COMMUNITY BANK OF TRI-COUNTY

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                       Restated Employment Agreement with
                              Michael L. Middleton
                      ------------------------------------



     AGREEMENT,  originally  entered  into as of June 1, 1986 and  amended as of
March 1, 1991 and August  28,  1996,  and  restated  effective  this 23rd day of
February,  1998, by and between  Community  Bank of Tri-County  (the "Bank") and
Michael L. Middleton (the "Employee").

     WHEREAS,  the  Employee  has  heretofore  been  employed by the Bank as its
President and Chief  Executive  Officer and is  experienced in all phases of the
business of the Bank; and

     WHEREAS, the Bank and Employee are parties to an employment agreement dated
June 1, 1986 and amended as of March 1, 1991 and August 28, 1996; and

     WHEREAS,  the parties  desire by this  writing to restate the terms of such
employment agreement.

     NOW, THEREFORE, it is AGREED as follows:

     1.   Defined Terms
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     When used anywhere in this  Agreement,  the following  terms shall have the
meaning set forth herein.

          (a)"Change in Control" shall mean any one of the following events: (i)
     the acquisition of ownership, holding or power to vote more than 25% of the
     voting  stock  of the Bank or the  Company,  (ii)  the  acquisition  of the
     ability  to  control  the  election  of a  majority  of the  Bank's  or the
     Company's directors,  (iii) the acquisition of a controlling influence over
     the  management  or policies of the Bank or of the Company by any person or
     by persons acting as a "group"  (within the meaning of Section 13(d) of the
     Securities  Exchange  Act of  1934),  or  (iv)  during  any  period  of two
     consecutive  years,  individuals  (the  "Continuing  Directors") who at the
     beginning of such period  constitute  the Board of Directors of the Bank or
     of the Company (the "Existing Board") cease for any reason to constitute at
     least  two-thirds  thereof,  provided that any individual whose election or
     nomination for election as a member of the Existing Board was approved by a
     vote of at least  two-thirds  of the  Continuing  Directors  then in office
     shall be considered a Continuing  Director.  Notwithstanding the foregoing,
     the Company's ownership of the Bank shall not of itself constitute a Change
     in Control for purposes of the  Agreement.  For purposes of this  paragraph
     only,  the  term  "person"  refers  to  an  individual  or  a  corporation,
     partnership,  trust,  association,  joint venture,  pool,  syndicate,  sole
     proprietorship, unincorporated organization or any other form of entity not
     specifically listed herein.

          (b)"Company" shall mean Tri-County Financial Corporation.


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          (c)"Code"  shall mean the Internal  Revenue  Code of 1986,  as amended
     from  time to time,  and as  interpreted  through  applicable  rulings  and
     regulations in effect from time to time.

          (d)"Code Sec.280G  Maximum"  shall  mean the  product  of 2.99 and the
     Employee's "base amount" as defined in Code Sec.280G(b)(3).

          (e)"Disability"  shall  mean a  physical  or  mental  infirmity  which
     impairs the Employee's  ability to  substantially  perform his duties under
     this  Agreement  and which  results in the Employee  becoming  eligible for
     long-term  disability  benefits under the Bank's long-term  disability plan
     (or, if the Bank has no such plan in effect,  which impairs the  Employee's
     ability to  substantially  perform his duties  under this  Agreement  for a
     period of 180 consecutive days).

          (f)"Effective  Date"  shall  mean  the  date  of  restatement  of this
     Agreement, February 23, 1998.

