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                                  Exhibit 10.4

                          FORM OF EMPLOYMENT AGREEMENT
                          ----------------------------

     THIS EMPLOYMENT AGREEMENT, dated as of this ____ day of ________, 2001, by
and between Virginia Financial Group, Inc., a Virginia corporation (the
"Company"), and Jeffrey W. Farrar (the "Executive").

     WHEREAS, the Executive has been a key executive officer of Virginia
Commonwealth Financial Corporation ("VCFC") and, by Agreement and Plan of
Reorganization, dated as June 12, 2001 (the "Merger Agreement"), VCFC and
Virginia Financial Corporation have agreed to merge and form the Company (the
"Merger");

     WHEREAS, the Merger Agreement provides that the parties will enter into
this Agreement to provide for the continued employment of the Executive by the
Company following the Merger;

     WHEREAS, the Company considers the availability of the Executive's services
to be important to the management and conduct of the Company's business and
desires to secure the continued availability of the Executive's services; and

     WHEREAS, the Executive is willing to make his services available to the
Company on the terms and subject to the conditions set forth herein.

     In consideration of the mutual covenants and agreements set forth herein,
the parties agree as follows:

                        Part I: General Employment Terms
                        ---------------------------------

     1.  Employment and Duties.  Conditional upon consummation of the Merger and
the Executive continuing in the employment of VCFC until the Effective Date of
the Merger (the "Effective Date"), and effective at the Effective Date, the
Executive shall be employed by the Company as its Executive Vice President and
Chief Financial Officer.  The Executive accepts such employment and agrees to
perform the managerial duties and responsibilities of Executive Vice President
and Chief Financial Officer.  The Executive agrees to devote his time and
attention on a full-time basis to the discharge of such duties and
responsibilities of an executive nature as may be assigned him by the Board of
Directors of the Company.  The Executive may accept any elective or appointed
positions or offices with any duly recognized associations or organizations
whose activities or purposes are closely related to the banking business or
service to which would generate good will for the Company and its subsidiaries.

     2.  Term.  The term of this Agreement (the "Term") shall commence at the
Effective Date and shall continue through December 31, 2004, unless terminated
or extended as hereinafter provided.  This Agreement shall be extended for
successive one-year periods following the original term unless either party
notifies the other in writing at least ninety (90) days prior to the end of the
original term, or the end of any additional one-year renewal term, that the
Agreement shall not be extended beyond its current term.
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     3.  Compensation.

     (a) Base Salary.  For the remainder of 2001 and for 2002, the Company shall
pay the Executive an annual base salary not less than $130,000.  Such base
salary shall be paid to the Executive in accordance with established payroll
practices of the Company.  For 2003 and for each remaining year of this
Agreement, including any renewal term, the Company agrees to review the
Executive's base salary and to consider implementing changes to such base salary
as it may deem appropriate; however, such base salary shall not be less than
$130,000.

     (b) Annual Bonus.  During the term of this Agreement, the Executive will be
eligible to participate in an annual incentive plan that will establish
measurable criteria and incentive compensation levels payable to the Executive
for corporate performance in relation to defined threshold benchmarks.  The
Compensation Committee or the Board of Directors of the Company, as the case may
be, will consult with management to establish the targeted corporate performance
levels for the Company on an annual basis consistent with the Company's business
plan and objectives.  Achievement of the targeted corporate performance levels
will result in an annual cash bonus payment equal to at least 28% of the
Executive's then current annual base salary.  To the extent the Company exceeds
the targeted performance levels, the incentive plan will provide a means by
which the annual bonus will be increased.  Similarly, the incentive plan will
provide a means by which the annual bonus will be decreased if the targeted
performance levels are not achieved, provided certain minimum threshold
benchmarks have been satisfied.  Any bonus payments due hereunder shall be paid
to the Executive no later than 75 days after the end of the year.

     (c) Stock Compensation.  Subject to the annual approval of the Compensation
Committee or the Board of Directors, as the case may be, the Executive will
receive during the term of this Agreement an annual stock award under the
Company's 2001 Incentive Stock Plan with a value equal to at least 20% of his
then current base salary.  The stock award, which will consist of stock options
or restricted stock grants, or any combination thereof, will include such
vesting and other terms and conditions as determined in the sole discretion of
the Compensation Committee or the Board of Directors in accordance with the 2001
Incentive Stock Plan.  The valuation of the stock award will be determined using
the Black-Scholes or similar methodology as determined by the Company.

