit plan in effect at the time such disability determination
     is made. The Employee shall, during such disability and until the effective
     date of the termination of this Agreement and of payments hereunder by the
     Company to the Employee, continue to enjoy all other applicable benefits of
     employment that would otherwise pertain to continued employment on part-
     time status pursuant to this Agreement.

          G.   Return of Property.  Upon termination of the Employee's
               ------------------
employment under this Agreement, however brought about, the Employee (or his
representatives) shall promptly deliver and return to the Company all the
Company's property including, but not limited to, credit cards, manuals,
customer lists, financial data, letters, notes, notebooks, reports and copies of
any of the above, and any Protected Information (as defined in Section 7) which
is in the possession or under the control of the Employee.

          H.   Post-Retirement Medical Benefits.  On and after the termination
               --------------------------------
of this Agreement and the Employee's retirement as an employee of the Company,
the Company shall provide medical and dental insurance coverage for the Employee
and his spouse for their lifetimes that is comparable to the medical and dental
insurance coverage provided by the Company to its principal executive officers
as of the date of this Agreement. The Company shall be entitled to credits for
coverage to the Employee and his spouse provided by Medicare. For purposes of
this Agreement, the Employee shall not be deemed to have retired until after the
expiration of his part-time status under this Agreement.

          I.   Affiliate Status; Stock Options.  After the termination of the
               -------------------------------
Employee's employment on active or part-time status, other than pursuant to
Section 4(A)(i) or (ii), the former Employee shall remain an "affiliate" of the
Company for the period described in Section 4(D)(iii) hereof and, as partial
consideration for such right, shall continue during such time to be available to
consult with the Company and its employees at such times and at such places as
may be reasonably convenient and acceptable to the former Employee and in such
manner as may be consistent with the former Employee's educational background,
experience and prior positions with the Company and with his regular duties and
responsibilities in the course of his then new occupation or other employment,
if any. All existing and hereafter granted stock in favor of the Employee
options shall vest according to their terms while the Employee is employed under
this Agreement or is serving as an affiliate hereunder and the Employee may
exercise such options within the time periods granted under all such stock
option plans pursuant to which the stock options were or are granted.

     5.   OTHER EMPLOYEE RIGHTS

          A.   The Employee shall be entitled to (i) participate in the
Company's pension, group life/medical/dental/accidental/disability insurance,
thrift, savings, deferred compen-

                                      -13-
<PAGE>

sation, incentive compensation, stock option, unit or award plans, vacation
plans, automobile allowances and all other Company benefit plans, fringe
benefits, allowances and accommodations of employment (including, but only as
approved from time to time by the Chief Executive Officer of the Company, club
memberships and dues, business and professional societies, etc.), accommodations
and allowances as are from time to time generally available or applicable to the
Company's principal executive officers and (ii) annual vacations in accordance
with the vacation policy established by the Company for the Company's principal
executive officers (but in no event less than currently available to the
Employee) during which time his applicable compensation shall be paid in full.


          B.   The Employee is authorized to incur reasonable business expenses
while on active status as an employee of the Company, including expenses for
meals, entertainment, hotel and air travel, telephone, automobile, dues, club
expenses, fees, and similar items and shall be entitled to incur such reasonable
business expenses, determined commensurate with the extent of his consultation
hereunder, while on part-time status with the Company. The Company shall either
pay directly or promptly reimburse the Employee for such expenses upon the
presentment by the Employee from time to time of an itemized accounting (as
reasonably required by the Company's policies) of such expenditures for which
reimbursement is sought.

          C.   The Employee shall be provided by the Company with office space,
furnishings and facilities, reserved parking, secretarial and administrative
assistance, supplies and equipment commensurate with the size and quality of
that which is being provided to the Employee on the date of this Agreement, but
in no event less than the same as are provided from time to time to the
Company's principal executive officers.

          D.   The Employee shall not be required to move his principal place of
residence from Memphis, Tennessee or to perform regular duties which could
reasonably be expected to require such move against his wish and the Company
agrees that no animosity or prejudice will be held against the Employee in the
event the Company should request such a move and the Employee declines such
request.