          (g)"Good Reason" shall mean any of the following events, which has not
     been  consented  to  in  advance  by  the  Employee  in  writing:  (i)  the
     requirement that the Employee move his personal  residence,  or perform his
     principal executive  functions,  more than 30 miles from his primary office
     as of the  later  of the  Effective  Date  and the  most  recent  voluntary
     relocation by the  Employee;  (ii) a material  reduction in the  Employee's
     base  compensation  under this  Agreement as the same may be increased from
     time to time;  (iii) the  failure by the Bank or the Company to continue to
     provide the Employee with  compensation  and benefits  provided  under this
     Agreement as the same may be increased  from time to time, or with benefits
     substantially  similar to those  provided to him under any of the  employee
     benefit plans in which the Employee now or hereafter becomes a participant,
     or the taking of any action by the Bank or the Company which would directly
     or  indirectly  reduce any of such  benefits or deprive the Employee of any
     material  fringe  benefit  enjoyed  by him under this  Agreement;  (iv) the
     assignment  to the  Employee  of  duties  and  responsibilities  materially
     different from those normally  associated with his position;  (v) a failure
     to reelect the Employee to the Board of Directors of the Bank (the "Board")
     or  the  Company;  or  (vi)  a  material  diminution  or  reduction  in the
     Employee's    responsibilities    or   authority    (including    reporting
     responsibilities) in connection with his employment with the Bank.

          (h)"Just  Cause" shall mean,  in the good faith  determination  of the
     Bank's   Board  of   Directors,   the   Employee's   personal   dishonesty,
     incompetence,  willful  misconduct,  breach  of  fiduciary  duty  involving
     personal  profit,  intentional  failure to perform stated  duties,  willful
     violation of any law, rule or regulation (other than traffic  violations or
     similar  offenses) or final  cease-and-desist  order, or material breach of
     any  provision  of this  Agreement.  The  Employee  shall  have no right to
     receive compensation or other benefits for any period after termination for
     Just  Cause.  No act, or failure to act,  on the  Employee's  part shall be
     considered "willful" unless he has acted, or failed to act, with an absence
     of good faith and without a reasonable belief that his action or failure to
     act was in the best interest of the Bank and the Company.

          (i)"Protected  Period"  shall mean the period  that begins on the date
     six months  before a Change in Control  and ends on the later of the second
     annual  anniversary of the Change in Control or the expiration date of this
     Agreement.

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<PAGE>

          (j)"Trust"  shall mean a grantor  trust that is designed in accordance
     with Revenue Procedure 92-64 and has a trustee  independent of the Bank and
     the Company.

     2.  Employment.  The  Employee  is  employed  as the  President  and  Chief
         ----------
Executive Officer of the Bank. The Employee shall render such administrative and
management  services  for  the  Bank  as  are  currently  rendered  and  as  are
customarily  performed by persons situated in a similar executive capacity.  The
Employee shall also promote, by entertainment or otherwise, as and to the extent
permitted by law, the business of the Bank. The Employee's other duties shall be
such as the Board  may from time to time  reasonably  direct,  including  normal
duties as an officer of the Bank.

     3. Base  Compensation.  The Bank agrees to pay the Employee during the term
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of this  Agreement a salary at the rate of $142,100  per annum,  payable in cash
not less  frequently than monthly.  The Board shall review,  not less often than
annually,  the rate of the  Employee's  salary,  and in its sole  discretion may
decide to increase his salary.

     4.  Discretionary  Bonuses.  The Employee shall participate in an equitable
         ----------------------
manner with all other senior  management  employees of the Bank in discretionary
bonuses  that  the  Board  may  award  from  time to time to the  Bank's  senior
management employees. No other compensation provided for in this Agreement shall
be  deemed  a  substitute  for  the  Employee's  right  to  participate  in such
discretionary bonuses.

     5. Participation in Retirement, Medical and Other Plans.
        -----------------------------------------------------

          (a) The  Employee  shall  be  eligible  to  participate  in any of the
     following  plans  or  programs  that  the  Bank  may  now or in the  future
     maintain:  group hospitalization,  disability,  health, dental, sick leave,
     life  insurance,  travel and/or  accident  insurance,  auto  allowance/auto
     lease,  retirement,  pension,  and/or other present or future  qualified or
     nonqualified plans provided by the Bank, generally which benefits, taken as
     a whole,  must be at least as favorable as those in effect on the Effective
     Date.