     4.  Benefits.

     (a) During the term of this Agreement, the Executive shall be eligible to
participate in any plans, programs or forms of compensation or benefits that the
Company or its subsidiaries provide to the class of employees that includes the
Executive, on a basis not less favorable than that provided to such class of
employees, including, without limitation, group medical, disability and life
insurance, vacation and sick leave, and a retirement plan; provided however, a
reasonable transition period following any change in control, merger, statutory
share exchange, consolidation, acquisition or transaction involving the Company
or any of its subsidiaries shall be permitted in order to make appropriate
adjustments in compliance with this Section 4(a). The Company will allow the
Executive to continue to make salary deferral contributions to the Executive
Deferred Compensation Plan.

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     (b) The Executive shall be entitled to [__________] weeks vacation annually
without loss of pay.

     (c) The Company will pay the Executive's country club initiation fee and
dues on such basis as may be determined by the Board of Directors of the Company
from time to time.

     (d) During the term of this Agreement, the Company shall provide the
Executive with an appropriate automobile or automobile allowance as determined
by the Board of Directors of the Company.

     5.  Reimbursement of Expenses.  The Company shall reimburse the Executive
promptly, upon presentation of adequate substantiation, including receipts, for
the reasonable travel, entertainment, lodging and other business expenses
incurred by the Executive, including, without limitation, those expenses
incurred by the Executive and his spouse in attending trade and professional
association conventions, meetings and other related functions.  However, the
Company reserves the right to review these expenses periodically and determine,
in its sole discretion, whether future reimbursement of such expenses to the
Executive will continue without prior Board approval of the expenses.

     6.  Termination of Employment.

     (a) Death or Incapacity. The Executive's employment under this Agreement
shall terminate automatically upon the Executive's death. In the event of
termination due to the death of the Executive, his survivors, designees or
estate shall continue to receive, in addition to all other benefits accruing
upon death, full compensation hereunder for a period of three (3) months
following the month in which his death occurred. If the Company determines that
the Incapacity, as hereinafter defined, of the Executive has occurred, it may
terminate the Executive's employment and this Agreement upon thirty (30) days'
written notice provided that, within thirty (30) days after receipt of such
notice, the Executive shall not have returned to full-time performance of his
assigned duties. "Incapacity" shall mean the failure of the Executive to perform
his assigned duties with the Company on a full-time basis as a result of mental
or physical illness or injury as determined by a physician selected by the
Company for the greater of ninety (90) consecutive calendar days or the longest
waiting period under any long term disability insurance contract or program
provided to him as an employee.

     (b) Termination by Company With or Without Cause. The Company may terminate
the Executives employment during the term of this Agreement, with or without
Cause. For purposes of this Agreement, "Cause" shall mean:

          (i) continual or deliberate neglect by the Executive in the
performance of his material duties and responsibilities as established from time
to time by the Board of Directors of the Company, or the Executive's willful
failure to follow reasonable instructions or policies of the Company after being
advised in writing of such failure and being given a reasonable opportunity and
period (as determined by the Company) to remedy such failure;

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          (ii) conviction of, indictment for (or its procedural equivalent),
entering of a guilty plea or plea of no contest with respect to a felony, a
crime of moral turpitude or any other crime with respect to which imprisonment
is a possible punishment, or the commission of an act of embezzlement or fraud
against the Company or any subsidiary or affiliate thereof;

          (iii)  any breach by the Executive of a material term of this
Agreement, or violation in any material respect of any code or standard of
behavior generally applicable to officers of the Company, after being advised in
writing of such breach or violation and being given a reasonable opportunity and
period (as determined by the Company) to remedy such breach or violation;

          (iv) dishonesty of the Executive with respect to the Company or any
subsidiary or affiliate thereof, or breach of a fiduciary duty owed to the
Company or any subsidiary or affiliate thereof; or

          (v) the willful engaging by the Executive in conduct that is
reasonably likely to result, in the good faith judgment of the Company, in
material injury to the Company, monetarily or otherwise.

