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                                  EXHIBIT 10.2

                              EMPLOYMENT AGREEMENT



THIS EMPLOYMENT  AGREEMENT (the  "Agreement") is made and entered into as of the
1st day of January,  1998, between TED A. MURPHY,  ("Executive"),  and COMMUNITY
BANK OF GEORGIA, a state-chartered  Georgia banking  institution whose principal
place of business is located at 3333  Lawrenceville  Highway,  Tucker,  Georgia,
("Employer").

                                    RECITALS

         WHEREAS,  the  Board  of  Directors  of the  Employer  recognizing  the
experience  and knowledge of the Executive in the banking  industry,  determines
that it is in the best  interests of the Employer to arrange terms of employment
for  Executive  so as to induce  Executive  to remain in his  capacity  with the
Employer  for  the  term  as  set  forth  in  this  Employment   Agreement  (the
"Agreement"); and

         WHEREAS,  Executive  is willing  to provide  services  to  Employer  in
accordance with the terms and conditions hereinafter set forth.

         THEREFORE,  in the  consideration of the mutual promises and agreements
in these premises and for other good and valuable consideration, the receipt and
sufficiency  of which are hereby  acknowledged  by the parties,  it is agreed as
follows:

SECTION 1.        EMPLOYMENT

         a. Employer  employs  Executive on the terms and  conditions  hereafter
stated as  Employer's  President  and Chief  Executive  Officer to perform  such
services and duties as the Board of Directors may, from time to time,  designate
during  the term  hereof.  Executive  will  also  serve as  President  and Chief
Executive Officer of Georgia Bancshares,  Inc.,  ("Bancshares") Tucker, Georgia,
the Employer's parent bank holding company.  Subject to the terms and conditions
hereof,  Executive  will perform such duties and exercise such  authority as are
customarily  performed and exercised by persons holding such office,  subject to
the direction of the Board of Directors.

         b.  Executive  accepts such  employment and shall devote his full time,
attention,  and best efforts to the diligent  performance  of his duties  herein
specified.

SECTION 2.        TERM OF EMPLOYMENT.

         a.   Executive's   employment   under  this  Agreement  shall  commence
immediately on January 1, 1998. Such  employment  shall continue for a period of
thirty-six full calendar months commencing January 1, 1998.



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         b.  Executive's   employment   pursuant  to  this  Agreement  shall  be
terminated by the first to occur of any of the following:

                  i)       The death of the Executive;

                  ii)  The   Complete   Disability   of   Executive.   "Complete
Disability"  as used  herein  shall  mean the  inability  of  Executive,  due to
illness,  accident,  or any other physical or mental  incapacity,  to completely
fulfill his  obligations  hereunder  for an aggregate of ninety (90) days within
any period of 180 consecutive days during the term hereof;

                  iii)     The discharge of Executive by Employer for cause.

                           (1)  "Cause" as used herein  shall mean:  dishonesty;
         theft;  conviction  of a crime  (other than minor  traffic  violations)
         which is either a felony or a misdemeanor  involving  moral  turpitude;
         unethical  business conduct;  gross or repeated  negligence in carrying
         out Executive's  duties. In all instances other than dishonesty,  theft
         or conviction of a crime,  written notice of said activity,  negligence
         or violation  shall be provided by Employer to  Executive  along with a
         reasonable  period of time,  which  shall be not less than  ninety (90)
         days, in which to correct the deficiency.

                           (2)  Discharge for "Cause" shall require a two-thirds
         majority  vote of the entire Board of  Directors of Employer  excluding
         the Executive from voting on the discharge.

                  iv) Sixty (60) days after  Executive has given written  notice
to Employer of his intent to terminate his employment hereunder.

         c.   Termination  of  Executive's   employment   shall  constitute  his
resignation as an employee, director and executive officer of Employer (and as a
director and  executive  officer of  Bancshares)  effective  upon  acceptance by
Employer of that tender.

SECTION 3.        COMPENSATION.

For all services which  Executive may render to Employer  during the term hereof
Employer shall pay to Executive,  subject to such  deductions as may be required
by law, according to the schedule set out below:

         a. Annual Base Salary. From January 1, 1998, through December 31, 1998,
Executive  shall  receive a salary  payable based on an annual rate of $138,400,
payable in equal monthly  installments.  The annual base salary for the calendar
year 1999 will be increased  by five percent (5%) to $145,320,  payable in equal
monthly installments.  The annual base salary for the calendar year 2000 will be
increased  by  five  percent  (5%)  to  $152,586,   payable  in  equal   monthly
installments.


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         b.       Performance  Bonus.  In addition to the  Executive's  annual
base  salary,  the Employer shall pay to Executive a performance bonus.