          (b) The Employee  shall also be eligible to  participate in any fringe
     benefits which are or may become available to the Bank's senior  management
     employees,   including   for   example:   any  stock  option  or  incentive
     compensation  plans, and any other benefits which are commensurate with the
     responsibilities  and functions to be performed by the Employee  under this
     Agreement.   The  Employee   shall  be   reimbursed   for  all   reasonable
     out-of-pocket business expenses which he shall incur in connection with his
     services  under this  Agreement  upon  substantiation  of such  expenses in
     accordance with the policies of the Bank.

     6. Term.  The Bank hereby  employs the  Employee,  and the Employee  hereby
        -----
accepts such employment under this Agreement,  for the period  commencing on the
Effective  Date and  ending 60 months  thereafter  (or such  earlier  date as is
determined in accordance  with Section 10 or 12 hereof).  Additionally,  on each
annual  anniversary  date  from  the  Effective  Date,  the  Employee's  term of
employment  shall be extended for an additional  one-year period beyond the then
effective  expiration  date,  provided  the Board  determines  in a duly adopted
resolution that the performance of the Employee has met the Board's requirements
and standards,  and that this Agreement shall be extended. Only those members of
the  Board  of  Directors  who  have no


<PAGE>

personal  interest in this  Employment  Agreement  shall discuss and vote on the
approval and subsequent review of this Agreement.

     7. Loyalty; Noncompetition.
        ------------------------

          (a)  During  the  period of his  employment  hereunder  and except for
     illnesses,  reasonable vacation periods,  and reasonable leaves of absence,
     the Employee shall devote all his full business time, attention, skill, and
     efforts to the  faithful  performance  of his duties  hereunder;  provided,
     however,  from  time to time,  the  Employee  may  serve on the  boards  of
     directors  of, and hold any other  offices or  positions  in,  companies or
     organizations,  which will not  present any  conflict of interest  with the
     Bank or any of its  subsidiaries or affiliates,  or unfavorably  affect the
     performance of the Employee's  duties pursuant to this  Agreement,  or will
     not violate any applicable  statute or regulation.  "Full business time" is
     hereby defined as that amount of time usually  devoted to like companies by
     similarly  situated executive  officers.  During the term of his employment
     under this  Agreement,  the  Employee  shall not engage in any  business or
     activity contrary to the business affairs or interests of the Bank.

          (b) Nothing  contained in this  Section  shall be deemed to prevent or
     limit  the  Employee's  right  to  invest  in the  capital  stock  or other
     securities of any business  dissimilar from that of the Bank, or, solely as
     a passive or minority investor, in any business.

     8. Standards. The Employee shall perform his duties under this Agreement in
        ----------
accordance with such  reasonable  standards as the Board may establish from time
to time.  The Bank will provide the  Employee  with the working  facilities  and
staff  customary  for similar  executives  and  necessary for him to perform his
duties.

     9. Vacation and Sick Leave. At such reasonable  times as the Board shall in
        ------------------------
its discretion permit,  the Employee shall be entitled,  without loss of pay, to
absent himself  voluntarily  from the  performance of his employment  under this
Agreement, all such voluntary absences to count as vacation time, provided that:

          (a) The Employee shall be entitled to an annual vacation in accordance
     with the  policies  that the  Board  periodically  establishes  for  senior
     management employees of the Bank, which shall in no event be less than four
     (4) weeks per annum.

          (b) The Employee  shall not receive any additional  compensation  from
     the Bank on account of his failure to take a vacation  or sick  leave,  and
     the Employee  shall not accumulate  unused  vacation or sick leave from one
     fiscal year to the next,  except in either case to the extent authorized by
     the Board.

          (c) In addition to the aforesaid paid vacations, the Employee shall be
     entitled  without  loss of pay,  to  absent  himself  voluntarily  from the
     performance of his employment with the Bank for such additional  periods of
     time and for such  valid  and  legitimate  reasons  as the Board may in its
     discretion determine.  Further, the Board may grant to the Employee a leave
     or leaves of absence,  with or without  pay, at such time or times and upon
     such terms and conditions as such Board in its discretion may determine.