     (c) Termination by Executive for Good Reason. The Executive may terminate
his employment for Good Reason. For purposes of this Agreement, "Good Reason"
shall mean:

          (i) the continued assignment to the Executive of duties inconsistent
with the Executive's position, authority, duties or responsibilities as
contemplated by Section 1 hereof or, in the event of a Change in Control (as
hereinafter defined), Section 10(a);

          (ii) any action taken by the Company which results in a substantial
reduction in the status of the Executive, including a diminution in his
position, authority, duties or responsibilities, excluding for this purpose an
isolated, insubstantial and/or inadvertent action not taken in had faith and
which is remedied by the Company promptly after receipt of notice thereof given
by the Executive;

          (iii)  the relocation of the Executive to any other primary place of
employment which might require him to move his residence which, for this
purpose, includes any reassignment to a place of employment located more than 50
miles from the Executive's initially assigned place of employment, without the
Executive's express written consent to such relocation; provided, however, this
subsection (iii) shall not apply in connection with the relocation of the
Executive if the Company decides to relocate its headquarters; or

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          (iv) any failure by the Company, or any successor entity following a
Change in Control, to comply with the provisions of Sections 3 and 4 or Section
10(b) hereof or to honor any other term or provision of this Agreement, other
than an isolated, insubstantial or inadvertent failure not occurring in bad
faith and which is remedied by the Company promptly after receipt of notice
thereof given by the Executive.

     (d) Incapacity. If payments under a long term disability policy or plan
shall cease due to discontinuance of the plan for failure for any reason of the
provider of such policy to continue to make payments, the Company will provide
the benefits to the Executive in accordance with the terms of such policy or
plan as if it were still in full force and effect. Notwithstanding the above, in
no event shall the Company's obligation under this subparagraph be for more than
two years.

     7.  Obligations of the Company Upon Termination.

     (a) Without Cause; Good Reason. Except as set forth in Sections 7(b) and
7(c) below, if, during the term of this Agreement, the Company shall terminate
the Executive's employment without Cause or the Executive shall terminate
employment for Good Reason, the Company will pay to the Executive in a lump sum
within thirty (30) days after the termination of employment the sum of the
Executive's annual base salary through the date of termination to the extent not
theretofore paid and the balance of the Executive's annual base salary for a
period of eighteen (18) months from the date of termination of employment. The
Company shall also maintain in full force and effect for the Executive's
continued benefit, until eighteen (18) months from the date of termination of
employment, all health and insurance plans as required by federal law, and
provided that the Executive's continued participation is possible under the
general terms and provisions of such plans and programs. If the Company
reasonably determines that maintaining such health and insurance plans in full
force and effect for the benefit of the Executive until eighteen months from the
date of termination of employment is not feasible, the Company shall pay the
Executive a lump sum equal to the estimated cost of maintaining such plans for
the Executive for eighteen months. In addition, stock option and similar
agreements with the Executive evidencing the grant of a stock option or other
award under the Company's Stock Incentive Plan, or any successor plan, will
provide that the vesting of such stock awards will accelerate and become
immediately exercisable and fully vested as of the date of termination of
employment without Cause or for Good Reason. In the case of stock options, the
Executive will have at least ninety (90) days after termination of employment,
or such longer period as may be provided for in the separate stock option
agreement, to exercise the option.

     (b) Non-Competition. Notwithstanding the foregoing, all such payments and
benefits under Section 7(a) otherwise continuing for periods after the
Executive's termination of employment shall cease to be paid, and the Company
shall have no further obligation due with respect thereto, in the event the
Executive engages in "Competition" or makes any "Unauthorized Disclosure of
Confidential Information." In addition, in exchange for the payments on
termination as provided herein, other provisions of this Agreement and other
valuable consideration hereby acknowledged, the Executive agrees that he will
not engage in competition for a period of eighteen (18) months after the
Executive's employment with the Company ceases for any reason, including the
expiration or nonrenewal of this Agreement. For purposes hereof:

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          (i) "Competition" means the Executive's engaging without the written
consent of the board of directors of the Company or a person authorized thereby,
in an activity as an officer, a director, an employee, a partner, a more than
one percent shareholder or other owner, an agent, a consultant, or in any other
individual or representative capacity within 50 miles of the Company's
headquarters or any branch office of the Company or any of its subsidiaries
(unless the Executive's duties, responsibilities and activities, including
supervisory activities, for or on behalf of such activity, are not related in
any way to such competitive activity) if it involves:

               (A) engaging in or entering into the business of any banking,
lending or any other business activity in which the Company or any of its
affiliates is actively engaged at the time the Executive's employment ceases, or

               (B) soliciting or contacting, either directly or indirectly, any
of the customers or clients of the Company or any of its affiliates for the
purpose of competing with the products or services provided by the Company or
any of its affiliates, or

               (C) employing or soliciting for employment any employees of the
Company or any of its affiliates for the purpose of competing with the Company
or any of its affiliates.