     6.   COVENANT NOT TO COMPETE

          A.   The Employee recognizes that in the highly competitive business
in which the Company is engaged, personal contact is of primary importance in
securing new customers and in retaining the accounts and goodwill of present
customers and protecting the business of the Company. The Employee, therefore,
agrees that at all times during the term of his employment hereunder and for a
period of two (2) years after the termination of his employment hereunder, he
will not, for himself or on behalf of any person, corporation, association or
other entity other than the Company:


          (i)  engage in the commercial banking business within any county in
     any state in which the Company or any corporation or other entity owned or
     controlled by either maintains an office or is engaged in the commercial
     banking business that produced in excess of 5% of the net income after tax
     of the Company on a consolidated basis for the twelve months prior to the
     date of termination of employment; or

                                      -14-
<PAGE>

          (ii) directly or indirectly solicit or attempt to solicit business
     from any customer of the Company existing on the date of termination of
     such employment; provided, however, that this covenant not to compete shall
     not apply after a termination of employment if such termination occurs for
     cause under Section 4(A)(i) or (ii).

          B.   The Employee and Company agree that the Employee's background in
the grocery business, his leadership in the development and implementation of
the supermarket banking initiative of the Company provides the Company with a
nationwide potential for the concept of supermarket banking that is unique
within the banking industry and that the retention of the services of the
Employee for the Company is a material consideration for this Agreement. The
Employee, therefore, further agrees at all times during the term of his
employment hereunder and for a period of two (2) years after the termination of
his employment hereunder, he will not, for himself or on behalf of any person,
corporation, association or other entity other than the Company engage in the
business of banking in supermarkets, grocery stores or other retail store
outlets anywhere in the United States. The business of banking as used in this
Section 6(B) shall include but not be limited to the direct or indirect
ownership interest licensing or consulting in or with regard to banking in
supermarkets, grocery stores or other retail store outlets.

          C.   If the provisions of this Section 6 are violated, in whole or in
part, the Company shall be entitled, upon application to any court of proper
jurisdiction, to a temporary restraining order or preliminary injunction
(without the necessity of posting any bond with respect thereto) to restrain and
enjoin the Employee from such violation without prejudice to any other remedies
the Company may have at law or in equity. Further, in the event that the
provisions of this Section 6 should ever be deemed to exceed the time geographic
or occupational limitations permitted by the applicable laws, the Employee and
the Company agree that such provisions shall be and are hereby reformed to the
maximum time, geographic or occupational limitations permitted by the applicable
laws. The provisions of this Section 6 shall survive the termination of the
Employee's employment or expiration or termination of this Agreement.

     7.   DISCLOSURE OF INFORMATION

          A.   The Employee recognizes and acknowledges that he has access to
confidential information concerning the Company, its parent, its subsidiaries
and corporations affiliated with the Company of a special and unique value which
includes (but is not limited to) the books and records relating to operation,
finance, accounting, loans, investments, personnel and management; written
policies and other printed matter relating particularly to operations such as
customer names and addresses and customer financial information. The Employee
also recognizes that a portion of the Company's business is dependent upon a
large number of trade secrets, including secret formulations, techniques,
methods, processes, data and the like. The Employee acknowledges and agrees that
protection of these trade secrets and confidential information against
unauthorized disclosure and use is of critical importance to the Company, and
the Employee therefore agrees that he will not at any time, either while
employed by the Company or afterwards, make any independent use of, or knowingly
disclose to any other person or organization (except as required by regulatory
authority or by a court or as authorized by the Company) any of the trade
secrets or other confidential proprietary information of the Company, whether
patentable or not. In the event of a breach or threatened breach by the Employee
of the provisions of this Section, the Company shall be entitled to an
injunction restraining the Em-

                                      -15-
<PAGE>

ployee from disclosing, in whole or in part, such confidential information.
Nothing herein shall be construed as prohibiting the Company from pursuing any
other remedies available to it for such breach or threatened breach, including
the recovery of damages from the Employee.

     8.   EMPLOYEE CONDUCT

          A.   The Employee represents and agrees with the Company that he will
not knowingly make any disbursement or other payment of any kind or character
out of the compensation paid or expenses reimbursed to him pursuant hereto or
with any other fund, which contravene, in any material respect, any policy of
the Company or, in any material respect, any applicable statute or rule,
regulation or order of any jurisdiction, foreign or domestic. The Employee
further agrees to indemnify and save harmless the Company from any liabilities,
obligations, claims, penalties, fines or losses resulting from any unauthorized
or unlawful acts of the Employee which contravene in any material respect any
policy of the Company or any statute, rule, regulation or order of any
jurisdiction, foreign or domestic, applicable to the Employee or the Company.
The provisions of this Section 8 shall survive the dissolution or termination of
the Employee's employment under this Agreement.