         The right to receive an annual  performance bonus is based upon meeting
or  exceeding  established  goals with  respect to (i) return on average  assets
("ROAA"),  (ii) return on average  equity  ("ROE"),  and (iii)  average past due
loans.  No  performance  bonus  shall be earned in any year in which the  Bank's
composite C-A-M-E-L-S rating is less than "2".

         Three levels of bonus are available hereunder. A Level I bonus is equal
to 10% of annual  base  salary,  a Level II bonus is equal to 15% of annual base
salary and a Level III bonus is equal to 20% of annual base salary.  In order to
receive a Level I bonus, the Executive must achieve either (i) at least 2 of the
Level I performance  goals, or (ii) at least 1 of the Level I performance  goals
and 1 of the Level II or Level III performance  goals. In order to receive Level
II  bonus,  the  employee  must  achieve  either  (i) at least 2 of the Level II
performance goals, or (ii) at least 1 of the Level II performance goals and 1 of
the Level III  performance  goals.  In order to receive a Level III  bonus,  the
Executive must achieve at least 2 of the Level III performance goals.  Operation
of the performance bonus criteria is as follows:
<TABLE>
<CAPTION>


----------------------------- ----------------------------- --------------------------- ============================
           BONUS                                                                                  AVG. PAST
           LEVEL                          ROAA                          ROE                      DUE LOANS
----------------------------- ----------------------------- --------------------------- ============================
<S>                          <C>                           <C>                         <C>
============================ ----------------------------- --------------------------- ============================
Level I                       1%                            10%                         2%
                              but less than                 but less than               but more than
                              1.25%                         12%                         1.5%
============================= ----------------------------- --------------------------- ============================
Level II                      1.25%                         12%                         1.5%
                              but less than                 but less than               but more than
                              1.5%                          15%                         1.25%
============================= ============================= =========================== ============================
Level III                     1.5% or greater               15% or greater              1.25% or less
============================= ============================= =========================== ============================
</TABLE>

         c.  Election  to  Defer  Performance  Bonus.  Prior  to the  end of any
contract year, Executive shall be permitted to make an election to defer receipt
of all or a portion of any annual performance based bonus that otherwise becomes
payable for such year.  The  election to defer  receipt of any such  performance
bonus  shall  be  made in  writing  on a  Deferred  Compensation  Election  Form
(Attachment "A") provided by the Employer. Any such election shall be subject to
the provisions of the Executive's Deferred Compensation Election Form.


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         d. Severance Compensation.  If the Executive's employment is terminated
during  the term of this  Agreement  for  reasons  other  than  those  stated in
paragraphs  2(b)(iii)  or  (iv),  Employer  shall  pay  Executive  as  Severance
Compensation,  without set off, reduction,  or diminution for other compensation
which Executive may receive from sources other than Employer, a sum equal to the
gross monthly  compensation  which would then be payable to Executive  under the
terms and  conditions of this  Agreement  without  reduction for taxes except as
required by law and  payable  for  twenty-four  (24)  consecutive  months or the
remainder  of the  term of  this  Agreement  whichever  is  greater  ("Severance
Compensation"). Said Severance Compensation shall be payable on the first day of
each month following Executive's termination of employment.  Notwithstanding the
foregoing,  if mutually  agreed between  Employer and  Executive,  the Severance
Compensation may be paid in one lump sum or other equal payments. Employer shall
maintain  Executive's full medical and disability benefits for Executive and his
family at no expense to Executive  for  twenty-four  months  subsequent  to said
termination or the remainder of the term of this Agreement whichever is greater.
Thereafter,  Executive  shall be  eligible  to secure  such  medical  and dental
benefits  as may  be  available  pursuant  to the  Consolidated  Omnibus  Budget
Reconciliation Act of 1985 ("COBRA") at Executive's expense.

SECTION 4.        OTHER BENEFITS

During  the  term  of  Executive's  employment  hereinafter,  on and  after  the
effective  dates,  as noted,  Employer  shall furnish to Executive the following
benefits.

         a. A group health and  hospitalization  insurance  policy  covering the
Executive and immediate family.

         b. A monthly car  allowance  covering  depreciation,  insurance and all
operating costs in an amount of $1,000 per month.

         c. In lieu of the foregoing car  allowance,  the Employer and Executive
may mutually agree that Executive will be provided use of an automobile owned or
leased  by  Employer  with  reimbursement  to  Executive  for all out of  pocket
expenses  incurred  by  Executive  for the use and  upkeep  of said  automobile,
including  taxes,  if any,  which may become due and payable by Executive  based
upon such arrangement.

         d. All expenses for  attendance  of the Executive and his spouse at the
annual  convention  of the  Community  Banker's  Association  of Georgia and the
Georgia Banker's Association.

         e. Initiation fees,  membership fees and monthly dining room charges at
a golf,  dining or country club of Executive's  choosing in an aggregate  annual
amount not to exceed $7,500.