                                       4
<PAGE>

          (d) In  addition,  the  Employee  shall be  entitled to an annual sick
     leave benefit as established by the Board. In the event any sick leave time
     shall not have been  used  during  any year,  such  leave  shall  accrue to
     subsequent years only to the extent authorized by the Board.

     10.  Termination and  Termination  Pay.  Subject to Section 12 hereof,  the
          ----------------------------------
Employee's   employment   hereunder  may  be  terminated   under  the  following
circumstances:

          (a)  Death.  The  Employee's  employment  under this  Agreement  shall
     terminate upon his death during the term of this Agreement,  in which event
     the Employee's estate shall be entitled to receive the compensation due the
     Employee  through  the last day of the  calendar  month in which  his death
     occurred.

          (b) Disability.  (1) The Bank may terminate the Employee's  employment
     after having  established  the  Employee's  Disability,  in which event the
     Employee shall be entitled to the  compensation  and benefits  provided for
     under this  Agreement for (i) any period during the term of this  Agreement
     and prior to the  establishment of the Employee's  Disability  during which
     the Employee is unable to work due to the physical or mental infirmity, and
     (ii) any period of Disability which is prior to the Employee's  termination
     of employment  pursuant to this Section  10(b);  provided that any benefits
     paid  pursuant to the Bank's  long term  disability  plan will  continue as
     provided in such plan without  reduction for payments made pursuant to this
                           -------
     Agreement.

               (2) During any period that the Employee shall receive  disability
          benefits and to the extent that the Employee  shall be physically  and
          mentally able to do so, he shall furnish such information,  assistance
          and documents so as to assist in the continued ongoing business of the
          Bank  and,  if  able,  shall  make  himself  available  to the Bank to
          undertake  reasonable  assignments  consistent with his prior position
          and his physical and mental health.  The Bank shall pay all reasonable
          expenses  incident to the  performance of any assignment  given to the
          Employee during the disability period.

          (c) Just  Cause.  The Board may,  by written  notice to the  Employee,
     immediately  terminate  his  employment  at any time,  for Just Cause.  The
     Employee shall have no right to receive  compensation or other benefits for
     any period after termination for Just Cause.

          (d) Without  Just  Cause;  Constructive  Discharge.  The Board may, by
     written notice to the Employee, immediately terminate his employment at any
     time for a reason other than his  Disability or Just Cause,  in which event
     the Employee  shall be entitled to receive the following  compensation  and
     benefits (unless such termination  occurs during the Protected  Period,  in
     which event the benefits and compensation  provided for in Section 12 shall
     apply):

               (i) the salary  provided  pursuant to Section 3 hereof,  together
          with  accrued  incentive  pay  (based on the level of such pay for the
          year in which the  termination  occurs) up to the  expiration  date of
          this Agreement,  including any renewal term (the  "Expiration  Date"),
          and

               (ii) at the  Employee's  election  either  (A) cash in an  amount
          equal to the cost to the  Employee  of  obtaining  all  health,  life,
          disability  and other  benefits  which the  Employee  would  have been
          eligible to participate in through the

                                       5
<PAGE>

          Expiration Date based upon the benefit levels  substantially  equal to
          those  that  the  Bank  provided  for  the  Employee  at the  date  of
          termination  of employment or (B) continued  participation  under such
          Bank  benefit  plans  through  the  Expiration  Date to the extent the
          Employee continues to qualify for participation therein.

          All amounts  payable to the Employee  shall be paid,  at the option of
     the Employee, either (I) in periodic payments, through the Expiration Date,
     or (II) in one lump sum within ten days of such termination.

          (e) Good  Reason.  The  Employee  shall be  entitled  to  receive  the
     compensation  and benefits  payable  under  subsection  10(d) hereof in the
     event that the Employee voluntarily terminates employment within 90 days of
     an event that constitutes Good Reason,  (unless such voluntary  termination
     occurs  during  the  Protected  Period,  in which  event the  benefits  and
     compensation provided for in Section 12 shall apply).