          B.   The Employee acknowledges that he has been furnished with a
current copy of the Employee Handbook of the Company dated 9/90, that he has
read and understands such policies and procedures set forth in such Handbook,
that he understands such policies and procedures (and will read and become
familiar with any revisions or supplements to this Handbook) are applicable to
the Employee in the performance of his duties and job performance for the
Company, and that he agrees to observe in all material respects the Company's
policies and procedures in the conduct by the Employee of his employment duties
for the Company.

          C.   The Employee agrees to disclose honestly and fully all
information and documentation in his possession concerning all transactions or
events relating to or affecting the Company or any entity owned, controlled (or
otherwise affiliated) by the Company, as and to the extent such information or
documentation is requested by the Company or the authorized representatives
thereof; provided that if the Employee indicates to the Company that the
information or documentation requested is privileged, confidential or personally
sensitive, appropriate steps will be taken to attempt to protect such privilege,
confidentiality or privacy to the extent possible consistent with the ethical
and legal obligations applicable to the Company, but neither such assertions by
the Employee nor the undertakings attempted by the Company with respect thereto
shall qualify the unconditional disclosure obligation of the Employee set forth
above.

     9.   GENERAL PROVISIONS

          A.   In case any one or more of the provisions of this Agreement
shall, for any reason, be held or found by final judgment of a court of
competent jurisdiction to be invalid, illegal or unenforceable in any respect
(i) such invalidity, illegality or unenforceability shall not affect any other
provisions of this Agreement, (ii) this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein
(except that this subsection (ii) shall not prohibit any modification allowed
under Section 6 hereof), and (iii) if the effect of a holding or finding that
any such provision is either invalid, illegal or unenforceable is to modify to
the Employee's detriment, reduce or eliminate any compensation, reimbursement,
payment, allowance or other benefit to the Employee intended by the Company and
the Em-

                                      -16-
<PAGE>

ployee in entering into this Agreement, the Company shall promptly negotiate and
enter into an agreement with the Employee containing alternative provisions
(reasonably acceptable to the Employee), that will restore to the Employee (to
the extent lawfully permissible) substantially the same economic, substantive
and income tax benefits the Employee would have enjoyed had any such provision
of this Agreement been upheld as legal, valid and enforceable. Failure to insist
upon strict compliance with any provision of this Agreement shall not be deemed
a waiver of such provision or of any other provision of this Agreement.

          B.   The Employee acknowledges receipt of a copy of this Agreement
(together with any attachments hereto, which has been executed in duplicate and
agrees that, with respect to the subject matter hereof, it is the entire
Agreement with the Company. Any other oral or any written representations,
understandings or agreements with the Company or any of its officers or
representatives covering the same subject matter which are in conflict with this
Agreement are hereby merged into and superseded by the provisions of this
Agreement.

          C.   The Company shall have no right of set-off or counterclaim in
respect of any debt or other obligation of the Employee to the Company against
any payment or other obligation of the Company to the Employee provided for in
this Agreement or pursuant to any other plan, agreement or policy.

          D.   No provision of this Agreement may be amended, modified or waived
unless such amendment, modification or waiver shall be agreed to in writing and
signed by the Employee and by a person duly authorized by the Board of Directors
of the Company.

          E.   No right to or interest in any compensation or reimbursement
payable hereunder shall be assignable or divisible by the Employee; provided,
however, that this provision shall not preclude the Employee from designating
one or more beneficiaries to receive any amount that may be payable after his
death and shall not preclude his executor or administrator from assigning any
right hereunder to the person or persons entitled thereto.

          F.   The headings of Sections and subsections hereof are included
solely for convenience of reference and shall not control the meaning or
interpretation of any of the provisions of this Agreement.

          G.   (i)    Company consents with respect to any action, suit or other
legal proceeding pertaining directly to this Agreement or to the interpretation
of or enforcement of any of the Employee's rights hereunder, to service of
process in the State of Tennessee and service of same at One Commerce Square,
Memphis, Tennessee 38150 upon any executive officer of the Company. Company
irrevocably (a) agrees that any such suit, action or legal proceeding may be
brought in the courts of such state or the courts of the United States for such
state, (b) consents to the jurisdiction of each such court in any such suit,
action or legal proceeding and (c) waives any objection it may have to the
laying of venue of any such suit, action or legal proceeding in any of such
courts.