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         f. All  reasonable  expenses  shall be reimbursed  on a monthly  basis,
however these expenses are subject to review and approval of the Chairman of the
Employer's Board of Directors or the Vice Chairman.

         g. A fully paid  vacation of twenty (20)  working days per year for the
duration and any continuance of this contract.  Time for such vacation/vacations
shall be determined  solely by the Executive  provided  Executive shall give the
Chairman of Employer's Board of Directors or the Vice Chairman, reasonable prior
notice of the Executive's scheduled vacation days.

         h. An Executive  Assistance Program ("EAP") for Executive and immediate
family to help resolve the problems  which may include,  but are not limited to,
stress,  marital,  family, child rearing,  drugs,  alcohol,  prescription drugs,
legal, financial,  health or any other problems that may be of concern. Referral
by EAP to an outside agency may involve  additional charges which may be covered
in part by the Employer's health plans.

SECTION 5.        POST TERMINATION COVENANTS.

         a. Executive hereby expressly covenants and agrees that during the term
of his employment  whether or not pursuant to this Agreement and for a period of
twelve (12) months following the termination of his employment with Employer, if
said termination is pursuant to Section 2(b)(iv),  Executive shall not engage in
rendering or providing executive  managerial services as chief executive officer
or serve as chief  executive  officer of or to any  National  Bank or State Bank
Institution  located  within  an area of ten  (10)  miles of  Community  Bank of
Georgia's  main office or its  branches  without the express  permission  of the
Employer. This covenant shall not be effective against Executive in the event of
termination  of Executive  for any other  reason,  actual,  or  constructive  as
provided herein below.

SECTION 6.        CHANGE IN CONTROL.

So long as this Agreement is in effect,  in the event of a Change in Control (as
that term is defined  below) of  Employer  and/or  Bancshares,  if the duties of
Executive are changed (as defined  below) within two (2) years after such Change
in Control,  and the  Executive so notifies  Employer in writing  within six (6)
months  thereof,  such  change in  duties  shall  constitute  a  termination  of
Executive's employment hereunder by Employer for reasons other than those stated
in paragraphs 2(b)(iii) and (iv). In that event,  Executive shall be entitled to
receive all of the  Severance  Compensation  due and payable to Executive  under
Section 3(d) this Agreement without set off, reduction,  or diminution for other
compensation which Executive may receive from sources other than Employer.


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         a.       "Change in Duties"shall mean any one or more of the following:

                  i) a  significant  change  in  the  nature  or  scope  of  the
Executive's  authorities  (including  a change in title)  or duties  from  those
applicable  to him  immediately  prior to the date on which a Change of  Control
occurs;

                  ii)      a reduction in the Executive's  Annual Base Salary
from that provided for under this Agreement;

                  iii)  any  diminution  in  the   Executive's   eligibility  to
participate  or  level  of  participation  in  bonus,  stock  option  and  other
compensation plans which provide opportunities to receive compensation, from the
greater of:

                  -the opportunities provided by the Bank for executives with
                  comparable duties; or
                  -the  opportunities  under any such plans  under  which he was
                  participating  immediately prior to the date on which a Change
                  of Control  occurs  including  as set forth in Section 3(b) of
                  this Agreement;

                  iv) a diminution  in  Executive  benefits  (including  but not
limited to medical,  dental, life insurance and long-term  disability plans) and
perquisites applicable to Executive, from the greater of:

                  -the  Executive  benefits  and  perquisites  provided  by the
                  Bank to  executives  with comparable duties; or
                  -the Executive  benefits and perquisites to which he was
                  entitled  immediately  prior to the date on which a Change in
                  Control occurs;

                  v) a change in the location of the Executive's principal place
of  employment  by the Bank (more than 50 miles from the  location  where he was
principally  employed immediately prior to the date on which a Change of Control
occurs) to which Executive has not agreed;

         b.       A "Change of Control" shall be deemed to have occurred if:

                  i) any person, including a "group" as determined in accordance
with Section  13(d)(3) of the  Securities  Exchange  Act of 1934 (the  "Exchange
Act") (other than  Bancshares,  or any  Executive  benefit  plan,  as defined in
ERISA, of any of the foregoing) is or becomes the beneficial owner,  directly or
indirectly, of securities of Bancshares representing 25% or more of the combined
voting power of Bancshares's then outstanding securities;

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                  ii) as a result of, or in connection with, any tender offer or
exchange  offer,  merger  or  other  business  combination,  sale of  assets  or
contested  election,  or  any  combination  of  the  foregoing  transactions  (a
"Transaction"), the persons who were directors of the Bank and Bancshares before
the  Transaction  shall cease to constitute a majority of the Board of Directors
of the Bank or Bancshares or any successor to the Bank or Bancshares;

                  iii) the Bank or  Bancshares  is merged or  consolidated  with
another corporation and as a result of the merger or consolidation less than 51%
of the outstanding  voting securities of the surviving or resulting  corporation
shall then be owned in the aggregate by the former,  shareholders of Bancshares,
other than (x)  affiliates  within the  meaning of the  Exchange  Act or (y) any
party to the merger or consolidation;

                  iv) a tender offer or exchange  offer is made and  consummated
for the ownership of securities  of Bancshares  representing  50% or more of the
combined voting power of Bancshares's then outstanding voting securities; or

                  v)       the Bank  transfers  substantially  all of its assets
to  another  corporation which is not a wholly-owned subsidiary of Bancshares.