          (f)  Termination or Suspension  Under Federal Law. (1) If the Employee
     is removed and/or permanently  prohibited from participating in the conduct
     of the Bank's affairs by an order issued under Sections  8(e)(4) or 8(g)(1)
     of the Federal  Deposit  Insurance Act ("FDIA") (12 U.S.C.  1818(e)(4)  and
     (g)(1)),  all obligations of the Bank under this Agreement shall terminate,
     as of the  effective  date of the order,  but vested  rights of the parties
     shall not be affected.

               (2) If the Bank is in default (as  defined in Section  3(x)(1) of
          FDIA), all obligations  under this Agreement shall terminate as of the
          date of default;  however,  this Paragraph shall not affect the vested
          rights of the parties.

               (3) If a notice  served  under  Section  8(e)(3) or (g)(1) of the
          FDIA (12 U.S.C.  1818(e)(3)  or (g)(1))  suspends  and/or  temporarily
          prohibits the Employee from participating in the conduct of the Bank's
          affairs,   the  Bank's  obligations  under  this  Agreement  shall  be
          suspended as of the date of such service, unless stayed by appropriate
          proceedings.  If the charges in the notice are dismissed, the Bank may
          in its discretion (i) pay the Employee all or part of the compensation
          withheld  while its  contract  obligations  were  suspended,  and (ii)
          reinstate  (in whole or in part)  any of its  obligations  which  were
          suspended.

               (4) Any payments made to the Employee pursuant to this Agreement,
          or otherwise,  are subject to and  conditioned  upon their  compliance
          with applicable law and regulations.

          (g) Voluntary  Termination by Employee.  Subject to Section 12 hereof,
     the Employee may voluntarily  terminate employment with the Bank during the
     term of this Agreement,  upon at least 90 days' prior written notice to the
     Board of  Directors,  in which case the  Employee  shall  receive  only his
     compensation,  vested  rights and  employee  benefits up to the date of his
     termination  (unless  such  termination  occurs  pursuant to Section  10(d)
     hereof or within the Protected  Period,  in Section 12(a) hereof,  in which
     event the benefits and  compensation  provided for in Sections 10(d) or 12,
     as applicable, shall apply).

          (h) Post-termination  Health Insurance.  If the Employee's  employment
     terminates  with the Bank or the  Company  for any  reason  other than Just
     Cause,  the Employee

                                       6
<PAGE>

     shall be entitled to purchase from the Bank, at the  Employee's own expense
     which shall not exceed  applicable  COBRA rates,  family medical  insurance
     under any group health plan that the Bank or the Company  maintains for its
     employees.  This right shall be (i) in addition to, and not in lieu of, any
     other  rights that the Employee  has under this  Agreement,  and (ii) shall
     continue until the Employee  first becomes  eligible for  participation  in
     Medicare.

     11. No  Mitigation.  The  Employee  shall not be required  to mitigate  the
         ---------------
amount of any payment provided for in this Agreement by seeking other employment
or otherwise and no such payment shall be offset or reduced by the amount of any
compensation or benefits provided to the Employee in any subsequent employment.

     12. Change in Control.
         ------------------

          (a)  Trigger  Events.  The  Employee  shall be entitled to collect the
     severance  benefits  set forth in  Subsection  (b) hereof in the event that
     either (i) the Employee  voluntarily  terminates  employment for any reason
     within the 30-day period beginning on the date of a Change in Control, (ii)
     the Employee voluntarily  terminates  employment within 90 days of an event
     that both occurs during the Protected  Period and constitutes  Good Reason,
     or  (iii)  the  Bank or the  Company  or  their  successor(s)  in  interest
     terminate the Employee's employment without his written consent and for any
     reason other than Just Cause during the Protected Period.