          (ii) "Unauthorized Disclosure of Confidential Information" means the
use or disclosure of information in violation of Section 8 of this Agreement.

          (iii)  For purposes of this Agreement, "customers" or "clients" of the
Company or any of its affiliates means individuals or entities to whom the
Company or any of its affiliates has provided banking, lending, or other similar
financial services at any time from the Effective Date through the date the
Executive's employment with the Company ceases.

     (c) Death or Incapacity. If the Executive's employment is terminated by
reason of death or incapacity in accordance with Section 6(a) hereof, this
Agreement shall terminate without further obligation to the Executive or his
legal representatives under this Agreement except as otherwise specified in
Section 6(a).

     (d) Cause; Other Than for Good Reason. If the Executive's employment shall
be terminated for Cause or for other than Good Reason, this Agreement shall
terminate without any further obligation of the Company to the Executive other
than to pay to the Executive his annual base salary through the date of
termination. The Executive will still be required to comply with the non-
competition and confidentiality covenants set forth in Section 7(b).

     (e) Remedies. The Executive acknowledges that the restrictions set forth in
paragraph 7(b) of this Agreement are just, reasonable, and necessary to protect
the legitimate business interests of the Company. The Executive further
acknowledges that if he breaches or threatens to breach any provision of
paragraph 7(b), the Company's remedies at law will be inadequate, and the

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Company will be irreparably harmed. Accordingly, the Company shall he entitled
to an injunction, both preliminary and permanent, restraining the Executive from
such breach or threatened breach, such injunctive relief not to preclude the
Company from pursuing all available legal and equitable remedies. In addition to
all other available remedies, if the Executive violates the provisions of
paragraph 7(b), the Executive shall pay all costs and fees, including attorneys'
fees, incurred by the Company in enforcing the provisions of that paragraph. If,
on the other hand, it is finally determined by a court of competent jurisdiction
that a breach or threatened breach did not occur under paragraph 7(b) of this
Agreement, the Company shall reimburse the Executive for reasonable legal fees
incurred to defend that claim.

     8.  Confidentiality.  The Executive recognizes that as an employee of the
Company he will have access to and may participate in the origination of non-
public, proprietary and confidential information and that he owes a fiduciary
duty to the Company.  Confidential information may include, but is not limited
to, trade secrets, customer lists and information, internal corporate planning,
methods of marketing and operation, and other data or information of or
concerning the Company or its customers that is not generally known to the
public or in the banking industry.  The Executive agrees that he will never use
or disclose to any third party any such confidential information, either
directly or indirectly, except as may be authorized in writing specifically by
the Company.

                           Part II: Change in Control
                           ---------------------------

     9.  Employment After a Change in Control.  If a Change in Control of the
Company occurs during the term of this Agreement, and the Executive is employed
by the Company on the date the Change in Control occurs (the "Change in Control
Date"), the Company will continue to employ the Executive in accordance with the
terms and conditions of this Agreement for the period beginning on the Change in
Control Date and ending on the third anniversary of such date (the "Change in
Control Employment Period").  If a Change in Control occurs on account of a
series of transactions, the Change in Control Date is the date of the last of
such transactions.  Notwithstanding any other term or provision of this
Agreement, in the event of a Change in Control of the Company, Sections 9
through 15 in this Part II shall become effective and govern the terms and
conditions of the Executive's employment.

     10. Terms of Employment.

     (a) Position and Duties. During the Change in Control Employment Period,
(i) the Executive's position, authority, duties and responsibilities will be at
least commensurate in all material respects with the most significant of those
held, exercised and assigned at any time during the 90-day period immediately
preceding the Change in Control Date, and (ii) the Executive's services will be
performed at the location where the Executive was employed immediately preceding
the Change in Control Date or any office that is the headquarters of the Company
and is less than 35 miles from such location; it being understood and agreed
that this subsection (ii) shall supercede the provisions of Section 6(c)(iv)
dealing with the relocation of the Executive following a Change in Control.