SECTION 7.        CONFLICTS OF INTEREST.

Executive  shall not, while  employed by Employer,  accept  employment  with any
other  individual,  corporation,  partnership,  governmental  authority or other
entity,  or engage in any other venture for profit which the Employer's Board of
Directors  may consider by majority  vote of all of the  directors  then serving
with Executive abstaining to be in conflict with the Employer's best interest or
to be in  competition  with  the  performance  of  his  duties  hereunder.  This
restriction  does not preclude  Executive  from owning or being involved in real
estate or other  investments,  so long as such  does not  create a  conflict  of
interest  on the part of the  Executive  as to his  duties  and  obligations  to
Employer as set forth herein.  In addition,  the Executive may be a Board member
of  companies  not  in  competition  with  the  Employer.   Notwithstanding  the
foregoing,  Executive  may not be  involved in any of these  activities  without
first making a full  disclosure  to the Employer of the details of each proposed
endeavor.

SECTION 8.        WAIVER OF PROVISIONS.

Failure by any of the parties  hereto to insist,  in one or more  instances,  on
performance by the other in strict  accordance  with the terms and conditions of
this  Agreement  shall  not be deemed a waiver  or  relinquishment  of any right
granted hereunder or of the obligation of future performance of any such term or
condition or any other term or condition of this  Agreement,  unless such waiver
is contained in a writing signed by or on behalf of all the parties.

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SECTION 9.        GOVERNING LAW.

This  Agreement  shall be governed by and  construed  and enforced in accordance
with the laws of the State of Georgia.  If for any reason any  provision of this
Agreement  shall  be held by a court  of  competent  jurisdiction  to be void or
unenforceable, the same shall not affect the remaining provisions hereof.

SECTION 10.       MODIFICATION AND AMENDMENT.

This Agreement  contains the sole and entire  agreement among the parties hereto
and supersedes all prior  discussions and agreements among the parties,  and any
such prior agreements  shall,  from and after the date hereof, be null and void;
except,  nothing  herein shall cause the Agreement by and between  Executive and
Employer  dated as of  September  13,  1994,  to  terminate  other that upon its
Initial  Termination  Date of December 31,  1997.  This  Agreement  shall not be
modified or amended except by an instrument in writing signed by or on behalf of
all parties hereto.

SECTION 11.       NOTICE AND MAILING THEREOF.

Whenever  in this  Agreement  notice  is  required  to be given to either of the
parties hereto,  such notice shall be effective only if delivered to the parties
as follows by hand delivery or first class United States Mail:

                  If to Employer:           Chairman of the Board
                                            Community Bank of Georgia
                                            3333 Lawrenceville Highway
                                            Tucker, Georgia  30084

                  If to Executive:          Ted A. Murphy
                                            1761 East Gate Drive
                                            Stone Mountain, Georgia 30087

SECTION 12.       RECITALS, COUNTERPARTS AND HEADINGS.

The Recitals  appearing above are incorporated  into this Agreement as fully and
completely  as if set forth  expressly  herein and are an integral  part of this
Agreement.  This  Agreement  may be  executed  simultaneously  in any  number of
counterparts,  each of which shall be deemed an original  but all of which shall
constitute  one and the same  instrument.  The  headings  set out herein are for
convenience of reference and shall not be deemed a part of this Agreement.

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SECTION 13.       SUCCESSORS.

This  Agreement  shall inure to the benefit of and be binding upon the Employer,
its successors  and assigns and upon the  Executive,  and his heirs and personal
representatives.  Neither  this  Agreement  nor  performance  hereunder  may  be
assigned by Executive.

IN WITNESS  WHEREOF,  the parties have caused this  Agreement to be executed and
delivered as of the day and year first above written.


EXECUTIVE:                                  EMPLOYER:

                                            COMMUNITY BANK OF GEORGIA



/s/ Ted A. Murphy                           By: /s/Eugene L. Argo
Ted A. Murphy                               Chairman of Board of Directors


                                            ATTEST:

                                               /s/James L. Armstrong, Jr.
Ted A. Murphy                               Chairman, Compensation Committee