          (b) Amount of Severance  Benefit.  If the Employee becomes entitled to
     collect  severance  benefits  pursuant to Section  12(a)  hereof,  the Bank
     shall:

               (i) pay the Employee a severance  benefit equal to the difference
          between the Code Sec.280G  Maximum and the sum of any other "parachute
          payments"  as  defined  under  Code  ss.280G(b)(2)  that the  Employee
          receives on account of the Change in Control, and

               (ii)  pay for  long-term  disability  and  provide  such  medical
          benefits as are  available to the  Employee  under the  provisions  of
          COBRA,  for  eighteen  (18)  months (or such longer  period,  up to 24
          months, if COBRA is amended).

          The amount  payable  under this Section 12(b) shall be paid either (i)
     in one lump sum  within  ten days of the later of the date of the Change in
     Control  and the  Employee's  last day of  employment  with the Bank or the
     Company,  or (ii) if prior to the date which is 90 days  before the date on
     which a Change  in  Control  occurs,  the  Employee  filed a duly  executed
     irrevocable  written  election in the form attached  hereto as Exhibit "A",
     payment of such amount  shall be made  according  to the elected  schedule.
     Deferred  amounts  shall  bear  interest  from the date on which they would
     otherwise  be  payable  until the date paid at a rate  equal to 120% of the
     applicable federal rate, compounded semiannually,  as determined under Code
     Section 1274(d) and the regulations thereunder.

          In the event that the  Employee,  the Bank,  and the  Company  jointly
     agree that the Employee has collected an amount  exceeding the Code ss.280G
     Maximum, the parties may agree in writing that such excess shall be treated
     as a loan ab initio,  which the Employee  shall repay to the Bank, on terms
               ---------
     and conditions mutually agreeable to the parties, together with interest at
     the applicable  federal rate provided for in Section  7872(f)(2)(B)  of the
     Code.

                                       7
<PAGE>

     (c) Funding of Grantor  Trust upon  Change in  Control.  Not later than ten
business  days after a Change in Control,  the Bank shall (i) deposit in a Trust
an amount equal to the Code Sec.280G Maximum, unless the Employee has previously
provided a written release of any claims under this Agreement,  and (ii) provide
the  trustee of the Trust with a written  direction  to hold said amount and any
investment  return  thereon  in a  segregated  account  for the  benefit  of the
Employee, and to follow the procedures set forth in the next paragraph as to the
payment of such  amounts  from the Trust.  Upon the later of the  Trust's  final
payment of all amounts due under the  following  paragraph or the date 27 months
after the Change in Control,  the trustee of the Trust shall pay to the Bank the
entire balance remaining in the segregated account maintained for the benefit of
the Employee.  The Employee  shall  thereafter  have no further  interest in the
Trust.

     During the  27-consecutive  month  period  after a Change in  Control,  the
Employee may provide the trustee of the Trust with a written  notice  requesting
that the trustee pay to the Employee an amount designated in the notice as being
payable  pursuant to this Agreement.  Within three business days after receiving
said  notice,  the  trustee of the Trust  shall send a copy of the notice to the
Bank via overnight and registered  mail return receipt  requested.  On the tenth
(10th)  business day after  mailing said notice to the Bank,  the trustee of the
Trust  shall pay the  Employee  the amount  designated  therein  in  immediately
available  funds,  unless  prior  thereto the Bank  provides  the trustee with a
written  notice  directing the trustee to withhold  such payment.  In the latter
event,  the  trustee  shall  submit  the  dispute  to   non-appealable   binding
arbitration for a determination  of the amount payable to the Employee  pursuant
to this Agreement,  and the costs of such arbitration shall be paid by the Bank.
The  trustee  shall  choose  the  arbitrator  to settle  the  dispute,  and such
arbitrator shall be bound by the rules of the American  Arbitration  Association
in making his  determination.  The parties and the trustee shall be bound by the
results  of the  arbitration  and,  within  3 days of the  determination  by the
arbitrator, the trustee shall pay from the Trust the amounts required to be paid
to the Employee  and/or the Bank, and in no event shall the trustee be liable to
either party for making the payments as determined by the arbitrator.