     (b) Compensation and Benefits.

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          (i) Base Salary.  During the Change in Control Employment Period, the
Executive will receive an annual base salary (the "Annual Base Salary") at least
equal to the base salary paid or payable to the Executive by the Company and its
affiliated companies for the twelve-month period immediately preceding the
Change of Control Date.  During the Change in Control Employment Period, the
Annual Base Salary will be reviewed at least annually and will be increased at
any time and from time to time as will be substantially consistent with
increases in base salary generally awarded in the ordinary course of business to
other peer executives of the Company and its affiliated companies.  Any increase
in the Annual Base Salary will not serve to limit or reduce any other obligation
to the Executive under this Agreement.  The Annual Base Salary will not be
reduced after any such increase, and the term Annual Base Salary as used in this
Agreement will refer to the Annual Base Salary as so increased.  The term
"affiliated companies" includes any company controlled by, controlling or under
common control with the Company.

          (ii) Annual Bonus.  During the Change in Control Employment Period,
the Executive will be entitled to participate in an annual incentive plan
generally applicable to other peer executives of the Company and its affiliated
companies, but in no event will such incentive plan provide the Executive with a
less favorable opportunity to earn an annual bonus that is similarly structured
to the annual incentive plan as in effect at any time during the six months
immediately preceding the Change in Control Date.

          (iii)  Incentive, Savings and Retirement Plans.  During the Change in
Control Employment Period, the Executive will be entitled to participate in all
incentive (including stock incentive), savings and retirement, insurance plans,
policies and programs applicable generally to other peer executives of the
Company and its affiliated companies, but in no event will such plans, policies
and programs provide the Executive with incentive opportunities (including an
annual stock award with a value equal to at least 30% of his then current base
salary as provided in Section 3(c)), savings opportunities and retirement
benefit opportunities, in each case, less favorable, in the aggregate, than
those provided by the Company and its affiliated companies for the Executive
under such plans, policies and programs as in effect at any time during the six
months immediately preceding the Change in Control Date.

          (iv) Welfare Benefit Plans.  During the Change in Control Employment
Period, the Executive and/or the Executive's family, as the case may be, will be
eligible for participation in and will receive all benefits under welfare
benefit plans, policies and programs provided by the Company and its affiliated
companies to the extent applicable generally to other peer executives of the
Company and its affiliated companies, but in no event will such plans, policies
and programs provide the Executive with benefits that are less favorable, in the
aggregate, than the most favorable of such plans, policies and programs in
effect at any time during the six months immediately preceding the Change in
Control Date.

          (v) Fringe Benefits.  During the Change in Control Employment Period,
the Executive will be entitled to fringe benefits in accordance with the
comparable plans, policies and programs of the Company and its affiliated

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companies in effect for the Executive at any time during the six months
immediately preceding the Change in Control Date or, if more favorable to the
Executive, as in effect generally from time to time after the Change in Control
Date with respect to other peer executives of the Company and its affiliated
companies.

          (vi) Vacation.  During the Change in Control Employment Period, the
Executive will be entitled to paid vacation in accordance with the comparable
plans, policies and programs of the Company and its affiliated companies in
effect for the Executive at any time during the six months immediately preceding
the Change in Control Date or, if more favorable to the Executive, as in effect
generally from time to time after the Change in Control Date with respect to
other peer executives of the Company and its affiliated companies.

     11. Termination of Employment Following Change in Control.

     (a) Death or Incapacity. The Executive's employment will terminate
automatically upon the Executive's death or Incapacity during the Change in
Control Employment Period.

     (b) Cause. The Company may terminate the Executive's employment during the
Change in Control Employment Period for Cause (as defined in Section 6(b)).

     (c) Good Reason. The Executive's employment may be terminated during the
Change in Control Employment Period by the Executive for Good Reason (as defined
in Section 6(c). Any good faith determination of Good Reason made by the
Executive during the Change in Control Employment Period shall be conclusive.