          (ii) This Agreement shall be construed in accordance with and governed
for all purposes by the laws of the State of Tennessee.

                                      -17-
<PAGE>

          H.   This Agreement may not be assigned, partitioned, subdivided,
pledged, or hypothecated in whole or in part without the express prior written
consent of the Employee and Company. This Agreement shall not be terminated
either by the voluntary or involuntary dissolution or the winding up of the
affairs of the Company, or by any merger or consolidation wherein the Company is
not the surviving corporation, or by any transfer of all or substantially all of
the Company's assets on a consolidated basis. In the event of any such merger,
consolidation or transfer of assets the provisions of this Agreement shall be
binding upon and shall inure to the benefit of the surviving corporation or to
the corporation to which such assets shall be transferred.

          I.   If any amounts which are required or determined to be paid or
payable or reimbursed or reimbursable to the Employee under this Agreement (or
under any other plan, agreement, policy or arrangement with the Company) are not
so paid promptly at the times provided herein or therein, such amounts shall
accrue interest compounded daily at the annual percentage rate which is two
percentage points (2%) above the interest rate which is established by the
Company, from tine to time, as its Prime Rate, from the date such amounts were
required or determined to have been paid or payable or reimbursed or
reimbursable to the Employee until such amounts and any interest accrued thereon
are finally and fully paid; provided, however, that in no event shall the amount
of interest contracted for, charged or received hereunder exceed the maximum
non-usurious amount of interest allowed by applicable law.

          J.   The Company agrees with the Employee that, except to the required
by law, it will not make or publish, without the express prior written consent
of the Employee, any written or oral statement concerning the terms of the
Employee's employment relationship with the Company and will not, if the
Employee goes on part-time status for any reason or severs his employment with
the Company, make or publish any written or oral statement concerning the
Employee including, without limitation, his work-related performance or the
reasons or basis for the Employee going on part-time status or otherwise
severing his employment relationship with the Company.

     10.  TERMINATION OF PRIOR AGREEMENTS

          Except with respect to that certain Deferred Compensation Agreement
dated December 1, 1983, between National Bank of Commerce and Thomas M. Garrott
III, which shall remain in full force and effect, this Agreement shall terminate
and supersede any and all prior written or oral agreements or understandings
existing between the Company and the Employee with respect to employment or
compensation, and the Company and the Employee hereby mutually release and
discharge each other from any further obligation, liability or responsibility
under any of the foregoing.

     11.  NOTICES

          Any notice required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been given when delivered in
person or when deposited in the U.S. mail, registered or certified, postage
prepaid, and mailed to the respective addresses set forth herein.

                                      -18-
<PAGE>

     12.  DISPUTES; PAYMENT OF ATTORNEYS' FEES

          If at any time during the term of this Agreement or afterwards there
should arise any dispute as to the validity, interpretation or application of
any term or condition of this Agreement, the Company agrees, upon written demand
by the Employee to promptly provide sums sufficient to pay on a current basis
the Employee's costs and reasonable attorneys' fees (including expenses of
investigation and disbursements for the fees and expenses of experts, etc.)
incurred by the Employee in connection with any such dispute or any litigation,
(x) provided that the Employee shall repay any such amounts paid or advanced if
the Employee is not the prevailing party with respect to any dispute or
litigation arising under Sections 6, 7 or 8, or (y) regardless of whether the
Employee is the prevailing party in a dispute or in litigation involving any
other provision of this Agreement, provided that the court in which such
litigation is first initiated determines with respect to this obligation, upon
application of either party hereto, the Employee did not initiate frivolously
such litigation. Under no circumstances shall the Employee be obligated to pay
or reimburse the Company for any attorneys' fees, costs or expenses incurred by
the Company. The provisions of this Section 12 shall survive the expiration or
termination of this Agreement and of the Employee's employment hereunder.

                                      -19-
<PAGE>

          IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the day and year indicated above.


                                             ______________________________
                                             Thomas M. Garrott

                                             Employee's Permanent Address:
                                             4001 South Galloway Drive
                                             Memphis, Tennessee 38111


                                             NATIONAL BANK OF COMMERCE

                                             By:___________________________
                                             Name:
                                             Title:


                                             NATIONAL COMMERCE BANCORPORATION

                                             By:___________________________
                                             Name:
                                             Title:

                                      -20-