     13.  Indemnification.  The Bank and the Company agree that their respective
          ----------------
Bylaws shall  continue to provide for  indemnification  of directors,  officers,
employees and agents of the Bank and the company,  including the Employee during
the full term of this Agreement,  and to at all times provide adequate insurance
for such purposes.

     14.  Reimbursement  of Employee for Enforcement  Proceedings.  In the event
          --------------------------------------------------------
that any dispute  arises  between the  Employee  and the Bank as to the terms or
interpretation of this Agreement, whether instituted by formal legal proceedings
or otherwise, including any action that the Employee takes to defend against any
action taken by the Bank or the Company,  the Employee  shall be reimbursed  for
all costs and expenses,  including reasonable attorneys' fees, arising from such
dispute,  proceedings  or actions,  provided that the Employee  obtains either a
written  settlement  or a final  judgement by a court of competent  jurisdiction
substantially in his favor. Such reimbursement  shall be paid within ten days of
the  Employee's  furnishing  to the Bank written  evidence,  which may be in the
form,  among  other  things,  of a canceled  check or  receipt,  of any costs or
expenses incurred by the Employee.

     15. Federal Income Tax  Withholding.  The Bank may withhold all federal and
         --------------------------------
state  income or other taxes from any benefit  payable  under this  Agreement as
shall be required pursuant to any law or government regulation or ruling.

                                       8
<PAGE>

     16. Successors and Assigns.
         -----------------------

     (a) Bank. This Agreement shall not be assignable by the Bank, provided that
this  Agreement  shall inure to the benefit of and be binding upon any corporate
or other successor of the Bank which shall acquire,  directly or indirectly,  by
merger,  consolidation,  purchase or otherwise,  all or substantially all of the
assets or stock of the Bank.

     (b)  Employee.  Since the Bank is  contracting  for the unique and personal
skills of the  Employee,  the  Employee  shall be  precluded  from  assigning or
delegating his rights or duties  hereunder  without first  obtaining the written
consent of the Bank;  provided,  however,  that nothing in this paragraph  shall
preclude (i) the Employee from  designating a beneficiary to receive any benefit
payable  hereunder  upon his death,  or (ii) the executors,  administrators,  or
other legal  representatives  of the Employee or his estate from  assigning  any
rights hereunder to the person or persons entitled thereunto.

     (c)  Attachment.  Except as required  by law, no right to receive  payments
under this Agreement shall be subject to anticipation,  commutation, alienation,
sale, assignment, encumbrance, charge, pledge, or hypothecation or to exclusion,
attachment,  levy or similar  process or assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.

     17.  Amendments.  No  amendments  or additions to this  Agreement  shall be
          -----------
binding  unless  made in  writing  and signed by all of the  parties,  except as
herein otherwise specifically provided.

     18. Applicable Law. Except to the extent preempted by Federal law, the laws
         ---------------
of the State of Maryland shall govern this Agreement in all respects, whether as
to its validity, construction, capacity, performance or otherwise.

     19.  Severability.  The  provisions  of  this  Agreement  shall  be  deemed
          -------------
severable and the  invalidity  or  unenforceability  of any provision  shall not
affect the validity or enforceability of the other provisions hereof.

     20. Entire  Agreement.  This Agreement,  together with any understanding or
         ------------------
modifications  thereof as agreed to in writing by the parties,  shall constitute
the entire  agreement  between the parties hereto and shall  supersede any prior
agreement between the parties, including their agreement entered into on June 1,
1986.


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<PAGE>

     IN WITNESS  WHEREOF,  the parties have executed this restated  Agreement on
the day and year first hereinabove written.


ATTEST:                                      COMMUNITY BANK OF TRI-COUNTY



                                             By: /s/ Michael L. Middleton
--------------------                         ----------------------------
Secretary                                    Its Chairman of the Board


WITNESS:


                                             By: /s/ Michael L. Middleton
--------------------                         ----------------------------
                                             Michael L. Middleton


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