     (d) Notice of Termination. Any termination during the Change in Control
Employment Period by the Company or by the Executive for Good Reason shall be
communicated by written Notice of Termination to the other party hereto. For
purposes of this Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this Agreement relied upon.

     (e) Date of Termination. "Date of Termination" means (i) if the Executive's
employment is terminated by the Company for Cause, or by the Executive for Good
Reason, the date of receipt of the Notice of Termination or any later date
specified therein, as the case may be, (ii) if the Executive's employment is
terminated by the Company other than for Cause or Incapacity, the date specified
in the Notice of Termination (which shall not be less than 30 nor more than 60
days from the date such Notice of Termination is given), and (iii) if the
Executive's employment is terminated for Incapacity, 30 days after Notice of
Termination is given, provided that the Executive shall not have returned to the
full-time performance of his duties during such 30-day period.

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     12. Compensation Upon Termination.

     (a) Termination Without Cause or for Good Reason. The Executive will be
entitled to the following benefits if, during the Change in Control Employment
Period, the Company terminates his employment without Cause or the Executive
terminates his employment with the Company or any affiliated company for Good
Reason.

          (i) Accrued Obligations.  The Accrued Obligations are the sum of: (1)
the Executive's Annual Base Salary through the Date of Termination at the rate
in effect just prior to the time a Notice of Termination is given; (2) the
amount, if any, of any incentive or bonus compensation theretofore earned which
has not yet been paid; (3) the product of the Annual Bonus paid or payable,
including by reason of deferral, for the most recently completed year and a
fraction, the numerator of which is the number of days in the current year
through the Date of Termination and the denominator of which is 365; and (4) any
benefits or awards (including both the cash and stock components) which pursuant
to the terms of any plans, policies or programs have been earned or become
payable, but which have not yet been paid to the Executive (but not including
amounts that previously had been deferred at the Executive's request, which
amounts will be paid in accordance with the Executive's existing directions).
The Accrued Obligations will be paid to the Executive in a lump sum cash payment
within ten days after the Date of Termination;

          (ii) Salary Continuance Benefit.  The Salary Continuance Benefit is an
amount equal to 2.99 times the Executive's Final Compensation.  For purposes of
this Agreement, "Final Compensation" means the Annual Base Salary in effect at
the Date of Termination, plus the highest Annual Bonus paid or payable for the
two most recently completed years and any amount contributed by the Executive
during the most recently completed year pursuant to a salary reduction agreement
or any other program that provides for pre-tax salary reductions or compensation
deferrals.  The Salary Continuance Benefit will be paid to the Executive in a
lump sum cash payment not later than the 45th day following the Date of
Termination;

          (iii)  Welfare Continuance Benefit.  For 36 months following the Date
of Termination, the Executive and his dependents will continue to be covered
under all health and dental plans, disability plans, life insurance plans and
all other welfare benefit plans (as defined in Section 3(1) of ERISA) ("Welfare
Plans") in which the Executive or his dependents were participating immediately
prior to the Date of Termination (the "Welfare Continuance Benefit").  The
Company will pay all or a portion of the cost of the Welfare Continuance Benefit
for the Executive and his dependents under the Welfare Plans on the same basis
as applicable, from time to time, to active employees covered under the Welfare
Plans and the Executive will pay any additional costs.  If participation in any
one or more of the Welfare Plans included in the Welfare Continuance Benefit is
not possible under the terms of the Welfare Plan or any provision of law would
create an adverse tax effect for the Executive or the Company due to such
participation, the Company will provide substantially identical benefits
directly or through an insurance arrangement.  The Welfare Continuance Benefit
as to any Welfare Plan will cease if and when the Executive has obtained
coverage under one or more welfare benefit plans of a subsequent employer that
provides for equal or greater benefits to the Executive and his dependents with
respect to the specific type of benefit.  The Executive or his dependents will
become eligible for COBRA continuation coverage as of the date the Welfare
Continuance Benefit ceases for all health and dental benefits.

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     (b) Death. If the Executive dies during the Change in Control Employment
Period, this Agreement will terminate without any further obligation on the part
of the Company under this Agreement, other than for (i) payment of the Accrued
Obligations and three months of the Executive's Base Salary (which shall be paid
to the Executive's beneficiary designated in writing or his estate, as
applicable, in a lump sum cash payment within 30 days of the date of death);
(ii) the timely payment or provision of the Welfare Continuance Benefit to the
Executive's spouse and other dependents for 36 months following the date of
death; and (iii) the timely payment of all death and retirement benefits
pursuant to the terms of any plan, policy or arrangement of the Company and its
affiliated companies.

     (c) Incapacity. If the Executive's employment is terminated because of the
Executive's Incapacity during the Change in Control Employment Period, this
Agreement will terminate without any further obligation on the part of the
Company under this Agreement, other than for (i) payment of the Accrued
Obligations and three months of the Executive's Base Salary (which shall be paid
to the Executive in a lump sum cash payment within 30 days of the Date of
Termination); (ii) the timely payment or provision of the Welfare Continuance
Benefit for 36 months following the Date of Termination; and (iii) the timely
payment of all disability and retirement benefits pursuant to the terms of any
plan, policy or arrangement of the Company and its affiliated companies.

     (d) Cause; Other than for Good Reason. If the Executive's employment is
terminated for Cause during the Change in Control Employment Period, this
Agreement will terminate without further obligation to the Executive other than
the payment to the Executive of the Annual Base Salary through the Date of
Termination, plus the amount of any compensation previously deferred by the
Executive. If the Executive terminates employment during the Change in Control
Employment Period, excluding a termination either for Good Reason, this
Agreement will terminate without further obligation to the Executive other than
for the Accrued Obligations (which will be paid in a lump sum in cash within 30
days of the Date of Termination) and any other benefits to which the Executive
may be entitled pursuant to the terms of any plan, program or arrangement of the
Company and its affiliated companies.

     (e) Possible Reduction in Payment and Benefits. Following any Change in
Control, to the extent that any amount of pay or benefits provided under to the
Executive under this Agreement would cause the Executive to be subject to excise
tax under sections 280G and 4999 of the Internal Revenue Code of 1986, as
amended (the "Code"), and after taking into consideration all other amounts
payable to the Executive under other Company plans, programs, policies, and
arrangements, then the amount of pay and benefits provided under this Agreement
shall be reduced to the extent necessary to avoid imposition of any such excise
taxes. The Executive may select the payments and benefits to be limited or
reduced, including an election not to have the vesting of certain benefits,
including stock options, accelerate as a result of a Change in Control.

     (f) Acceleration of Vesting of Stock Awards. Except as may be otherwise
agreed to by the Executive, all stock option and similar agreements with the
Executive evidencing the grant of a stock option or other award under the

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Company's Stock Incentive Plan, or any successor plan, will provide that (i) the
vesting of such stock awards will accelerate and become immediately exercisable
and fully vested as of the Change in Control Date, and (ii) in the case of stock
options, the Executive will have at least ninety (90) days after termination of
employment, or such longer period as may be provided for in the separate stock
option agreement, to exercise the stock option.

     13. Fees and Expenses; Mitigation; Noncompetition.

     (a) The Company will pay or reimburse the Executive for all costs and
expenses, including without limitation court costs and reasonable attorneys'
fees, incurred by the Executive (i) in contesting or disputing any termination
of the Executive's employment or (ii) in seeking to obtain or enforce any right
or benefit provided by this Agreement, in each case provided the Executive's
claim is substantially upheld by a court of competent jurisdiction.

     (b) The Executive shall not be required to mitigate the amount of any
payment the Company becomes obligated to make to the Executive in connection
with this Agreement, by seeking other employment or otherwise. Except as
specifically provided above with respect to the Welfare Continuance Benefit, the
amount of any payment provided for in Section 12 shall not be reduced, offset or
subject to recovery by the Company by reason of any compensation earned by the
Executive as the result of employment by another employer after the Date of
Termination, or otherwise.

     (c) The Executive will not be required to comply with the noncompetition
covenant in Section 7(b) if his employment is terminated during the Change in
Control Employment Period without Cause or he terminates for Good Reason.

     14. Continuance of Welfare Benefits Upon Death. If the Executive dies while
receiving a Welfare Continuation Benefit, the Executive's spouse and other
dependents will continue to be covered under all applicable Welfare Plans during
the remainder of the 36-month coverage period. The Executive's spouse and other
dependents will become eligible for COBRA continuation coverage for health and
dental benefits at the end of such 36-month period.

     15. Change of Control Defined. For purposes of this Agreement, a "Change of
Control" shall mean:

     (a) the acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act') of beneficial ownership (within the meaning of Rule
13d-3 under the Exchange Act), of securities of the Company representing 20% or
more of the combined voting power of the then outstanding securities; provided,
however, that the following acquisitions shall not constitute a Change of
Control:

          (i) acquisition directly from the Company (excluding an acquisition by
virtue of the exercise of a conversion privilege);

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<PAGE>

          (ii) any acquisition by the Company;

          (iii)  any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the
Company; or

          (iv) any acquisition pursuant to a reorganization, merger or
consolidation by any corporation owned or proposed to be owned, directly or
indirectly, by shareholders of the Company if the shareholders' ownership of
securities of the corporation resulting from such transaction constitutes a
majority of the ownership of securities of the resulting entity and at least a
majority of the members of the board of directors of the corporation resulting
from such transaction were members of the incumbent board as defined in this
Agreement at the time of the execution of the initial agreement providing for
such reorganization, merger or consolidation; or

     (b) where individuals who, as of the inception of this Agreement,
constitute the board of directors of the Company (the "Incumbent Board") cease
for any reason to constitute at least a majority of such board of directors;
provided, however, that any individual becoming a director subsequent to the
effective date of this Agreement whose election, or nomination for election by
the shareholders was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or
other actual or threatened solicitation of proxies or consents by or on behalf
of a person other than a member of the board of directors; or

     (c) the shareholders of the Company approve, or the Company otherwise
consummates,

          (i) a merger, statutory share exchange, or consolidation of the
Company with any other corporation, except as provided in subparagraph (a)(iv)
of this section, or

          (ii) the sale or other disposition of all or substantially all of the
assets of the Company.

                             Part III: Miscellaneous
                            ------------------------

     16.  Documents.  All documents, record, tapes and other media of any kind
or description relating to the business of the Company or any of its affiliates
(the "Documents"), whether or not prepared by the Executive, shall be the sole
and exclusive property of the Company.  The Documents (and any copies) shall be
returned to the Company upon the Executive's termination of employment for any
reason or at such earlier time or times as the Board of Directors or its
designee may specify.

                                       13
<PAGE>

     17. Severability. If any provision of this Agreement, or part thereof, is
determined to be unenforceable for any reason whatsoever, it shall be severable
from the remainder of this Agreement and shall not invalidate or affect the
other provisions of this Agreement, which shall remain in full force and effect
arid shall be enforceable according to their terms. No covenant shall be
dependent upon any other covenant or provision herein, each of which stands
independently.

     18. Modification. The parties expressly agree that should a court find any
provision of this Agreement, or part thereof, to be unenforceable or
unreasonable, the court may modify the provision, or part thereof, in a manner
which renders that provision reasonable, enforceable, and in conformity with the
public policy of Virginia.

     19. Governing Law. This agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia.

     20. Notices. All written notices required by this Agreement shall be deemed
given when delivered personally or sent by registered or certified mail, return
receipt requested, to the parties at their addresses set forth on the signature
page of this Agreement. Each party may, from time to time, designate a different
address to which notices should be sent.

     21. Amendment. This Agreement may not be varied, altered, modified or in
any way amended except by an instrument in writing executed by the parties
hereto or their legal representatives.

     22. Binding Effect. This Agreement shall be binding upon the Executive and
on the Company, its successors and assigns effective on the date first above
written subject to the approval by the board of directors of the Company. The
Company will require any successor to all or substantially all of the business
and/or assets of the Company to assume expressly and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.

     23. No Construction Against Any Party. This Agreement is the product of
informed negotiations between the Executive and the Company. If any part of this
Agreement is deemed to he unclear or ambiguous, it shall be construed as if it
were drafted jointly by all parties. The Executive and the Company agree that
neither party was in a superior bargaining position regarding the substantive
terms of this Agreement.

     24. Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the matters addressed herein and it supersedes all
other prior agreements and understandings, both written and oral, express or
implied, with respect to the subject matter of this Agreement.

                                       14
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written herein.


                                   VIRGINIA FINANCIAL GROUP, INC.


                                   By:
                                      ----------------------------
                                       Harry V. Boney, Jr.
                                       Chairman of the Board



                                      ----------------------------
                                       Jeffrey W. Farrar



                                       15